Exhibit 10.5
AMENDED AND
RESTATED
EMPLOYMENT
AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT
AGREEMENT effective January 1, 2008, is an amendment and
restatement of the employment agreement made and entered into as of
the ?? day of March, 2008 by and between Eastern Virginia
Bankshares, Inc., a Virginia corporation,
(“Corporation”), and Joseph H. James, Jr.
(“Employee”). This amended and restated employment
agreement provides as follows:
RECITALS
WHEREAS, the Corporation is a bank
holding company engaged in the operation of banks; and
WHEREAS, Employee has been involved
in the management of the business and affairs of the Corporation
and, therefore, possesses managerial experience, knowledge, skills
and expertise in such type of business; and
WHEREAS, the employment of Employee
by the Corporation is in the best interests of the Corporation and
Employee; and
WHEREAS, the parties have mutually
agreed upon the terms and conditions of Employee’s continued
employment by the Corporation as hereinafter set forth;
TERMS OF
AGREEMENT
NOW, THEREFORE, for and in
consideration of the premises and of the mutual promises and
undertakings of the parties as hereinafter set forth, the parties
covenant and agree as follows:
Section 1. Employment .
(a) Employee shall be employed as an executive officer of the
Corporation. He shall perform such services for the Corporation
and/or one or more Affiliates as may be assigned to Employee by the
Corporation from time to time and that are commensurate with his
training and experience upon the terms and conditions hereinafter
set forth.
(b) References in this Agreement to
services rendered for the Corporation and compensation and benefits
payable or provided by the Corporation shall include services
rendered for and compensation and benefits payable or provided by
any Affiliate. References in this Agreement to the
“Corporation” also shall mean and refer to each
Affiliate for which Employee performs services. References in this
Agreement to “Affiliate” shall mean any business entity
that, directly or indirectly, through one or more intermediaries,
is controlled by the Corporation.
Section 2. Term and
Renewal . The initial term of this Agreement shall end
December 31, 2008. However, on each December 31,
beginning with December 31, 2007, the term of this Agreement
shall be renewed and extended by one year unless Employee or the
Corporation gives prior notice to the other in writing that the
term shall not be renewed and extended. This Agreement shall
terminate at the end of its term.
Section 3. Exclusive
Service . Employee shall devote his best efforts and full time
to rendering services on behalf of the Corporation in furtherance
of its best interests. Employee shall comply with all policies,
standards and regulations of the Corporation now or hereafter
promulgated, and shall perform his duties under this Agreement to
the best of his abilities and in accordance with standards of
conduct applicable to officers of banks.
Section 4. Salary .
(a) As compensation while employed hereunder, Employee, during
his faithful performance of this Agreement, in whatever capacity
rendered, shall receive an annual base salary of $139,100
payable on such terms and in such installments as the parties may
from time to time mutually agree upon. The Board of Directors, in
its discretion, may increase Employee’s base salary during
the term of this Agreement.
(b) The Corporation shall withhold
state and federal income taxes, social security taxes and such
other payroll deductions as may from time to time be required by
law or agreed upon in writing by Employee and the Corporation. The
Corporation shall also withhold and remit to the proper party any
amounts agreed to in writing by the Corporation and Employee for
participation in any corporate sponsored benefit plans for which a
contribution is required.
(c) Except as otherwise expressly
set forth hereunder, no compensation shall be paid pursuant to this
Agreement in respect of any month or portion thereof subsequent to
any termination of Employee’s employment by the
Corporation.
Section 5. Corporate Benefit
Plans . Employee shall be entitled to participate in or become
a participant in any employee benefit plan maintained by the
Corporation for which he is or will become eligible on such terms
as the Board of Directors may, in its discretion, establish, modify
or otherwise change.
Section 6. Bonuses .
Employee shall receive only such bonuses as the Board of Directors,
in its discretion, decides to pay to Employee.
Section 7. Expense
Account . The Corporation shall reimburse Employee for
reasonable and customary business expenses incurred in the conduct
of the Corporation’s business. Such expenses will include
business meals, out-of-town lodging and travel expenses. Employee
agrees to timely submit records and receipts of reimbursable items
and agrees that the Corporation can adopt reasonable rules and
policies regarding such reimbursement. The Corporation agrees to
make prompt payment to Employee following receipt and verification
of such reports.
Section 8. Personal and Sick
Leave . Employee shall be entitled to the same personal and
sick leave as the Board of Directors may from time to time
designate for all full-time employees of the
Corporation.
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Section 9. Vacations .
Employee shall be entitled to twenty (20) week days of
vacation leave each year which shall be taken at such time or times
as may be approved by the Corporation and during which
Employee’s compensation hereunder shall continue to be
paid.
Section 10. Termination
. (a) Notwithstanding the termination of Employee’s
employment pursuant to any provision of this Agreement, the parties
shall be required to carry out any provisions of this Agreement
which contemplate performance by them subsequent to such
termination. In addition, no termination shall affect any liability
or other obligation of either party which shall have accrued prior
to such termination, including, but not limited to, any liability,
loss or damage on account of breach. No termination of employment
shall terminate the obligation of the Corporation to make payments
of any vested benefits provided hereunder or the obligations of
Employee under Sections 11, 12 and 13.
(b) Employee’s employment
hereunder may be terminated by Employee upon thirty (30) days
written notice to the Corporation or at any time by mutual
agreement in writing.
(c) This Agreement shall terminate
upon death of Employee; provided, however, that in such event the
Corporation shall pay to the estate of Employee the compensation
including salary and accrued bonus, if any, which otherwise would
be payable to Employee through the end of the month in which his
death occurs.
(d)(1) The Corporation may terminate
Employee’s employment other than for “Cause”, as
defined in Section 10(e), at any time upon written notice to
Employee, which termination shall be effective immediately.
Employee may resign thirty (30) days after notice to the
Corporation for “Good Reason”, as hereafter defined. In
the event the Employee’s employment terminates pursuant to
this Section 10(d), Employee shall receive a monthly amount
equal to one-twelfth (1/12) his rate of annual base salary in
effect immediately preceding such termination (“Termination
Compensation”) in each month for the remainder of the term of
this Agreement. Payments of the Termination Compensation shall be
made at the times such payments would have been made in accordance
with Section 4(a).
(2) Notwithstanding anything in this
Agreement to the contrary:
(i) If Employee breaches
Section 11 or 12, Employee will not thereafter be entitled to
receive any further compensation or benefits pursuant to this
Section 10(d); and
(ii) If, while he is receiving
payments under this Section 10(d), Employee engages in a
Competitive Business within the area described in
Section 12(i), such payments will cease and he will not
thereafter be entitled to receive any compensation or benefits
pursuant to this Section 10(d) even though such conduct occurs
after the covenants contained in Section 12 have
expired.
(3) The Corporation shall not be
required to make payment of the Termination Compensation or any
portion thereof to the extent such payment is prohibited by the
terms of the regulations presently found at 12 C.F.R. part 359 or
to the extent that any other governmental approval of the payment
required by law is not received.
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(4) Except as set forth in Sections
10(d)(2) and 10(d)(3), the Corporation’s obligation to pay
the Employee the compensation provided in Section 10(d)(l) shall be
absolute and unconditional and shall not be affected by any
circumstances, including, without limitation, any set-off,
counterclaim, recoupment, defense or other right which the
Corporation may have against him or anyone else. All amounts
payable by the Corporation hereunder shall be paid without notice
or demand. Each and every payment made hereunder by the Corporation
shall be final and the Corporation will not seek to recover all or
any part of such payment from the Employee or from whosoever may be
entitled thereto, for any reason whatsoever. The Employee shall not
be required to mitigate the amount of any payment provided for in
this Agreement by seeking other employment or otherwise.
(5) For purposes of this Agreement,
“Good Reason” shall mean:
(i) The assignment of duties to the
Employee by the Corporation which result in the Employee having
materially less authority or responsibility than he has on the date
hereof, without his express written consent;
(ii) Requiring the Employee to
maintain his principal office outside of Essex County, Virginia
unless the Corporation moves its operations center to a place to
which the Employee is required to move;
(iii) A material reduction by the
Corporation of the Employee’s base salary, as the same may
have been increased from time to time; or
(iv) The Corporation’s failure
to comply with any material term of this Agreement.
The Employee is required to provide
notice to the Company of the existing of a condition above within a
90 day period of the initial existence of the condition, upon the
notice of which the Company shall have 30 days to remedy the
condition without having to pay the amounts described in this
section.
(e) The Corporation shall have the
right to terminate Employee’s employment under this Agreement
at any time for Cause, which termination shall be effective
immediately. Termination for “Cause” shall include
termination for Employee’s personal dishonesty, incompetence,
willful misconduct, breach of a fiduciary duty involving personal
profit, intentional failure to perform stated duties, willful
violation of any law, rule or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order,
conviction of a felony or of a misdemeanor involving moral
turpitude, misappropriation of the Corporation’s assets
(determined on a reasonable basis) or those of its Affiliates, or
material breach of any other provision of this Agreement. In the
event Employee’s employment under this Agreement is
terminated for Cause, Employee shall thereafter have no right to
receive compensation or other benefits under this
Agreement.
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(f) The Corporation may terminate
Employee’s employment under this Agreement, after having
established the Employee’s disability by giving to Employee
written notice of its intention to terminate his employment for
disability and his employment with the Corporation shall terminate
effective on the 90th day after receipt of such notice if within 90
days after such receipt Employee shall fail to return to the
full-time performance of the essential functions of his position
(and if Employee’s disability has been established pursuant
to the definition of “disability” set forth below). For
purposes of this Agreement, “disability” means either
(i) disability which after the expiration of more than 13
consecutive weeks after its commencement is determined to be total
and permanent by a physicia
