EXHIBIT 10.2
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of January 1, 1998,
by and between CENTURY NATIONAL BANK AND TRUST, a national banking association
("Century"), CITIZENS BANKING COMPANY, an Ohio corporation ("Citizens")
(collectively referred to as the "Company"), and XXXXXX X. XXXXXXXX (the
"Employee").
WHEREAS, the Company desires to procure the services of Employee, and
Employee is willing to be employed by the Company, upon the terms and subject to
the conditions herein.
NOW, THEREFORE, intending to be legally bound, the Company agrees to employ
Employee, and Employee hereby agrees to be employed by the Company, upon the
following terms and conditions:
1. Employment and Duties.
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(a) Century agrees to employ and Employee agrees to be employed
by Century as Century's Senior Vice President and Chief Financial Officer. Upon
such time when Century becomes a division of Citizens, Citizens agrees to employ
and Employee agrees to be employed by Citizens as an officer. Employee shall
report directly to the Chief Executive Officer of Citizens, or his designee
("Citizens Representative") and shall have such responsibilities as may from
time to time be prescribed by the Citizens Representative. Employee agrees to
perform such duties as may be assigned, to devote all of his working time to the
business of the Company, and to use his best efforts to advance the interests of
the Company and its shareholders. If the Employee is elected a director of the
Company during the Term of this Agreement, Employee shall serve in that capacity
without any additional compensation from the Company.
(b) Employee represents and warrants to the Company that he
is free to be employed by the Company, and that he has no prior or other
obligations or commitments of any kind to anyone that would in any way hinder or
interfere with Employee's full and faithful performance of his duties under this
Agreement.
(c) Nothwithstanding anything to the contrary herein or
otherwise, nothing in this Agreement shall prohibit Employee from serving as a
director or officer of any trade association, civic, educational or charitable
or governmental entity so long as it does not substantially interfere with the
performance of his duties as provided in paragraph (a) hereof.
2. Term. The Company hereby employs Employee for a period of
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three (3) years beginning on the date of this Agreement and expiring on January
1, 2001 unless terminated earlier in accordance with the provisions of Section 6
of this Agreement. Notwithstanding the foregoing, Employee's obligations and the
Company's rights under Section 7 hereof and under the Confidentiality,
Noncompetition and Nonsolicitation Covenants (as hereinafter defined) shall
survive the termination of this Agreement.
3. Compensation.
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(a) During the term of this Agreement the Company shall pay
to Employee an annual salary of Ninety-Seven Thousand Eight Hundred Forty-Nine
Dollars and Eleven Cents ($97849.11). The annual salary of Employee in effect
from time to time is hereafter referred to as the "Base Salary." The Base Salary
shall be payable in accordance with the Company's normal payroll practices for
employees (but no less frequently than monthly), and the Company shall deduct of
cause to be deducted from the base salary all taxes and amounts required by law
to be withheld. The Base Salary may be increased (but not decreased) at any time
and from time to time by action of the Company's Board of Directors.
(b) Nothing herein shall be deemed to preclude the Company
from paying Employee, in addition to his Base Salary, any bonuses as may be
awarded from time to time as provided in Section 4 herein.
(c) The Company will reimburse Employee for all reasonable
business expenses incurred by Employee in the course of performing Employee's
duties under this Agreement that are consistent with the Company's policies in
effect from time to time with respect to travel, entertainment and other
business expenses.
4. Bonus. During the term of this Agreement the Company shall pay
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to the Employee a bonus of up to 25% of Base Salary based upon reasonable
individual and corporate performance as determined by the Company's Board of
Directors (the "Bonus").
5. Benefits. During the term of this agreement, Employee and
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Employee's eligible dependents shall be entitled to participate in employee
benefit plans generally afforded by the Company to its employees from time to
time provided that such participation complies with applicable federal and state
law. Notwithstanding the foregoing, the Company shall pay the lease, insurance,
gas and maintenance expenses for the Employee's current car until the earlier of
the date that said lease expires or December 31, 1998 (the "Lease Period"). At
the end of the Lease Period, the Company shall pay the Employee a monthly car
allowance to cover the Employee's lease, insurance, gas and maintenance expenses
provided that such allowance is substantially similar to the monthly payments
made during the Lease Period.
6. Disability or Death; Resignation; Termination for Cause; Other
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Terminations.
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(a) Death. In the event of Employee's death, this Agreement
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and Employee's employment shall terminate upon such date of death, except that
Employee's designated beneficiary (or, in the absence of a designated
beneficiary, Employee's estate) shall be entitled to receive the unpaid portion
of Employee's Base Salary and Bonus earned up to the date of his death; and
Employee's designated beneficiary (or, in the absence of a designated
beneficiary, Employee's estate) shall be entitled to receive all benefits
payable as a result of Employee's death under the terms of the Company's
employee benefit plans.
(b) Disability. If Employee is incapacitated for a period
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of one hundred eighty (180) consecutive days so that Employee cannot
substantially perform his duties hereunder
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on a full-time basis (a "Disability"), Employee's employment will terminate upon
the expiration of such 180 day period. Notwithstanding the foregoing, Employee's
obligations and the Company's rights under Section 7 hereof and under the
Confidentiality, Noncompetition and Nonsolicitation Covenants (as hereafter
defined) shall survive the termination of this Agreement, and Employee shall be
entitled to receive (i) the unpaid portion of Employee's Base Salary and Bonus
earned up to the date of such termination reduced by the amount of any payments
received by Employee pursuant to any short-term disability plan or other plan
providing disability payments to the Employee, and (ii) all benefits payable to
Employee as a result of such termination under the Company's employee benefit
plans.
(c) Termination for Cause. The Company may terminate
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Employee's employment at any time for cause (as defined below). If the Company
terminates Employee's employment for cause (as defined below), all of the
Company's obligations hereunder shall immediately terminate. As used in this
section, "for cause" shall mean (i) gross misconduct by Employee, or (ii)
Employee's commission of a felony or an act of moral turpitude, or (iii)
Employee's material breach or failure to perform any provision of this
Agreement, but only if Employee is first given written notice from the Citizens
Representative specifying the nature of such breach or failure and Employee
refused to remedy such breach or failure within a period of thirty (30) days
after receipt of such notice. Employee shall be entitled to receive the unpaid
portion of Employee's Base Salary earned up to the date of such termination.
(d) Termination Without Cause by the Employee.
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(1) Employee may terminate his employment at any
time without cause pursuant to written notice at least thirty (30) days in
advance of the termination of employment date specified by him (the "Termination
Notice").
(2) If Employee's employment terminates pursuant to
this Section 6(d), both the Company's and Employee's obligations hereunder shall
terminate as of the termination date specified in the Termination Notice.
Employee shall be entitled to receive the unpaid portion of Employee's Base
Salary, Bonus and benefits payable to Employee as a result of such termination
under the Company's employee benefit plans earned up to the date of such
termination.
(e) Termination Without Cause by the Company.
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(1) The Company may terminate Employee's employment
at any time without cause pursuant to written notice at least thirty (30) days
in advance of the termination of employment date specified by the Company (the
"Termination Notice").
(2) If Employee's employment terminates pursuant to
this Section 6(e), both the Company's and Employee's obligations hereunder shall
terminate as of the termination date specified by the Termination Notice.
Employee shall be entitled to receive the unpaid portion of Employee's Base
Salary, Bonus and benefits payable to Employee as a result of such termination
under the Company's employee benefit plans earned up to the date of such
termination. Notwithstanding the foregoing (i) Company's obligations under
Sections 3, 4 and
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5 hereof shall survive the termination of this Agreement and (ii) Employee's
obligations and the Company's rights under Section 7 hereof and under the
Confidentiality, Noncompetition and Nonsolicitation Covenants (as hereafter
defined) shall survive the termination of this Agreement unless Employee waives
his rights in writing to receive payments under Sections 3, 4 and 5 hereof.
(f) Change in Control. If there occurs a "change in control"
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(as hereinafter defined) of Citizens or Citizens Bancshares, Inc.
("Bancshares"), then in any such event the Employee shall have the right to
terminate this Agreement and such termination shall be considered a termination
without cause by the Company under Section 6(e) herein. The Term "change in
control" shall mean the following events:
(1) When any "person" as defined in Section 3(a)(9)
of the Exchange Act and as used in Sections 13(d) and 14(d) thereof, including a
"group" as defined in Section 13(d) of the Exchange Act, but excluding Citizens
or Bancshares and any employee benefit plan sponsored or maintained by Citizens
or Bancshares (including any trustee of such plan acting as trustee), directly
or indirectly, becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act, as amended from time to time), of securities of Citizens or
Bancshares representing more than fifty percent (50%) of the combined voting
power of Citizens' or Bancshares' then outstanding securities; or
(2) The completion of a transaction requiring
shareholder approval for the acquisition of substantially all of the stock or
assets of Citizens or Bancshares by an entity other than Citizens or Bancshares
or any merger of Citizens or Bancshares into another company and Citizens or
Bancshares is not the surviving entity.
7. Confidentiality, Noncompetition and Nonsolicitation. The
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confidentiality, noncompetition and nonsolicitation covenants attached hereto as
Exhibit A (the "Confidentiality, Noncompetition and Nonsolicitation Covenants")
are hereby incorporated by reference and made a part of this Agreement.
8. Change in Control. Upon the expiration of the term of this
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Agreement, provided that Employee is still employed by Citizens, Citizens agrees
to enter a change in control agreement substantially in the Form of Section 6(f)
herein for a period of one year, renewable on an annual basis at the election of
Citizens.
9. Enforceability. The unenforceability or invalidity of any
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provision of this Agreement shall not affect the enforceability or validity of
the balance of this Agreement. In the event that any such provision should be
or becomes invalid for any reason, such provision shall remain effective to the
maximum extent permissible, and the parties shall consult and agree on a legally
acceptable modification giving effect to the commercial objectives of the
unenforceable or invalid provision, and every other provision of this agreement
shall remain in full force and effect.
10. Assignment; Binding Effect. This Agreement, being for the
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personal services of Employee, shall not be assignable by Employee. Subject to
the foregoing, this Agreement shall inure to the benefit of, and be enforceable
by, the parties' successors, representatives, executors, administrators or
assignees.
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11. Notices. All notices, requests, demands and other
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communications made or given in connection with this Agreement shall be in
writing and shall be deemed to have been duly given (a) if delivered, at the
time delivered against receipt or (b) if mailed three (3) days after mailing at
any general or branch United States Post Office enclosed in a registered or
certified postage paid envelope, or (c) if couriered, one day after deposit with
a national overnight courier, addressed to the address of the respective parties
as follows:
To the Company: Century National Bank and Trust
Citizens Banking Company
00 Xxxx Xxxx Xx.
X.X. Xxx 000
Xxxxxxxxxxx, XX 00000
To Employee: ----------------------------------------------
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or to such other addresses as the party to whom notice is to be given may have
previously furnished to the other party in writing in the manner set forth
above, provided that notices of changes of address shall only be effective upon
receipt.
12. Entire Agreement. This Agreement constitutes the entire
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agreement of the parties hereto relating to the subject matter hereof, and there
are no written or oral terms or representations made by either party other than
those contained herein.
13. Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of Ohio, without regard to
principles of conflicts of laws. The Company and the Employee hereby
irrevocably submit to the jurisdiction of the courts of the state of Ohio,
with venue in Columbiana County, over any dispute arising out of this Agreement
and agree that all claims in respect of such dispute or proceeding shall be
heard and determined in such court. The Company and Employee hereby
irrevocably waive, to the fullest extent permitted by law, any objection which
they may have to the venue of any such dispute brought in such court or any
defense of inconvenient forum for the maintenance of such dispute. The Company
and Employee hereby consent to the process of being served by them in any suit,
action or proceeding by delivering it in the manner specified by the provisions
of Section 11 of this Agreement.
14. Set-Off. Any and all payment obligations of the Company to
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Employee under this Agreement shall be subject to the Company's right to set off
amounts owed to it by Employee, whether under this Agreement or otherwise.
15. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which so executed and delivered shall constitute an
original hereof, and it shall not be necessary in making proof of this Agreement
to produce or account for more than one original counterpart hereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written but on the dates indicated below.
EMPLOYEE CENTURY NATIONAL BANK AND TRUST
------------------------------------ By: ----------------------------
Xxxxxx X. Xxxxxxxx
Its: ----------------------------
CITIZENS BANKING COMPANY
By: ----------------------------
Its: ----------------------------
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EXHIBIT A
TO
EMPLOYMENT AGREEMENT
Confidentiality, Noncompetition
and Nonsolicitation Covenants
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1. Noncompetition. Employee agrees that during the term of
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Employee's employment by the Company and for so long as Employee is either
receiving payments pursuant to Section 6(b) or 6(e) hereof or is incapacitated
as a result of a Disability, Employee shall not, without the prior written
consent of the Company, either directly of indirectly, engage in, make any
investment in or have any interest in any business in competition with the
business of the Company located within twenty (20) miles of Bancshares' or its
subsidiaries' places of business; and the Employee shall not advise, assist or
render services either directly or indirectly to any person, firm, company,
corporation or business other than the Company with reference to any business in
competition with the business engaged in by the Company during the Employee's
employment with the Company. Notwithstanding the foregoing, the ownership of
securities of any business competing with the Company, is such securities are
publicly traded on a national securities market and constitute less than five
percent (5%) of the outstanding stock thereof shall not constitute a violation
of this provision.
2. Nonsolicitation. Employee agrees that Employee shall not at any
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time (whether during or after Employee's termination of employment with the
Company), without the prior written consent of the Company, either directly or
indirectly (i) solicit (or attempt to solicit) induce, (or attempt to induce),
cause or facilitate any employee, director, agent, consultant, independent
contractor, representative or associate of the Company to terminate his, her or
its relationship with the Company, or (ii) solicit (or attempt to solicit)
induce (or attempt to induce), cause or facilitate any supplier of services or
products to the Company to terminate or change his, her or its relationship with
the Company, or otherwise interfere with any relationship between the Company
and any of the Company's suppliers of products or services.
3. Nondisclosure. Employee agrees that Employee shall not at any
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time (whether during or after the period of Employee's employment with the
Company) directly or indirectly divulge, disclose or communicate to any person,
firm, company, corporation or business in any manner whatsoever any confidential
information relating to the business of the Company, including without
limitation, the Company's business plans, strategies, pricing, sales methods,
trade secrets, know-how and similar types of information.
4. Inventions and Patents. Employee agrees that all inventions,
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innovations, improvements, developments, methods, designs, analyses, drawings,
reports, and all similar or related information which relates to the Company's
actual or anticipated business, research and development or existing or future
products or services and which are conceived, developed or made by Employee
while employed by the Company or its predecessor (all of the foregoing being
referred to herein as "Work Product") belong to the Company. Employee shall
perform all actions reasonably requested by the Company (whether during or after
the Employment Term)
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