Exhibit 10.3
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT, is entered into as
of June 17, 2008, by and between Peoples State Bank, Wausau,
Wisconsin, a Wisconsin banking corporation, (“the
Bank”) and Scott M. Cattanach (“Mr.
Cattanach”).
WITNESSETH:
WHEREAS, the Bank and Mr. Cattanach initially entered into an
employment agreement dated April 10, 2003.
WHEREAS, the Bank and Mr. Cattanach have entered into an Amendment
No. 1 to the employment agreement dated April 13, 2005, and an
Amendment No. 2 to the employment agreement dated February 22,
2007.
WHEREAS, the Company and Mr. Cattanach now desire to amend and
restate the employment agreement in its entirety by setting forth
the terms and conditions of their agreements and understandings in
this Amended and Restated Employment Agreement
(“Agreement”), which shall replace and supercede the
initial employment agreement and all such amendments effective as
of the date first written above.
NOW, THEREFORE, in consideration of the premises, covenants and
mutual agreements contained herein, the Bank and Mr. Cattanach
agree as follows:
1.
Employment . Subject to the earlier termination of
this agreement pursuant to the terms hereof, Mr. Cattanach is
hereby employed as the Chief Financial Officer and Treasurer of the
Bank; provided , however , that, prior to a Change of
Control, Mr. Cattanach may be employed in such other capacity as
the Board of Directors of the Bank shall deem appropriate and in
the best interests of the Bank. Mr. Cattanach agrees to serve
in such capacity or capacities on the terms and conditions
hereinafter set forth.
2.
Term . The term of this agreement commenced on April
10, 2003 (the “Commencement Date”) and shall end at
midnight on the Expiration Date, except as otherwise
provided in paragraph 8(a) hereof. The term “Expiration
Date” shall mean the first to occur of
(a) the date of Mr. Cattanach’s death, or (b) the later of
(i) July 1, 2009, and (ii) the date to which
the term of this agreement has most recently been extended pursuant
to the following sentence.
On July 1, 2009, and each subsequent July 1, the term of this
agreement shall automatically be
extended for one calendar year; provided , however ,
that automatic extensions of the term of this agreement (and,
consequently, the Expiration Date) pursuant to this sentence shall
cease on the
first to occur of (x) either the Bank or Mr. Cattanach giving to
the other, not less than 90 days
prior to the Expiration Date of the original or any extended term,
a written notice that no, or no
further, as the case may be, automatic extensions of the term of
this agreement shall thereafter occur, but the giving of such a
notice shall not affect any previous extensions, or (y) Mr.
Cattanach’s 66th birthday. For all purposes of this
Agreement other than as provided in
paragraph 8(a) hereof, the term “Term of Employment”
shall mean the period beginning on the
Commencement Date and ending on the earlier of the Expiration Date
or the date on which Mr. Cattanach’s employment is terminated
hereunder.
3.
Extent of Services . Mr. Cattanach agrees to devote
his full-time attention and efforts (except during vacation
periods, periods of illness and other approved absences as provided
for in paragraph 4(c)) to the duties of any office held by him
during the Term of Employment, provided , however ,
that Mr. Cattanach’s devotion of a reasonable and de minimis
portion of his attention or efforts to the management of his
personal affairs during normal business hours shall not constitute
a breach of the foregoing requirement.
4.
Compensation and Reimbursement .
(a)
Salary . The Bank shall pay to Mr. Cattanach a salary
based on an annual amount of $141,000. The Bank may increase
Mr. Cattanach’s salary from the amount specified herein
during the Term of Employment, but may not decrease Mr.
Cattanach’s salary from any previously established amount.
Mr. Cattanach’s salary shall be payable at such times
and in such installments as are consistent with the manner in which
the salaries of other executive officers of the Bank are paid.
(b)
Incentive Compensation . During the Term of
Employment, Mr. Cattanach shall be entitled to receive such
additional compensation from the Bank as may be provided for
officers of commensurate position or rank under the terms of any
incentive program from time to time maintained and in effect at the
Bank for executive officers.
(c)
Other Benefits . During the Term of Employment, Mr.
Cattanach shall be entitled to receive all benefits and perquisites
ordinarily provided to executive officers of the Bank, including
coverage under a director’s and officer’s liability
insurance policy, and Mr. Cattanach shall participate in all
employee benefit plans or fringe benefit programs now or hereafter
established or maintained by the Bank including, but not limited
to, group insurance plans, pension benefit plans, welfare benefit
plans, pay practices, and vacation and sick leave benefits.
Mr. Cattanach shall be entitled to participate in all plans
or programs maintained by the Bank on terms no less favorable than
those generally available to officers of the Bank and at a level of
participation commensurate with his office.
(d)
Expenses . The Bank shall pay or reimburse Mr.
Cattanach, upon submission of receipts by him, for all
entertainment, travel, meal, hotel accommodation, and miscellaneous
expenses reasonably incurred by him in the interest of the
Bank’s business during the Term of Employment.
5.
Termination of Employment .
(a)
Termination by the Bank for Good Cause . The Bank may
terminate Mr. Cattanach’s employment prior to the
Expiration Date for good cause only upon
compliance with the requirements of this paragraph 5(a).
“Good cause” for termination
of Mr. Cattanach’s employment by the Bank shall consist only
of one or more of (i) the commission of an act or acts by Mr.
Cattanach which results in a payment to the Bank or to PSB
Holdings, Inc, the parent company of the Bank (“PSB”)
of a claim filed by the
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Bank or PSB under a blanket banker fidelity bond policy as from
time to time and at any time maintained; (ii) the willful and
continuing failure to perform his duties in accordance with
standards or policies established, from time to time, or at any
time, by the Bank, after a written demand for substantial
performance is delivered to Mr. Cattanach by the Board which
specifically identifies the manner in which the Board believes that
Mr. Cattanach has not substantially performed his duties; (iii) the
commission by Mr. Cattanach of any crime of moral turpitude, of
dishonesty, of breach of trust, of theft, of embezzlement, of
misapplication of funds, of unauthorized issuance of obligations or
of false entries; (iv) any intentional, reckless, or negligent
act or omission to act by Mr. Cattanach which results in the
violation by Mr. Cattanach of any policy established by the Bank
which is designed to insure compliance with applicable banking,
securities, employment discrimination, or other laws which causes
or results in the Bank’s violation of such laws, except any
act done by Mr. Cattanach in good faith, as determined in the
reasonable discretion of the Board of Directors of the Bank, or
which results in a violation of such policies or law which is, in
the reasonable sole discretion of such Board, immaterial;
(v) any intentional, reckless, or negligent act or omission to
act by Mr. Cattanach which results in a violation of an employment
policy maintained by the Bank which is applicable to all other
employees (for example, employment policies relating to the use of
drugs or alcohol) and which, by the terms of such policy, is
grounds for termination of employment, or (vi) Mr.
Cattanach’s physical or mental disability, if such disability
either results in Mr. Cattanach receiving permanent disability
payments pursuant to any group disability insurance policy or
prevents Mr. Cattanach from the normal performance of his duties
for a continuous period of at least six months. Upon the
occurrence of any event constituting good cause for which the Bank
elects to terminate Mr. Cattanach’s employment prior to the
Expiration Date, the Bank shall provide written notice to
Mr. Cattanach, which shall state the good cause for
termination, and Mr. Cattanach’s termination of employment
shall be effective as of the date specified in such notice.
In the event of termination of Mr. Cattanach’s
employment in accordance with the conditions of this paragraph (a),
on the effective date of Mr. Cattanach’s termination of
employment, the Term of Employment shall end, all of Mr.
Cattanach’s obligations pursuant to this agreement (except
for those provided in paragraphs 6 and 7) shall end and the
Bank’s obligations to pay compensation or provide benefits to
Mr. Cattanach pursuant to paragraph 4 shall end.
(b)
Termination by the Bank Other Than for Good Cause .
The Bank may terminate Mr. Cattanach’s employment prior
to the Expiration Date for any reason other
than good cause (as defined in paragraph 5(a)) upon providing
written notice to
Mr. Cattanach specifying the effective date of Mr.
Cattanach’s termination of
employment. If the Bank terminates Mr. Cattanach’s
employment other than for good
cause under paragraph 5(a), the Term of Employment and all of Mr.
Cattanach’s
obligations pursuant to this agreement (except for those provided
in paragraphs 6 and 7)
shall end on the effective date of Mr. Cattanach’s
termination of employment and the
Bank shall provide, for a period beginning on the effective date of
Mr. Cattanach’s
termination of employment, as a severance benefit to Mr. Cattanach
and as liquidated
damages for breach by the Bank of its otherwise applicable
obligations hereunder, (i) a
monthly cash payment equal to the amount which would, except for
Mr. Cattanach’s termination of employment, have been paid to
Mr. Cattanach, if then living, as salary
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under paragraph 4(a) for the remainder of the current or any
extended term of this agreement, but in no event shall such
payments be for a period of less than 12 months, and (ii) until Mr.
Cattanach becomes eligible for coverage under the health insurance
plan of another employer of Mr. Cattanach, coverage for Mr.
Cattanach, under the same terms then available to executive
officers of the Bank, under any group health insurance program in
which Mr. Cattanach was a participant on the effective date of
Mr. Cattanach’s termination of employment or under such
successor plan or program as maintained after such date for the
benefit of the Bank’s employees but in no event longer than
the period for which payments are made pursuant to clause (i). Mr.
Cattanach shall not, by virtue of his severance benefit and
liquidated damages rights, acquire any right, title or interest in
particular assets of the Bank, and such rights shall be no greater
than the right of any unsecured general creditor of the Bank.
Despite any other provision of this agreement, Mr. Cattanach
shall not be entitled to any severance benefit or liquidated
damages, and the Bank shall not be obligated to pay any such
benefit or damages, if Mr. Cattanach violates the provisions
of paragraph 6 or 7.
(c)
Termination by Mr. Cattanach . Mr. Cattanach may
terminate his employment at any time upon providing 30 days prior
written notice to the Bank stating the effective date of his
termination. In any such event, all obligations of the Bank
to Mr. Cattanach under this agreement and all obligations of Mr.
Cattanach to the Bank (except those provided for in paragraphs 6
and 7) shall cease and the Term of Employment shall end on the
effective date of Mr. Cattanach’s termination of
employment.
(d)
Section 409A Considerations . This paragraph 5(d)
shall apply in the event the Bank determines, in good faith, that
payment of severance benefits pursuant to this paragraph or
paragraph 8(d) are subject to the provisions of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”).
For purposes of Mr. Cattanach’s entitlement to any
severance benefit pursuant to paragraph 5(b) or 8(b), Mr. Cattanach
shall be deemed to have incurred a termination of employment with
the Bank only on such date on which his employment has been
terminated by the Bank, each other member of the controlled group
of corporations of which the Bank is a member, and each other
entity under common control with the Bank, and has thereby incurred
a separation from service (a “Separation from Service”)
within the meaning of Code Section 409A(a)(2)(A)
