EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into this 30th day of November 1998, by and
between, BankPhiladelphia, (hereinafter referred to as "Bank"), and Xxxxx X.
Xxxxx (hereinafter referred to as "Executive") for the position and title of
Senior Vice President
Director of Lending/Credit
W I T N E S S E T H :
WHEREAS, Bank wishes to assure itself of the services of Executive for the
period provided in this Agreement, and Executive is willing to serve in Bank's
employ on a full time basis for said period;
WHEREAS, the Board of Directors of the Bank have determined that the best
interests of Bank would be served by providing the Executive with protection and
special benefits provided for herein;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereby agree as follows:
Section I. Employment
A. Duties of Employment. Bank agrees to employ Executive, and Executive
agrees to remain in the employ of Bank for the period stated in paragraph B
hereof and upon the other terms and conditions herein provided. Bank employs
Executive and Executive agrees to serve as a member of senior management of Bank
for the term and on the conditions hereinafter set forth, with the title Vice
President, Director of Operations of the Bank, and with the responsibilities
related therewith as shall be further setforth by the Chief Operating Officer
and the President & CEO of the Bank. Executive agrees to perform such services
not inconsistent with his position as shall from time to time be assigned to
him.
B. Term of Employment. The duties and obligations of the Executive and Bank
under this Agreement shall commence as of the date of this Agreement, and shall
continue for a period of three (3) years (said three (3) year period being
hereinafter referred to as the "Term of Employment"). This Agreement shall
automatically renew annually for an additional three year period unless written
notice is given by either Executive or Bank 60 days prior to expiration hereof.
Section II. Compensation
A. Salary. Bank agrees to pay the Executive during the Term of Employment
an annual base salary equal to One Hundred Twenty Thousand Dollars ($120,000.00)
(hereinafter referred to as "Salary"). Such Salary shall be payable on a
biweekly basis as concomitant with all employees of the Bank.
B. Incentive Compensation. Bank shall pay Executive incentive compensation
as follows:
1.) Earnings per share: $50,000 shall be paid to executive in the
event that USABancShares earns in excess of $1.00 per share in any
four consecutive reporting periods subsequent to the date hereof,
and during which time Executive remains as an employee of the Bank
or Holding Company.
2.) A $60,000 bonus will be payable when the loan assets and
non-performing assets reach $200,000,000 and 1.85%, respectively.
C. Bonus. Bank will further consider payment to the Executive of an annual
bonus (hereinafter referred to as "Bonus"). Such Bonus shall be entirely
discretionary and may or may not be granted if so determined by the President &
CEO of the Bank.
Section III. Duty of Loyalty and Attention
A. Executive shall devote his full-time and best effort to the performance
of his employment under this Agreement and shall perform his duties under this
Agreement in accordance with such reasonable standards expected of employees of
comparable positions in comparable organizations and as may be established from
time to time by Bank's Board of Directors or the President & CEO of the Bank.
B. During the Executive's Term of Employment, the Executive shall not, at
any time or place, either directly or indirectly engage in any business or
activity in competition with the business affairs or interests of BANK.
Section V. Executive Benefits
A. Executive will be entitled to receive benefits under any present or
future group hospitalization, retirement, health, dental care, vacation or sick
leave plan, life or other insurance, as made available to other members of Bank.
B. Executive shall be reimbursed for reasonable business-related expenses
on a monthly basis and have available to him a parking space.
Section VI. Termination and Termination Pay
A. Event of Termination. Upon the occurrence of an Event of Termination (as
hereinafter defined) during the period of Executive's employment under this
Agreement, the provisions of this paragraph A shall apply. As used in this
Agreement, an "Event of Termination" shall mean the termination by Bank of
Executive's employment hereunder for any reason other than because of
retirement. A termination for "cause" shall include termination because of the
Executive's personal dishonesty, misconduct, breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties, violation of any
law, rule or regulation (other than traffic violations or similar offenses) or
final cease-and-desist order, or material breach of any provision of this
Agreement. In the event of termination for cause the Executive shall have no
right to receive further compensation, Salary, or Bonus of any kind, or other
benefits for any period after such termination.
B. Event of Termination Without Cause. Upon the occurrence of an Event of
Termination other than for "Cause" as hereinabove defined, BANK shall pay the
Executive on a biweekly basis, while living, during the lessor period of
obtaining employment or the Employment Agreement, the Executive's current
salary, medical benefits and the use of a company automobile. BANK shall also
pay any earned bonuses, as well as any expense reimbursements due to the
Executive. Payments shall commence on the pay cycle immediately following said
occurrence, which said occurrence shall be viewed as a determination by BANK not
to extend the agreement beyond the Term of Employment as set forth in section I,
paragraph B. Executive must be provided written notice at least 60 days prior to
termination as set forth herein.
C. In the event of a Change in Control, as described in the USABancShares,
Inc. Stock Option Plan, the Executive shall be entitled to his current salary,
medical benefits and the use a of a company automobile for the period of time
equal to twenty-four (24) months, if he is not offered continued employment with
the same job title, responsibilities, locality and compensation, noted herein.
D. Event of Executive Terminating Employment. If the Executive terminates
employment or does not renew the Employment Agreement the Executive is entitled
to all earned compensation (salary and bonuses), and all expense reimbursements
due to the Executive through his last day of employment with BANK.
E. Power of President & CEO to Terminate Executive. The President & CEO of
BANK may terminate the Executive at any time; in the event of such termination
the provisions of Section VI, Paragraphs A and B shall apply.
F. Suspension of Employment. If the Executive is suspended and/or
temporarily prohibited from participating in the conduct of Bank's affairs by a
notice served under applicable regulatory guidelines, Bank's obligations under
the Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, Bank shall:
(i) pay the Executive all of the compensation withheld while its contract
obligations were suspended; and (ii) reinstate its obligations which were
suspended.
Section VII. Proprietary Information
A. Fiduciary Obligations. In the course of service to BANK, the Executive
may have access to confidential information (hereinafter referred to a
"Proprietary Information"). Proprietary Information shall include all
information which gives BANK a competitive advantage, including without
limitation, know-how, strategic or technical data, processes, business or
financial documents or information, sales and marketing data, marketing research
data, all customer and prospective customer lists, customer account records,
personnel records, placement information, all financial information of the
Association and its customers, and sources of supply and trade secrets, all of
which are confidential and proprietary, owned or used by any of the above
companies. Proprietary Information shall also include any and all items
constituting a "trade secret" whether or not enumerated in the preceding
sentence, and coming within the scope of BANK business as to which the Executive
may have access. Proprietary Information shall not include any records, data, or
information which are in the public domain during the term of this Agreement,
provided the same are not in the public domain as a consequence of disclosure
directly or indirectly by the Executive in violation of this Agreement. The
Executive acknowledges and agrees that Proprietary Information is of critical
importance to BANK, and a violation of this Agreement would seriously and
irreparably impair and damage BANK's business. The Executive shall keep all
Proprietary Information in a fiduciary capacity for the sole and exclusive
benefit of BANK.
B. Non-disclosure. The Executive shall not, during the term of this
Agreement, or for a period of two (2) years thereafter, use for his own benefit,
or disclose, directly or indirectly, any Proprietary Information to any person
other than BANK or authorized employees thereof at the time of such disclosure,
or such other persons to whom the Executive has been specifically instructed to
make disclosure by the Board, and in all such cases only to the extent required
in the course of the Executive's service to BANK. At the termination of the
Executive's employment, the Executive shall deliver to Bank all notes, letters,
documents, and records which may contain Proprietary Information which are then
in his possession or control an shall not retain or use any copies or summaries
thereof.
C. Survival of Covenants. The covenants of the Executive in this Section
shall survive the termination or expiration of this Agreement hereunder and
shall expire two (2) years from the date of termination or expiration of this
Agreement.
Section VIII. Successors and Assigns
A. Successor in Interest. This Agreement shall inure to the benefit of and
be binding upon any corporate or other successor of USABancShares, Inc and Bank
which shall acquire, directly or indirectly, by merger, consolidation, purchase,
or otherwise, all or substantially all of the assets of USABancShares, Inc or
Bank.
B. Prohibition of Assignment. Since Bank is contracting for the unique and
personal skills of the Executive, the Executive shall be precluded from
assigning or delegating his rights or duties as Executive Vice President and
Director of Lending/Credit hereunder without first obtaining written consent of
Bank.
Section IX. Amendments / Applicable Law
A. No amendments or additions to this Agreement shall be binding unless in
writing and signed by both parties, except as herein otherwise provided.
B. This Agreement shall be governed by all respects whether as to validity,
construction, capacity, performance, or otherwise, by the laws of the
Commonwealth of Pennsylvania, except to the extent that federal law shall be
deemed to apply.
Section X. Severability
A. In the event any one or more of the provisions contained in this
Agreement shall, for any reason, be held to be invalid, illegal, or
unenforceable in any respect, the invalidity, illegality, or unenforceability
shall not affect any other provision, and this Agreement shall be construed as
if the invalid, illegal, or unenforceable provision had never been contained
therein. This Agreement shall replace in full any existing agreement that
Executive has with BANK.
Section XI. Arbitration
A. In the event of any dispute or claim arising out of or relating to this
Agreement, or to any interpretation of any terms hereof, or of any action to be
taken or not be taken by any of the parties hereto in compliance herewith, or as
to the breach hereof such matters shall be settled exclusively by submission to
arbitration in accordance with the rules of the American Arbitration Association
of the City of Philadelphia.
In Witness Whereof, the parties have executed this Agreement on the day and
year first hereinabove written.
BankPhiladelphia
Xxxxxxx X. Xxxxxx
President and Chief Executive Officer
______________________
Attest: ______________________
Xxxxx X. Xxxxx - Executive
______________________
Witness: ______________________
