Exhibit (10)K
CONSULTING AND NONCOMPETITION AGREEMENT
THIS CONSULTING AND NONCOMPETITION
AGREEMENT (the "Agreement") is executed by
and between FNB Corporation, a Virginia
corporation and bank holding
Corporation headquartered in
Christiansburg, Virginia (the "Corporation"), and
R. Bruce Munro, who resides at 4101 Eagle
Circle, Roanoke, Virginia 24018 (the
"Consultant") and is to be effective as
hereinafter set forth.
The parties
agree to the following:
WITNESSETH:
WHEREAS, the Consultant has for many years
served as a full-time Executive
Officer of FNB Corporation, most recently
holding the position of Executive
Vice-President of FNB Corporation; and
WHEREAS, with the consent of FNB
Corporation, Consultant agreed to serve as
President/CEO and Director of First
National Bank for an interim period ending
upon the selection and qualification of his
successor; and
WHEREAS, the Consultant has announced his
retirement from the Corporation
effective September 30, 2005 to coincide
with the expiration of his employment
with First National Bank; and
WHEREAS, the Corporation wishes to hire the
Consultant as an independent
contractor to provide the consulting
services hereinafter set forth and to
perform other special projects for the
benefit of the Corporation, all on an
as-needed basis, starting on the day
following his retirement from First
National Bank; and
NOW, THEREFORE, in consideration of the
foregoing premises, the mutual
promises set forth in this Agreement, and
other good and valuable
consideration, the Consultant and
Corporation agree as follows:
1. Engagement and
Retention. The
Corporation hereby engages and retains
the
services of the Consultant as an independent contractor to
provide
consulting assistance on the duties outlined in this Agreement.
The
Consultant accepts his engagement and retention on these terms.
2. Term.
The term of this
Agreement shall begin the day following
Consultants retirement from First National Bank and shall continue
for
a
period of five (5) years thereafter unless sooner terminated
under
the
provisions of Section 13 hereof.
3. Duties of the
Consultant. The
Consultant shall, upon the request of
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the
Corporation's Chief Executive Officer or his designee, perform
the
following duties:
(a)
participate in
any due diligence analysis required in connection
with a proposed merger, acquisition, branch purchase or sale,
or
similar corporate transaction involving the Corporation;
(b)
counsel the
Corporation on strategic planning matters;
(c)
assist the
Corporation in promoting the stock of the Corporation
with market makers, institutional investors, and other
interested
parties;
(d)
provide any
other aid for which the Consultant may be reasonably
expected to have the requisite knowledge and experience to
assist
the Corporation; and
(e)
help develop and
retain business and promote the Corporation and
its affiliates; and
(f)
perform such
other assignments and projects as may, from time to
time, be assigned to him by the Chief Executive Officer or his
designee.
(g)
The parties
agree that services to be rendered hereunder are to
be as needed, and project-oriented, and provided on a schedule
that
is mutually agreeable.
As a general rule, requests for
services shall not involve extended periods of time. The
Corporation shall not make unreasonable demands upon the
Consultant's time and the Consultant shall not unreasonably
limit
his availability to perform the services requested by the
Corporation.
In the event services are requested which would involve a long-
term or extended basis, the Consultant will be cooperative but
shall provide such consulting services only on such terms as
the
parties may agree upon at the time before services are
provided,
which shall include the Corporation paying additional
compensation for such extended services.
4. Compensation.
For the Corporation's
access to the Consultant's time,
talent, and services the Corporation shall pay the Consultant
compensation as follows:
The Corporation shall pay the Consultant an
annual retainer of Six Thousand
Dollars ($6, 000). The retainer shall accrue and be
payable monthly in equal
installments with the first installment
being due and payable on the last day
of the month immediately following his
retirement and on the last day of each
month thereafter for a period ending five
(5) years thereafter unless the
contract is otherwise terminated as set
forth in Paragraph 13, hereof. The
First monthly installment of Five Hundred
Dollars shall be due and payable on
the 31st day of October, 2005 and a like
sum on the last day of each month
thereafter for a period ending on September
30, 2010.
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Should a Change in control occur prior to
Consultants retirement from First
National Bank then the Consultant shall be
entitled to retain and exercise all
benefits set forth in a certain Change of
control agreement heretofore entered
into between First National Bank, FNB
Corporation and R. Bruce Munro dated
August 1997. The compensation provided for
therein shall be substituted for
the compensation to which the Consultant
would otherwise be entitled to in
year one of this agreement.
(a) For each year the Agreement
is in effect, the Corporation shall
issue an IRS Form 1099 to the Consultant for all compensation
paid
to him under this Agreement. The Consultant shall be solely
responsible for the payment of any and all taxes, which may be
due
on such sums.
(b) For the Consultant's
agreement to refrain from assisting any
competitor of the Corporation as set forth in Paragraph 10
hereof
the Corporation shall pay the Consultant a retainer of Eighteen
Thousand ($18,000) a year. The forgoing sum shall be
payable
monthly in equal monthly installments with the first installment
of
One Thousand Five Hundred Dollars ($1500.00) being due and
payable
on the 31st day of October, 2005 and a like such sum on the
last
day of the month thereafter for a period years unless otherwise
terminated as set forth in Paragraph 13, hereof.
(c) It is expressly understood
and agreed between the parties hereto
that should the consultant's death occur during the term of
this
agreement then the consultant's estate shall be entitled to
receive
payment for the entire month in which the death occurs but all
other benefits shall cease and any and all obligations of FNB
Corporation and/or its subsidiaries under this agreement shall
terminate.
5. Relationship of
the Parties. Nothing
contained in this Agreement shall
be
construed to constitute the Consultant as an employee of the
Corporation or any of its subsidiaries. Furthermore, neither party
shall have the authority to bind each other in any respect beyond
the
express provisions of this Agreement. The Consultant shall retain
the
exclusive authority to manage the manner and means of his
performance
hereunder. During any period when the
Corporation has not requested
the
Consultant to perform his duties under this Agreement, he shall
be
free
to render his services, in such manner and to such persons,
firms
and
corporation as he deems advisable, subject to the
confidentiality
and
noncompetition provisions hereof.
6. Corporation
Property. Except as
required to perform his duties under
this
Agreement or as otherwise required by law, Consultant
understands
and
agrees that he will not copy, duplicate, use, access, or
disseminate to third parties any Corporation property. Consultant also
agrees to maintain and safeguard all Corporation property in
his
possession and to return to the Corporation all Corporation
property,
including copies of the same, in his possession, upon request by
the
Corporation. The term
"property" herein includes, but is not limited
to,
documents, reports, files, memoranda and records, door and file
keys, computer access codes, software, and all physical and
personal
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property, whether of the Corporation or a customer of the
Corporation,
which Consultant has in his possession, or received, or helped
to
prepare in connection with his previous employment with the
Corporation
or
the provision of services under this Agreement.
7. Safeguarding
Confidential Information. The Corporation may provide
access to the Consultant to confidential and proprietary
information
(hereinafter "confidential information") in order that he may carry
out
his
duties hereunder. The
Consultant may also have had access to
confidential information as a result of his previous employment
with
the
Corporation. The
Consultant understands and agrees that the
following obligations apply to any confidential information of
the
Corporation which is in possession of the Consultant:
(a)
that any
confidential information is the exclusive property of
the Corporation and the Consultant acknowledges that he has no
ownership interest or right of any kind to said information;
(b)
except as
otherwise required by law, Consultant agrees that he
will
not, either directly or indirectly, use, access, disclose,
or divulge to any unauthorized party (as defined below), for
his
own benefit or to the detriment of the Corporation, any
confidential information; and
(c)
if Consultant
believes th
