EXHIBIT 10.11
AMENDED and RESTATED
--------------------
EMPLOYMENT AGREEMENT
--------------------
THIS AMENDED AND RESTATED AGREEMENT is made and entered into effective
as of the first day of January, 1996 between COAST FEDERAL BANK, FEDERAL SAVINGS
BANK, a federally chartered capital stock savings bank organized under the laws
of the United States and successor in interest to Coast Savings and Loan
Association (the "Company"), and XXX XXXXXX (the "Executive"), with reference to
the following facts:
A. The Executive is currently Chairman of the Board of Directors, and
Chief Executive Officer of the Company as well as an officer and/or director of
certain affiliates of the Company (the "Affiliates"). The Executive has been
employed by the Company since 1959, and is an innovative, highly experienced and
knowledgeable savings and loan executive whose creativity, expertise and effort
have been instrumental in the development of the business and growth of the
Company.
B. The Company recognizes that the future growth, profitability and
success of the business of the Company requires, and will be substantially and
materially advanced by the continued employment of the Executive. The Company
desires, therefore, to secure for the Company and its affiliates the continued
benefit of the Executive's experience, ability and leadership. In order to
retain the services of the Executive and to maximize the period of his continued
availability, and in recognition of his continuing contribution to the Company's
success, the Company desires to offer the Executive the compensation, amenities
and other benefits which executives of comparable experience and ability
generally receive.
C. A Post Retirement Compensation Arrangement, dated as of August 24,
1984, was previously entered into between the Company and the Executive, was
amended and supplemented by the Board of Directors of the Company ("the Board")
pursuant to the terms of the Employment Agreement between the Company and the
Executive dated as of June 24, 1986 (the "1986 Employment Agreement"), and
subsequently incorporated into the terms of the Executive's Amended and Restated
Employment and Post Retirement Compensation Agreement dated January 1, 1990 (the
"1990 Employment Agreement").
D. The Company and the Executive subsequently terminated the
retirement benefits payable under the provisions of the 1990 Employment
Agreement by mutual agreement, and replaced them with the retirement benefits to
which the Executive is
-1-
entitled under the terms of Bank's Amended and Restated Executive Supplemental
Retirement Plan dated June 24, 1991.
E. The 1990 Employment Agreement was amended and restated as of
January 1, 1993, as further amended by amendments dated January 1, 1994 and June
1, 1994 (the "1993 Employment Agreement"). The Company and the Executive now
wish to update, amend and restate the 1993 Employment Agreement.
NOW, THEREFORE, on the basis of the foregoing facts and in
consideration of the mutual covenants and agreements contained herein, the
parties hereto agree as follows:
1. Employment
----------
Association hereby agrees to employ the Executive and the Executive
hereby accepts employment with the Company, on the terms and subject to the
conditions hereinafter set forth in this Employment Agreement (hereinafter the
"Agreement").
2. Term
----
Subject to the provisions and conditions of this Agreement, the term
of this Agreement shall commence on the effective date of this Agreement, and
shall continue through December 31, 1998 (referred to herein as the "Initial
Term"), provided that such employment term shall be subject to extension(s)
pursuant to the provisions of this Section 2 and to earlier termination pursuant
to Section 10 herein (which defines terminating events).
(a) On or before January 1, 1997, and each January 1 thereafter, the
Board shall review this Agreement and the Executive's performance hereunder and
shall determine whether to extend the term of this Agreement for an additional
calendar year, thereby extending the remaining term of this Agreement to three
(3) calendar years. The Board shall also review the terms upon which this
Agreement should be extended as if the Board were approving the Agreement in the
first instance. For purposes of this Agreement, a reference to an "extension
date" shall pertain to any such January 1 as of which this Agreement is extended
for an additional calendar year under the provisions hereof, and a reference to
the "term" of this Agreement shall be inclusive of the Initial Term and any
extension(s) under the operation of this Section. In the event of any
extension(s) hereunder all provisions and conditions of this Agreement shall
remain in effect.
(b) In the event this Agreement becomes inoperative or is otherwise
terminated, all rights and benefits
-2-
which have become vested hereunder prior to such termination shall remain in
full force and effect and such termination shall not be construed as relieving
any party from the performance of any obligation requiring performance after the
date of such termination.
(c) In the event of a "change in control" of the Company (as defined
in Section 3(f) below), the Initial Term, or any extension thereto as described
above, shall be automatically extended so that the then remaining term is three
years.
3. Position And Duties
-------------------
(a) Subject to the provisions and conditions contained herein, the
Company hereby engages the Executive and the Executive hereby agrees to render
services to the Company as the Chairman of the Board and Chief Executive Officer
of the Company, or in such other capacity as the parties hereto shall mutually
agree, and as an executive officer of such of the Company's affiliates as the
parties hereto shall mutually agree, inclusive of affiliates which may be formed
or acquired subsequent to the date of this Agreement. The Executive shall have
responsibility for the overall conduct of the Company's business and shall have
authority to do and perform or cause to be performed such services, acts or
things as he shall deem necessary or advisable to manage and conduct the
business of the Company including supervision of all employees and consultants,
consistent with policies established from time to time by the Board. In the
performance of such duties, the Executive shall only be required to the Board.
(b) Subject to the provisions and conditions contained herein, the
Executive agrees that during the term hereof he shall, as long as he shall be
elected, serve as Chairman on the Board of Directors of the Company and serve on
the Boards of Directors of such of the Company's affiliates as the parties
hereto shall mutually agree, inclusive of affiliates which may be formed or
acquired subsequent to the date of this Agreement.
(c) The Executive's obligation to continue to render any of the
services and performances set forth above in Sections 3(a) and 3(b) is expressly
conditioned upon the Company's compliance, at all times during the term of this
Agreement, with all of the following: (i) the Company shall fully comply with
its obligations to the Executive under the terms of this Agreement including,
without limitation, its obligation respecting rate of compensation and fringe
benefits; (ii) in the event of a "change in control" of the Company (as defined
in Section 3(f) below): (A) the Executive shall be provided with the right to
continue to serve in the position of Chairman of the Board and Chief Executive
Officer of the Company (or in such other capacity as the parties
-3-
hereto shall mutually agree); (B) the Executive shall be provided with the right
to continue to serve as an officer and/or director of all Affiliates, as well as
any affiliates of the Company of which the Executive becomes an officer or
director subsequent to the date of this Agreement, subject to the Company's
unrestricted right to liquidate, reorganize or otherwise eliminate its interest
in any of its affiliates; (C) the Executive shall be provided with the right to
continue to fully exercise all responsibilities and duties of office which the
Executive is exercising as an officer of the Company or its affiliates as of the
date of this Agreement; and (D) the Executive shall not be assigned any duties
inconsistent with or in limitation of the powers of the Executive contemplated
by this Section 3. The aforesaid conditions to Executive's obligation to
continue to serve hereunder are cumulatively referred to hereafter as "assumed
conditions of service".
(d) The Executive agrees that during the term hereof he shall devote
substantially all of his regular business time solely and exclusively to the
business of the Company, whether such business is operated directly by the
Company or through one or more affiliates of the Company. The Executive agrees
that during the term of this Agreement, he will not, directly or indirectly,
provide services on behalf of any competitive financial institution, any
insurance association or agency, any mortgage or loan broker or any other
competitive entity or on behalf of any subsidiary or affiliate of any such
competitive entity, as an employee, consultant, independent contractor, agent,
sole proprietor, partner, joint venturer, corporate officer or director; nor
shall the Executive acquire by reason of purchase during the term of this
Agreement the ownership of more than 1% of the outstanding equity interest in
any such competitive entity. Subject to the foregoing, the Executive may serve
on Boards of Directors of unaffiliated corporations, subject to advance approval
by the Chief Executive Officer and such approved service shall be presumed for
these purposes to be of benefit to the association. The Executive shall
diligently carry out his responsibilities under this Agreement, it being hereby
agreed by the association that the Executive may engage in personal business and
investment activities, including real estate investments; provided further,
that, except as expressly set forth above, nothing contained herein shall be
construed as preventing the Executive from making personal investments in the
stocks, securities and obligations of other financial institutions.
(e) The Company reserves the right to elect, from time to time, any
person to its Board of Directors, to appoint any person as an officer of the
Company and to remove any of its officers and directors, without exception, in
any manner and upon the basis or bases presently or subsequently provided for by
its Charter and Bylaws, provided however, that except when expressly
-4-
provided herein to the contrary, any such removal shall not relieve the Company
from any of its existing obligations to the Executive, or any additional
obligations set forth under the terms of this Agreement. Nothing herein shall be
deemed to limit the Chief Executive Officer's authority to retain, supervise or
remove Association personnel.
(f) For the purpose of this Agreement, a change in control of the
Company shall mean the acquisition by any person or entity of control of the
Company, or any entity controlling the Company, within the meaning of Section
583.7 of the Regulations for Savings and Loan Holding Companies of the Office of
Thrift Supervision, provided, however, that no change in control shall be deemed
to occur in the event of any regulatory action specified in Section 10(a) (viii)
below, or in the event of any merger, consolidation, or corporate
reorganization in which the owners prior to said combination of the capital
stock entitled to vote in the election of Directors ("Voting Stock") of the
Company or any organization controlling the Company receive 75% or more of the
resulting entity's Voting Stock. Without limitation of the foregoing, a change
in control shall be deemed to occur if any person or entity directly or
indirectly acquires ownership, control, power to vote, or proxies representing
more than 25 percent of the Voting Stock of the Company or any entity
controlling the Company, or obtains control of the election of a majority of the
directors of the Company or any entity controlling the Company.
(g) During and after the term of this Agreement, the Executive shall
not disclose to any person (other than an employee or agent of the Company or
any affiliate entitled to receive the same) any confidential information
relating to the business of the Company or any affiliate and obtained by him
while providing services to the Company, without the consent of the Board, or
until such information ceases to be confidential. Notwithstanding the
foregoing, the Executive shall not be precluded from disclosures respecting the
Company where made pursuant to compulsory legal process or when otherwise
required by an appropriate government agency.
-5-
4. Place of Performance
--------------------
In connection with his employment by the Company, the executive shall
at all times be entitled to maintain his office at the principal executive
offices of the Company, presently located in Los Angeles, California. The
Company shall not, without the written consent of the Executive, transfer the
Executive to a location that is more than 30 miles from the Executive's
principal residence. The Company shall promptly pay (or reimburse the
Executive for) all reasonable moving expenses incurred by the Executive as a
result of a change of his principal residence in connection with any such
relocation, and will indemnify the Executive against, and reimburse the
Executive for, any loss incurred as a result of the sale of his principal
residence (which loss shall be computed for the purpose hereof as the difference
between the actual sales price of such residence and the higher of (a) the
Executive's aggregate investment in such residence for (b) the fair market value
of such residence as determined by a real estate appraiser designated by the
Company) in connection with any such change in residence.
5. Working Facilities
------------------
The Executive shall be furnished with a private office, stenographic
and other necessary secretarial assistance, and with such other facilities,
amenities and service as are presently or may hereafter be furnished to the most
senior executive officers of the Company; provided that such facilities,
amenities and services shall, in the reasonable judgment of the Executive, be
appropriate for the Executive's position with the Company and adequate for the
performance of his duties hereunder.
6. Compensation
------------
(a) As compensation for the performance of Executive's services
hereunder, inclusive of services as Chairman of the Board, as a member of
various committees of the Board, and as an officer and director of the Company's
affiliates, the Company shall pay to the Executive in accordance with its normal
payroll practices a monthly salary (the "Monthly Base Salary") in such amount as
shall be determined from time to time by the Board (or a duly authorized
committee or representative thereof) and set forth in the Executive's personnel
file. For the purposes of this Agreement, the Monthly Base Salary payable to
the Executive shall mean the gross amount payable to the Executive prior to any
deductions for withholding taxes and voluntary contributions by the Executive to
any deferred compensation plan maintained by the Company.
-6-
(b) The Monthly Base Salary payable to the Executive during any
calendar year during the term of this Agreement (including extensions)
subsequent to 1996 shall in no event be less than the highest Monthly Base
Salary received by the Executive during calendar year 1996 Nothing contained
herein, however, shall be construed as requiring the Company to raise, from time
to time, the amount of the Executive's Monthly Base Salary or to award the
Executive with additional bonuses or incentive compensation during the term of
this Agreement, and any such raises, bonuses or incentive compensation shall be
awarded at the sole discretion of the Board (or a duly authorized committee or
representative thereof).
(c) In the event the Executive's Monthly Base Salary is increased
during the term of this Agreement, the minimum Monthly Base Salary payable to
the Executive subsequent to the date of such increase shall be the Monthly Base
Salary as so increased, unless the Executive otherwise agrees. In the event of
a "change in control" of the Company (as such term is defined in Section 3(f)
herein) during the term of this Agreement, the Monthly Base Salary payable to
the Executive for the balance of the then current year and for each succeeding
calendar year during the term of this Agreement shall in no event be less than
the sum of (i) the aggregate amount of Monthly Base Salary and (ii) one-twelfth
(1/12) of the aggregate amount of any "discretionary bonuses" attributable to
one of the last two bonus computation years that ended on or before the change
in control, whichever is higher. For the purposes hereof, discretionary bonuses
shall include amounts paid pursuant to the Company's Executive Senior Management
Incentive Program, but shall not otherwise include any amounts payable to the
Executive pursuant to any benefit program covered by Section 8 herein (dealing
with the employee benefit programs and other fringe benefits to which the
Executive is entitled) unless the payment of benefits thereunder is totally in
the discretion of the Company's Board of Directors.
(d) The Executive shall receive a gross-up payment if the payments and
benefits under this Agreement and all other contracts, arrangements, or
programs, in the aggregate, exceed the maximum amount that may be paid to the
Executive without triggering golden parachute penalties under Section 280G and
related provisions of the Code. The gross-up amount will be an amount which,
after payment by the Executive of all income and excise taxes on the gross-up
payment, equals the excise taxes the Executive must pay under Code Section 4999
with respect to the payments and benefits for which the Executive is receiving
the gross-up payment.
-7-
(i) All determinations needed to apply this Section 6(d) shall be
made in good faith by the Company's independent auditors. The independent
auditors shall assume that the Executive pays federal income taxes at the
highest marginal tax rate in the calendar year in which the gross-up payment is
to be made and state and local income taxes at the highest marginal rate of
taxation in the state and locality of the Executive's residence when the
Executive's employment terminated, net of the maximum reduction in federal
income taxes which could be obtained from deduction of those state and local
taxes.
(ii) If the Executive's gross-up payment turns out to have been
insufficient (for example, because the Executive receives payments which were
not expected when the gross-up payment was calculated), the Company will pay the
Executive an additional gross-up payment which, on an after tax basis, shall be
sufficient to cover both the extra Code Section 4999 excise taxes the Executive
owes and any interest, penalties, or additions the Executive must pay because of
the miscalculation of the Executive's excise tax liability. If the Executive
receives a gross-up payment which turns out to have been excessive, the
Executive must pay the Company the excise tax included in the gross-up that the
Executive did not, in fact, have to pay, the federal, state, and local income
tax gross-up the Executive received with respect to that excise tax amount (to
the extent that the Executive is allowed a federal state, or local income tax
deductions with respect to the repayment), and interest on the amount the
Executive must repay at the rate provided in Code Section 1274(b)(2)(B).
(iii) The Executive and the Company agree reasonably to cooperate
with the other in connection with any administrative or judicial proceedings
concerning the existence or amount of golden parachute penalties with respect to
payments or benefits the Executive receives.
(iv) If all or part of the gross-up payment described in this
Paragraph (d) may not be paid for any reason, and the net amount the Executive
would realize would increase by cutting back the amount paid to the Executive so
that the Code Section 4999 penalties would not be triggered, then the
Executive's payments and benefits shall be cut back in the priority order the
Executive designates or, if the Executive fails promptly to designate an order,
in the priority order designated by the Company.
7. Expenses
--------
Subject to compliance with the Company's normal and customary policies
regarding substantiation and verification of business expenses, the Executive is
authorized to incur on behalf
-8-
of the Company, and the Company shall directly pay or shall fully reimburse the
Executive for, all customary and reasonable expenses incurred for promoting,
pursuing or otherwise furthering the business of the Company or its affiliates.
8. Fringe Benefits
---------------
During the term of this Agreement, the Executive shall be entitled to
participate in, and to receive benefits and perquisites under, any formal or
informal employee benefit plans, understandings, arrangements or programs now or
hereafter made available by the Company or its affiliates to executives, key
management employees and their families on terms at least as favorable as those
provided to any other executive of the Company or its affiliates. The benefits
and perquisites received by the Executive during the term of this Agreement
shall at all times be commensurate with his position as Chief Executive Officer
of a major financial institution and, in the event of a "change in control" of
the Company (as such term is defined in Section 3(f) herein), the benefits and
perquisites provided to the Executive shall not thereafter be reduced below
their highest level during the six month period immediately preceding such
change in control. Nothing paid to or received by the Executive pursuant to
this Section 8 shall be deemed to be in lieu of any of the compensation to the
Executive provided for in Section 6 of this Agreement.
9. Vacations
---------
The Executive shall be entitled to a minimum of four weeks of vacation
time each year during the term of this Agreement, as well as additional vacation
time equal to that available to other top executive officers of the Company of
comparable tenure, during which vacation time his compensation hereunder shall
be paid in full. Such vacation time need not be taken in consecutive periods
except as otherwise required by applicable regulations. The Executive shall
also be entitled to all paid holidays provided by the Company to its most senior
executive officers.
10. Termination
-----------
(a) Terminating Events. This Agreement may be terminated or suspended
------------------
prior to the expiration of its term in accordance with the following:
(i) Death. This Agreement shall terminate upon the
-----
Executive's death.
(ii) Disability. In the event that the Executive becomes
----------
disabled within the meaning of the Coast Savings
-9-
and Loan Pension Plan, and remains so disabled for substantially all of a 180
day period and has not returned to work by the end of such 180 day period, this
Agreement shall terminate effective as of the last day of such 180 day period of
disability.
(iii) Cause. This Agreement shall be subject to termination
------
by the Board for cause, which for purposes of this Agreement shall mean a
termination on the grounds of the Executive's personal dishonesty, incompetence,
willful misconduct, breach of fiduciary duty involving personal profit,
intentional failure to perform stated duties, willful violation of any law, rule
or regulation (other than traffic violations or similar offenses) or final
cease-and-desist order, or in the event of a material breach by the Executive of
any provision of this Agreement. For purposes of this Agreement, the Executive
shall not be deemed to have been terminated for cause unless and until 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 called and held for this purpose after reasonable notice
to the Executive and an opportunity for him, together with his counsel, to be
heard by the Board, finding that, in the good faith opinion of the Board, the
Executive is guilty of misconduct of the type described in this Section
10(a)(iii), and specifying the particulars thereof in detail and in the case of
misconduct that can be cured, the Executive shall have failed to cure the same
within a reasonable period of time thereafter.
(iv) Regulatory Removal. If the Executive is removed from
-------------------
office and/or permanently prohibited from participating in the conduct of the
Company's affairs by an order issued under Section 8(e)(4) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. 1818(e)(4) or (g)(1), all obligations
of the date of the order, but such termination shall not affect any of the
vested rights of either of the parties to this Agreement.
(v) Regulatory Suspension. If the Executive is suspended
----------------------
from office and/or temporarily prohibited from participating in the conduct of
the Company's affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. 1818(e)(3) or (g)(1)), the Company's
obligations under this Agreement shall be suspended as of the date of service,
unless stayed by appropriate proceedings. In the event that the service of a
notice in the manner provided above results in the suspension of any
compensation due to the Executive during the term promptly following the
dismissal of the charges specified in such notice the Company may, in its
discretion, pay to the Executive all compensation that was withheld from him and
may, in its discretion, pay to the Executive all compensation that was
-10-
withheld from him and may, in its discretion, reinstate all of the obligations
of the Company suspended hereunder.
(vi) Default. If the Company is in default (as defined in
--------
section 3(x)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1813(x)(1), this
Agreement shall terminate as of the date of such default, but this paragraph
10(a)(vi) shall not affect any vested rights of the contracting parties.
(vii) Other Regulatory Action. All obligations under this
-----------------------
Agreement shall be terminated, except to the extent it is determined that
continuation of the Agreement is necessary for the continued operation of the
Company: (A) by the Director of the Office of Thrift Supervision or his or her
designee at the time the Federal Deposit Insurance Corporation or Resolution
Trust Corporation enters into an agreement to provide assistance to or on behalf
of the Company under the authority contained in Section 13(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1823(c)); or (B) by the Director of the Office
of Thrift Supervision or his or her designee at the time such Director or his or
her designee approves a supervisory merger to resolve problems related to the
operation of the Company or when the Company is determined by such Director to
be in an unsafe and unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
(viii) Notice by the Executive. This Agreement may be terminated
------------------------
by the Executive upon ninety (90) days written notice, provided that: (A) a
termination by the Executive within one year of a change in control (as defined
in Section 3(f) (above) or in the event the Company shall fail to continuously
provide the Executive with working conditions that fully comply, both in form
and substances, with each and every of the "assumed conditions of service" as
defined in Section 3(c) above shall be deemed a termination by the Company under
Section 10(a)(ix) below, and (B) a termination by the Executive during the
thirty day period immediately following the one year anniversary of a "change in
control" of the Company (as defined in Section 3(f)) shall be deemed a
termination by the Company under Section 10(a)(ix) below.
(ix) Notice by the Company. This Agreement may be terminated
---------------------
at any time by the Executive upon ninety (90) days written notice; provided,
however, that a termination of this Agreement under this Section 10(a)(ix) shall
not reduce the remaining Term of this Agreement for purposes of calculating the
amounts payable to the Executive under Section 10(b)(iv).
(b) Compensation and Benefits Payable By the Company Upon Termination.
-----------------------------------------------------------------
Compensation and benefits shall be
-11-
payable by the Company upon a termination of this Agreement in accordance with
the following:
(i) In the event of a termination of this Agreement under Section
10(a)(i) (due to the Executive's death), the spouse, heirs or estate of the
Executive shall continue to receive the compensation specified in Section 6 and
the Executive's spouse and/or dependents shall continue to receive the medical
insurance benefits previously provided pursuant to Section 8 (subject to payment
by such spouse or dependents of any premium co-payment then required by the
terms of the Company's group medical insurance policy) for the balance of the
then remaining term of this Agreement, notwithstanding such termination.
(ii) In the event of a termination of this Agreement under Section
10(a)(ii) (due to the disability of the Executive), the Executive, or his duly
appointed personal representatives, shall continue to receive the compensation
specified in Section 6 and the Executive, his spouse and/or his dependents shall
continue to receive the medical insurance benefits previously provided pursuant
to Section 8 (subject to payment by the Executive, his spouse and/or dependents
of any premium co-payment then required by the terms of the Company's group
medical insurance policy) for the balance of the then remaining term of this
Agreement, notwithstanding such termination.
(iii) In the event of a termination of this Agreement under Sections
10(a)(iii)-(viii) (due to a termination of the Executive for cause, regulatory
removal or suspension, default by the Company, other regulatory action of notice
by the Executive, excluding a deemed termination by the Company under Section
10(a)(ix)), the Company's obligation to provide the compensation and benefits
specified in Sections 6, 7 and 8 herein shall terminate as of the effective date
of such termination (subject to potential reinstatement in the case of a
regulatory suspension, as provided in Section 10(a)(v).
(iv) In the event of a termination of this Agreement under Section
10(a)(ix) (due to termination of the Executive without cause, including a deemed
termination by the Company under Section 10(a)(ix)) the Company shall make a
lump sum payment to the Executive (or his personal representatives, spouse,
heirs or estate should he thereafter become disabled or die) equal to the
discounted present value, based on a discount rate equal to the then current
Eleventh District Cost of Funds Index, of the future compensation payable to the
Executive under Section 6 of this Agreement. Such lump sum payment shall be
made within thirty days following the date of such termination. In addition,
following any such termination the Company shall continue to provide the
Executive, his spouse and/or his dependents with the
-12-
medical insurance benefits previously provided pursuant to Section 8 (subject to
payment by the Executive, his spouse and/or his dependents of any premium co-
payment then required by the terms of the Company's group medical insurance
policy) for the balance of the then remaining term of this Agreement.
11. Definition of "Affiliate"
-------------------------
The term "affiliate", as used in this Agreement, shall mean any
person, firm, corporation, association, organization, or unincorporated trade or
business that, now or hereafter, directly or indirectly, controls, is controlled
by, or is under common control with the Company, including without limitation,
any service corporation of the Company.
12. Nonassignment
-------------
(a) The obligations and duties of the Executive under this Agreement
are personal and not assignable. This Agreement shall inure to the benefit of
and shall be binding upon the Company, its successors and its assigns. As used
in this Agreement, the term "successor" shall include any firm, corporation or
other business entity which at any time, whether by merger, consolidation,
conversion or other corporate reorganization involving the Company, directly or
indirectly acquires all or substantially all of the assets or business of the
Company. This Agreement may not be assigned by the Company without the prior
written consent of the Executive.
(b) Neither the Executive nor his wife or his estate shall have any
right to alienate, pledge, hypothecate, encumber or dispose of the right to
receive payments under this Agreement, nor shall such payments be subject to
pledge, attachment or claims of creditors. Such payments and the rights thereto
are expressly declared to be nonassignable and nontransferable. In the event of
any attempted assignment or transfer, the Company shall not be bound thereby and
shall be relieved of its liability under this Agreement by making payments in
accordance with this Agreement to the parties designated to receive payments
under this Agreement.
-13-
13. Successors
----------
(a) The Company agrees that it will require any successor, by
agreement in form and substance satisfactory to the Executive, to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place, provided that no such written assumption shall be required in
connection with a transaction that does not constitute a change in control as
defined in Section 3(f) above. As used in this Agreement, the term "Company"
shall include any successor to its business and/or assets which becomes bound by
all the terms and provisions of this Agreement by agreement or by operation of
law, without regard to whether such successor executes and delivers the
agreement provided for in this Section 13.
(b) 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, distributees,
devises and legatees. If the Executive should die while any amounts would still
be payable to him hereunder if he had continued to live, all such amounts shall
be paid in accordance with the terms of this Agreement to the Executive's
estate, unless the Executive has provided written notice to the Company
specifying a different beneficiary or beneficiaries (which notice(s) may be
changed from time to time at the option of the Executive, subject to the consent
of the Executive's spouse if his spouse then has an enforceable interest in such
benefits).
14. Waiver And Modification
-----------------------
Any waiver, alteration or modification of any of the terms of this
Agreement shall be valid only if made in writing and signed by the parties
hereto. No waiver by either of the parties hereto of their rights hereunder
shall be deemed to constitute a waiver with respect to any subsequent
occurrences or transaction hereunder unless such waiver specifically states that
it is to be construed as a continuing waiver.
15. Governing Law; Severability
---------------------------
This Agreement shall be governed by and construed in accordance with
the laws of California. Any provision of this Agreement which is prohibited or
unenforceable shall be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
-14-
16. Arbitration
-----------
Any dispute or controversy under or in connection with this Agreement
as well as any differences which may arise between the Company and the Executive
during or following the Executive's employment with the Company shall be settled
exclusively in accordance with the provisions of The Coast Federal Bank Mutual
Agreement to Arbitrate Claims ("the Arbitration Agreement"), a copy of which is
attached hereto marked "Exhibit A" and incorporated by reference herein, except
that the provisions of the Arbitration Agreement as appearing on page 5 under
the heading of "Not an Employment Agreement" are not made a part of or
incorporated within this Employment Agreement. The provisions of this
Employment Agreement shall exclusively govern the nature of the Executive's
employment with the Company.
17. Notices
-------
All notices, requests, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered or if mailed by United States certified or registered mail, prepaid,
to the parties or their permitted assignees at the following addresses (or at
such other address as shall be given in writing by either party to the other):
TO THE COMPANY;
Coast Federal Bank, Federal Savings Bank
0000 Xxxxxxxx Xxxxxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: General Counsel
TO THE EXECUTIVE:
The most recent address of the Executive as shown in the personnel
records of the Company.
The date of such personal delivery or the date three days after such mailing
shall be deemed to be the effective date of such notice, demand or
communication.
18. Headings
--------
Headings herein are for convenience only, are not a part hereof and
shall not be used in construing this Agreement.
-15-
19. Entire Agreement
----------------
This Agreement constitutes and embodies the entire understanding and
agreement of the parties hereto relating to the matters addressed herein.
Except as otherwise provided herein, there are no other agreements or
understandings, written or oral, in effect between the parties relating to the
matters addressed herein.
20. Counterparts
------------
This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement effective as of the day and year first above written.
/s/ XXX XXXXXX
--------------------------------------------
XXX XXXXXX (the "Executive")
COAST FEDERAL BANK, FEDERAL SAVINGS BANK (the
"Company")
By: /s/ XXXXX X. XXXXXX
-----------------------------------------
Xxxxx X. Xxxxxx, Chairman of the
Compensation Committee of the Board of Directors
of Coast Federal Bank, Federal Savings Bank
-16-
[LOGO OF COAST FEDERAL BANK]
Exhibit A
THE COAST FEDERAL BANK
MUTUAL AGREEMENT TO ARBITRATE CLAIMS
I (also referenced herein as "Employee") recognize that differences may
arise between Coast Federal Bank ("the Company") and me during or following my
employment with the Company, and that those differences may or may not be
related to my employment. I understand and agree that by entering into this
Agreement to Arbitrate Claims ("Agreement"), I anticipate gaining the benefits
of a speedy, impartial dispute-resolution procedure.
I understand that any reference in this Agreement to the Company will be a
reference also to its parent company, all subsidiary and affiliated entities,
all benefit plans, the benefit plans' sponsors, fiduciaries, administrators,
affiliates, and all successors and assigns of any of them.
CLAIMS COVERED BY THE AGREEMENT
-------------------------------
The Company and I mutually consent to the resolution by arbitration of all
claims or controversies ("claims"), whether or not arising out of my employment
(or its termination), that the Company may have against me or that I may have
against the Company or against its officers, directors, employees or agents in
their capacity as such or otherwise. The claims covered by this Agreement are
claims that would normally, absent this Agreement, be cognizable by a court of
law, and include, but are not limited to, claims of wages or other compensation
due; claims for breach of any contract or covenant (express or implied); tort
claims; claims for discrimination (including, but not limited to, race, sex,
religion, national origin, age, marital status, or medical condition, handicap
or disability); claims for benefits (except where an employee benefit or pension
plan specifies that its claims procedure shall culminate in an arbitration
procedure different from this one), and claims for violation of any federal,
state, or other governmental law, statute, regulation, or ordinance, except
claims excluded in the following paragraph.
CLAIMS NOT COVERED BY THE AGREEMENT
----------------------------------
Claims I may have for workers' compensation or unemployment compensation
benefits are not covered by this Agreement.
Also not covered are claims by the Company for injunctive and/or other
equitable relief for unfair competition and/or the use and/or unauthorized
disclosure of trade secrets or confidential information, as well as claims by
the Company for injunctive and/or other equitable relief for matters regarding
any loan(s) or savings or checking accounts the Employee may obtain or maintain
with the Company, as to which I
1
[LOGO OF COAST FEDERAL BANK]
understand and agree that the Company may seek and obtain relief from a court of
competent jurisdiction.
REQUIRED NOTICE OF ALL CLAIMS
-----------------------------
The Company and Employee agree that, as the first step to starting the
arbitration process, the aggrieved party must give written notice of any claim
to the other party within the applicable statute of limitation period.
Written notice to the Company, or its officers, directors, employees or
agents, shall be sent to Human Resources Division of the Company at Coast
Federal Bank, 00000 Xxxxxxxxxx Xxxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx, attention
Human Resources Director. The Employee will be given written notice at the last
recorded in my personnel file.
The written notice shall identify and describe the nature of all claims
asserted and the facts upon which such claims are based. The notice shall be
sent to the other party by certified or registered mail, return receipt
requested.
REPRESENTATION
--------------
Any party may be represented by an attorney or other representative
selected by the party.
DISCOVERY
---------
Each party shall have the right to take the deposition of one individual
and any expert witness designated by another party. Each party also shall have
the right to make requests for production of documents to any party. The
subpoena right specified below shall be applicable to discovery pursuant to this
paragraph. Additional discovery may be had only where the Arbitrator selected
pursuant to this Agreement so orders, upon a showing of substantial need.
DESIGNATION OF WITNESSES
------------------------
At least 30 days before the arbitration, the parties must exchange lists of
witnesses, including any expert, and copies of all exhibits intended to be used
at the arbitration.
SUBPOENAS
---------
Each party shall have the right to subpoena witnesses and documents for the
arbitration.
2
[LOGO OF COAST FEDERAL BANK]
ARBITRATION PROCEDURES
----------------------
The Company and Employee agree that, except as provided in this Agreement,
any arbitration shall be in accordance with either the Employment Arbitration
Rules (if such rules cease to exist or are changed by J.A.M.S, the substantive
equivalent rules shall be used as determined by the Company) of Judicial
Arbitration & Mediation Services, Inc. or, if applicable, the successor
organization to Judicial Arbitration Mediation Services, Inc.(hereinafter
"J.A.M.S") or the Employment Dispute Resolution Arbitration Rules of the
American Arbitration Association (if such rules cease to exist or are changed by
A.A.A., the substantive equivalent rules shall be used as determined by the
Company) or, if applicable, the successor organization to the American
Arbitration Association (hereinafter "A.A.A.",) before an arbitrator who is
licensed to practice law in the state in which the arbitration is convened ("the
Arbitrator"). The determination to use J.A.M.S or A.A.A. as the Arbitrator shall
be made solely by the party who did not initiate the claim. The determination to
use either J.A.M.S or A.A.A. shall be made by the party who did not initiate the
claim within thirty (30) calendar days of receipt by the non complaining party
of the written notice of claim as submitted by the complaining party. In the
event the noncomplaining party fails to make a determination to utilize either
J.A.M.S or A.A.A. and to provide written notice of such determination to use
either J.A.M.S or A.A.A. to the aggrieved party within such thirty (30) days
period, it shall be conclusively deemed that the arbitration shall be heard by
J.A.M.S. The arbitration shall take place in the offices of J.A.M.S or A.A.A.,
as the case may be, nearest to the city in which I am or was last employed by
the Company or such other place as may be mutually agreed in writing between
Employee and the Company.
The Arbitrator shall be selected as follows. J.A.M.S or A.A.A., as the case
may be, shall give each party a list of 11 arbitrators drawn from its panel of
labor and employment arbitrators. Each party may strike all names on the list it
deems unacceptable. If only one common name remains on the list of all parties,
that individual shall be designated as the Arbitrator. If more than one common
name remains on the lists of all parties, the parties shall strike names
alternately until only one remains: The party who did not initiate the claim
shall strike first. If no common name remains on the lists of all parties,
J.A.M.S or A.A.A., as the case may be, shall furnish an additional list or lists
until an Arbitrator is selected.
The Arbitrator shall apply the substantive law (and the law of remedies, if
applicable) of the state in which the claim arose, or federal law, or both, as
applicable to the claim(s) asserted. The State of California Code of Evidence
shall apply. Damages recoverable for claims brought under this agreement include
those damages and/or remedies provided by the applicable statutes, which may
include punitive damages, back wages, reinstatement and other monetary or
equitable damages. The Arbitrator, and not any federal, state, or local court or
agency, shall have exclusive authority to resolve any dispute relating to the
interpretation, applicability, enforceability or formation of this Agreement,
including but not limited to any claim that all or any part of this Agreement
3
[LOGO OF COAST FEDERAL BANK]
is void or voidable. The arbitration shall be final and binding upon the
parties, except as provided in this Agreement.
The Arbitrator shall have jurisdiction to hear and rule on pre-hearing
disputes and is authorized to hold pre-hearing conferences by telephone or in
person as the Arbitrator deems necessary. The Arbitrator shall have the
authority to entertain a motion to dismiss and/or a motion for summary judgment
by any party and shall apply the standards governing such motions under the
State of California Code of Civil Procedure.
Either party, at its expense, may arrange for and pay the cost of a court
reporter to provide a stenographic record of proceedings.
Either party, upon request at the close of hearing, shall be given leave to
file a post-hearing brief. The time for filing such a brief shall be set by the
Arbitrator.
Either party may bring an action in any court of competent jurisdiction to
compel arbitration under this Agreement and to enforce an arbitration award.
Except as otherwise provided in this Agreement, both the Company and I agree
that neither of us shall initiate or prosecute any lawsuit or administrative
action (other than an administrative charge of discrimination) in any way
related to any claim covered by this Agreement.
The Arbitrator shall render an award and opinion in the form typically
tendered in labor arbitrations.
ARBITRATION FEES AND COSTS
--------------------------
The Company and I shall equally share the fees and costs of the Arbitrator
except, however, if the claim relates to a monetary amount where an amount is
less than fifty thousand dollars ($50,000) then the share of the fees and costs
of the Arbitrator of the Company and Employee shall be as follows: If the amount
of the claim is less than fifty thousands dollars ($50,000) but more than
twenty-five thousand dollars ($25,000), the fees and costs of the Arbitrator
shall be allocated 66 2/3 for the Company and 33 1/3 for Employee; and if the
amount of the claim is less than twenty-five thousand dollars ($25,000) the fees
and costs of the Arbitrator shall be allocated 90% for the Company and 10% for
the Employee. Each party will deposit funds or post other appropriate security
for its share of the Arbitrator's fee, in an amount and manner determined by the
Arbitrator, 10 days before the first day of hearing. Each party shall pay for
its own costs and attorneys' fees, if any. However, if any party prevails on a
statutory claim which affords the prevailing party attorneys' fees, or if there
is a written agreement providing for fees, the Arbitrator may award reasonable
fees to the prevailing party.
4
[LOGO OF COAST FEDERAL BANK]
JUDICIAL REVIEW
---------------
Either party may bring an action in any court of competent jurisdiction to
compel arbitration under this Agreement and to enforce an arbitration award. A
party opposing enforcement of an award may not do so in an enforcement
proceeding, but must bring a separate action in any court of competent
jurisdiction to set aside the award, where the standard of review will be the
same as that applied by an appellate court reviewing a decision of a trial court
sitting without a jury.
REQUIREMENTS FOR MODIFICATION OR REVOCATION
-------------------------------------------
This Agreement to arbitrate shall survive the termination of my employment.
It can only be revoked or modified by a writing signed by the parties which
specifically states an intent to revoke or modify this Agreement.
SOLE AND ENTIRE AGREEMENT
-------------------------
This is the complete agreement of the parties on the subject of arbitration
of disputes except for any arbitration agreement, if any, existing in connection
with any pension or benefit plan. This Agreement supersedes any prior or
contemporaneous oral or written understanding on the subject. No party is
relying on any representations, oral or written, on the subject of the effect,
enforceability or meaning of this Agreement, except as specifically set forth in
this Agreement.
CONSTRUCTION
------------
If any provision of this Agreement is adjudged to be void or otherwise
unenforceable, in whole or in part, such adjudication shall not affect the
validity of the remainder of the Agreement.
CONSIDERATION
-------------
The promises by the Company and by me to arbitrate differences, rather than
litigate them before courts or other bodies, provide consideration for each
other.
NOT AN EMPLOYMENT AGREEMENT
---------------------------
This Agreement is not, and shall not be construed to create, any contract
of employment, express or implied. Nor does this agreement in any way alter
the "at-will" status of my employment.
5
[LOGO OF COAST FEDERAL BANK]
VOLUNTARY AGREEMENT
-------------------
I ACKNOWLEDGE THAT I HAVE CAREFULLY READ THIS AGREEMENT, THAT I UNDERSTAND
ITS TERMS, THAT ALL UNDERSTANDINGS AND AGREEMENTS BETWEEN THE COMPANY AND ME
RELATING TO THE SUBJECTS COVERED IN THE AGREEMENT ARE CONTAINED IN IT, AND THAT
I HAVE ENTERED INTO THE AGREEMENT VOLUNTARILY AND NOT IN RELIANCE ON ANY
PROMISES OR REPRESENTATIONS BY THE COMPANY OTHER THAN THOSE CONTAINED IN THIS
AGREEMENT ITSELF. I FURTHER ACKNOWLEDGE AND UNDERSTAND THAT BY ENTERING INTO
THIS AGREEMENT, I AM WAIVING MY RIGHT TO A JURY TRIAL.
I FURTHER ACKNOWLEDGE THAT I HAVE BEEN GIVEN THE OPPORTUNITY TO DISCUSS
THIS AGREEMENT WITH MY PRIVATE LEGAL COUNSEL AND HAVE AVAILED MYSELF OF THAT
OPPORTUNITY TO THE EXTENT I WISH TO DO SO.
[EMPLOYEE NAME] COAST FEDERAL BANK,
Federal Savings Bank
-----------------------------
Signature of Employee -----------------------------
Signature of Authorized Company
Representative
-----------------------------
Print Name of Employee
-----------------------------
Title of Representative
-----------------------------
Employee Number
-----------------------------
Date
6
