Exhibit 10.1
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT
(“Agreement”) is entered into on July 22, 2009, and is
effective as of August 17, 2009 (“Effective Date”), by
and between AMERISERV FINANCIAL, INC., a Pennsylvania corporation
(the “Company”), and GLENN L. WILSON, an individual
residing at 118 Little Harbor Way #202, Chestertown, MD 21620 (the
“Executive”).
PREAMBLE
The Company and the Executive wish to
establish a satisfactory employment relationship. Therefore,
the parties hereto, intending to be legally bound, agree as
follows.
AGREEMENT
1.
Employment . The Company hereby employs the Executive as
its President and Chief Executive Officer, and the Executive hereby
accepts such employment and agrees to perform all duties and accept
all responsibilities incident to the position of President and
Chief Executive Officer as may be assigned to him by the board of
directors of the Company (the “Board”).
Executive’s title shall be official within ninety (90)
days following the Effective Date. The Executive shall devote
his full time, best efforts, knowledge, and experience in
discharging his duties under this Agreement. No later than
the first meeting following the Effective Date of each of the
Board, the board of directors of AmeriServ Trust & Financial
Services Company (the “Trust Company Board”), and the
board of directors of AmeriServ Financial Bank (the “Bank
Board”), the Executive shall be appointed to the Board, the
Trust Company Board, and the Bank Board, respectively, and
thereafter during the term of this Agreement, the Company shall
cause the Executive to be nominated to the Board, the Trust Company
Board, and the Bank Board, and use its reasonable efforts to cause
the Executive to be re-elected to the Board, the Trust Company
Board, and the Bank Board.
2.
Compensation .
(a)
Salary . During the term of this Agreement, the
Company agrees to pay to the Executive a base salary at an annual
rate of Three Hundred Fifty Thousand Dollars ($350,000), payable in
twenty four (24) semi-monthly installments in accordance with the
Company’s standard payroll practice. The Executive
agrees that he will not be eligible to be considered for a merit
increase in his base salary until calendar year 2011.
(b)
Benefits . Effective August 1, 2009, the Executive shall
be entitled to participate in all health insurance and life
insurance benefit plans available on a general basis to other
non-union employees of the Company through the Company’s
Cafeteria Benefit Plan and to participate in the Company’s
Flexible Spending Program; provided, however, that the Company
reserves the right, from time to time, to amend in any respect and
to terminate all such benefit plans; and provided further that any
reduction in such benefits must be applicable to all employees
generally. Additionally, the Company will pay for up to six
(6) months of individual health care coverage under COBRA through
the Executive’s current employer for the Executive’s
22-year-old son commencing on August 1, 2009 and terminating no
later than January 31, 2010.
(c)
Additional Benefits
.
(i)
Effective August 17, 2009, the Executive
shall be entitled to participate in the Company’s long term
disability benefit plan; provided, however, that the Company
reserves the right, from time to time, to amend in any respect and
to terminate such benefit plan; and provided further that any
reduction in such benefits must be applicable to all employees
generally.
(ii)
The Executive shall be entitled to
participate in the Company’s Defined Benefit Program
effective on August 17, 2009 and in accordance with the terms of
the program; provided, however, that the Company reserves the
right, from time to time, to amend in any respect and to terminate
such benefit program; and provided further that any reduction in
such benefits must be applicable to all employees generally.
(iii)
The Executive shall be eligible to
participate in the Company’s 401(k) plan effective on October
1, 2010 and in accordance with the terms of the plan; provided,
however, that the Company reserves the right, from time to time, to
amend in any respect and to terminate such benefit plan; and
provided further that any reduction in such benefits must be
applicable to all employees generally.
(d)
Expenses . The Company will reimburse the Executive for
all reasonable expenses incurred by him in the course of performing
his duties under this Agreement which are consistent with the
Company’s policies in effect from time to time with respect
to travel, entertainment and other business expenses and to the
Company’s requirements with respect to reporting and
documentation of such expenses.
(e)
Long Term Incentive Grant
. Within thirty (30) days
following the Effective date, the Company shall grant to the
Executive the following shares of restrictive stock and stock
options:
(i)
20,000 shares of restricted stock, which
shall become 100% vested on the first anniversary of the date of
grant;
(ii)
20,000 stock options, which shall become
100% vested on the first anniversary of the date of
grant;
(iii)
30,000 shares of restricted stock, which
shall cliff vest at 100% on the third anniversary of the date of
grant; and
(iv)
40,000 stock options, which shall cliff
vest at 100% on the third anniversary of the date of
grant.
The above grants shall be governed by the
terms and conditions of the USBANCORP, Inc. 2001 Stock Incentive
Plan which was filed with the Company’s 2000 proxy statement
on March 16, 2001 and is incorporated herein by reference.
(f)
Vacation . In 2009, the Executive shall be entitled to
three (3) weeks vacation. Each year thereafter, the Executive
shall be entitled to five (5) weeks vacation. The Executive also
will be entitled to personal time on an annual basis during the
term of this Agreement, as mutually agreed upon by the Executive
and the Board.
(g)
Company Vehicle
. The Company agrees to purchase or
lease, as mutually agreed to by the Company and the Executive, a
vehicle (which shall be owned or leased by the Company) for the
Executive’s business use (and ancillary personal use).
The Company will cover all repairs and operating expenses of
said vehicle, including the cost of liability insurance,
comprehensive and collision insurance. Upon termination of
the Executive’s employment hereunder for any reason, the
Executive shall either immediately return the vehicle to the
Company or purchase the vehicle (or assume the lease) in accordance
with the Company’s vehicle purchase policy. Upon
request by the Company, the Executive shall submit to the Company
on a timely basis documentation which defines the percentage of the
Executive’s use of the vehicle which was for business
purposes.
(h)
Annual Bonuses . The Executive shall be eligible to receive
annual bonuses during the employment period, in such amounts and at
such times, if any, as may be approved by the Board in its sole
discretion. Annual bonuses, if any, shall be subject to the
limitations described under Section 111 EESA and shall not exceed
30% of the Executive’s annual base salary.
(i)
Club Membership and Dues
. During the term of this
Agreement, the Company agrees to pay the initiation fees and dues
for the Executive to be a member of the Sunnehanna Country Club and
agrees to reimburse the Executive for all ordinary, necessary, and
reasonable business-related expenses incurred by the Executive on
Company business at said country club. As a condition to
receiving such reimbursements, the Executive shall submit to the
Company on a timely basis business expense reports, including
substantiation sufficient to enable the Company to deduct the
reimbursed expenses for tax purposes.
(j)
Relocation Expenses
.
(i)
If necessary, the Company agrees to pay
all reasonable expenses associated with the moving of the
Executive’s household furnishings and personal belongings
currently located in Baltimore area, Maryland to the Johnstown,
Pennsylvania area, via a moving company mutually agreed to by the
Company and the Executive, no later than May 31, 2010.
(ii)
If necessary, the Company agrees to pay
all reasonable and documented expenses associated with the storing
of the Executive’s household furnishings from the Effective
Date through May 31, 2010, in an amount not to exceed $300 per
month.
(iii)
If necessary, the Company agrees to pay
the cost of temporary lodging in the Johnstown, Pennsylvania area
for the Executive and his family from the Effective Date through
May 31, 2010, in an amount not to exceed $1,500 per month.
(iv)
The Company agrees to reimburse the
Executive for reasonable and documented expenses incidental to the
Executive’s selling his home in the Baltimore, Maryland area,
and purchasing or constructing a home in the Johnstown,
Pennsylvania area (i.e., transfer taxes, broker’s commissions
and other closing costs, fees and expenses incurred in the sale,
purchase, or construction of the Executive’s home), in an
amount not to exceed $35,000; provided that such costs are incurred
by May 31, 2010. In addition to the foregoing, the Company
will also provide the Executive with a one-time $5,000 cash
allowance within thirty (30) days following the Effective Date for
miscellaneous expenses relating to the Executive’s move to
the Johnstown, Pennsylvania area.
(k)
No Right to Personal Loans;
Sarbanes-Oxley Compliance .
The Executive acknowledges and agrees that, notwithstanding
anything to the contrary in this Agreement, he shall not be
entitled to, and this Agreement does not confer on the Executive,
any benefits that constitute (or which, in the Company’s good
faith determination based on the advice of counsel, would likely
constitute) a personal loan in violation of Section 402 of the
Sarbanes-Oxley Act of 2002, including any implementing regulations
thereunder, or any similar provision of applicable law
(collectively, including Section 13(k)(3) of the Securities
Exchange Act of 1934, as amended (providing a limited exception to
the prohibition on loans to officers made or maintained by an
insured depository institution, if the loan is subject to the
insider lending restrictions of Section 22(h) of the Federal
Reserve Act), to the extent applicable, “Section 402”).
In the event that the Company, in good faith and upon the
advice of counsel, determines that any provision of this Agreement
would, absent this subsection, give rise to a potential violation
of Section 402, the Executive and the Company shall promptly
negotiate, in good faith, toward an appropriate amendment to this
Agreement that would eliminate such potential violation, but which
would, as closely as reasonably possible, afford both the Company
and the Executive, the same relative economic benefits of their
bargain hereunder prior to such amendment.
3.
Letter of Intent
. Subject to the terms and conditions contained
therein, the Executive shall receive a letter of intent on behalf
of the Company providing for a consulting agreement whereby the
Executive agrees to perform consulting services for the Company for
one (1) year following his involuntary termination of employment
other than for Cause or Disability and the Company agrees to
reasonably compensate the Executive for such consulting services
during such period. Such consulting agreement shall be in
compliance with the requirements of the Emergency Economic
Stabilization Act of 2008 in effect at that time. A copy of
such letter of intent is attached hereto as Exhibit A and is
incorporated herein by reference.
4.
Term of Agreement
.
(a)
Executive’s term of employment
under this Agreement shall commence on the Effective Date and shall
continue for a period of two (2) years thereafter. Commencing
on the first anniversary of the Effective Date and on each
anniversary thereafter (“Anniversary Date”), this
Agreement shall automatically be renewed for one (1) additional
year beyond the term otherwise established, unless one party
provides written notice to the other party, at least ninety (90)
days in advance of an Anniversary Date, of its intent not to renew
this Agreement for an additional one year term. Nothing in
this provision shall preclude termination as otherwise provided or
permitted under this Agreement. Any compensation payable or
benefits to be provided to the Executive between the notice of
termination and the effective date of termination shall be reduced
by any amounts received during this period by the Executive from a
third party as compensation for services. Compensation shall
not include for purposes of this subsection directors fees or
investment income attributed to the Executive’s personal
activities.
(b)
Notwithstanding the provisions of Section
4(a) of this Agreement, Company may terminate this Agreement and
Executive’s employment hereunder, at any time for Cause (as
defined below) immediately and automatically upon giving Executive
written notice of such termination. As used in this
Agreement, “Cause” shall mean any of the following
events:
(i)
a material breach of this Agreement by
the Executive that is not cured by the Executive within thirty (30)
days following the date he received written notice from the Company
of its intent to terminate his employment for Cause as a result of
such material breach;
(ii)
the Executive’s commission of any
act involving dishonesty or fraud or conduct, which brings the
Company into public disgrace or disrepute in any respect, including
but not limited to acts of dishonesty or fraud, commission of a
felony or a crime of moral turpitude;
(iii)
gross negligence or willful misconduct by
the Executive with respect to the Company or the Executive’s
continuing and unreasonable refusal to substantially perform his
duties with the Company as specifically directed by the Board;
or
(iv)
the Executive’s addiction to drugs
or alcohol if the Executive has refused treatment or has failed to
successfully complete treatment within the past twelve (12)
months.
If this Agreement, and Executive’s
employment hereunder, is terminated for Cause pursuant to the
provisions of this Section 4(b), all rights of Executive under this
Agreement (including, without limitation, rights to any
compensation or other benefits under Section 2 of this Agreement)
shall cease as of the effective date of such
termination.
(c)
Notwithstanding the provisions of Section
4(a) of this Agreement, except for provisions which by their terms
extend beyond termination of this Agreement, this Agreement shall
terminate automatically upon Executive’s voluntary
termination of employment (other than in accordance with Section 5
of this Agreement), retirement at Executive’s election, or
Executive’s death, and all rights of Executive hereunder
(including, without limitation, rights to any compensation or other
benefits under Section 2 of this Agreement) shall cease as of the
date of such voluntary termination, retirement at Executive’s
election, or death; provided, however, that, if Executive dies
after Executive delivers a Notice of Termination (as defined in
Section 5(a) of this Agreement), the provisions of Section 16(b) of
this Agreement shall apply. Executive shall provide to
Company not less than thirty (30) days prior written notice of
Executive’s voluntary termination of employment (other than
in accordance with Section 5 of this Agreement) or
retirement.
(d)
Notwithstanding the provisions of Section
4(a) of this Agreement, except for provisions which by their terms
extend beyond termination of this Agreement, this Agreement and
Executive’s employment hereunder shall terminate
automatically upon Executive’s Disability and all of
Executive’s rights under this Agreement (including, without
limitation, rights to any compensation or other benefits under
Section 2 of this Agreement) shall cease as of the date of such
termination; provided, however, that, if Executive becomes Disabled
after Executive delivers a Notice of Termination (as defined in
Section 5(a) of this Agreement), Executive shall nevertheless be
absolutely entitled to receive all of the compensation and benefits
provided for in, and for the term set forth in, Section 6 of this
Agreement. For purposes of this Agreement,
“Disability” shall mean a mental or physical
disability, illness or incapacity of the Executive which renders
the Executive unable to perform a substantial portion of his duties
as an employee of the Company for a period of three (3) consecutive
months or an aggregate period of six (6) months in any eighteen
month period or that renders the Executive unable to earn a
livelihood as an employee of a business comparable to the
Company’s business, unless further time is required as a
reasonable accommodation under the Americans with Disabilities Act.
The Company shall provide to the Executive not less than
thirty (30) days prior written notice of its intent to terminate
his employment for Disability.
(e)
Executive agrees that, in the event his
employment under this Agreement terminates for any reason,
Executive shall concurrently resign as a director of the Company
and any of its respective affiliates, if he is then serving as a
director of any of such entities.
5.
Termination of Employment Following
Change in Control .
(a)
If a Change in Control (as defined in
Section 5(b) of this Agreement) shall occur and if thereafter, at
any time during the term of this Agreement, there shall
be:
(i)
any involuntary termination of
Executive’s employment (other than for Cause or
Disability);
(ii)
a reduction in the Executive’s
title, responsibilities, including reporting responsibilities, or
authority, including such title, responsibilities, or authority as
such may have been increased from time to time during the term of
this Agreement, which results in a material negative change to the
Executive in the employment relationship;
(iii)
the assignment of the Executive to duties
inconsistent with his office as existed on the day immediately
prior to the date of a Change in Control, which results in a
material negative change to the Executive in the employment
relationship;
(iv)
a reduction in the Executive’s
annual base salary in effect on the day immediately prior to the
date of the Change in Control;
(v)
a termination of the Executive’s
participation, on substantially similar terms, in any incentive
compensation or bonus plans of the Company in which the Executive
participated immediately prior to the Change in Control, or any
change or amendment to any of the substantive provisions of any of
such plans which would materially decrease the potential benefits
to the Executive under any of such plans;
(vi)
a failure by the Company to provide the
Executive with benefits at least as favorable as those enjoyed by
the Executive under any pension, life insurance, medical, health
and accident, disability or other employee plans of the Company in
which the Executive participated immediately prior to the Change in
Control, or the taking of any action by the Company that would
materially reduce any of such benefits in effect at the time of the
Change in Control, unless such reduction relates to a reduction in
benefits applicable to all employees generally; or
(vii)
a material breach of this Agreement by
the Company,
then, at the option of the Executive,
exercisable by the Executive within ninety (90) days of the
occurrence of any of the foregoing events, the Executive may resign
from employment with the Company (or, if involuntarily terminated,
give notice of intention to collect benefits under this Agreement)
by delivering a notice in writing (the “Notice of
Termination”) to the Company and the provisions of Section 6
of this Agreement shall apply, provided, however, that such
resignation by the Executive shall become effective only if the
Company does not cure the relevant event (excluding the event
listed in Section 5(a)(i)) within thirty (30) days of such Notice
of Termination. Notwithstanding the foregoing, any amounts
payable upon a termination under this Section shall be paid only if
the Executive actually terminates employment within two (2) years
following the initial existence of the above-referenced event(s)
which gives rise to such termination.
(b)
As used in this Agreement, “Change
in Control” shall mean the occurrence of any of the
following:
(i)
If during the term of this Agreement any
“person” or “group” which is not an
affiliate of the Company (as those terms are defined or used in
Section 13(d) of the Securities Exchange Act of 1934 (the
“Exchange Act”), as enacted and in force on the date
hereof) is or becomes the “beneficial owner” (as that
term is defined in Rule 13d-3 under the Exchange Act, as enacted
and in force on the date hereof) of securities of the Company
representing fifty percent (50%) or more of the combined voting
power of the Company’s securities then outstanding;
or
(ii)
If during the term of this Agreement
there occurs a merger, consolidation, share exchange, division or
other reorganization involving the Company and another entity which
is not an affiliate of the Company in which the Company’s
shareholders do not continue to hold a majority of the capital
stock of the resulting entity, or a sale, exchange, transfer, or
other disposition of substantially all of the assets of the Company
to another entity or other person which is not an affiliate of the
Company.
(c)
Anything in this Agreement to the
contrary notwithstanding, if the Executive’s employment with
the Company is terminated prior to the date on which a Change in
Control occurs by the Company other than for Cause or Disability
and it is reasonably demonstrated that such termination of
employment (i) was at the request of a third party who has taken
steps reasonably calculated to effect the Change in Control or (ii)
otherwise arose in connection with or anticipation of the Change in
Control, then for all purposes of this Section, the termination
shall deemed to have occurred upon a Change in Control and the
Executive will be entitled to the compensation and benefits
provided for in Section 6 hereof. Notwithstanding the
foregoing, any benefits received by the Executive as a result of a
termination of employment under this Section 5(c) shall be offset
by any benefits received by the Executive under Section
7.
6.
Rights in Event of Termination of
Employment Following Changes in Control .
(a)
In the event that the Executive delivers
a Notice of Termination (as defined in Section 5(a) of this
Agreement) after the occurrence of a Change in Control or if the
Executive’s employment terminates pursuant to Section
5(c),
(i)
the Executive shall be entitled to
receive a lump-sum cash payment within thirty (30) days following
the date of termination in an amount equal 2.99 times the
Executive’s annual base salary then in effect (or immediately
prior to any reduction resulting in a termination under Section
5(a)(iv));
(ii)
for the three (3) year period immediately
following the date of termination, the Company shall arrange to
provide the Executive (which includes the Executive’s
eligible dependents) with health insurance benefits substantially
similar to those which the Executive was receiving immediately
prior to the date of termination (or immediately prior to any
reduction resulting in a termination under Section 5(a)(vi));
provided, however, that (A) the Executive’s and his qualified
dependents’ COBRA eligibility period shall include the period
during which the Company is providing benefits under this
subsection; and (B) the Executive shall be responsible for the
payment of premiums for such benefits in the same amount as active
employees of the Company (including any changes in amounts paid by
active employees through the continuation period); and
(iii)
the Executive shall be entitled to a lump
sum cash payment, payable within thirty (30) days following the
date of termination in an amount equal to the excess of (A) the
aggregate retirement benefits he would have received under the
terms of each tax-qualified and non-qualified plan of the Company
as in effect immediately prior to the Executive’s date of
termination as if he continued to be employed for three (3) more
years, and had he received (on a pro-rated basis, as appropriate)
the greater of (I) the highest compensation taken into account
under each such plan with respect to one of the three (3) years
immediately preceding the year in which the date of termination
occurs, or (II) his annualized base compensation in effect
immediately prior to the date of termination (or immediately prior
to any reduction resulting in a termination under Section
5(a)(iv)), over (B) the retirement benefits he actually receives
under such plans.
7.
Rights in Event of Termination of
Employment absent Change in Control .
(a)
In the event that the Executive’s
employment is terminated by the Company other than for Cause or
Disability or by the Executive for Good Reason (as defined below),
and no Change in Control shall have occurred at the date of such
termination,
(i)
the Executive shall be entitled to
receive a lump-sum cash payment within thirty (30) days following
the date of termination in an amount equal two (2) times the
Executive’s annual base salary then in effect; and
(ii)
for the two (2) year period immediately
following the date of termination, the Company shall arrange to
provide the Executive (which includes the Executive’s
eligible dependents) with health insurance benefits substantially
similar to those which the Executive was receiving immediately
prior to the date of termination; provided, however, that (A) the
Executive’s and his qualified dependents’ COBRA
eligibility period shall include the period during which the
Company is providing benefits under this subsection; and (B) the
Executive shall be responsible for the payment of premiums for such
benefits in the same amount as active employees of the Company
(including any changes in amounts paid by active employees through
the continuation period).
(b)
Executive shall be considered to have
terminated employment hereunder for “Good Reason” if
such termination of employment occurs absent a Change in Control
and is on account of a reduction in the Executive’s annual
base salary except for (i) across-the-board salary reductions
similarly affecting all salaried employees of the Company or (ii)
across-the-board salary reductions similarly affecting all senior
executive officers of the Company. The Executive’s
right to terminate employment for Good Reason shall be subject to
the following conditions: (i) any amounts payable upon a Good
Reason termination shall be paid only if the Executive actually
terminates employment within two (2) years following the initial
existence of the Good Reason event and (ii) the Executive must
provide written notice to the Company of the Good Reason event
within ninety (90) days of the initial existence of the event and
the Company must be given at least thirty (30) days to remedy such
situation.
8.
Requirement of Release
. Notwithstanding anything in this
Agreement to the contrary, the Executive’s entitlement to any
payments under this Agreement other than the Executive’s
accrued but unpaid base compensation and any accrued but unpaid or
otherwise vested benefits under any benefit or incentive plan
determined at the time of the Executive’s termination of
employment shall be contingent upon the Executive’s prior
agreement with and signature to a complete release and hold
harmless agreement (the form of which is attached hereto as
Exhibit B ) which shall completely release the Company, its
parent, affiliates, officers, directors and employees (collectively
the “Released Parties” and individually a
“Released Party”) and which shall forever waive all
claims of any nature that the Executive may have against any
Released Party, including without limitation all claims arising out
of Executive’s employment within the Company or the
termination of that employment.
9.
Restrictive Covenants
.
(a)
During the Executive’s employment
with the Company and, if the Executive receives severance benefits
under Sections 6 or 7 of this Agreement, for a period of two (2)
years thereafter:
(i)
the Executive shall not directly for
himself or any third party, become engaged in any business or
activity which is directly in competition with any services or
products sold by, or any business or activity engaged in by, the
Company or any of its affiliates within Cambria county or any of
the counties contiguous with Cambria county as well as Centre,
Allegheny and Chester counties; provided, however, that this
provision shall not restrict the Executive from owning or investing
in a publicly traded institution, so long as his aggregate holdings
in any such institution do not exceed 5% of the outstanding capital
stock of such institution; and
(ii)
the Executive shall not solicit any
person who was a customer of the Company or any of its affiliates
during the period of the Executive’s employment hereunder, or
solicit potential customers who are or were identified through
leads developed during the course of employment with the Company,
or otherwise divert or attempt to divert any existing business of
the Company or any of its affiliates; and
(iii)
the Executive shall not, directly for
himself or any third party, solicit, induce, recruit or cause
another person in the employment of the Company or any of
its
