EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This Employment
Agreement (the
"Agreement")
is entered into as
of
March 22, 2004, by and between Sutter Holding Company, Inc., a Delaware
corporation ("Employer"), and R. Michael
Collins ("Employee").
In consideration of the mutual covenants
contained herein, Employer and Employee
hereby agree as follows:
1. Engagement. Employer hereby engages Employee to perform services
and
duties for Employer in the capacities of
President. Employee accepts such
engagement and hereby agrees to perform the
duties, undertake the
responsibilities and exercise the authority
customarily performed, undertaken
and exercised by persons situated in a
similar executive capacity. Excluding
discretionary periods of vacation and sick
leave to which the Employee is
entitled, the Employee agrees to devote
reasonable attention and time to the
business and affairs of Employer to the
extent necessary to discharge the
responsibilities assigned to the Employee
hereunder. Employer acknowledges that
Employee is engaged in several business
activities and ventures, and that
performance of Employee's duties under this
Agreement is not intended to be a
full-time commitment.
2. Term. The term of employment under this Agreement shall be for
the
period commencing on the date hereof, and
ending March 31, 2007; provided,
however, that the term of this Agreement
shall be automatically extended for one
(1) year on each anniversary of this
Agreement unless either Employer or
Employee shall have given written notice to
the other at least ninety (90) days
prior thereto that the term of this
Agreement shall not be so extended.
3. Compensation.
(A) Salary. In consideration of the services to be rendered by
Employee, Employer shall pay Employee an
annual base salary of five hundred
thousand dollars (US $500,000), not to
exceed the lesser of (i) 1.0% annually of
Employer's reported gross asset value, or
(ii) 5.0% annually of Employer's
reported total shareholder's equity,
payable monthly based upon the ending
balance sheet for the previous quarter. For
purposes of clarity, the annual
salary of $500,000 shall be hereinafter
referred to as "Base Salary", and the
actual annual salary paid after adjusting
for either (i) or (ii) above, as the
case may be, shall be hereinafter referred
to as "Effective Salary." Employer
may in its discretion from time to time
increase, but may not decrease,
Employee's Base Salary. Both Employer and
Employee note that it is possible for
the Employee's Effective Salary to
decrease, without any action on the part of
the Employer's Board of Directors, since it
is calculated based on Employer's
quarterly reported gross asset value and
shareholder's equity, which are subject
to periodic fluctuation. Without any
necessary action to be taken by the
Employer's Board of Directors, Base Salary
shall be adjusted annually based on
changes in the U.S. Consumer Price Index
("CPI") with a starting point of
January 1, 2003.
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(B) Other Incentive Compensation. Employee will be eligible to
participate in any stock option or grant
plan established by the Employer, and
shall be granted stock options annually or
from time to time there under as
approved by the Employer's Board of
Directors. In the event that the Company
acquires, merges with, or enters into a
joint venture with Bristol Home Mortgage
Lending, LLC, Employer shall upon the
closing of such transaction grant to
Employee the right to purchase all or any
part of twenty thousand (20,000)
shares of the Employer's common stock at an
exercise price equal to a fifty
percent (50%) premium to the price of the
Company's stock either (i) 20 business
days, or (ii) 1 business day prior to the
public announcement of such
transaction, whichever is lower. In the
event that Employee receives fee income
from Michael D. London or any business
affiliated with Mr. London, Employee
agrees to invest in Employer: (i) 20% of
the after-tax proceeds of such fee up
to a total fee of $350,000; (ii) 80% of the
after-tax proceeds of such fee in
excess of $350,000 up to a total fee of
$700,000; and (iii) 50% of the after-tax
proceeds of such fee in excess of $700,000.
The investment described in the
immediately preceding paragraph shall be in
common stock of Employer at a price
equal to the price of the Company's stock 1
business day prior to the date of
such investment. In the event that this
Agreement is not extended because
Employer has given written notice thereof
pursuant to the proviso set forth in
Section 2 above, notwithstanding any
vesting provisions, all stock options
granted to Employee shall immediately vest
upon the receipt of such written
notice.
(C) Change of Control. For purposes of this Agreement, a
"Change
of Control", is defined as either (i)
Employee's loss of voting control of
Employer, which is defined as any point in
time when Employee's control of
voting stock, combined with the control of
voting stock of Employer's other
officers and directors currently employed,
is less than that of any other
entity's (i.e. institution, trust or
individual) voting control; or (ii)
Employee's loss of or material reduction in
compensation, or managerial scope
and control of Employer. In the event of a
Change of
