Exhibit 10.1
EMPLOYMENT AGREEMENT
EFFECTIVE AS OF November 16,2002
AGREEMENT by and between Victory State Bank ("Bank") and Merton
Corn
("Executive") effective on November 16, 2002. Executive shall
receive an "Early
Sign On Bonus" bonus of $34,000.00 effective and payable
immediately upon
Executive's execution of this Employment Agreement.
Whereas Bank desires to continue to employ Executive to devote his
full
time and attention to the business of the Bank, and Executive
desires to
continue to be so employed.
Whereas, the terms, conditions and undertakings contained in
this
Agreement were submitted to, and duly approved and authorized by,
the Bank's
Board of Directors at its regular meeting on May 14, 2002, subject
to approval
of same by all applicable regulators, if applicable.
Now, therefore, the parties agree as follows:
1. Employment. Bank
agrees to employ Executive, and Executive agrees
to be so employed, in the capacity of President, Chief Executive
Officer of the
Bank and such other related officer position(s) as may be required,
collectively
("Executive Employment") provided Executive satisfies and continues
to satisfy
all applicable regulatory and legal requirements. Employment shall
be for a term
of five years effective as set forth above and terminating five
years
thereafter. Nothing set forth herein shall diminish or affect
Bank's or
Executive's Termination rights as set forth in P. 4 below.
2. Time and efforts.
Executive shall diligently and conscientiously
devote his full and exclusive time and attention and best efforts
in discharging
the duties required by his Executive Employment.
3. Compensation. Bank
shall pay to Executive as compensation for his
services the sum of $195,000.00 per annum ("Base Salary").
Executive shall be
entitled to annual salary increases of 5% over the preceding year's
base salary
commencing on the second year anniversary of the effective date of
this contract
or November 16, 2004. Executive's Base Salary shall be paid
bi-weekly. In
addition thereto, Executive may be entitled to an annual bonus
payable
approximately 60 days after the end of each calendar year based
upon and after
considering the following factors:
(a) The
performance of the Bank as compared to its peers; and
(b) The
performance of the Bank as compared to previous years
performance; and
(c) Bonus
payments made to other chief executive officers at peer
banks with similar performance; and
(d) Bonus
payments made to other officers of the Bank; and
(e) Other
factors deemed appropriate by the Board of Directors.
4. Termination.
Executive may not terminate this Agreement prior to
the third anniversary of its effective date. Bank may terminate
this Agreement
prior to the third anniversary of its effective date only for Cause
as set forth
below. Notwithstanding the foregoing, however, in the event that
either Bank or
Executive shall terminate this Executive's employment pursuant to
this Agreement
prior to the third anniversary of its effective date (other than
for Cause as
set forth below), the Executive shall be entitled to payment by
Bank of six (6)
months' salary as "Accrued Severance." The Bank's duty to pay said
Accrued
Severance, however, shall not constitute a waiver of the Bank's or
of
Executive's right to pursue any and all legal and equitable
remedies for breach
of this Agreement as a result of such early termination.
Commencing after the third anniversary of the effective date of
this
Agreement i.e. after November 16, 2005, either Bank or Executive
may at any
time, terminate Executive's Executive Employment on ninety (90)
days' prior
written notice to the other party, as the case may be.
Notwithstanding the
foregoing, the Executive's employment pursuant to this Agreement
may be
terminated at any time by the Bank for Cause. In the event
Executive's Executive
Employment is terminated by Bank for Cause, Bank shall not be
required to give
any notice and the Bank thereafter shall have no further
obligations under this
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Agreement, including, without limitation, any obligation to pay
salary or bonus
or severance, or to provide benefits hereunder. For purposes of
this Agreement
"for Cause" shall mean: (a) a material breach of this Agreement;
(b) willful
violation of Federal, State or agency law or regulation causing
damage to the
Bank or having a detrimental effect on the Bank's business; (c)
willful and
continued personal misconduct, action or inaction causing damage to
the Bank or
having a detrimental effect on the Bank's business; (d) actions
contrary to the
policies and/or business practices of the Bank; or (e) Disability
as defined in
P. 10 herein except that only in the case of Disability, Executive
shall be
entitled to salary as set forth in P. 10.
5. Severance.
(i)
Termination by
the Bank. In the event Executive's Executive
Employment is terminated by Bank during the term of this Agreement
after three
years, without Cause and for reasons other than a "Change in
Control", as
hereafter defined, Bank's liability shall be as follows:
o if
terminated by Bank after Executive has been employed
pursuant to this Agreement for more than three (3)
years from its effective date (but less than four (4)
years), then the Bank's liability shall limited to
payment of an amount equal to eight (8) months' salary;
o if
termination occurs as aforesaid, after Executive has
been employed pursuant to this Agreement for more than
four(4) years, but less than four (4) years six (6)
months, then the Bank's liability shall be limited to
payment to Executive of an amount equal to a total of
ten (10) months' salary and
o if
termination occurs as aforesaid any time after the
fourth (4th) year sixth (6th) month pursuant to this
Agreement, the Bank's liability shall be limited to
payment to Executive of an amount equal to twelve (12)
months' salary.
All severance payable hereunder shall be paid in equal
monthly installments. If terminated by Bank as aforesaid, Bank
shall also
continue to provide Executive with medical insurance coverage at
Bank's cost and
expense during the period in which Bank is paying severance to
Executive,
("Severance Period").
It is understood and agreed that the severance sum and the
medical insurance shall be as and for liquidated damages in the
event of such
termination and shall cease upon death of Executive. Medical
insurance coverage
shall cease prior to expiration of the severance period upon
Executive's
obtaining employment with comparable medical insurance
coverage.
In the event that this Agreement is terminated by Bank for
Cause, Executive shall not be entitled to any severance payment, or
medical
insurance (except to the extent required by law, if any).
(ii) Termination by
Executive. In the event that Executive
terminates this Agreement after three (3) years from its effective
date and
severance is payable pursuant to this paragraph, Bank shall pay
Executive his
Base Salary up to the date of termination as well as any bonus
compensation
earned provided that Executive completes the calendar year relating
to that
bonus compensation. Executive shall not be entitled to any other
severance
payment, except that:
o if
Executive has faithfully complied with the terms of
this Agreement for a period in excess of three years,
then Executive shall be paid eight (8) months
