EXHIBIT 10.7
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AGREEMENT
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THIS AGREEMENT
is made effective as of April 18, 2003, by and between
FIRSTBANK NORTHWEST (the "BANK"); FIRSTBANK
NW CORP. ("COMPANY"), a Washington
State corporation; and Donn L. Durgan
("EXECUTIVE").
WHEREAS, the
BANK recognizes the substantial contribution EXECUTIVE has
made to the BANK and wishes to protect his
position as Chief Lending Officer
therewith for the period provided in this
Agreement in the event of a Change in
Control (as defined herein); and
NOW, THEREFORE,
in consideration of the foregoing and upon the other terms
and conditions hereinafter provided, the
parties hereto agree as follows:
1. Term Of Agreement
The term of this
Agreement shall be deemed to have commenced as of the date
first above written and shall continue for
a period of thirty-six (36) full
calendar months thereafter. Commencing on
the first anniversary date of this
Agreement and continuing at each
anniversary date thereafter, the Board of
Directors of the BANK ("Board") may extend
the Agreement for an additional year.
The Chief Financial Officer of the Bank
will conduct a performance evaluation of
EXECUTIVE for purposes of determining
whether to extend the Agreement, and the
results thereof will be reported to the
Board.
2. Payments To EXECUTIVE Upon
Change In Control.
(a) Upon the
occurrence of a Change in Control (as herein defined) followed
within twelve (12) months of the effective
date of the Change in Control by the
voluntary or involuntary termination of
EXECUTIVE's employment, other than for
Cause, as defined in Section 2(c) hereof,
the provisions of Section 3 shall
apply. For purposes of this Agreement,
"voluntary termination" shall be limited
to the circumstances in which EXECUTIVE
elects to voluntarily terminate his
employment within twelve (12) months of the
effective date of a Change in
Control following any material demotion,
loss of title, office or significant
authority, material reduction in his annual
compensation or benefits (other than
a reduction affecting the Bank's personnel
generally), or the relocation of his
principal place of employment by more than
35 miles from its location
immediately prior to the Change in
Control.
(b) A "Change in
Control" of the COMPANY or the BANK shall be deemed to
occur if and when (a) an offeror other than
the COMPANY purchases shares of the
common stock of the COMPANY or the BANK
pursuant to a tender or exchange offer
for 25% or more of such shares, (b) any
person (as such term is used in Sections
13(d) and 14(d)(2) of the Securities
Exchange Act of 1934) is or becomes the
beneficial owner, directly or indirectly,
of securities of the COMPANY or the
BANK representing twenty-five percent (25%)
or more of the combined voting power
of the COMPANY's or the BANK's then
outstanding securities, (c) the membership
of the board of directors of the COMPANY or
the BANK changes as the result of a
contested election, such that individuals
who were directors at the beginning of
any twenty-four (24) month period (whether
commencing before or after the date
of adoption of this Agreement) do not
constitute a majority of the Board at the
end of such period, or (d) shareholders of
the COMPANY or the BANK approve a
merger, consolidation, sale or disposition
of all or substantially all of the
COMPANY's or the BANK's assets, or a plan
of partial or complete liquidation.
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(c) EXECUTIVE
shall not have the right to receive termination benefits
pursuant to Section 3 hereof upon
Termination for Cause. The term "Termination
for Cause" shall mean termination because
of EXECUTIVE's intentional failure to
perform stated duties, personal dishonesty,
incompetence, willful misconduct,
any breach of fiduciary duty involving
personal profit, willful violation of any
law, rule, regulation (other than traffic
violations or similar offenses) or
final cease and desist order, or any
material breach of any material provision
of this Agreement. In determining
incompetence, the acts or omissions shall be
measured against standards generally
prevailing in the savings institution
industry. Notwithstanding the foregoing,
EXECUTIVE shall not be deemed to have
been terminated for Cause unless and until
there shall have been delivered to
him a copy of a resolution duly adopted by
the affirmative vote of not less than
three-fourths of the members of the Board
at a meeting of the Board called and
held for that purpose (after reasonable
notice to EXECUTIVE and an opportunity
for him, together with counsel, to be heard
before the Board), finding that in
the good faith opinion of the Board,
EXECUTIVE was guilty of conduct justifying
Termination for Cause and specifying the
particulars thereof in detail.
EXECUTIVE shall not have the right to
receive compensation or other benefits for
any period after Termination for Cause.
3. Termination
(a) Upon the
occurrence of a Change in Control, followed within twelve (12)
months of the effective date of a Change in
Control by the voluntary or
involuntary termination of EXECUTIVE's
employment other than Termination for
Cause, the BANK shall, in addition to the
BANK's other obligations to the
EXECUTIVE under any other plan or
agreement, pay to the EXECUTIVE or, in the
event of hi
