EMPLOYMENT AGREEMENT
This Agreement made this 10th day of November 1997, by and between NORTH
VALLEY BANCORP, a California bank holding company, and NORTH VALLEY BANK, a
California banking corporation, (collectively, the "Employer"), and Xxxxx X.
Xxxxx ("Employee").
IT IS AGREED:
1.Employment. The Employer hereby employs the Employee and the Employee
hereby accepts the employment upon the terms and conditions set forth herein.
2. Duties. Employee shall perform the customary and necessary duties of
the President and Chief Executive Officer of a bank holding company and as
President and Chief Executive Officer of its subsidiaries NORTH VALLEY BANK,
NORTH VALLEY TRADING COMPANY, NORTH VALLEY BASIC SECURITIES, NORTH VALLEY BANK
SCHOLARSHIP FUND AND BANK PROCESSING, INC.
3. Term.The contract is retroactively effective to June 1,1997 and is
terminable as otherwise provided herein.
4. Salary. Performance of the duties under this agreement entitles
Employee to a $155,823.00 annual salary. In January of each year of the
EXHIBIT 10(e)
1
agreement, the Board of Directors of Employer will conduct a review of the
performance of Employee and will determine in their sole discretion an increase
in the annual salary of Employee.
5. Extent of Services. Employee acknowledges that the duties under this
Agreement require his full time attention and best efforts and agrees not to
accept any gainful employment elsewhere during its term.
6. Vacation. The Employee shall be entitled to six (6) weeks' vacation
annually pursuant to the provisions of the vacation policies established by the
Employer but which shall not exceed two (2) weeks at any one time.
7. Other Benifits. Employee shall be entitled to the use of an Employer
owned automobile and membership at Riverview Golf and Country Club.
8. Expenses. The Employee is authorized to incur reasonable expenses in
conducting his duties hereunder, including expenses for entertainment, travel,
shareholder relations and similar items. The Employer shall pay directly or
shall reimburse Employee for all such expenses upon presentation by the
Employee, from time to time, of an itemized account of such expenditures.
9. Insurance.
(a) Employer hereby agrees, at its sole cost and expense, to provide
Employee with, at all times during the term of this Agreement, health
and term life insurance of a type and in an amount generally made
available by employer to its executive employees.
2
(b) At the expiration of the time period set forth in Section 11(a)
below, unless this agreement shall terminate for reasons set forth in
Section 10(c) below, Employee and/or his surviving spouse, until each
shall reach the age of 65, shall have the right to purchase from
Employer or its successor, the above described insurance provided by
Employer for Employee and Employee's spouse under this agreement by
reimbursing Employer its true cost of same.
10. Termination with Cause. This Agreement shall terminate immediately
upon the occurrence of:
(a) Death of Employee.
(b) Permanent and incapacitating disability for a period of not less
than one hundred and eighty (180) days which reasonably renders Employee
unable to fulfill the duties of the Agreement.
(c) The receipt of notice of termination in the event Employee
willfully or habitually breached the terms of this Agreement or
committed illegal or improper acts which would reasonably require his
dismissal or for other grounds specified in section 2924 of the
California Labor Code.
11. Termination without Cause. This Agreement may also be terminated
without cause and upon ten (10) days written notice, but not prior to January
1,1998.
3
(a) Employee will then continue in the employment of Employer, or
its successor, as a consultant with the same annual salary and benefits
for the remainder of the calendar year following the ten (10) day notice
period.
(b) At the end of the period so determined, Employee shall
additionally and immediately receive a severance payment of not less
than his total annual base salary at the time of termination reduced by
any payment made pursuant to Section 11(a).
Example: Employer gives Employee notice of termination effective
January 1,1998. Employee will continue to be employed through December
31, 1998. Employment would terminate on January 1,1999 and Employee
would be entitled to severance compensation equal to ten (10) days of
his annual base salary.
(c) In the event that a "Change of Control" as defined herein should
occur during a period beginning June 1,1997 and ending twelve (12)
months after the date of written notice of termination, then the amount
of severance payment due Employee under Section 11(b) shall be two times
his total annual base salary at the time of termination reduced by any
payments made pursuant to Section 11(a).
(d) For all purposes under this agreement, the term "Change in
Control" shall mean the occurrence of either of the following events:
4
(i) A change in the composition of the Company's Board of Directors
occurs at any time within 12 months after the date of written notice of
termination of Employee, as a result of which fewer than one-half of the
incumbent directors are directors who had been directors of the Company
on the date of written notice of termination of Employee; or
(ii) Any person(s) or entity(s) by the acquisition or aggregation of
securities, within 12 months after the date of written notice of
termination of Employee, becomes the beneficial owner, directly or
indirectly, of securities of the Company representing 50% or more of the
combined voting power of the Company's then outstanding securities or by
the acquisition, by any means, of all or substantially all of the assets
of the Company.
(e) Employee may voluntarily terminate this Agreement at any time
upon thirty (30) days written notice to Employer. The term of employment
will end at the end of such time and no further salary shall be paid.
Employee would continue to have the rights granted under Section 9(b).
12. Confidentiality. Employee agrees that he will not during the term of
this Agreement or at any time thereafter, either directly or indirectly,
disclose or make known to any other person, firm or corporation any confidential
information, trade secret, processes or names or addresses of any of the
customers of Employer, or any other information pertaining to said customers
that he may acquire in the performance of his duties hereunder, nor will
5
Employee make use of any such information, secrets, processes or names or
addresses or other information for his own commercial purposes or for the
benefit of any person, firm, corporation or other entity (other than Employer)
under any circumstances, during or after the term of his employment. Employee
acknowledges and agrees that he has been privy to valuable confidential
information, trade secrets, processes and customer information belonging to
Employer. Upon termination of his employment by Employer, Employee agrees
forthwith to deliver to Employer any and all literature, documents,
correspondence, and other materials and records furnished to him during the
course of such employment.
13. Remedies for Breach. In the event of a breach by either party of any
of the terms and conditions of this Agreement to be performed by either, each
shall have the right to institute and prosecute proceedings, in law or in
equity, in any court of competent jurisdiction to obtain any injunction during
the term of this Agreement or after its termination to enforce the provisions of
Sections 9(b), 11 and 12 hereof and to pursue any other remedy which either
party may be entitled.
14. Notice. Any written notice required under this Agreement shall be
sufficiently served by any provable method at the principle place of business of
Employer or his residence in the case of Employee.
15. Waiver of Breach. The waiver by either party of the breach of any
provisions of this Agreement by either party shall not operate or be construed
as a waiver of any subsequent breach by either party.
6
16. Assignment. The rights and obligations of the Employer under this
Agreement shall inure to the benefit of and shall be binding upon the successors
and assigns of the Employer; however, the rights and benefits of the Employee
under this Agreement are personal to him, and no right or benefit accruing to
the Employee under this Agreement shall be subject to voluntary or involuntary
alienation, assignment, or transfer. Nothing in this Section shall limit the
rights of the spouse of Employee under Section 9(b).
17. Entire Agreement. This Agreement represents the entire agreement of
the parties and any modifications hereto shall be in writing signed by the
parties.
7
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
EMPLOYER EMPLOYEE
NORTH VALLEY BANCORP
By /s/ Xxxx X. Xxxxx /s/ Xxxxx X. Xxxxx
----------------------------- ----------------------------
Xxxx X. Xxxxx Xxxxx X. Xxxxx
Chairman of the Board
NORTH VALLEY BANK
By /s/ Xxxx X. Xxxxx
-----------------------------
Xxxx X. Xxxxx
Chairman of the Board
8
