EXHIBIT NO. 10.4
EXHIBIT 10.4
AGREEMENT MADE THIS 20th DAY OF NOVEMBER, 1990, by and between
NORTHWEST SAVINGS BANK, PaSA, a Pennsylvania Corporation, hereinafter referred
to as "Employer", and XXXX X. XXXXX, Warren, Pennsylvania, hereinafter referred
to as "Employee".
WITNESSETH:
WHEREAS, Employee is President and Chief Executive Officer of
Northwest Savings Bank, PaSA, and has developed an intimate and thorough
knowledge of Employer's methods and operations; and
WHEREAS, the retention of Employee's services for and on behalf of
Employer is of material importance to the preservation and continued progress of
the Employer;
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, the parties agree as follows:
I. Term of Employment:
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A. Employer hereby employs the Employee as President and Chief
Executive officer as set forth herein and Employee hereby accepts
this employment and agrees to render such services to Employer on
the terms and conditions set forth in this Agreement.
B. The initial term of employment under this Agreement shall commence
November 20, 1990 and shall terminate November 20, 1995, unless
further extended or sooner terminated in accordance with the terms
and conditions of this Agreement; said term shall be extended
automatically for an additional one year on the first anniversary
of this Agreement and each annual anniversary thereafter through
November 20, 1993 unless the Board of Directors of Employer or
Employee gives contrary written notice to the other in accordance
with provisions of this Agreement.
II. Duties
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A. During the term of this Agreement, Employee shall have and
exercise such duties, responsibilities, privileges, powers and
authority commensurate with the positions of President and Chief
Executive Officer and as may be assigned him by the Board of
Directors of the Employer. He shall be responsible only to the
Board of Directors.
B. Employee has been elected to the Board of Directors and will be
retained in that position during the term of his employment.
C. Employer will continue to furnish Employee with a private office,
personal secretary and any other facilities, services and staff
that are necessary and adequate for the performance of his duties
and suitable to the position of the President and Chief Executive
Officer.
D. Employee will devote his time and best efforts to the business of
the Employer and to performing his duties hereunder. Employee
shall not, during his employment, be engaged in or concerned with
any other activities or pursuits which are competitive with the
business of the Employer.
III. Compensation
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A. As compensation for services rendered hereunder, the Employer
shall pay Employee the Annual base salary of not less than Two
Hundred Thousand ($200,000.00) Dollars, payable in equal monthly
installments on the first day of each and every month or in equal
installments on Employer's regularly designated pay dates.
B. Employee's salary shall be adjusted annually. The adjusted salary
shall be not less than the base salary for the "Upper 25%"
category under the designation of the Highest Paid Employee" as
shown in the current year's U.S. League Compensation Survey for
Financial Institutions of comparable assets and size for the year
in which the survey is conducted. However, regardless of the
salary permitted by the Compensation Survey, the Employee's base
salary shall not exceed Two Hundred Fifty Thousand ($250,00,00.00)
Dollars for the calendar year of 1991 and Three Hundred Thousand
($300,000.00) Dollars for the calendar year of 1992. All salary
adjustments shall be retroactive to January 1st for the year of
the survey.
Said survey shall be the basis for the annual adjustment for as
long as the survey is available; in the event the survey is no
longer available, a similar survey for Chief Executive Officers of
Financial Institutions shall be substituted.
IV. Benefits
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A. Employer agrees to include Employee and his dependents in the
hospitalization, surgical and medical benefit plan adopted by
Employer.
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B. In lieu of the Employer's policy for providing employees with
life insurance, the Employer agrees to include Employee under the
Employee's Group Term Life Insurance Policy in the amount of One
Million ($1,000,000) Dollars plus one year's annual salary. Life
insurance coverage shall be maintained after Employee's
retirement in the amount of Two Hundred Thousand ($200,000.00)
Dollars; Employee may, at his own discretion and expense,
increase this coverage through the Employer's carrier up to an
additional One Hundred Thousand ($100,000.00) Dollars.
C. Employer agrees to include Employee in the Employee Pension Plan.
In the event of termination under Paragraph VII.J., payments made
to the Employee and the term of said payments shall be eligible
for use in the calculation of pension benefits earned.
D. Employee shall be entitled to participate in any Employee bonus
plan in proportion to his compensation and position.
E. Employee shall be provided at all times with a luxury class
automobile that is not more than three (3) years old. Employee
may, at any time and at his option, purchase said vehicle for the
Employer's book value. In the event of termination or retirement,
for a period of one year thereafter, Employee may purchase said
vehicle for the Employer's book value as of the date of purchase.
F. Employer shall on behalf of the Employee pay all membership dues
and assessments to the Conewango Valley County Club and the
Conewango Club, both in Warren, Pennsylvania, and the Kahkwa
Club, Erie, Pennsylvania, or similar facilities in the community
of his residence.
G. Nothing in this Agreement shall be construed to limit or impair
Employee's right to participate in any and all employee benefit
plans of the Employer of every nature and Employee shall
participate in all such plans in proportion to his
compensation and position.
H. Nothing paid to Employee under any plan or arrangement presently
in effect or made available in the future shall be deemed to be
in lieu of the salary payable to Employee under Section III.
V. Reimbursement of Expenses
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Employee may incur reasonable expenses for promoting the Employer's
business including, but not by way of limitation, expenses for
entertainment, travel, conferences and seminars, and similar items.
Employer will reimburse Employee or otherwise provide for or pay for
all reasonable expenses incurred by Employee. Employee shall be
entitled to $200.00 per month for reasonable miscellaneous expenses
incurred by him without presentation of an itemized accounting;
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the presentation of an itemized accounting will be required only if the
items exceed $200.00 in any single month.
VI. Death/Disability
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A. If Employee dies during the term of his employment, Employer will pay
to Employee's window the amount of Employee's compensation, including
all bonus payments to which he would be entitled, for a period of one
(1) year from Employee's date of death, to be paid in equal monthly
installments. If Employee's spouse does not survive him, said payments
shall be made to his estate. Hospitalization, surgical and medical
plans and Club memberships shall continue for Employee's widow during
her lifetime. Employee's widow may also exercise the automobile
purchase option outlined in Paragraph IV.E.
B. If Employee becomes disabled during the employment term, the Employer
agrees to continue Employee's salary in accordance with Paragraph III
herein during such period of disability; however, should such period
exceed one year, Employee's disability payments shall be reduced to no
less than two-thirds (2/3's) of Employee's then annual salary until
date of normal retirement at Age 65. At Age 65, the Employee will be
entitled to the same retirement benefits that would have been
available had no disability occurred. If Employee dies during a period
of disability, Employee's spouse or estate shall be entitled to the
same benefits as if the Employee died during the employment term and
without disability.
VII. Termination
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A. Employer shall have the right, at any time upon prior written Notice
of Termination satisfying the requirements of Paragraph VII. Section
I, to terminate Employee's employment for just cause. For the purpose
of this Agreement, "termination for just cause" shall mean termination
for personal dishonesty, willful misconduct, breach of fiduciary duty
involving personal profit, willful violation of any law or regulation
(excepting traffic violations and other similar offenses), willful
violation of a final cease-and-desist order, or material breach or any
provision of this Agreement as determined by a court of competent
jurisdiction. For purposes of this paragraph, no act, or failure to
act, on the Employee's part shall be considered "willful" unless done,
or omitted to be done, by him not in good faith and without reasonable
belief that his action or omission was in the best interest of
Employer: provided that any act or omission
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to act on the Employee's behalf in reliance upon an opinion of
counsel to Employer or counsel to the Employee shall not be
deemed to be willful.
B. In the event employment is terminated for just cause pursuant to
Section A. Employee shall have no right to compensation or other
benefits for any period after the date of termination. If
Employee is terminated by Employer other than for just cause,
Employee's right to compensation and other benefits under this
Agreement shall be as set forth in Section J and Section L.
C. If Employee is suspended from office and/or temporarily
prohibited from participating in the conduct of Employer's
affairs pursuant to notice served under Section 8(a)(3) or (g)(1)
of the Federal Deposit Insurance Act, Employer's obligations
under this Agreement shall be suspended as of the date of
service, unless stayed by appropriate proceedings. If the charges
in the notice are dismissed, Employer shall (i) pay Employee all
the compensation withheld while contract obligations were
suspended and (ii) reinstate any of its obligations which were
suspended.
D. If Employee is removed from office and/or permanently prohibited
from participating in the conduct of Employer's affairs by an
order issued under Section 8(a)(4) or (g)(1) of the Federal
Deposit Insurance Act, all obligations of Employer under this
Agreement shall terminate, as of the effective date of the order,
but vested rights and rights of the Employee to compensation
earned as of the date of termination shall not be affected.
E. All obligations under this Agreement may be terminated: (i) by
Employer at the time the Federal Deposit Insurance Corporation
enters into an agreement to provide assistance to or on behalf of
the Employer under the authority contained in Section 13(c) of
the Federal Deposit Insurance Act, and (ii) by the Director of
the Office of Thrift Supervision at the time the Director of the
Office of Thrift Supervision approves a supervisory merger to
resolve problems related to operations of Employer or when the
Employer is determined by the Director of the Office of Thrift
Supervision to be in an unsafe or unsound condition, but rights
of the Employee to compensation earned as of the date of
termination shall not be affected.
F. If Employer is in default (as defined in Section 3(x)(1) of the
Federal Deposit Insurance Act), all obligations under this
Agreement shall terminate as of the date of default, but vested
rights and rights of the Employee to compensation earned as of
the date of termination shall not be effected.
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G. In the event that Employee is terminated in a manner which
violates the provisions of Section A, Employee shall be entitled
to reimbursement for all reasonable costs, including attorney's
fees in challenging such termination. Such reimbursement shall be
in addition to all rights to which Employee is otherwise entitled
under this Agreement.
H. On completion of thirty (30) years' service and having reached
the age of sixty (60) and less than age sixty-five (65), the
Employee may terminate his employment upon twelve (12) months'
written notice to Employer. In such event, Employee shall
continue to receive his present salary as provided in Paragraph
III for a period of two years from the date termination is
effective. The termination shall be considered early retirement
and all benefits contained in Paragraph IV, with the exception of
bonus provisions, shall continue. The Employee shall not accept
employment for a period of one year; thereafter, for a period of
four (4) years, he shall not become an employee of a firm or
entity involved in activities of the Employer within a one
hundred mile radius of Warren, Pennsylvania. Should employment
commence after one year from the date termination is effective,
the monthly salary provided for in this Paragraph VII-H shall be
decreased from the date of employment by any sum earned in the
new employment for the remainder of the two-year term.
I. Any termination of Employee's employment by Employer or by
Employee shall be consummated by written Notice of Termination to
the other party. For purposes of this Agreement, a "Notice of
Termination" shall mean a dated notice which (i) indicates the
specific termination provision in the Agreement relied upon; (ii)
sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of Employee's
employment under the provision so indicated; (iii) specifies a
date of termination (which shall not be less than twelve (12)
months or 365 days) after such Notice of Termination is given,
except in the case of termination by Employer of Employee's
employment for just cause pursuant to Section A, in which case
the Notice of Termination may specify a date of termination as of
the date such Notice of Termination is given); and (iv) be given
in writing sent by U.S. first-class certified or registered
mail, postage prepaid.
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J. Employer may terminate employment of Employee without cause upon
twelve (12) months' written notice to Employee. In such event,
Employee shall receive:
(1) One hundred (100%) percent of Employee's then annual
compensation as computed in accordance with Paragraph III
for the two-year period following the date termination is
effective; sixty (60%) percent of said compensation for the
subsequent year; and forty (40%) percent of said
compensation for the next succeeding one-year period.
(2) Termination shall be considered early retirement and all
benefits contained in Paragraph IV, with the exception of
bonus provisions, shall continue.
K. In the event of a reorganization, merger or consolidation, as
described in Paragraph VIII herein, Employee may terminate his
employment upon twelve months' written notice to Employer. In
such event, Employee shall receive a lump-sum payment equal to
three times the Employee's then annual compensation as computed
in Paragraph III; said payment shall be made on the date
termination is effective. If the severance payments would be
subject to excise tax imposed by Section 4999 of the Internal
Revenue Code, then the severence payments will be reduced to the
extent necessary to ensure that no portion of the payments are
subject to excise tax under Section 4999. The termination shall
be considered as early retirement and all benefits contained in
Paragraph IV, with the exception of the bonus provision, shall
continue.
X. Xxxxxxxxx pay based on length of service of Employee to Employer
and its predecessors, computed at the rate of one-half month's
base pay for every one year of service based upon Employee's than
annual compensation as computed in Paragraph III, will be paid on
the date termination under Paragraph VII.H. or VII.J. is
effective.
VIII. Reorganization - Merger
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If the Employer shall at any time be reorganized, merged or
consolidated into or with any other corporation or entity or if
substantially all of the assets of the Employer are transferred to
another corporation or entity, the provisions of this Agreement shall
survive any such transaction and shall be binding upon and inure to
the benefit of the Corporation resulting from such merger or
consolidation or the Corporation to which such assets will be
transferred.
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IX. Leased Property
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In the event employment is terminated by either party, Employer
shall purchase from Employee the building and lot presently
leased by Employer, located at Liberty and Xxxxx Streets, Warren,
Pennsylvania, and the purchase price shall be determined in
accordance with the formula contained in said lease for purchase
and shall be paid in full within one year of the Notice of
Termination.
X. General Provisions
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A. If either party waives a breach of this Agreement by the
other party, that waiver will not operate or be construed as
a waiver of later similar breaches.
B. Employer's rights and obligations under this Agreement will
inure to the benefit of and be binding upon Employer's
successors and assigns.
C. Employee's rights under this Agreement shall inure to the
benefit of Employee's heirs and assigns.
D. This Agreement may be modified in writing only and by mutual
consent of the parties.
NORTHWEST MUTUAL SAVINGS ASSOCIATION
d/b/a NORTHWEST SAVINGS BANK, PaSA
By: _____________________________________
By: _____________________________________
By: _____________________________________
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AMENDMENTS
Pursuant to resolutions of the Board of Directors on December 18, 1996, the
first sentence of section VII, Paragraph H is changed to read: "On completion of
thirty (30) years of service and having reached the age of sixty (60) and before
November 30, 1997, the employee may terminate his employment upon twelve (12)
months written notice to employer." The remaining text of Paragraph is
unchanged and in effect.
