Exhibit 10.1
EMPLOYMENT AGREEMENT
AGREEMENT made this 1ST day of JUNE, 1999 (the "Effective Date"), between Xxx
X. Xxxxxx (the "Executive") and National Bancshares Corporation of Texas, a
Texas corporation, (the "Company").
The Board of Directors of the Company (the "Board") desires to provide for
the employment of the Executive as Chairman of the Board ("COB") and the
Executive is willing to commit himself to serve the Company and the Board, on
the terms and conditions herein provided.
In order to effect the foregoing, the Company and the Executive wish to enter
into an employment agreement (the "Agreement") on the terms and conditions
set forth below. Accordingly, in consideration of the premises and the
respective covenants and agreements of the parties herein contained, and
intending to be legally bound hereby, the parties hereto agree as follows:
1. EMPLOYMENT. The Company hereby agrees subject to the approval
of the Board to employ the Executive, and the Executive hereby agrees
to serve the Company, on the terms and conditions set forth herein.
2. TERM. The term of this Agreement shall commence as of the date
hereof and shall continue for three years. Upon the expiration of the
initial three (3) year term, this Agreement shall be automatically
renewed for successive periods of one (1) year each, unless, not later
than thirty (30) days prior to the end of the initial term or any
renewal term, the Company shall have given notice to the Executive or
the Executive shall have given notice to the Company that either of
them does not wish to extend this Agreement. The first one (1) year
renewal period shall commence on the first day immediately following
the conclusion of the initial three year term.
3. POSITION AND DUTIES. The Executive shall serve at the pleasure and
direction of the Board as the Chairman of the Board of the Company and
shall have such responsibilities, duties and authority reasonably
accorded to and expected of a Chairman with Executive's skills,
knowledge and background and as may from time to time be prescribed by
or pursuant to the Company's Bylaws. The Executive shall devote as much
time as necessary to effectively carry out his responsibilities of
maximizing shareholder value, while overseeing the Company's compliance
with regulatory requirements. Nothing in this agreement shall be
construed as preventing the Executive from engaging in outside business
activities or in passive investments when such activities do not
interfere with the Executive's obligations to the Company.
4. PLACE OF PERFORMANCE. In connection with the Executive's
employment by the Company, the Executive's place of performance shall
be not be restricted in any way.
5. COMPENSATION OF RELATED MATTERS.
(a) SALARY. During the term of the employment set forth in
Section 2, the Company shall pay to the Executive an annual base salary
of Eighty Thousand Dollars ($80,000.00), such salary to be paid in
substantially equal monthly installments. Compensation of the Executive
by salary payments shall not be deemed exclusive and shall not prevent
the Executive from participating in any other compensation, tax benefit
or other benefit plans of the Company.
(b) EXPENSES. During the terms of the Executive's employment
hereunder, the Executive shall be entitled to receive prompt
reimbursement of all reasonable and customary expenses incurred by the
Executive in performing services hereunder, including all travel,
living and/or office expenses while away from home or business at the
request of and in the service of the Company, provided that such
expenses are incurred and accounted for in accordance with the policies
and procedures established by the Company.
(c) OTHER BENEFITS. It is agreed that the benefits that the
Executive and members of his immediate family shall receive shall be
generally those available to the executive officers of the Company
(including without limitation such retirement plans, incentive
compensation plans, medical plans, severance plans, life insurance
plans and disability plans as the Company may from time to time
maintain.) The Company and the Executive will agree upon discretionary
bonus and stock incentive plans based upon performance. The parties
agree that these benefits shall continue for so long as the Executive
continues to serve the Company.
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6. TERMINATION. The Executive's employment hereunder may be
terminated without any breach of this Agreement only under the
following circumstances:
(a) DEATH. The Executive's employment hereunder shall
terminate upon his death.
(b) DISABILITY. If, as a result of the Executive's incapacity
due to physical or mental illness, the Executive shall have been absent
from his duties hereunder for the entire period of three (3)
consecutive months, and within thirty (30) days after written Notice of
Termination (as defined in subsection (e) of the Section 6 is given
(which may occur before or after the end of such three (3) month
period, the Executive shall not have returned to the performance of his
duties hereunder, the Company may terminate the Executive's employment
hereunder.
(c) CAUSE. The Company may terminate the Executive's
employment hereunder for Cause (as defined herein). For purposes of
this Agreement, the Company shall have "Cause" to terminate the
Executive's employment hereunder for (i) the Executive's negligence in
the performance or intentional nonperformance (continuing for ten (10)
days after receipt of written notice of need to cure) of any of the
Executive's responsibilities to the Company hereunder, (ii) the
Executive's willful commission of any criminal act or fraud with
respect to the Company or which may affect the reputation of the
Company adversely, (iii) the Executive's willful dishonesty, (iv) the
Executive's willful gross misconduct, or (v) the Executive's willful
violation of a material condition of his employment by the Company
(continuing for ten (10) days after receipt of written notice of need
to cure).
(d) TERMINATION BY THE EXECUTIVE. This Agreement may be
terminated by the Executive should the Company fail to observe or
perform any of the provisions of this Agreement required to be observed
or performed by the Company. The Executive shall give the Company
written notice of the breaches or failure on the Company's part and the
Company shall have thirty (30) days within which to cure such
violation. Any violation cured within this thirty (30) day period shall
be as though it had never existed. Any violation that continues to
exist at the end of the thirty (30) day period shall, at the
Executive's option, give rise to the termination of this Agreement
except as otherwise provided herein.
(e) Any termination of the Executive's employment by the
Company or by the Executive (other than termination pursuant to
subsection 6(a) hereof) shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 11.
For purposes of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision of this
Agreement relied upon and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provisions so indicated.
(f) "Date of Termination" shall mean (i) if the Executive's
employment is terminated by his death, the date of his death, (ii) if
the Executive's employment is terminated pursuant to subsection 6(b)
above, thirty (30) days after Notice of Termination is given and
effective (provided that the Executive shall not have returned to the
performance of his duties on a full-time basis during such thirty (30)
day period), (iii) if the Executive's employment is terminated pursuant
to subsection 6(c) above, the date specified in the Notice of
Termination, and (iv) if the Executive's employment is terminated for
any other reason, the date on which a Notice of Termination is given.
7. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
(a) During any period that the Executive fails to perform his
duties hereunder as a result of incapacity due to physical or mental
illness, the Executive shall continue to receive his full salary at the
rate then in effect for such period until his employment is terminated
pursuant to subsection 6(b) hereof (a "Disability Termination"); and,
after such Disability Termination, the Company shall pay to the
Executive one hundred percent (100%) of the salary he would have
otherwise received under Section 5 hereof for the partial term
remaining in the then current term of this Agreement plus an additional
amount calculated pursuant to subsection 7(d)(B), and payment so made
to the Executive shall be in addition to, and not in lieu of, any
disability benefits payable under policies or programs maintained by
the Company.
(b) If the Executive's employment is terminated by his death,
the Company shall pay any amounts due to the Executive under Section 5
through the date of his death, and the Company shall thereafter pay his
legal representative or any beneficiary designated by him in writing
one hundred percent (100%) of the salary he would have otherwise
received under Section 5 hereof for the partial term remaining in the
then current term of this Agreement plus an additional amount
calculated pursuant to subsection 7(d)(B). Any payment under this
subsection 7(b) shall be in addition to, and not in lieu of, any
periodic payments of death benefits payable under policies or
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programs maintained by the Company.
(c) If the Executive's employment shall be terminated by the
Company for Cause or by the Executive other than pursuant to subsection
6(d), the Company shall pay the Executive any amounts due under Section
5 through the Date of Termination;
(d) If (i) the Executive's employment is terminated by the
Company for any reason other than for Cause, (ii) the Company elects
not to renew this Agreement pursuant to Section 2 hereof, or (iii) the
Executive shall terminate his employment pursuant to subsection 6(d),
then the Company shall pay to the Executive the following:
(A) any and all amounts due under Section 5(a)
through the Date of Termination; and
(B) the greater of the amount of salary the Executive
would have otherwise received under Section 5 hereof
for the partial term remaining in the then current
term of this Agreement or six (6) months salary at
the rate then in effect for such period. This amount
shall be paid as a lump sum to the Executive within
thirty (30) days of the termination of his
employment.
8. INDEMNIFICATION. To the fullest extent authorized or permitted by
the laws of the State of Texas as from time to time is effect, the
Company shall hold harmless and indemnify the Executive against any and
all judgments, penalties (including excise and similar taxes), fines,
settlements and reasonable expenses (including, but not limited to
attorneys' fees), incurred in connection with any actual or threatened
action or proceeding, whether civil or criminal, to which the Executive
is made or is threatened to be made a party by reason of the fact that
the Executive then is or was a director or officer of the Company or
then serves or has served any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise in any
capacity at the request of the Company. To the fullest extent so
permitted, the foregoing shall apply to actions by or in the right of
the Company and shall in any actual or threatened proceeding require
the Company to advance expenses on behalf of the Executive as said
expenses are incurred.
9. CONFIDENTIAL INFORMATION. The Executive recognizes that as a key
employee of the Company, the Executive has and will continue to occupy
a position of trust with respect to such business information of a
secret or confidential nature which is or will become the property of
the Company or any of its subsidiaries or affiliates and which has been
or will be used by or imparted to the Executive from time to time in
the course of the Executive's duties. The Executive therefore agrees
that for so long as any such information of a secret or confidential
nature shall remain confidential or otherwise remain wholly or
partially protectable, either during the course of the Executive's
employment or thereafter, the Executive will not at any time use,
divulge, or furnish or make accessible to any person outside of the
Company (or any subsidiaries or affiliates thereof) any such
information.
10. BINDING AGREEMENT. This Agreement and all rights of the Executive
hereunder shall inure to the benefit of and be enforceable by the
Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributes, devisees and legatees.
If the Executive should die while any amounts would still be payable to
him hereunder if he continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms
of this Agreement to the Executive's designated beneficiary set forth
in a written Beneficiary Designation filed with the Company or, it
there be no such designated beneficiary, to the Executive's estate.
11. NOTICE. For purposes of this Agreement, notices, demands, request
and all other communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when delivered or
(unless otherwise specified) mailed by the United States certified or
registered mail, return receipt requested, postage prepaid, addressed
as follows:
If to the Executive:
Xxx X. Xxxxxx
X.X. Xxx 000
Xxxxx Xxxxxx, XX 00000
If to the Company:
National Bancshares Corporation
of Texas 00000 Xxxxxxx 000 Xxxxx
Xxx Xxxxxxx, XX 00000
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or to such other address as any party may have furnished to the others
in writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
12. MISCELLANEOUS. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by the Executive and such officer of the
Company as may be specifically designated by the Board. No waiver by
either party hereto at any time of any breach by the other party hereto
of, or compliance with, any condition or provisions of the Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions as the same time or at any prior to
subsequent time. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the
State of Texas without regard to its conflicts of law principles. The
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.
13. VALIDITY. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity
or enforceability of any other provisions of this Agreement, which
shall remain in full force and effect.
14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all
of which together will constitute one and the same instrument.
15. 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 (3) arbitrators in San
Antonio, Texas in accordance with the rules of the American Arbitration
Association then in effect. The arbitrators do not have the authority
to add to, detract from or modify any provisions hereof. The
arbitrators do have the Authority to order reinstatement and/or
back-pay in the event the arbitrators determine that the Executive was
not terminated for Cause, as defined on subsection 6(c) hereof. Each
party shall have an opportunity to present evidence on the issues in
dispute before the arbitrator and each party may be represented by
legal counsel. A decision by a majority of the arbitration panel shall
be final and binding. Judgement may be entered on the arbitrator's
award in any court having jurisdiction. The arbitrators shall decide
which party will bear the expenses of such arbitration (including
attorneys' fees) .
16. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement of
the parties hereto in respect of the subject matter contained herein
and supersede all other prior agreements, promises, covenants,
arrangements, communications, representations or warranties whether
oral or written, by any officer, employee or representative of any
party hereto; and any prior agreement of the parties hereto in respect
of the subject matter contained herein is hereby terminated and
canceled.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and
year first above written.
NATIONAL BANCSHARES CORPORATION OF
TEXAS (THE "COMPANY")
BY:
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XXXXXX X. XXXXXX
PRESIDENT
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XXX X. XXXXXX
(THE "EXECUTIVE")
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