EMPLOYMENT AGREEMENT
AGREEMENT made and entered into as of this 24 day of December, 1996 by
and between Beverly National Corporation, a Massachusetts corporation having
its principal place of business in Beverly, Massachusetts ("Company"), and
Xxxxx X. Xxxxxxxx of Wenham, Massachusetts the ("Employee").
WITNESSETH THAT:
WHEREAS, the Employee is currently employed by the Company and has been
employed by the Company since March 15, 1984; and
WHEREAS, the Employee has been employed by The Xxxxxxx National Bank, a
wholly-owned subsidiary of the Company (the "Bank") for over twenty five years;
and
WHEREAS, the services of the Employee, the Employee's experience and
knowledge of the affairs of the Bank and the Company and the Employee's
reputation and contacts in the banking industry are valuable to the Company and
its subsidiaries; and
WHEREAS, the Company desires to employ the Employee in an executive
capacity in the conduct of its business until her scheduled retirement date,
and desires to retain her services as a consultant after that date, in
accordance with the terms of a Consulting Agreement; and
WHEREAS, the Employee desires to be so employed.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Term. The period of employment of the Employee under this Agreement
shall be deemed to commence as of the first above written and shall continue
in effect through June 30, 1999 Employee's scheduled retirement date.
2. Capacity. (a) At all times during the term hereof, the Company shall
employ the Employee as Vice President and Clerk, and shall cause the Bank to
employ Employee as its Vice President, Cashier and Chief Operations Officer.
In such capacities, the Employee shall be assigned only to such duties and
tasks as are appropriate for a person in such positions, and shall be subject
to the supervision of the President of the Company and the Bank, respectively.
Employee shall be employed on a full-time basis, and (subject to the last
sentence of this paragraph) the Employee shall devote her full time and
professional efforts to the performance of her duties as Vice President and
Clerk of the Company and any office she may hold in each of its subsidiaries.
It is the intention of the Company and the Employee that the Employee shall
have full discretionary authority of a Vice President and Clerk of the Company
and a Vice President, Cashier and Chief Operations Officer of the Bank. The
Company encourages participation by the Employee on community boards and
committees and in activities generally considered to be in the public interest,
but the Company shall have the right to approve the Employee's participation
on such other boards and committees as may conflict with the Company's own
business or demands upon the Employee's time.
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(b) During the period of her employment by the Company hereunder the
Employee agrees to serve as Vice President, Cashier and Chief Operations
Officer of the Bank without additional compensation, except for reimbursement
for all reasonable out-of-pocket expenses. In the event that during the term
of her employment the Employee is terminated as Vice President, Cashier or
Chief Operations Officer of the Bank, the Employee shall have the right to
resign as Vice President and Clerk of the Company in which case she shall be
entitled to the benefits set forth in Section 8(d) as though she had been
terminated involuntarily without cause.
3. Compensation and Benefits. (a) Base Compensation. The Company shall
pay to the Employee in equal monthly installments a base annual salary in the
amount of Eighty-Five Thousand ($85,000) Dollars. The base annual salary of
the Employee shall be adjusted upward from time to time in the sole discretion
of the Company, in which case such increased amount shall thereafter constitute
the Employee's base annual salary. It is the intention of the Company to
compensate the Employee at a level at least comparable to the compensation of
persons employed in the position of Vice President and Chief Operations Officer
of banks engaged in New England in activities substantially similar to those of
the Bank and having approximately the same combined gross assets as the Company
and its subsidiaries.
(b) Fringe Benefits. At all times during the term of this, the Company
shall provide or cause to be provided to the Employee fringe benefits
consistent with those provided for senior officers of the Company or the Bank.
The Employee shall maintain adequate records of all reimbursable expenses
necessary to satisfy reporting requirements of the Internal Revenue code and
applicable Treasury regulations.
4. Non-Competition. At all times during which the Employee is employed
by the Company under this Agreement and for a period of one (1) year
thereafter, the Employee shall not, directly or indirectly, as an employee of
any person or entity (whether or not engaged in business for profit),
individual proprietor, partner, stockholder, director, officer, joint venturer,
investor, lender or in any other capacity whatever (otherwise than as holder
of less than ten (10) percent of any securities publicly traded in the market)
compete within (i) the City of Beverly, Massachusetts, and the Town of
Hamilton, Massachusetts, or (ii) municipalities contiguous to the City of
Beverly, Massachusetts, or the Town of Hamilton, Massachusetts, or (iii) any
other Cities or Towns in which the Bank may locate during the term of this
Agreement, with the business of the Company or any of its subsidiaries, as
such businesses are constituted at any time during the term of this Agreement.
For purposes of this Section 4, Employee's ownership of or employment by an
institution doing business in Beverly, Massachusetts, Xxxxxxxx, Massachusetts,
in municipalities contiguous to Beverly or Hamilton or in such other Cities
or Towns, but having its principal place of business elsewhere, shall not
constitute competition hereunder so long as Employee does not solicit in
Beverly or Xxxxxxxx, in such contiguous municipalities, or in such other Cities
or Towns, as the case may be.
5. No Solicitation of Employees. At all times during which the Employee
is employed under this Agreement and for a period of one (1) year thereafter,
the Employee shall not, directly or indirectly, employ, attempt to employ,
recruit or otherwise solicit, induce or influence to leave her employment any
employee of the Company or its subsidiaries.
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6. No Disclosure of Information. The Employee shall not at any time
divulge, use, furnish, disclose or make accessible to anyone other than the
Company or any of its subsidiaries any knowledge or information with respect
to confidential or secret data, procedures or techniques of the Company or any
of its subsidiaries, provided, however, that nothing in this Section 6 shall
prevent the disclosure by Employee of any such information which at any time
comes into the public domain other than as a result of the violation of the
terms of this Section 6 by the Employee or which is otherwise lawfully acquired
by Employee.
7. Termination of Employment. This Agreement shall on the earliest to
occur of the following dates:
(a) The expiration of the term hereof;
(b) The Employee's resignation from the Company or the death or
disability of the Employee (the Employee being deemed to be disabled if she
has been unable for one hundred eighty (180) consecutive days to render
services required to be rendered by her during the term hereof);
(c) At the election of the Company, for Cause, as hereinafter
defined, after ten (10) business days' prior written notice of the basis
therefor to the Employee if during such period the Employee shall not have
cured the basis therefor. For purposes of this Agreement, the Company shall be
deemed to have "Cause" to terminate the employment of the Employee under this
Agreement only if:
(i) The Employee is convicted by a court of jurisdiction of any
criminal offense involving dishonesty or breach of trust;
(ii) The Employee shall commit an act of fraud materially
evidencing bad faith toward the Company or any of its
subsidiaries;
(iii) The Employee fails to substantially perform the duties
reasonably assigned to her by the President of the Company
(other than any such failure resulting from the Employee's
incapacity due to physical or mental illness) after a demand
for substantial performance is delivered to Employee by the
President which specifically identifies the manner in which
such officer believes that Employee has not substantially
performed such duties, making reference to this provision of
the Agreement.
8. Payments Upon Termination of Employment.
(a) Payment Upon Death. If at any time while she is employed hereunder
the Employee shall die, in addition to all other benefits which she or her
personal representatives may be entitled, the Company shall pay to her
designated beneficiary or, if no such beneficiary exists, to her estate, for
a period of three (3) months following the Employee's death, such amounts of
base annual salary as the Employee would have been entitled to receive during
said period (and at the times she would have been entitled to receive them)
had she remained alive.
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(b) Payments Upon Disability. If at any time during the term of this
Agreement, in the opinion of a physician mutually agreeable to the Company and
the Employee, the Employee shall be determined to be unable to render services
hereunder due to physical or mental illness or accident, in addition to all
other benefits to which she or her personal representatives may be entitled,
the Employee shall be entitled to receive all benefits payable to her under the
Bank's long term disability income plan.
(c) Payments Upon Expiration of Term. Upon expiration of the term of
this Agreement, the Employee shall be entitled to receive compensation through
the date of expiration. This Agreement does not limit Employee's rights to
benefits under all plans or programs of the Company or its subsidiaries in
which she participates, including without limitation pension, profit sharing,
401(k) and employee stock option plans, and the Retiree Medical Benefit Policy
approved December 28, 1993, the ("Retiree Medical Policy"), regardless of
whether such policy is subsequently changed except that Employee will be given
the benefit of favorable changes.
(d) Payment Upon Other Involuntary Termination. If at any time during
the term of this Agreement the employment of the Employee is terminated
involuntarily for any reason without Cause, as heretofore defined, then in such
case:
(i) Within five days after such termination, the Company shall pay
to the Employee (or to her personal representative in case of
death), in addition to all accrued and unpaid compensation
through the date of such termination, a lump sum amount equal
to Employee's base salary for the remaining term of this
Agreement, at the annual rate in effect as of the date of such
termination, plus $60,000.
(ii) The Company shall maintain or cause to be maintained in effect
for the Employee for a period of twelve months following such
termination, at the Company's sole expense, all group insurance
(including life, health, accident and disability insurance) and
all other employee benefit plans, programs or arrangements
(other than the Bank's retirement plan, the Bank's profit-
sharing and 401(k) plans, and the Company's employee stock
ownership plan), in which the Employee was participating at any
time during the twelve months preceding such termination,
provided, that in addition to the foregoing, Employee shall be
entitled to benefits under the Retiree Medical Policy, as
approved December 28, 1993, regardless of whether such policy
is subsequently changed, except that Employee shall be given the
benefit of favorable changes.
(iii) The Employee shall be entitled to receive, beginning at sixty-
five (65), a payment equal to the excess, if any, of (A) the
monthly amount to which the Employee would be entitled as a
Normal Retirement Benefit under the Xxxxxxx National Bank
Retirement Plan as in effect at the date of such termination
assuming the Employee had retired or terminated under that Plan
at the end of the term of this Agreement or, if earlier,
Employee's normal retirement date, over (B) any amounts actually
payable to the Employee under such Plan. Payments under this
paragraph (iii) shall be made at the same times and in the same
manner as any benefits payable under such Plan.
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(iv) The Employee shall not be required to mitigate the amount of any
payment provided for in this Section 8(d) by seeking employment
or otherwise.
In the event that the Employee's participation in any of the foregoing
plans, programs or arrangements (including those contemplated by Subsections
(c) and (d) hereof) is barred by law or otherwise, or in the event that any
such plan, program or arrangement is discontinued or the benefits thereunder
are materially reduced during such period, the Company shall provide the
Employee with benefits substantially similar to those to which the Employee was
entitled immediately prior to the date of her termination of employment. Upon
expiration of the period of coverage provided hereunder, the Employee shall be
provided with the opportunity to have assigned to her at no cost and with no
appointment of prepaid premiums any assignable insurance owned by the company
or any of its subsidiaries and relating specifically to the Employee.
9. Notices. Notices under this Agreement shall be in writing and shall
be mailed by registered or certified mail, effective upon receipt, addressed
as follows:
(a) To the Company: Beverly National Corporation
000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxxx 00000
ATTN: President
(b) To the Employee: Xxxxx X. Xxxxxxxx
000 Xxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Either party may by notice in writing change the address to which notices
to it or her are to be addressed hereunder.
10. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
Boston, Massachusetts, in accordance with the rules of the American Arbitration
Association then in effect. Notwithstanding the pendency of any such dispute
or controversy, the Company will pay Employee promptly an amount equal to her
full compensation in effect when the notice giving rise to the dispute was
given (including, but not limited to, base salary) and shall provide or cause
to be provided to the Employee all compensation, benefits and insurance plans
in which she was participating when the notice giving rise to the dispute was
given, until the dispute is finally resolved. Amounts paid under this Section
10 are in addition to all other amounts due under this Agreement and shall not
be offset against or reduce any other amounts under this Agreement. Judgment
may be entered on the arbitrator's award in any court having jurisdiction.
11. Miscellaneous.
(a) Indemnification. During the period of her employment hereunder,
the Company agrees to indemnify the Employee in her capacity as an officer of
the Bank, The Company, and each subsidiary of either, all to the maximum
extent permitted under the laws of the commonwealth of Massachusetts and
applicable banking rules and regulations. The provisions of the Section 11(a)
shall survive expiration or termination of this Agreement for any reason
whatsoever.
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(b) Legal Fees. The Company shall pay to Employee all reasonable
legal fees and expenses incurred by her in contesting or disputing any
termination of this Agreement or in seeking to obtain or enforce any right or
benefit provided by this Agreement, provided that the final resolution of such
matter principally is in Employee's favor.
(c) Entire Agreement. This Agreement constitutes the entire
Agreement between the parties and may not be changed except by a writing duly
executed and delivered by the Company and Employee in the same manner as the
Agreement. This Agreement does not limit Employee's rights under other
agreements with the Company or any subsidiary, including without limitation
the Consulting Agreement and the Supplemental Executive Retirement Agreement
executed on or about the date hereof.
(d) Governing Law. This Agreement is governed by and shall be
construed in accordance with the laws of the Commonwealth of Massachusetts.
Employee agrees that it supersedes in all respects any prior agreement between
the Company or the Bank and Employee.
(e) Binding Effect; Non-Assignability. This Agreement shall be
binding upon the Company and insure to the benefit of the Company and its
successors. Neither this Agreement or any rights arising hereunder may be
assigned or pledged by Employee during her lifetime. This Agreement shall
inure to the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devises and legatees.
IN WITNESS WHEREOF, the parties hereto have executed the within
instrument as a sealed document as of the date first above written.
ATTEST BEVERLY NATIONAL CORPORATION
/s/ Xxxx X. Good III /s/ Xxxxxxxx X. Xxxxx
______________________ By:___________________________
Chairman, Compensation President
Committee of the Board
of Directors
/s/ Xxxxx X. Xxxxxxxx
___________________________
Xxxxx X. Xxxxxxxx
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