EMPLOYMENT AGREEMENT JOHN S. FITZGERALD
XXXX
X. XXXXXXXXXX
This
Agreement is made effective as of the 1st day of November, 2007 by and between
Magyar Bancorp, Inc., a Delaware corporation (the “Company”), with its principal
administrative office at 000 Xxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxx Xxxxxx 00000,
and Xxxx X. Xxxxxxxxxx (“Executive”).
WHEREAS,
Executive is currently employed as the Executive Vice President and Chief
Operating Officer of the Company and Magyar Bank, a New Jersey chartered stock
savings bank and a wholly owned subsidiary of the Company (the
“Bank”); and
WHEREAS,
in consideration of Executive’s outstanding service to the Company and the Bank,
the Company desires to provide further incentive to Executive to achieve
corporate objectives and to remain in the employ of the Bank by providing him
with this employment agreement in place of the change in control agreement
previously entered into between the Company and the Bank.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants
and conditions hereinafter set forth, the Company and Executive hereby agree
as
follows:
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1.
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POSITION
AND RESPONSIBILITIES
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During
the period of his employment hereunder, Executive agrees to serve as Executive
Vice President and Chief Operating Officer of the Company and the
Bank. The Executive shall serve under the direction of the President
and Chief Executive Officer and the Board of Directors, and shall report
directly to the President and Chief Executive Officer. During said period,
Executive also agrees to serve, if elected, as an officer and director of any
subsidiary or affiliate of the Company.
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2.
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TERM
AND DUTIES
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(a) The
period of Executive’s employment under this Agreement shall begin as of the date
first above written and shall continue for thirty-six (36) full calendar months
thereafter. Commencing December 31, 2007, and continuing December
31st of each
year thereafter (the “Anniversary Date”), this Agreement shall renew for an
additional period such that the remaining term shall be thirty-six months,
unless written notice of non-renewal (“Non-Renewal Notice”) is provided to
Executive at least thirty (30) days prior to any such Anniversary Date, in
which
event this Agreement shall terminate at the end of thirty-six (36) months
following such Anniversary Date. Prior to each notice period
for non-renewal, the disinterested members of the Board of Directors of the
Company (“Board”) will conduct a comprehensive performance evaluation and review
of Executive for purposes of determining whether to provide Non-Renewal Notice,
and the results thereof shall be included in the minutes of the Board’s
meeting.
(b) During
the period of his employment hereunder, except for periods of absence occasioned
by illness, reasonable vacation periods, and reasonable leaves of absence,
Executive shall faithfully perform his duties hereunder including activities
and
services related to the organization, operation and management of the
Company.
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3.
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COMPENSATION
AND REIMBURSEMENT
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(a) The
compensation specified under this Agreement shall constitute the salary and
benefits paid for the position, responsibilities and duties described in
Sections 1 and 2. In consideration of the services to be rendered by
Executive hereunder, the Company and/or the Bank shall pay Executive as
compensation a salary of not less than One Hundred Seventy-five Thousand dollars
($175,000) per year (“Base Salary”). Such Base Salary shall be
payable bi-weekly, or in accordance with the Bank’s normal payroll
practices. During the period of this Agreement, Executive’s Base
Salary shall be reviewed at least annually; the first such review will be made
no later than December 31 of each year during the term of this
Agreement. Such review shall be conducted by the Board of Directors
of the Company and/or the Bank (the “Board”) (or a committee thereof), and the
Board may increase, but not decrease, Executive’s Base Salary (any increase in
Base Salary shall become the “Base Salary” for purposes of this
Agreement). In addition to the Base Salary provided in this Section
3(a), the Company and/or its subsidiaries shall provide Executive at no cost
to
Executive with all such other benefits as are provided uniformly to permanent
full-time employees of the Company and/or its subsidiaries.
(b) The
Company and/or its subsidiaries will provide Executive with employee benefit
plans, arrangements and perquisites substantially equivalent to those in which
Executive was participating or otherwise deriving benefit from immediately
prior
to the beginning of the term of this Agreement, and the Company and/or its
subsidiaries will not, without Executive’s prior written consent, make any
changes in such plans, arrangements or perquisites which would adversely affect
Executive’s rights or benefits thereunder, unless such change is applicable to
all similarly situated employees. Nothing paid to Executive under any
such plan or arrangement will be deemed to be in lieu of other compensation
to
which Executive is entitled under this Agreement.
(c) In
addition to the Base Salary provided for by Section 3(a), the Company and/or
its
subsidiaries shall pay or reimburse Executive for all reasonable travel and
other reasonable expenses incurred by Executive in performing his obligations
under this Agreement and may provide such additional compensation in such form
and such amounts as the Board may from time to time determine.
4. OUTSIDE
ACTIVITIES
Executive
may serve as a member of the board of directors of business, community and
charitable organizations subject to the approval of the Board, provided that
in
each case such service shall not materially interfere with the performance
of
his duties under this Agreement or present any conflict of
interest.
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5.
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WORKING
FACILITIES AND EXPENSES
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Executive’s
principal place of employment shall be the Company’s principal executive
offices. The Company shall provide Executive, at his principal place
of employment, with a private office and other support services and facilities
suitable to his position with the Company and necessary or appropriate in
connection with the performance of his duties under this
Agreement. The Company and/or its subsidiaries shall pay Executive a
monthly automobile allowance of no less than $400. The Company and/or its
subsidiaries shall reimburse Executive for his ordinary and necessary business
expenses incurred in connection with the performance of his duties under this
Agreement, including, without limitation, fees for memberships in such clubs
(including the Forsgate Country Club) and organizations (such as the Risk
Management Association) that Executive and the Board mutually agree are
necessary and appropriate to further the business of the Company, and travel
and
reasonable entertainment expenses. Reimbursement of such expenses
shall be made upon presentation of an itemized account of the expenses in such
form as the Company and/or its subsidiaries may reasonably require.
6. PAYMENTS
TO EXECUTIVE UPON AN EVENT OF TERMINATION
(a) The
provisions of this Section 6 shall apply upon the occurrence of an Event of
Termination (as herein defined) during Executive’s term of employment under this
Agreement. As used in this Agreement, an “Event of Termination” shall
mean and include any one or more of the following:
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(i)
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the
involuntary termination by the Company or the Bank of Executive’s
full-time employment hereunder for any reason other than termination
for
Cause (as defined in Section 8 below), or termination for Disability
or
Retirement (as defined in Section 7 below);
or
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(ii) Executive’s
resignation from the Bank’s employ, upon any
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(A)
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failure
to elect or reelect or to appoint or reappoint Executive as Executive
Vice
President and Chief Operating
Officer,
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(B)
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material
change in Executive’s functions, duties, or responsibilities, which change
would cause Executive’s position to become one of lesser responsibility,
importance, or scope from the position and attributes thereof described
in
Section 1, above, or
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(C)
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material
breach of this Agreement by the
Company.
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Upon
the
occurrence of any event described in clauses (ii) (A) through (C) above (“Good
Reason”), Executive shall have the right to elect to voluntarily terminate his
employment under this Agreement, provided that, within 90 days of the initial
existence of the condition serving as the basis for the voluntary termination
for Good Reason, Executive gives the Company written notice of the condition,
and provided further that the Company has at least 30 days to remedy the
condition.
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(iii)
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The
involuntary termination of Executive’s employment by the Company or the
Bank, at any time following a Change in Control during the term of
this
Agreement. For these purposes, a Change in Control shall mean a
change in control of a nature that: (i) would be required to be reported
in response to Item 5.01 of the current report on Form 8-K, as in
effect
on the date hereof, pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (the “Exchange Act”); or (ii) results in a Change in
Control of the Bank or the Company within the meaning of the Bank
Holding
Company Act, as amended, and applicable rules and regulations promulgated
thereunder (collectively, the “BHCA”) as in effect at the time of the
Change in Control; or (iii) without limitation such a Change in Control
shall be deemed to have occurred at such time as (a) any “person” (as the
term is used in Sections 13(d) and 14(d) of the Exchange Act) is
or
becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of Company’s
outstanding securities, except for any securities purchased by the
Bank’s
employee stock ownership plan or trust; or (b) individuals who constitute
the Board on the date hereof (the “Incumbent Board”) cease for any reason
to constitute at least a majority thereof, provided that any
person becoming a director subsequent to the date hereof whose election
was approved by a vote of at least three-quarters of the directors
comprising the Incumbent Board, or whose nomination for election
by the
Company’s stockholders was approved by the same Nominating Committee
serving under an Incumbent Board, shall be, for purposes of this
clause
(b), considered as though he were a member of the Incumbent Board;
or (c)
a plan of reorganization, merger, consolidation, sale of all or
substantially all the assets of the Bank or the Company or similar
transaction in which the Bank or Company is not the surviving institution
occurs or is implemented; or (d) a proxy statement soliciting proxies
from
stockholders of the Company is distributed, by someone other than
the
current management of the Company, seeking stockholder approval of
a plan
of reorganization, merger or consolidation of the Company or similar
transaction with one or more corporations as a result of which the
outstanding shares of the class of securities then subject to the
plan are
exchanged for or converted into cash or property or securities not
issued
by the Company; or (e) a tender offer is made for 25% or more of
the
voting securities of the Company and the shareholders owning beneficially
or of record 25% or more of the outstanding securities of the Company
have
tendered or offered to sell their shares pursuant to such tender
offer and
such tendered shares have been accepted by the tender
offeror. Notwithstanding anything in this subsection to the
contrary, a Change in Control shall not be deemed to have occurred
upon
the conversion of the Company’s mutual holding company parent to stock
form, or in connection with any reorganization used to effect such a
conversion.
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(b) Upon
the occurrence of an Event of Termination, as defined in Section 6(a)(i) or
(ii), on the Date of Termination, as defined in Section 9(b), the Company and/or
its subsidiaries shall pay Executive, or, in the event of his death subsequent
to an Event of Termination, his beneficiary or beneficiaries, or his estate,
as
the case may be, as severance pay or liquidated damages, or both, an amount
equal to two (2) times Executive’s Base Salary. Upon the occurrence
of an Event of Termination, as defined in Section 6(a)(iii), on the Date of
Termination, the Company and/or its subsidiaries shall pay Executive, or, in
the
event of his death subsequent to the Event of Termination, his beneficiary
or
beneficiaries, or his estate, as the case may be, as severance pay or liquidated
damages, or both, a sum equal to two (2) times the sum of (i) Executive’s Base
Salary, plus (ii) any earned and accrued but unpaid Bonus for the year of
Termination Payments hereunder shall be made in a lump sum
within thirty (30) days of the Date of Termination, provided, however, if
Executive is a “Specified Employee” under Section 409A of the Internal Revenue
Code (“Code”), such payment shall be made on the first day of the seventh full
month) following Executive’s “separation from service,” as such term is defined
in Code Section 409A.
(c) Upon
the occurrence of an Event of Termination, as defined in Section 6(a)(i),
6(a)(ii) or 6(a)(iii), the Company will cause to be continued, at Company’s sole
expense, life insurance coverage and non-taxable medical and dental insurance
coverage substantially identical to the coverage maintained by the Company
and/or the Bank for Executive prior to his termination. Such coverage or
payment shall continue for twenty-four (24) months from the Date of
Termination and shall count as “COBRA” coverage.
(d) Notwithstanding
the preceding paragraphs of this Section 6, in no event shall the aggregate
payments or benefits to be made or afforded to the Executive under said
paragraphs (the “Termination Benefits”) constitute an “excess parachute payment”
under Section 280G of the Code or any successor thereto, and in order to avoid
such a result, Termination Benefits will be reduced, if necessary, to an amount
(the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less
than an amount equal to three (3) times the Executive’s “base amount”, as
determined in accordance with said Section 280G. The allocation of
the reduction required hereby among Termination Benefits provided by the
preceding paragraphs of this Section 6 shall be determined by the
Executive.
7. TERMINATION
UPON RETIREMENT, DISABILITY OR DEATH
(a) For
purposes of this Agreement, termination by the Company or the Bank of
Executive’s employment based on “Retirement” shall mean termination of
Executive’s employment by the Company or the Bank upon attainment of age 65, or
such later date as determined by the Board. Upon termination of Executive’s
employment upon Retirement, Executive shall be entitled to all benefits under
any retirement plan of the Company or Bank and other plans to which Executive
is
a party, but he shall not be entitled to the Termination Benefits specified
in
Section 6(b) through (c) hereof.
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(b) The
Company may terminate this Agreement if Executive becomes “Disabled” (as defined
in the next sentence). In such event, the Executive shall receive the
greater of (i) his net after-tax Base Salary for the remaining term of the
Agreement, or one year, whichever is the longer period of time; or (ii)
disability insurance benefits provided by the Company, plus any applicable
xxxxxxx’x or social security disability benefits to which Executive is entitled,
with the understanding that the amount of any such disability benefits shall
offset the Company’s obligation to pay Executive his Base
Salary. “Disabled” shall mean that Executive is (A) unable to engage
in any substantial gainful activity by reason of any medically determinable
physical or mental impairment that can be expected to result in death or can
be
expected to last for a continuous period of not less than 12 months or (B)
determined to be totally disabled by the Social Security
Administration. If Executive is Disabled, the Date of Termination
shall be the date that the Company provides a Notice of Termination to
Executive. Disability benefits as described in this paragraph shall
be provided to Executive starting on such Date of Termination.
8. TERMINATION
FOR CAUSE
In
the
event that employment hereunder is terminated by the Company for Cause, the
Executive shall not be entitled to receive compensation or other benefits for
any period after such termination, except as provided by law. The
phrase “Cause” as used herein, shall exist when there has been a good faith
determination by the Company, as communicated to Executive by the Chief
Executive Officer, that there shall have occurred one or more of the following
events with respect to the Executive: (i) the conviction of the Executive of
a
felony or of any lesser criminal offense involving moral turpitude; (ii) the
willful commission by the Executive of a criminal or other act that, in the
judgment of the Board will likely cause substantial economic damage to the
Company or the Bank or substantial injury to the business reputation of the
Company or Bank; (iii) the commission by the Executive of an act of fraud in
the
performance of his duties on behalf of the Company or Bank; (iv) the continuing
willful failure of the Executive to perform his duties to the Company or Bank
(other than any such failure resulting from the Executive’s incapacity due to
Disability) after written notice thereof (specifying the particulars thereof
in
reasonable detail) and a reasonable opportunity to be heard and cure such
failure are given to the Executive; or (v) an order of a federal or state
regulatory agency or a court of competent jurisdiction requiring the termination
of the Executive’s employment by the Company. Notwithstanding the
foregoing, Cause shall not be deemed to exist unless there shall have been
delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the entire membership of the
Board at a meeting of the Board called and held for the purpose (after
reasonable notice to the Executive and an opportunity for the Executive to
be
heard before the Board), finding that in the good faith opinion of the Board
the
Executive was guilty of conduct described above and specifying the particulars
thereof. Prior to holding a meeting at which the Board is to make a
final determination whether Cause exists, if the Board determines in good faith
at a meeting of the Board, by not less than a majority of its entire membership,
that there is probable cause for it to find that the Executive was guilty of
conduct constituting Cause as described above, the Board may suspend the
Executive from his duties hereunder for a reasonable period of time not to
exceed fourteen (14) days pending a further meeting at which the
Executive shall be given the opportunity to be heard before the
Board.
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For
purposes of this subparagraph, no act or failure to act, on the Executive’s part
shall be considered “willful” unless done, or omitted to be done, by him not in
good faith without reasonable belief that his action or omission was in the
best
interest of the Company and the Bank. Upon a finding of Cause, the
Board shall deliver to the Executive a Notice of Termination, as more fully
described in Section 9 below.
9. NOTICE
(a) Any
purported termination by the Company or by Executive shall be communicated
by
Notice of Termination to the other party hereto. For purposes of this
Agreement, a “Notice of Termination” shall mean a written notice which shall
indicate the specific termination provision in this Agreement relied upon and
shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive’s employment under the provision so
indicated.
(b) Date
of Termination” shall mean (A) if Executive’s employment is terminated for
Disability, thirty (30) days after a Notice of Termination is given (provided
that he shall not have returned to the performance of his duties on a full-time
basis during such thirty (30) day period), and (B) if his employment is
terminated for any other reason, the date specified in the Notice of Termination
(which, except in the case of a termination for Cause, shall not be less than
thirty (30) days from the date such Notice of Termination is
given). In the event of termination for Cause, termination shall be
immediate upon the receipt of a Notice of Termination.
(c) If,
within thirty (30) days after any Notice of Termination is given, the party
receiving such Notice of Termination notifies the other party in writing that
a
dispute exists concerning the termination (“Notice of Dispute”), the Date of
Termination shall be the date on which the dispute is finally determined, either
by mutual written agreement of the parties, by a binding arbitration award,
or
by a final judgment, order or decree of a court of competent jurisdiction (the
time for appeal having expired and no appeal having been perfected) and provided
further that the Date of Termination shall be extended by a Notice of Dispute
only if the Notice of Dispute is given in good faith and the party giving the
Notice of Dispute pursues the resolution of such dispute with reasonable
diligence. Notwithstanding the pendency of any such dispute, except
in the event of termination for Cause, the Company will continue to pay
Executive his full compensation in effect when the Notice of Dispute was given
(including, but not limited to, Base Salary) and continue Executive as a
participant in all compensation, benefit and insurance plans in which he was
participating when the Notice of Dispute was given, until the dispute is finally
resolved in accordance with this Agreement, provided such dispute is resolved
within the term of this Agreement. If such dispute is not resolved
within the term of the Agreement, the Company shall not be obligated, upon
final
resolution of such dispute, to pay Executive compensation and other payments
accruing beyond the term of the Agreement. Amounts paid under this Section
following Notice of Termination shall be offset against or reduce any other
amounts due under this Agreement.
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(d) The
dispute provisions of Section 9(c) shall not apply in the event of Executive’s
voluntary termination for Good Reason. If Executive voluntarily
terminates employment for Good Reason, then the Date of Termination shall be
the
date specified in the Notice of Termination.
10. POST-TERMINATION
OBLIGATIONS
Executive
shall furnish such information and assistance to the Company and the Bank as
may
reasonably be required by the Company, in connection with any litigation in
which it or any of its subsidiaries or affiliates is, or may become, a party;
provided, however, that Executive shall not be required to provide information
or assistance with respect to any litigation between the Executive and the
Company or any of its subsidiaries or affiliates.
11. NON-COMPETITION
(a) Executive
hereby covenants and agrees that, for a period of one year following any
termination of employment with the Company or bank, he shall not, without the
written consent of the Company, either directly or indirectly:
(i) solicit,
offer employment to, or take any other action intended (or that a reasonable
person acting in like circumstances would expect) to have the effect of causing
any officer or employee of the Bank or the Company, or any of their respective
subsidiaries or affiliates, to terminate his or her employment and accept
employment or become affiliated with, or provide services for compensation
in
any capacity whatsoever to, any business whatsoever that competes with the
business of the Bank or the Company, or any of their direct or indirect
subsidiaries or affiliates, or which has headquarters or offices within
twenty-five (25) miles of the locations in which the Bank or the Company has
business operations or has filed an application for regulatory approval to
establish an office;
(ii) become
an officer, employee, consultant, director, independent contractor, agent,
sole
proprietor, joint venturer, greater than 5% equity owner or stockholder, partner
or trustee
of any savings bank, savings and loan association, savings and loan holding
company, credit union, bank or bank holding company, insurance company or
agency, any mortgage or loan broker or any other entity competing with the
Bank
or the Company or their affiliates in the same geographic locations where the
Bank, Company or their affiliates or which has headquarters or offices within
twenty-five (25) miles of the locations in which the Bank or the Company has
business operations or has filed an application for regulatory approval to
establish an office; provided, however, that this restriction
(11(a)(ii)) shall not apply if Executive’s employment is terminated following a
Change in Control; or
(iii) solicit,
provide any information, advice or recommendation or take any other action
intended (or that a reasonable person acting in like circumstances would expect)
to have the effect of causing any customer of the Company or the Bank to
terminate an existing business or commercial relationship with the Company
or
the Bank.
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(b) Executive
recognizes and acknowledges that the knowledge of the business activities and
plans for business activities of the Company and affiliates thereof, as it
may
exist from time to time, is a valuable, special and unique asset of the business
of the Company. Executive will not, during or after the term of his
employment, disclose any knowledge of the past, present, planned or considered
business activities of the Company, the Bank or their affiliates to any person,
firm, corporation, or other entity for any reason or purpose whatsoever (except
for such disclosure as may be required to be provided to any federal banking
agency with jurisdiction over the Company, the Bank or
Executive). Notwithstanding the foregoing, Executive may disclose any
knowledge of banking, financial and/or economic principles, concepts or ideas
which are not solely and exclusively derived from the business plans and
activities of the Company and the Bank, and Executive may disclose any
information regarding the Bank or the Company which is otherwise publicly
available.
(a) (c) All
payments and benefits to Executive under this Agreement shall be subject to
Executive’s compliance with this Section 11. The parties hereto,
recognizing that irreparable injury will result to the Company, the Bank, their
business and property in the event of Executive’s breach of this Section 11,
agree that, in the event of any such breach by Executive, the Company and the
Bank will be entitled, in addition to any other remedies and damages available,
to an injunction to restrain the violation hereof by Executive and all persons
acting for or with Executive. Executive represents and admits that Executive’s
experience and capabilities are such that Executive can obtain employment in
a
business engaged in other lines and/or of a different nature than the Company
and the Bank, and that the enforcement of a remedy by way of injunction will
not
prevent Executive from earning a livelihood. Nothing herein will be
construed as prohibiting the Bank or the Company from pursuing any other
remedies available to them for such breach or threatened breach, including
the
recovery of damages from Executive.
12. SOURCE
OF PAYMENTS; NO DUPLICATION OF PAYMENTS
Payments
pursuant to this Agreement shall be paid by the Company and/or the Bank. To
the
extent that payments and benefits, as provided by this Agreement, are paid
to or
received by Executive from the Bank, such compensation payments and benefits
paid by the Bank will satisfy the obligation for such payment and benefits
under
this Agreement.
13. NO
EFFECT ON EMPLOYEE BENEFITS PLANS OR PROGRAMS
The
termination of Executive’s employment during the term of this Agreement or
thereafter, whether by the Company or by Executive, shall have no effect on
the
vested rights of Executive under the Company’s or the Bank’s qualified or
non-qualified retirement, pension, savings, thrift, profit-sharing or stock
bonus plans, group life, health (including hospitalization, medical and major
medical), dental, accident and long term disability insurance plans, or other
employee benefit plans or programs, or compensation plans or programs in which
Executive was a participant.
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14. REQUIRED
REGULATORY PROVISIONS
(a) Notwithstanding
anything herein contained to the contrary, any payments to Executive by the
Company, whether pursuant to this Agreement or otherwise, are subject to and
conditioned upon their compliance with Section 18(k) of the Federal Deposit
Insurance Act, 12 U.S.C. Section 1828(k), and the regulations promulgated
thereunder in 12 C.F.R. Part 359.
(b) The
Company may terminate the Executive’s employment at any time and for any reason,
but any termination by the Company, other than termination for Cause, shall
not
prejudice Executive’s right to compensation or other benefits under this
Agreement.
15. NO
ATTACHMENT
(a) Except
as required by law, no right to receive payments under this Agreement shall
be
subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge, or hypothecation, or to execution, attachment, levy, or similar
process or assignment by operation of law, and any attempt, voluntary or
involuntary, to affect any such action shall be null, void, and of no
effect.
(b) This
Agreement shall be binding upon, and inure to the benefit of, Executive and
the
Bank and their respective successors and assigns.
16. ENTIRE
AGREEMENT; MODIFICATION AND WAIVER
(a) This
instrument contains the entire agreement of the parties relating to the subject
matter hereof, and supercedes in its entirety any and all prior agreements,
understandings or representations relating to the subject matter hereof
(including the Change in Control Agreement between the Company and the Executive
dated January 24, 2006). No modifications of this Agreement shall be
valid unless made in writing and signed by the parties hereto.
(b) This
Agreement may not be modified or amended except by an instrument in writing
signed by the parties hereto.
(c) No
term or condition of this Agreement shall be deemed to have been waived, nor
shall there be any estoppel against the enforcement of any provision of this
Agreement, except by written instrument of the party charged with such waiver
or
estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only
as
to the specific term or condition waived and shall not constitute a waiver
of
such term or condition for the future as to any act other than that specifically
waived.
17. SEVERABILITY
If,
for
any reason, any provision of this Agreement, or any part of any provision,
is
held invalid, such invalidity shall not affect any other provision of this
Agreement or any part of such provision not held so invalid, and each such
other
provision and part thereof shall to the full extent consistent with law continue
in full force and effect.
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18. HEADINGS
FOR REFERENCE ONLY
The
headings of sections and paragraphs herein are included solely for convenience
of reference and shall not control the meaning or interpretation of any of
the
provisions of this Agreement.
19. GOVERNING
LAW
This
Agreement shall be governed by the laws of the State of Delaware but only to
the
extent not superseded by federal law.
20. ARBITRATION
Any
dispute or controversy arising under or in connection with this Agreement shall
be settled exclusively by arbitration, conducted before a panel of three
arbitrators, one of whom shall be selected by the Company, one of whom shall
be
selected by Executive and the third of whom shall be selected by the other
two
arbitrators. The panel shall sit in a location within fifty (50)
miles from the location of the Company, in accordance with the rules of the
Judicial Mediation and Arbitration Systems (JAMS) then in
effect. Judgment may be entered on the arbitrators award in any court
having jurisdiction; provided, however, that Executive shall be entitled to
seek
specific performance of his right to be paid until the Date of Termination
during the pendency of any dispute or controversy arising under or in connection
with this Agreement.
21. PAYMENT
OF LEGAL FEES
All
reasonable legal fees paid or incurred by Executive pursuant to any dispute
or
question of interpretation relating to this Agreement shall be paid or
reimbursed by the Company, provided that the dispute or interpretation has
been
settled by Executive and the Company or resolved in Executive’s
favor.
22. INDEMNIFICATION
During
the term of this Agreement, the Company shall provide Executive (including
his
heirs, executors and administrators) with coverage under a standard directors
and officers liability insurance policy at its expense, and shall indemnify
Executive (and his heirs, executors and administrators) to the fullest extent
permitted under Delaware law against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which he may be involved by reason of his having been a director
or officer of the Company (whether or not he continues to be a director or
officer at the time of incurring such expenses or liabilities), such expenses
and liabilities to include, but not be limited to, judgments, court costs and
attorneys fees and the cost of reasonable settlements (such settlements must
be
approved by the Board of Directors of the Company). If such action,
suit or proceeding is brought against Executive in his capacity as an officer
or
director of the Company, however, such indemnification shall not extend to
matters as to which Executive is finally adjudged to be liable for willful
misconduct in the performance of his duties.
11
23. SUCCESSOR
TO THE COMPANY
The
Company shall require any successor or assignee, whether direct or indirect,
by
purchase, merger, consolidation or otherwise, to all or substantially all the
business or assets of the Bank or the Company, expressly and unconditionally
to
assume and agree to perform the Company’s obligations under this Agreement, in
the same manner and to the same extent that the Company would be required to
perform if no such succession or assignment had taken place.
IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officer and Executive has signed this Agreement, as
of
the day and date first above written.
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ATTEST:
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|||
|
/s/
Xxxxx LeBlon
|
By:
|
/s/
Xxxxxxxxx X. Xxxxx
|
|
|
Secretary
|
XXXXXXXXX
X. XXXXX
|
||
|
WITNESS:
|
EXECUTIVE
|
||
|
/s/
Xxxx Xxxxxxxx
|
By:
|
/s/
Xxxx X. Xxxxxxxxxx
|
|
|
XXXX
X. XXXXXXXXXX
|
|||
12
