EMPLOYMENT AND OPTION AGREEMENT
This Employment And Option Agreement (the "Agreement") is made as of
the 5th day of December, 1996, by and between Community Capital Corporation, a
South Carolina corporation ("Employer"), and Xxxxxxxx X. Xxxxxx, Xx.
("Employee").
WHEREAS, Employer is a bank holding company; and
WHEREAS, Employer desires to employ Employee, and Employee desires to
be employed by Employer, in accordance with the terms and conditions hereinafter
set forth:
NOW, THEREFORE, in consideration of the mutual promises herein set
forth, and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties, intending to be legally bound, agree
as follows:
1. Employment. Employer hereby agrees to employ Employee to perform the
duties described in Section 3 below subject to and in accordance with the terms
and conditions hereof, and Employee hereby accepts such employment.
2. Term. The employment shall commence on the date hereof, and shall
continue for an initial term of two (2) years, unless earlier terminated in
accordance with Section 8 hereof.
3. Duties of Employee.
A. In accepting employment by Employer, Employee shall
undertake and assume the responsibility of performing for and on behalf of
Employer the duties of a Vice-President of the Employer and/or such other duties
as may be assigned to Employee by Employer at any time and from time to time,
including but not limited to duties of assisting Employer with the formation of
a bank to be wholly owned by Employer and located in Barnwell, South Carolina.
Notwithstanding the forgoing, except with Employee's written consent, Employee
shall not be permanently assigned to any position of lower professional status.
B. During the term of this Agreement, Employee shall be a
full-time employee of Employer or a wholly owned subsidiary of Employer, and
shall devote Employee's full working time and efforts to Employee's duties
hereunder. Employee shall perform all of Employee's duties hereunder to the best
of Employee's ability and shall not, directly or indirectly, engage or
participate in any activities in conflict with the best interests of Employer,
and will conduct all of Employee's activities in strict loyalty to Employer.
Without limiting the generality of the foregoing, Employee shall not engage in
any activity for compensation or pecuniary gain other than Employee's employment
hereunder and passive investing for the account of Employee or members of
Employee's household.
1
4. Compensation. As compensation for the services to be rendered by
Employee for Employer under this Agreement, Employee shall be compensated as
follows:
A. Base Salary.
(1) Until a licensed bank that is wholly
owned by Employer lawfully commences business in Barnwell, South Carolina,
Employee shall be compensated by Employer on the basis of an annual salary of
Seventy-Five Thousand and No/100 ($75,000.00) Dollars. Such salary shall be
payable in pay periods as determined by the Employer, but in no event less
frequently than monthly.
(2) Upon the lawful commencement of business
in Barnwell, South Carolina of a licensed bank that is wholly owned by Employer,
Employer's obligations under Section 4(A)(1) above shall cease, and Employee
shall be compensated by Employer on the basis of an annual salary of
Seventy-Five Thousand and No/100 ($75,000.00) Dollars; provided however, that
payment of such salary to Employee by Employer shall be reduced dollar for
dollar by the amount of salary and/or wages, if any, paid by such bank to
Employee during the initial term of this Agreement; and provided further that
the amount of such Base Salary payable by such bank pursuant to this Section
4(A)(2) is hereby guaranteed by Employer for the balance of the initial two year
term of this Agreement. Such salary shall be payable in pay periods as
determined by Employer or such bank, but in no event less frequently than
monthly.
B. Dues. Employer shall pay all dues of Employee as a member
of one social club and one service club, both of which shall be approved by the
parties hereto.
C. Vacation. Employer shall provide fifteen (15) business days
of paid vacation time each calendar year. Such vacation days are to be taken at
such time or times as Employee may reasonably request, subject to the Employer's
convenience and prior approval, which approval shall not be unreasonably
withheld. Vacation time shall not cumulate year to year.
D. Automobile Provision. Employer shall provide Employee with
the use of an automobile with a purchase price of not less than Twenty Thousand
and No/100 ($20,000) Dollars.
E. Reimbursement For Expenses. Employer shall provide
reimbursement of all pre-approved reasonable expenses incurred by Employee for
the benefit of Employer in the performance of Employee's duties hereunder.
F. Other Benefits. The Employer shall provide other benefits
(e.g., health insurance coverage, dental insurance coverage, life insurance,
disability insurance, participation in pension plans, and paid leave, etc.)
reasonably comparable to, and no less favorable to Employee than, those
benefits, if any, generally provided to other senior executives of Employer or
any bank owned by Employer.
Other than as set forth in Section 10 hereof, the compensation stated
above is intended to be the total compensation paid to Employee.
2
5. Confidentiality and Secrecy. Employee acknowledges that in and as a
result of Employee's employment hereunder, Employee will be making use of,
acquiring, and/or adding to confidential information of a special and unique
nature and value relating to Employer's business, including without limitation
technological knowhow, copyrights, proprietary information, trade secrets,
systems, procedures, manuals, confidential reports, records, operational
expertise, lists of customers and projects, the nature and type of services
rendered by Employer, the equipment and methods used and preferred by Employer's
customers, and the fees paid by them (all of which are deemed for all purposes
confidential and proprietary). As a material inducement to Employer to enter
into this Agreement and to pay to Employee the compensation stated in Section 4,
Employee covenants and agrees that during the term of Employee's employment
hereunder, and for one (1) year after the expiration or earlier termination of
Employee's employment by Employer or an affiliate of Employer, Employee shall
not, directly or indirectly, make use of, or disclose to any person, any
confidential information of Employer or its affiliates.
6. Covenants Against Competition. In view of the unique value to
Employer of the services of Employee for which Employer has contracted
hereunder, because of the confidential information to be obtained by or
disclosed to Employee, as hereinabove set forth, and because Employee's
employment hereunder will result in Employee's development of a unique
relationship with customers, suppliers and employees, as a material inducement
to Employer to enter into this Agreement and to pay to Employee the compensation
stated in Section 4, Employee covenants and agrees as follows:
A. During Employee's employment by Employer or an affiliate of
Employer, and for a period expiring on the earlier to occur of the date one (1)
year after the expiration of this Agreement or the date two (2) years after the
earlier termination for any reason of Employee's employment by Employer,
Employee shall not directly or indirectly solicit or divert employment of any
employee of the business of Employer or an affiliate of Employer, or employ any
person previously employed by Employer or an affiliate of Employer.
B. During Employee's employment by Employer or an affiliate of
Employer, and for a period expiring on the earlier to occur of the date one (1)
year after the expiration of this Agreement or the date two (2) years after the
earlier termination for any reason of Employee's employment by Employer,
Employee shall not directly or indirectly solicit, divert or convert, or assist
another person or entity to solicit, divert or convert, customers of Employer or
an affiliate of Employer to any other company or entity providing substantially
the same or competitive services or products as Employer or an affiliate of
Employer.
C. During Employee's employment by Employer or an affiliate of
Employer, and for a period expiring on the earlier to occur of the date one (1)
year after the expiration of this Agreement or the date two (2) years after the
earlier termination of Employee's employment by Employer for any reason other
than Employer's termination of Employee "without cause" pursuant to Section 8(B)
hereof, Employee shall not within the geographic area specified below engage in
any business or perform any services, directly or indirectly, in competition
with the business of Employer or any subsidiary of Employer, or have any
interest, whether as a proprietor, partner, employee, stockholder (directly or
beneficially), principal, agent, consultant, director, officer, or in any other
capacity or manner whatsoever, in any enterprise that shall so
3
engage; except that Employee shall be permitted to own for investment purposes
only, directly or beneficially, up to (but not more than) 2% in the aggregate of
the stock of a competing corporation which is publicly-traded on a national
stock exchange or the Nasdaq National Market System, so long as Employee is not
a controlling person of, or a member of a group that controls, such corporation
and Employee is not otherwise affiliated in any capacity with such corporation.
The restrictions of this Section 6(C) shall apply everywhere within a 25 mile
radius of each location where Employer (or any subsidiary of Employer) maintains
an office or branch at any time during the term of this Agreement.
7. Reasonableness, Enforceability and Remedies.
A. Employee has carefully read and considered the provisions
of Sections 5, 6, and 7, and, having done so, agrees that the restrictions set
forth in these Sections, including, but not limited to, the time period of
restriction and geographic limitations set forth in Section 6, are fair and
reasonable and are reasonably required for the protection of the interests of
Employer and its officers, directors, shareholders, employees, and affiliates.
B. In the event that, notwithstanding the foregoing, any of
the provisions of Sections 5, 6, or 7 or any parts thereof shall be held to be
invalid or unenforceable, the remaining provisions or parts thereof shall
nevertheless continue to be valid and enforceable as though the invalid or
unenforceable portions or parts had not been included therein. In the event that
any provision of Sections 5 or 6 relating to the time period and/or geographic
restrictions and/or related aspects shall be declared by a court of competent
jurisdiction to exceed the maximum restrictiveness such court deems reasonable
and enforceable, the time period and/or geographic restrictions and/or related
aspects deemed reasonable and enforceable by the court shall become and
thereafter be the maximum restriction in such regard, and the restriction shall
remain enforceable to the fullest extent deemed reasonable by such court.
C. Employee acknowledges that the services Employee is to
render are of a special and unusual character with a unique value to Employer,
the loss of which cannot adequately be compensated by damages in an action at
law. In the event of a breach or threatened breach by Employee of any of the
provisions of Sections 5 or 6, Employer, in addition to and not in limitation
of, any other rights, remedies, or damages available to Employer under this
Agreement, shall be entitled to a permanent injunction in order to prevent or
restrain any such breach by Employee or by Employee's partners, agents,
representatives, servants, employers, employees, consulting clients, and/or any
and all persons directly or indirectly acting for or with Employee.
D. Employee covenants and agrees that if Employee shall
violate any of Employee's covenants or agreements under Sections 5 or 6,
Employer shall be entitled to: (i) an accounting and repayment of all profits,
compensation, commissions, remuneration, or other benefits that Employee
directly or indirectly has realized and/or may realize as a result of, growing
out of, or in connection with, any such violation; (ii) recover actual damages
incurred by Employer or its affiliates as a result of any such violation; (iii)
any injunctive relief to which Employer is or may be entitled at law, in equity,
or under this Agreement; and (iv) exercise its other rights respecting a breach
of this Agreement as set forth herein. The remedies set forth
4
herein shall not be the sole and exclusive remedies to which Employer is
entitled for violation of Sections 5 or 6.
E. Employee's obligations under Sections 5 and 6 shall survive
any termination of Employee's employment hereunder.
8. Termination
A. For Cause By Employer. Notwithstanding any other provision
hereof, Employer may terminate Employee's employment under this Agreement
immediately at any time for "cause." For purposes hereof the term "cause" shall
include, but not be limited to, the commission of any of the following by
Employee: dishonesty; theft; unethical business conduct; indictment for a
felony; indictment for a misdemeanor involving moral turpitude; drug or alcohol
addiction or abuse; incompetence in the performance of material duties on behalf
of Employer; violation of the terms and provisions of this Agreement; willful or
recurring insubordination; failure to attempt, in good faith, to comply with
reasonable instructions of Employer; material violation by Employee of any
federal or state banking law, rule or regulation; causing or permitting, whether
intentionally or negligently, Employer to materially violate any federal or
state banking law, rule or regulation; or if Employee is suspended and/or
temporarily prohibited from participating in the conduct of the affairs of
Employer or any subsidiary of Employer by notice served under Section 8(e) of
the Federal Deposit Insurance Act (12 U.S.C., Section 1818 (e)). All
compensation (including without limitation the Base Salary, and all perquisites
and fringe benefits) to which Employee would otherwise be entitled (for periods
after the effective date of such termination) shall be discontinued and
forfeited as of the effective date of such termination.
B. Without Cause By Employer. Employer may terminate this
Agreement "without cause" upon thirty (30) days prior written notice to
Employee. In the event of such termination, all compensation (including without
limitation the Base Salary and any perquisites and fringe benefits, if any) to
which Employee would otherwise be entitled (for periods after the effective date
of the termination) shall be discontinued and forfeited as of the effective date
of such termination. Notwithstanding the foregoing, in the event of such
termination by Employer without cause, the following shall occur:
(i) Employee shall be paid a cash lump sum severance
payment equal to the amount of the Base Salary as defined in Section 4(A) which
would be payable to Employee during the remaining initial term of this Agreement
if Employee's employment hereunder was not terminated pursuant to this Section
8(B);
(ii) Employee shall receive from Employer, at
Employer's expense, all benefits set forth in Section 4(F) until the expiration
of the initial term of this Agreement; provided however, during such period
should a third party provide any such benefit to Employee, Employer's obligation
pursuant to this paragraph to provide the fringe benefit provide by the third
party shall be reduced by the amount and to the extent such fringe benefit is
provided to Employee by such third party; and
5
(iii) Employee shall receive the title to the
automobile described in Section 4(D) hereof.
C. Termination By Employee. Employee may with or without cause
terminate this Agreement upon thirty (30) days prior written notice to Employer.
In the event of such termination, all compensation (including without limitation
the Base Salary, and all perquisites and fringe benefits) to which Employee
would otherwise be entitled (for periods after the effective date of such
termination) shall be discontinued and forfeited as of the effective date of
such termination. Employee's death shall be deemed termination of this Agreement
pursuant to this Section 8(C).
D. Disability. In the event of the Employee's disability
during employment under this Agreement, then employment under this Agreement
shall terminate. For purposes of this Agreement, except as provided hereinbelow,
"disability" shall mean the inability of Employee, due to sickness or other
incapacity, to perform Employee's duties under this Agreement for a period in
excess of ninety (90) substantially consecutive days. Such termination shall
become effective at Employer's election upon the expiration of such ninety (90)
day period of disability. Upon termination of employment under this Agreement
due to Employee's disability, all compensation (including without limitation the
Base Salary, and all perquisites and fringe benefits) to which Employee would
otherwise be entitled (for periods after the effective date of such termination)
shall be discontinued and forfeited as of the effective date of such
termination.
9. Annual Review. On or about each anniversary date of the date of this
Agreement, during the term of this Agreement, this Agreement, including the
compensation provisions of Section 4, shall be reviewed by the Employer and
Employee; provided, however, neither party shall have any obligation to modify
this Agreement, and no amendment or other modification hereof shall be effective
unless mutually agreed to by the parties in writing.
10. Grant of Stock Option. As a material inducement to Employee to
enter into this Agreement, Employer shall grant to Employee on the date of
Employee's commencement of employment hereunder (the "Granting Date"), pursuant
to that certain Incentive Stock Option Plan adopted by the Employer on May 16,
1994 (the "Plan"), a stock option to purchase pursuant to the terms of the Plan
a total of Fifteen Thousand (15,000) shares of Employer's capital stock (the
"Option Shares"). Subject to the terms and limitations set forth in this Section
10, on the Granting Date the Employer and Employee shall execute and deliver an
Incentive Stock Option Agreement in the form contemplated by the Plan. The
purchase price per Option Share shall be equal to Thirteen and No/100ths
($13.00) Dollars. Employee may not transfer or assign any right or interest in
the option in whole or in part.
11. Burden and Benefit. This Agreement shall be binding upon, and shall
inure to the benefit of, Employer and Employee, and their respective heirs,
personal and legal representatives, successors, and permitted assigns.
12. Assignment. This Agreement and any rights hereunder are personal to
Employee and shall not be assigned or otherwise transferred by Employee.
Employer shall be entitled to assign this Agreement to any corporation
controlled by Employer.
6
13. Governing Law/Jurisdiction. The construction and interpretation of
this Agreement shall at all times and in all respects be governed by the laws of
the State of South Carolina. The parties hereby (i) agree that any litigation,
action or proceeding arising out of or relating to this Agreement may be
instituted in a state or federal court in the State of South Carolina, (ii)
waives any objection which it might have now or hereafter to any such
litigation, action or proceeding based upon improper venue or inconvenient
forum, and (iii) irrevocably submits to the jurisdiction of such courts in any
such litigation, action or proceeding. For all purposes of this Agreement, the
parties hereby further agree that service of process upon any party may be
effected pursuant to United States mail.
14. Usage. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Term such as "hereof", "hereunder",
"hereto", "herein", and words of similar import shall refer to this Agreement in
its entirety and all references shall refer to specified portions of this
Agreement, unless the context clearly requires otherwise.
15. Severability. The provisions of this Agreement shall be deemed
severable, and the invalidity or unenforceability of any one or more of the
provisions of this Agreement shall not affect the validity and enforceability of
the other provisions. Without limiting the generality of the foregoing or of
Section 7, each provision, sub-provision, part, and sub-part of Sections 6 or 7
shall be deemed severable.
16. Survival. Employee's obligations pursuant to Section 5 and 6 hereof
shall survive the termination of this Agreement.
17. Modifications. This Agreement can only be modified by a written
agreement duly signed by authorized representatives of the parties hereto.
Moreover, in order to avoid uncertainty, ambiguity and misunderstandings in
their relationships, the parties hereto covenant and agree not to enter into any
oral agreement or understanding inconsistent or in conflict with this Agreement;
and the parties hereto further covenant and agree that any oral communication
allegedly or purportedly constituting such an agreement or understanding shall
be absolutely null, void and without effect.
18. Waiver. Any waiver by either party of any breach or any term or
condition hereof shall be effective only if in writing and such writing shall
not be deemed to be a waiver of any subsequent or other breach, term or
condition of this Agreement.
19. No Inference Against Author. No provision of this Agreement shall
be interpreted against any party because such party or its legal representative
drafted such provision.
20. Notice. Any notice, request, approval, consent, demand or other
communication hereunder shall be effective if in writing and upon the first to
occur of the following: (i) upon
7
receipt by the party to whom such notice, request, approval, consent, demand or
other communication is being given; or (ii) three (3) business days after being
duly deposited in the U.S. Mail, certified, return receipt requested, and
addressed as follows:
Employee: Xxxxxxxx X. Xxxxxx, Xx.
Employer: Community Capital Corporation
X.X. Xxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: President
The parties hereto may change their respective addresses by notice in writing
given to the other party this Agreement.
21. Entire Agreement. This Agreement contains the entire agreement and
understanding by and between Employer and Employee with respect to the subject
matter hereof and supersedes all prior and contemporaneous written or oral
agreements and representations between the parties with respect thereto.
IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement under seal to be effective as of the day and year first above written.
IN THE PRESENCE OF: EMPLOYEE:
(SEAL)
/s/ APRIL X. XXXXXXX /s/ XXXXXXXX X. XXXXXX, XX.
Witness Xxxxxxxx X. Xxxxxx, Xx.
/s/ XXXXX X. XXXXX
Witness
EMPLOYER:
COMMUNITY CAPITAL CORPORATION
/s/ APRIL X. XXXXXXX
Witness (SEAL)
By: /s/ XXXXXXX X. XXXXXXX
Its: President
/s/ XXXXX X. XXXXX
Witness
8
