EMPLOYMENT AGREEMENT BY AND BETWEEN THE JACKSONVILLE BANK AND VALERIE A. KENDALL
EXHIBIT 10.1
BY
AND BETWEEN
THE
JACKSONVILLE BANK
AND
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
THIS
EMPLOYMENT AGREEMENT ("Agreement"), by and between The Jacksonville Bank, (the
"Bank") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ("Employee" and, together with the Bank, the
“Parties”), is dated and shall be effective this 13th day of May,
2009 (the “Effective Date”). It replaces and supersedes any and all
previous agreements, written or oral, with respect to the Employee’s employment
with the Bank.
RECITALS
WHEREAS,
the Bank wishes to retain Employee as its Chief Financial Officer to perform the
duties and responsibilities as are described in this Agreement and as the Bank's
Board of Directors (the "Board") may assign to Employee from time to time;
and
WHEREAS,
Employee desires to be employed by the Bank and to serve as the Bank's Chief
Financial Officer in accordance with the terms and provisions of this
Agreement.
NOW,
THEREFORE, in consideration of the mutual agreements contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereto represent, warrant, undertake, covenant and
agree as follows:
OPERATIVE
TERMS
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1.
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Employment and
Term. The Bank shall employ Employee pursuant to the
terms of this Agreement to perform the services specified in Section 2
herein. The initial term of employment shall be for a period of twelve
(12) months, commencing on the Effective Date. Upon each new day of the
twelve (12) month period of employment from the Effective Date until the
Employee's 65th (sixty-fifth) birthday, the term of this Agreement shall
be automatically extended for one (1) additional day, to be added to the
end of the then-existing twelve (12) month term. Accordingly, at all times
prior to (i) the Employee's attaining age sixty-five (65) or (ii) a Notice
of Termination, as defined in Section 9(b) (or an actual termination) the
term of this Agreement shall be twelve (12) full months. However, either
Party may terminate this Agreement by giving the other Party written
notice of intent not to renew. The automatic extensions of the term of
this Agreement shall immediately be suspended upon an employment
termination by reason of death or disability or retirement, or an
employment termination made voluntarily by the Employee (other than for
Good Reason as defined in Section 9(d), or involuntarily for Just Cause as
defined in Section 9(b)). Additionally, the Board shall, on an annual
basis, review Employee's performance to determine whether this Agreement
should continue to be extended. The Board's action will be reflected in
the Board's meeting minutes.
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In the
event the Employee gives a Notice of Termination, the term of this Agreement
shall expire upon the thirtieth (30th) day following the delivery to the Bank of
such Notice of Termination. Except as otherwise provided in the following
paragraph with respect to a voluntary termination for Good Reason, a voluntary
employment termination by the Employee shall result in the termination of the
rights and obligations of the parties under this Agreement; provided, however,
that the terms and provisions of Section 12 shall continue to
apply.
In the
event the Bank desires to involuntarily terminate the employment of Employee
(for purposes of this Agreement, a voluntary employment termination by the
Employee for Good Reason shall be treated as an involuntary termination of the
Employee's employment without Just Cause), the Bank shall deliver to the
Employee a Notice of Termination, and the following provisions shall
apply:
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(a)
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In
the event the involuntary termination is for Just Cause, this Agreement
shall terminate immediately upon delivery to the Employee of such Notice
of Termination. Such a termination for Just Cause shall result
in the termination of all rights and obligations of the Parties under this
Agreement.
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(b)
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In
the event the involuntary termination is without Just Cause, the Employee
shall be entitled to receive the severance benefits set forth in Sections
9(f) and 9(g) herein.
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2.
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Position, Responsibilities and
Duties. During the term of this Agreement, Employee
shall serve in the following capacities and shall fulfill the following
responsibilities and duties:
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(a)
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Specific
Duties: Employee shall serve as the Bank's Chief Financial
Officer or in such other position as shall be designated by the Board of
Directors in its sole discretion. In such capacity, Employee
shall have the same powers, duties and responsibilities of supervision and
management of the Bank usually accorded to Chief Financial Officers of
similar financial institutions. In addition, Employee shall use
her best efforts to perform the duties and responsibilities enumerated in
this Agreement and any other duties assigned to Employee by the Board and
to utilize and develop contacts and customers to enhance the business of
the Bank. Specifically, Employee shall devote her full business
time and attention and use her best efforts to accomplish and fulfill the
following duties and responsibilities, as well as other duties assigned to
Employee from time to time by the
Board:
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(i)
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serve
as the Chief Financial Officer of the
Bank;
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(ii)
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perform
such executive services for the Bank as may be consistent with her titles
or be assigned to her by the Board;
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(iii)
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serve
on such committees as appointed by the Board from time to
time;
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(iv)
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keep
the other executives of the Bank and the Board informed of important
developments concerning the Bank's activities, industry developments and
regulatory initiatives affecting the
Bank;
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(v)
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maintain
adequate expense records relating to Employee's activities on behalf of
the Bank;
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(vi)
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coordinate
with the Bank's other executives to the extent necessary to further the
business of the Bank, keeping in compliance with government laws and
regulations and otherwise keeping the Bank in as good a financial and
legal posture as possible; and
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(vii)
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conduct
and undertake all other activities, responsibilities, and duties normally
expected to be undertaken and accomplished by a Chief Financial Officer of
a financial institution similar in scope and operation to the Bank's
business.
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(viii)
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any
additional duties specific to Chief Financial
Officer.
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(b)
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General
Duties: During the term of this Agreement, and except for
illness, vacation periods and leaves of absences, Employee shall devote
all of her working time, attention, skill and best efforts to accomplish
and faithfully perform all of the duties assigned to Employee on a
full-time basis. Employee shall, at all times, conduct herself
in a manner that will reflect positively upon the
Bank. Employee shall obtain such licenses, certificates,
accreditations and professional memberships and designations as the Bank
may reasonably require. Employee shall join and maintain
membership in such social and civic organizations as Employee or the Board
deems appropriate to ▇▇▇▇▇▇ the Bank's contacts and business network in
the community.
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3.
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Compensation. During
the term of this Agreement, Employee shall be compensated as
follows:
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(a)
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Base
Salary: Employee shall receive an annual salary of $145,000
(the "Base Salary") in equal installments, in accordance with the Bank's
standard payroll practices, reduced appropriately by deductions for
federal income withholding taxes, social security taxes and other
deductions required by applicable laws. The Bank will in good
faith review the Employee's Base Salary on an annual basis. In
no event, however, will the Base Salary be reduced without Employee's
written concurrence.
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(b)
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Incentive
Compensation and Bonus: Employee shall be entitled to receive
such incentive compensation and bonuses as may be determined from time to
time by the Board of Directors.
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(c)
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Stock
and Other Benefit Plans: During the term of this Agreement, the
Employee will be entitled to participate in and receive the benefits of
any stock option plans, stock ownership plans, profit-sharing plans,
401(k) plans, or other plans, benefits and privileges given to employees
and executives of the Bank which are currently in effect at the execution
of this Agreement, or which may come into existence thereafter, to the
extent the Employee is otherwise eligible and qualifies to so participate
in and receive such benefits or privileges. The Bank shall not
make any changes in such plans, benefits or privileges which would
adversely affect the Employee's rights or benefits thereunder, unless such
change occurs pursuant to a program applicable to all executive officers
(Vice President or above) of the Bank and does not result in a
proportionately greater adverse change in the rights of or benefits to the
Employee as compared with any other executive officer of the
Bank. Nothing paid to the Employee under any plan or
arrangement presently in effect or made available in the future shall be
deemed to be in lieu of the Base Salary payable to the Employee pursuant
to this Section 3.
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4.
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Payment of Business
Expenses. Employee is authorized to incur reasonable
expenses in performing her duties. The Bank will reimburse
Employee for authorized expenses, according to the Bank's established
policies, promptly after Employee's presentation of an itemized account of
such expenditures.
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5.
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Vacation and
Perquisites. Employee will be entitled to paid vacation
time each year pursuant to the Bank's policy as it may be revised from
time to time. The Employee shall receive the use of an
automobile or an automobile allowance on terms determined of the Board of
Directors from time to time.
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6.
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Medical
Benefits. Employee is entitled to participate in all
medical and health care benefit plans through health insurance, corporate
funds, medical reimbursement plans or other plans, if any, provided, or to
be provided, by the Bank for its
employees.
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7.
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Disability/Illness.
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(a)
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Illness: Employee
shall be paid her full Base Salary for any period of her illness or
incapacity: provided that such illness or incapacity does not render
Employee unable to perform her duties under this Agreement for a period
longer than three (3) consecutive months. At the end of such
three (3) month period, the Bank may terminate Employee's employment and
this Agreement.
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(b)
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Disability: If
the Bank terminates this Agreement pursuant to Employee's disability as
determined under Section 7(a) herein, the Bank shall pay to Employee, as a
disability payment, an amount equal to Employee's monthly Base Salary,
payable in substantially equal semi-monthly installments on the fifteenth
and last days of each month, commencing on the effective date of
Employee's separation from service and ending on the earlier
of:
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(i)
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the
date Employee returns to full time employment in her capacity as the
Bank's Chief Financial Officer;
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(ii)
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Employee's
full time employment by another
employer;
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(iii)
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three
(3) months after the date of such separation, after which Employee will be
entitled to receive benefits under any disability insurance plan provided
by the Bank; or
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(iv)
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the
date of Employee's death.
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(v)
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The
Bank may satisfy its obligations under this Section of this Agreement, at
its option, through the purchase of disability insurance. The
provisions of such policy will control the amounts paid to
Employee. Such disability insurance will be coordinated with
any disability plans made available to Employee pursuant to Section 6 of
this Agreement.
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(c)
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Continuation
of Coverages: During any period of illness or disability, the
Bank will continue any other life, health and disability coverages for
Employee substantially identical to the coverages maintained prior to
Employee's separation from service on account of
disability. Such coverages shall cease upon the earlier
of:
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(i)
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Employee's
full time employment by another
employer;
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(ii)
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one
(1) year after the date of such separation (with the exception of
disability insurance coverage); or
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(iii)
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the
date of Employee's death.
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(d)
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No
Reduction in Base Salary: During the period in which Employee
is disabled or subject to illness or incapacity, other than as described
in Section 7(b) herein, there shall be no reduction in Employee's Base
Salary.
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8.
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Death During
Employment. In the event of Employee's death during the
term of this Agreement, the Bank's obligation to Employee shall be limited
to the portion of Employee's compensation which would be payable up to the
first working day of the first month after Employee's death, except that
any compensation payable to Employee under any benefit plan maintained by
the Bank will be paid pursuant to its
terms.
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9.
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Termination.
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(a)
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Illness,
Incapacity or Death: This Agreement shall terminate upon
Employee's illness, incapacity or death in accordance with the provisions
of Sections 7 and 8 herein.
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(b)
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Termination
for Just Cause: The Bank shall have the right, at any time,
upon prior written Notice of Termination satisfying the requirements of
Section 10 herein, to terminate the Employee's employment hereunder,
including termination for Just Cause. For the purpose of this
Agreement, termination for Just Cause shall mean termination for personal
dishonesty, willful misconduct, material breach of fiduciary duty,
continuing failure, after notice, to satisfactorily perform the duties
stated in this Agreement, violation of any law, rule or regulation (other
than traffic violations or misdemeanors not related to theft or
dishonesty, or that would not reflect poorly on the Bank), violation of a
final cease-and-desist order, negligence or misconduct in the performance
of Employee’s duties or material breach of any provision of this
Agreement. In the event Employee is terminated for Just Cause,
Employee shall have no right to compensation or other benefits for any
period after such date of
termination.
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(c)
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Involuntary
Termination: If the Employee is terminated by the Bank other
than for Just Cause or in connection with a Change In Control (as defined
in Section 9(e) herein), Employee's right to compensation and other
benefits under this Agreement shall be as set forth in Sections 9(f)(i)
and 9(g) herein. In the event the Employee is terminated by the
Bank in connection with a Change In Control, Employee's right to
compensation and other benefits under this Agreement shall be as set forth
in Section 9(f)(ii) and 9(g)
herein.
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(d)
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Termination
for Good Reason: Employee may terminate her employment
hereunder for Good Reason. For purposes of this Agreement, Good
Reason shall mean (i) a failure by the Bank to comply with any material
provision of this Agreement, which failure has not been cured within ten
(10) days after a notice of such noncompliance has been given by the
Employee to the Bank; or (ii) subsequent to a Change In Control as defined
in Section 9(e) herein and without the Employee's express written consent,
any of the following shall occur: the assignment to the
Employee of any duties inconsistent with the Employee's positions, duties,
responsibilities and status with the Bank immediately prior to a Change In
Control; a change in the Employee's reporting responsibilities, titles or
offices as in effect immediately prior to a Change In Control; any removal
of the Employee from, or any failure to re-elect the Employee to, any of
such positions, except in connection with a termination of
employment for Just Cause, disability, death, or removal pursuant to
Sections 9(a) or 9(b) herein; a reduction by the Bank in the Employee's
annual salary as in effect immediately prior to a Change In
Control; the failure of the Bank to continue in effect any bonus, benefit
or compensation plan, life insurance plan, health and accident plan or
disability plan in which the Employee is participating at the time of a
Change In Control, or the taking of any action by the Bank which would
adversely affect the Employee's participation in or materially reduce the
Employee's benefits under any of such plans, or the transfer of the
Employee to any location outside of ▇▇▇▇▇ or Clay Counties, Florida or the
assignment of substantial duties to the Employee to be completed outside
▇▇▇▇▇, St. ▇▇▇▇▇ or Clay Counties,
Florida.
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Notwithstanding
anything in this Section 9(d) to the contrary, any of the above-listed events
which does not constitute a “material negative change” (as defined in Section
1.409A-1(n)(2) of the Treasury Regulations) in the Employee’s service
relationship with the Bank shall not constitute “Good Reason” for purposes of
this Agreement.
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(e)
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Change
In Control: The Bank is a wholly-owned subsidiary of
Jacksonville Bancorp, Inc. (the "Parent Company"). For purposes
of this Agreement, a Change in Control shall mean, and be deemed to have
occurred on the date of, the first to occur of any of the
following:
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(i)
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the
sale by the Parent Company of capital stock (other than an initial public
offering of stock) such that any person (as such term is used in
Rule 13d-5 of the Exchange Act) or group (as defined in Sections
3(a)(9) and 13(d)(3) of the Exchange Act) other than (1) a subsidiary of
the Parent Company or any employee benefit plan (or any related trust) of
the Parent Company or subsidiary, or (2) any current holder of five
percent (5%) or more of the Parent Company's capital stock, becomes the
owner (beneficially or otherwise) of more than fifty percent (50%) of such
Parent Company's capital stock or other securities representing fifty
percent (50%) or more of the combined voting power of outstanding voting
securities;
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(ii)
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the
replacement of more than fifty percent (50%) of the incumbent members of
the Board of Directors of the Parent Company provided, however, where the
election or nomination of such replacement directors was approved by a
majority of the incumbent members (other than in connection with an
"election contest") (as such term is used in Section 14(d) of the Exchange
Act) or proposed merger) such replacement director will be treated as an
incumbent director;
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(iii)
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the
Parent Company becomes a subsidiary of another corporation or shall have
merged into or consolidated with another corporation, or merged another
corporation into the Parent Company, on a basis whereby less than fifty
percent (50%) of the total voting power of the surviving corporation is
represented by shares held by former shareholders of the Parent Company
prior to such merger or consolidation excluding, however, a transaction
where the incumbent directors of the Parent Company constitute a majority
of the Board of Directors of the surviving corporation at the time of the
transaction and for one (1) year thereafter;
or
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(iv)
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the
Parent Company sells the capital stock of the Bank or all or substantially
all of its assets to another corporation or other entity or person not
also controlled by the shareholders of the Parent
Company.
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Notwithstanding
anything in this Section 9(e) to the contrary, an event which does not
constitute a change in the ownership, a change in the effective control, or a
change in the ownership of a substantial portion of the assets of the Bank or
the Parent Company, each as defined in Section 1.409A-3(i)(5) of the Treasury
Regulations, shall not constitute a Change in Control for purposes of this
Agreement.
(f) Severance
Payment:
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(i)
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if
the Employee shall terminate her employment for Good Reason as defined in
Section 9(d) herein, or if the Employee is terminated by the Bank for
other than Just Cause pursuant to Section 9(c) herein, then in lieu of any
further salary payments to the Employee for periods subsequent to the date
of termination, the Employee shall be paid, as severance, an amount equal
to Employee's annual Base Salary, plus any incentive compensation or bonus
which the Employee would have been entitled to hereunder;
or
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(ii)
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in
the event Employee's employment is terminated as a result of a Change In
Control or a Change In Control occurs within twelve (12) months before the
Employee's involuntary termination or termination for Good Reason,
Employee shall be paid, within ten (10) days following the effective date
of her separation from service, a severance payment equal to 2.99 times
the highest annual salary and bonus she was paid or entitled to in the two
years preceding termination.
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Any
payment under Subsection 9(f)(i) shall be made in substantially equal
semi-monthly installments on the fifteenth and last days of each month
commencing on the effective date of Employee's separation from
service. Payments under Subsection 9(f)(i) shall be made over a
twelve month period.
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(g)
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Additional
Severance Benefits: Unless the Employee is terminated for Just Cause
pursuant to Section 9(b) herein, pursuant to Section 10(b) herein, or
pursuant to a termination of employment by the Employee for other than
Good Reason, the Bank shall maintain in full force and effect, for the
continued benefit of the Employee for the remaining term of this
Agreement, or twelve (12) months (whichever is longer), all employee
benefit plans and programs in which the Employee was entitled to
participate immediately prior to the date of her separation from service;
provided, however, that the Employee's continued participation is possible
under the general terms and provisions of such plans and
programs.
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(h)
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Mitigation: Employee
shall not be required to mitigate the amount of any payment provided for
in Sections 9(f) and 9(g) of this Agreement by seeking other employment or
otherwise.
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(i)
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Schedule
of Payments for Additional Benefits: To the extent any
additional benefits payable to Employee under Section 9(g) above or any
other provision of this Agreement (other than separation pay as described
in Section 9(f) above), other than benefits that are (i) excludable from
the Employee’s gross income, (ii) deductible business expenses, (iii)
medical expenses that would be deductible under Section 213(d) of the Code
(without regard to the 7.5% threshold for deductibility), or that (iv) do
not in the aggregate (including any other additional post-termination
benefits payable to Employee under this Agreement or any other
arrangement) exceed the applicable dollar limit under Section 402(g)(1)(B)
of the Code for the year in which the Employee’s separation from service
occurs or (v) are not otherwise exempt from the requirements of Section
409A of the Code (the amounts described in (i), (ii), (iii), (iv) and (v)
referred to in Section 2(j) below as the “Exempt Additional Benefits”),
the payment of such benefits shall be made in accordance with Section
1.409A-3(i)(1)(iv) of the Treasury
Regulations.
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(j)
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Six
Month Delay: Notwithstanding anything in this Agreement to the
contrary, if at the time of Employee’s separation from service the shares
of the Bank or any member of the Bank Controlled Group are publicly traded
on an established securities market or otherwise, then, to the extent
necessary to comply with Section 409A of the Code, any amounts otherwise
payable to the Employee under this Agreement (other than Exempt Additional
Benefits) during the first six months following Employee’s separation from
service shall be withheld and paid instead in a single lump sum cash
payment as soon as administratively practicable (but in any event within
90 days) following the earlier of (i) the date which is six (6) months
after the Employee’s separation from service and (ii) the date of the
Employee’s death following her separation from service, and not
before. Amounts otherwise payable after this six-month period
shall be paid in accordance with the terms of the Agreement without regard
to this subsection (j). This subsection (j) shall apply only if
the Employee is a “Specified Employee” at the time of her separation from
service. For purposes of this subsection (j), a “Specified
Employee” is any “key employee” (as defined in Section 416(i) of the Code,
without regard to subparagraph (5) thereof) within the Bank Controlled
Group determined in accordance with procedures established by the Parent
Company in accordance with Section 1.409A-1(i) of the Treasury Regulations
(or, in the absence of such procedures, determined in accordance with
Section 1.409A-1(i) of the Treasury Regulations applying the default terms
thereof); and the “Bank Controlled Group” is the Bank and all persons with
whom the Bank would be considered a single employer under Sections 414(b)
or (c) of the Code.
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10.
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Notice of
Termination.
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(a)
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Employee's
Notice: Employee shall have the right, upon prior written
notice of termination of not less than thirty (30) days, to terminate her
employment hereunder. In such event, Employee shall have no
right after the date of termination to compensation or other benefits as
provided in this Agreement, unless such termination is for Good
Reason, as defined in Section 9(d) herein. If the Employee
provides a Notice of Termination for Good Reason, the date of termination
shall be the date on which the Notice of Termination is
given.
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(b)
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Specificity: Any
termination of the Employee's employment by the Bank or by Employee shall
be communicated by written Notice of Termination to the other Party
hereto. For purposes of this Agreement, a Notice of Termination
shall mean a dated notice which shall: (i) indicate the
specific termination provision in the Agreement relied upon; (ii) set
forth in reasonable detail the facts and circumstances claimed to provide
a basis for termination of the Employee's employment under the provision
so indicated; and (iii) set forth the date of termination, which shall be
not less than thirty (30) days nor more than forty-five (45) days after
such Notice of Termination is given, except in the case of the Bank's
termination of the Employee's employment for Just Cause, in which case
date of termination shall be the date such Notice of Termination is
given.
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(c)
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Delivery
of Notices: All notices given or required to be given herein
shall be in writing, sent by United States first-class certified or
registered mail, postage prepaid, by way of overnight carrier or by hand
delivery. If to the Employee (or to the Employee's spouse or
estate upon the Employee's death) notice shall be sent to Employee's
last-known address, and if to the Bank, notice shall be sent to the
corporate headquarters. All such notices shall be effective
when deposited in the mail if sent via first-class certified or registered
mail, or upon delivery if by hand delivery or sent via overnight
carrier. Either Party, by notice in writing, may change or
designate the place for receipt of all such
notices.
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11.
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Post-Termination
Obligations. The Bank shall pay to Employee such
compensation as is required pursuant to this Agreement; provided, however,
any such payment shall be subject to Employee's post-termination
cooperation. Such cooperation shall include the
following:
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(i)
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Employee
shall furnish such information and assistance as may be reasonably
required by the Bank in connection with any litigation or settlement of
any dispute between the Bank, a borrower and/or any other third parties
(including without limitation serving as a witness in court or other
proceedings);
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(ii)
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Employee
shall provide such information or assistance to the Bank in connection
with any regulatory examination by any state or federal regulatory agency;
and
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(iii)
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Employee
shall keep the Bank's trade secrets and other proprietary or confidential
information secret to the fullest extent practicable, subject to
compliance with all applicable
laws.
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Upon
submission of proper receipts, the Bank shall promptly reimburse Employee for
any reasonable expenses in current by Employee in complying with the provisions
of this Section. Such cooperation is to be furnished without
additional compensation during such period Employee is receiving severance
payments pursuant to this Agreement. Should such cooperation be
required during such period that Employee is not receiving severance payments
pursuant to this Agreement, the Bank shall pay Employee an hourly fee comparable
to that charged by banking industry consultants. Amounts payable to
Employee pursuant to this paragraph shall be considered “additional benefits”
for purposes of Section 9(i) above.
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12.
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Attorneys’ Fees/Advanced
Costs. In the event that the Employee is terminated in a
manner which violates any provisions of this Agreement, as determined by a
court of competent jurisdiction, the Employee shall be entitled to
reimbursement for all reasonable costs, including attorneys’ fees, in
challenging such termination. Further, because of economic
disparity between the Bank and Employee, the Bank agrees to pay for
Employee's reasonable attorneys' fees and costs up to $10,000 to enforce
the terms of this Agreement or recovered damages for breach of this
agreement as follows: $5,000 at the commencement of litigation
or the mediation proceedings and an additional $5,000 six (6) months
thereafter. In the event the Employee is unsuccessful in her
claim or defense, the Employee shall reimburse the Bank for any attorneys'
fees, expenses and costs that have been advanced. If the
Employee is successful, any attorneys' fee award will be reduced by the
amount of attorney's fees and costs that have been
advanced. Such reimbursement shall be in addition to all rights
to which the Employee is otherwise entitled under this
Agreement. Amounts payable to Employee pursuant to this
paragraph shall be considered “additional benefits” for purposes of
Section 9(i) above.
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13.
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Indebtedness. If
during the term of this Agreement, Employee becomes indebted to the Bank
for any reason, the Bank may, at its election, set off and collect any
sums due Employee out of any amounts which the Bank may owe Employee from
her Base Salary or other compensation; provided, however, that the Bank
shall not reduce any post-termination amounts payable to Employee under
this Agreement that are subject to Section 409A of the Code (including any
severance pay described in Section 2(f) that is subject to Section 409A of
the Code) in offset of an Employee indebtedness to the Bank unless the
indebtedness arose in the ordinary course of the Employee’s service
relationship with the Bank, the amount of the reduction does not
exceed $5,000, and the reduction is made at the same time an in
the same amount as the debt otherwise would have been due and collected
from the Employee. Furthermore, upon the termination of this
Agreement, all sums owed by Employee shall become immediately due and
payable. Employee shall pay all expenses and attorney's fees
actually or necessarily incurred by the Bank in connection with any
collection proceeding for Employee's indebtedness to
us. Notwithstanding any of the foregoing, any indebtedness to
us secured by a mortgage on Employee's residence shall not be subject to
the foregoing provisions, and shall be governed by the loan documents
evidencing such indebtedness.
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14.
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Maintenance of Trade Secrets
and Confidential Information. Employee shall use her
best efforts and utmost diligence to guard and protect all of the Bank's
trade secrets and confidential information. Employee shall not,
either during the term or after termination of this Agreement, for
whatever reason, use, in any capacity, or divulge or disclose in any
manner, to any Person, the identity of the Bank's customers, or its
customer lists, methods of operation, marketing and promotional methods,
processes, techniques, systems, formulas, programs or other trade secrets
or confidential information relating to the Bank's
business. Upon termination of this Agreement or Employee's
employment, for any reason, Employee shall immediately return and deliver
to the Bank all records and papers and all matters of whatever nature
which bear trade secrets or confidential information relating to the
Bank.
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11
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15.
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Competitive
Activities.
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(a)
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Limitation
on Outside Activities: Employee agrees that during the term of
this Agreement, except with the express consent of the Board, Employee
will not, directly or indirectly, engage or participate in, become a
director of, or render advisory or other services for, or in connection
with, or become interested in, or make any financial investment in any
firm, corporation, business entity or business enterprise competitive with
or to any business of the Bank; provided, however, that Employee shall not
be precluded or prohibited from owning passive investments, including
investments in the securities of other financial institutions, so long as
such ownership does not require Employee to devote substantial time to
management or control of the business or activities in which Employee has
invested.
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(b)
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Agreement
Not to Compete: Employee acknowledges that by virtue of her
employment with the Bank, Employee will acquire an intimate knowledge of
the activities and affairs of the Bank, including trade secrets and other
confidential matters. Employee, therefore, agrees that during
the term of this Agreement, and for a period of twelve (12) months after
the termination of her employment for any reason, Employee shall not
become employed, directly or indirectly, whether as an employee,
independent contractor, consultant, or otherwise, in the financial
services industry with any business enterprise or business entity, or
person whose intent is to organize another financial institution in ▇▇▇▇▇
or Clay Counties, Florida; provided, however, that such prohibition shall
be for three (3) months if this Agreement is terminated due to a Change In
Control. Employee hereby agrees that the duration of the
anticompetitive covenant set forth herein is reasonable, and its
geographic scope is not unduly
restrictive.
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16.
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Remedies for
Breach.
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(a)
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Injunctive
Relief: The Parties acknowledge and agree that the services to
be performed by Employee are special and unique and that money damages
cannot fully compensate the Bank in the event of Employee's violation of
the provisions of Section 16 of this Agreement. Thus, in the
event of a breach of any of the provisions of such Section, Employee
agrees that the Bank, upon application to a court of competent
jurisdiction, shall be entitled to an injunction restraining Employee from
any further breach of the terms and provision of such
Section. Should the Bank prevail in an action seeking an
injunction restraining Employee, Employee shall pay all costs and
reasonable attorneys’ fees incurred by the Bank in and relating to
obtaining such injunction. Such injunctive relief may be
obtained without bond and Employee's sole remedy, in the event of the
entry of such injunction, shall be the dissolution of such
injunction. Employee hereby waives any and all claims for
damages by reason of the wrongful issuance of any such
injunction.
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12
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(b)
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Cumulative
Remedies: Notwithstanding any other provision of this
Agreement, the injunctive relief described in Section 17(a) herein and all
other remedies provided for in this Agreement which are available to the
Bank as a result of Employee's breach of this Agreement, are in addition
to and shall not limit any and all remedies existing at or in equity which
may also be available to the Bank.
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17.
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Assignment. This
Agreement shall inure to the benefit of and be binding upon the Employee,
and to the extent applicable, her heirs, assigns, executors, and personal
representatives, and to the Bank, and to the extent applicable, its
successors, and assigns, including, without limitation, any person,
partnership, or corporation which may acquire all or substantially all of
the Bank's assets and business, or with or into which the Bank may be
consolidated or merged, and this provision shall apply in the event of any
subsequent merger, consolidation, or transfer, unless such merger or
consolidation or subsequent merger or consolidation is a transaction of
the type which would result in termination under Sections 9(c) and 9(d)
herein.
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18.
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Miscellaneous.
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(a)
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Amendment
of Agreement: Unless as otherwise provided herein, this
Agreement may not be modified or amended except in writing signed by the
Parties.
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(b)
|
Certain
Definitions: For purposes of this Agreement, the following
terms whenever capitalized herein shall have the following
meanings:
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(i)
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“Person"
shall mean any natural person, corporation, partnership (general or
limited), trust, association or any other business entity;
and
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(ii)
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"Attorneys’
Fees" shall include the legal fees and disbursements charged by attorneys
and their related travel and lodging expenses, court costs, paralegal
fees, etc. incurred in settlement, trial, appeal or in bankruptcy
proceedings.
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(iii)
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“Code”
shall mean the Internal Revenue Code of 1986, as
amended.
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(iv)
|
“Separation
from service” shall mean the Employee’s termination of employment or other
separation from service as defined in Section 1.409A-1(i) of the Treasury
Regulations, applying the default terms
thereof.
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(v)
|
“Treasury
Regulations” shall mean Title 26 of the Code of Federal Regulations, as
amended from time to time.
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13
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(c)
|
Headings
for Reference Only: The headings of the Sections and the
Subsections herein are included solely for convenient reference and shall
not control the meaning of the interpretation of any of the provisions of
this Agreement.
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(d)
|
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(e)
|
Severability: If
any of the provisions of this Agreement shall be held invalid for any
reason, the remainder of this Agreement shall not be affected thereby and
shall remain in full force and effect in accordance with the remainder of
its terms.
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(f)
|
Entire
Agreement: This Agreement and all other documents incorporated
or referred to herein, contains the entire agreement of the Parties and
there are no representations, inducements or other provisions other than
those expressed in writing herein. This Agreement amends,
supplants and supersedes any and all prior agreements between the
Parties. No modification, waiver or discharge of any provision
or any breach of this Agreement shall be effective unless it is in writing
signed by both Parties. A Party's waiver of the other Party's
breach of any provision of this Agreement, shall not operate, or be
construed, as a waiver of any subsequent breach of that provision or of
any other provision of this
Agreement.
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(g)
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Waiver: No
course of conduct by the Bank or Employee and no delay or omission of the
Bank or Employee to exercise any right or power given under this Agreement
shall: (i) impair the subsequent exercise of any right or
power, or (ii) be construed to be a waiver of any default or any
acquiescence in or consent to the curing of any default while any other
default shall continue to exist, or be construed to be a waiver of such
continuing default or of any other right or power that shall theretofore
have arisen. Any power and/or remedy granted by law and by this
Agreement to any Party hereto may be exercised from time to time, and as
often as may be deemed expedient. All such rights and powers
shall be cumulative to the fullest extent permitted by
law.
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(h)
|
Pronouns: As
used herein, words in the singular include the plural, and the masculine
include the feminine and neuter gender, as
appropriate.
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(i)
|
Recitals: The
Recitals set forth at the beginning of this Agreement shall be deemed to
be incorporated into this Agreement by this reference as if fully set
forth herein, and this Agreement shall be interpreted with reference to
and in light of such Recitals.
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14
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|
(j)
|
Code
Section 409A: With respect to any compensation promised under this
Agreement that is subject to Section 409A of the Code, this Agreement is
intended to comply with the applicable requirements of Sections 409A(a)(2)
through (4) of the Code and shall be interpreted to the extent context
reasonably permits in accordance with this intent. The parties
agree to modify this Agreement or the timing (but not the amount) of any
payment to the extent necessary to comply with Section 409A of the Code
and avoid application of any taxes, penalties, or interest
thereunder. However, in the event that any amounts payable
under this Agreement are subject to any taxes, penalties or interest under
Section 409A of the Code or otherwise, Employee shall be solely liable for
the payment thereof.
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IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the day
and year first written above.
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THE
JACKSONVILLE BANK
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|||
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By:
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/s/
Price ▇. ▇▇▇▇▇▇▇▇
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||
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, Employee
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On
behalf of the Board of
Directors
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||
15