Exhibit 10.1
EMPLOYMENT
AGREEMENT
FOR
CHARLES E. WELLER
This Employment Agreement (the
“Agreement”) is made effective as of the 1
st day of July, 2009 (the “Effective
Date”), by and between OBA Bank (the “Bank”), a
federally chartered stock savings bank that is headquartered in
Germantown, Maryland, and Charles E. Weller
(“Executive”). The Bank is a wholly-owned subsidiary of
OBA Bancorp, Inc., a federal stock corporation (the
“Company”). The Company has executed this Agreement for
the sole purpose of guaranteeing the Bank’s financial
performance hereunder.
WITNESSETH
WHEREAS , the Executive is currently employed as
President and Chief Executive Officer of the Bank;
WHEREAS , OBA Bancorp, MHC, the mutual holding company
of the Bank, has adopted a Plan of Conversion pursuant to which the
Bank will become a wholly-owned subsidiary of a newly-formed stock
holding company which will be the successor to the
Company;
WHEREAS , the Bank desires to assure itself of the
continued availability of the Executive’s services as
provided in this Agreement; and
WHEREAS , the Executive is willing to serve the Bank on
the terms and conditions hereinafter set forth.
NOW THEREFORE
, in consideration of the mutual
agreements herein contained, and upon the other terms and
conditions hereinafter provided, the Bank and the Executive hereby
agree as follows:
1. POSITION AND
RESPONSIBILITIES
During the term of this Agreement
Executive agrees to serve as President and Chief Executive Officer
of the Bank, and will perform all duties and will have all powers
that are generally incident to the office of the President and
Chief Executive Officer. Without limiting the generality of the
foregoing, Executive will be responsible for the overall management
of the Bank, and will be responsible for establishing the business
objectives, policies and strategic plans of the Bank in conjunction
with the Board of Directors (the “Board”) of the Bank.
Executive also will be responsible for providing leadership and
direction to all departments or divisions of the Bank, and will be
the primary contact between the Board and other officers and
employees of the Bank. As President and Chief Executive Officer,
Executive will report directly to the Board. Executive also agrees
to serve, if appointed or elected, as a director of the Bank or the
Company, and as an officer and/or director of any subsidiary or
affiliate of the Bank or the Company. So long as Executive is an
officer of the Bank or the Company, Executive shall not be entitled
to any fees for service as a director of the Bank or the Company or
any subsidiary or affiliate of the Bank or the Company.
2. TERM
(a) Term and Annual
Review . The term of
this Agreement will begin as of the Effective Date and will
continue for thirty-six (36) full calendar months thereafter.
Commencing on the first anniversary date of the Effective Date of
this Agreement (the “Anniversary Date”) and continuing
on each Anniversary Date thereafter, members of the Board who are
not executive officers of the Bank may extend the term of this
Agreement for an additional year such that the remaining term shall
be thirty-six (36) months, unless written notice of
non-renewal is provided to Executive at least thirty (30) days
prior to any such Anniversary Date, in which case the term of this
Agreement will become fixed and will terminate at the end of the
thirty-six (36) months following such Anniversary Date. Prior
to each Anniversary Date, the members of the Board who are not
executive officers of the Bank will conduct a comprehensive
performance evaluation and review of Executive for purposes of
determining whether to extend this Agreement, and the results
thereof will be included in the minutes of the Board’s
meeting.
(b) Continued Employment
Following Expiration of Term . Nothing in this Agreement shall mandate or
prohibit a continuation of Executive’s employment following
the expiration of the term of this Agreement, upon such terms and
conditions as the Bank and Executive may mutually agree.
3. LOYALTY AND OUTSIDE
ACTIVITIES
During the period of his employment
hereunder, except for periods of absence occasioned by illness,
reasonable vacation periods, and reasonable leaves of absence,
Executive will devote all of his business time, attention, skill
and efforts to the faithful performance of his duties under this
Agreement, including activities and duties directed by the Board.
Notwithstanding the preceding sentence, subject to the approval of
the Board, Executive may serve as a member of the board of
directors of business, community and charitable organizations,
provided that in each case such service shall not materially
interfere with the performance of his duties under this Agreement,
adversely affect the reputation of the Bank, or present any
conflict of interest. Executive will present annually to the Board
for its review and approval, a list of organizations in which
Executive is participating or proposes to participate. Such service
to and participation in outside organizations will be presumed for
these purposes to be for the benefit of the Bank, and the Bank will
reimburse Executive his reasonable expenses associated therewith,
to the extent Executive’s expenses are not reimbursed by such
organizations.
4. COMPENSATION AND
REIMBURSEMENT
(a) Base Salary
. In consideration of
Executive’s performance of the responsibilities and duties
set forth in Section 1, the Bank will provide Executive the
compensation specified in this Agreement. The Bank will pay
Executive a salary of $250,000 per year (“Base
Salary”). Such Base Salary will be payable in accordance with
the customary payroll practices of the Bank. During the period of
this Agreement, the Board, or a Committee designated by the Board,
will review Executive’s Base Salary at least annually, and
the Board may increase, but not
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decrease Executive’s Base Salary (except
for a decrease that is not in excess of any decrease that is
generally applicable to all employees of the Bank). Any increase in
Base Salary will become the “Base Salary” for purposes
of this Agreement.
(b) Bonus and Incentive
Compensation .
Executive will be entitled to participate in any incentive
compensation and bonus plans or arrangements of the Bank. Such
incentive compensation will be paid in cash in accordance with the
terms of such plans or arrangements, or on a discretionary basis by
the Board or a Committee designated by the Board. Nothing paid to
Executive under any such plans or arrangements will be deemed to be
in lieu of other compensation to which Executive is entitled under
this Agreement.
(c) Benefit
Plans . Executive
will be entitled to participate in all employee benefit plans,
arrangements and perquisites substantially equivalent to those in
which Executive was participating or otherwise deriving benefit
from immediately prior to the beginning of the term of this
Agreement. The Bank will not, without Executive’s prior
written consent, make any changes in such plans, arrangements or
perquisites which would adversely affect Executive’s rights
or benefits thereunder (other than a change or reduction that would
apply uniformly to other participating officers and employees of
the Bank). Without limiting the generality of the foregoing
provisions of this Section 4(c), Executive also will be
entitled to participate in any employee benefit plans including,
but not limited to, stock benefit plans, retirement plans,
supplemental retirement plans, pension plans, profit-sharing plans,
health-and-accident plans, medical coverage or any other employee
benefit plan or arrangement made available by the Bank in the
future to its senior executives and key management employees,
subject to and on a basis consistent with the terms, conditions and
overall administration of such plans and arrangements.
(d) Health, Dental, Life and
Disability Coverage .
Bank shall provide Executive with life, medical, dental and
disability coverage made available by Bank to its senior executives
and key management employees, subject to and on a basis consistent
with the terms conditions and overall administration of such
coverage.
(e) Vacation and
Leave . Executive
will be entitled to paid vacation time each year during the term of
this Agreement (measured on a fiscal or calendar year basis, in
accordance with the Bank’s usual practices), as well as sick
leave, holidays and other paid absences in accordance with the
Bank’s policies and procedures for senior executives. Any
unused paid time off during an annual period will be treated in
accordance with the Bank’s personnel policies as in effect
from time to time.
(f) Expense
Reimbursements .
During the term of this Agreement, the Bank will reimburse
Executive for all reasonable travel, entertainment and other
reasonable expenses incurred by Executive during the course of
performing his obligations under this Agreement, including, without
limitation, fees for memberships in such organizations as Executive
and the Board mutually agree are necessary and appropriate in
connection with the performance of his duties under this Agreement,
upon substantiation of such expenses in accordance with applicable
policies and procedures of the Bank.
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5. WORKING FACILITIES
Executive’s principal place of
employment will be at the Bank’s principal executive offices.
The Bank will provide Executive at his principal place of
employment, a private office, secretarial and other support
services and facilities suitable to his position with the Bank and
necessary or appropriate in connection with the performance of his
duties under this Agreement.
6. TERMINATION AND TERMINATION
PAY
Subject to Section 7 of this
Agreement which governs a termination in the event of a Change in
Control, Executive’s employment under this Agreement may be
terminated in the following circumstances:
(a) Death
. Executive’s employment under
this Agreement will terminate upon his death during the term of
this Agreement, in which event Executive’s estate or
beneficiary will receive the compensation due to Executive through
the last day of the calendar month in which his death occurred, and
the Bank will continue to provide for Executive’s family
medical and dental benefits for one (1) year after
Executive’s death, substantially comparable to the coverage
maintained by the Bank for Executive and his family prior to his
death.
(b) Retirement
. This Agreement will terminate upon
Executive’s “Retirement” from employment with the
Bank. Executive will not be entitled to the termination benefits
specified in Section 6 hereof in the event of termination due
to Retirement (but may be entitled to the termination benefits
specified in Section 7 hereof). For purposes of this
Section 6, termination of Executive’s employment upon
Retirement shall include termination of Executive’s
employment by the Board for any reason after Executive attains the
age of sixty-seven (67).
(c) Disability
.
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(i)
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The Board may
terminate Executive’s employment after having determined
Executive is “Disabled.” For purposes of this
Agreement, Executive will be considered “Disabled” and
the Board will have the right to terminate this Agreement due to
Executive’s Disability, in any case in which it is
determined: (A) by a duly licensed physician selected by the
Bank, that Executive is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death, or last for a
period of not less than 12 months, (B), or by reason of the
condition described in “(A),” the Executive is
receiving income replacement benefits for a period of not less than
three months under an accident and health plan covering employees
of the Bank, or (C) by the Social Security Administration,
that Executive is disabled.
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(ii)
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In the event the Board determines
that Executive is Disabled, Executive will no longer be obligated
to perform services under this Agreement. Upon Executive’s
termination due to Disability, the Bank will cause to be continued
life insurance and non-taxable medical and dental coverage
substantially comparable to the coverage maintained by the Bank
for
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Executive prior to his
termination, provided, however, such medical and dental coverage
shall cease upon the earlier of (i) three (3) years from
the date of termination or (ii) the date Executive becomes
eligible for Medicare coverage; provided further that if Executive
is covered by family coverage or coverage for self and a spouse,
then Executive’s family or spouse shall continue to be
covered for the remainder of the three (3) year period, or in
the case of the spouse, until the spouse becomes eligible for
Medicare coverage or obtains health care coverage elsewhere,
whichever period is less.
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(d) Termination for
Cause.
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(i)
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The Board may
by written notice to Executive in the form and manner specified in
this paragraph, immediately terminate his employment at any time
for “Cause.” Executive shall have no right to receive
compensation or other benefits for any period after termination for
Cause, except for already vested benefits. Termination for Cause
shall mean termination because of, in the good faith determination
of the Board, Executive’s:
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(4)
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breach of
fiduciary duty involving personal profit;
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(5)
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material breach
of the Bank’s Code of Ethics;
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(6)
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material
violation of the Sarbanes-Oxley requirements for officers of public
companies that in the reasonable opinion of the Board will likely
cause substantial financial harm or substantial injury to the
reputation of the Bank;
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(7)
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intentional
failure to perform stated duties under this Agreement after written
notice thereof from the Board;
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(8)
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willful
violation of any law, rule or regulation (other than traffic
violations or similar offenses) that reflect adversely on the
reputation of the Bank, any felony conviction, any violation of law
involving moral turpitude, or any violation of a final
cease-and-desist order; or
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(9)
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material breach
by Executive of any provision of this Agreement.
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(ii)
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For purposes of this
Section 6(d), no act or failure to act, on the part of
Executive, shall be considered “willful” unless it is
done, or omitted to be done, by Executive in bad faith or without
reasonable belief that
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Executive’s action or
omission was in the best interests of the Bank. Any act, or failure
to act, based upon the direction of the Board or based upon the
advice of counsel for the Bank shall be conclusively presumed to be
done, or omitted to be done, by Executive in good faith and in the
best interests of the Bank.
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(iii)
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Notwithstanding
the foregoing, Executive’s termination for Cause will not
become effective unless a majority of the entire membership of the
Board has adopted a resolution terminating Executive for Cause and
finding that, in the good faith opinion of the Board, Executive was
guilty of the conduct described above.
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(e) Voluntary Termination by
Executive . In
addition to his other rights to terminate his employment under this
Agreement, Executive may voluntarily terminate employment during
the term of this Agreement upon at least sixty (60) days prior
written notice to the Board. Upon Executive’s voluntary
termination, he will receive only his compensation and vested
rights and benefits to the date of his termination. Following his
voluntary termination of employment under this Section 6(e),
Executive will be subject to the restrictions set forth in Sections
9(a) and 9(b) of this Agreement.
(f) Termination Without Cause
or With Good Reason .
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(i)
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In addition to
termination pursuant to Sections 6(a) through 6(e), the Board may,
by written notice to Executive, immediately terminate his
employment at any time for a reason other than Cause (a termination
“Without Cause”), and Executive may, by written notice
to the Board, terminate this Agreement at any time within sixty
(60) days following an event constituting “Good
Reason,” as defined below (a termination “With Good
Reason”); provided, however, that the Bank shall have thirty
(30) days to cure the “Good Reason” condition, but
the Bank may waive its right to cure. Any termination of
Executive’s employment, other than Termination for Cause,
shall have no effect on or prejudice the vested rights of Executive
under the Bank’s qualified or non-qualified retirement,
pension, savings, thrift, profit-sharing or stock bonus plans,
group life, health (including hospitalization, medical and major
medical), dental, accident and long term disability insurance plans
or other employee benefit plans or programs, or compensation plans
or programs in which Executive was a participant.
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(ii)
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In the event of
termination under this Section 6(f), Executive will receive a
cash lump sum payment equal to three (3) times the sum of
(i) his Base Salary and (ii) highest rate of bonus paid
during the three years prior to his termination of employment. Such
severance payment shall be paid within thirty (30) days
following Executive’s termination of employment.
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(iii)
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In addition, the Bank will
provide, at no cost to Executive, life insurance and non-taxable
medical and dental coverage substantially comparable to
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the coverage maintained by the
Bank for Executive prior to his termination, provided, however,
such medical and dental coverage shall cease upon the earlier of
(i) three (3) years from the date of termination or
(ii) the date Executive becomes eligible for Medicare
coverage; provided further that if Executive is covered by family
coverage or coverage for self and a spouse, then Executive’s
family or spouse shall continue to be covered for the remainder of
the three (3) year period, or in the case of the spouse, until
the spouse becomes eligible for Medicare coverage or obtains
healthcare coverage elsewhere, whichever period is less.
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(iv)
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“Good
Reason” exists if, without Executive’s express written
consent, any of the following occurs:
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(1)
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a failure to
elect or reelect or to appoint or reappoint Executive as President
and Chief Executive Officer of the Bank;
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(2)
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a material
change in Executive’s position to become one of lesser
responsibility, importance, or scope from the position and
attributes thereof described in Section 1 above;
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(3)
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a liquidation
or dissolution of the Bank other than liquidations or dissolutions
that are caused by reorganizations that do not affect the status of
Executive;
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(4)
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a material
reduction in Executive’s Base Salary and benefits (other than
a reduction authorized under Section 4(a) or
Section 6(f)(v), hereof);
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(5)
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a relocation of
Executive’s principal place of employment by more than 30
miles from
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