EXHIBIT 10.8
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") is made
this 22nd day of December, 1997, by and between FIRST CHARTER NATIONAL BANK, a
national banking association (the "Bank"), and XXXX X. XXXXXXX, XX., of Shelby,
North Carolina (the "Employee").
Statement of Purpose
Employee currently is a party to that certain Employment Agreement dated
November 13, 1990 (the "Existing Agreement") between Employee and Carolina State
Bank, a corporation organized and existing under the laws of the State of North
Carolina ("CSB"). As of the close of business on December 22, 1997, CSB will
merge with and into the Bank (the "Merger"), and Employee's employment with and
the separate corporate existence of CSB will cease. Under the Existing
Agreement, Employee is generally obligated to remain employed by the Bank, as
successor by merger with CSB, through November 12, 2001. The Bank desires to
employ Employee and Employee desires to be employed to provide services to the
Bank pursuant to the terms of this Agreement. The Bank and Employee have agreed
that, in consideration of the Bank's agreement to limit Employee's employment
with the Bank for a period of approximately one year, the additional
consideration to Employee set forth in Section 4(b) and 10(d) hereof and the
other terms and conditions of this Agreement, Employee and the Bank shall enter
into this Amended and Restated Employment Agreement, which amends, restates and
supersedes the Existing Agreement in its entirety.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed as follows:
1. Employment. Effective December 23, 1997, the Bank agrees to employ
Employee during the term set forth in Section 2 hereof and Employee accepts
employment by the Bank, as an executive employee with the initial title of
Executive Vice President, subject to and upon the terms and conditions of this
Agreement. This Agreement supersedes any prior employment agreements, including
without limitation the Existing Agreement.
2. Term. The term of Employee's employment created by this Agreement shall
be for a term commencing as of December 23, 1997 and terminating December 31,
1998, unless sooner terminated as hereinafter provided in Section 8 below.
3. Duties. Employee agrees, during the term of his employment hereunder, to
use his best efforts, skills and abilities to promote the Bank's business and
interest and to perform such duties reasonably assigned to him from time to time
by the Board of Directors of the Bank (the "Board"). During the term of his
employment hereunder, Employee shall primarily devote his business time,
attention and energies, reasonable vacations excepted, to the business of the
Bank and
the performance of his duties hereunder. Further, during the term of his
employment hereunder, Employee shall not be engaged in or connected with,
directly or indirectly, any business activity or the performance of his duties
hereunder, without the prior written approval of the Board. Also, upon request
of the Board, Employee will disclose all business activities or commercial
pursuits in which Employee may be engaged, other than Bank duties.
4. Compensation. (a) As compensation for his services rendered hereunder,
during the term of Employee's employment hereunder, the Bank shall pay Employee
an annual base salary of $125,000, payable in accordance with the Bank's normal
payroll procedures.
(b) The Bank and Employee acknowledge and agree that, although pursuant to
Section 2(b) of the Existing Agreement, a change of control of CSB will occur
upon consummation of the Merger, in consideration of the additional
consideration to Employee set forth in this Section and Section 10(d) below, the
Bank's agreement to limit Employee's employment with the Bank for a period of
one year and the other terms and conditions of this Agreement, the provisions of
paragraph 2(b) of the Existing Agreement are hereby void and are expressly
waived. However, as additional compensation for Employee's employment with the
Bank under this Agreement, the Bank agrees to pay Employee a total amount equal
to $250,000, payable in accordance with the Bank's normal payroll procedures in
48 equal semi-monthly installments beginning with the first calendar month
following the expiration of the term of his employment under this Agreement;
provided, however, that Employee hereby expressly agrees that he shall not be
entitled to any benefits under this Section 4(b), and the Bank shall not be
obligated to make any payments hereunder, if Employee's employment terminates or
ends prior to December 31, 1998 for any reason other than earlier termination of
such employment pursuant to Section 8(a)(i) or Section 8(a)(ii) hereof.
5. Deferred Compensation. The Bank shall provide Employee with such
deferred compensation as is provided in that certain Amended and Restated Salary
Continuation Agreement dated as of the date hereof by and between the Bank and
Employee.
6. Benefits. (a) During the term of Employee's employment hereunder,
Employee shall be entitled to all so-called "fringe benefits" in the nature of
sick leave, pension plans, and the like, which may generally be provided by the
Bank for its employees. However, during the term of Employee's employment
hereunder, Employee (i) shall be entitled to minimum vacation time of four
weeks, and (ii) shall be provided, at Bank's cost, (A) family health care
insurance to the maximum extent available under a full family health care plan;
(B) short-term disability insurance for a period not to exceed 180 days with
coverage for full based salary for such period; and (C) long-term disability
insurance with coverage for two-thirds of Employee's annual base salary to age
sixty-five (when added to social security benefits).
(b) During the term of Employee's employment hereunder, the Bank shall
provide Employee a reasonable automobile as determined by the Board to enable
him to perform his services hereunder and shall defray reasonable expenses of
operation of such automobile for business purposes; provided, however, that
Employee may, as additional compensation, use such automobile for personal
purposes, provided Employee maintains records of such personal use for tax
purposes.
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In addition, the Bank shall reimburse Employee for reasonable out-of-pocket
business expenses incurred by Employee in performance of his duties under this
Agreement on behalf of the Bank. The Bank also agrees during the term of
Employee's employment hereunder to pay all reasonable dues and expenses incurred
by Employee with respect to memberships in clubs and organizations of which
Employee currently is a member and which are business in nature, but the Bank
shall not pay for any such expenses which are of a personal nature to Employee
or Employee's family or associates.
7. Deductions from Payments. Any payments made to Employee hereunder shall
be subject to such deductions as are from time to time required pursuant to
governmental law, regulations or order, and which may be agreed to by the Bank
and Employee.
8. Termination. (a) In addition to the termination of this Agreement and
the expiration of the term specified in Section 2, Employee's employment created
hereby and the Bank's obligations hereunder shall terminate immediately upon the
earlier of:
(i) Employee's death;
(ii) Employee's disability, as provided in Section 9;
(iii) The dissolution of the Bank or discontinuance of its business;
or
(iv) The dismissal of Employee for cause, as provided in Section 8(b)
below.
(b) The Bank shall have the right to terminate the employment of Employee
hereunder for cause upon written notice to him specifying the cause. Thereupon,
all of the Bank's obligations under this Agreement shall terminate. "Cause"
shall mean:
(i) Any act of dishonesty, fraud or neglect of job duties by Employee
in connection with his employment with the Bank or against any parent,
affiliate or subsidiary company of the Bank;
(ii) Any conviction, guilty plea or plea of nolo contendere by
Employee for any crime involving moral turpitude or for any felony, if the
Board of Directors reasonably deems that such conviction or plea may have a
significant adverse effect upon the Bank or any parent, affiliate or
subsidiary company of the Bank or upon Employee's ability to perform under
this Agreement;
(iii) Repeated use of alcohol during or after working hours that
materially interferes with Employee's duties under this Agreement, use of
illegal drugs or violation of the Bank's drug and/or alcohol policies by
Employee;
(iv) Excessive absenteeism not related to illness, authorized
family/medical leave or vacation;
(v) An intentional violation by Employee of the Bank policies, rules
or instructions;
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(vi) Insubordination or Employee's unwillingness or failure to carry
out the reasonable performance criteria established by the Board of
Directors from time to time;
(vii) The breach or threatened breach of any provision of this
Agreement by Employee or under any other agreement between Employee and the
Bank; or
(viii) The occurrence of any event or circumstance which would prevent
the Bank from obtaining a fidelity bond with respect to Employee's
performance of his duties hereunder.
(c) On termination of Employee's employment hereunder, the Bank shall pay
all compensation theretofore accrued under this Agreement and, unless expressly
provided otherwise herein, or expressly provided otherwise as a standard feature
of a benefit program of general applicability to its employees or in a signed,
written agreement approved by the Board, Employee shall have no further right
for any salary, compensation or other benefits hereunder, including without
limitation any payments under Section 4(b) or Section 10(d) hereof.
Notwithstanding any such termination, the obligations and restrictions imposed
on Employee pursuant to Sections 10 and 11 shall survive any termination of
employment.
9. Disability. If it is determined by the Bank that Employee is unable,
with or without a reasonable accommodation, to perform the essential functions
and duties of his position with the Bank under this Agreement because of a
physical or mental disability, impairment or condition, other than death, that
has continued for more than four (4) consecutive months, then Bank, in its sole
discretion, may notify Employee or his representative of the same in writing,
and thereupon this Agreement and Employee's employment hereunder shall
terminate. A determination of the nature and extent of Employee's disability,
impairment or condition under this section may be made at the request of either
the Bank or Employee; provided, however, that in the event Employee is unable,
due to his disability, impairment or condition to make such a request, his
spouse or other designee may make a request in his stead, whereupon each of
Employee (or Employee's designee) and the Bank shall designate one doctor to
participate in the determination. If the two doctors so designated agree on a
determination required by this Section, such determination shall be final. If
the two doctors fail to agree, they shall by agreement designate a third doctor
to make the determination required by this Section, which determination shall be
final.
10. Noncompetition. (a) During the term of his employment hereunder and for
a period of two years after his employment hereunder has terminated or ended
(whatever the reason for the end of the employment relationship), Employee shall
not own any interest in (except for ownership of a minor percentage of stock in
a "public" competitor), operate, serve as an employee, director, operator or
contractor of, consult with, advise or otherwise represent in any capacity any
"bank or savings and loan association" (as those terms may be defined from time
to time by federal or state law applicable thereto) with respect to such an
institution's operations or business anywhere within Cleveland County, North
Carolina, or within a 15 mile radius of any Bank office (present or future)
outside of Cleveland County, North Carolina that exists at the time of the end
of Employee's employment under this Agreement, unless such activity is approved
in advance by the Board.
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(b) During the term of his employment hereunder and for a period of two
years after his employment hereunder has terminated or ended (whatever the
reason for the end of the employment relationship), Employee shall not engage in
any business activities engaged in by the Bank of the type with which Employee
was involved at the time of the Merger and/or during the term of this Agreement,
including but not limited to the performance of banking executive duties, within
Cleveland County, North Carolina or within a 15 mile radius of any Bank office
(present or future) outside of Cleveland County, North Carolina that exists at
the time of the end of Employee's employment under this Agreement, unless such
activity is approved in advance by the Board.
(c) If the scope of any restrictions contained in Section 10(a) or Section
10(b), including without limitation the scope of any geographic and time
limitation, is determined by a court of competent jurisdiction to be too broad
to permit enforcement thereof to their fullest extent, then such restrictions
shall be enforced to the maximum extent permitted by law, and Employee hereby
consents and agrees that such scope and other provisions of this Section 10 may
be modified or "blue pencilled" judicially in any other proceeding brought to
enforce such restriction.
(d) In consideration of the covenants contained in Section 10(a) and
Section 10(b), the Bank agrees to pay Employee a total amount equal to $125,000,
payable in accordance with the Bank's normal payroll procedures in 48 equal
semi-monthly installments beginning with the first calendar month following the
expiration of the term of his employment under this Agreement; provided,
however, that Employee shall not be entitled to any benefits under this Section
10(d), and the Bank shall not be obligated to make any payments hereunder, if
Employee's employment terminates or ends prior to December 31, 1998 for any
reason.
11. Non-Disclosure and Return of Information. Employee acknowledges that
the work performed by the Bank and the Employee involves confidential and
proprietary information, business forecasts, competitive analyses, pricing
policies, or the substance of agreements with customers or customer lists, and
Employee agrees that he will not (a) misappropriate, (b) use for the purpose of
competing with the Bank, either directly or indirectly, (c) disclose to any
third party, either directly or indirectly, or (d) aid anyone else in disclosing
to any third party, either directly or indirectly, all or any part of any
information of a confidential or competitively sensitive nature about the work
of the CSB or Bank, including but not limited to, all information concerning the
Bank's customers, financial information, operating results, contracts, plans and
projections for business opportunities for new or developing business, personnel
matters, salary information, or any other confidential or proprietary processes,
ideas, plans, patents or trade secrets, except to other Bank personnel and
others who have a genuine need to know such information to render assistance to
the Bank under appropriate confidentiality restrictions or understandings.
Employee understands that he will be liable to the Bank for any damages caused
by an unauthorized disclosure of such information. Employee further agrees. that
upon the termination or end of his employment with the Bank, Employee will
deliver to the Bank all electronic or other records, memoranda, data and other
media or materials of every kind and character and all copies thereof,
regardless of how maintained, which are in the Employee's possession or control,
and which are the property of the Bank and/or which relate to his employment or
to the activities of the Bank, including, but not limited to, drawings, prints,
manuals, software, notebooks, reports and correspondence.
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12. Legal and Equitable Relief. In the event of a breach or threatened
breach by Employee of the provisions contained in Sections 10 and 11, Employee
agrees and understands that he shall forfeit and the Bank shall be entitled to
cease any and all payments pursuant to this Agreement, and the Bank shall be
entitled to injunctive relief, without bond, to restrain Employee from breaching
or continuing to breach such provisions, and to such other and further relief as
may be proper. Nothing herein shall be construed as prohibiting the Bank from
pursuing any other remedies available to the Bank, for the breach or threatened
breach of Sections 10 and 11, including the recovery of damages from Employee.
13. Severability. If any provision of this Agreement, or the application
thereof to either party is held illegal, unenforceable, or otherwise invalid in
any respect by government promulgation, operation of law, court decree or
otherwise, such holding(s) shall not affect the other provisions or applications
of this Agreement which can be given effect without the invalid provision. In
addition, if any one or more of the provisions of this Agreement regarding
restrictions of future employment be deemed invalid, such provisions shall be
construed in a manner to enable it to be enforced to the extent allowed by
applicable law.
14. Inurement. This Agreement shall be binding on and shall inure to the
benefit of the parties hereto and their respective heirs, legal representatives,
successors and assigns except to the extent that the right to assign the
Agreement is limited by Section 15 below.
15. Assignment. Employee recognizes and agrees that this Agreement is a
contract for personal services with the Bank and none of Employee's obligations
under this Agreement may be assigned or delegated by him. This Agreement may be
assigned by the Bank; provided, however, that such assignee shall assume all of
the Bank's obligations to Employee hereunder.
16. Attorney's Fees. In the event that either party seeks judicial
enforcement of the Agreement, and thereby obtains legal or equitable relief or
both, the prevailing party shall be entitled to recover from the other party the
reasonable attorney's fees and costs paid or to be paid by such party related to
such enforcement. Further, each party consents and agrees to venue and service
of process in any state court and federal court in the State of North Carolina.
17. Governing Law. This Agreement has been executed in and shall be
governed by the laws of the State of North Carolina.
(Signatures on following page.)
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IN WITNESS WHEREOF, the parties hereto have executed and delivered
duplicate copies of this Agreement, each of which is deemed to be an original,
as of the date and year first above written.
FIRST CHARTER NATIONAL BANK
By: /s/ XXXXXXXX X. XXXXXXXXX
-----------------------------------------
Xxxxxxxx X. Xxxxxxxxx
President and Chief Executive Officer
[Corporate Seal]
ATTEST:
/s/ XXXX X. XXXXXXX
-----------------------------
Assistant Corporate Secretary
EMPLOYEE:
XXXX X. XXXXXXX, XX.
/s/ XXXX X. XXXXXXX, XX. (SEAL)
-----------------------------
Signature
000 Xxxxxxx Xxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
-----------------------------
Address
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