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EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, effective the 1st day of January, 1996, is
made by and between PREMIER BANK OF EAST TENNESSEE (the "Bank"), XXXXXX COUNTY
BANCSHARES, INC. ("Bancshares") and XXXXXXX X. XXXXX, XX. (the "Executive").
WITNESSETH:
WHEREAS, Bancshares owns 100% of the outstanding common stock of the
Bank; and
WHEREAS, the Bank, Bancshares and the Executive desire to enter into
an employment relationship with the other; and
WHEREAS, the Bank and the Executive each deem it necessary and
desirable to execute a written document setting forth the terms and conditions
of said relationship.
NOW, THEREFORE, in consideration of the employment of the
Executive by the Bank, of the mutual covenants, promises and agreements herein
made, and of other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. EMPLOYMENT. The Bank hereby employs Executive's full-time
services as President, Chief Executive Officer and Director of Bank, for a term
of one year commencing on January 1, 1996 (the "Commencement Date"). Executive
hereby accepts such employment. This Employment Agreement shall automatically
be extended for additional one year terms one year from the Commencement Date
and annually thereafter, unless terminated by thirty (30) days advance written
notice given by either the Executive or the Bank. Executive shall diligently
perform the duties customarily performed by such officer, subject to the
authority of the Board of Directors (the "Board") of the Bank, and shall hold
and perform all of the responsibilities and duties prescribed by the Board and
by the Bylaws of the Bank. During the term of this Agreement, Executive will
devote his full time and effort to his duties hereunder, to the exclusion of
all other employment or business interests other than passive personal
investments, charitable, religious or civic activities.
2. BASE SALARY. As compensation for his services to the Bank,
the Bank agrees to pay Executive an annual salary of Seventy Five Thousand and
No/100 Dollars ($75,000.00) commencing on the Commencement Date (the Base
Salary"). The annual salary shall be paid according to the normal payroll
practices of the Bank for other employees. Effective one year from the
Commencement Date, Executive shall be paid such Base Salary, which shall not be
less than Seventy Five Thousand and No/100 Dollars, and compensation as the
Board of the Bank may recommend. Any such salary and compensation recommended
by the Board of the Bank must be ratified and approved by Xxxxxx County
Bancshares, Inc.
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Payment will be in accordance with the Bank's payroll policies in effect from
time to time. In addition Executive will receive the normal Bank Board fee for
attendance at board of directors and committee meetings.
3. BONUS.
(a) Employee shall be entitled to receive an additional annual
bonus compensation (the "Bonus") determined by the Executive and the
President of Xxxxxx County Bank after taking into consideration the
earnings and growth of the Bank. For the five consecutive years
following the Commencement Date, the Bonus shall amount to not less
than twenty percent (20%) of the Base Salary nor greater than
thirty-five percent (35%) of the Base Salary.
(b) In addition, the Bank, in its discretion, may, with respect
to any year during the term hereof, award a bonus or bonuses to the
Executive in addition to the Bonus provided for in Section 3(a). The
compensation provided for in this Section and Section 3(a) shall be
in addition to any pension or profit sharing payments set aside or
allocated for the benefit of the Executive.
4. BENEFITS. The Bank agrees to provide Executive with the
following benefits, commencing with the Commencement Date, or as soon
thereafter as practicable, and continuing for so long as Executive is employed
under this Employment Agreement or any extension thereof:
(a) An insurance program (or similar programs) which is maintained
for all Bank personnel. In addition, the Bank shall provide major
medical, hospitalization, disability and dental insurance paid
consistent with normal practices for executive employees for the
benefit of the Executive and Executive's dependents.
(b) An annual paid vacation according to normal policies of the
Bank for senior executives.
(c) Use of a six-passenger sedan automobile including all
operating and maintenance expenses.
(d) Reimbursement of monthly dues and Bank-related expenses of
Executive at Springbrook Country Club.
(e) Participation in the Bank's 401-K Plan;
(f) Other benefits as the Board may approve from time to time.
5. INVESTMENT IN STOCK OF BANCSHARES. Bancshares and the
Executive agree and acknowledge that upon the date of this Employment
Agreement, Executive shall
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immediately become a fully vested participant in the existing Xxxxxx County
Bancshares, Inc. Senior Management Stock Option Plan.
6. EXPENSES. Executive is authorized to incur necessary and
customary expenses in connection with the business of the Bank, including
expenses for entertainment, trade association meetings, travel, promotion and
similar matters. The Bank will pay or reimburse Executive, pursuant to Bank
policy, for such expenses upon presentation by Executive of the appropriate
records which verify such expenses.
7. TERMINATION. This Agreement shall terminate upon the first
to occur of the following:
(a) The death of Executive;
(b) Termination by Bank "for cause," as defined in paragraph 8;
(c) Termination by Executive; provided, that Executive shall give
not less than thirty (30) days' written notice of termination. Upon
receipt of notice of intended termination given by Executive, the
Bank reserves the right to terminate the Executive's employment
effective immediately, provided that in such instance, the Bank shall
pay an amount equal to Executive's Base Salary due for the remainder
of the thirty (30) day notice period to the termination date, or
thirty (30) days, whichever is less.
In the event of termination for any cause outlined in 8(a) through
(c), no severance or other payment shall be made to Executive; however, nothing
contained in this paragraph 8 shall be construed to abrogate the obligations to
Executive, or his personal representative, or his heirs, as the case may be, in
respect to all rights which shall accrue prior to termination.
8. TERMINATION FOR CAUSE. As used in paragraph 8(c), termination
"for cause" shall include acts of dishonesty; conviction of a felony; breach of
this Agreement by Executive; or willful or gross negligence in carrying out the
activities for which employed. "For cause" is not intended to include
disagreements over management philosophy or other such intangibles.
9. DISCLOSURE OF CONFIDENTIAL INFORMATION. Executive
acknowledges that the Bank possesses certain methods of operation and
information concerning its business affairs, including customer lists and other
customer information, which are valuable, special and unique assets of its
business. Without prior Board approval, Executive agrees not to disclose,
during or after the term of his employment, any such information, or any part
thereof to any bank, person, firm, corporation, association or other entity for
any reason or purpose whatsoever.
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10. NON-INTERFERENCE WITH PERSONNEL RELATIONS. Except for
Executive's personal executive secretary, Executive shall not, directly or
indirectly, during his employment and for a period of twenty-four (24) months
immediately following the termination of his employment with the Bank,
knowingly solicit, entice or persuade any other employees or agents of the Bank
to leave the services of the Bank to engage in the business of providing
banking or investment banking services for any corporation, partnership,
association trust or other entity or person carrying on business in XxXxxx
County, Tennessee.
11. ASSIGNMENT. The rights and obligations of the Bank and
Executive (except the Executive's obligation to perform services) under this
Agreement shall inure to the benefit of and shall be binding upon their
respective successors, if any. The rights and obligations of Executive under
this Agreement shall inure only to the benefit of Executive, are not
assignable by Executive to any other person or entity by virtue of the unique
and personal nature of Executive's services.
12. ENTIRE AGREEMENT. Except for the Employment Agreement with
Xxxxxx County Bancshares, Inc. and Noncompetition Agreement executed
contemporaneously herewith, this Agreement contains the entire agreement
between the parties and supersedes all prior discussion, understanding and
commitments, whether oral or written. This Agreement cannot be amended or
modified except by subsequent written agreement signed by all parties hereto.
13. ATTORNEYS' FEES AND COSTS. If an action at law or in equity
is necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorneys' fees, costs and
necessary disbursements in addition to any other relief to which he may be
entitled.
14. CONTROLLING LAW. This Agreement is being executed in and will
be performed in the State of Tennessee and shall be construed, controlled and
interpreted according to the laws of Tennessee.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
PREMIER BANK OF EAST TENNESSEE
By: /s/ Xxxxxxx X. Xxxxx, Xx.
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Its: Chairman
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EXECUTIVE:
/s/ Xxxxxxx X. Xxxxx, Xx.
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XXXXXXX X. XXXXX, XX.
XXXXXX COUNTY BANCSHARES
By: /s/ Xxxx Xxxxxxx
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Its: President
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