Exhibit 10.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (hereinafter referred to as this "AGREEMENT"),
is entered into this __th of ________, 1997, by and between The Market
Building and Saving Company, a savings and loan association incorporated
under Ohio law (hereinafter referred to as the "EMPLOYER"), and Xxxx X.
Xxxxxxx, an individual (hereinafter referred to as the "EMPLOYEE");
WITNESSETH:
WHEREAS, the EMPLOYEE is currently employed as the President and
Managing Officer of the EMPLOYER;
WHEREAS, as a result of the skill, knowledge and experience of the
EMPLOYEE, the Board of Directors of the EMPLOYER desire to retain the
services of the EMPLOYEE as the President and Managing Officer of the
EMPLOYER;
WHEREAS, the EMPLOYEE desires to continue to serve as the President and
Managing Officer of the EMPLOYER; and
WHEREAS, the EMPLOYEE and the EMPLOYER desire to enter into this
AGREEMENT to set forth the terms and conditions of the employment
relationship between the EMPLOYER and the EMPLOYEE.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the EMPLOYER and the EMPLOYEE hereby agree as follows:
1. EMPLOYMENT AND TERM. Upon the terms and subject to the conditions of
this AGREEMENT, the EMPLOYER hereby employs the EMPLOYEE, and the EMPLOYEE
hereby accepts employment, as the President and Managing Officer of the
EMPLOYER. The term of this AGREEMENT shall commence on the date hereof, and
shall end on ____________, 2000 (hereinafter referred to as the "TERM"). In
January of each year, the Boards of Directors of the EMPLOYER shall review
the EMPLOYEE's performance and record the results of such review in the
minutes of the Boards of Directors. This AGREEMENT shall not be renewed or
extended without a taking of affirmative action by the Board of Directors of
the EMPLOYER to cause such renewal or extension. Any such extension shall be
subject to the written consent of the EMPLOYEE.
2. DUTIES OF EMPLOYEE.
(a) GENERAL DUTIES AND RESPONSIBILITIES. The EMPLOYEE shall serve as
the President and Managing Officer of the EMPLOYER. Subject to the direction
of the Board of Directors of the EMPLOYER, the EMPLOYEE shall have
responsibility for the general management and control of the business and
affairs of the EMPLOYER and shall perform
all duties and shall have all powers which are commonly incident to the
office of President and Managing Officer or which, consistent therewith, are
delegated to him by the Board of Directors. Such duties shall include, but
not be limited to, (1) managing the day-to-day operations of the EMPLOYER,
(2) managing the efforts of the EMPLOYER to comply with applicable laws and
regulations, (3) marketing of the EMPLOYER and its services, (4) supervising
other employees of the EMPLOYER, (5) providing prompt and accurate reports to
the Board of Directors of the EMPLOYER regarding the affairs and conditions
of the EMPLOYER, and (6) making recommendations to the Board of Directors of
the EMPLOYER concerning the strategies, capital structure, tactics, and
general operations of the EMPLOYER.
(b) DEVOTION OF ENTIRE TIME TO THE BUSINESS OF THE EMPLOYER. The
EMPLOYEE shall devote his entire productive time, ability and attention
during normal business hours throughout the TERM to the faithful performance
of his duties under this AGREEMENT. The EMPLOYEE shall not directly or
indirectly render any services of a business, commercial or professional
nature to any person or organization other than the EMPLOYER and Market
Financial Corporation without the prior written consent of the Board of
Directors of the EMPLOYER; provided, however, that the EMPLOYEE shall not be
precluded from (i) vacations and other leave time in accordance with Section
3(d) hereof; (ii) reasonable participation in community, civic, charitable or
similar organizations; or (iii) the pursuit of personal investments which do
not interfere or conflict with the performance of the EMPLOYEE's duties to
the EMPLOYER. Nothing in this section shall limit the EMPLOYEE's right to
invest in securities of any business that does not provide services or
products of the type or competing with those provided by the EMPLOYER or its
subsidiaries or affiliates.
3. COMPENSATION, BENEFITS AND REIMBURSEMENTS.
(a) SALARY. The EMPLOYEE shall receive during the TERM an annual
salary payable in equal installments not less often than monthly. The amount
of such annual salary shall be $________ until changed by the Board of
Directors of the EMPLOYER in accordance with Section 3(b) of this AGREEMENT.
(b) ANNUAL SALARY REVIEW. In January of each year throughout the TERM,
the annual salary of the EMPLOYEE shall be reviewed by the Board of Directors
of the EMPLOYER and shall be set at an amount not less than $_____________,
based upon the EMPLOYEE's individual performance and the overall
profitability and financial condition of the EMPLOYER (hereinafter referred
to as the "ANNUAL REVIEW"). The results of the ANNUAL REVIEW shall be
reflected in the minutes of the Board of Directors of the EMPLOYER.
(c) EMPLOYEE BENEFIT PROGRAM. During the TERM, the EMPLOYEE shall be
entitled to participate in all formally established employee benefit, bonus,
pension and profit-sharing plans and similar programs that are maintained by
the EMPLOYER from time to time, and all employee benefit plans or programs
hereafter adopted in writing by the Board of Directors of
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the EMPLOYER, for which senior management personnel are eligible including
any employee stock ownership plan, stock option plan or other stock benefit
plan (hereinafter collectively referred to as the "BENEFIT PLANS").
Notwithstanding any statement to the contrary contained elsewhere in this
Agreement, the EMPLOYER may discontinue or terminate at any time any such
BENEFIT PLANS, now existing or hereafter adopted, to the extent permitted by
the terms of such plans and shall not be required to compensate the EMPLOYEE
for such discontinuance or termination.
(d) VACATION AND SICK LEAVE. The EMPLOYEE shall be entitled, without
loss of pay, to be absent voluntarily from the performance of his duties
under this AGREEMENT, in accordance with the policies periodically
established by the Boards of Directors of the EMPLOYER for senior management
officials of the EMPLOYER. The EMPLOYEE shall not be entitled to receive any
additional compensation from the EMPLOYER in the event of his failure to take
the full allotment of vacation time in any calendar year. In the event that
any sick leave time shall not have been used during any calendar year, such
leave shall accrue to subsequent calendar years, only to the extent
authorized by the Boards of Directors of the EMPLOYER. Upon termination of
employment, the EMPLOYEE shall not be entitled to receive any additional
compensation from the EMPLOYER for unused sick leave.
4. TERMINATION OF EMPLOYMENT.
(a) GENERAL. In addition to the termination of the employment of the
EMPLOYEE upon the expiration of the TERM, the employment of the EMPLOYEE
shall terminate at any other time during the TERM upon the delivery by the
EMPLOYER of written notice of employment termination to the EMPLOYEE.
Without limiting the generality of the foregoing sentence, the following
subparagraphs (i), (ii) and (iii) of this Section 4(a) shall govern the
obligations of the EMPLOYER to the EMPLOYEE upon the occurrence of the events
described in such subparagraphs:
(i) TERMINATION FOR JUST CAUSE. In the event that the EMPLOYER
terminates the employment of the EMPLOYEE during the TERM because of the
EMPLOYEE's personal dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure or refusal to
perform the duties and responsibilities assigned in this AGREEMENT, willful
violation of any law, rule, regulation or final cease-and-desist order (other
than traffic violations or similar offenses), conviction of a felony or for
fraud or embezzlement, or material breach of any provision of this AGREEMENT
(hereinafter collectively referred to as "JUST CAUSE"), the EMPLOYEE shall
not receive, and shall have no right to receive, any compensation or other
benefits for any period after such termination.
(ii) TERMINATION AFTER CHANGE OF CONTROL. In the event that,
before the expiration of the TERM and in connection with or within one year
after a CHANGE OF CONTROL (as defined hereinafter) of the EMPLOYER or Market
Financial Corporation, (A) the employment of the EMPLOYEE is terminated for
any reason other than JUST CAUSE before the expiration of the TERM, (B) the
present capacity or circumstances in which the EMPLOYEE is employed are
materially changed before the expiration of the TERM, or (C)
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the EMPLOYEE's responsibilities, authority, compensation or other benefits
provided under this AGREEMENT are materially reduced, then the following
shall occur:
(I) The EMPLOYER shall promptly pay to the EMPLOYEE or
to his beneficiaries, dependents or estate an amount equal to the sum of (1)
the amount of compensation to which the EMPLOYEE would be entitled for the
remainder of the TERM under this AGREEMENT, plus (2) the difference between
(x) the product of three, multiplied by the greater of the annual salary set
forth in Section 3(a) of this AGREEMENT or the annual salary payable to the
EMPLOYEE as a result of any ANNUAL REVIEW, less (xx) the amount paid to the
EMPLOYEE pursuant to clause (1) of this subparagraph (I);
(II) The EMPLOYEE, his dependents, beneficiaries and
estate shall continue to be covered under all BENEFIT PLANS of the EMPLOYER
at the EMPLOYER's expense as if the EMPLOYEE were still employed under this
AGREEMENT until the earliest of the expiration of the TERM or the date on
which the EMPLOYEE is included in another employer's benefit plans as a
full-time employee; and
(III) The EMPLOYEE shall not be required to mitigate
the amount of any payment provided for in this AGREEMENT by seeking other
employment or otherwise, nor shall any amounts received from other employment
or otherwise by the EMPLOYEE offset in any manner the obligations of the
EMPLOYER hereunder, except as specifically stated in subparagraph (II).
In the event that payments pursuant to this subsection (ii) would
result in the imposition of a penalty tax pursuant to Section 280G(b)(3) of
the Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder (hereinafter collectively referred to as "SECTION
280G"), such payments shall be reduced to the maximum amount which may be
paid under SECTION 280G without exceeding such limits. Payments pursuant to
this subsection also may not exceed the limit set forth in Regulatory
Bulletin 27a of the Office of Thrift Supervision.
(iii) TERMINATION WITHOUT CHANGE OF CONTROL. In the event that
the employment of the EMPLOYEE is terminated before the expiration of the
TERM other than (A) for JUST CAUSE or (B) in connection with or within one
year after a CHANGE OF CONTROL, the EMPLOYER shall be obligated to continue
(1) to pay on a monthly basis to the EMPLOYEE, his designated beneficiaries
or his estate, his annual salary provided pursuant to Section 3(a) or (b) of
this AGREEMENT until the expiration of the TERM and (2) to provide to the
EMPLOYEE, at the EMPLOYER's expense, health, life, disability, and other
benefits substantially equal to those being provided to the EMPLOYEE at the
date of termination of his employment until the earliest to occur of the
expiration of the TERM or the date the EMPLOYEE becomes employed full-time by
another employer. In the event that payments pursuant to this subsection
(iii) would result in the imposition of a penalty tax pursuant to SECTION
280G, such payments shall be reduced to the maximum amount which may be paid
under SECTION 280G without
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exceeding those limits. Payments pursuant to this subsection also may not
exceed the limit set forth in Regulatory Bulletin 27a of the Office of Thrift
Supervision.
(b) DEATH OF THE EMPLOYEE. The TERM automatically termi nates upon the
death of the EMPLOYEE. In the event of such death, the EMPLOYEE's estate
shall be entitled to receive the compensation due the EMPLOYEE through the
last day of the calendar month in which the death occurred, except as
otherwise specified herein.
(c) "GOLDEN PARACHUTE" PROVISION. Any payments made to the EMPLOYEE
pursuant to this AGREEMENT or otherwise are subject to and conditioned upon
their compliance with 12 U.S.C. Section 1828(k) and any regulations promulgated
thereunder.
(d) DEFINITION OF "CHANGE OF CONTROL". A "CHANGE OF CONTROL" shall mean
any one of the following events; (i) the acquisition of ownership or power to
vote more than 25% of the voting stock of the EMPLOYER or Market Financial
Corporation; (ii) the acquisition of the ability to control the election of a
majority of the directors of the EMPLOYER or Market Financial Corporation;
(iii) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the EMPLOYER or
Market Financial Corporation cease for any reason to constitute at least
two-thirds thereof; provided, however, that any individual whose election or
nomination for election as a member of the Board of Directors of the EMPLOYER
or Market Financial Corporation was approved by a vote of at least two-thirds
of the directors then in office shall be considered to have continued to be a
member of the Board of Directors of the EMPLOYER or Market Financial
Corporation; or (iv) the acquisition by any person or entity of "conclusive
control" of the EMPLOYER within the meaning of 12 C.F.R. Section 574.4(a), or
the acquisition by any person or entity of "rebuttable control" within the
meaning of 12 C.F.R. Section 574.4(b) that has not been rebutted in
accordance with 12 C.F.R. Section 574.4(c). For purposes of this paragraph,
the term "person" refers to an individual or corporation, partnership, trust,
association, or other organization, but does not include the EMPLOYEE and any
person or persons with whom the EMPLOYEE is "acting in concert" within the
meaning of 12 C.F.R. Part 574.
5. SPECIAL REGULATORY EVENTS. Notwithstanding Section 4 of this AGREEMENT,
the obligations of the EMPLOYER to the EMPLOYEE shall be as follows in the
event of the following circumstances:
(a) If the EMPLOYEE is suspended and/or temporarily prohibited from
participating in the conduct of the EMPLOYER's affairs by a notice served
under section 8(e)(3) or (g)(1) of the Federal Deposit Insurance Act
(hereinafter referred to as the "FDIA"), the EMPLOYER's obligations under
this AGREEMENT shall be suspended as of the date of service of such notice,
unless stayed by appropriate proceedings. If the charges in the notice are
dismissed, the EMPLOYER may, in its discretion, pay the EMPLOYEE all or part
of the compensation withheld while the obligations in this AGREEMENT were
suspended and reinstate, in whole or in part, any of the obligations that
were suspended;
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(b) If the EMPLOYEE is removed and/or permanently prohibited from
participating in the conduct of the EMPLOYER's affairs by an order issued
under Section 8(e)(4) or (g)(1) of the FDIA, all obligations of the EMPLOYER
under this AGREEMENT shall terminate as of the effective date of such order;
provided, however, that vested rights of the EMPLOYEE shall not be affected
by such termination;
(c) If the EMPLOYER is in default, as defined in sec tion 3(x)(1) of
the FDIA, all obligations under this AGREEMENT shall terminate as of the date
of default; provided, however, that vested rights of the EMPLOYEE shall not
be affected; and
(d) All obligations under this AGREEMENT shall be terminated, except to
the extent of a determination that the continuation of this AGREEMENT is
necessary for the continued operation of the EMPLOYER, (i) by the Director of
the Office of Thrift Supervision (hereinafter referred to as the "OTS"), or
his or her designee at the time that the Federal Deposit Insurance
Corporation enters into an agreement to provide assistance to or on behalf of
the EMPLOYER under the authority contained in Section 13(c) of the FDIA or
(ii) by the Director of the OTS, or his or her designee, at any time the
Director of the OTS approves a supervisory merger to resolve problems related
to the operation of the EMPLOYER or when the EMPLOYER is determined by the
Director of the OTS to be in an unsafe or unsound condition. No vested
rights of the EMPLOYEE shall not be affected by any such action.
6. CONSOLIDATION, MERGER OR SALE OF ASSETS. Nothing in this AGREEMENT
shall preclude the EMPLOYER or Market Financial Corporation from
consolidating with, merging into, or transferring all, or substantially all,
of their assets to another corporation that assumes all of their obligations
and undertakings hereunder. Upon such a consolidation, merger or transfer of
assets, the term "EMPLOYER" as used herein, shall mean such other corporation
or entity, and this AGREEMENT shall continue in full force and effect.
7. CONFIDENTIAL INFORMATION. The EMPLOYEE acknowledges that during his
employment he will learn and have access to confidential information
regarding the EMPLOYER and its customers and businesses. The EMPLOYEE agrees
and covenants not to disclose or use for his own benefit, or the benefit of
any other person or entity, any confidential information, unless or until the
EMPLOYER consents to such disclosure or use or such information is otherwise
legally in the public domain. The EMPLOYEE shall not knowingly disclose or
reveal to any unauthorized person any confidential information relating to
the EMPLOYER, its subsidiaries, or affiliates, or to any of the businesses
operated by them, and the EMPLOYEE confirms that such information constitutes
the exclusive property of the EMPLOYER. The EMPLOYEE shall not otherwise
knowingly act or conduct himself (a) to the material detriment of the
EMPLOYER, its subsidiaries, or affiliates, or (b) in a manner which is
inimical or contrary to the interests of the EMPLOYER.
8. NON-ASSIGNABILITY. Neither this AGREEMENT nor any right or interest
hereunder shall be assignable by the EMPLOYEE, his beneficiaries or legal
representatives without the EMPLOYER's prior written consent; provided,
however, that nothing in this Section 8 shall preclude (a) the EMPLOYEE from
designating a beneficiary to receive any benefits payable
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hereunder upon his death, or (b) the executors, administrators, or other
legal representatives of the EMPLOYEE or his estate from assigning any rights
hereunder to the person or persons entitled thereto.
9. NO ATTACHMENT. Except as required by law, no right to receive payment
under this AGREEMENT shall be subject to antici pation, commutation,
alienation, sale, assignment, encumbrance, charge, pledge or hypothecation or
to execution, attachment, levy, or similar process of assignment by operation
of law, and any attempt, voluntary or involuntary, to effect any such action
shall be null, void and of no effect.
10. BINDING AGREEMENT. This AGREEMENT shall be binding upon, and inure to
the benefit of, the EMPLOYEE and the EMPLOYER and its respective permitted
successors and assigns.
11. AMENDMENT OF AGREEMENT. This AGREEMENT may not be modified or amended,
except by an instrument in writing signed by the parties hereto.
12. WAIVER. No term or condition of this AGREEMENT shall be deemed to have
been waived, nor shall there be an estoppel against the enforcement of any
provision of this AGREEMENT, except by written instrument of the party
charged with such waiver or estoppel. No such written waiver shall be deemed
a continuing waiver, unless specifically stated therein, and each waiver
shall operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any act
other than the act specifically waived.
13. SEVERABILITY. If, for any reason, any provision of this AGREEMENT is
held invalid, such invalidity shall not affect the other provisions of this
AGREEMENT not held so invalid, and each such other provision shall, to the
full extent consistent with applicable law, continue in full force and
effect. If this AGREEMENT is held invalid or cannot be enforced, then any
prior AGREEMENT between the EMPLOYER (or any predecessor thereof) and the
EMPLOYEE shall be deemed reinstated to the full extent permitted by law, as
if this AGREEMENT had not been executed.
14. HEADINGS. The headings of the paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation
of any of the provisions of this AGREEMENT.
15. GOVERNING LAW. This AGREEMENT has been executed and delivered in the
State of Ohio and its validity, interpretation, performance, and enforcement
shall be governed by the laws of this State of Ohio, except to the extent
that federal law is governing.
16. EFFECT OF PRIOR AGREEMENTS. This AGREEMENT contains the entire
understanding between the parties hereto and supercedes any prior employment
agreement between the EMPLOYER or any predecessor of the EMPLOYER and the
EMPLOYEE.
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17. NOTICES. Any notice or other communication required or permitted
pursuant to this AGREEMENT shall be deemed delivered if such notice or
communication is in writing and is delivered personally or by facsimile
transmission or is deposited in the United States mail, postage prepaid,
addressed as follows:
If to the EMPLOYER:
The Market Building and Saving Company
0000 Xxxxxxxx Xxxxxx
Xx. Xxxxxxx, Xxxx 00000
Attn: Secretary
If to the EMPLOYEE:
Xx. Xxxx X. Xxxxxxx
0000 Xxxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
with copies to:
Xxxx X. Xxxxx, Esq.
Vorys, Xxxxx, Xxxxxxx and Xxxxx
Atrium Tow, Suite 2100
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
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IN WITNESS WHEREOF, the EMPLOYER has caused this AGREEMENT
to be executed by its duly authorized officer, and the EMPLOYEE
has signed this AGREEMENT, each as of the day and year first
above written.
Attest: The Market Building and Saving Company
_______________________ ______________________________________
By:___________________________________
its _______________________________
Attest:
________________________ ______________________________________
Xxxx X. Xxxxxxx
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