Exhibit 10.2
CONSULTING AND
NON-SOLICITATION AGREEMENT
THIS CONSULTING AND NON-SOLICITATION
AGREEMENT (the “Agreement”) is made and entered into as
of this 22nd day of December, 2005, by and between PLACER SIERRA
BANK, a California corporation (“Bank”) and ROBERT H.
MUTTERA (“Consultant”) (collectively, the
“Parties”).
RECITALS
A. The Bank entered into an
employment agreement with Consultant effective as of
January 1, 2003 and amended as of October 28, 2003 (the
“Employment Agreement”) to act as Executive
Vice-President and Chief Credit Officer of the Bank.
B. The Employment Agreement will
expire by its terms as of December 31, 2005.
C. The Bank desires to obtain the
services of Consultant upon expiration of the term of the
Employment Agreement and Consultant desires to provide personal
services to the Bank;
D. The Bank desires to retain
Consultant to serve on an independent contractor basis;
and
E. Consultant will perform such
consulting services and not solicit any employee of the Bank or
Placer Sierra Bancshares to terminate such person’s
employment relationship with the Bank or Placer Sierra Bancshares,
as provided herein, provided the Bank agrees to pay Consultant fees
in accordance with the terms and conditions hereinafter set
forth.
In consideration of the services to
be performed in the future as well as the mutual promises and
covenants herein contained, it is agreed as follows:
1. Consultant Services;
Bank’s Responsibilities .
(a) Consultant’s
Services . Upon expiration of the Employment Agreement,
Consultant agrees to provide consulting services as requested by
the Bank including, but not limited to, in the area of market
analysis (the “Consulting Services”) for the Term (as
defined in Section 2 below). In performing the Consulting
Services, the Bank shall not obligate Consultant to devote more
than an average of four (4) hours per week in providing the
Consulting Services. At the request of the Bank, the Consulting
Services may be provided by telephone or at a site or sites other
than at the offices of the Bank. Consultant and Bank acknowledge
that this Agreement is a non-exclusive agreement, and Consultant
may provide services as an employee or independent contractor to
other financial institutions during the term of this
Agreement.
(b) Bank’s
Responsibilities . The Bank shall cooperate with Consultant and
provide all information and direction necessary to accomplish the
purposes of this Agreement.
2. Term . Subject to the
provisions for termination provided in paragraph 6, the term
of this Agreement shall begin as of January 1, 2006 (the
“Effective Date”) and shall end upon the expiration of
twelve (12) months after the Effective Date (the
“Term”) provided, however, that the obligations of the
Bank under this Agreement shall be conditioned upon the execution
by
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Consultant and delivery to the Bank of the
Release Agreement in the form attached hereto as Exhibit A not less
than twenty-eight (28) days prior to the Effective
Date.
3. Fees . The Bank agree to
pay to Consultant, and Consultant agrees to accept as full payment
for the performance of services hereunder and for Consultant
complying with the non-solicitation provision in Section 8
below, a monthly fee in the amount of $18,083.00, payable within
five (5) business days of the month immediately following each
such month during which the Consulting Services are rendered and
Consultant complies with Section 8. In addition, the Bank
shall pay Consultant a one-time payment of $86,800.00 as of
January 15, 2006. The Bank shall pay such fees and one-time
payment without withholding any Federal or state or local
taxes.
4. Expenses . Consultant
shall not be reimbursed for the expenses incurred or paid by him in
the provision of Consulting Services under this
Agreement.
5. Independent Contractor .
The Bank and the Consultant acknowledge that during the Term
Consultant will not be an employee of the Bank and will be working
as an independent contractor for the Bank. Accordingly, Consultant
shall be responsible for payment of all taxes including federal,
state and local taxes arising out of Consultant’s activities
in accordance with this Agreement, including by way of illustration
but not limitation, federal and State income tax, Social Security
tax, Unemployment Insurance taxes, and any other taxes or business
license fees as required. Consultant shall not earn any additional
medical, dental, life insurance, retirement benefits, paid
vacations or sick leave or any other employee benefits as a result
of his providing Consulting Services to the Bank.
6. Termination of Agreement .
If this Agreement is terminated pursuant to this paragraph 6, the
Bank shall have no further liability to Consultant other than for
fees or expenses incurred as of the date of termination but not yet
paid, except that the one-time payment described in Paragraph 3
above shall be paid regardless of Consultant’s death or
disability.
(a) Termination by the Bank for
Cause . This Agreement and Consultant’s services
hereunder may be terminated for cause by the Bank upon written
notice to Consultant, and Consultant shall not be entitled to
receive compensation or other benefits for any period after
termination for cause. “For cause” pursuant to this
Agreement shall include, but not be limited to: (i) any act of
material dishonesty; (ii) any material breach of this
Agreement or any breach of a fiduciary duty (involving personal
profit); (iii) any habitual neglect of, or habitual negligence
in carrying out, those duties contemplated under this Agreement;
(iv) any willful violation of any law, rule or regulation,
which, by virtue of bank regulatory restrictions imposed as a
result thereof, would have a material adverse effect on the
business or financial prospects of the Bank; (v) any
conviction of any felony or misdemeanor which may be reasonably
interpreted to be harmful to the Bank’s reputation ;
(vii) the inducement of any agent or employee to break any
contract or terminate the agency or employment relationship with
the Bank or its affiliates; or (viii) the requirement to
comply with any final cease-and-desist order or written agreement
with any applicable state or federal bank regulatory authority
which requests or orders Consultant’s dismissal or limits
Consultant’s duties. Termination for cause by the Bank shall
not constitute a
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waiver of any remedies which may
otherwise be available to the Bank under law, equity, or this
Agreement.
(b) Termination by Death or
Disability . The Bank may terminate this Agreement by written
notice to Consultant if, during the term of this Agreement,
Consultant shall become incapable of fulfilling obligations
hereunder because of death, injury or physical or mental
disability. Termination for reason of disability shall be effective
immediately as of the date of said notice.
(c) Termination for Solicitation
of Bank or Placer Sierra Bancshares Employees . The Bank may
terminate this agreement by written notice to Consultant if, during
the term of this Agreement, Consultant becomes employed by any
other corporation, association, partnership, limited liability
company, trust, joint venture or other entity (the
“Subsequent Employer”) and the Subsequent Employer,
either alone or in conjunction with Consultant, solicits, aids in
the solicitation of, induces or attempts to induce any person who
is then an employee of the Bank or of Placer Sierra Bancshares to
terminate such person’s employment relationship with the Bank
or Placer Sierra Bancshares.
7. Indemnification . To the
extent permitted by law and the Bank’s Articles of
Incorporation and by-laws, the Bank shall indemnify, defend and
hold Consultant harmless against any and all claims as may be
asserted by any third party against Consultant based on the
performance of Consultant’s services under the terms of this
Agreement.
8. Non-Solicitation .
Consultant shall not prior to January 1, 2007, directly or
indirectly, without the prior written consent of the Bank, either
as an employee, employer, consultant, agent, principal, partner,
shareholder, corporate officer, director, or in any other
individual or representative capacity, solicit, aid in the
solicitation of, induce or attempt to induce any person who is an
employee of the Bank or of Placer Sierra Bancshares to terminate
such person’s employment relationship with the Bank or Placer
Sierra Bancshares. Consultant hereby acknowledges the particular
value to the Bank
