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EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of the 30th day of March, by and among SUN
BANK, N.A. (Proposed) (the "Bank"), a proposed national bank; SUN BANCSHARES,
INC., a bank holding company incorporated under the laws of the State of South
Carolina (the "Company") (collectively, the Bank and the Company are referred to
hereinafter as the "Employer"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, a resident of the State of
South Carolina (the "Executive").
RECITALS:
The Employer desires to employ the Executive as President and Chief
Executive Officer of the Bank and the President of the Company and the Executive
desires to accept such employment.
In consideration of the above premises and the mutual agreements
hereinafter set forth, the parties hereby agree as follows:
THIS AGREEMENT CONTAINS A BINDING, IRREVOCABLE AGREEMENT TO
ARBITRATE AND IS SUBJECT TO ARBITRATION PURSUANT TO TITLE 15,
CHAPTER 48 (UNIFORM ARBITRATION ACT) OF THE CODE OF LAWS OF
SOUTH CAROLINA
1. DEFINITIONS. Whenever used in this Agreement, the following terms and their
variant forms shall have the meaning set forth below:
1.1 "AGREEMENT" shall mean this Agreement and any exhibits incorporated
herein together with any amendments hereto made in the manner described in this
Agreement.
1.2 "AFFILIATE" shall mean any business entity which controls the Company, is
controlled by or is under common control with the Company.
1.3 "AREA" shall mean the geographic area within the boundaries of Horry and
Georgetown Counties, South Carolina. It is the express intent of the parties
that the Area as defined herein is the area where the Executive performs or
performed services on behalf of the Employer under this Agreement as of, or
within a reasonable time prior to, the termination of the Executive's employment
hereunder.
1.4 "BUSINESS OF THE EMPLOYER" shall mean the business conducted by the
Employer, which is the business of commercial banking.
1.5 "CAUSE" shall mean:
1.5.1 With respect to termination by the Employer:
(a) A material breach of the terms of this Agreement by the
Executive, including, without limitation, failure by the Executive to
perform his duties and
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responsibilities in the manner and to the extent required under this
Agreement, which remains uncured after the expiration of thirty (30) days
following the delivery of written notice of such breach to the Executive by
Employer. Such notice shall (i) specifically identify the duties that the
Board of Directors of either the Company or the Bank believes the Executive
has failed to perform, (ii) state the facts upon which such Board of
Directors made such determination, and (iii) be approved by a resolution
passed by two-thirds (2/3) of the directors then in office;
(b) Conduct by the Executive that amounts to fraud, dishonesty or
willful misconduct in the performance of his duties and responsibilities
hereunder;
(c) Arrest for, charged in relation to (by criminal information,
indictment or otherwise), or conviction of the Executive during the Term of
this Agreement of a crime involving breach of trust or moral turpitude;
(d) Conduct by the Executive that amounts to gross and willful
insubordination or inattention to his duties and responsibilities
hereunder; or
(e) Conduct by the Executive that results in removal from his
position as an officer or executive of Employer pursuant to a written order
by any regulatory agency with authority or jurisdiction over Employer.
1.5.2 With respect to termination by the Executive, a material diminution
in the powers, responsibilities or duties of the Executive hereunder or a
material breach of the terms of this Agreement by Employer, which remains
uncured after the expiration of thirty (30) days following the delivery of
written notice of such breach to Employer by the Executive.
1.6 "CHANGE OF CONTROL" means any one of the following events:
(a) the acquisition by any person or persons acting in concert of
the then outstanding voting securities of either the Bank or the Company,
if, after the transaction, the acquiring person (or persons) owns, controls
or holds with power to vote fifty percent (50%) or more of any class of
voting securities of either the Bank or the Company, as the case may be;
(b) within any twelve-month period (beginning on or after the
Effective Date) the persons who were directors of either the Bank or the
Company immediately before the beginning of such twelve-month period (the
"Incumbent Directors") shall cease to constitute at least a majority of
such board of directors; provided that any director who was not a director
as of the Effective Date shall be deemed to be an Incumbent Director if
that director were elected to such board of directors by, or on the
recommendation of or with the approval of, at least two-thirds of the
directors who then qualified as Incumbent Directors; and provided further
that no director whose initial assumption of office is in connection with
an actual or threatened election contest (as such terms are used in Rule
14a-11 of Regulation 14A promulgated under the Securities
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Exchange Act of 1934) relating to the election of directors shall be deemed
to be an Incumbent Director;
(c) a reorganization, merger or consolidation, with respect to
which persons who were the stockholders of the Bank or the Company, as the
case may be, immediately prior to such reorganization, merger or
consolidation do not, immediately thereafter, own more than fifty percent
(50%) of the combined voting power entitled to vote in the election of
directors of the reorganized, merged or consolidated company's then
outstanding voting securities; or
(d) the sale, transfer or assignment of all or substantially all of
the assets of the Company and its subsidiaries to any third party.
1.7 "COMPANY INFORMATION" means Confidential Information and Trade Secrets.
1.8 "CONFIDENTIAL INFORMATION" means data and information relating to the
business of the Bank or the Company (which does not rise to the status of a
Trade Secret) which is or has been disclosed to the Executive or of which the
Executive became aware as a consequence of or through the Executive's
relationship to the Employer and which has value to the Employer and is not
generally known to its competitors. Confidential Information shall not include
any data or information that has been voluntarily disclosed to the public by the
Employer (except where such public disclosure has been made by the Executive
without authorization) or that has been independently developed and disclosed by
others, or that otherwise enters the public domain through lawful means.
1.9 "DISABILITY" shall mean the inability of the Executive to perform each of
his material duties under this Agreement for the duration of the short-term
disability period under the Employer's policy then in effect as certified by a
physician chosen by the Employer and reasonably acceptable to the Executive.
1.10 "EFFECTIVE DATE" shall mean the date that the Securities and Exchange
Commission declares the Company's Registration Statement for its initial public
offering of common stock effective.
1.11 "INITIAL TERM" shall mean that period of time commencing on January 1,
2000 (the "Beginning Date") and running until the earlier of the close of
business on the last business day immediately preceding the third anniversary of
the Beginning Date or any termination of employment of the Executive under this
Agreement as provided for in Section 3.
1.12 "TERM" shall mean the Initial Term and all subsequent renewal periods.
1.13 "TRADE SECRETS" means Employer information including, but not limited
to, technical or nontechnical data, formulas, patterns, compilations, programs,
devices, methods, techniques, drawings, processes, financial data, financial
plans, product plans or lists of actual or potential customers or suppliers
which:
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(a) derives economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper means by,
other persons who can obtain economic value from its disclosure or use; and
(b) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy.
2. DUTIES.
2.1 POSITION. The Executive is employed initially as President and Chief
Executive Officer of the Bank and the President of the Company, subject to the
direction of the Board of Directors of the Bank or the Company or its
designee(s), shall perform and discharge well and faithfully the duties which
may be assigned to him from time to time by the Bank or the Company in
connection with the conduct of its business. The duties and responsibilities of
the Executive are set forth on Exhibit A attached hereto.
2.2 FULL-TIME STATUS. In addition to the duties and responsibilities
specifically assigned to the Executive pursuant to Section 2.1 hereof, the
Executive shall:
(a) devote substantially all of his time, energy and skill during
regular business hours to the performance of the duties of his employment
(reasonable vacations and reasonable absences due to illness excepted) and
faithfully and industriously perform such duties;
(b) diligently follow and implement all reasonable and lawful
management policies and decisions communicated to him by the Board of
Directors of either the Bank or the Company; and
(c) timely prepare and forward to the Board of Directors of either
the Bank or the Company all reports and accountings as may be requested of
the Executive.
2.3 PERMITTED ACTIVITIES. The Executive shall devote his entire business
time, attention and energies to the Business of the Employer and shall not
during the Term be engaged (whether or not during normal business hours) in any
other business or professional activity, whether or not such activity is pursued
for gain, profit or other pecuniary advantage; but this shall not be construed
as preventing the Executive from:
(a) investing his personal assets in businesses which (subject to
clause (b) below) are not in competition with the Business of the Employer
and which will not require any services on the part of the Executive in
their operation or affairs and in which his participation is solely that of
an investor;
(b) purchasing securities in any corporation whose securities are
regularly traded provided that such purchase shall not result in him
collectively owning beneficially at any time five percent (5%) or more of
the equity securities of any business in competition with the Business of
the Employer; and
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(c) participating in civic and professional affairs and
organizations and conferences, preparing or publishing papers or books or
teaching so long as the Board of Directors of either the Bank or the
Company approves of such activities prior to the Executive's engaging in
them.
3. TERM AND TERMINATION.
3.1 TERM. This Agreement shall remain in effect for the Initial Term. At the
end of the Initial Term and at the end of each twelve-month extension thereof,
this Agreement shall automatically be extended for a successive twelve-month
period unless either party gives written notice to the other of its intent not
to extend this Agreement with such written notice to be given not less than
sixty (60) days prior to the end of the Initial Term or such twelve-month
period. In the event such notice of non-extension is properly given, this
Agreement shall terminate at the end of the remaining term then in effect.
3.2 TERMINATION. During the Term, the employment of the Executive under this
Agreement may be terminated only as follows:
3.2.1 By the Employer:
(a) In the event that the Bank fails to receive its regulatory
charter, or the Company fails to raise the necessary capital required to
open the Bank, and should the Company's or the Bank's Board of Directors
decide to forgo future efforts to open the Bank, in which event the
Employer shall be required to continue to meet its obligation to the
Executive under Section 4.1 for six (6) months.
(b) For Cause, upon written notice to the Executive pursuant to
Section 1.5.1 hereof, where the notice has been approved by a resolution
passed by two-thirds of the directors of either the Bank or the Company
then in office in which event the Employer shall have no further obligation
to the Executive except for the payment of any amounts due and owing under
Section 4 on the effective date of termination;
(c) Without Cause at any time, provided that the Bank shall give
the Executive thirty (30) days' prior written notice of its intent to
terminate, in which event the Employer shall be required to continue to
meet its obligations to the Executive under Section 4.1 for a period equal
to the lesser of (i) six (6) months following the termination or (ii) the
remaining Term of the Agreement; or
(d) Upon the Disability of Executive at any time, provided that the
Employer shall give the Executive thirty (30) days' prior written notice of
its intent to terminate, in which event, the Employer shall be required to
continue to meet its obligations under Section 4.1 for six (6) months
following the termination or until the Executive begins receiving payments
under the Company's long-term disability policy, whichever occurs first.
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3.2.2 By the Executive:
(a) For Cause, in which event the Employer shall be required to
continue to meet its obligations under Section 4.1 for a period equal to
the lesser of (i) six (6) months following the termination or (ii) the
remaining Term of the Agreement; or
(b) Without Cause or upon the Disability of the Executive, provided
that the Executive shall give the Employer sixty (60) days' prior written
notice of his intent to terminate, in which event the Employer shall have
no further obligation to the Executive except future payment of any amounts
due and owing under Section 4 on the effective date of the termination.
3.2.3 At any time upon mutual, written agreement of the parties, in which
event the Employer shall have no further obligation to the Executive except
for the payment of any amounts due and owing under Section 4 of this
Agreement on the effective date of termination unless otherwise set forth in
the written agreement.
3.2.4 Notwithstanding anything in this Agreement to the contrary, the
Term shall end automatically upon the Executive's death, in which event the
Employer shall have no further obligation to the Executive except for the
payment of any amounts due and owing under Section 4 on the effective date
of termination.
3.3 CHANGE OF CONTROL. If the Executive terminates his employment with the
Employer under this Agreement for Cause or the Employer terminates Executive's
employment without Cause within six (6) months following a Change of Control,
the Executive, or in the event of his subsequent death, his designated
beneficiaries or his estate, as the case may be, shall receive, as liquidated
damages, in lieu of all other claims, a severance payment equal to one (1) times
the Executives then current Base Salary, to be paid in full on the last day of
the month following the date of termination. In no event shall the payment(s)
described in this Section 3.3 exceed the amount permitted by Section 280G of the
Internal Revenue Code, as amended (the "Code"). Therefore, if the aggregate
present value (determined as of the date of the Change of Control in accordance
with the provisions of Section 280G of the Code) of both the severance payment
and all other payments to the Executive in the nature of compensation which are
contingent on a change in ownership or effective control of the Bank or the
Company or in the ownership of a substantial portion of the assets of the Bank
or the Company (the "Aggregate Severance") would result in a "parachute
payment," as defined under Section 280G of the Code, then the Aggregate
Severance shall not be greater than an amount equal to 2.99 multiplied by
Executive's "base amount" for the "base period, " as those terms are defined
under Section 280G. In the event the Aggregate Severance is required to be
reduced pursuant to this Section 3.3, the Executive shall be entitled to
determine which portions of the Aggregate Severance are to be reduced so that
the Aggregate Severance satisfies the limit set forth in the preceding sentence.
Notwithstanding any provision in this Agreement, if the Executive may exercise
his right to terminate employment under this Section 3.3 or under Section
3.2.2(a), the Executive may choose which provision shall be applicable.
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3.4 EFFECT OF TERMINATION. Termination of the employment of the Executive
pursuant to Section 3.2 or Section 3.3 shall be without prejudice to any right
or claim which may have previously accrued to either the Employer or the
Executive hereunder and shall not terminate, alter, supersede or otherwise
affect the terms and covenants and the rights and duties prescribed in this
Agreement.
4. COMPENSATION. The Executive shall receive the following salary and the
benefits described in Exhibit B, attached hereto and made a part hereof:
4.1 BASE SALARY. During the Initial Term, the Executive shall be compensated
at a base rate of $7,000 per month until the opening of the Bank and $8,000 per
month after the opening of the Bank (the "Base Salary"). The Executive's Base
Salary shall be reviewed by the Board of Directors of the Bank and the Company
at least annually, and the Executive shall be entitled to receive annually an
increase in such amount, if any, as may be determined by the Board of Directors
based on its evaluation of Executive's performance. Base Salary shall be payable
in accordance with the Employer's normal payroll practices.
4.2 INCENTIVE COMPENSATION.
(a) The Executive shall be entitled to annual bonus compensation,
if any, in accordance with the terms specified in Exhibit B attached
hereto.
(b) The Executive shall also be entitled to a cash bonus of $10,000
payable immediately upon the opening of the Bank.
4.3 STOCK OPTIONS. As of the Effective Date, the Company will have
established a stock incentive plan and will grant to the Executive pursuant to
such stock incentive plan an incentive stock option to purchase, at a per share
purchase price equal to $10.00, five percent (5%) of the number of shares of the
Company's common stock. The option generally will become vested and exercisable
in 20% increments, commencing on the first anniversary of the option grant date
and continuing for the next four successive anniversaries until the option is
fully vested and exercisable. The option shall expire generally upon the earlier
of ninety (90) days following termination of employment or upon the tenth
anniversary of the option grant date. The incentive stock option will be issued
by the Employer pursuant to the Company's stock incentive plan and subject to
the terms of a related stock option agreement.
4.4 HEALTH INSURANCE.
(a) The Employer shall reimburse the Executive for the cost of
premium payments paid by the Executive for the Executive's current health
insurance covering the Executive and the members of his immediate family:
(i) until such time as the Company adopts a health insurance
plan for employees of the Company and the Bank; or
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(ii) until the Company and the Bank abandon their organizational
efforts or for twelve (12) months after the Beginning Date, whichever
occurs first.
(b) In the event of termination by the Executive For Cause (Section
3.2.3(a)) or following a Change of Control (Section 3.3), the Employer
shall reimburse Executive for the cost of premium payments paid by the
Executive to continue his then existing health insurance as provided by the
Employer for a period of six (6) months following the date of termination
of employment.
(c) In the event of a termination by the Employer Without Cause
(Section 3.2.1(c)), the Employer shall reimburse the Executive for the cost
of premium payments paid by the Executive to continue his then existing
health insurance as provided by Employer for a period of twelve (12) months
following the date of termination of employment.
4.5 AUTOMOBILE. Beginning as of the Effective Date, the Employer will provide
the Executive with an automobile to be used by the Executive for business and
personal purposes. The make and model of the automobile shall be determined by
the Employer with a value not to exceed $25,000. The Employer will pay expenses
associated with the operation, maintenance, repair and insurance for the
automobile. In addition, the automobile shall be made available by the Executive
for use by other employees of the Bank on a reasonable basis during normal
business hours of the Bank.
4.6 BUSINESS EXPENSES; MEMBERSHIPS. The Employer specifically agrees to
reimburse the Executive for:
(a) reasonable and necessary business (including travel) expenses
incurred by him in the performance of his duties hereunder not to exceed
$1,000 per month, unless otherwise approved by the Board of Directors of
either the Bank or the Company; and
(b) beginning as of the Effective Date, the dues and business
related expenditures, including initiation fees, associated with membership
in a single country club and a single civic association both as selected by
the Executive and in professional associations which are commensurate with
his position; provided, however, that the Executive shall, as a condition
of reimbursement, submit verification of the nature and amount of such
expenses in accordance with reimbursement policies from time to time
adopted by the Employer and in sufficient detail to comply with rules and
regulations promulgated by the Internal Revenue Service. In the event that
membership in the country club selected by the Executive requires the
purchase of an equity interest in such club, the Company or the Bank shall
be the owner of the equity interest and the Executive shall be the
designated member pursuant to such equity interest during the Term of this
Agreement.
4.7 VACATION. On a non-cumulative basis, the Executive shall be entitled to
four (4) weeks of vacation in each successive twelve-month period during the
Term, during which his compensation shall be paid in full.
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4.8 LIFE INSURANCE. During the Term of this Agreement, the Employer will
provide the Executive with term life insurance coverage providing a death
benefit of not less than $300,000, payable to such beneficiary or beneficiaries
as the Executive may designate.
4.9 BENEFITS. In addition to the benefits specifically described in this
Agreement, the Executive shall be entitled to such benefits as may be available
from time to time to executives of the Bank similarly situated to the Executive.
All such benefits shall be awarded and administered in accordance with the
Bank's standard policies and practices. Such benefits may include, by way of
example only, profit-sharing plans, retirement or investment funds, dental,
health, life and disability insurance benefits and such other benefits as the
Bank deems appropriate.
4.10 WITHHOLDING. The Employer may deduct from each payment of compensation
hereunder all amounts required to be deducted and withheld in accordance with
applicable federal and state income, FICA and other withholding requirements.
5. COMPANY INFORMATION.
5.1 OWNERSHIP OF COMPANY INFORMATION. All Company Information received or
developed by the Executive while employed by the Employer will remain the sole
and exclusive property of the Employer.
5.2 OBLIGATIONS OF THE EXECUTIVE. The Executive agrees:
(a) to hold Company Information in strictest confidence;
(b) not to use, duplicate, reproduce, distribute, disclose or
otherwise disseminate Company Information or any physical embodiments of
Company Information; and
(c) in any event, not to take any action causing or fail to take
any action necessary in order to prevent any Company Information from
losing its character or ceasing to qualify as Confidential Information or a
Trade Secret.
In the event that the Executive is required by law to disclose any Company
Information, the Executive will not make such disclosure unless (and then only
to the extent that) the Executive has been advised by independent legal counsel
that such disclosure is required by law and then only after prior written notice
is given to the Company when the Executive becomes aware that such disclosure
has been requested and is required by law. This Section 5 shall survive for a
period of twelve (12) months following termination of this Agreement for any
reason with respect to Confidential Information, and shall survive termination
of this Agreement for any reason for so long as is permitted by applicable law,
with respect to Trade Secrets.
5.3 DELIVERY UPON REQUEST OR TERMINATION. Upon request by the Employer, and
in any event upon termination of his employment with the Employer, the Executive
will promptly deliver to the Employer all property belonging to the Employer,
including, without limitation, all Company Information then in his possession or
control.
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6. NON-COMPETITION. The Executive agrees that during his employment by the Bank
hereunder and, in the event of his termination:
- by the Employer For Cause pursuant to Section 3.2.1(b),
- by the Executive Without Cause pursuant to Section 3.2.2(b), or
- by the Executive in connection with a Change of Control pursuant to
Section 3.3,
for a period of twelve (12) months thereafter, he will not (except on behalf of
or with the prior written consent of the Employer), within the Area, either
directly or indirectly, on his own behalf or in the service or on behalf of
others, as an executive employee or in any other capacity which involves duties
and responsibilities similar to those undertaken for the Employer (including as
an organizer or proposed executive officer of a new financial institution),
engage in any business which is the same as or essentially the same as the
Business of the Employer.
7. NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during his
employment by the Employer hereunder and, in the event of his termination:
- by the Employer For Cause pursuant to Section 3.2.1(b),
- by the Executive Without Cause pursuant to Section 3.2.2(b), or
- by the Executive in connection with a Change of Control pursuant to
Section 3.3,
for a period of twelve (12) months thereafter, he will not (except on behalf of
or with the prior written consent of the Employer), within the Area, on his own
behalf or in the service or on behalf of others, solicit, divert or appropriate
or attempt to solicit, divert or appropriate, any business from any of the
Employer's customers, including actively sought prospective customers, with whom
the Executive has or had material contact during the last two (2) years of his
employment, for purposes of providing products or services that are competitive
with those provided by the Bank.
8. NON-SOLICITATION OF EMPLOYEES. The Executive agrees that during his
employment by the Employer hereunder and, in the event of his termination:
- by the Employer For Cause pursuant to Section 3.2.1(b),
- by the Executive Without Cause pursuant to Section 3.2.2(b), or
- by the Executive in connection with a Change of Control pursuant to
Section 3.3,
for a period of twelve (12) months thereafter, he will not, within the Area, on
his own behalf or in the service or on behalf of others, solicit, recruit or
hire away or attempt to solicit, recruit or hire away, any employee of the
Employer or its Affiliates, whether or not:
- such employee is a full-time employee or a temporary employee of the
Employer or its Affiliates,
- such employment is pursuant to written agreement, and
- such employment is for a determined period or is at will.
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9. REMEDIES. The Executive agrees that the covenants contained in Sections 5
through 8 of this Agreement are of the essence of this Agreement; that each of
the covenants is reasonable and necessary to protect the business, interests and
properties of the Employer, and that irreparable loss and damage will be
suffered by the Employer should he breach any of the covenants. Therefore, the
Executive agrees and consents that, in addition to all the remedies provided by
law or in equity, the Employer shall be entitled to a temporary restraining
order and temporary and permanent injunctions to prevent a breach or
contemplated breach of any of the covenants. The Employer and the Executive
agree that all remedies available to the Employer or the Executive, as
applicable, shall be cumulative.
10. SEVERABILITY. The parties agree that each of the provisions included in this
Agreement is separate, distinct and severable from the other provisions of this
Agreement and that the invalidity or unenforceability of any Agreement provision
shall not affect the validity or enforceability of any other provision of this
Agreement. Further, if any provision of this Agreement is ruled invalid or
unenforceable by a court of competent jurisdiction because of a conflict between
the provision and any applicable law or public policy, the provision shall be
redrawn to make the provision consistent with and valid and enforceable under
the law or public policy.
11. NO SET-OFF BY THE EXECUTIVE. The existence of any claim, demand, action or
cause of action by the Executive against the Employer, or any Affiliate of the
Employer, whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Employer of any of its rights
hereunder.
12. NOTICE. All notices and other communications required or permitted under
this Agreement shall be in writing and, if mailed by prepaid first-class mail or
certified mail, return receipt requested, shall be deemed to have been received
on the earlier of the date shown on the receipt or three (3) business days after
the postmarked date thereof. In addition, notices hereunder may be delivered by
hand or overnight courier, in which event the notice shall be deemed effective
when delivered. All notices and other communications under this Agreement shall
be given to the parties hereto at the following addresses:
(i) If to the Employer, to it at:
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(ii) If to the Executive, to him at:
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13. ASSIGNMENT. Neither party hereto may assign or delegate this Agreement or
any of its rights and obligations hereunder without the written consent of the
other party to this Agreement.
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14. WAIVER. A waiver by one party to this Agreement of any breach of this
Agreement by the other party to this Agreement shall not be effective unless in
writing, and no waiver shall operate or be construed as a waiver of the same or
another breach on a subsequent occasion.
15. ARBITRATION. Any controversy or claim arising out of or relating to this
contract, or the breach thereof, shall be settled by binding arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association. Judgment upon the award rendered by the arbitrator may be entered
only in the State Court of Georgetown County or the federal court for the
District of South Carolina. The Employer and the Executive agree to share
equally the fees and expenses associated with the arbitration proceedings.
16. ATTORNEYS' FEES. In the event that the parties have complied with this
Agreement with respect to arbitration of disputes and litigation ensues between
the parties concerning the enforcement of an arbitration award, the party
prevailing in such litigation shall be entitled to receive from the other party
all reasonable costs and expenses, including without limitation attorneys' fees,
incurred by the prevailing party in connection with such litigation, and the
other party shall pay such costs and expenses to the prevailing party promptly
upon demand by the prevailing party.
17. APPLICABLE LAW. This Agreement shall be construed and enforced under and in
accordance with the laws of the State of South Carolina.
18. INTERPRETATION. Words importing any gender include all genders. Words
importing the singular form shall include the plural and vice versa. The terms
"herein", "hereunder", "hereby", "hereto", "hereof" and any similar terms refer
to this Agreement. Any captions, titles or headings preceding the text of any
article, section or subsection herein are solely for convenience of reference
and shall not constitute part of this Agreement or affect its meaning,
construction or effect.
19. ENTIRE AGREEMENT. This Agreement embodies the entire and final agreement of
the parties on the subject matter stated in this Agreement. No amendment or
modification of this Agreement shall be valid or binding upon the Bank or the
Executive unless made in writing and signed by both parties. All prior
understandings and agreements relating to the subject matter of this Agreement
are hereby expressly terminated.
20. RIGHTS OF THIRD PARTIES. Nothing herein expressed is intended to or shall be
construed to confer upon or give to any person, firm or other entity, other than
the parties hereto and their permitted assigns, any rights or remedies under or
by reason of this Agreement.
21. SURVIVAL. The obligations of the Executive pursuant to Sections 5, 6, 7, 8
and 9 shall survive the termination of the employment of the Executive hereunder
for the period designated under each of those respective sections.
22. JOINT AND SEVERAL. The obligations of the Bank and the Company to Executive
hereunder shall be joint and several.
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IN WITNESS WHEREOF, the Employer and the Executive have executed and
delivered this Agreement as of the date first shown above.
THE BANK:
SUN BANK, N.A. (PROPOSED)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Title: Chairman of the Board
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THE COMPANY:
SUN BANCSHARES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Title: Chief Executive Officer
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THE EXECUTIVE:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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EXHIBIT A
INITIAL DUTIES OF THE EXECUTIVE
The initial duties of the Executive shall include, in addition to any other
duties assigned the Executive by the Board of Directors of the Bank or the
Company or their respective designees, the following:
- ▇▇▇▇▇▇ a corporate culture that promotes ethical practices, encourages
individual integrity, fulfills social responsibility, and is conducive to
attracting, retaining and motivating a diverse group of top-quality
employees at all levels.
- Work with the Board of Directors to develop a long-term strategy for the
Company that creates shareholder value.
- Develop and recommend to the Board annual business plans and budgets that
support the Company's long-term strategy.
- Manage the day-to-day business affairs of the Company appropriately.
- Use best efforts to achieve the Company's financial and operating goals
and objectives.
- Use best efforts to improve the quality and value of the products and
services provided by the Company.
- Use best efforts to ensure that the Company maintains a satisfactory
competitive position within its industry.
- Develop an effective management team and an active plan for its
development and succession, and make recommendations to the Board
regarding hiring, firing and compensation.
- Implement major corporate policies.
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EXHIBIT B
Within ninety (90) days following the end of each calendar year of the
Employer's operations, the Employer shall pay the Executive a cash bonus equal
to five percent (5%) of the Employer's consolidated pre-tax earnings for that
calendar year, but, in no event, shall such bonus amount exceed an amount equal
to one-hundred percent (100%) of Executive's Base Salary for the calendar year
for which the bonus is paid. Notwithstanding the foregoing, the bonus payments
contemplated by this Exhibit B shall not become due and payable until the Board
of Directors of the Bank has determined, according to reasonable safety and
soundness standards, that:
- The Bank is and after the payment of any bonus will continue to be "well
capitalized" under the capital adequacy guidelines issued by its primary
banking regulator;
- The Bank is not subject to any regulatory actions (i.e., a Memorandum of
Understanding or Cease and Desist Order);
- The Capital, Management, Asset, and Liquidity components of the Bank's
CAMELS rating are "2" or better and the Bank receives an overall CAMELS
rating of "2" or better from its primary banking regulator;
- The Bank's loan loss reserve is adequate and loan portfolio quality is
satisfactory based on the board of directors review of (1) the most recent
report of exam of the Bank's primary banking regulator; (2) the audit
report of the Company's independent auditors for the calendar year then
ended; and (3) any other internally prepared credit review(s) that the
board of directors deem necessary and appropriate; and
- The overall financial condition of the Bank, including asset quality, is
satisfactory and will not be adversely affected by the payment of any
bonus. The overall financial condition shall be presumed to be
unsatisfactory if the Bank's average loans past due greater than 90 days
as a percent of total average loans (the "Past Due Ratio") for the
calendar year then ended exceeds the average Past Due Ratio for the Bank's
pier group by greater than 0.25%.