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Exhibit
10(e)
EMPLOYMENT CONTINUITY
AGREEMENT
This Employment Continuity
Agreement (the “Agreement”) is made as of
August 28, 2000, between BOE Financial Services of Virginia,
Inc. (“BOE Financial”), and (the
“Executive”). The purpose of the Agreement is to
encourage the Executive to continue in employment with the Company
following a Change of Control by providing reasonable employment
security to the Executive, and to recognize the prior service of
the Executive in the event that the Executive’s employment
with the Company terminates under defined circumstances following a
Change of Control.
Section 1. Definitions.
For purposes of this Agreement:
(a) “Affiliated
Company” means any corporation which is a member of a
controlled group of corporations that includes BOE Financial, as
determined pursuant to Section 1563(a) of the Internal Revenue
Code of 1986, without regard to Sections 1563(a)(4) or
1563(e)(3)(c).
(b) “Base Salary”
shall mean the Executive’s annual base salary in effect as of
the Effective Date.
(c) “Beneficiary”
shall mean the person or entity designated by the Executive, by
written instrument delivered to the Company, to receive any
benefits payable under this Agreement in the event of the
Executive’s death. If the Executive fails to designate a
Beneficiary, or if no Beneficiary survives the Executive, such
death benefits shall be paid to the Executive’s
estate.
(d) “Board” shall
mean the Board of Directors of BOE Financial.
(e) “Change of
Control” shall mean the occurrence of any of the following
events:
(i) any person, including the
“group” as defined in Section 13(d)(3) of the
Securities Exchange Act of 1934 becomes the owner or beneficial
owner of BOE Financial securities having 20% or more of the
combined voting power of the then outstanding BOE Financial
securities that may be cast for the election of initiated by BOE
Financial, or open market purchases approved by the Board, as long
as the majority of the Board approving the purchases is also the
majority at the time the purchases are made); or
(ii) as the direct or
indirect result of, or in connection with, a cash tender or
exchange offer, a merger or other business combination, a sale of
assets, a contested election, or any combination of these
transactions, the persons who were directors of BOE Financial
before such transactions cease to constitute a majority of the
Board, or any successor’s board, within two years of the last
of such transactions.
(f) “Company”
means BOE Financial and each Affiliated Company.
(g) “Effective
Date” shall mean the date on which a Change of Control
occurs.
(h) “Good Cause”
shall mean the Executive’s (i) material misappropriation
with respect to the business assets of the Company,
(ii) persistent refusal or willful failure materially to
perform his duties and responsibilities to the Company, which
continues after the Executive receives notice of such refusal or
failure, (iii) conviction of a felony, or (iv) use of
drugs or alcohol that interferes materially with the
Executive’s performance of his duties.
(i) “Maximum Bonus
Opportunity” shall mean the maximum cash bonus payable to the
Executive by the Company.
(j) “Salary Continuance
Benefit” shall mean benefit described in Section 2(b),
(c) and (d) of this agreement.
(k) “Severance
Benefit” shall mean the Salary Continuance Benefit and the
Welfare Continuance Benefit described in Section 2 of this
agreement.
(l) “Severance
Period” shall mean the period beginning on the date the
Executive’s employment with the Company terminates and ending
on the date that is one (1) year thereafter.
(m) “Termination with
Good Reason” means, unless and to the extent otherwise waived
in writing by the Executive, the termination of the
Executive’s employment with the Company which is initiated by
the Executive and that occurs within 90 days of any of the
following events (excluding for this purpose, isolated,
insubstantial and inadvertent actions not in bad faith and which
are remedied by the Company within 15 days after receipt of notice
thereof given by the Executive):
(i) a decrease in the
Executive’s aggregate Base Salary and incentive bonus
opportunity or a significant reduction in the amount of additional
benefits or perquisites provided to the Executive as of the
Effective Date;
(ii) any action by the
Company which decreases the Executive’s authority, duties or
responsibilities of the Executive as of the Effective
Date.
(iii) the assignment of
duties to the Executive that are inconsistent with the duties and
responsibilities of the Executive as of the Effective
Date.
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(n) “Welfare
Continuance Benefit” shall mean the benefit described in
Section 2(e).
(o) “Welfare
Plan” shall mean any health and dental plan, disability plan,
survivor income plan, life insurance plan or any other welfare
benefit plan, as defined in Section 3(1) or ERISA, currently
or hereafter made available by the Company in which the Executive
is eligible to participate.
Section 2. Benefits
Upon Termination of Employment
(a) Subject of the provisions
of Section 6, the Executive shall be entitled to a Salary
Continuance Benefit and a Welfare Continuance Benefit if
(i) the employment of the Executive with the Company is
terminated by the Company for any reason other than Good Cause
within two (2) years following the Effective Date, or
(ii) the Executive has a Termination for Good Reason within
two (2) years following the Effective Date.
(b) The Salary Continuance
Benefit shall be an amount equal to ___________ times the sum of
(i) the Executive’s Base Salary, and (ii) the
Executive’s Maximum Bonus Opportunity.
(c) The Salary Continuance
Benefit shall be paid, at the election of the Executive, in one of
the following methods:
(i) equal monthly payments
during the one-year period following the date of the
Executive’s termination of employment, or
(ii) a single lump sum
payment within 30 days of the date of the Executive’s
termination of employment.
The election must be made by
the Executive on a form provided by the Company and may not be
subsequently changed, except as provided in Section 4
below.
(d) Payment of the Salary
Continuance Benefit shall be subject to the following terms and
conditions:
(i) Salary Continuance
Benefits shall be made net of all required federal and state
payroll taxes and similar required withholdings.
(ii) Payment of the Salary
Continuance Benefit shall not affect the entitlement of the
Executive or the Executive’s Beneficiary, or any other person
entitled to receive benefits with respect to the Executive under
any retirement plan, Welfare Plan, or other plan or program
maintained by the Company in which the Executive participates at
the date of termination of employment.
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(ii) Except as specifically
provided in subsection (f) below, the Salary Continuance
Benefit shall not be affected by any employment which the Executive
may obtain after termination with the Company nor otherwise shall
be subject to mitigation in any respect.
(e) During the Severance
Period, the Executive and the Executive’s dependents will
continue to be covered by all Welfare Plans in which the Executive
and the Executive’s dependents were particip
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