EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (the "Agreement") is dated effective
as of June 1, 1999 (the "Effective Date"), by and between Xxxxx Xxx
("Executive") and Umpqua Holdings Corporation ("Umpqua").
1. EMPLOYMENT. Umpqua, either directly or one of its wholly owned
subsidiaries, employs the Executive and the Executive accepts that employment
on the terms and conditions contained in this Agreement.
2. TERM. Umpqua agrees to employ the Executive for a period of two years
commencing on the Effective Date (the "Term"), unless that employment is
terminated earlier in accordance with this Agreement.
3. OPTION TO EXTEND. Umpqua has the option to extend, in its sole
discretion, the Executive's employment for one additional year upon written
notice to the Executive no less than 60 days prior to the expiration of the
Term.
4. DUTIES; POSITION.
4.1 Position. Executive shall be employed as Senior Vice
President/Retail Operations of South Umpqua Bank (the "Bank"), and as such
will have overall responsibility for the Bank's retail operations and such
other duties as may be designated by the President of Umpqua and will report
to the President of Umpqua.
4.2 Obligations to Umpqua.
(a) Executive agrees that to the best of his ability and experience
Executive will at all times loyally and conscientiously perform all of
the duties and obligations required of and from Executive pursuant to the
express and implicit terms of this Agreement and at the direction of the
President of Umpqua.
(b) Executive agrees that Executive will devote all of his business
and professional time and attention to the business affairs of Umpqua.
Executive shall not be employed by any person (including any individual
or entity) other than Umpqua in connection with any other business
activity.
5. BASE COMPENSATION. For services performed under this Agreement,
Executive shall be entitled to a salary ("Base Salary") of a minimum of $7,500
per month together with perquisites provided to senior officers of Umpqua.
6. TERMINATION. The employment of Executive shall terminate upon the
occurrence of any one or more of the events in this Section 6.
6.1 For Cause. Umpqua's termination of Executive for Cause (as
defined in Section 7.1 below) ("Termination For Cause").
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6.2 Without Cause. Umpqua's termination of Executive without Cause,
at any time at Umpqua's sole discretion, for any or no reason other than for
Cause ("Termination Without Cause").
6.3 By New President/Chief Executive Officer. Umpqua's termination
of Executive within six (6) months following the initial date of employment of
a President and Chief Executive Officer other than Xxxxxxx X. Xxxxx
("Termination by New President/CEO").
6.4 For Good Reason. Executive's termination of his employment with
Umpqua for Good Reason (as defined in Section 7.2 below) within the 90-day
period immediately following one of the events set forth in Section 7.2 below
("Termination For Good Reason").
6.5 End of Term. Upon the expiration of the term of this Agreement
the employment of Executive shall revert to employment-at-will and this
Agreement shall terminate, unless this Agreement is renewed in writing by the
parties.
6.6 Death or Disability. Upon Executive's death or Disability (as
defined in Section 7.3 below).
7. DEFINITIONS.
7.1 Cause. For the purposes of this Agreement, "Cause" for
Executive's termination will exist upon the occurrence of one or more of the
following events:
(a) Dishonest or fraudulent conduct by Executive with respect to the
performance of his duties with Umpqua;
(b) Conduct by Executive that materially discredits Umpqua or is
materially detrimental to the reputation of Umpqua, including conviction
or a plea of nolo contendere of Executive of a felony or crime involving
moral turpitude;
(c) Executive's willful misconduct or gross negligence in
performance of his duties under this Agreement, including but not limited
to Executive's refusal to comply in any material respect with the legal
directives of the Board of Directors or the President and Chief Executive
Officer;
(d) An order from a state or federal banking regulatory agency
requesting or requiring removal of Executive or a finding by any such
agency that Executive's performance threatens the safety or soundness of
Umpqua or any of its subsidiaries;
(e) Executive's failure to materially perform the duties set forth
in Section 4 of this Agreement; or
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(f) Breach of Executive's fiduciary duties to Umpqua.
7.2 Good Reason. For purposes of this Agreement, "Good Reason" for
Executive's termination will exist upon the occurrence of one or more of the
following events:
(a) A material adverse change in Executive's position causing such
position to be of materially reduced stature or responsibility;
(b) A reduction of Executive's Base Salary unless in connection
with, and to the same degree as, reductions in the salaries of all or
substantially all similarly situated employees of Umpqua; or
(c) An unconsented requirement for Executive to relocate to a
facility or location more than 50 miles from Executive's current
location.
7.3 Disability. For purposes of this Agreement, "Disability" shall mean
that Executive has been unable to perform his duties under this Agreement as a
result of his incapacity due to physical or mental illness, and such
inability, which continues for at least 120 consecutive calendar days or 150
calendar days during any consecutive 12-month period, if shorter, after its
commencement, is determined to be total and permanent by a physician selected
by Umpqua and its insurers and acceptable to Executive or Executive's legal
representative (with such agreement on acceptability of the physician not to
be unreasonably withheld).
8. SEVERANCE BENEFITS. Executive shall be entitled to receive severance
benefits upon termination of employment only as set forth in this Section 8.
8.1 Termination Without Cause or For Good Reason. In the event of a
Termination Without Cause or Termination For Good Reason, Executive will
receive payment for all Base Salary and benefits accrued as of the date of
Executive's termination together with a payment of severance benefits equal to
six (6) months Base Salary.
8.2 Termination by Reason of Death or Disability. In the event of a
Termination by reason of death or Disability, Executive will receive payment
for all Base Salary and benefits accrued as of the date of Executive's
termination.
8.3 Termination by New President/CEO. In the event of a Termination
by New President/CEO, Executive will receive payment for all Base Salary and
benefits accrued as of the date of termination together with a payment of
severance benefits equal to six (6) months Base Salary.
8.4 Termination Relating to a Change in Control.
(a) In the event that Executive is terminated in anticipation of, in
connection with, or within one hundred eighty (180) days following the
closing date of a Change in Control and without Cause, then Umpqua, or
its successor in interest, shall pay Executive all Base Salary and
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benefits accrued as of the date of termination together with severance
benefits equal to two (2) years Base Salary.
(b) In the event that Executive is terminated 180 days or more after
the closing date of a Change in Control and without Cause, then Umpqua,
or its successor in interest, shall pay Executive all Base Salary and
benefits accrued as of the date of termination together with severance
equal to the greater of (i) an amount equal to two (2) years Base Salary
from the closing date of the Change in Control minus the Base Salary for
the number of days elapsed since the closing date of the Change in
Control or (ii) as otherwise provided in this Agreement.
8.5 Section 280G. All severance payments made under this Agreement
must be within the limits set forth in Section 280G of the Internal Revenue
Code; if a payment would otherwise be an "excess parachute payment" as defined
in Section 280G, the payment shall be reduced to avoid the applicability of
Section 280G.
9. DEFINITION OF CHANGE IN CONTROL. For the purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred when any of the following
events takes place:
9.1 Acquisition of Fifty Percent or More of Voting Power. Any person
(including any individual or entity) or persons acting in concert becomes the
beneficial owner of voting shares representing fifty percent (50%) or more of
the voting power of Umpqua.
9.2 Removal of Directors. A majority of the Board of Directors of
Umpqua are removed from office by a vote of the shareholders of Umpqua over
the recommendation of the Board of Directors then serving.
9.3 Merger. Umpqua is a party to a plan of merger or plan of
exchange and upon consummation of such plan, the shareholders of Umpqua do not
own or continue to own at least a majority of the shares of the surviving
company.
10. ARBITRATION. Any dispute or claim arising out of or in connection
with this Agreement will be finally settled by binding arbitration in
Roseburg, Oregon in accordance with the rules of the American Arbitration
Association by one arbitrator appointed in accordance with said rules. The
arbitrator shall apply Oregon law, without reference to rules of conflicts of
law or rules of statutory arbitration, to the resolution of any dispute.
Judgment on the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. Notwithstanding the foregoing, the parties may
apply to any court of competent jurisdiction for preliminary or interim
equitable relief, or to compel arbitration in accordance with this Section 10,
without breach of this arbitration provision.
11. CONFIDENTIAL INFORMATION. The parties acknowledge that in the course
of Executive's duties he will have access to and become familiar with certain
proprietary and confidential information of Umpqua and other information about
Umpqua not known by its actual or potential competitors. Executive
acknowledges that such information constitutes valuable, special, and unique
assets of Umpqua's business, even though such information may not be of a
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technical nature and may not be protected under trade secret or related laws.
Executive agrees that he will hold in a fiduciary capacity and will not use
for himself and will not reveal, communicate, or divulge during the period of
his employment with Umpqua or at any time thereafter, and in any manner
whatsoever, any such date and confidential information of any kind, nature, or
description concerning any matters affecting or relating to Umpqua's business,
its customers, or its services, to any person, firm, entity, or company other
than Umpqua or persons, firms, entities, or companies designated by Umpqua.
Executive agrees that all memoranda, notes, records, papers, customer files,
and other documents, and all copies thereof relating to Umpqua's operations or
business, or matters related to any of Umpqua's customers, some of which may
be prepared by Executive, and all objects associated therewith in any way
obtained by Executive, shall be Umpqua's property.
12. NOTICES. All notices, requests, demands, and other communications
provided for by this Agreement will be in writing and shall be deemed
sufficient upon receipt, when delivered personally or by a
nationally-recognized delivery service (such as Federal Express), or three
business days after being deposited in the U.S. mail as certified mail, return
receipt requested, with postage prepaid, if such notice is addressed to the
party to be notified at such party's address as set forth below or as
subsequently modified by written notice.
To Umpqua: Umpqua Holdings Corporation
000 X.X. Xxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attention:President
To Executive: Xxxxx Xxx
X.X. Xxx 0000
Xxxxxxxx, XX 00000
13. GENERAL PROVISIONS.
13.1 Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Oregon, without giving effect to the principles of conflict of laws.
13.2 Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to
renegotiate such provision(s) in good faith. In the event that the parties
cannot reach a mutually agreeable and enforceable replacement for such
provision, then (i) such provision shall be excluded from this Agreement, (ii)
the balance of the Agreement shall be interpreted as if such provisions were
so excluded, and (iii) the balance of the Agreement shall be enforceable in
accordance with its terms.
13.3 Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
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13.4 Entire Agreement. This Agreement constitutes the sole agreement
of the parties and supersedes all oral negotiations and prior writings with
respect to the subject matter hereof.
13.5 Waiver. No waiver of any provision of this Agreement shall be
valid unless in writing, signed by the party against whom the waiver is sought
to be enforced. The waiver of any breach of this Agreement or failure to
enforce any provision of this Agreement shall not waive any later breach.
13.6 Assignment. Executive shall not assign or transfer any of his
rights pursuant to this Agreement, wholly or partially, to any other person or
to delegate the performance of its duties under the terms of this Agreement.
13.7 Attorneys' Fees. In the event of any arbitration or legal
proceeding relating to this Agreement, the prevailing party in such proceeding
shall be entitled to recover reasonable attorneys' fees in such proceeding, or
any appeal thereof, to be set by the arbitrators or the court without the
necessity of hearing testimony or receiving evidence, in addition to the costs
and disbursements allowed by law.
14. ADVICE OF COUNSEL. EACH PARTY TO THIS AGREEMENT ACKNOWLEDGES
THAT, IN EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE OPPORTUNITY TO SEEK
THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND UNDERSTOOD ALL OF
THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE
CONSTRUED AGAINST ANY PARTY BE REASON OF THE DRAFTING OR PREPARATION HEREOF.
UMPQUA HOLDINGS CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, Director, President and
Chief Executive Officer
/s/ Xxxxx Xxx
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Xxxxx Xxx
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