Exhibit 10.26
AMENDED EMPLOYMENT
AGREEMENT
THIS AMENDED EMPLOYMENT AGREEMENT
(“Agreement”) is made as of
November 21, 2006, by and between BANK OF THE
COMMONWEALTH, a banking corporation organized under the laws of
Virginia (the “Bank”), COMMONWEALTH BANKSHARES, INC., a
Virginia corporation (the “Holding Company”), and
EDWARD J. WOODARD, JR (the “Executive”); the Bank being
sometimes hereinafter referred to as the
“Employer.”
This Agreement shall supersede and
replace the Amended Employment Agreement entered into previously by
the parties on May 18, 2004, and is amended as of
December 31, 2008, in order to comply with applicable
provisions of Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”).”
WITNESSETH THAT:
WHEREAS, the Executive is rendering
valuable services to the Employer and it is the desire of the
Employer to have the benefit of the Executive’s loyalty,
service and counsel; and
WHEREAS, the Executive wishes to
continue in the employ of the Employer.
NOW, THEREFORE, in consideration of
the mutual covenants and agreements herein set forth, the parties
covenant and agree as follows:
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1.
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EMPLOYMENT . The Employer agrees to employ the Executive to
perform services for the Employer and the Executive agrees to serve
the Employer upon the terms and conditions herein provided. The
Executive agrees to perform such managerial duties and
responsibilities as shall be assigned to him/her by the Board of
Directors of the Employer, which duties and responsibilities shall
be of substantially the same character to those required by his/her
assigned office and functions on the date of this Agreement. The
Executive shall devote his/her time and attention on a full-time
basis to the discharge of the duties undertaken by him/her
hereunder.
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(a)
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Term of Employment
. The term of
employment under this Agreement is effective November 21, 2006
and will expire on December 31, 2009; provided that on
December 31, 2008 and on each December 31
st
thereafter (each
such December 31 st is referred to as the
“Renewal Date”), this Agreement will be automatically
extended for an additional calendar year so as to terminate two
years from such Renewal Date. This Agreement will not, however, be
extended if the Employer gives written notice of such non-renewal
to the Executive before the Renewal Date (the initial and any
extended term of this Agreement is referred to as the
“Employment Period”).
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(b)
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Compensation . During the Employment Period, the Executive
shall receive for his/her services a base salary and incentive or
bonus compensation in amounts determined by the Employer’s
Board of Directors or an appropriate committee of the Employer in
accordance with the salary administration program of the Employer
as the same may from time to time be in effect, but In no event
shall such base salary be less than the Executive’s base
salary at the date hereof.
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(c)
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Benefits . During the Employment Period, the Executive
shall be eligible for participation in any additional plans,
programs or forms of compensation or benefits that the
Employer’s Board of Directors might hereinafter provide to
the class of employees that includes the Executive.
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(a)
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Termination as a Consequence
of Death or Disability .
If the Executive dies during the Employment Period, the Employer
will pay his/her estate the base salary then in effect through the
end of the calendar month in which his/her death occurs. If the
Executive
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becomes “disabled”
(as defined below), the Employer may give the Executive written
notice of its intention to terminate the Executive’s
employment, in which event the Executive’s employment with
the Employer will terminate on the 30 th day after receipt of such notice
by the Executive. The Employer will continue to pay the Executive
his/her basic salary for the first six months after such
termination date and will continue to provide for such six month
period health and medical insurance coverage to the Executive on
the same basis as in effect on the termination date.
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For purposes of this
Section 2(a), the Executive is “disabled” if
he/she is unable to perform substantially all of his/her duties and
responsibilities hereunder, which disability lasts for an
uninterrupted period of at least 180 days or a total of at least
240 days out of any consecutive 360 day period, as a result of the
Executive’s incapacity due to physical or mental illness (as
determined by the opinion of an independent physician selected by
the Employer).
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(b)
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Termination
by the Employer for Cause . The Executive’s employment may be
terminated by the Employer for Cause at any time without further
liability on the part of the Employer or the Holding Company. If
the Employer terminates the Executive for Cause, the Executive
shall have no right to render services or to receive compensation
or other benefits under this Agreement for any period after such
termination. Only the following shall constitute
“Cause” for such termination: (i) the material
failure of the Executive, after written notice, for reasons other
than disability, to render services to the Employer as provided
herein; (ii) the Executive’s gross or willful neglect of
duty; or (iii) illegal or intentional acts by the Executive
demonstrating bad faith toward the Employer.
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(c)
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Termination
by the Executive Without Good Reason . The Executive may terminate his/her employment
hereunder without Good Reason (as defined below) by written notice
to the Board of Directors of the Employer effective thirty days
after receipt of such notice by the Board. Upon termination of
employment by the Executive, the Executive shall have no right to
render services or to receive compensation or other benefits under
this Agreement for any period after such termination.
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(d)
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Termination
by the Employer Without Cause . The Executive’s employment may be
terminated by the Employer without Cause upon thirty days’
prior written notice of such termination, in which case the
Executive will be entitled to the following benefits:
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(i)
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The Employer
will pay the Executive in a lump sum cash payment within ten days
after the Date of Termination (as defined below) the following:
(1) the Executive’s base salary then in effect through
the Date of Termination; and (2) the amount, if any, of any
incentive or bonus compensation theretofore earned which has not
yet been paid.
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(ii)
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For the two
year period subsequent to the Date of Termination the Employer
shall continue to pay the Executive his/her base salary in effect
on the Date of Termination, such payments to be made on the same
periodic dates as salary payments would have been made to the
Executive had his/her employment not been terminated.
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(iii)
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For the two
year period subsequent to the Date of Termination the Executive
shall continue to receive medical and other insurance benefits
pursuant to plans made available by the Employer to its officers
and employees at the expense of the Employer to substantially the
same extent the Executive received such benefits on the Date of
Termination (it being acknowledged that the post-termination plans
may be different from the plans in effect on the Date of
Termination). For purposes of the application of such benefits, the
Executive shall be treated as if he/she had remained in the employ
of the Employer, with an annual salary at the rate in effect on the
Date of Termination.
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(iv)
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The
Employer’s obligation to provide the Executive with medical
and insurance benefits pursuant to Section 2(d)(iii) hereof
shall terminate with respect to each particular type of insurance
in the event the Executive becomes employed and has made available
to him/her in connection with such employment that particular type
of insurance, so long as such insurance is substantially similar to
the insurance provided by the Employer.
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(e)
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Termination
by the Executive with Good Reason . The Executive may terminate his/her employment
hereunder for Good Reason at any time and be entitled to receive
the compensation and other benefits set forth in Section 2(d),
except that the applicable time period set forth in
Section 2(d)(ii) and (iii) for the continuation of salary
and medical and other insurance benefits shall extend for three,
and not two, years after the Employer is advised in writing by the
Executive of the basis for his/her claim of Good Reason and has
been given a reasonable opportunity and period to take appropriate
remedial action. For purposes of this Agreement, “Good
Reason” means:
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(i)
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the assignment
of duties to the Executive by the Employer which result in the
Executive having significantly less authority or responsibility
than he/she had on the date of hire, without his/her express
written consent;
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(ii)
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a reduction by
the Employer of the Executive’s base salary, as the same may
be increased from time to time, without his/her express written
consent;
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(iii)
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the requirement
that the Executive’s principal office location be moved or
relocated to a location that is more than 35 miles from the
location of the Executive’s principal office location as of
the date hereof; or
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(iv)
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the
Employer’s failure to comply with any material term of this
Agreement; or
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The right of the Executive to
terminate his/her employment for Good Reason may be exercised by
the Executive at any time during the Employment Period at his/her
sole discretion and any failure by the Executive to exercise this
right after he/she has Good Reason to do so shall not be deemed a
waiver of such right.
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(f)
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Notice of
Termination . Any
termination of the Executive’s employment by the Employer or
by the Executive shall be communicated by a written “Notice
of Termination” to the other party hereto. For purposes of
this Agreement, Notice of Termination shall mean a
notice
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