Exhibit 10.3
EXECUTIVE EMPLOYMENT AGREEMENT
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THIS AGREEMENT is made as of the 21st day of December, 2001, between
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Peoples Financial Corp., Inc.. (the "Corporation") and PFC (the
"Bank"), and X.X. Xxxxxxxxx (the "Executive").
WHEREAS, the Bank is a subsidiary of the Corporation; and
WHEREAS, any reference to "Corporation" shall mean Corporation or Bank;
WHEREAS, the Corporation and Bank desire to employ the Executive as
President and Chief Executive Officer under the terms and conditions set forth
herein; and
WHEREAS, the Executive desires to serve the Corporation and Bank in an
executive capacity under the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, and intending to be legally bound hereby, the parties agree as
follows:
1. TERM OF EMPLOYMENT.
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(a) General. The Corporation and Bank hereby shall employ the
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Executive and the Executive hereby accepts employment with the
Corporation and Bank for a term of two (2) year(s) beginning on
January 1, 2002, and ending two years later (the "Employment
Period"), subject, however, to prior termination of this
Agreement as set forth below.
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(b) At the end of the first Employment Period, this Agreement shall
renew automatically and the Employment Period shall be modified
to one year and extended for successive additional periods of one
year each, unless the Executive or the Corporation and/or Bank,
at least thirty (30) days before the expiration of first two year
period or the expiration of any one year extension, pursuant to
this Section 1(b) gives written notice to the other of intention
not to renew this Agreement.
2. POSITION AND DUTIES. The Executive shall serve as the President and
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CEO of the Corporation and Bank, reporting only to the Board of
Directors of the Corporation and Bank and shall have such other powers
and duties as may from time to time be prescribed by the Board of
Directors of the Corporation and Bank, provided that such duties are
consistent with the Executive's position as President and CEO.
3. ENGAGEMENT IN OTHER EMPLOYMENT. The Executive will devote his full
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attention, time and energies to the business of Corporation, Bank and
any of their subsidiaries or affiliates. The Executive shall neither
engage in any business or commercial activities, duties or pursuits
which compete with the business or commercial activities of the
Corporation, Bank or any of their subsidiaries or affiliates, nor
serve as a director or officer or in any other capacity in a company
which competes with the Corporation, Bank or any of their subsidiaries
or affiliates. The Corporation, the Executive may engage in voluntary
or philanthropic endeavors.
4. COMPENSATION.
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(a) Annual Direct Salary. As compensation for services rendered the
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Corporation and Bank under this Agreement, the Executive shall be
entitled to receive from the Corporation or Bank an annual direct
salary of Two Hundred Thirty-Two Thousand, One Hundred
Seventy-Five Dollars and Ninety-Seven Cents ($232,175.97) per
year (the "Annual Direct Salary"), payable in substantially equal
monthly installments (or such other intervals, consistent with
the Bank's payroll policy), prorated for any partial
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employment period. The Annual Direct Salary shall be reviewed
annually, no later than December 31 of the then calendar year and
shall be subject to such annual change (but not reduced below Two
Hundred Thirty-Two Thousand One Hundred and Seventy-Five Dollars
and Ninety-Seven Cents ($232,175.97) without the Executive's
written consent, except in cases of national financial depression
or emergency when compensation reduction has been implemented by
the Board of Directors for the Bank's senior management) as may
be set by the Board of Directors of the Corporation and Bank
taking into account the position and duties of the Executive and
the performance of the Corporation and Bank under the Executive's
leadership.
(b) Bonus. The Board of Directors of the Corporation, in its sole
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discretion may provide for payment of a periodic bonus to the
Executive in such an amount or nature as it may deem appropriate
to provide incentive to the Executive and to reward the Executive
for his performance. To assist the Board in evaluating the
Executive's performance, for purposes of a bonus, the Board will,
at its, discretion set target goals and objectives for the
Executive at the beginning of each year.
5. FRINGE BENEFITS, VACATION, EXPENSES, AND PERQUISITES.
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(a) Employee Benefit Plans. The Executive shall be entitled to
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participate in or receive benefits under all Bank employment
benefit plans including, but not limited to, any pension plan,
profit-sharing plan, savings plan, life insurance plan or
disability insurance plan as made available by the Bank to its
employees, subject to and on a basis consistent with terms,
conditions and overall administration of such plans and
arrangements.
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(b) Vacation, Holidays, Sick Days and Personal Days. The Executive
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shall be entitled to the number of paid vacation days in each
calendar year determined by the Corporation and/or the Bank from
time to time for its senior executive officers, but no less than
three (3) weeks in any calender year. The Executive shall also be
entitled to all paid holidays, sick days and personal days given
by the Corporation and/or the Bank to its employees.
(c) Business Expenses. During the term of his employment hereunder,
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the Executive shall be entitled to receive prompt reimbursement
for all reasonable expenses incurred by him, which are properly
accounted for, in accordance with the policies and procedures
established by the Board of Directors of the Corporation and/or
the Bank for its senior executive officers.
(d) Special Disability Benefit. In addition to the Bank's regular
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disability benefits available under the Bank's then existing
short term and/or long term disability plans, in the event the
Executive is fully or partially disabled, the Bank shall pay to
the Executive, or upon his death, to his wife Xxxxx Xxxxxxxxx, a
gross monthly sum of $1,200.00 until the end of the applicable
Employment Period as set forth in Section 1 of this Agreement.
The terms "fully or partially disabled" shall have the meaning
attributed to them in the current Bank group short term and/or
long term disability program, or if said Bank group disability
program is terminated, in the Bank's employment policies, as the
same may be amended from time to time. In the event that
Executive dies after becoming disabled, but prior to receiving
all the monthly sums set forth above, Executive's wife shall
receive any remaining payments due thereafter.
(e) Special Retirement Benefit. Commencing on the last day of
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Executive's performance of any work or services for the Bank, the
Bank shall pay the Executive or, upon his death, to his wife,
Xxxxx Xxxxxxxxx, until her death, a 100% Joint and Survivor
Benefit consisting of a gross monthly sum of One Thousand Two
Hundred dollars $1,200.00. In no event shall Executive or his
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wife receive both the Special Disability Benefit and the Special
Retirement Benefit; accordingly, if Executive becomes disabled
and then retires, the Bank's obligations under the Special
Disability Benefit provisions are released and the only Special
Benefit obligations owed to Executive are those under this
"Special Retirement Benefit" provision.
6. OFFICES. The Executive agrees to serve without additional compensation
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as a director on the Board of Directors of the Bank and Corporation
and, if elected or appointed thereto, without additional compensation
in one or more offices of the Bank and Corporation, and/or in one or
more offices or as a director of any of the Bank and/or Corporation's
non-banking subsidiaries; provided, however, the Executive shall not
be required to serve in such additional offices or as a director of
the Bank and/or Corporation or any subsidiary if such service would
expose him to adverse financial consequences.
7. LIABILITY INSURANCE. The Bank and/or the Corporation shall use its
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best efforts to obtain insurance coverage for the Executive under an
insurance policy covering officers and directors of the Bank and
Corporation against lawsuits, arbitrations or other legal or
regulatory proceedings; however, nothing herein shall be construed to
require the Bank and/or the Corporation to obtain such insurance, if
the Board of Directors of the Bank and/or the Corporation determine
that such coverage cannot be obtained at a reasonable price.
8. UNAUTHORIZED DISCLOSURE. During the term of his employment hereunder,
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or at any later time, the Executive shall not, without the written
consent of the Board of Directors of the Corporation or Bank or a
person authorized thereby, knowingly disclose to any person, other
than an employee of the Corporation or Bank or a person to whom
disclosure is reasonably necessary or appropriate in connection with
the performance by the Executive of his duties as an executive of the
Corporation or Bank, any confidential information, trade secrets, or
know how, obtained by him while in the employ of the Corporation or
Bank. Confidential information includes any services, products,
improvements, formulas, projects, proposals, designs or styles,
processes, customers,
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(including, but not limited to, customers of Corporation, Bank or any
of their affiliates or subsidiaries on whom the Executive called or
with whom he became acquainted during the term of his employment),
methods of business or any business practices, research, product or
business plans, customer lists, markets, software, developments,
inventions, technology, drawings, engineering, marketing, distribution
and sales methods and systems, finances, sales and profit figures, and
other business information of Corporation, Bank or any of their
subsidiaries or affiliates, the disclosure of which could be or will
be materially damaging to the Corporation, Bank or any of their
subsidiaries or affiliates, provided, however, that confidential
information shall not include any information known generally to the
public (other than as a result of unauthorized disclosure by the
Executive or any person with the assistance, consent or direction of
the Executive) or any information of a type not otherwise considered
confidential by persons engaged in the same business or a business
similar to that conducted by the Corporation or Bank or any
information that must be disclosed as required by law.
9. WORK MADE FOR HIRE. Any work performed by the Executive under this
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Agreement should be considered a "Work Made for Hire" as that phrase
is defined by the U.S. patent laws and shall be owned by and for the
express benefit of Corporation, Bank and any of their subsidiaries and
affiliates. In the event it should be established that such work does
not qualify as a Work Made for Hire, the Executive agrees to and does
hereby assign to Corporation, Bank and their affiliates and
subsidiaries, all of his rights, title, and/or interest in such work
product, including, but not limited to, all copyrights, patents,
trademarks, and proprietary rights.
10. RETURN OF COMPANY PROPERTY AND DOCUMENTS. The Executive agrees that,
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at the time of termination of his employment, regardless of the reason
for termination, he will deliver to Corporation or Bank, any and all
company property, including, but not limited to, equipment, keys,
security codes or passes, mobile telephones, pagers, computers,
devices, confidential information (as defined in this Agreement),
records, data, notes, reports, proposals, lists, correspondence,
specifications, drawings, blueprints, sketches,
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software programs, other documents or property, or reproductions of
any of the aforementioned items developed or obtained by the Executive
during the course of his employment. The Executive further agrees to
sign and return the "Termination Certificate" attached hereto as
Exhibit "A," together with all company property within three (3) days
of the date of termination of the Executive's employment.
11. RESTRICTIVE COVENANT.
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(a) Non-competition and Non-solicitation. The Executive hereby
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acknowledges and recognizes the highly competitive nature of the
business of Corporation and Bank and accordingly agrees that, for
the applicable period set forth in Section 11(c) hereof,
Executive shall not:
(i) be engaged, directly or indirectly, either for his own
account or as agent, consultant, employee, partner,
officer, director, proprietor, investor (except as an
investor owning less than 5% of the stock of a publicly
owned company) or otherwise of any person, firm,
corporation or enterprise engaged in (1) the banking or
financial services industry (including a bank or thrift
holding company), or (2) any other activity in which
Corporation, Bank or any of their subsidiaries or
affiliates are engaged during the Employment Period, in any
county in which, at any time during the Employment Period
or on the date of termination of the Executive's
employment, a branch, office or other facility of
Corporation or any of its subsidiaries is located, or in
any county contiguous to such a county, including
contiguous counties located outside of the Commonwealth of
Pennsylvania (the "Non-Competition Area"); or
(ii) provide financial or other assistance to any person, firm,
corporation, or enterprise engaged in (1) the banking or
financial services industry (including bank holding
company), or (2) any other activity in which Corporation,
Bank or any of their subsidiaries or affiliates are engaged
during the Employment Period in the Non-Competition Area;
or
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(iii) directly or indirectly contact, solicit or induce any
person, firm, corporation or other entity who or which is a
customer or referral source of Corporation, Bank or any of
their subsidiaries or affiliates during the term of
Executive's employment or at the date of termination of
Executive's employment, to become a client, customer or
referral service of any other person, firm, Corporation or
other entity; or
(iv) directly or indirectly solicit, induce or encourage any
employee of Corporation, Bank or any of their subsidiaries
or affiliates, who is employed during the term of
Executive's employment or at the date of termination of
Executive's employment, to leave the employ of Corporation,
Bank or any of their subsidiaries or affiliates or to seek,
obtain or accept employment with any person or entity other
than Corporation, Bank or any of their subsidiaries or
affiliates.
(b) Amendment of Restrictive Covenant. It is expressly understood and
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agreed that, although Executive, Corporation and Bank consider
the restrictions contained in Section 11(a) reasonable for the
purpose of preserving for Corporation, Bank and any of their
subsidiaries or affiliates, their good will and other proprietary
rights, if a final judicial determination is made by a court
having jurisdiction that the time or territory or any other
restriction contained in Section 11(a) is an unreasonable or
otherwise unenforceable restriction against the Executive, the
provisions of Section 11(a) shall not be rendered void, but shall
be deemed amended to apply as to such maximum time and territory
and to such other extent as such court may judicially determine
or indicate to be reasonable.
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(c) Period of Restrictive Covenant. The provisions of this Section 11
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shall be applicable, commencing on the date this Agreement is
entered and ending two (2) years after the effective date of
termination of employment.
(d) Breach of Restrictive Covenant. It is expressly understood and
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agreed that if the Executive violates or breaches any provisions
of this Section 11, then the provisions of this Section 11 shall
apply to the Executive for an additional one (1) year following
the date of such violation or breach.
12. TERMINATION.
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(a) Death. With the exception of the benefits provided under the
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Special Disability Benefits and/or Special Retirement Benefits
provided in Section 5(d) and (e), notwithstanding any other
provisions of this Agreement, this Agreement shall terminate
automatically upon the Executive's death and the Executive's
rights under this Agreement shall cease as of the date such
termination.
(b) Disability. Notwithstanding any other provisions of this
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Agreement, if, as a result of physical or mental injury or
impairment, Executive is unable to perform all of the essential
job functions of his position on a full time basis, with or
without a reasonable accommodation, and without posing a direct
threat to himself and others, for a period of sixty-five (65)
days, all obligations of Bank and Corporation to pay Executive an
Annual Direct Salary as set forth in Section 4(a) of this
Agreement are suspended. Any paid time off, sick leave, or short
term disability pay Executive may be entitled to receive,
pursuant to an established disability plan or program of the Bank
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and/or Corporation shall be considered part of the compensation
Executive shall receive while disabled and shall not be in
addition to the compensation received by Executive under this
provision of the Agreement. Executive agrees that should he
remain unable to perform all of the essential functions of his
position on a full time basis, with or without a reasonable
accommodation and without posing a direct threat to himself or
others, after sixty-five (65) days, the Bank and/or Corporation
will suffer an undue hardship by continuing Executive in his
position. Upon this event, all compensation and employment
obligations of the Bank and Corporation under this Agreement
shall cease (with the exception of Executive's rights under
Section 5(d) of this Agreement and the Bank's then existing short
term and/or long term disability plans, if any), and this
Agreement shall terminate.
(c) Cause. Notwithstanding any other provisions of this Agreement,
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the Bank and/or Corporation may terminate the Executive's
employment hereunder for "Cause."As used in this Agreement, the
Bank and/or Corporation shall have "Cause" to terminate the
Executive's employment hereunder upon: (i) the willful failure by
the Executive to substantially perform his duties hereunder
(other than a failure resulting from the Executive's incapacity
because of physical or mental illness, as provided in Section
12(b) hereof), after notice from the Corporation or Bank and a
failure to cure such violation within fifteen (15) days of said
notice ; (ii) the willful engaging by the Executive in misconduct
injurious to the Corporation or Bank; (iii) the willful violation
by the Executive of the provisions of Sections 3, 8, 9 or 10
hereof, after notice from the Corporation or Bank and a failure
to cure such violation within fifteen (15) days of said notice;
(iv) the dishonesty or gross negligence of the Executive in the
performance of his duties; (v) the breach of Executive's
fiduciary duty involving personal profit; (vi) the violation of
any law, rule or regulation governing banks or bank officers or
any final cease and desist order issued by a bank regulatory
authority; (vii) conduct on the part of
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Executive which brings public discredit to the Corporation or
Bank; (viii) unlawful discrimination by the Executive, including
harassment against Corporation or Bank's employees, customers,
business associates, contractors, or visitors; (ix) theft or
abuse by Executive of the Corporation or Bank's property or the
property of Corporation or Bank's customers, employees,
contractors, vendors, or business associates; (x) failure of the
Executive to follow the good faith lawful instructions of the
Board of Directors of Corporation or Bank with respect to its
operations, after notice from the Corporation or Bank and a
failure to cure such violation within fifteen (15) days of said
notice; (xi) the direction or recommendation of a state or
federal bank regulatory authority to remove the Executive's
position with Corporation and/or Bank as identified herein; (xii)
any final removal or prohibition order to which the Executive is
subject, by a federal or state banking agency pursuant to Section
8(e) of the Federal Deposit Insurance Act or Section 2005 of the
Pennsylvania Banking Code of 1965; (xiii) the Executive's
conviction of or plea of guilty or nolo contendere to a felony,
crime of falsehood or a crime involving moral turpitude, or the
actual incarceration of Executive; (xiv) any act of fraud,
misappropriation or personal dishonesty; (xv) insubordination;
(xvi) misrepresentation of a material fact, or omission of
information necessary to make the information supplied not
materially misleading, in an application or other information
provided by the Executive to the Corporation or any
representative of the Corporation in connection with the
Executive's employment with Corporation; (xvii) the existence of
any material conflict between the interests of Corporation and
the Executive that is not disclosed in writing by the Executive
to the Corporation and approved in writing by the Board of
Directors of Corporation; or (xviii) the Executive takes action
that is clearly contrary to the best interest of the Corporation.
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(d) Termination by Executive. The Executive may terminate his
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employment hereunder if (i) his health should become impaired to
an extent that it makes continued performance of his duties
hereunder hazardous to his physical or mental health or his life,
or (ii) for Good Reason. The term "Good Reason" shall mean (1)
any assignment to the Executive, without his consent, of any
duties other than those contemplated by, or any limitation of the
powers of the Executive not contemplated by Section 2 hereof; or
(2) any removal of the Executive from any of the positions
indicated in Section 2 hereof, except as a result of his
regulatory removal and/or in connection with termination of the
Executive's employment for Cause; or (3) failure of the Bank to
comply with Section 2 hereof, all after notice from the Executive
to the Corporation and Bank that such action or limitation of the
Bank or Corporation constitutes Good Reason and the failure to
cure such situation within thirty (30) days of said notice, or if
said situation cannot be cured within thirty (30) days, within a
reasonable time thereafter if a diligent effort is being made by
the Corporation and/or the Bank to cure such situation.
13. PAYMENTS UPON TERMINATION ABSENT A CHANGE IN CONTROL.
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(a) If the Executive's employment is terminated by the Executive
because of his health as described in Section 12(d)(i) hereof, or
if the Executive's employment is terminated by the Bank or
Corporation because of Executive's death, disability or for Cause
(as defined herein), the Corporation shall pay the Executive his
full Annual Direct Salary through the date of termination at the
rate in effect at the time of termination and the Corporation and
Bank shall have no further obligation to the Executive under this
Agreement except in the event the Executive is terminated because
of his health described in Section 12(d)(i), Executive shall
receive the Special Disability Benefit or the Special Retirement
Benefit as the case may be.
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(b) If the Executive's employment is terminated by the Corporation or
Bank other than pursuant to Sections 12(a) Death; 12(b)
Disability; or 12(c) Cause hereof, then the Corporation shall pay
the Executive a lump sum equal to his full Annual Direct Salary
from the date of termination through the last day of the current
Employment Period or an amount equal to his then Annual Direct
Salary, whichever is less.
(c) If the Executive shall terminate his employment for Good Reason,
pursuant to Section 12(d)(ii)(1), (2), or (3), then the
Corporation shall continue to pay the Executive on a periodic
basis, amounts which total his full Annual Direct Salary from the
date of termination through the last day of the current
Employment Period.
14. PAYMENTS UPON TERMINATION FOLLOWING A CHANGE IN CONTROL.
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(a) If a Change in Control (as defined herein) shall occur, then at
the option of Executive, exercisable by Executive within thirty
(30) days of the Change of Control, Executive may resign from
employment with Corporation and Bank (or, if involuntarily
terminated, give notice of intention to collect benefits under
this Agreement) by delivering a notice in writing (the "Notice of
Termination") to Corporation and Bank and the provisions of
Section 14 (c) of this Agreement shall apply.
(b) During the period of time between the execution of an agreement
to effect a Change in Control (as defined herein) and the Date of
the Change in Control (as defined herein), Executive's employment
may only be terminated by the Corporation or Bank for Death,
Disability, or Cause (as defined herein). If, during that period
of time, Executive's employment is terminated by the Corporation
or Bank for Death, Disability or for Cause (as defined herein),
then all rights of Executive, other than those specifically
preserved in Section 5(d) and (e) under this Agreement shall
cease as of the effective date of such termination. If, during
that period Executive's employment is terminated by the
Corporation or Bank other than for Death, Disability or
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Cause (as defined herein), then Executive may give notice of
intention to collect benefits under this Agreement by delivering
a notice in writing ("Notice of Termination") to Corporation and
Bank and the provisions of Section 14(c) of this Agreement shall
apply.
(c) In the event that Executive delivers a Notice of Termination (as
defined in Section 14(a) of this Agreement) to Corporation and
Bank, following the Change in Control, Executive shall be
entitled to receive the compensation and benefits set forth
below:
Corporation shall pay Executive a lump sum amount equal to and no
greater than two (2.0) times the Executive's Annual Direct Salary
as defined in Section 4(a), minus applicable taxes and
withholdings. In addition, for a period of two (2) years from the
date of termination of employment, or until Executive secures
substantially similar benefits through other employment,
whichever shall first occur, Executive shall receive a
continuation of any group health care, life and disability
insurance in effect with respect to Executive during the year
prior to his termination of employment. If Executive is not
permitted continued participation after termination, pursuant to
the terms or conditions of the plans or contracts, Corporation
shall pay to Executive, a dollar amount equal to the cost to
Executive of obtaining such benefits (or substantially similar
benefits). However, in the event the payment described herein,
when added to all other amounts or benefits provided to or on
behalf of the Executive in connection with his termination of
employment, would result in the imposition of an excise tax under
Code Section 4999, such payments shall be retroactively (if
necessary) reduced to the extent necessary to avoid such excise
tax imposition. Upon written notice to Executive, together with
calculations of Corporation's independent auditors, Executive
shall remit to Corporation the amount of the reduction, plus such
interest, as may be necessary to avoid the imposition of such
excise tax. Notwithstanding the foregoing or any other provision
of this contract to the contrary, if any portion of the amount
herein payable to the Executive is determined to be
non-deductible pursuant to the regulations promulgated under
Section 280G of the Internal Revenue Code of 1986, as amended
(the "Code"), the Corporation shall be required only to pay to
Executive the amount determined to be deductible under Section
280G.
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15. DEFINITION OF CHANGE IN CONTROL. For purposes of this Agreement, the
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term "Change in Control" shall mean: A change in control (other than
one occurring by reason of an acquisition of the Corporation or Bank
by Executive) of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A and any
successor rule or regulation promulgated under the Securities Exchange
Act of 1934 (the "Exchange Act") if Corporation or Bank were subject
to the Exchange Act reporting requirements; provided that, without
limiting the foregoing, such a change in control shall be deemed to
have occurred if:
(a) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act), other than the Corporation or Bank or any
"person" who on the date hereof is a director or officer of the
Corporation or Bank is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation or Bank representing
twenty-five percent (25%) or more of the combined voting power of
the Corporation's or Bank's then outstanding securities, or
(b) during any period of two (2) consecutive years during the term of
Executive's employment under this Agreement, individuals who at
the beginning of such period constitute the Board of Directors of
the Corporation or Bank cease for any reason to constitute at
least a majority thereof, unless the election of each director
who was not a director at the beginning of such period has been
approved in advance by directors representing at least two-thirds
of the directors then in office who were directors at the
beginning of the period;
(c) a merger, consolidation or business combination with the
Corporation and/or Bank occurs.
16. DEFINITION OF DATE OF CHANGE IN CONTROL. For purposes of this
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Agreement, the Date of Change in Control shall mean:
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(a) the first date on which a single person and/or entity, or group
of affiliated persons and/or entities, acquire the beneficial
ownership of twenty-five percent (25%) or more of the
Corporation's voting securities, or
(b) the date of the closing of an Agreement, transferring all or
substantially all of the Bank or Corporation's assets, or
(c) the date on which a merger, consolidation or business combination
is consummated, as applicable, or
(d) the date on which individuals who formerly constituted a majority
of the Board of Directors of the Bank or Corporation under
Section 16(b) hereof, ceased to be a majority.
17. DAMAGES FOR BREACH OF CONTRACT. In the event of a breach of this
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Agreement by either the Corporation, Bank or the Executive resulting
in damages to another party to this Agreement, that party may recover
from the party breaching the Agreement, only those damages as set
forth herein. In no event shall any party be entitled to the recovery
of attorney's fees or costs.
18. ARBITRATION. Corporation, Bank and Executive recognize that in the
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event a dispute should arise between them concerning the
interpretation or implementation of this Agreement, lengthy and
expensive litigation will not afford a practical resolution of the
issues within a reasonable period of time. Consequently, with the
exception of the Restrictive Covenant provisions in Section 11, which
the Corporation or Bank may seek to enforce in any court of competent
jurisdiction, each party agrees that all disputes, disagreements and
questions of interpretation concerning this Agreement are to be
submitted for resolution, in Harrisburg, Pennsylvania, to the American
Arbitration Association (the "Association") in accordance with the
Association's National Rules for the Resolution of Employment Disputes
or other applicable rules
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then in effect ("Rules"). Corporation, Bank or Executive may initiate
an arbitration proceeding at any time by giving notice to the other in
accordance with the Rules. Corporation, Bank and Executive may, as a
matter or right, mutually agree on the appointment of a particular
arbitrator from the Association's pool. The arbitrator shall not be
bound by the rules of evidence and procedure of the courts of the
Commonwealth of Pennsylvania but shall be bound by the substantive law
applicable to this Agreement. The arbitration proceeding and all
filing, testimony, documents, and information, relating to or
presented during the evaluation proceeding, shall be disclosed
exclusively for the purpose of facilitating the arbitration process
and for no other purpose and shall be deemed to be information subject
to the confidentiality provisions of this Agreement. The decision of
the arbitrator, absent fraud, duress, incompetence or gross and
obvious error of fact, shall be final and binding upon the parties and
shall be enforceable in courts of proper jurisdiction. Following
written notice of a request for arbitration, Corporation, Bank and
Executive shall be entitled to an injunction restraining all further
proceedings in any pending or subsequently filed litigation concerning
this Agreement, except as otherwise provided herein.
19. NOTICE. For the purposes of this Agreement, notices and all other
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communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when hand-delivered or mailed
by United States certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Executive: X.X. Xxxxxxxxx
X.X. Xxx 000
Xxx Xxxxxxxxx, XX 00000
If to the Bank: Xxxxx X. Xxxxx
Chairman of the Board
PFC Bank
X.X. Xxx 000
Xxxx Xxxx, XX 00000
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If to the Corporation: Xxxxx X. Xxxxx
Chairman of the Board
Peoples Financial Corporation
X.X. Xxx 000
Xxxx Xxxx, XX 00000
or to such other address as any party may have furnished to the other
in writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
20. SUCCESSORS. This Agreement shall inure to the benefit of and be
----------
binding upon the Executive, his personal representatives,
heirs or assigns and to the Bank and/or the Corporation and any of
their successors or assigns.
21. SEVERABILITY. If any provision of this Agreement is declared
------------
unenforceable for any reason, the remaining provisions of
this Agreement shall be unaffected thereby and shall remain in full
force and effect.
22. AMENDMENT. This Agreement may be amended or canceled only by mutual
---------
agreement of the parties in writing.
23. PAYMENT OF MONEY DUE DECEASED EXECUTIVE. In the event of Executive's
---------------------------------------
death, any monies that may be due him from the Corporation or Bank
under this Agreement as of the date of death, shall be paid to the
person designated by him in writing for this purpose, or in the
absence of any such designation, to his spouse or estate.
24. LAW GOVERNING. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the Commonwealth of Pennsylvania.
25. ENTIRE AGREEMENT. This Agreement supersedes any and all agreements,
----------------
either oral or in writing, between the parties with respect to the
employment of the Executive by the Corporation and Bank, and this
Agreement contains all the covenants and agreements between the
parties with respect to the subject matter of this Agreement.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby,
have caused this Agreement to be duly executed in their respective names and, in
the case of the Corporation and Bank, by its authorized representatives the day
and year above mentioned.
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ATTEST: PEOPLES FINANCIAL CORP., INC.
S/Xxxxxxx X. Xxxxxxxxx By: S/Xxxxx X. Xxxxx
-------------------------------- --------------------------------
Xxxxxxx X. Xxxxxxxxx Xxxxx X. Xxxxx
Secretary Chairman
ATTEST: PFC BANK, INC.
S/Xxxxxxx X. Xxxxxxxxx By: S/Xxxxx X. Xxxxx
-------------------------------- --------------------------------
Xxxxxxx X. Xxxxxxxxx Xxxxx X. Xxxxx
Secretary Chairman
WITNESS:
S/Xxxxx X. Xxxxx S/X. X. Xxxxxxxxx
-------------------------------- --------------------------------
X.X. Xxxxxxxxx
"Executive":
EXHIBIT A
TERMINATION CERTIFICATE
This is to certify that I do not have in my possession, nor have I failed
to return, any equipment, keys, security codes or passes, mobile telephones,
pagers, computers, devices, confidential information, records, data, notes,
reports, proposals, lists, correspondence, specifications, drawings, blueprints,
or reproductions of any aforementioned items belonging to Peoples Financial
Corp., Inc., PFC Bank or any of their affiliates or subsidiaries, or any of
their respective successors or assigns (together, the "Company").
I further certify that I have complied and will continue to comply with all
the terms of the Executive Employment Agreement entered by me, which took effect
on January 1, 2002.
Without limiting the generality of the preceding paragraph, I will, in
accordance with my Employment Agreement, preserve as confidential, all
proprietary and confidential information, trade secrets and know-how of Peoples
Financial Corp., Inc., PFC Bank or any of their affiliates or subsidiaries,
including, but not limited to, research, product or business plans, products,
services,
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projects, proposals, customer lists or customers (including, but not limited to,
customers of Peoples Financial Corp., Inc., PFC Bank or any of their affiliates
or subsidiaries on whom I called or with whom I became acquainted during the
term of my employment), markets, software, developments, inventions, processes,
formulas, technology, designs or styles, drawings, engineering, marketing,
distribution, and sales methods and systems, sales and profit figures, finances
and other business information disclosed to me by Peoples Financial corp., Inc.,
The PFC Bank or any of their affiliates or subsidiaries, either directly or
indirectly in writing, orally or by drawings or inspection of documents or on
other tangible property.
Date:
------------------------------ ------------------------------------
Signature
----------------------------------- ------------------------------------
Witness X.X. Xxxxxxxxx
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