SEPARATION AGREEMENT
Exhibit 10.3
THIS SEPARATION AGREEMENT (this “Agreement”) is entered into as of the Effective Date, as defined in Section 6 hereof, by and between Southern National Bancorp of Virginia, Inc. (the “Company”) and Xx. Xxxxxxx X. Xxxxxxx (“Employee”). Together, the Company and Employee may be referred to hereinafter as the “Parties.”
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Consideration for this Agreement. In consideration of Employee’s promises and the General Release of Claims and Covenant Not To Xxx contained in Section 3 of this Agreement, the Company agrees to: |
a. pay or provide to Employee the payments and benefits set forth in Section 5(a) of the Employment Agreement (as defined in Section 7 hereof), subject to the terms and conditions thereof, except that (1) Employee shall receive twelve (12) months (instead of six (6) months) of |
base salary continuation at the rate in effect on the Separation Date, payable in accordance with the established payroll practices of the Company (but not less frequently than monthly and in equal installments); and (2) Section 5(a)(ii) of the Employment Agreement shall be amended to provide that the Company shall provide Employee with access to a personal assistant in a manner consistent with past practice for three (3) years (instead of two (2) years) following the Separation Date, provided that the dollar value attributed to the services provided by such personal assistant to Employee shall not exceed $60,000 per year; provided, further, that if the Company determines in its sole discretion that it is unable to provide Employee with such access to a personal assistant at any time during the three years, then the Company shall pay to Employee a lump sum cash payment equal to $60,000 per year for the remainder of the three-year period, pro-rated for partial calendar years; and |
b. take the following actions with respect to certain of Employee’s outstanding options: (1) amend Employee’s 72,000 options outstanding on the Separation Date with an exercise price greater than $9.70 (the “3-Year Extension Options”) such that the period of time in which Employee has to exercise the shares subject to the 3-Year Extension Options shall be extended until the earlier of (i) the expiration of the original term of each Option or (ii) the third anniversary of the Separation Date; and (2) amend Employee’s 20,000 options outstanding on the Separation Date with an exercise price equal to $9.14 (the “2-Year Extension Options” and, together with the 3-Year Extension Options, the “Extended Options”) such that the period of time in which Employee has to exercise the shares subject to the 2-Year Extension Options shall be extended until the earlier of (i) the expiration of the original term of each Option or (ii) the second anniversary of the Separation Date. Notwithstanding the foregoing, in no event shall any Extended Option remain outstanding or exercisable: (i) more than 10 years following the date of grant of the Option; or (ii) following the Extended Option’s original expiration date. |
a.General Release of Claims. In consideration of the payments made to Employee by the Company and the promises contained in this Agreement, Employee on behalf of himself and Employee’s agents and successors in interest, hereby UNCONDITIONALLY RELEASES AND DISCHARGES the Company, its successors, subsidiaries (including, without limitation, Sonabank), parent companies, assigns, joint ventures, and affiliated companies and their respective agents, legal representatives (including, without limitation, Xxxxxx & Bird LLP), shareholders, attorneys, employees, members, managers, officers and directors (collectively, the “Releasees”) from ALL CLAIMS, LIABILITIES, DEMANDS AND CAUSES OF ACTION which she may by law release, as well as all contractual obligations not expressly set forth in this Agreement, whether known or unknown, fixed or contingent, that she may have or claim to have against any Releasee for any reason as of the date of execution of this Agreement. This General Release and Covenant Not To Xxx includes, but is not limited to, claims arising under federal, state or local laws prohibiting employment discrimination; claims arising under severance plans and contracts; and claims growing out of any legal restrictions on the Company’s and Sonabank’s rights to terminate its employees or to take any other employment action, whether statutory, contractual or arising
under common law or case law. Employee specifically acknowledges and agrees that she is releasing any and all rights under federal, state and local employment laws including without limitation the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 1981, the Americans With Disabilities Act, the Family and Medical Leave Act, the Genetic Information Nondiscrimination Act, the anti-retaliation provisions of the Fair Labor Standards Act, the Employee Retirement Income Security Act, the Equal Pay Act, the Occupational Safety and Health Act, the Worker Adjustment and Retraining Notification Act, the Employee Polygraph Protection Act, the Fair Credit Reporting Act, the Virginia Human Rights Act, the Virginians with Disabilities Act, the Virginia Equal Pay Act, the Virginia Payment of Wage Law, and any and all other local, state, and federal law claims arising under statute or common law. It is agreed that this is a general release and it is to be broadly construed as a release of all claims, except as set forth in Section 3(d) below.
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Protected Rights. Employee understands that nothing contained in this Agreement limits Employee’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”). Employee further understands that this Agreement does not limit Employee’s ability to communicate or share information with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agencies. However, |
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Revocation and Effective Date. The Parties agree Employee may revoke the Agreement at will within seven (7) days after she executes the Agreement by giving written notice of revocation to the Company. Such notice must be delivered to Xxxx Xxxxxx, Xxxxxx & Bird LLP, 0000 Xxxx Xxxxxxxxx Xxxxxx XX, Xxxxxxx, Xxxxxxx 00000, xxxx.xxxxxx@xxxxxx.xxx, and must actually be received by him at or before the above-referenced seven-day deadline. The Agreement may not be revoked after the expiration of the seven-day deadline. In the event that Employee revokes the Agreement within the revocation period described in this Section, this Agreement shall not be effective or enforceable, and all rights and obligations hereunder shall be void and of no effect. Assuming that Employee does not revoke this Agreement within the revocation period described above, the effective date of this Agreement (the “Effective Date”) shall be the eighth (8th) day after the day on which Employee executes this Agreement. |
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Survival of Certain Obligations on Employee. Employee’s obligations under Section 6 of the Amended and Restated Employment Agreement dated as of October 2, 2019 between Employee and the Company (the “Employment Agreement”), as well as any other provisions of the Employment Agreement necessary to interpret or enforce Employee’s obligations under such Section 6, shall remain in full force and effect in accordance with their terms, and nothing in this Agreement shall alter such obligations or terms. |
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Return of Property. Employee’s access to Employee’s Company e-mail account will be terminated on the April 3, 2020, but the Company will make its IT staff reasonably available between the Separation Date and the Annual Meeting Date to cooperate in good faith with Employee to retrieve Employee’s personal contacts and personal e-mails from such account. |
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Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the state of Virginia without giving effect to its conflict of law principles. |
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Severability. With the exception of the release contained in Section 3, the provisions of this Agreement are severable and if any part of it is found to be unenforceable the other sections |
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Stand-Still. For a period of 24 months from the date of this Agreement, unless Employee shall have been specifically invited in writing by the Company, neither Employee nor any person acting on behalf of or in concert with Employee will in any manner, directly or indirectly, (a) effect or seek, offer or propose (whether publicly or otherwise) or enter into an agreement to effect, or cause or participate in or in any way assist any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in, (i) any acquisition of any securities (or beneficial ownership thereof) or assets of the Company or any of its subsidiaries, (ii) any tender or exchange offer, merger or other business combination involving the Company or any of its subsidiaries, (iii) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company or any of its subsidiaries, or (iv) any “solicitation” of “proxies” (as such terms are used in the proxy rules of the Securities and Exchange Commission) or consents to vote any voting securities of the Company, (b) form, join or in any way participate in a “group” (as defined under the 0000 Xxx) with respect to more than 5% of the securities of the Company, (c) otherwise act, alone or in concert with others, to seek to control or influence the management, board, or policies of the Company, (d) take any action which might force the Company to make a public announcement regarding any of the types of matters set forth in (a) above, or (e) enter into any discussions or arrangements with any third party with respect to any of the foregoing. Employee also agrees during such period not to request the Company (or its directors, officers, employees, advisors or agents), directly or indirectly, to amend or waive any provision of this paragraph (including this sentence). |
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Required Disclosure. Employee acknowledges she has been provided with a notice (Exhibit A to this Agreement), pursuant to the Older Workers Benefit Protection Act, 29 U.S.C. § 626(f), that fully complies with the requirements of 29 U.S.C. § 626(f)(1)(H). |
(Signature page follows)
The Parties hereby signify their agreement to these terms by their signatures below.
/s/ Xxxxxxx X. Xxxxxxx
Date: March 30, 2020 |
Southern National Bancorp of Virginia, Inc.
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx, Xx.
Title: President and Chief Executive Officer
Date: March 30, 2020 |
Exhibit A
This notice applies to the exit incentive conducted at Southern National Bancorp of Virginia, Inc. (the “Company”) and the severance payments being offered in connection therewith (the “Exit Incentive and Severance Program”). For purposes of the Exit Incentive and Severance Program, you were considered to be a part of the organizational unit consisting of employees working as part of the Office of the Chairman (the “Organizational Unit”). To be eligible for the Severance described in the attached Agreement, you must execute the Agreement within forty-five (45) days after you receive it, and not revoke the Agreement during the seven (7) day revocation period following execution of the Agreement. The Severance offered in the Agreement in connection with the Exit Incentive and Severance Program is, therefore, contingent upon the Company receiving a signed and unrevoked Agreement, which includes a general release of claims, from you.
The following is a list of the ages and job titles of persons in the Organizational Unit who were selected for inclusion in the Exit Incentive and Severance Program in exchange for signing an agreement which includes a general release:
Job Title |
Age |
Executive Chairman |
75 |
Executive Vice Chairman |
75 |
There are not any employees in the Organizational Unit who were not selected for inclusion in the Exit Incentive and Severance Program.