EMPLOYMENT AGREEMENT
THIS
AGREEMENT
is made
as of the 23rd day
of June
2006,
between
HARLEYSVILLE
MANAGEMENT SERVICES, LLC
(HMS), a
corporation having a place of business at 000 Xxxx Xxxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000; and Xxxxx
X. Xxx (“Executive”),
an individual residing at 0000 Xxxxxx Xxxx, Xxxxxxxxx, XX 00000.
WITNESSETH:
WHEREAS,
HMS is
a subsidiary of HARLEYSVILLE
NATIONAL BANK AND TRUST COMPANY
(the
“Bank”), a national bank having a place of business at 000 Xxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000;
WHEREAS,
Bank
is a
subsidiary of HARLEYSVILLE
NATIONAL CORPORATION
(“HNC”),
a Pennsylvania business corporation having a place of business at 000 Xxxx
Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000;
WHEREAS,
HMS
desires to employ Executive to serve in the capacity of Executive
Vice President of Commercial Banking, and Chief Lending
Officer
of the
Bank and HNC under the terms and conditions set forth herein;
WHEREAS,
Executive desires to accept employment with HMS under the terms and conditions
set forth herein.
AGREEMENT:
NOW,
THEREFORE,
the
parties hereto, intending to be legally bound, agree as follows:
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1.
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Employment.
HMS hereby employs Executive and Executive hereby accepts employment
with
HMS, on the terms and conditions set forth in this
Agreement.
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2.
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Duties
of Employee.
Executive shall perform and discharge well and faithfully such duties
as
an executive officer of the Bank as may be assigned to Executive
from time
to time by the Boards of Directors of HNC and Bank. Executive shall
be
Executive Vice President and Chief Lending Officer of the Bank and
HNC,
and shall hold such other titles as may be given to him from time
to time
by the Boards of Directors of HNC and the Bank. Executive shall devote
his
full time, attention and energies to the business of HNC and the
Bank
during the Employment Period (as defined in Section 3 of this Agreement);
provided, however, that this Section 2 shall not be construed as
preventing Executive from (a) engaging in activities incident or
necessary
to personal investments so long as such investment does not exceed
5% of
the outstanding shares of any publicly held company, (b) acting as
a
member of the Board of Directors of any other corporation or as a
member
of the Board of Trustees of any other organization, with the
prior
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approval
of the Board of Directors of HNC and Bank. The Executive shall not engage in
any
business or commercial activities, duties or pursuits that compete with the
business or commercial activities of HNC, or any of its subsidiaries or
affiliates, nor may the Executive serve as a director or officer or in any
other
capacity in a company that competes with HNC or any of its subsidiaries or
affiliates.
3. Term
of Agreement.
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(a)
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This
Agreement shall be for a two (2)
year period
(the “Employment Period”) beginning on the date first mentioned above and
ending two (2) years later. The Employment Period shall be automatically
extended on the second anniversary date of commencement of the Employment
Term (the “Renewal Date”) and on the same date of each subsequent year for
a period ending one (1) year from each Renewal Date unless either
party
shall give written notice of non-renewal to the other party at least
sixty
(60)
days prior to the Renewal Date, in which event this Agreement shall
terminate at the end of the then existing Employment
Period.
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(b)
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Notwithstanding
the provisions of Section 3(a) of this Agreement, this Agreement
shall
terminate automatically for Cause (as defined herein) upon written
notice
from the Board of Directors of HNC to Executive. As used in this
Agreement, “Cause”
shall mean any of the following:
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(i)
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Executive’s
conviction of or plea of guilty or nolo contendere to a felony, a
crime of
falsehood or a crime involving moral turpitude, or the actual
incarceration of Executive;
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(ii)
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Executive’s
willful failure to follow the good faith lawful instructions of the
Board
of Directors of HNC with respect to its operations; or
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(iii)
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Executive’s
willful failure to perform Executive’s duties to HNC (other than a failure
resulting from Executive’s incapacity because of physical or mental
illness, as provided in subsection (d) of this Section 3), which
failure
results in injury to HNC, monetarily or
otherwise.
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(iv)
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Executive’s
intentional violation of the provisions of this
Agreement;
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(v)
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Dishonesty
or gross negligence of the Executive in the performance of his duties;
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(vi)
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Conduct
on the part of the Executive that brings public discredit to HNC;
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(vii)
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Executive’s
breach of fiduciary duty involving personal
profit;
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| (viii) |
Executive’s
violation of any law, rule or regulation governing banks or
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bank
officers or any final cease and desist order issued by a bank regulatory
authority;
| (ix) |
Executive’s
unlawful discrimination, including harassment, against HNC’s employees,
customers, business associates, contractors or
visitors;
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| (x) |
Executive’s
theft or abuse of HNC’s property or the property of HNC’s customers,
employees, contractors, vendors or business
associates;
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| (xi) |
any
final removal or prohibition order to which the Executive is subject,
by a
federal banking agency pursuant to Section 8(e) of the Federal Deposit
Insurance Act;
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| (xii) |
any
act of fraud or misappropriation by Executive;
or
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| (xiii) |
intentional
misrepresentation of a material fact, or intentional omission of
information necessary to make the information supplied not materially
misleading, in any application or other information provided by the
Executive to HNC or any representative of HNC in connection with
the
Executive’s employment with HNC.
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If
this
Agreement is terminated for Cause, Executive’s rights under this Agreement shall
cease as of the effective date of such termination.
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(c)
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Notwithstanding
the provisions of Section 3(a) of this Agreement, this Agreement
shall
terminate automatically upon Executive’s voluntary termination of
employment (other than in accordance with Section 5 of this Agreement)
for
Good Reason. The term “Good
Reason”
shall mean (i) the assignment of duties and responsibilities inconsistent
with Executive’s status as Executive Vice President and Chief Lending
Officer of Bank and HNC, (ii) a reduction in salary or benefits,
except
such reductions that are the result of a national financial depression
or
national or bank emergency when such reduction has been implemented
by the
Board of Directors for HNC and Bank’s senior management, or (iii) a
reassignment which requires Executive to move his principal office
more
than fifty (50) miles from HNC’s principal executive office immediately
prior to this Agreement. If such termination occurs for Good Reason
and
upon execution of a mutual release, then HMS shall pay Executive
an amount
equal to and no greater than 1.0 times the Executive’s Agreed Compensation
as defined in subsection (g) of this Section 3, which amount shall
be
payable in twelve (12) equal monthly installments. In addition, Executive
shall be entitled to a continuation of HMS’s employee benefits for twelve
(12) months or until Executive secures substantially similar benefits
through other employment, whichever shall first occur. If Executive
is no
longer eligible to participate in an employee benefit plan because
he is
no longer an employee, HMS will pay
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Executive
the amount of money that it would have cost
HMS to provide the benefits to Executive. However, in the event the payment
described herein, when added to all other amounts or benefits provided to or
on
behalf of the Executive in connection with his termination of employment, would
result in the imposition of an excise tax under Code Section 4999, such payments
shall be retroactively (if necessary) reduced to the extent necessary to avoid
such excise tax imposition. Upon written notice to Executive, together with
calculations of HMS’s independent auditors, Executive shall remit to HMS the
amount of the reduction plus such interest as may be necessary to avoid the
imposition of such excise tax. Notwithstanding the foregoing or any other
provision of this contract to the contrary, if any portion of the amount herein
payable to the Executive is determined to be non-deductible pursuant to the
regulations promulgated under Section 280G of the Internal Revenue Code of
1986,
as amended (the “Code”), then HNC shall be required only to pay to Executive the
amount determined to be deductible under Section 280G.
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(d)
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Notwithstanding
the provisions of Section 3(a) of this Agreement, this Agreement
shall
terminate automatically upon Executive’s Disability and Executive’s rights
under this Agreement shall cease as of the date of such termination;
provided, however, that Executive shall nevertheless be absolutely
entitled to receive an amount equal to and no greater than seventy
(70%)
of the Executive’s Agreed Compensation as defined in subsection (g) of
this Section 3, less amounts payable under any disability plan of
HMS,
until the earliest of (i) his return to employment, (ii) his attainment
of
age 65, or (iii) his death. In addition, Executive shall be entitled
to a
continuation of HMS’s employee benefits for such period. If Executive is
no longer eligible to participate in an employee benefit plan because
he
no longer is an employee, HMS will pay the Executive the amount of
money
that it would have cost HMS to provide the benefits to Executive.
For
purposes of this Agreement, Disability shall mean Executive’s
incapacitation by accident, sickness or otherwise which renders Executive
mentally or physically incapable of performing all of the essential
functions of his job, taking into account any reasonable accommodation
required by law, without posing a direct threat to himself or others,
for
a period of six (6) months.
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(e)
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Notwithstanding
the provisions of Section 3(a) of this Agreement, this Agreement
shall
terminate automatically upon Executive’s death and Executive’s rights
under this Agreement shall cease as of the date of such
termination.
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(f)
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Notwithstanding
the provisions of Section 3(a) of this Agreement, this Agreement
shall
terminate automatically upon Executive’s voluntary termination of
employment absent Good Reason.
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(g)
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The
term “Agreed
Compensation”
shall equal the Executive’s highest Annual Base Salary under the
Agreement, plus the highest annual incentive bonus paid to
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the
Executive during the previous two years.
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(h)
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Executive
agrees that in the event his employment under this Agreement is
terminated, Executive shall resign as a director of HNC, or any affiliate
or subsidiary thereof, if he is then serving as a director of any
such
entities.
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4. Employment
Period Compensation.
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(a)
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Annual
Base Salary.
For services performed by Executive under this Agreement, HMS shall
pay
Executive an Annual Base Salary in the aggregate during the Employment
Period at the rate of $180,000
per year,
payable at the same times as salaries are payable to other executives
of
HNC. HMS may, from time to time, increase Executive’s Annual Base Salary,
and any and all such increases shall be deemed to constitute amendments
to
this Section 4(a) to reflect the increased amounts, effective as
of the
date established for such increases by the Board of Directors of
HNC or
any committee of such Board in the resolutions authorizing such
increases.
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(b)
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Bonus.
HMS may, from time to time, pay a bonus or bonuses to Executive as
HMS or
HNC, in their sole discretion, deem appropriate. Executive shall
be
eligible to participate in a bonus opportunity that is contingent
upon the
achievement of both individual and corporate objectives. The details
of
this bonus opportunity are referenced by attachment. The
payment of any such bonuses shall not reduce or otherwise affect
any other
obligation of HNC to Executive provided for in this Agreement.
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(c)
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Vacations.
During the term of this Agreement, Executive shall be entitled to
four (4)
weeks annual vacation in accordance with the policies as established
from
time to time by the Board of Directors of HNC. However, Executive
shall
not be entitled to receive any additional compensation from HMS for
failure to take a vacation, nor shall Executive be able to accumulate
unused vacation time from one year to the next, except to the extent
authorized by the Board of Directors of
HNC.
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(d)
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Employee
Benefit Plans.
During the term of this Agreement, Executive shall be entitled to
participate in and receive the benefits of any Employee Benefit Plan
currently in effect at HMS at the level of comparable HMS executives,
until such time that the Board of Directors of HNC authorizes a change
in
such benefits. Nothing paid to Executive under any plan or arrangement
presently in effect or made available in the future shall be deemed
to be
in lieu of the salary payable to Executive pursuant to Section 4(a)
hereof.
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| (e) |
Business
Expenses.
During the term of this Agreement, Executive shall be entitled to
receive
six hundred dollars ($600) per month car allowance and prompt
reimbursement for all reasonable expenses incurred by him, which
are
properly accounted for, in accordance with the policies and procedures
established by the Board of Directors of HNC for its executive
officers.
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5. Termination
of Employment Following Change in Control.
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(a)
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If
a Change in Control (as defined in Section 5(b) of this Agreement)
shall
occur and if thereafter at any time during the term of this Agreement
there shall be:
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(i)
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any
involuntary termination of Executive’s employment (other than for the
reasons set forth in Section 3(b) or 3(d) of this Agreement);
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(ii)
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any
reduction in Executive’s title, responsibilities, including reporting
responsibilities, or authority, including such title, responsibilities
or
authority as such title, responsibilities or authority may be increased
from time to time during the term of this
Agreement;
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(iii)
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the
assignment to Executive of duties inconsistent with Executive’s office on
the date of the Change in Control or as the same may be increased
from
time to time after the Change in
Control;
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(iv)
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any
reassignment of Executive to a location greater than fifty (50) miles
from
the location of Executive’s office on the date of the Change in
Control;
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(v)
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any
reduction in Executive’s Annual Base Salary in effect on the date of the
Change in Control or as the same may be increased from time to time
after
the Change in Control;
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(vi)
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any
failure to provide Executive with benefits at least as favorable
as those
enjoyed by Executive under any of HMS’s retirement or pension, life
insurance, medical, health and accident, disability or other employee
plans in which Executive participated at the time of the Change in
Control, or the taking of any action that would materially reduce
any of
such benefits in effect at the time of the Change in Control;
or
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(vii)
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any
requirement that Executive travel in performance of his duties on
behalf
of HNC or any of its subsidiaries or affiliates for a significantly
greater period of time during any year than was required of Executive
during the year preceding the year in which the Change in Control
occurred.
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then,
at
the option of Executive, exercisable by Executive within one hundred twenty
(120) days of the occurrence of any of the foregoing events, Executive may
resign from employment with HMS (or, if involuntarily terminated, give notice
of
intention to collect benefits under this Agreement) by delivering such notice
in
writing (the “Notice of Termination”) to HMS and the provisions of Section 6 of
this Agreement shall apply.
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(b)
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As
used in this Agreement, “Change in Control” shall mean the occurrence of
any of the following:
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(i)
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(A)
a merger, consolidation or division involving HNC only (not the Bank),
(B)
a sale, exchange, transfer or other disposition of substantially
all of
the assets of HNC only (not the Bank), or (c) a purchase by HNC only
(not
the Bank) of substantially all of the assets of another entity, unless
(x)
such merger, consolidation, division, sale, exchange, transfer, purchase
or disposition is approved in advance by seventy percent (70%) or
more of
the members of the Board of Directors of HNC only (not the Bank)
who are
not interested in the transaction and (y) a majority of the members
of the
Board of Directors of the legal entity resulting from or existing
after
any such transaction and of the Board of Directors of such entity’s parent
corporation, if any, are former members of the Board of Directors
of HNC
only (not the Bank); or
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(ii)
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any
other change in control of HNC only (not the Bank) similar in effect
to
any of the foregoing.
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| 6. |
Rights
in Event of Termination of Employment Following Change in
Control.
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(a)
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In
the event that Executive delivers a Notice of Termination (as defined
in
Section 5(a) of this Agreement) to HMS only (not the Bank), Executive
shall be absolutely entitled to receive the compensation and benefits
set
forth below:
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If,
at
the time of termination of Executive’s employment, a “Change in Control” (as
defined in Section 5(b) of this Agreement) has also occurred, HMS shall pay
Executive an amount equal to and no greater than 2.0
times
the
Executive’s Agreed Compensation as defined in subsection (g) of Section 3, which
amount shall be payable in twenty-four (24) equal monthly installments. In
addition, Executive shall be entitled to a continuation of HMS’s employee
benefits for twenty-four (24) months or until Executive secures substantially
similar benefits through other employment, whichever shall first occur. If
Executive is no longer eligible to participate in an employee benefit plan
because he no longer is an employee, HMS will pay Executive the amount of money
that it would have cost HMS to provide the benefits to Executive. However,
in
the event the payment described herein, when added to all other amounts or
benefits provided to or on
-14-
behalf
of
the Executive in connection with his termination of employment, would result
in
the imposition of an excise tax under Code Section 4999, such payments shall
be
retroactively (if necessary) reduced to the extent necessary to avoid such
excise tax imposition. Upon written notice to Executive, together with
calculations of HMS’s independent auditors, Executive shall remit to HMS the
amount of the reduction plus such interest as may be necessary to avoid the
imposition of such excise tax. Notwithstanding the foregoing or any other
provision of this contract to the contrary, if any portion of the amount herein
payable to the Executive is determined to be non-deductible pursuant to the
regulations promulgated under Section 280G of the Code, then HMS shall be
required only to pay to Executive the amount determined to be deductible under
Section 280G.
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(b)
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Executive
shall not be required to mitigate the amount of any payment provided
for
in this Section 6 by seeking other employment or otherwise. Unless
otherwise agreed to in writing, the amount of payment or the benefit
provided for in this Section 6 shall not be reduced by any compensation
earned by Executive as the result of employment by another employer
or by
reason of Executive’s receipt of or right to receive any retirement or
other benefits after the date of termination of employment or
otherwise.
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| 7. |
Rights
in Event of Termination of Employment Absent Change in
Control.
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(a)
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In
the event that Executive’s employment is involuntarily terminated by HMS
without Cause and no Change in Control shall have occurred at the
date of
such termination, upon execution of a mutual release, HMS shall pay
Executive an amount equal to and no greater than 1.0
times
the Executive’s Agreed Compensation as defined in subsection (g) of
Section 3, and shall be payable in twelve (12) equal monthly installments.
In addition, Executive shall be entitled to a continuation of HMS’s
employee benefits for twelve (12) months or until Executive secures
substantially similar benefits through other employment, whichever
shall
first occur. If Executive is no longer eligible to participate in
an
employee benefit plan because he is no longer an employee, HMS will
pay
Executive the amount of money that it would have cost HMS to provide
the
benefits to Executive.
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If
the payment described herein, when added to all other amounts or
benefits
provided to or on behalf of the Executive in connection with his
termination of employment, would result in the imposition of an excise
tax
under Code Section 4999, such payments shall be retroactively (if
necessary) reduced to the extent necessary to avoid such imposition.
Upon
written notice to Executive, together with calculations of HMS’s
independent auditors, Executive shall remit to HMS the amount of
the
reduction plus such interest as may be necessary to avoid the imposition
of such excise tax. Notwithstanding the foregoing or any other
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provision
of this contract to the contrary, if any
portion of the amount herein payable to the Executive is determined to be
non-deductible pursuant to the regulations promulgated under Section 280G of
the
Code, then HMS shall be required only to pay to Executive the amount determined
to be deductible under Section 280G.
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(b)
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Executive
shall not be required to mitigate the amount of any payment provided
for
in this Section 7 by seeking other employment or otherwise. The amount
of
payment or the benefit provided for in this Section 7 shall not be
reduced
by any compensation earned by Executive as the result of employment
by
another employer or by reason of Executive’s receipt of or right to
receive any retirement or other benefits after the date of termination
of
employment or otherwise.
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(c)
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The
amounts payable pursuant to this Section 7 shall constitute Executive’s
sole and exclusive remedy in the event of involuntary termination
of
Executive’s employment by HMS in the absence of a Change in
Control.
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8. Covenant
Not to Compete
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(a)
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Executive
hereby acknowledges and recognizes the highly competitive nature
of the
business of HNC and accordingly agrees that, during his employment
and for
a period of one year following the date of termination of Executive’s
employment, regardless of the reason for termination, Executive shall
not:
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(i)
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be
engaged, directly or indirectly, either for his own account or as
agent
consultant, employee, partner, officer, director, proprietor, investor
(except as an investor owning less than 5% of the stock of a publicly
owned company) or otherwise of any person, firm, corporation or enterprise
engaged in (1) the banking industry (including bank and financial
holding
company), or (2) any other activity in which HNC or any of its
subsidiaries are engaged during the Employment Period, in any county
in
which, at any time during the Employment Period or at the date of
termination of the Executive’s employment, a branch, office or other
facility of HNC or any of its subsidiaries is located, or in any
county
contiguous to such a county, including contiguous counties located
outside
of the Commonwealth of Pennsylvania (the “Non-Competition Area”);
or
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(ii)
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provide
financial or other assistance to any person, firm, corporation, or
enterprise engaged in (1) the banking industry (including bank and
financial holding company), or (2) any other activity in which HNC
or any
of its subsidiaries are engaged during the Employment Period, in
the
Non-Competition Area; or
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(iii)
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directly
or indirectly contact, solicit or induce any person, corporation
or
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other
entity who or which is a customer or referral
source of HNC or any of its subsidiaries or affiliates, during the term of
Executive’s employment or on the date of termination of Executive’s
employment to become a customer or referral source of any person or entity
other
then HNC or one of its subsidiaries or affiliates; or
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(iv)
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directly
or indirectly solicit, induce or encourage any employee of HNC or
any of
its subsidiaries or affiliates, who is employed during the term of
Executive’s employment or on the date of termination of Executives
employment, to leave the employ of HNC or any of its subsidiaries
or
affiliates, or to seek, obtain or accept employment with any person
or
entity other than HNC or any of their subsidiaries or affiliates.
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(b)
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It
is expressly understood and agreed that, although Executive and HNC
consider the restrictions contained in Section 8(a) hereof reasonable
for
the purpose of preserving for HNC and its subsidiaries their good
will and
other proprietary rights, if a final judicial determination is made
by a
court having jurisdiction that the time or territory or any other
restriction contained in Section 8(a) hereof is an unreasonable or
otherwise unenforceable restriction against Executive, the provisions
of
Section 8(a) hereof shall not be rendered void but shall be deemed
amended
to apply as to such maximum time and territory and to such other
extent as
such court may judicially determine or indicate to be
reasonable.
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9.
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Unauthorized
Disclosure.
During the term of his employment hereunder, or at any later time,
the
Executive shall not, without the written consent of the Board of
Directors
of HNC or a person authorized thereby, knowingly disclose to any
person,
other than an employee of the HNC or a person to whom disclosure
is
reasonably necessary or appropriate in connection with the performance
by
the Executive of his duties as an executive of HNC, any material
confidential information obtained by him while in the employ of HMS
with
respect to any of HNC’s services, products, improvements, formulas,
designs or styles, processes, customers, methods of business or any
business practices the disclosure of which could be or will be damaging
to
HNC; provided, however, that confidential information shall not include
any information known generally to the public (other than as a result
of
unauthorized disclosure by the Executive or any person with the
assistance, consent or direction of the Executive) or any information
of a
type not otherwise considered confidential by persons engaged in
the same
business of a business similar to that conducted by HNC or any information
that must be disclosed as required by
law.
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10.
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Work
Made for Hire.
Any work performed by the Executive under this Agreement should be
considered a “Work Made for Hire” as that phrase is defined by the U.S.
patent laws and its subsidiaries and affiliates. In the event it
should be
established that such work does not qualify as a Work Made for Hire,
the
Executive agrees to and does hereby assign to HNC and its affiliates
and
subsidiaries, all of his rights, title, and/or interest in
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such
work product, including, but not limited to, all
copyrights, patents, trademarks, and property rights.
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11.
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Return
of Company Property and Documents.
The Executive agrees that, at the time of termination of his employment,
regardless of the reason for termination, he will deliver to HNC
and its
subsidiaries and affiliates, any and all company property, including,
but
not limited to, automobiles, keys, security codes or passes, mobile
telephones, pagers, computers, devices, confidential information,
records,
data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, software programs, equipment, other
documents or property, or reproductions of any of the aforementioned
items
developed or obtained by the Executive during the course of his
employment.
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12.
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Liability
Insurance. HNC
shall use its best efforts to obtain insurance coverage for the Executive
under an insurance policy covering officers and directors of HNC
against
lawsuits, arbitrations or other legal or regulatory proceedings;
however
nothing herein shall be construed to require HNC to obtain such insurance,
if the Board of Directors of HNC determine that such coverage cannot
be
obtained at a reasonable price.
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13.
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Notices.
Except as otherwise provided in this Agreement, any notice required
or
permitted to be given under this Agreement shall be deemed properly
given
if in writing and if mailed by registered or certified mail, postage
prepaid with return receipt requested, to Executive’s residence, in the
case of notices to Executive, and to the principal executive offices
of
HNC, in the case of notices to HNC.
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14.
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Waiver.
No
provision of this Agreement may be modified, waived or discharged
unless
such waiver, modification or discharge is agreed to in writing and
signed
by Executive and an executive officer specifically designated by
the Board
of Directors of HNC. No waiver by either party hereto at any time
of any
breach by the other party hereto of, or compliance with, any condition
or
provision of this Agreement to similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.
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15.
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Assignment.
This Agreement shall not be assignable by any party, except by HNC
to any
successor in interest to their respective
businesses.
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16.
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Entire
Agreement.
This Agreement contains the entire agreement of the parties relating
to
the subject matter of this
Agreement.
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17. Successors;
Binding Agreement.
|
(a)
|
HNC
will require any successor (whether direct or indirect, by purchase,
merger, consolidation, or otherwise) to all or substantially all
of the
businesses and/or assets of HNC to expressly assume and agree to
perform
this Agreement in the same manner and to the same extent that HNC
would be
required to perform it if no such succession had taken place. Failure
by
HNC to obtain such assumption
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and
agreement prior to the effectiveness of any such
succession shall constitute a breach of this Agreement and the provisions of
Section 3 of this Agreement shall apply. As used in this Agreement, “HNC” shall
mean Harleysville National Corporation, as defined previously and any successor
to its respective businesses and/or assets as aforesaid which assumes and agrees
to perform this Agreement by operation of law or otherwise.
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(b)
|
This
Agreement shall inure to the benefit of and be enforceable by Executive’s
personal or legal representatives, executors, administrators, heirs,
distributees, devisees and legatees. If Executive should die after
a
Notice of Termination is delivered by Executive, or following termination
of Executive’s employment without Cause, and any amounts would be payable
to Executive under this Agreement if Executive had continued to live,
all
such amounts shall be paid in accordance with the terms of this Agreement
to Executive’s devisee, legatee, or other designee, or, if there is no
such designee, to Executive’s
estate.
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18. Arbitration.
HNC and Executive recognize that in the event a dispute should arise
between
them concerning the interpretation or implementation of this Agreement, lengthy
and expensive litigation will not afford a practical resolution of the issues
within a reasonable period of time. Consequently, each party agrees that all
disputes, disagreements and questions of interpretation concerning this
Agreement (except for any enforcement sought with respect to Sections 8, 9,
10
or 11, which may be litigated in court through an action for an injunction
or
other relief) are to be submitted for resolution, in Xxxxxxxxxx County,
Pennsylvania, to the American Arbitration Association (the “Association”) in
accordance with the Association’s National Rules for the Resolution of
Employment Disputes or other applicable rules then in effect (“Rules”). HNC or
Executive may initiate an arbitration proceeding at any time by giving notice
to
the other in accordance with the Rules. HNC and Executive may, as a matter
or
right, mutually agree on the appointment of a particular arbitrator from the
Association’s pool. The arbitrator shall not be bound by the rules of evidence
and procedure of the courts of the Commonwealth of Pennsylvania but shall be
bound by the substantive law applicable to this Agreement. The decision of
the
arbitrator, absent fraud, duress, incompetence or gross and obvious error of
fact, shall be final and binding upon the parties and shall be enforceable
in
courts of proper jurisdiction. Following written notice of a request for
arbitration, HNC and Executive shall be entitled to an injunction restraining
all further proceedings in any pending or subsequently filed litigation
concerning this Agreement, except as otherwise provided herein or any
enforcement sought with respect to Sections 8, 9, 10 or 11, which may be
litigated through an action for injunction or other relief.
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19.
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Validity.
The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision
of
this Agreement, which shall remain in full force and
effect.
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20.
|
Applicable
Law.
This
Agreement shall be governed by and construed in accordance with the
domestic, internal laws of the Commonwealth of Pennsylvania, without
regard to its conflicts of laws
principles.
|
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21.
|
Headings.
The section headings of this Agreement are for convenience only and
shall
not control or affect the meaning or construction or limit the scope
or
intent of any of the provisions of this
Agreement.
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IN
WITNESS WHEREOF,
the
parties have executed this Agreement as of the date first above
written.
ATTEST: HARLEYSVILLE
MANAGEMENT
SERVICES,
LLC
_/s/
Xxxxxxx Xxxxxxxx-Xxxxxxx By
/s
/
Xxx Xxxxxx
Xxx
Xxxxxx, SVP Human
Resources
WITNESS: EXECUTIVE
/s/
Xxxxx Xxxx Xxx By
/s/
Xxxxx X. Xxx
Xxxxx
X.
Xxx
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