CHANGE OF
CONTROL/SEVERANCE AGREEMENT
THIS CHANGE OF CONTROL/SEVERANCE
AGREEMENT (the “Agreement”) is entered into by and
between EvergreenBank (the “Bank”), a Washington
state-chartered bank, and Michael H. Tibbits (the
“Executive”), effective as of October 24, 2006
(the “Commencement Date”).
WHEREAS, the Executive is currently
employed by the Bank in the capacity of Executive Vice President
and Chief Credit Officer; and
WHEREAS, the Bank wishes to ensure
that the Executive will be available to assist the Board of
Directors of the Bank in responding to and, if deemed appropriate
by the Board, completing any proposed change of control (as defined
herein) of the Bank or of its holding company, EvergreenBancorp,
Inc. (the “Holding Company”);
NOW, THEREFORE, the Bank and the
Executive agree as follows:
1. Certain Definitions
.
(a) The term “Change of
Control,” for purposes of this Agreement, means: (i) any
“person,” as such term is used in Sections 13(d) and
14(d) of the Exchange Act, other than the Holding Company or any
Consolidated Subsidiaries (as hereinafter defined), is or becomes
the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) directly or indirectly of securities of the Bank or
the Holding Company representing 50% or more of the combined voting
power of the Bank’s or Holding Company’s outstanding
securities; (ii) individuals who are members of the Board of
Directors of the Holding Company (the “Board”) on the
Commencement Date (the “Incumbent Board”) cease for any
reason to constitute at least a majority thereof, provided that any
person becoming a director subsequent to the Commencement Date
whose election was approved by a vote of at least one-half (1/2) of
the directors comprising the Incumbent Board or whose nomination
for election by the Holding Company’s stockholders was
approved by the nominating committee serving under an incumbent
Board or who was appointed as a result of a change at the direction
of the Federal Reserve Board or the Federal Deposit Insurance
Corporation (“FDIC”), shall be considered a member of
the Incumbent Board; (iii) the stockholders of the Holding Company
approve a merger, consolidation or acquisition of the Holding
Company or the Bank, with or by any other corporation or entity,
other than (1) a merger, consolidation or acquisition which
would result in the voting securities of the Holding Company
outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 50% of the combined
voting power of the voting securities of the Holding Company or
such surviving entity outstanding immediately after such merger or
consolidation or (2) a merger or consolidation effected to
implement a recapitalization of the Holding Company or the Bank (or
similar transaction) in which no person (as hereinabove defined)
acquires more than 50% of the combined voting power of the Holding
Company’s then outstanding securities; or (iv) the
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stockholders of the Holding Company approve a plan of complete
liquidation of the Holding Company or the Bank or an agreement for
the sale or disposition by the Holding Company of all or
substantially all of the Holding Company’s or the
Bank’s assets (or any transaction having a similar effect);
provided that the term “Change of Control” shall not
include an acquisition of securities by an employee benefit plan of
the Bank or the Holding Company or a change in the composition of
the Board at the direction of the Federal Reserve Board or the
FDIC. Upon a Change of Control, the provisions hereof shall become
immediately operative.
(b) The term
“Consolidated Subsidiaries” means any subsidiary or
subsidiaries of the Holding Company that are part of the affiliated
group (as defined in Section 1504 of the Internal Revenue Code
of 1986, as amended (the “Code”), without regard to
subsection (b) thereof) that includes the Bank.
(c) The term “Good
Reason” means only any one or more of the following:
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(i)
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material reduction, without Executive’s
consent, of Executive’s salary or material elimination of any
compensation or benefit plan benefiting Executive, unless the
reduction or elimination is generally applicable to substantially
all Bank employees (or employees of a successor or controlling
entity of the Bank), or, if applicable, to similarly situated
executives of other companies within the same multiple-employer
benefit plan, formerly benefited;
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(ii)
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the assignment to Executive without his
consent of any authority or duties materially lesser than
Executive’s responsibilities as of the date of this
Agreement;
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(d) The term “Termination
for Cause” means termination of the employment of
the Executive because of the Executive’s dishonesty,
incompetence, willful misconduct, breach of a fiduciary duty
involving personal profit, intentional failure to perform duties or
gross negligence in such performance, insubordination, 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 or any other
agreement between Executive and the Bank or the Holding
Company.
2. Other Compensation and
Terms of Employment . This Agreement is not an employment
agreement and shall not be construed as such or as providing the
Executive any right to be retained in the employ of the Holding
Company or the Bank or any affiliate thereof. Accordingly, except
with respect to the Change of Control severance benefits, this
Agreement shall have no effect on the determination of any
compensation payable by the Bank to Executive, or upon any of the
terms of Executive’s employment with the Bank. Nothing in
this Agreement shall be deemed to prohibit the Bank at any time
from terminating the Executive’s employment during the term
of this Agreement with or without notice for any reason. The
specific arrangements referred to herein are not intended to
exclude any other benefits which may be available to Executive upon
a termination of employment with the Bank pursuant to employee
benefit plans of the Bank or otherwise.
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3. Termination of the
Agreement .
(a) This Agreement may be
terminated unilaterally by the Bank, but only as of a prospective
effective date which follows by at least 15 months the date
that written notice is given to Executive that the Bank, by a vote
of at least a majority of its directors, has dete
