TierOne bank AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.2
TierOne
bank
AMENDED
AND RESTATED EMPLOYMENT AGREEMENT
This
AMENDED AND RESTATED AGREEMENT is made effective as of December 17, 2008,
by and between TierOne Bank (the “Bank”), a federally-chartered savings bank,
with its principal administrative ▇▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇ ▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the “Executive”).
WHEREAS, the Executive is currently
employed as the President and Chief Operating Officer of the Bank pursuant to an
employment agreement between the Bank and the Executive entered into as of
September 25, 2000, as subsequently amended by resolutions of the Board of
Directors and as previously amended and restated effective as of July 27,
2006 (the “Bank Employment Agreement”);
WHEREAS, the Executive is currently
employed as the President and Chief Operating Officer of TierOne Corporation,
the parent company of the Bank (the “Company”) pursuant to an employment
agreement between the Company and the Executive entered into as of October 1,
2002 and as previously amended and restated effective as of July 27, 2006
and as amended effective as of December 20, 2006, which is being further amended
and restated as of the date hereof (the “Company Employment
Agreement”);
WHEREAS, the Bank desires to amend and
restate the Bank Employment Agreement in order to make changes to comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), as
well as certain other changes;
WHEREAS, the Bank desires to assure
itself of the continued availability of the Executive's services as provided in
this Agreement; and
WHEREAS, the Executive is willing to
serve the Bank on the terms and conditions hereinafter set forth;
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 his employment hereunder, the Executive agrees to serve as
President and Chief Operating Officer of the Bank. The Executive shall render
administrative and management services to the Bank such as are customarily
performed by persons situated in a similar executive capacity. The Executive
also agrees to perform such other duties, services and responsibilities as may
from time to time be requested by the Bank. During said period of his
employment, the Bank agrees to elect the Executive as a member of the Board of
Directors.
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2. TERMS
AND DUTIES.
(a) The
period of the Executive's employment under this Agreement shall be deemed to
have commenced as of January 1, 2008 and shall continue for a period of
thirty-six (36) full calendar months thereafter. Commencing on the first
anniversary date of January 1, 2008 and continuing on each anniversary
thereafter, the disinterested members of the board of directors of the Bank
("Board") may extend the Agreement an additional year such that the remaining
term of the Agreement shall be three (3) years unless the 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 the
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 the Executive as
soon as possible after such review as to whether the Agreement is to be
extended.
(b) During
the period of the Executive's employment hereunder, except for periods of
absence occasioned by illness, reasonable vacation periods (four (4) weeks per
year), and reasonable leaves of absence, the 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 Bank and
participation in community and civic organizations; provided, however, that,
with the approval the Board, as evidenced by a resolution of such Board, from
time to time, the Executive may serve, or continue to serve, on the boards of
directors of, and hold other offices or positions in, companies or
organizations, which, in such Board's judgment, will not present any conflict of
interest with the Bank, or materially affect the performance of the Executive's
duties pursuant to this Agreement.
(c) Notwithstanding
anything herein to the contrary, the Executive's employment with the Bank may be
terminated by the Bank or the Executive during the term of this Agreement,
subject to the terms and conditions of this Agreement.
3. COMPENSATION
AND REIMBURSEMENT.
(a) The
Bank shall pay the Executive as compensation a salary of $377,500 per year
(“Base Salary”). Such Base Salary shall be payable in accordance with the normal
payroll practices of the Bank then in effect (but in any event in substantially
equal installments, not less frequently than monthly) and subject to all
applicable taxes required to be withheld by the Bank pursuant to federal, state
or local law. During the period of this Agreement, the Executive's Base Salary
shall be reviewed at least annually; the first such review will be made no later
than one year from the date of this Agreement. Such review shall be conducted by
the Board or by a Committee of the Board, delegated such responsibility by the
Board. The Committee or the Board may increase the Executive’s Base Salary and
once established at an increased specified rate shall not thereafter be reduced.
Any increase in Base Salary shall become the “Base Salary” for purposes of this
Agreement. In addition to, and not to be construed as part of, the Base Salary
provided in this Section 3(a), the Bank shall also provide the Executive with
all such other benefits as are provided uniformly to permanent full-time
employees of the Bank.
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(b) The
Executive shall be entitled to participate in any employee benefit plans,
arrangements and perquisites substantially equivalent to those available to
executive officers of the Bank, and the Bank will not, without the Executive’s
prior written consent, make any changes in such plans, arrangements or
perquisites which would materially adversely affect the Executive's rights or
benefits thereunder, except to the extent such changes are made applicable to
all Bank employees on a non-discriminatory basis. Without limiting the
generality of the foregoing provisions of this Subsection (b), the Executive
shall be entitled to participate in or receive benefits under any employee
benefit plans including, but not limited to, retirement plans, supplemental
retirement plans, pension plans, profit-sharing plans, health-and-accident
plans, medical coverage or any other employee benefit plan or arrangement made
available by the Bank in the future 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. The Executive
shall be entitled to incentive compensation and bonuses as provided in any plan
of the Bank in which the Executive is eligible to participate. Nothing paid to
the Executive under any such plan or arrangement will be deemed to be in lieu of
other compensation to which the Executive is entitled under this
Agreement.
(c) In
addition to the Base Salary provided for by paragraph (a) of this Section 3 and
other compensation provided for by paragraph (b) of this Section 3, the Bank
shall pay or reimburse the Executive for (i) a monthly automobile allowance (or
in lieu of an automobile allowance, regular transportation to and from work in a
manner consistent with the transportation that has been provided) and country
club dues in such amounts as may be agreed to by the Board from time to time,
and (ii) all reasonable travel and other reasonable expenses incurred in the
performance of the Executive's obligations under this Agreement, and the Bank
may provide such additional compensation in such form and such amounts as the
Board may from time to time determine. Any such reimbursement shall
be paid promptly by the Bank and in any event no later than March 15 of the year
immediately following the year in which such expenses were
incurred.
(d) The
Executive shall be entitled to receive fees for serving as a director of the
Bank or as a member of any committee of the Board of Directors of the
Bank.
4. PAYMENTS
TO EXECUTIVE UPON AN EVENT OF TERMINATION.
(a) Upon
the occurrence of an Event of Termination (as herein defined) during the
Executive's term of employment under this Agreement, the provisions of this
Section 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
Bank of the Executive's full-time employment hereunder for any reason other than
a termination governed by Section 5(a) hereof, a termination for events governed
by Section 11 hereof, or Termination for Cause, as defined in Section 7 hereof;
or (ii) the Executive's termination for Good Reason (as defined in Section
4(a)(ii)(A) and (B) of this Agreement), which shall mean a termination based on
the following:
(A) any
material breach of this Agreement by the Bank, including without limitation any
of the following: (1) a material diminution in the Executive’s base
compensation, (2) a material diminution in the Executive’s authority, duties,
titles or
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responsibilities
as prescribed in Section 1, or (3) a material diminution in the authority,
duties or responsibilities of the officer to whom the Executive is required to
report, or
(B) any
material change in the geographic location at which the Executive must perform
his services under this Agreement;
provided,
however, that prior to any termination of employment for Good Reason, the
Executive must first provide written notice to the Bank within ninety (90) days
of the initial existence of the condition, describing the existence of such
condition, and the Bank shall thereafter have the right to remedy the condition
within thirty (30) days of the date the Bank received the written notice from
the Executive. If the Bank remedies the condition within such thirty
(30) day cure period, then no Good Reason shall be deemed to exist with respect
to such condition. If the Bank does not remedy the condition within
such thirty (30) day cure period, then the Executive may deliver a notice of
termination for Good Reason at any time within sixty (60) days following the
expiration of such cure period.
(b) Upon
the occurrence of an Event of Termination, on the Date of Termination, as
defined in Section 8, the Bank shall be obligated to pay the Executive, or, in
the event of his subsequent death, his beneficiary or beneficiaries, or his
estate, as the case may be, a lump sum cash amount within 10 business days
following the Date of Termination equal to thirty-six (36) months Base Salary;
provided,
however, that any payments pursuant to this subsection shall not, in the
aggregate, exceed three times the Executive's average taxable compensation from
the Bank for the five most recent taxable years ending prior to the year in
which the Date of Termination occurs. In the event the Bank is not in
compliance with its minimum capital requirements or if such payments pursuant to
this subsection (b) would cause the Bank's capital to be reduced below its
minimum regulatory capital requirements, such payments shall be deferred and
shall be paid within sixty (60) days after the Bank or any successor thereto is
in capital compliance. Such payments shall not be reduced in the
event the Executive obtains other employment following termination of
employment.
5. CHANGE
IN CONTROL.
(a) For
purposes of this Agreement, a “Change in Control” shall mean a change in the
ownership of the Company or the Bank, a change in the effective control of the
Company or the Bank or a change in the ownership of a substantial portion of the
assets of the Company or the Bank, in each case as provided under Section 409A
of the Code and the regulations thereunder.
(b)
If a Change in Control has occurred pursuant to Section 5(a) or the Board has
determined that a Change in Control has occurred, the Executive shall be
entitled to the benefits provided in paragraph (c) of this Section 5 upon his
subsequent termination of employment at any time during the term of this
Agreement due to: (1) the Executive's dismissal or (2) the Executive's
termination of his employment for Good Reason, unless such termination is due to
one of the events governed by Section 11 hereof or is a termination for
Cause.
(c) Upon
the Executive's entitlement to benefits pursuant to Section 5(b), the Bank shall
pay the Executive, or in the event of his subsequent death, his beneficiary or
beneficiaries,
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or his
estate, as the case may be, a lump sum cash amount within 10 business days
following the Date of Termination equal to (3) times the Executive's Base
Salary; provided
however, that any payment under this provision shall not exceed three (3)
times the Executive's average taxable compensation from the Bank for the five
most recent taxable years ending prior to the year in which the Date of
Termination occurs. In the event the Bank is not in compliance with its minimum
capital requirements or if such payments would cause the Bank's capital to be
reduced below its minimum regulatory capital requirements, such payments shall
be deferred and shall be paid within sixty (60) days after the Bank or any
successor thereto is in capital compliance. Such payments shall not
be reduced in the event the Executive obtains other employment following
termination of employment.
6. CHANGE
OF CONTROL RELATED PROVISIONS
Notwithstanding
the provisions of Section 5, in no event shall the aggregate payments or
benefits to be made or afforded to the Executive under Section 5 (the
“Termination Benefits”) constitute an “excess parachute payment” under Section
280G of the Code or any successor hereto, 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 the Executive's “base amount”, as determined in
accordance with said Section 280G. Any required reduction in the
Termination Benefits shall first be made by reducing the lump sum cash amount
payable pursuant to Section 5(c) hereof.
7. TERMINATION
FOR CAUSE.
The term
“Termination for Cause” shall mean termination because of the Executive's
personal dishonesty, incompetence, willful misconduct, any 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 material breach of any
provision of this Agreement. Notwithstanding the foregoing, the 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 a majority of
the members of the Board at a meeting of the Board called and held for that
purpose (after reasonable notice to the 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, the Executive's conduct justified a finding of
Termination for Cause and specifying the particulars thereof in
detail. The 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 hereof through the Date of Termination for Cause, stock
options and related limited rights granted to Executive under any stock option
plan shall not be exercisable, nor shall any unvested awards granted to the
Executive under any stock benefit plan of the Bank, the Company or any
subsidiary or affiliate thereof vest. At the Date of Termination for Cause, such
stock options and related limited rights and such unvested awards shall become
null and void and shall not be exercisable by or delivered to the Executive at
any time subsequent to such Termination for Cause.
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8. NOTICE.
(a) Any
purported termination by the Bank or by the Executive shall be communicated by a
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 the 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
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, 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. Notwithstanding the
pendency of any such dispute, in the event the Executive is terminated for
reasons other than Termination for Cause, the Bank will continue to pay the
Executive his Base Salary in effect when the notice giving rise to the dispute
was given until the earlier of: (1) the resolution of the dispute in accordance
with this Agreement or (2) the expiration of the remaining term of this
Agreement as determined as of the Date of Termination. Amounts paid under this
Section are in addition to all other amounts due under this Agreement and shall
not be offset against or reduce any other amounts due under this
Agreement.
9. POST-TERMINATION
OBLIGATIONS.
All
payments and benefits, except any benefits which are already vested, to the
Executive under this Agreement shall be subject to the Executive's compliance
with this Section 9 for one (1) full year after the earlier of the expiration of
this Agreement or termination of the Executive's employment with the
Bank. The Executive shall, upon reasonable notice, furnish such
information and assistance to the Bank as may reasonably be required by the Bank
in connection with any litigation in which it or any of its subsidiaries or
affiliates is, or may become, a party.
10. NON-COMPETITION
AND NON-DISCLOSURE.
(a) Upon
any termination of the Executive's employment hereunder pursuant to Section 4
hereof (other than a termination in connection with or within 12 months
following a Change in Control), the Executive agrees not to compete with the
Bank for a period of one (1) year following such termination in any city, town
or county in which the Executive's normal business office is located, except as
agreed to pursuant to a resolution duly adopted by the Board. The
Executive agrees that during such period and within said cities, towns and
counties, the
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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 Bank. The parties hereto,
recognizing that irreparable injury will result to the Bank, its business and
property in the event of the Executive's breach of this Subsection 10(a), agree
that in the event of any such breach by the Executive, the Bank will be
entitled, in addition to any other remedies and damages available, to an
injunction to restrain the violation hereof by the Executive, the Executive's
partners, agents, servants, employees and all persons acting for or under the
direction of the Executive. Nothing herein will be construed as prohibiting the
Bank from pursuing any other remedies available to the Bank for such breach or
threatened breach, including the recovery of damages from the
Executive.
(b) The
Executive recognizes and acknowledges that the knowledge of the business
activities and plans for business activities of the Bank and affiliates thereof,
as it may exist from time to time, is a valuable, special and unique asset of
the business of the Bank. The 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 Bank or affiliates thereof to any person,
firm, corporation, or other entity for any reason or purpose whatsoever.
Notwithstanding the foregoing, the 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
Bank. Further, the Executive may disclose information regarding the business
activities of the Bank to the OTS and the Federal Deposit Insurance Corporation
(“FDIC”) pursuant to a formal regulatory request. In the event of a breach or
threatened breach by the Executive of the provisions of this Section, the Bank
will be entitled to an injunction restraining the Executive from disclosing, in
whole or in part, the knowledge of the past, present, planned or considered
business activities of the Bank or affiliates thereof, or from rendering any
services to any person, firm, corporation or 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 Bank from
pursuing any other remedies available to the Bank for such breach or threatened
breach, including the recovery of damages from the Executive.
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11.
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DISABILITY,
DEATH, RETIREMENT.
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If the
Executive should become disabled or die while this Agreement is in effect, a
severance payment equal to twelve (12) months Base Salary shall be paid to the
Executive or his heirs at law, payable monthly, beginning on the first day of
the month following the month in which such event occurs. If the Executive
retires, this Agreement shall terminate and no severance payments shall be due
hereunder. The benefits provided pursuant to this Agreement shall be in addition
to any other benefits provided by the Bank.
“Disability”
shall be deemed to have occurred if the Executive: (i) is unable to engage in
any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months, or (ii) is,
by reason of any medically determinable physical or mental impairment which can
be expected to result in death or can be expected to last for a continuous
period of not less than 12 months, receiving income replacement benefits for a
period
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of not
less than three months under an accident and health plan covering employees of
the Bank and its subsidiaries and affiliates.
12. NO
DUPLICATION OF PAYMENTS.
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 the Executive under the Company Employment
Agreement, such compensation payments and benefits paid by the Company will be
subtracted from any amount due simultaneously to the Executive under similar
provisions of this Agreement. Payments pursuant to this Agreement and
the Company Employment Agreement (other than severance and change in control
payments and benefits pursuant to Sections 4 and 5 hereof) shall be allocated in
proportion to the level of activity and the time expended on such activities by
the Executive as determined by the Company and the Bank on a quarterly
basis.
13. EFFECT
ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS.
This
Agreement and the Company Employment Agreement contain the entire understanding
between the parties hereto and supersede any prior employment agreement between
the Bank or any predecessor of the Bank and the Executive, except that this
Agreement shall not affect or operate to reduce any benefit or compensation
inuring to the Executive of a kind elsewhere provided. No provision of this
Agreement shall be interpreted to mean that the Executive is subject to
receiving fewer benefits than those available to him without reference to this
Agreement.
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14.
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NO
ATTACHMENT.
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(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 effect any such action shall be null, void, and of no
effect.
(b) This
Agreement shall be binding upon, and inure to the benefit of, the Executive and
the Bank and their respective successors and assigns.
15. MODIFICATION
AND WAIVER.
(a) This
Agreement may not be modified or amended except by an instrument in writing
signed by the parties hereto; provided, however, that if the Bank determines,
after a review of the final regulations issued under Section 409A of the Code
and all applicable IRS guidance, that this Agreement should be further amended
to avoid triggering the tax and interest penalties imposed by Section 409A of
the Code, the Bank may amend this Agreement to the extent necessary to avoid
triggering the tax and interest penalties imposed by Section 409A of the
Code.
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(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 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.
16. REQUIRED
PROVISIONS.
(a) The
Bank may terminate the Executive's employment at any time, but any termination
by the Bank, other than Termination for Cause, shall not prejudice the
Executive's right to compensation or other benefits under this Agreement. The
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause as defined in Section 7
hereinabove.
(b) If
the 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.
§1818(e)(3) or (g)(1)), the Bank'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 may in its discretion: (i) pay
the Executive all or part of the compensation withheld while its contract
obligations were suspended, and (ii) reinstate (in whole or in part) any of its
obligations which were suspended.
(c) If
the 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. §1818(e)(4) or (g)(1)),
all obligations of the Bank 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. §1813(x)(1)), all obligations of the Bank 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 under this contract shall be terminated, except to the
extent determined that continuation of the contract is necessary for the
continued operation of the Bank: (i) by the Director of the OTS (or his or her
designee), 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. §1823(c)); or (ii) by
the Director of the OTS (or his or her designee) at the time the Director or his
or her 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.
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(f) Any
payments made to the Executive pursuant to this Agreement, or otherwise, are
subject to and conditioned upon compliance with 12 U.S.C. §1828(k) and 12 C.F.R.
§545.121 and any rules and regulations promulgated thereunder, including the
regulations in 12 C.F.R. Part 359.
17. REINSTATEMENT
OF BENEFITS ▇▇▇▇▇▇ SECTION 16(b).
In the
event the Executive is suspended and/or temporarily prohibited from
participating in the conduct of the Bank's affairs by a notice described in
Section 16(b) hereof (the “Notice’) during the term of this Agreement and a
Change in Control, as defined herein, occurs, the Bank will assume its
obligation to pay and the Executive will be entitled to receive all of the
termination benefits provided for under Section 5 of this Agreement upon the
Bank's receipt of a dismissal of charges in the Notice.
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18.
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SEVERABILITY.
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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.
19. 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.
20. GOVERNING
LAW.
The
validity, interpretation, performance and enforcement of this Agreement shall be
governed by the laws of the State of Nebraska, but only to the extent not
superseded by federal law.
21. 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 the Executive within fifty (50)
miles from the location of the Bank, 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 the
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, other than in the case of a
Termination for Cause.
In the
event any dispute or controversy arising under or in connection with the
Executive's termination is resolved in favor of the Executive, whether by
judgment, arbitration or
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settlement,
the 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 the Executive under this Agreement.
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22.
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PAYMENT
OF COSTS AND LEGAL FEES.
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All
reasonable costs and legal fees paid or incurred by the Executive pursuant to
any dispute or question of interpretation relating to this Agreement shall be
paid or reimbursed by the Bank if the Executive is successful on the merits
pursuant to a legal judgment, arbitration or settlement.
23. INDEMNIFICATION.
(a) The
Bank shall provide the Executive (including his heirs, executors and
administrators) with coverage under a standard directors’ and officers’
liability insurance policy at its expense, and shall indemnify the Executive
(and his heirs, executors and administrators) to the fullest extent permitted
under Nebraska 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
Bank (whether or not he continues to be a director or officer at the time of
incurring such expenses or liabilities), with such expenses and liabilities to
include, but not be limited to, judgments, court costs and attorneys’ fees and
the cost of reasonable settlements.
24. SUCCESSOR
TO THE BANK
The Bank
shall require any successor or assignee, whether direct or indirect, by
purchase, merger, consolidation or otherwise, to all or substantially all the
business or assets of the Bank, expressly and unconditionally to assume and
agree to perform the Bank’s obligations under this Agreement, in the same manner
and to the same extent that the Bank would be required to perform if no such
succession or assignment had taken place.
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SIGNATURES
IN WITNESS WHEREOF, TierOne Bank has
caused this Agreement to be executed by its duly authorized officer, and the
Executive has signed this Agreement, as of the date first written
above.
THIS
CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY THE
PARTIES.
TIERONE BANK
By: /s/ ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, Chairman of the
Board and
Chief Executive Officer
/s/ ▇▇▇▇▇
▇. ▇▇▇▇▇▇
▇▇▇▇▇ ▇.
▇▇▇▇▇▇, Executive
WITNESS:
/s/ ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
Assistant
Secretary
12