AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT
This AMENDMENT No. 2 TO EMPLOYMENT AGREEMENT ("Second Amendment") is
made as of the 20th day of December, 1996 between Mercantile National Bank (the
"Bank"), a national banking association organized and existing under the laws of
the United States, and Xxxxx X. Xxxxxxxxxx, an individual ("Xxxxxxxxxx") and
amends that certain Employment Agreement dated June 21, 1996 between the Bank
and Xxxxxxxxxx as amended by that certain Addendum dated June 21, 1996
(collectively, the "Employment Agreement").
RECITAL
WHEREAS, the Bank and Xxxxxxxxxx desire to amend the Employment
Agreement to reflect the following terms and conditions.
NOW, THEREFORE, Bank and Xxxxxxxxxx hereby agree as follows:
1. Section 3.4 of the Agreement shall be deleted in its entirety and
replaced with the following:
Bancorp has granted to Xxxxxxxxxx options to purchase 200,000
shares of Bancorp common stock (the "Stock Options") under the
National Mercantile Bancorp 1990 Stock Option Plan (the "1990
Plan") on December 20, 1996. The terms and conditions of such
Stock Options shall be set forth in a separate option agreement.
Such Granted Stock Options shall be deemed incentive options to
the maximum extent permitted by law and the 1990 Plan. Such
stock option agreement, which must be executed by Xxxxxxxxxx and
Bancorp, shall include, among others, the following terms and
conditions:
2. The term "Non-Qualified Stock Options" used in subsection 3.4.2,
3.4.3, 3.4.4 and 3.4.5, shall be deleted and replaced with the term
"Granted Stock Options" and the word "Non-Qualified" used in
subsections 3.4.6 and 3.4.7 shall be deleted and replaced with the
term "Granted."
3. The first phrase of the second sentence of Section 3.4.4 shall be
deleted in its entirety and replaced with the following:
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Bancorp shall adopt the 1996 Stock Incentive Plan to
authorize 500,000 (pre Reverse Stock Split shares contemplated by
the Board of Directors to occur in connection with the
Recapitalization) additional shares (the "1996 Plan") and submit
the 1996 Plan for approval at the next annual or special
shareholders meeting. Bancorp's Board of Directors shall
recommend and solicit approval of the 1996 Plan. Subject to such
approval,
4. Subsection 3.4.4(g) shall be amended by adding the following:
(i) For purposes of this Agreement, any adjustments
contemplated by Section 3.4.4 hereof to occur after a
Recapitalization shall be required to occur only once and with
respect only to the first such Recapitalization to occur on or
before December 31, 1999.
5. Subsection 3.4.4(h) is deleted in its entirety and replaced with
the following:
(h) Xxxxxxxxxx acknowledges that at present there are not
sufficient shares available under the National Mercantile Bancorp
1990 or 1994 Stock Option Plans (collectively, the "Plans") to
xxxxx Xxxxxxxxxx the Additional Options (or the Option and Tandem
SAR referred to in paragraph 3.5), and that shareholder approval
for the 1996 Plan providing for additional shares is required.
Bancorp agrees to adopt the 1996 Plan and to submit the 1996 Plan
to the shareholders of Bancorp for approval at the next annual
or special shareholders meeting. Bancorp's Board of Directors
shall recommend and solicit approval of the 1996 Plan.
6. Subsection 3.4.5 shall be amended by adding the words "or the
1996 Plan, as the case may be" immediately before the period.
7. A new sentence shall be added to the end of subsection 3.4.6 as
follows:
In no event shall Xxxxxxxxxx be permitted to exercise any options
granted by the Company to him, and, as a result hereof, hold more
than 4.9% of the Company's capital stock at any time during the
period commencing on the date
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hereof and continuing for a period of three years following the
Recapitalization.
8. Section 3.5 shall be amended by deleting the first sentence and
replacing it with the following:
Pursuant to a separate stock rights agreement, and subject to
shareholder approval of the 1996 Plan, Bancorp shall grant to
Xxxxxxxxxx a non-qualified stock option ("Option") and tandem
stock appreciation right ("Tandem SAR") with respect of 75,000
shares of Bancorp Common Stock (the "Option and Tandem SAR")
under the 1996 Plan.
9. Subsections 3.4.4(e) and 3.5.5 shall be amended by deleting all
references to the 1990 Plan and replacing such references with "1996
Plan".
10. Subsection 3.5.6 shall be deleted in its entirety and replaced
with the following:
3.5.6 Xxxxxxxxxx acknowledges that at present there are not
sufficient shares available under the Plans to xxxxx Xxxxxxxxxx
the Option and Tandem SAR (or the Additional Options referred to
in paragraph 3.4.4), and that shareholder approval for the 1996
Plan providing for additional shares is required. Bancorp agrees
to adopt the 1996 Plan and to submit the amendment to the
shareholders of Bancorp for approval at the next annual or
special shareholders meeting. Bancorp's Board of Directors shall
recommend and solicit approval of the 1996 Plan.
11. Subsection 3.5.7 shall be amended by deleting the words "the 1990
Plan" and adding the words "the 1996 Plan."
12. Xxxxxxxxxx acknowledges that on December 20, 1996 the Stock
Option Committee of the Board of Directors cancelled the grant of
options of 200,000 shares of Common Stock to Xxxxxxxxxx on June 21,
1996 and granted Xxxxxxxxxx options of 200,000 shares of Common Stock
at $1.25 per share.
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13. All other terms and conditions contained in the Employment
Agreement shall remain in full force and effect.
MERCANTILE NATIONAL BANK
By /s/ XXXXXX X. XXXX
-------------------------------------
Xxxxxx X. Xxxx
Chairman
By /s/ XXXXX X. XXXXXXXXXX
-------------------------------------
Xxxxx X. Xxxxxxxxxx
Agreed as to the obligations of National Mercantile Bancorp specified in the
foregoing Agreement.
NATIONAL MERCANTILE BANCORP
By /s/ XXXXXX X. XXXX
-------------------------------------
Xxxxxx X. Xxxx
Chairman, President & CEO
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14. INTERPRETATION AND CONSTRUCTION. The interpretation and
construction of this Agreement b the Committee shall be final, binding
and conclusive. The section headings in this Agreement are for
conveniences of reference only and shall not be deemed part of, or
germane to the interpretation or construction of, this Agreement.
NATIONAL MERCANTILE BANCORP
By /s/ XXXXXX X. XXXX
-------------------------------------
Xxxxxx X. Xxxx
Chairman of the Board
By /s/ XXXXX X. XXXXXXXXXX
-------------------------------------
Xxxxx X. Xxxxxxxxxx
Optionee
By her signature below, the spouse of the Optionee agrees to be bound by all of
the terms and conditions of the foregoing Agreement.
By /s/ XXXXXX XXXX XXXXXXXXXX
-------------------------------------
Xxxxxx Xxxx Xxxxxxxxxx
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