EXHIBIT 10.1 Consultant Agreement with X. X. Xxxxx
Consulting Agreement
This Consulting Agreement ("Agreement") is entered into this 1st day of
July 1999 ("Effective Date") by and between Southwest Virginia Savings Bank,
FSB, a federal savings bank (the "Company") with its place of business
headquartered at Roanoke, Virginia and X. X. Xxxxx ("Consultant").
WHEREAS, the Company recognize the specialized knowledge and expertise
of the Consultant related to the business affairs of the industry and the
Company, and that upon retirement of the Consultant as the President and Chief
Executive Officer, the Company wishes to enter into a consulting relationship
with Consultant; and
WHEREAS, Consultant has previously served the Company and its parent
corporation, SWVA Bancshares, Inc. ("Parent") as President and Chief Executive
Office;
WHEREAS, Consultant and the Company desire to enter into such a
consulting relationship upon the terms and conditions hereinafter contained;
NOW, THEREFORE, in consideration of the covenants and terms contained
in this Agreement as set forth herein and of the mutual benefits accruing to
Company and to Consultant from the consulting relationship to be established
between the parties by the terms of this Agreement, Company and Consultant agree
as follows:
1. Consulting Relationship
Company hereby retains Consultant, and Consultant hereby agrees to be
retained by Company, as an independent contractor, and not as an employee. The
Consultant hereby acknowledges that he has resigned as an employee of the
Company and the Parent on or before the Effective Date.
2. Consulting Service
Consultant agrees that during the term of this Agreement:
A. Consultant will devote his best efforts to his position as an
independent contractor and will perform such duties and
execute the policies of Company as determined by its board of
directors and its President as the Company and Consultant may
mutually agree upon from time to time; provided that said
duties performed by Consultant shall not be inconsistent with
the nature and character of the duties
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performed by Consultant for the Company when serving as the
President and Chief Executive Officer. As an independent
contractor, Consultant shall not be an officer or employee of
the Company and shall not be subject to the direct control or
supervision of the Company or its President with respect to
the time spent, research undertaken, or procedures followed in
the performance of consulting services rendered hereunder.
During the Term of the Agreement, Consultant agrees to consult
with the Company on matters related to the business affairs
and operations of the Company, including matters that relate
to compliance with applicable banking laws and regulations and
merger and acquisition planning. It is estimated that such
activities will encompass approximately 8 to 10 business days
per month.
B. Consultant shall exercise a reasonable degree of skill,
prudence and care in performing the services referred to in
Paragraph A above;
C. Except as may be limited by Section 6 hereinafter, Consultant
may be an employee, officer or director of other companies or
entities and may provide consulting services for other
companies or organizations; provided that such activities do
not conflict with the services and activity that the
Consultant is actually rendering to the Company or any of its
subsidiaries or the services or activities of the Company and
its subsidiaries;
D. Consultant shall be available to render services to Company
under this Agreement as requested by the Board of Directors or
the President of the Company commencing on the first date of
the initial Term of this Agreement as contained in Section 5
herein. Consultant shall not be obligated to render any
services under this Agreement during such period when he is
unable to do so due to illness, disability or injury, subject
to the terms of Section 5(b) hereof;
E. Consultant shall be available for service hereunder upon
receipt of no less than (5) five days' written notice from
Company; and
F. Consultant shall not enter into agreements or make commitments
on behalf of the Company without prior written consent or
approval of the Company or its President.
3. Compensation
A. Company agrees to pay Consultant for his services performed
under this Agreement and for his commitments and agreements as
contained herein, including Section 6 herein, at the rate of
$40,000 per year payable no less than monthly at the rate of
$3,333 per month throughout the Term of the Agreement.
Consultant shall not be entitled to participate in or receive
benefits under any Company
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programs maintained for its employees, except as specifically
agreed to by the parties. During the Term of the Agreement,
the Company will also reimburse the Consultant for the monthly
premium expense related to Consultant maintaining Medicare
Supplement Insurance (medi-gap).
B. Other Compensation. In the event that Consultant serves as a member
of the Board of Directors of the Company, its parent or any of its subsidiaries,
Consultant shall be paid the fee normally paid for such service to other
non-employee directors and any fees as Chairman of the Board of the Company or
the Parent without regard to any other compensation paid under this Agreement.
4. Other Conditions
Consultant shall have no authority over any employee or
officer of Company, except as may be necessary in the routine
performance of his duties hereunder, nor shall Company be required in
any manner to implement any plans or suggestions Consultant may
provide.
5. Term and Termination
The term of this Agreement shall begin on the Effective Date
and shall continue for a period of one year thereafter ("Term"), unless
extended or terminated in accordance with the provisions set forth
below.
(a) Termination for Cause. The Company may terminate
this Agreement at any time for "Just Cause." Termination for
"Just Cause" shall be defined as termination because of the
Consultant's personal dishonesty, willful misconduct, breach
of fiduciary duty involving personal profit, or willful
violation of any law, rule or regulation related to the
business or operations of the Company or its subsidiaries.
(b) Death or Disability. In the event of Consultant's
death or permanent disability as determined by the President
of the Company, this Agreement shall terminate and all rights
to receive payments under the remaining term of the Agreement
shall cease.
6. Non-Competition and Confidential Business
Consultant, during the term of the Agreement, will not,
without the express written consent of Company, directly or indirectly
communicate or divulge to, or use for his own benefit or for the
benefit of any other person, firm, association, or corporation, any of
the Company's, or its subsidiaries' or affiliates', trade secrets,
proprietary data or other confidential information communicated to or
otherwise learned or acquired by Consultant
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from the Company during the Term of this Agreement, except that
Consultant may disclose such matters to the extent that disclosure is
required (a) in the course of the consulting relationship with Company
or (b) by a court or other governmental agency of competent
jurisdiction.
During the term of this Agreement, Consultant will not contact
(with a view toward selling any product or service competitive with any
product or service sold or proposed to be sold by Company or any
subsidiary or affiliate of Company) any person, firm, association or
corporation (a) to which Parent or Company or any subsidiary or
affiliate of Parent sold any product or service, (b) which Consultant
solicited, contacted or otherwise dealt with on behalf of Parent or
Company or any subsidiary or affiliate of Parent, or (c) which
Consultant was otherwise aware was a client of Parent, Company or its
parent or subsidiary or affiliate of Parent. During such period,
Consultant will not directly or indirectly make any such contact,
either for his own benefit or for the benefit of any other person,
firm, association, or corporation.
During the term of this Agreement, Consultant will not serve
as an employee, officer, consultant, director or in any other advisory
capacity, whether compensated or uncompensated, for any financial
services organization, corporation or entity (including but not limited
to an insured depository institution within the meaning of the Federal
Deposit Insurance Act, a federal or state chartered credit union, an
insurance company, a mortgage brokerage or mortgage banking firm, an
investment advisory or investment brokerage firm, or other financial
services entity with offices in Virginia.
7. Independent Contractor
The parties hereto agree and acknowledge that the relationship
between Company and Consultant shall be that of an independent
contractor and not that of employer-employee, master-servant or
principal-agent. Nothing in this Agreement, or its implementation,
shall be construed to be to the contrary.
8. The Complete Agreement
This Agreement, and any attachments or exhibits appended
hereto, shall represent the complete Agreement between Company and
Consultant concerning the subject matter hereof and supersedes all
prior agreements or understandings, written or oral. No attempted
modification or waiver of any of the provisions hereof shall be binding
on either party unless made in writing and signed by both Consultant
and Company.
9. Notices
Any notice required or permitted to be given hereunder shall
be in writing and shall be effective three business days after it is
properly sent by registered or certified mail, if
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to the Company to the President at the administrative offices of the
Company, or if to Consultant to the address set forth beneath his
signature to this Agreement, or to such other address as either party
may from time to time designate by notice.
10. Assignability
This Agreement may not be assigned by either party without the
prior written consent of the other party, except that no consent is
necessary for the Company to assign this Agreement to a corporation
succeeding to substantially all the assets or business of the Company
whether by merger, consolidation, acquisition or otherwise. This
Agreement shall be binding upon Consultant, his heirs and permitted
assigns and the Company, its successors and permitted assigns.
11. Severability
Each of the sections contained in this Agreement shall be
enforceable independently of every other section in this Agreement, and
the invalidity or nonenforceability of any section shall not invalidate
or render nonenforceable any other section contained herein. If any
section or provision in a section is found invalid or unenforceable, it
is the intent of the parties that a court of competent jurisdiction
shall reform the section or provisions to produce its nearest
enforceable economic equivalent.
12. Arbitration
Unless otherwise mutually agreed to by the Consultant and the
Company in writing, any controversy or claim arising out of or relating
to this Agreement or the breach thereof shall be settled by binding
arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association, with such arbitration hearing to be
held at the offices of the American Arbitration Association ("AAA") at
the AAA office nearest to the home office of the Company, and judgment
upon the award rendered by the arbitrator(s) may be entered in any
court having jurisdiction thereof. Either the Consultant or the Company
may file a request for such arbitration with the AAA.
13. Applicable Law
It is the intention of the parties hereto that all questions
and interpretations with respect to the construction and performance of
this Agreement and the rights and liabilities of the parties hereto
shall be determined in accordance with the laws of the Commonwealth of
Virginia, with respect to an matter or thing arising out of this
Agreement or pursuant thereto.
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