EXHIBIT - 10.1
EMPLOYMENT AGREEMENT
This employment agreement (the "Agreement"), effective as of July 31, 1999
(the "Effective Date"), between American National Bank and Trust Company (the
"Company"), a national banking association with its principal office at 000 Xxxx
Xxxxxx, Xxxxxxxx, XX 00000-0000 and Xxxxx X. Xxxxxxx, Xx. ("Executive").
WHEREAS, the Company and Executive desire to enter into this Agreement for
the purpose of clearly, correctly and completely stating the terms of
Executive's employment by the Company;
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants herein contained, the Company and Executive agree as follows:
1. Employment. The Company hereby employs Executive and Executive hereby
accepts such employment on the terms and conditions hereinafter set forth.
2. Term. Subject to the respective rights of the Company and Executive
under Paragraph 9 to terminate his employment, Executive shall serve the Company
for a period beginning on the Effective Date and continuing for a period of
three years (the "Term of Employment").
3. Duties. Executive shall serve as Vice President and City Executive. He
shall have responsibility for private banking in the Martinsville/Xxxxx County
area. He will also serve on the board of directors of Mutual Mortgage of the
Piedmont, Inc. and advise the Company on matters concerning Mutual Mortgage of
Piedmont, Inc. Executive shall also render such additional services and duties
consistent with his position as may be assigned to him from time to time by the
Company's President and Chief Executive Officer. During the Term of Employment,
Executive shall devote his full time, attention and efforts to the business of
the Company and shall use his best efforts to promote the interests of the
Company at all times. This shall not be construed to prevent Executive from
personally, and for his own account and benefit, trading in stocks, bonds,
securities (including securities of publicly traded financial institutions so
long as, in the case of entities that are not affiliates of the Company,
Executive's holdings represent less than one percent of any such entity's issued
and outstanding securities), real estate, commodities or other forms of
investment so long as such activities do not interfere with Executive's duties
as an Executive of the Company.
4. Compensation.
(a) The Company agrees to pay Executive, for services rendered hereunder in
his capacity as Vice President and City Executive, a salary at the annual base
salary (exclusive of any profit sharing, bonus stock award, or incentive
payments) of eighty-four thousand dollars ($84,000) during the first year of
this Agreement. Such amount shall be payable in semi-monthly installments, less
any sums which may be required to be deducted or withheld under applicable law.
(b) Executive shall be eligible for consideration for an increase in base
salary each calendar year. The amount of the increase in base salary, if any,
shall be determined by the Salary Committee of the Company's board of directors.
(c) Executive shall be eligible to participate in the Company's profit
sharing plan and incentive compensation program on the same basis as other
officers of the Company. Executive shall be guaranteed at least ninety thousand
dollars ($90,000) total compensation on an annualized basis, including his base
salary set forth above. Profit sharing and incentive compensation plans are
subject to the approval of the Company's board of directors each calendar year.
Although subject to change, profit sharing is currently payable on a quarterly
basis and incentive compensation is payable at the end of the calendar year.
(d) At the August 1999 meeting of the board of directors of American
National Bankshares, Inc., the Company's President and Chief Executive Officer
will recommend to the Stock Option Committee of the board of directors that it
grant Executive an option to purchase 3,000 shares of the common stock of
American National Bankshares, Inc. at market value, as determined on the date of
the grant, under the American National Bankshares, Inc. Stock Option Plan. Such
option shall vest 50% on December 31, 1999, and 50% on December 31, 2000.
5. Benefits. The Company agrees to provide benefits to Executive which are
the same as those currently provided to other officers of the Company holding
positions commensurate with the office of Executive, and such other benefits as
the Company may from time to time, in is discretion provide to Executive.
6. Expenses. The Company shall reimburse Executive for all reasonable
expenses incurred in connection with the performance of his duties for the
Company, within such limits and standards as may from time to time be set by the
Company.
7. Vacation. Executive shall be entitled to three weeks of vacation each
calendar year (in addition to the established public or statutory holidays). For
calendar year 1999, this amount will be prorated. Upon termination of
Executive's employment, he shall be entitled to accrued vacation pay (to the
extent such vacation time has not been used) for any vacation days not taken
during the year of termination. Vacation days not taken in any twelve-month
period shall be forfeited and not carried forward.
8. Non-Competition and Confidentiality. The Executive acknowledges and
agrees that during the course of his employment by the Company he will obtain
access to certain information, know-how, designs, formulas, processes,
technology or other matters relating to the Company's business, research, design
activities, development, products, or its production, marketing, accounting or
processing methods, not generally known by the public or in the relevant
industry ("Confidential Information") and that because of such access,
competition by him with the Company could result in material damage to the
Company and might cause it to suffer irreparable damage.
Executive agrees that during the Term of Employment (whether or not his
employment continues through the end of such period), that he shall not directly
or indirectly, alone or as an employee, independent contractor or consultant of
any type, an owner, partner, employee, stockholder, or holder of any option or
right to become a stockholder in or owner of any entity or organization, officer
or director of any firm or business entity, engage in any business activity in
the Martinsville/Xxxxx County area which is the same as or similar to the
business of the Company or any division, affiliate or subsidiary thereof, nor
will Executive, without the prior written approval of the Company's Board of
Directors, for himself or on behalf of any other person, firm, partnership or
corporation, actively seek to persuade any director, officer, or employee of the
Company to discontinue that individual's status or employment with the Company
in order to become employed in any activities similar to or competitive with the
business of the Company, nor will Executive solicit any such person for such
purpose. To the extent provided in Paragraph 3 above, this provision shall not
be construed to prevent Executive from personally and or his own account and
benefit, trading in stocks, bonds, securities, real estate, commodities or other
forms of investment.
Executive also agrees that at all times, whether after termination of his
employment by the Company or otherwise, he will keep in confidence and not
disclose to anyone or make any use of any Confidential Information without the
Company's prior written consent, except as he reasonably believes may be
necessary in the ordinary course of performing duties for the Company or unless
such Confidential Information becomes public knowledge through no fault of
Executive.
Executive acknowledges and agrees that the observance by him of his
covenants contained in this Paragraph 8 is so important to the continued success
of the business of the Company that in the event of a breach or threatened
breach by Executive of such covenants the Company will not have an adequate
remedy at law, and accordingly shall be entitled to proceed in equity to obtain
specific enforcement of such covenants, including but not limited to injunctions
restraining Executive from breaching such covenants; provided that this sentence
shall not be construed as a waiver by the Company of any other remedies
available to it for such breach or threatened breach, including, but not limited
to the recovery of damages from Executive.
On termination of employment, Executive will deliver to the Company all
records, reports, data, memoranda and notes of any nature that are in his
possession or under his control and that are prepared or acquired in the course
of his employment relationship with the Company and will not knowingly take with
him any of the foregoing or any reproduction thereof or of any Confidential
Information.
The prohibitions of this Paragraph 8 and any of its provisions are
severable, and a finding by any court that any provision of this Paragraph 8 is
unenforceable shall not affect the validity of any other covenant set forth
herein. Additionally, should any court find that the provisions of this
Paragraph 8 are unenforceable, Executive and the Company agree that the court
may modify the restrictions contained herein and prohibit Executive from
engaging in such activities as the court finds necessary to protect the
Company's interests.
9. Termination. The Term of Employment may be terminated by the Company at
any time or for any reason. Unless such termination is on account of death or
disability of Executive or for "good cause", the Company shall pay Executive a
"termination payment" as described below.
Disability shall mean Executive is unable to perform the customary duties
of his position for a consecutive period of six months due to a physical or
mental illness. In the event a dispute arises between Executive and the Company
concerning Executive's physical or mental ability to continue or return to the
performance of his duties, Executive shall submit to examination by a competent
physician mutually agreeable to the parties, and his or her opinion as to
Executive's capability to so perform will be final and binding.
The Company shall be deemed to have "good cause" to terminate Executive's
employment if the Company determines that Executive
(a) has violated Paragraph 3 or 8;
(b) has refused or failed to perform the duties of his position or other
duties which have been assigned to him;
(c) is guilty of personal dishonesty, gross incompetence, willful
misconduct, a breach of a fiduciary duty involving personal profit, intentional
failure to perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses), unethical
business practices in connection with the Company's business, misappropriation
of the Company's or any affiliate's assets (determined on a reasonable basis) or
is subject to a final cease-and-desist order, or has been convicted of a felony
or a misdemeanor involving moral turpitude; or
(d) is guilty of a material breach of any other provision of this
Agreement, provided that Executive has received written notice from the Company
of such material breach and such breach remains uncured thirty days after the
delivery of such notice.
In the event of a termination for death, disability or good cause, other
than amounts payable with respect to services actually rendered, the Company
shall owe Executive no further salary, benefits or other compensation of any
kind after the Company provides notice to Executive of termination. The
obligations of Executive under Paragraph 8 shall survive such termination,
whether made by the Company or by Executive.
"Termination payment" means the balance of Executive's base salary due for
the Term of Employment.
10. Effectiveness of Agreement. This Agreement shall be binding on and
inure to the benefit of the Company and its successors and assigns. This
Agreement shall be binding upon and shall inure to the benefit of the Company
and any successor to the Company, and any such successor to the Company shall be
deemed substituted for the Company under this Agreement. No assignment by the
Company hereunder shall release the Company from its obligations pursuant to
Paragraph 4 hereof in the event the Company's successor fails to satisfy such
obligations. For purposes of this Agreement, the term "successor" shall mean any
person, firm, corporation or other business entity which at any time, whether by
merger, purchase, liquidation or otherwise, shall acquire all or substantially
all of the assets or business of the Company. The obligations of the Executive
hereunder are hereby expressly declared to be nonassignable and nontransferable.
11. Severability. The failure of any court to enforce any clause, paragraph
or provision of this Agreement shall not adversely affect the validity or
enforceability of any other clause or provision.
12. Entire Agreement. This Agreement sets forth the entire agreement of the
parties with respect to the employment contemplated hereby and supersedes all
prior agreements, arrangements and understandings with respect thereto between
the Company and Executive. No modification, amendment, addition to or
termination of this Agreement, nor waiver of any of its provisions shall be
valid or enforceable unless in writing and signed by both parties.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which
constitute one instrument.
14. Headings. The underlined headings herein are for convenience only and
shall not affect the interpretation of this Agreement.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Virginia.
16. Notice. Any notice to be delivered under this Agreement shall be given
in writing and delivered personally or by leaving the same at or by sending the
same first-class mail, postage prepaid:
(a) in the case of the Company:
American National Bank And Trust Company
P. O. Xxx 000
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx
President & Chief Executive Officer
(b) in the case of Executive, at his most recent address as shown in the
Company's records;
(c) in the case of either party, such other address as shall have been
notified in writing to the other of them for the purposes of service hereunder.
Executive agrees to notify the Company, in writing, of any change in
address after this Agreement is executed.
WITNESS the following signatures as of the indicated dates.
AMERICAN NATIONAL BANK AND TRUST COMPANY
July 31, 1999 /s/Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
President & Chief Executive Officer
July 31, 1999 /s/ Xxxxx X. Xxxxxxx, Xx.
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Xxxxx X. Xxxxxxx, Xx.
