Exhibit 10.21
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made effective as of the 23rd day of December, 2002, by
and between XX X. XXXX (the Executive), an individual residing in Lenoir City,
Tennessee, and UNITED COMMUNITY BANKS, INC. (United), a Georgia corporation
doing business as a bank holding company in Georgia, North Carolina, and
Tennessee.
WHEREAS, United wishes to assure itself of the services of Executive
for the period provided in this Agreement; and
WHEREAS, Executive is willing to serve in the employment of United as
provided in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:
1. POSITION AND RESPONSIBILITIES.
During the period of his employment hereunder, Executive agrees to serve,
at the pleasure of United, as the Chairman of the Board of Directors of
United Community Bank (of Tennessee) (the Bank) and to perform such other
duties as may be requested or required by United, including, without
limitation, the oversight of United's expansion activities in Tennessee,
the oversight of and attention to Executive's commercial loan customers,
and public relations for United and the Bank in Tennessee (the Duties).
Executive shall report directly to Xx. Xxxxx Xxxxxxx or his successor.
2. TERM.
The term of this Agreement (the Term) shall be deemed to have commenced as
of the date of the consummation of the merger of First Central Bancshares,
Inc. with and into United and shall continue until July 10, 2005, the date
of Executive's seventieth (70th) birthday, unless this Agreement shall be
terminated otherwise as provided herein. During the Term, except for
periods of absence occasioned by illness, vacation periods, and leaves of
absence, taken by Executive upon notice to Xx. Xxxxxxx or his successor,
Executive shall devote the majority of his business time, attention, and
skill to the faithful performance of the Duties hereunder; provided,
however, that Executive shall not be required to keep specific business
hours or days and may control his own schedule with respect to the
performance of the Duties.
3. COMPENSATION AND REIMBURSEMENT.
The compensation specified under this Agreement shall constitute the salary
and benefits paid for the Duties described in Sections 1 and 2. United
shall pay Executive no less than One Hundred Twenty-five Thousand Dollars
($125,000.00) per year for each year of the Term. Upon the execution of
that certain Agreement and Plan of Reorganization by and between United and
First Central Bancshares, Inc., Executive shall be paid One Hundred Fifty
Thousand Dollars ($150,000.00) and shall receive options to purchase Five
Thousand (5,000) shares of United
common stock pursuant to the terms of a separate Option Agreement to be
executed by the parties. The option price per share shall be at the same
price per share as paid in connection with the merger with First Central
Bancshares, Inc. Executive shall be entitled to the following additional
benefits during the Term:
a. Executive shall have the option to maintain health insurance
through his current health insurance plan (in which event United
shall pay the premiums) or transfer his health insurance to
United's plan (in which event United shall also pay the
premiums);
b. Executive shall be entitled to such other benefits as may be
provided by United to other Bank employees;
c. Executive shall be reimbursed for expenses (meals, entertainment,
travel and other business expenses reasonable and necessary to
carry out his duties hereunder) and for gasoline during the Term
but shall not charge mileage or have a Bank or United-owned
vehicle;
d. United shall pay the annual dues for the social clubs of which
Executive is currently a member;
e. Executive shall be provided an office in the Bank for his
exclusive use during the Term;
f. United shall continue to employ Executive's assistant, Ms.
Xxxxxxx Xxxx, during the Term at no less than her current salary
and benefits; notwithstanding the foregoing, nothing herein shall
be construed to modify or limit the provisions of Xx. Xxxx'x
existing employment agreement with the Bank; and
g. Executive shall be permitted to attend customary banking
conventions and meetings during the Term at United's expense.
4. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION.
In the event of Executive's disability, death, or in the event that either
party desires to terminate this Agreement (an or the Event of Termination),
Executive (or his estate) shall be paid compensation in the amount of One
Hundred Thousand Dollars ($100,000.00) per year until July 10, 2005, which
amount shall be payable within fifteen (15) days of such Event of
Termination for that year and on the same day of each subsequent applicable
year; however, in 2005, not later than July 10, 2005. Additionally,
Executive shall receive Fifty Thousand Dollars ($50,000.00) per year until
Executive shall have reached the age of seventy-five (75). In the event of
Executive's death during this period, Executive's estate shall receive, in
lump sum, the remaining compensation due under this Section. By way of
example only, should an Event of Termination occur on March 31, 2004,
Executive would be entitled to receive $75,000.00 ( pro rata for the
remaining months and days of 2004), plus $52,777.78 for the remaining
months and days until July 10, 2005, plus $250,000 for the years 2006-2010
(5 x $50,000), for a total of $377,777.78. In the event of Executive's
death, this amount would accrue to his estate according to this formula.
5. DISABILITY.
Disability, under the terms of this Agreement, shall have the meaning as
defined in United's then current disability plan; if no such plan is then
in effect, if the Executive is permanently and totally disabled within the
meaning of Section 22(e)(3) of the Internal Revenue Code as determined by a
physician designated by United, United may terminate Executive's employment
for Disability. Executive shall be entitled to payment as provided in
Section 4 of this Agreement.
6. NOTICE.
Any purported termination by either party hereto shall be communicated by
Notice of Termination to the other party. For purposes of this Agreement, a
Notice of Termination shall mean a written notice which shall indicate the
specific termination provision in this Agreement relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of Executive's employment under the provision so
indicated. Date of Termination shall mean (A) if Executive's employment is
terminated for Disability, thirty (30) days after a Notice of Termination
is given (provided that Executive shall not have returned to the
performance of his duties on a full-time basis during such thirty (30) day
period); and (B) if his employment is terminated for any other reason, the
date specified in the Notice of Termination.
7. NON-COMPETITION AND NON-DISCLOSURE.
a. Upon any termination of Executive's employment hereunder for any
reason, including but not limited to expiration of this
Agreement, Executive agrees not to compete with the Bank or
United during any period in which Executive shall be entitled to
compensation under this Agreement (the Non-Competition Period).
Executive shall not work for or advise, consult or otherwise
serve with, directly or indirectly, any entity whose business
materially competes with the depository, lending or other
business activities of the Bank or United. Executive further
specifically agrees that he will not, for the Non-Competition
Period, work in either a paid or unpaid capacity with any
individual or group proposing to establish a new bank or other
financial institution in the Bank's market area in Tennessee. The
parties hereto, recognizing that irreparable injury will result
to United, its business and property in the event of Executive's
breach of this Section, agree that in the event of any such
breach by Executive, United will be entitled, in addition to any
other remedies and damages available, to an injunction to
restrain the violation hereof by Executive. Executive represents
and admits that in the event of the termination of his employment
hereunder that Executive can obtain employment in a business
engaged in other lines and/or of a different nature than the Bank
and that the enforcement of a remedy by way of injunction will
not prevent Executive from earning a living.
b. Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Bank
and United and affiliates thereof, as it may exist from time to
time, is a valuable, special and unique asset of the business of
United. Executive will not, during or after the Term, disclose
any knowledge of the past, present, planned, or considered
business activities of
United or the Bank or affiliates thereof to any person, firm,
corporation, or other entity for any reason or purpose
whatsoever. Notwithstanding the foregoing, Executive may disclose
any knowledge of banking, financial and/or economic principles,
concepts or ideas that are not solely and exclusively derived
from the business plans and activities of United or the Bank. In
the event of a breach or threatened breach by Executive of the
provisions of this Section, United shall be entitled to an
injunction restraining Executive from disclosing, in whole or in
part, the knowledge of the past, present, planned or considered
business activities of United or the Bank or affiliates thereof,
or from rendering any services to any person, firm, corporation,
or other entity to whom such knowledge, in whole or in part, has
been disclosed or is threatened to be disclosed.
8. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS.
This Agreement contains the entire understanding between the parties
thereto and supercedes any prior employment agreement, written or oral,
between Executive and First Central Bank (the predecessor name of United
Community Bank (of Tennessee)) or United. No provision of this Agreement
shall be interpreted to mean that Executive is subject to receiving fewer
benefits from United than those available to him without reference to this
Agreement.
9. NO ATTACHMENT; SUCCESSORS AND ASSIGNS.
Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy or similar process or assignment by operation of law, and
any attempt, voluntary or involuntary, to affect such an action shall be
null, void, and of no effect.
This Agreement shall be binding upon, and shall inure to the benefit of,
Executive and United and their respective successors and assigns.
10. MODIFICATION AND WAIVER.
This Agreement may not be modified or amended except by an instrument in
writing signed by the parties hereto. No term or condition of this
Agreement shall be deemed to have been waived, nor shall there by any
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 such 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 as to any act other than that specifically waived.
11. SEVERABILITY.
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other
provision of this Agreement or any part of such provision not held so
invalid, and each such other provision and part thereof shall, to the full
extent consistent with law, continue in full force and effect.
12. HEADINGS FOR REFERENCE ONLY.
The headings of sections and 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.
13. GOVERNING LAW.
This Agreement shall be governed by the substantive laws and procedural
provisions of the State of Tennessee, unless otherwise specified herein;
provided, however, that in the event of a conflict between the terms of
this Agreement and any applicable federal or state law or regulation, the
provisions of such law or regulation shall prevail.
14. PAYMENT OF LEGAL FEES.
All reasonable legal fees paid or incurred by United or Executive pursuant
to any dispute or question or interpretation relating to this Agreement
shall be paid or reimbursed by the prevailing party.
15. INDEMNIFICATION.
United shall provide Executive with coverage under a standard directors'
and officers' liability insurance policy at its expense and shall indemnify
Executive to the fullest extent permitted under applicable law and United's
and the Bank's charters and bylaws against all expenses liabilities
reasonably incurred by him in connection with or arising out of any action,
suit, or proceeding initiated by a person or entity not a party to this
Agreement in which he may be involved by reason of his having been an
officer or director of the Bank (whether or not he continues to be an
officer or director at the time of incurring such expense or liabilities),
and that is a result of actions or omissions taken or omitted in the course
and scope of his Duties as an officer or director of the Bank. Such
expenses and liabilities include, but are not limited to, judgment, court
costs, and reasonable attorneys' fees and the cost of reasonable
settlement.
16. SUCCESSOR TO UNITED OR BANK.
United shall require any successor or assignee, whether direct or indirect,
by purchase, merger, consolidation or otherwise, to all or substantially
all the business or assets of the Bank or United, expressly and
unconditionally to assume and agree to perform United's obligations under
this Agreement, in the same manner and to the same extent that United would
be required to perform if no such succession or assignment had taken place.
IN WITNESS WHEREOF, United has caused this Agreement to be executed by a
duly authorized officer or director, and Executive has signed this
Agreement, effective on the date first written above.
UNITED COMMUNITY BANKS, INC.
By: /s/ Xxxxx Xxxxxxx
Print name and title:Xxxxx Xxxxxxx
President and CEO
XX X. XXXX
/s/ Xx X. Xxxx
Witness: /s/ Xxxxxxx Xxxx
