Exhibit 10.10
EXECUTIVE EMPLOYMENT
AGREEMENT
THIS AGREEMENT is made to be
effective as of March 1, 2009 (the “Effective
Date”), by and among ORRSTOWN BANK, a Pennsylvania banking
institution (the “Bank”), ORRSTOWN FINANCIAL SERVICES,
INC., a Pennsylvania business corporation (the
“Corporation”), and THOMAS RODNEY QUINN, JR., an adult
individual (the “Executive”).
RECITALS:
WHEREAS, the Bank is a subsidiary of
the Corporation; and,
WHEREAS, the Corporation and the
Bank each desire to employ the Executive and Executive desires to
accept such employment, all upon the terms and conditions set forth
in this Agreement.
AGREEMENTS:
NOW, THEREFORE, in consideration of
the mutual covenants and agreements set forth herein and intending
to be legally bound hereby, the parties agree as
follows:
1. EMPLOYMENT AND EMPLOYMENT
TERM. The Corporation and Bank hereby shall employ the
Executive and the Executive hereby accepts employment with the
Corporation and the Bank under and pursuant to this Agreement for a
term beginning as of the Effective Date and ending
February 28, 2011 (the “Term”), unless sooner
terminated as hereinafter provided.
2. POSITION, DUTIES, AND PLACE OF
EMPLOYMENT. The Executive shall serve as President-Elect of the
Corporation and the Bank from the Effective Date until the
completion of the annual meeting of shareholders of the Corporation
to be held on or about May 5, 2009, and, in such capacity,
shall report to the Board of Directors of the Corporation and the
Bank and have such other powers and duties as may from time to time
be prescribed by the Board of Directors of the Corporation and the
Bank. Beginning with the completion of the annual meeting of
shareholders of the Corporation to be held on or about May 5,
2009 through the balance of the Term of this Agreement, the
Executive shall serve as the President and Chief Executive Officer
of the Corporation and the Bank, reporting only to the Boards of
Directors of the Corporation and the Bank, and shall have
supervision and control over, and responsibility for, the general
management and operation of the Corporation and the Bank, and shall
have such other powers and duties as may from time to time be
prescribed by the Boards of Directors of the Corporation and the
Bank. The Executive’s primary office shall be located at 77
East King Street, Shippensburg, Pennsylvania, or at such place as
the Board of Directors shall determine.
3. ENGAGEMENT IN OTHER
EMPLOYMENT. The Executive shall devote all of his ability and
attention to the business of the Corporation and the Bank during
the Term of this Agreement. The Executive shall, during the Term of
this Agreement, notify in writing and receive written approval from
the Boards of Directors of the Corporation and the Bank before the
Executive may engage in any other business or commercial
activities, duties or pursuits, including, but not limited to,
directorships of other companies. Subject to prior written notice
to the Boards of Directors of the Corporation and the Bank, the
Executive shall not be precluded from engaging in voluntary or
philanthropic endeavors or from engaging in activities incident or
necessary to personal investments, so long as they are, in the
reasonable opinion of such Boards of Directors, not in conflict
with or detrimental to the Executive’s rendition of services
on behalf of the Bank and Corporation.
4. COMPENSATION
(a) Base Salary During the
Term of this Agreement, the Bank shall pay to the Executive an
annual base salary at a rate of $375,000.00 per year (the
“Base Salary”). The Executive’s Base Salary shall
be reviewed annually by the Compensation Committee of the Board of
Directors of the Bank (or such other committee as performs such
functions) pursuant to its performance review policies then in
effect for senior executives. The term “Base Salary” as
used in this Agreement shall refer to the Base Salary as in effect
from time to time. The Bank shall pay the Base Salary to Executive
in equal installments pursuant to the Bank’s standard payroll
policies and Executive’s Base Salary shall be subject to such
withholding or deductions as may be mutually agreed between the
Bank and Executive or required by law. The Base Salary shall be pro
rated in any calendar year during which the Executive is employed
hereunder for less than the entire such year in accordance with the
number of days in such calendar year during which he is so
employed.
(b) Annual Incentive
Payments. With respect to each fiscal year of the Corporation
and the Bank ending during the Term of this Agreement, the
Executive shall be eligible to receive an annual incentive payment
as determined by the Compensation Committee in accordance with the
Corporation’s Executive Incentive Plan.
(c) Equity Awards. During the
Term of this Agreement, the Executive shall be eligible to receive
annual equity incentive awards under the terms and conditions of
the Corporation’s equity-based compensation plans to the
extent the President and Chief Executive Officer of the Corporation
and the Bank immediately preceding the Executive in that position
was eligible to receive such awards or, to the extent the preceding
President and Chief Executive Officer was not so eligible, then to
the extent the other senior executives of the Corporation are
eligible to receive such awards.
(d) Senior Executive
Benefits. During the Term of this Agreement, in addition to the
employee benefits to be made available pursuant to
Section 5(b), the Executive also shall be eligible to
participate in any retirement plan, deferred compensation plan,
welfare benefit plan or other benefit program as and to the extent
the President and Chief Executive Officer of the Corporation and
the Bank immediately preceding the Executive in that position was
eligible to participate in any such program, plan or arrangement
or, to the extent the preceding President and Chief Executive
Officer was not so eligible, then to the extent the other senior
executives of the Corporation are eligible to
participate.
5. FRINGE BENEFITS, EXPENSES AND
PERQUISITES.
(a) Relocation Allowance. In
connection with Executive’s commencement of employment with
the Corporation and the Bank, the Bank will provide to Executive a
relocation allowance of $55,000.00 which shall include:
(i) reimbursement for moving expenses to the Carlisle,
Shippensburg, Chambersburg, Pennsylvania area;
(ii) reimbursement for temporary living expenses in the
Shippensburg area for up to six (6) months after the Effective
Date; (iii) and reimbursement for up to six (6) months of
commercial coach air fare and other reasonable travel related
expenses for travel to and from Executive’s primary personal
residence in Bonita Springs, Florida subsequent to the Effective
Date. Except as to permitted reimbursements pursuant to this
Section 5(a), Executive shall be solely responsible for any
and all moving, temporary living, travel and other relocation
expenses incurred by Executive in connection with relocating
himself and his family from Bonita Springs, Florida to the
Carlisle, Shippensburg, Chambersburg, Pennsylvania area.
(b) Employee Benefit Plans.
During the Term of this Agreement, the Executive shall be eligible
to participate in or receive benefits under all Bank employee
benefit plans including, but not limited to, any pension plan,
profit-sharing plan, savings plan, life insurance plan,
medical/health insurance plan, disability insurance plan and other
health and welfare benefits as made available by the Bank to its
full time employees generally, subject to and on a basis consistent
with the terms, conditions and overall administration of such plans
and arrangements, and provided, further that such participation
does not violate any state or federal law, rule or
regulation.
(c) Business Expenses. During
the Term of this Agreement, the Executive shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred
by him (in accordance with the policies and procedures established
by the Board of Directors of the Corporation and the Bank for its
senior executive officers) in performing services hereunder,
provided that the Executive properly accounts therefore in
accordance with Corporation and Bank policy.
(d) Vacation, Holidays, Sick Days
and Personal Days. The Executive shall be entitled to four
weeks (twenty (20) business days) paid vacation in each
calendar year determined by the Bank from time to time for its
senior executive officers (pro rated in any calendar year during
which the Executive is employed hereunder for less than the entire
such year). The Executive also shall be entitled to all paid
holidays, sick days and personal days provided by the Bank to its
regular full time employees and senior executive
officers.
(e) Automobile. The Executive
shall be entitled to the use of a Bank provided automobile and the
Bank shall pay all expenses relating thereto, including fuel, oil,
maintenance and insurance. The use of said automobile shall be
limited to the Executive, his spouse, authorized Bank personnel, or
a designated driver in the event of an emergency.
(f) Membership Dues. During
the term of this Agreement, the Bank shall reimburse to the
Executive the initiation fee, “family” membership dues
and member assessments to either the Carlisle Country Club or the
Chambersburg County Club, as selected by the Executive (the
“Club”), incurred by the Executive to obtain and
maintain membership in such Club. Business expenses incurred by
Executive at the Club shall be subject to reimbursement in
accordance with the reimbursement policies adopted by the Bank for
its senior executive officers.
6. BOARD OF DIRECTORS. At the
annual reorganization meetings of the Boards of Directors of the
Corporation and the Bank to be held on or about May 5, 2009,
the Corporation and the Bank each agree to elect the Executive to
their respective Board of Directors and, thereafter, during the
Term of this Agreement, the Corporation agrees to cause the
Executive to be elected as a director on the Board of Directors of
the Bank and to nominate Executive for election as a director on
the Board of Directors of the Corporation in connection with each
election of directors of the Corporation wherein his term of office
otherwise would expire. The Executive agrees to serve with no
additional compensation as a director on the Boards of Directors of
the Corporation and of the Bank and, if elected or appointed
thereto, in one or more offices or as a director of any subsidiary
of the Corporation or the Bank. In the event Executive’s
employment under this Agreement would be terminated by the
Employers for Cause (as hereinafter defined) or by Executive
without Good Reason (as hereinafter defined), Executive agrees to
resign, effective as of the date of termination and in writing,
from all of the director and officer positions then held by him
under this Section 6.
7. NON-DISCLOSURE/TRADE
SECRET. The Executive covenants and agrees that while employed
by the Corporation and the Bank and at any time thereafter, the
Executive shall not, without the written consent of the Board of
Directors of the Corporation or Bank or a person authorized
thereby, knowingly disclose to any person, other than an employee
of the Corporation or Bank or a person to whom disclosure is
reasonably necessary or appropriate in connection with the
performance by the Executive of his duties as an executive of the
Corporation or Bank, any confidential information obtained by the
Executive while in the employ of the Corporation or Bank with
respect to any of the Corporation’s or Bank’s services,
products, improvements, formulas, designs or styles, processes,
customers, methods of business or any business practices, the
disclosure of which could be or will be materially damaging to the
Corporation or Bank, provided, however, that confidential
information shall not include any information known generally to
the public (other than as a result of authorized disclosure by the
Executive or any person with the assistance, consent or direction
of the Executive) or any information of a type not otherwise
considered confidential by persons engaged in the same business or
a business similar to that conducted by the Corporation or Bank or
any information that must be disclosed as required by
law.
8. RESTRICTIVE COVENANT. The
Executive covenants and agrees that while employed by the
Corporation and the Bank and for a period of one (1) year
after the termination of Executive’s employment, either
voluntarily or involuntarily, the Executive shall not directly or
indirectly, within the marketing area of the Corporation and the
Bank (defined as the area within an eighty (80) mile radius of
Shippensburg, Pennsylvania) enter into or engage generally in
direct or indirect competition with the Corporation and the Bank or
any subsidiary of the Corporation or the Bank, either as an
individual on his own or as a partner or joint venturer, or as a
director, officer, shareholder, employee, agent, independent
contractor, lessor or creditor of or for any person. The foregoing
restriction shall not be construed to prohibit the ownership by
Executive of not more than five (5%) percent of any class of
securities of any corporation which is in competition with the
Corporation or the Bank, provided that such ownership represents a
passive investment and that neither Executive nor any group of
persons including Executive in any way, either directly or
indirectly, manages or exercises control of any such corporation,
guarantees any of its financial obligations, otherwise takes any
part in its business, other than exercising his rights as a
shareholder, or seek to do any of the foregoing.
9. NON-SOLICITATION.
Executive covenants and agrees that while employed by the
Corporation and the Bank and for a period of one (1) year
after the termination of Executive’s employment, either
voluntarily or involuntarily, Executive shall not, either directly
or indirectly in any capacity whatsoever, (a) obtain, solicit,
divert, appeal to, attempt to obtain, attempt to solicit, attempt
to divert, or attempt to appeal to any customers, clients or
referral sources of the Corporation, the Bank or any of their
respective subsidiaries to divert their business from the
Corporation, the Bank or any of their respective subsidiaries;
(b) solicit any person who is employed by the Corporation, the
Bank or any of their respective subsidiaries to leave the employ of
the Corporation, the Bank or any of their respective subsidiaries.
For purposes of this covenant, “customers, clients, and
referral sources” shall include all persons who are or were
customers, clients or referral sources of the Corporation, the Bank
or any of their respective subsidiaries at any time during the
employment of Executive by the Corporation and the Bank. The
non-solicitation covenant set forth in this Section 9 shall
not be construed to prohibit a general advertising or marketing
program directed toward the marketing area of the Corporation and
the Bank by any subsequent employer of Executive.
10. NOTIFICATION OF A
NON-DISCLOSURE/TRADE SECRET, RESTRICTIVE COVENANT AND
NO-SOLICITATION PROVISIONS. During his employment and for a
period of one (1) year following termination of his employment
with the Corporation and the Bank, either voluntarily or
involuntarily, Executive agrees to inform any prospective employer
of the existence of the Non-Disclosure/Trade Secret, Restrictive
Covenant and Non-Solicitation provisions of this
Agreement.
11. MUTUAL NONDISPARAGEMENT.
The Executive, the Corporation and the Bank eac
