EXHIBIT 10.4
BANK OF THE SAN JUANS
EMPLOYMENT AGREEMENT
XXXX XXXXXX
THIS EMPLOYMENT AGREEMENT (this "Agreement"), signed as of August 19, 2008,
between BANK OF THE SAN JUANS BANCORPORATION ("SJ Bancorp"), BANK OF THE SAN
JUANS (the "Bank") and Xxxx Xxxxxx. ("Executive") and ratified by GLACIER
BANCORP, INC. ("GBCI"), takes effect on the effective date of the pending Merger
(the "Effective Date") referenced below.
RECITALS
A. SJ Bancorp has entered into a Plan and Agreement Merger (the "Merger
Agreement") with GBCI, pursuant to which SJ Bancorp will merge with and
into GBCI, and the Bank will become a wholly owned subsidiary of GBCI (the
"Merger").
B. Executive presently serves as Chief Operating Officer and Chief Financial
Officer of SJ Bancorp and the Bank and will continue to do so until the
Effective Date.
C. GBCI and the Bank desire Executive to be employed by the Bank from and
after the Effective Date, under the terms and conditions of this Agreement,
and Executive desires to be employed by the Bank from and after the
Effective Date, under the terms and conditions of this Agreement.
AGREEMENT
In consideration of the promises set forth in this Agreement, the parties
agree as follows.
1. EMPLOYMENT; TITLE. The Bank agrees to employ Executive, and Executive
accepts employment by the Bank on the terms and conditions set forth in
this Agreement. Executive's title will be Chief Operating Officer and Chief
Financial Officer of the Bank.
2. EFFECTIVE DATE AND TERM.
a. Term. The term of this Agreement ("Term") is three years, beginning on
the Effective Date.
b. Abandonment or Termination of the Merger. This Agreement is void if
the Merger Agreement is terminated for any reason.
3. DUTIES. The Bank will employ Executive as its Chief Operating Officer and
Chief Financial Officer. Executive will faithfully and diligently perform
the duties assigned to him, which duties will be consistent with his title
and position. Executive will report directly to the Bank's President and
Chief Executive Officer. The Bank's board of directors may, from time to
time, modify Executive's performance responsibilities to accommodate
management objectives of the Bank or of GBCI. Executive will assume any
additional positions, duties, and responsibilities as may reasonably be
requested of him with or without additional compensation, as appropriate
and consistent with his title and position.
4. EXTENT OF SERVICES. Executive will devote all of his working time,
attention and skill to the duties and responsibilities referenced in
Section 3. To the extent that such activities do not interfere with his
duties under Section 3, Executive may participate in other businesses as a
passive investor, but (a) Executive may not actively participate in the
operation or management of those businesses, and (b) Executive may not,
without the Bank's prior written consent, make or maintain any investment
in a business with which the Bank and/or GBCI has an existing competitive
or commercial relationship.
5. SALARY. Executive will receive an annualized salary of $113,300.
Executive's salary will be paid in accordance with the Bank's regular
payroll schedule. Subsequent salary increases are subject to the Bank's
annual review of Executive's compensation and performance.
6. INCENTIVE COMPENSATION. Executive will be eligible to receive bonuses as
determined by the Bank's board of directors. In making bonus
determinations, factors such as Executive's performance of his duties and
the safety, soundness and profitability of Employer will be considered.
Executive's bonus will reflect Executive's contribution to the performance
of the Bank during the year.
7. VACATION AND BENEFITS.
a. Vacation and Holidays. Executive will receive four weeks of paid
vacation each year. Executive's ability to carry over or accumulate
vacation will be governed by the Bank's and/or GBCI's applicable
policies.
b. Benefits. Executive will be entitled to participate in any group life
insurance, disability, health and accident insurance plans, profit
sharing plan and in other employee fringe benefit programs the Bank or
GBCI may have in effect from time to time for its similarly situated
employees, in accordance with and subject to any policies adopted by
the Bank's or GBCI's board of directors with respect to the plans or
programs, including without limitation, any incentive or employee
stock option plan, deferred compensation plan and 401(k) plan. Neither
the Bank nor GBCI through this Agreement obligates itself to make any
particular benefits available to its employees.
c. Business Expenses. The Bank will reimburse Executive for ordinary and
necessary expenses which are consistent with past practice at the Bank
(including,
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without limitation, travel, entertainment, and similar expenses) and
which are incurred in performing and promoting the Bank's business.
Executive will present from time to time itemized accounts of these
expenses, subject to any limits of Bank policy or the rules and
regulations of the Internal Revenue Service.
8. TERMINATION OF EMPLOYMENT.
a. Termination By Bank for Cause. If the Bank terminates Executive's
employment for Cause (defined below) or Executive terminates his
employment without Good Reason (defined below) before this Agreement
terminates, the Bank will pay Executive the salary earned and expenses
reimbursable under this Agreement incurred through the date of his
termination. Executive will have no right to receive compensation or
other benefits for any period after termination under this Section
8(a).
b. Other Termination By Bank. If the Bank terminates Executive's
employment without Cause before this Agreement terminates, or
Executive terminates his employment for Good Reason, the Bank will pay
Executive a lump sum payment equal to one times Executive's annual
base salary at the time of termination.
c. Death or Disability. This Agreement terminates (1) if Executive dies
or (2) if Executive is unable to perform his duties and obligations
under this Agreement for a period of 90 consecutive days as a result
of a physical or mental disability arising at any time during the term
of this Agreement, unless with reasonable accommodation Executive
could continue to perform his duties under this Agreement and making
these accommodations would not pose an undue hardship on the Bank. If
termination occurs under this Section 8(c), Executive or his estate
will be entitled to receive all compensation and benefits earned and
expenses reimbursable through the date Executive's employment
terminated.
d. Return of Bank Property. If and when Executive ceases, for any reason,
to be employed by the Bank, Executive must return to the Bank all
keys, pass cards, identification cards and any other property of the
Bank or GBCI. At the same time, Executive also must return to the Bank
all originals and copies (whether in hard copy, electronic or other
form) of any documents, drawings, notes, memoranda, designs, devices,
diskettes, tapes, manuals, and specifications which constitute
proprietary information or material of the Bank or GBCI. The
obligations in this paragraph include the return of documents and
other materials that may be in his desk at work, in his car, in place
of residence, or in any other location under his control.
e. Cause. "Cause" means any one or more of the following:
(1) Willful misfeasance or gross negligence in the performance of
Executive's duties;
(2) Conviction of a crime in connection with his duties; or
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(3) Conduct demonstrably and significantly harmful to the Bank, as
reasonably determined on the advice of legal counsel by the
Bank's board of directors.
f. Good Reason. "Good Reason" means only any one or more of the
following:
(1) Reduction of Executive's salary or reduction or elimination of
any compensation or benefit plan benefiting Executive, unless the
reduction or elimination is generally applicable to substantially
all Bank employees (or employees of a successor or controlling
entity of the Bank) formerly benefited;
(2) The assignment to Executive without his consent of any authority
or duties materially inconsistent with Executive's position as of
the date of this Agreement;
(3) A relocation or transfer of Executive's principal place of
employment that would require Executive to commute on a regular
basis more than thirty (30) miles each way from the Bank's
present main office location.
9. CONFIDENTIALITY. Executive will not, after the date this Agreement was
signed, including during and after its Term, use for his own purposes or
disclose to any other person or entity any confidential business
information concerning SJ Bancorp, the Bank or GBCI or their business
operations, unless (1) the Bank or GBCI consents to the use or disclosure
of their respective confidential information; (2) the use or disclosure is
consistent with Executive's duties under this Agreement; (3) disclosure is
required by law or court order; or (4) the information is made or otherwise
becomes public. For purposes of this Agreement, confidential business
information includes, without limitation, various confidential information
concerning all aspects of current and future operations, nonpublic
information on investment management practices, marketing plans, pricing
structure and technology of either the Bank or GBCI. Executive will also
treat the terms of this Agreement as confidential business information.
10. RESTRICTIVE COVENANTS.
a. Competitive Activities. During the period of his employment and, if
Executive's employment with the Bank terminates pursuant to Section
8(a) or Section 8(b) of this Agreement, then for one year after
Executive's employment with the Bank has ended, Executive will not,
directly or indirectly, as a founder, shareholder, director, officer,
employee, partner, agent, consultant, lessor, creditor or otherwise,
provide management, supervisory or other similar services to any
person or entity engaged in any business within La Plata County,
Colorado or Xxxxxxxxx County, Colorado, that is competitive with the
business of the Bank or GBCI as conducted during the term of this
Agreement or as conducted as of the date of termination of employment,
including any preliminary steps associated with the formation of a new
financial institution.
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b. Non-Interference. During the period of his employment and, if
Executive's employment with the Bank terminates pursuant to Section
8(a) or Section 8(b) of this Agreement, then for one year after
Executive's employment with the Bank has ended, Executive will not,
directly or indirectly, persuade or entice, or attempt to persuade or
entice, (i) any employee of the Bank or GBCI to terminate his/her
employment with the Bank or GBCI, or (ii) any person or entity to
terminate, cancel, rescind or revoke its business or contractual
relationships with the Bank or GBCI.
11. ENFORCEMENT.
a. The Bank and Executive stipulate that, in light of all of the facts
and circumstances of the relationship between Executive and the Bank,
the agreements referred to in Sections 9 and 10 (including without
limitation their scope, duration and geographic extent) are fair and
reasonably necessary for the protection of the Bank's and GBCI's
confidential information, goodwill and other protectable interests. If
a court of competent jurisdiction should decline to enforce any of
those covenants and agreements, Executive and the Bank request the
court to reform these provisions to restrict Executive's use of
confidential information and Executive's ability to compete with the
Bank and GBCI to the maximum extent, in time, scope of activities, and
geography, the court finds enforceable.
b. Executive acknowledges the Bank and GBCI will suffer immediate and
irreparable harm that will not be compensable by damages alone if
Executive repudiates or breaches any of the provisions of Sections 9
or 10 or threatens or attempts to do so. For this reason, under these
circumstances, the Bank, in addition to and without limitation of any
other rights, remedies or damages available to it at law or in equity,
will be entitled to obtain temporary, preliminary and permanent
injunctions in order to prevent or restrain the breach, and the Bank
will not be required to post a bond as a condition for the granting of
this relief.
12. COVENANTS. Executive specifically acknowledges the receipt of adequate
consideration for the covenants contained in Sections 9 and 10 and that the
Bank is entitled to require him to comply with these Sections. These
Sections will survive termination of this Agreement. Executive represents
that if his employment is terminated, whether voluntarily or involuntarily,
Executive has experience and capabilities sufficient to enable Executive to
obtain employment in areas which do not violate this Agreement and that the
Bank's enforcement of a remedy by way of injunction will not prevent
Executive from earning a livelihood.
13. ARBITRATION.
a. Arbitration. At either party's request, the parties must submit any
dispute, controversy or claim arising out of or in connection with, or
relating to, this Agreement or any breach or alleged breach of this
Agreement, to arbitration under the American Arbitration Association's
rules then in effect (or under any other
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form of arbitration mutually acceptable to the parties). A single
arbitrator agreed on by the parties will conduct the arbitration. If
the parties cannot agree on a single arbitrator, each party must
select one arbitrator and those two arbitrators will select a third
arbitrator. This third arbitrator will hear the dispute. The
arbitrator's decision is final (except as otherwise specifically
provided by law) and binds the parties, and either party may request
any court having jurisdiction to enter a judgment and to enforce the
arbitrator's decision. The arbitrator will provide the parties with a
written decision naming the substantially prevailing party in the
action. This prevailing party is entitled to reimbursement from the
other party for its costs and expenses, including reasonable
attorneys' fees.
b. Governing Law. All proceedings will be held at a place designated by
the arbitrator in Denver County, Colorado. The arbitrator, in
rendering a decision as to any state law claims, will apply Colorado
law.
c. Exception to Arbitration. Notwithstanding the above, if Executive
violates Section 9 or 10, the Bank will have the right to initiate the
court proceedings described in Section 11(b), in lieu of an
arbitration proceeding under this Section 13.
14. MISCELLANEOUS PROVISIONS.
a. Entire Agreement. This Agreement constitutes the entire understanding
and agreement between the parties concerning its subject matter and
supersedes all prior agreements, correspondence, representations, or
understandings between the parties relating to its subject matter.
b. Binding Effect. This Agreement will bind and inure to the benefit of
the Bank's, GBCI's and Executive's heirs, legal representatives,
successors and assigns.
c. Litigation Expenses. If either party successfully seeks to enforce any
provision of this Agreement or to collect any amount claimed to be due
under it, this party will be entitled to reimbursement from the other
party for any and all of its out-of-pocket expenses and costs
including, without limitation, reasonable attorneys' fees and costs
incurred in connection with the enforcement or collection.
d. Waiver. Any waiver by a party of its rights under this Agreement must
be written and signed by the party waiving its rights. A party's
waiver of the other party's breach of any provision of this Agreement
will not operate as a waiver of any other breach by the breaching
party.
e. Assignment. The services to be rendered by Executive under this
Agreement are unique and personal. Accordingly, Executive may not
assign any of his rights or duties under this Agreement.
f. Amendment. This Agreement may be modified only through a written
instrument signed by both parties.
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g. Severability. The provisions of this Agreement are severable. The
invalidity of any provision will not affect the validity of other
provisions of this Agreement.
h. Governing Law and Venue. This Agreement will be governed by and
construed in accordance with Colorado law, except to the extent that
certain regulatory matters may be governed by federal law. The parties
must bring any legal proceeding arising out of this Agreement in
Denver County, Colorado.
i. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original, but all of
which taken together will constitute one and the same document.
j. Counsel Review. Executive acknowledges that he has had the opportunity
to consult with independent counsel with respect to the negotiation,
preparation, and execution of this Agreement.
k. IRC Section 409A. The provisions of this Agreement are intended to
comply with Section 409A of the U.S. Internal Code of 1986, as
amended, U.S. Treasury regulations issued thereunder, and related U.S.
Internal Revenue Service guidance ("409A Rules"). Such provisions will
be interpreted and applied in a manner consistent with the 409A Rules
so that payments and benefits provided to Executive hereunder will
not, to the greatest extent possible, be subject to taxation under
such Section 409A. Notwithstanding any contrary provisions hereof,
this Agreement may be amended if and to the extent GBCI and/or the
Bank determines that such amendment is necessary to comply with the
409A Rules.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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This Employment Agreement is executed as of August 19, 2008.
BANK OF THE SAN JUANS
BANCORPORATION:
By /s/ Xxxxxx X. Xxxxx, Xx.
------------------------------------
Its:
BANK OF THE SAN JUANS:
By /s/ Xxxxxx X. Xxxxx, Xx.
------------------------------------
Its:
EXECUTIVE:
/s/ Xxxx Xxxxxx
----------------------------------------
Xxxx Xxxxxx
Ratified as of August 19, 2008:
GLACIER BANCORP, INC.
By /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxxx
Its: President & Chief Executive Officer
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