Exhibit 10.3
DUTCHFORK BANCSHARES, INC.
EMPLOYMENT AGREEMENT
This AGREEMENT ("Agreement") is made effective as of June 29, 2000, by and
between DutchFork Bancshares, Inc. (the "Holding Company"), a corporation
organized under the laws of the State of Delaware with its principal offices at
0000 Xxxxxx Xxxx, Xxxxxxxx, Xxxxx Xxxxxxxx 00000 and J. Xxxxxx Xxxxxxx
("Executive"). Any reference to "Institution" or "Bank" herein shall mean
Newberry Federal Savings Bank or any successor thereto.
WHEREAS, the Holding Company wishes to assure itself of the services of
Executive for the period provided in this Agreement; and
WHEREAS, Executive is willing to serve in the employ of the Holding Company
on a full-time basis for said period.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:
1. POSITION AND RESPONSIBILITIES.
During the period of Executive's employment hereunder, Executive agrees to
serve as Chairman of the Board, President and Chief Executive Officer of the
Holding Company. Executive shall render administrative and management services
to the Holding Company such as are customarily performed by persons in a similar
executive capacity. During said period, Executive also agrees to serve, if
elected, as an officer or director of any subsidiary of the Holding Company.
2. TERM.
(a) The period of Executive's employment under this Agreement shall be
deemed to have commenced as of the date first above written and shall continue
for a period of thirty-six (36) full calendar months thereafter. Commencing on
the first anniversary date of this Agreement, and continuing on each anniversary
thereafter, the disinterested members of the board of directors of the Holding
Company ("Board") may extend the Agreement an additional year such that the
remaining term of the Agreement shall be thirty-six (36) months unless Executive
elects not to extend the term of this Agreement by giving written notice in
accordance with Section 8 of this Agreement. The Board will review the Agreement
and Executive's performance annually for purposes of determining whether to
extend the Agreement and the rationale and results thereof shall be included in
the minutes of the Board's meeting. The Board shall give notice to Executive as
soon as possible after such review as to whether the Agreement is to be
extended.
(b) During the period of Executive's employment hereunder, except for
periods of absence occasioned by illness, reasonable vacation periods, and
reasonable leaves of absence,
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Executive shall devote substantially all his business time, attention, skill,
and efforts to the faithful performance of his duties hereunder, including
activities and services related to the organization, operation and management of
the Holding Company and its direct or indirect subsidiaries ("Subsidiaries") and
participation in community, professional and civic organizations; provided,
however, that, with the approval of the Board, as evidenced by a resolution of
such Board, from time to time, Executive may serve, or continue to serve, on the
boards of directors of, and hold any other offices or positions in, companies or
organizations, which, in such Board's judgment, will not present any conflict of
interest with the Holding Company or its Subsidiaries, or materially affect the
performance of Executive's duties pursuant to this Agreement.
(c) Notwithstanding anything contained in this Agreement to the contrary,
Executive's employment with the Holding Company may be terminated by the Holding
Company or Executive during the term of this Agreement, subject to the terms and
conditions of this Agreement. However, Executive shall not perform, in any
respect, directly or indirectly, during the pendency of his temporary or
permanent suspension or termination from the Institution, duties and
responsibilities formerly performed at the Institution as part of his duties and
responsibilities as Chairman of the Board, President and Chief Executive Officer
of the Holding Company.
3. COMPENSATION AND REIMBURSEMENT.
(a) Executive shall be entitled to a salary from the Holding Company or its
Subsidiaries of $191,000 per year ("Base Salary"). Base Salary shall include any
amounts of compensation deferred by Executive under any tax-qualified retirement
or welfare benefit plan or any other deferred compensation arrangement
maintained by the Holding Company and its Subsidiaries. Such Base Salary shall
be payable in accordance with the Holding Company's payroll practices. During
the period of this Agreement, Executive's Base Salary shall be reviewed annually
in connection with Executive's performance evaluation by the Board and the
Board's consideration of any renewal or extension of the term of the Agreement.
Executive's salary review shall be conducted by the Board or by a Committee of
the Board delegated such responsibility by the Board. Any increase in Base
Salary shall become the "Base Salary" for purposes of this Agreement. In
addition to the Base Salary provided in this Subsection 3(a), the Holding
Company shall also provide Executive, at no premium cost to Executive, with all
such other benefits as provided uniformly to permanent full-time employees of
the Holding Company and its Subsidiaries. In addition, Executive shall be
entitled to incentive compensation and bonuses as provided in any plan or
arrangement of the Holding Company or its Subsidiaries in which Executive is
eligible to participate.
(b) Executive shall be entitled to participate in any 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 Holding Company and its
Subsidiaries will not, without Executive's prior written consent, make any
changes in such plans, arrangements or perquisites which would materially
adversely affect Executive's rights or benefits thereunder, except to the extent
that such changes are made applicable to all Holding Company and Institution
employees eligible to participate in such plans, arrangements and perquisites on
a non-discriminatory basis. Without limiting the generality of the foregoing
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provisions of this Subsection 3(b), Executive shall be entitled to participate
in or receive benefits under all plans relating to stock options, restricted
stock awards, stock purchases, pension, thrift, supplemental retirement,
profit-sharing, employee stock ownership, group life insurance, medical and
other health and welfare coverage, education, cash or stock bonuses that are now
or hereafter made available by the Holding Company or its Subsidiaries to its
senior executives and key management employees, subject to and on a basis
consistent with the terms, conditions and overall administration of such plans
and arrangements. Executive shall be entitled to incentive compensation and
bonuses as provided in any plan of the Holding Company and its Subsidiaries in
which Executive is eligible to participate. 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) The Holding Company shall pay or reimburse Executive for all reasonable
and documented expenses which have been authorized by the Board and which
Executive incurred in the performance of his obligations under this Agreement.
Further, the Holding Company may provide such additional compensation in such
form and such amounts as the Board may from time to time determine.
4. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION.
(a) Upon the occurrence of an Event of Termination (as defined in this
Agreement) during Executive's term of employment under this Agreement, the
provisions of this Section 4 shall apply. As used in this Agreement, an "Event
of Termination" shall mean and include any one or more of the following: (i) the
termination by the Holding Company of Executive's full-time employment hereunder
for any reason other than termination governed by Subsection 5(a) of this
Agreement, or for Cause, as defined in Section 7 of this Agreement; (ii)
Executive's resignation from the Holding Company's employ, upon, any (A) failure
to elect or reelect or to appoint or reappoint Executive as Chairman of the
Board, President and Chief Executive Officer, unless consented to by Executive,
(B) a material change in Executive's function, duties, or responsibilities with
the Holding Company or its Subsidiaries, 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 of this Agreement, unless
consented to by Executive, (C) a relocation of Executive's principal place of
employment by more than 25 miles from its location at the effective date of this
Agreement, unless consented to by Executive, (D) a material reduction in the
benefits and perquisites to Executive from those being provided as of the
effective date of this Agreement, unless consented to by Executive, (E) a
liquidation or dissolution of the Holding Company or the Institution, or (F)
breach of this Agreement by the Holding Company. Upon the occurrence of any
event described in clauses (A), (B), (C), (D), (E) or (F), above, the Holding
Company shall have the opportunity to cure the breach within thirty (30) days
after receiving notice from Executive that an Event of Termination had occurred.
If the Holding Company does not cure the event or circumstance constituting an
Event of Termination within the time period prescribed in this Subsection 4(a),
Executive shall have the right to elect to terminate his employment under this
Agreement by resignation upon not less than sixty (60) days prior written notice
thereafter.
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(b) Upon the occurrence of an Event of Termination, on the Date of
Termination, as defined in Section 8 of this Agreement, the Holding Company
shall be obligated to pay Executive, or, in the event of his subsequent death,
his beneficiary or beneficiaries, or his estate, as the case may be, a sum equal
to the sum of: (i) the Base Salary and bonuses in accordance with Subsection
3(a) of this Agreement that would have been paid to Executive for the remaining
term of this Agreement had the Event of Termination not occurred and (ii) all
benefits, including health insurance in accordance with Subsection 3(b) of this
Agreement that would have been provided to Executive for the remaining term of
this Agreement had an Event of Termination not occurred; provided, however, that
any payments pursuant to this Subsection 4(b) and Subsection 4(c) below shall
not, in the aggregate, exceed three (3) times Executive's average annual
compensation for the five (5) most recent taxable years that Executive has been
employed by the Holding Company or such lesser number of years in the event that
Executive shall have been employed by the Holding Company for less than five (5)
years. At the election of Executive, which election is to be made prior to an
Event of Termination, such payments shall be made in a lump sum. In the event
that no election is made, payment to Executive will be made on a monthly basis
in approximately equal installments during the remaining term of the Agreement.
In the event the Institution is not in compliance with its minimum capital
requirements or if such payments pursuant to this Subsection 4(b) would cause
the Institution's capital to be reduced below its minimum regulatory capital
requirements, such payments shall be deferred until such time as the Bank or
successor thereto is in capital compliance. Payments made under this Subsection
4(b) shall not be reduced in the event Executive obtains other employment
following termination of employment.
(c) Upon the occurrence of an Event of Termination, the Holding Company
will cause to be continued life, medical, dental and disability coverage
substantially equivalent to the coverage maintained by the Holding Company or
its Subsidiaries for Executive prior to his termination at no premium cost to
Executive. Such coverage shall cease upon the expiration of the remaining term
of this Agreement.
(d) Executive shall not be entitled to receive benefits under Subsections
4(b) or 4(c) of this Agreement in the event Executive is employed by the Bank or
another affiliate of the Holding Company following his termination of employment
from the Holding Company as a result of an Event of Termination.
5. CHANGE IN CONTROL.
(a) For purposes of this Agreement, a "Change in Control" of the Bank or
Holding Company shall mean an event of a nature that: (i) results in a Change in
Control of the Bank or the Holding Company within the meaning of the Home
Owners' Loan Act of 1933, as amended and the Rules and Regulations promulgated
by the Office of Thrift Supervision ("OTS") (or its predecessor agency), as in
effect on the date hereof; or (ii) 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 voting securities of the Bank or the Holding Company
representing 25% or more of the Bank's or the Holding Company's outstanding
voting securities or
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right to acquire such securities except for any voting securities of the Bank
purchased by the Holding Company and any voting securities purchased by any
employee benefit plan of the Holding Company or its Subsidiaries, 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-fourths (3/4) of the directors comprising
the Incumbent Board, or whose nomination for election by the Holding Company's
stockholders was approved by a Nominating Committee solely composed of members
which are Incumbent Board members, 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 Holding Company or similar transaction is consummated
in which the Bank or Holding Company is not the resulting entity.
(b) If a Change in Control has occurred pursuant to Subsection 5(a) of this
Agreement or the Board has determined that a Change in Control has occurred,
Executive shall be entitled to the benefits provided in paragraphs (c) and (d),
of this Section 5 upon his subsequent termination of employment at any time
during the twelve (12) month period following the date of the Change in Control
due to (i) Executive's dismissal, or (ii) Executive's voluntary resignation
following any demotion, loss of title, office or significant authority or
responsibility, reduction in the annual compensation or reduction in benefits or
relocation of his principal place of employment by more than 25 miles from its
location immediately prior to the Change in Control, unless such termination is
because of his death or termination for Cause.
(c) Upon Executive's entitlement to benefits pursuant to Subsection 5(b) of
this Agreement, the Holding Company shall pay Executive, or in the event of his
subsequent death, his beneficiary or beneficiaries, or his estate, as the case
may be, as severance pay or liquidated damages, or both, a sum equal to the
greater of: (i) the Base Salary and bonuses in accordance with Subsection 3(a)
of this Agreement that would have been paid to Executive for the remaining term
of this Agreement had the event described in Subsection (b) of this Section 5
not occurred and all benefits, including health insurance, in accordance with
Subsection 3(b) that would have been provided to Executive for the remaining
term of this Agreement had the event described in Subsection (b) of this Section
5 not occurred; or (ii) three (3) times Executive's Average Annual Compensation
(as defined herein) for the five (5) preceding taxable years that Executive has
been employed by the Holding Company or its Subsidiaries or such lesser number
of years in the event Executive shall have been employed with the Holding
Company or its Subsidiaries less than five (5) years; provided, however, that
any payments pursuant to this Section 5 shall not, in the aggregate, exceed
three (3) times Executive's Average Annual Compensation for the five (5) most
recent taxable years that Executive has been employed by the Holding Company or
such lesser number of years in the event that Executive shall have been employed
by the Holding Company for less than five (5) years. Average Annual Compensation
shall include all taxable income paid by the Holding Company or its
Subsidiaries, including but not limited to, Base Salary, commissions and
bonuses, as well as contributions on behalf of Executive to any pension and
profit sharing plan, severance payments, directors or committee fees and fringe
benefits paid or to be paid to Executive during such years. At the election of
Executive, which election is to be made prior to a Change in Control, such
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payment shall be made in a lump sum. In the event that no election is made,
payment to Executive will be made on a monthly basis in approximately equal
installments during the remaining term of the Agreement. In the event the Bank
is not in compliance with its minimum capital requirements or if such payments
pursuant to this Subsection 5(b) would cause the Bank's capital to be reduced
below its minimum regulatory capital requirements, such payments shall be
deferred until such time as the Bank or successor thereto is in capital
compliance. Payments under this Section 5 shall not be reduced in the event
Executive obtains other employment following termination of employment.
(d) Upon Executive's entitlement to benefits pursuant to Subsection 5(b) of
this Agreement, the Company will cause to be continued life, medical, dental and
disability coverage substantially equivalent to the coverage maintained by the
Institution for Executive at no premium cost to Executive prior to his
severance. Such coverage and payments shall cease upon the earlier of: (i) the
expiration of thirty-six (36) months following the Change in Control; or (ii)
employment by another employer who provides substantially similar life, medical,
dental and disability coverage.
6. CHANGE IN CONTROL RELATED PROVISIONS.
Notwithstanding the provisions of Section 5 of this Agreement, in no event
shall the aggregate payments or benefits to be made or afforded to Executive
under Section 5 or otherwise paid or provided by the Holding Company in
connection with a Change in Control (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, the 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
Executive's "base amount," as determined in accordance with said Section 280G.
The allocation of any reduction required with respect to the Termination
Benefits shall be determined by Executive.
7. TERMINATION FOR CAUSE.
The term "Termination for Cause" shall mean termination because of
Executive's personal dishonesty, willful misconduct, any breach of fiduciary
duty involving personal profit, intentional failure to perform stated duties,
willful violation of any law, rule, regulation (other than traffic violations or
similar offenses), final cease and desist order or material breach of any
provision of this Agreement. Notwithstanding the foregoing, Executive shall not
be deemed to have been terminated for Cause unless and until there shall have
been delivered to him a Notice of Termination which shall include a copy of a
resolution duly adopted by the affirmative vote of not less than three-fourths
(3/4) of the members of the Board at a meeting of the Board called and held for
that purpose (after reasonable notice to Executive and an opportunity for him,
together with counsel, to be heard before the Board), finding that in the good
faith opinion of the Board, Executive was guilty of conduct justifying
Termination for Cause and specifying the particulars thereof in detail.
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause. During the period beginning on the date
of the Notice of Termination for Cause pursuant to Section 8 of this Agreement
through the Date of Termination, stock options granted to Executive under any
stock option plan shall not be exercisable nor shall any unvested stock awards
granted to Executive
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under any stock benefit plan of the Institution, the Holding Company or any
subsidiary or affiliate thereof, vest. At the Date of Termination, such stock
options and any such unvested stock awards shall become null and void and shall
not be exercisable by or delivered to Executive at any time subsequent to such
Termination for Cause.
8. NOTICE.
(a) Any purported termination by the Holding 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 the date specified in the Notice of
Termination (which, 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).
(c) If, within thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, except upon the occurrence of a
Change in Control and voluntary termination by Executive in which case the Date
of Termination shall be the date specified in the Notice, 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 therefrom 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 such notice is given in good faith and the party giving such
notice pursues the resolution of such dispute with reasonable diligence. Except
as otherwise provided by this Agreement, following Executive's receipt of a
Notice of Termination, his employment with the Holding Company shall be
terminated and his rights to any and all benefits under this Agreement shall
cease.
9. POST-TERMINATION OBLIGATIONS.
All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with this Section 9 for one (1) full year
after the earlier of the expiration of this Agreement or termination of
Executive's employment with the Holding Company. Executive shall, upon
reasonable notice, furnish such information and assistance to the Holding
Company as may reasonably be required by the Holding Company in connection with
any litigation in which it or any of its subsidiaries or affiliates is, or may
become, a party.
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10. NON-COMPETITION AND NON-DISCLOSURE.
(a) Upon any termination of Executive's employment hereunder pursuant to
Section 4 of this Agreement, Executive agrees not to compete with the Holding
Company or its Subsidiaries for a period of one (1) year following such
termination in any city, town or county in which Executive's normal business
office is located and the Holding Company or any of its Subsidiaries has an
office or has filed an application for regulatory approval to establish an
office, determined as of the effective date of such termination, except as
agreed to pursuant to a resolution duly adopted by the Board. Executive agrees
that during such period and within said cities, towns and counties, Executive
shall not work for or advise, consult or otherwise serve with, directly or
indirectly, any entity whose business materially competes with the depository,
lending or other business activities of the Holding Company or its Subsidiaries.
The parties hereto, recognizing that irreparable injury will result to the
Holding Company or its Subsidiaries, its business and property in the event of
Executive's breach of this Subsection 10(a) agree that in the event of any such
breach by Executive, the Holding Company or its Subsidiaries, will be entitled,
in addition to any other remedies and damages available, to an injunction to
restrain the violation hereof by Executive, Executive's partners, agents,
servants, employees and all persons acting for or under the direction of
Executive. Executive represents and admits that in the event of the termination
of his employment pursuant to Section 7 of this Agreement, 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 Holding
Company or its Subsidiaries, 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 Holding Company or its Subsidiaries from
pursuing any other remedies available to the Holding Company or its Subsidiaries
for such breach or threatened breach, including the recovery of damages from
Executive.
(b) Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Holding Company and
its Subsidiaries as it may exist from time to time, is a valuable, special and
unique asset of the business of the Holding Company and its Subsidiaries.
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
Holding Company and its Subsidiaries thereof to any person, firm, corporation,
or other entity for any reason or purpose whatsoever unless expressly authorized
by the Board of Directors or required by law. 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 Holding Company. In the event of a
breach or threatened breach by Executive of the provisions of this Section 10,
the Holding Company will be entitled to an injunction restraining Executive from
disclosing, in whole or in part, the knowledge of the past, present, planned or
considered business activities of the Holding Company or its Subsidiaries or
from rendering any services to any person, firm, corporation, other entity to
whom such knowledge, in whole or in part, has been disclosed or is threatened to
be disclosed. Nothing herein will be construed as prohibiting the Holding
Company from pursuing any other remedies available to the Holding Company for
such breach or threatened breach, including the recovery of damages from
Executive.
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11. SOURCE OF PAYMENTS.
(a) All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Holding Company subject to Subsection 11(b)
of this Agreement.
(b) Notwithstanding any provision herein to the contrary, to the extent
that payments and benefits, as provided by this Agreement, are paid to or
received by Executive under the Employment Agreement dated June 29, 2000,
between Executive and the Institution, such compensation payments and benefits
paid by the Institution will be subtracted from any amount due simultaneously to
Executive under similar provisions of this Agreement. Payments pursuant to this
Agreement and the Institution Agreement shall be allocated in proportion to the
level of activity and the time expended on such activities by Executive as
determined by the Holding Company and the Institution on a quarterly basis.
12. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS.
This Agreement contains the entire understanding between the parties hereto
and supersedes any prior employment agreement between the Holding Company or any
predecessor of the Holding Company and Executive, except that this Agreement
shall not affect or operate to reduce any benefit or compensation inuring to
Executive of a kind elsewhere provided. No provision of this Agreement shall be
interpreted to mean that Executive is subject to receiving fewer benefits than
those available to him without reference to this Agreement.
13. 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 Holding Company and their respective successors and assigns.
14. MODIFICATION AND WAIVER.
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) 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
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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.
15. 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.
16. 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.
17. GOVERNING LAW.
This Agreement shall be governed by the laws of the State of Delaware
regardless of the laws that might otherwise govern under applicable principles
of conflicts of law.
18. 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 sitting in a location selected by Executive within fifty
(50) miles from the location of the Institution, in accordance with the rules of
the American Arbitration Association then in effect. Judgment may be entered on
the arbitrator's 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.
In the event any dispute or controversy arising under or in connection with
Executive's termination is resolved in favor of Executive, whether by judgment,
arbitration or settlement, Executive shall be entitled to the payment of all
back-pay, including salary, bonuses and any other cash compensation, fringe
benefits and any compensation and benefits due Executive under this Agreement.
19. 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 Holding Company, if Executive is successful pursuant to a
legal judgment, arbitration or settlement.
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20. INDEMNIFICATION.
(a) The Holding 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 Holding 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.
(b) Any payments made to Executive pursuant to this Section are subject to
and conditioned upon compliance with 12 U.S.C.ss.1828(k) and 12 C.F.R. Part 359
and any rules or regulations promulgated thereunder.
21. SUCCESSOR TO THE HOLDING COMPANY.
The Holding 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 Institution or the Holding
Company, expressly and unconditionally to assume and agree to perform the
Holding Company's obligations under this Agreement, in the same manner and to
the same extent that the Holding Company would be required to perform if no such
succession or assignment had taken place.
22. REQUIRED REGULATORY PROVISIONS.
In the event any of the foregoing provisions of this Section 22 are in conflict
with the terms of this Agreement, this Section 22 shall prevail.
(a) The Bank may terminate Executive's employment at any time, but any
termination by the Bank, other than Termination for Cause, shall not prejudice
Executive's right to compensation or other benefits under this Agreement.
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause as defined in Section 7 of this
Agreement.
(b) If Executive is suspended from office and/or temporarily prohibited
from participating in the conduct of the Bank'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.
ss.1818(e)(3) or (g)(1); the Bank 's and the Holding Company's obligations under
this contract shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the Bank or
the Holding Company may in its discretion: (i) pay Executive all or part of the
compensation withheld while their contract obligations were suspended; and (ii)
reinstate (in whole or in part) any of the obligations which were suspended.
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(c) If Executive is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C.
ss.1818(e)(4) or (g)(1), all obligations of the Bank and/or the Holding Company
under this contract shall terminate as of the effective date of the order, but
vested rights of the contracting parties shall not be affected.
(d) If the Bank is in default as defined in Section 3(x)(1) of the Federal
Deposit Insurance Act, 12 U.S.C. ss.1813(x)(1) all obligations of the Bank
and/or the Holding Company under this contract shall terminate as of the date of
default, but this paragraph shall not affect any vested rights of the
contracting parties.
(e) All obligations of the Bank and/or the Holding Company under this
contract shall be terminated, except to the extent determined that continuation
of the contract is necessary for the continued operation of the institution: (i)
by the Director of the OTS (or his designee), the FDIC or the Resolution Trust
Corporation, at the time the FDIC enters into an agreement to provide assistance
to or on behalf of the Bank under the authority contained in Section 13(c) of
the Federal Deposit Insurance Act, 12 U.S.C. ss.1823(c); or (ii) by the Director
of the OTS (or his designee) at the time the Director (or his designee) approves
a supervisory merger to resolve problems related to the operations of the Bank
or when the Bank is determined by the Director to be in an unsafe or unsound
condition. Any rights of the parties that have already vested, however, shall
not be affected by such action.
(f) Any payments made to Executive pursuant to this Agreement, or
otherwise, are subject to and conditioned upon compliance with 12
U.S.C.ss.1828(k) and 12 C.F.R.ss.545.121 and any rules and regulations
promulgated thereunder.
(g) Any payments made under this Agreement shall not, in the aggregate,
exceed three (3) times Executive's Average Annual Compensation (as defined in
this Agreement) for the five (5) most recent taxable years that Executive has
been employed by the Holding Company or such lesser number of years in the event
that Executive shall have been employed by the Holding Company for less than
five (5) years.
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SIGNATURES
IN WITNESS WHEREOF, DutchFork Bancshares, Inc. has caused this Agreement to
be executed and its seal to be affixed hereunto by its duly authorized officer
and its directors, and Executive has signed this Agreement, on the 5th day of
July, 2000.
ATTEST: DUTCHFORK BANCSHARES, INC.
/s/ Xxxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------------ --------------------------------------------
For the Entire Board of Directors
[SEAL]
WITNESS: EXECUTIVE
/s/ Xxxxxx X. Xxxxx By: /s/ J. Xxxxxx Xxxxxxx
------------------------ -----------------------------------------
J. Xxxxxx Xxxxxxx
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