EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of
the 1st day of August, 2005 by and between The Vintage Bank, a California
corporation (the "Bank"), and Xxxx X. Xxxxxxx (the "Employee").
BACKGROUND
----------
WHEREAS, the Employee is currently employed by the Bank and possesses
valuable knowledge and skills that have contributed to the operation of the Bank
and its Xxxxxx Bank division;
WHEREAS, the Bank desires to continue Employee's employment and the
Employee is willing to continue to be employed by the Bank, upon the terms and
subject to the conditions hereinafter set forth; and
WHEREAS, the Bank is a wholly-owned subsidiary of North Bay Bancorp, a
California corporation (the "Company").
NOW, THEREFORE, in consideration of the premises, agreements and mutual
covenants set forth herein, the parties hereto hereby agree as follows:
1. Employment
----------
1.1 General. The Bank hereby employs the Employee as President of its
Xxxxxx Bank division on the terms and subject to the conditions contained in
this Agreement, and the Employee hereby accepts such employment on the terms and
subject to the conditions contained in this Agreement.
1.2 Duties of Employee. During the Term of this Agreement, the Employee
shall diligently perform all duties and responsibilities reasonably accorded to
and expected of the President of the Xxxxxx Bank division of the Bank and as may
be assigned to him by the Board of Directors of the Bank (the "Board of
Directors"), the Chief Executive Officer of the Bank, or the President and Chief
Executive Officer of the Company, and shall exercise such power and authority as
may from time to time be delegated to him thereby. The Employee shall devote his
full business time and attention to the business and affairs of the Bank as
necessary to perform his duties and responsibilities hereunder, render such
services to the best of his ability and use his best efforts to promote the
interests of the Bank. The Employee shall faithfully adhere to, execute and
fulfill all policies established by the Bank.
1.3 Place of Performance. Except for required travel for the Bank's
business, the Employee shall perform his duties and responsibilities from the
offices of the Company and the Xxxxxx Bank division of the Bank.
2. Term. Subject to the provisions of Section 4 of this Agreement, the
initial term of Employee's employment hereunder shall commence on the date of
this Agreement (the "Effective Date") and shall continue thereafter until the
third anniversary of the Effective Date (the "Initial Term"). Unless the
Employee shall have notified the Bank, or the Bank shall have notified the
Employee, not less than sixty days prior to the expiration of the Initial Term
of such party's election not to continue the Term of this Agreement, upon
expiration of the Initial Term, the Employee's employment hereunder shall
continue until the fourth anniversary of the Effective Date and thereafter shall
continue on a year-to-year basis unless either party notifies the other, not
less than sixty days prior to expiration of the then current Renewal Term, of
such party's election not to continue the Term of this Agreement (each such
additional one-year period, a "Renewal Term"; the Initial Term and any Renewal
Term are collectively referred to hereinafter as the "Term"). The election by
the Bank not to continue the Term of Employee's employment for a Renewal Term
shall not be deemed a termination without Cause pursuant to Section 4.1(b)
hereof except as expressly provided in Section 4.1(d) hereof.
3. Compensation.
-------------
3.1 Salary. During the Term of the Employee's employment hereunder, the
Employee shall receive an annual salary of one hundred thirty four thousand
dollars ($134,000) payable at such times and in such manner as the Bank's normal
payroll schedule may from time to time provide. Employee's annual salary shall
be subject to annual adjustment as may be determined by the Board of Directors
in its sole and absolute discretion.
3.2 Incentive Compensation. The Employee shall be eligible to receive as
additional compensation each year during his employment hereunder, as determined
by the Board of Directors or an applicable committee thereof, in accordance with
the terms of an Incentive Compensation Plan adopted annually by the Board of
Directors. Such additional compensation (if any) to be paid at a time or times
and in a manner consistent with the Bank's normal practices for the payment of
bonuses, or as the Board of Directors or applicable committee may otherwise
determine.
3.3 Benefits. During his employment hereunder, the Employee shall be
entitled to participate in all plans adopted for the general benefit of the
Bank's management employees, including medical plans and 401(k) plan, to the
extent that the Employee is and remains eligible to participate therein and
subject to the eligibility provisions of such plans in effect from time to time.
In the event Employee's employment hereunder is terminated and the Employee is
entitled to compensation pursuant to Section 4.4(d), the Employee shall be
entitled to continue to participate in the Bank's medical plan until the earlier
of (a) expiration of the applicable payment period set forth in Section
4.4(d)(i) or (b) the date Employee obtains new employment.
3.4 Paid Time Off ("PTO"). During each calendar year of his employment
hereunder, the Employee shall be entitled to twenty-five (25) days of PTO in
accordance with the Bank's PTO policy, prorated for any period of employment of
less than an entire year, provided that PTO will continue to accrue only so long
as Employee's total accrued PTO does not exceed thirty-five (35) days. Should
2
Employee's accrued PTO reach thirty-five (35) days, Employee will cease to
accrue further PTO until Employee's accrued PTO falls below that level.
Notwithstanding anything contained in the foregoing, Employee shall take not
less than ten (10) consecutive days of PTO during each calendar year during the
Term of this Agreement. Employee may be absent from his employment for PTO only
at such time as the President and Chief Executive Officer of the Company shall
determine from time to time.
3.5 Withholding. Notwithstanding any provision in this Agreement to the
contrary, all payments required to be made by the Bank to the Employee hereunder
or otherwise arising out of, related or incidental to or in connection with the
Employee's employment hereunder shall be subject to withholding of such amounts
relating to taxes as the Bank may reasonably determine it should withhold
pursuant to any applicable law or regulation.
3.6 Reimbursement of Expenses. The Bank agrees to reimburse the Employee
for all reasonable business travel and other out-of-pocket expenses incurred by
the Employee in the discharge of his duties hereunder, subject to the Bank's
reimbursement policies in effect from time to time. All reimbursable expenses
shall be appropriately documented in reasonable detail by the Employee upon
submission of any request for reimbursement, and in a format and manner
consistent with the Bank's expense reporting policy, as well as applicable
federal and state record keeping requirements.
3.7. Automobile. The Bank will pay to Employee an automobile allowance in
the amount of five hundred dollars ($500) per month. The Employee shall be
responsible for insurance and maintenance costs associated with such
automobile's operation. The Employee shall not be entitled to reimbursement for
mileage. Employee shall procure and maintain an automobile liability insurance
policy on the automobile, with coverage including Employee for at least a
minimum of $300,000 for bodily injury or death to any one person in any one
accident, and $100,000 for property damage in any one accident. The Employer
shall be named as an additional insured and Employee shall provide Employer
copies of policies evidencing insurance and Employer's inclusion as an
additional insured.
4. Termination
-----------
4.1 By Bank.
--------
(a) With Cause. Notwithstanding any provision in this Agreement
to the contrary, the Employee's employment hereunder may be terminated by the
Bank at any time for "Cause," and such termination shall be effective
immediately upon written notice to the Employee. For purposes of this Agreement,
"Cause" for the termination of the Employee's employment hereunder shall be
deemed to exist if, in the reasonable judgment of the Board of Directors: (i)
the Employee commits fraud, theft or embezzlement against the Bank, or any
subsidiary or affiliate thereof; (ii) the Employee commits a felony or a crime
involving moral turpitude; (iii) the Employee compromises trade secrets or other
proprietary information of the Bank, or any subsidiary or affiliate thereof;
(iv) the Employee breaches any non-solicitation agreement with the Bank, or any
3
subsidiary or affiliate thereof; (v) the Employee breaches any of the terms of
this Agreement (other than those referenced in clauses (iii) and (iv) of this
Section 4.1(a)) and fails to cure such breach within ten (10) days after the
receipt of written notice of such breach from the Bank; (vi) the Employee
engages in any grossly negligent act or willful misconduct that causes, or could
be reasonably expected to cause, harm to the business, operations or reputation
of the Bank, or any subsidiary or affiliate thereof; or (vii) the Bank, or any
subsidiary or affiliate thereof, is ordered to terminate this Agreement by any
governmental regulatory agency with supervisory authority over the Bank, or any
subsidiary or affiliate thereof.
(b) Without Cause. The Bank may at any time, in its sole and
absolute discretion, terminate the employment of the Employee hereunder without
Cause, or otherwise without any cause, reason or justification, provided that
the Bank provides to the Employee written notice (the "Termination Notice") of
such termination. In the event of any such termination by the Bank, the
Employee's employment with the Bank shall cease and terminate on the date
specified in the Termination Notice.
(c) For Disability of the Employee. If, as a result of incapacity
due to physical or mental illness or injury, the Employee is determined to be
disabled under any disability policy maintained by the Bank or, in the event no
such policy is maintained by the Bank, the Employee shall have been unable to
perform the essential functions of his position, with or without reasonable
accommodation, on a full-time basis for a period of sixty (60) consecutive days,
or for a total of ninety (90) days in any twelve-month period (a "Disability"),
then thirty (30) days after written notice to the Employee (which notice may be
given before or after the end of the aforementioned periods, but which shall not
be effective earlier than the last day of the applicable period), the Bank may
terminate the Employee's employment hereunder if the Employee is unable to
resume his full-time duties at the conclusion of such notice period.
4.2 Death of the Employee. This Agreement shall immediately cease and
terminate upon the death of Employee.
4.3 Termination by Employee. The Employee may terminate his employment
under this Agreement upon not less than thirty (30) days prior written notice to
the Bank. Upon learning that the Employee is terminating his employment under
this Agreement, the Bank may, in its sole discretion but subject to its other
obligations under this Agreement, relieve Employee of his duties under this
Employment Agreement, and assign Employee other reasonable duties and
responsibilities to be performed until the termination becomes effective.
4
4.4 Compensation Upon Early Termination.
------------------------------------
(a) As a Result of Death, Cause or Resignation. If the Employee's
employment under this Agreement is terminated prior to the scheduled expiration
of the Term by reason of his death, termination by the Bank for Cause or
resignation by the Employee, the Employee shall be entitled to be paid solely
(i) the Employee's salary then in effect through the effective date of
termination, (ii) any accrued PTO due pursuant to Section 3.4, (iii) any amounts
due pursuant to Section 3.6, (iv) those benefits, if any, that have vested by
operation of state or federal law or under any written term of a plan ("Vested
Benefits"), and (v) health care coverage continuation rights under the
Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA Rights"), and the
Bank shall have no further liability or other obligation of any kind whatsoever
to the Employee. In the case of termination as a result of the death of
Employee, any amounts due pursuant to this Section 4.4(a) shall be paid to the
Employee's estate, heirs (at law), devisees, legatees or other proper and
legally entitled descendants, or the personal representative, executor,
administrator or other proper legal representative on behalf of such
descendants.
(b) By the Bank other than for Cause. Except as otherwise
expressly provided in Section 4.4(d), if, prior to the scheduled expiration of
the Term, the Bank terminates the Employee's employment without Cause, the
Employee shall be entitled to receive and be paid solely (i) the Employee's
salary then in effect until the expiration of six months following the effective
date of the termination of Employee's employment payable over such period at the
Bank's regular and customary intervals for the payment of salaries as in effect
from time to time ("Severance Pay"), (ii) any accrued PTO due pursuant to
Section 3.4, (iii) any amounts due pursuant to Section 3.6, (iv) any Vested
Benefits, and (v) any COBRA Rights, and the Bank shall have no further liability
or other obligation of any kind whatsoever to the Employee. The payment of
Severance Pay shall constitute liquidated damages in lieu of any and all claims
by the Employee against the Bank, shall be in full and complete satisfaction of
any and all rights which the Employee may enjoy hereunder, and shall constitute
consideration for a full and unconditional release of any and all liability of
the Bank or any of its shareholders, benefit plans, affiliate companies,
subsidiaries, and the directors, officers, employees, trustees and agents of
such entities and their successors or assigns, arising out of this Agreement or
out of the employment relationship between the Employee and the Bank (in the
form of Exhibit A, hereafter the "Release"). Payment of the Severance Pay is
expressly conditioned upon receipt by the Bank of the Release executed by the
Employee.
(c) Disability. For the sixty (60) day period following onset of
the Employee's Disability, Employee shall be entitled to receive and be paid
solely (i) the Employee's salary then in effect until the expiration of said
sixty (60) day period payable over such period of time at the Bank's regular and
customary intervals for the payment of salaries as in effect from time to time,
(ii) any accrued PTO due pursuant to Section 3.4, (iii) any amounts due pursuant
to Section 3.6, (iv) any Vested Benefits, and (v) any COBRA rights. Following
expiration of the sixty (60) day period, the Employee shall be entitled to
receive and be paid solely a salary at a rate commensurate with the benefit
Employee is eligible to receive under any disability policy maintained by the
5
Bank for a period of one hundred twenty (120) days or until Employee's benefits
under any disability policy maintained by the Bank for the Employee commences,
whichever period is shorter, payable over such period of time at the Bank's
regular and customary intervals for the payment of salaries as in effect from
time to time, and the Bank shall have no further liability or other obligation
of any kind whatsoever to the Employee.
(d) Change in Control. Notwithstanding anything contained in the
foregoing, if within one year of the effective date of a Change in Control (as
defined below), of the Company (i) Employee's employment under this Agreement is
terminated by the Bank, its assignee or successor, without Cause (including, for
purposes of this Section 4.1(d), an election by the Bank not to continue to Term
of Employee's employment) or (ii) Employee terminates his employment under this
Agreement on account of (y) Employee's position, responsibilities or working
conditions being substantially diminished or (z) a material reduction in the
Employee's compensation or benefits, the Employee shall be entitled to receive
and be paid compensation as follows in lieu of compensation payable pursuant to
Section 4.4(b):
(i) Less Than Five Years of Service. If as of the
effective date of the Change in Control of the Company the Employee has
completed less than five years of service to the Bank (including service to any
predecessor or subsidiary of the Bank and service to Xxxxxx Bank measured from
the date service thereto commenced which the parties agree was April 15, 2002),
the Employee shall be entitled to receive and be paid an amount equal to (a) the
Employee's annual salary then in effect plus (b) the average of the incentive
compensation paid to the Employee for the two most recently completed fiscal
years of the Bank. Said amount shall be payable to the Employee for a period of
twelve months following the effective date of the termination of the Employee's
employment (the "Date of Termination"). Said amount shall be payable for such
period at the Bank's regular and customary intervals for the payment of salaries
as in effect from time to time. In addition, the Employee shall be entitled to
receive and be paid (v) any accrued PTO due pursuant to Section 3.4, (w) any
amounts due pursuant to Section 3.6, (x) any Vested Benefits, (y) any COBRA
rights, and (z) prorated incentive compensation for the current fiscal year of
the Bank; or
(ii) More than Five Years of Service. If as of the
effective date of the Change in Control of the Company the Employee has
completed five or more years of service to the Bank (including service to any
predecessor or subsidiary of the Bank and service to Xxxxxx Bank measured from
the date service thereto commenced with the parties agree was April 15, 2002),
the Employee shall be entitled to receive and be paid an amount equal to two
times (a) the Employee's annual salary then in effect plus (b) the average of
the incentive compensation paid to the Employee for the two most recently
completed fiscal years of the Bank. Said amount shall be payable to the Employee
for a period of twenty-four months following the Date of Termination. Said
amount shall be payable for such period at the Bank's regular and customary
intervals for the payment of salaries as in effect from time to time. In
addition, the Employee shall be entitled to receive and be paid (v) any accrued
PTO due pursuant to Section 3.4, (w) any amounts due pursuant to Section 3.6,
(x) any Vested Benefits, (y) any COBRA rights, and (z) prorated incentive
compensation for the current fiscal year of the Bank.
6
(e) Change in Control Defined. "Change in Control" means in any
transaction or related series of transactions: (a) the acquisition (other than
solely from the Company), by any individual, entity or group (within the meaning
of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act), other than the
Company or any subsidiary, affiliate (within the meaning of Rule 144 under the
Securities Act of 1933, as amended) or employee benefit plan of the Company, of
beneficial ownership (within the meaning of Rule 13(d)(3) promulgated under the
Exchange Act) of more than 30% of the combined voting power of the then
outstanding securities of the Company entitled to vote generally in the election
of directors (the "Voting Securities"); (b) a reorganization, merger,
consolidation, share exchange or recapitalization of the Company (a "Business
Combination"), other than a Business Combination in which more than 50% of the
combined voting power of the outstanding voting securities of the surviving or
resulting entity immediately following the Business Combination is held by the
persons who, immediately prior to the Business Combination, were the holders of
the Voting Securities; or (c) a complete liquidation or dissolution of the
Company, or a sale of all or substantially all of the Company's assets.
(f) Tax Gross-Up Payment. In the event the compensation payable
to the Employee pursuant to and by reason of Section 4.4(d) hereof and otherwise
payable by the Bank to the Employee by reason of a Change in Control of the
Company (including without limitation, accelerated vesting of stock options and
other compensation payable outside of this Agreement (together the "Total
Benefits"), but determined without regard to any additional payments required
under this Section 4.4(f)) constitute excess parachute payments within the
meaning of Section 280G of the Internal Revenue Code (the "Code") and the
Employee will be subject to the excise tax imposed by Section 4999 of the Code,
then the aggregate compensation payable to the Employee pursuant to and by
reason of Section 4.4(d) shall be increased by an additional amount (the
"Gross-Up Payment") such that the net amount retained by the Employee, after
deduction of any excise tax on the Total Benefits and any federal, state and
local income tax, excise taxes and FICA Medicare withholding taxes upon the
Gross-Up Payment shall be equal to the Total Benefits. The Gross-Up Payment
shall be calculated, and all assumptions to be utilized in performing such
calculation, shall be made by the Bank's independent auditors (the "Accounting
Firm") which shall provide detailed supporting calculations both to the Bank and
the Employee within fifteen (15) business days after the Date of Termination
(defined in Section 4(d)(i)). The calculation of the Gross-Up Payment by the
Accounting Firm shall be binding upon the Bank and Employee unless with ten (10)
business days of receiving the calculations from the Accounting Firm either
party objects to the calculation by serving upon the other party a written
notice of objection (which shall contain specific details supporting the
objection). In the event of a timely objection to the calculation, the Bank and
Employee shall meet and in good faith attempt to resolve the objection. If the
parties fail to resolve the objection with ten (10) business days of receipt of
7
the objection, either party may initiate arbitration, and the dispute shall be
resolved by arbitration, pursuant to Section 11 hereof. All reasonable fees and
expenses of the Accounting Firm shall be borne solely by the Bank. The Gross-Up
Payment shall be added to the aggregate compensation payable to the Employee
pursuant to and by reason of Section 4.4(d) and be payable over the applicable
payment period set forth in Section 4.4(d)(i) or (ii), subject to withholding
pursuant to Section 3.5 hereof.
4.5 Expiration of the Term. If not sooner terminated, Employee's employment
hereunder shall terminate on the expiration of the Initial Term or the Renewal
Term, as applicable in accordance with Section 2 hereof. Not less than 45 days
prior to the scheduled expiration of Employee's employment hereunder, the
parties agree to commence discussions with respect to the possible extension of
the Term of this Agreement, possible execution of a new employment agreement or
other possible continuation of the Employee's employment (it being understood
and agreed that no such discussion shall imply any current or future obligation
or commitment to enter into any such agreement or extension or any other
expressed or implied arrangement for the continued employment of the Employee
following the expiration of the Initial Term or any other termination of the
Employee's employment hereunder).
5. Agreement Not to Solicit Customers. The Employee agrees that, during the
Term of his employment with the Bank or any entity owned by or affiliated with
the Bank (whether pursuant to this Agreement or otherwise), and for two (2)
years following the termination thereof whether or not for any reason
whatsoever, he will not, either directly or indirectly, call on, solicit, or
take away as a client, customer or prospective client or customer, or attempt to
call on, solicit, or take away as a client, customer or prospective client or
customer, any person or entity that was a client, customer or prospective client
or customer of the Bank, or any subsidiary or affiliate thereof. For purposes of
this agreement "prospective client or customer" shall include any person or
entity with whom the Bank has had contact for the purpose of soliciting business
within the six months prior to the termination of employment or whom the Bank
intended to contact for the purpose of soliciting business within six months
after termination of employment, of which contact or intended contact the
Employee had knowledge while employed by the Bank.
6. Agreement Not to Solicit or Hire Employees. The Employee agrees that
during the Term of his employment with the Bank or any entity owned by or
affiliated with the Bank (whether pursuant to this Agreement or otherwise), and
for two (2) years following the termination thereof whether or not for any
reason whatsoever, he will not, either directly or indirectly, on his own behalf
or in the service or on behalf of others, solicit or divert, attempt to solicit
or divert or induce or attempt to induce to discontinue employment with the
Bank, or any subsidiary or affiliate thereof, any person employed by the Bank,
or any subsidiary or affiliate thereof, whether or not such employee is a full
time employee or a temporary employee of the Bank, or any subsidiary or
affiliate thereof and whether or not such employment is for a determined period
or is at will.
8
7. Ownership and Non-Disclosure and Non-Use of Confidential Information.
---------------------------------------------------------------------
7.1 Confidential Information. As used in this Agreement, "Confidential
Information" shall mean all customer deposit, loan, sales and marketing
information, customer account records, proprietary receipts and/or
processing techniques, information regarding vendors and products, training
and operations memoranda and similar information, personnel records,
pricing information, financial information and trade secrets concerning or
relating to the business, accounts, customers, employees and affairs of the
Bank, or any subsidiary or affiliate thereof, obtained by or furnished,
disclosed or disseminated to the Employee, or obtained, assembled or
compiled by the Employee or under his supervision during the course of his
employment by the Bank, and all physical embodiments of the foregoing, all
of which are hereby agreed to be the property of and confidential to the
Bank, but Confidential Information shall not include any of the foregoing
to the extent that the Employee can show that the same is or becomes
publicly known through no action, omission, fault or breach of this
Agreement by the Employee.
7.2. Ownership. The Employee acknowledges and agrees that all
Confidential Information, and all physical embodiments thereof, are
confidential to and shall be and remain the sole and exclusive property of
the Bank. The Employee agrees that upon request by the Bank, and in any
event upon termination of the Employee's employment with the Bank whether
or not for any reason whatsoever, the Employee shall deliver to the Bank
all property belonging to the Bank, or any of its subsidiaries or
affiliates, including, without limitation, all Confidential Information
(and all embodiments thereof), then in his custody, control or possession.
7.3 Non-Disclosure and Non-Use. The Employee agrees that he will not,
either during the Term of his employment hereunder or at any time
thereafter, use, disclose or make available any Confidential Information to
any person or entity, nor shall he use, disclose, make available or cause
to be used, disclosed or made available, or permit or allow, either on his
own behalf or on behalf of others, any use or disclosure of such
Confidential Information other than in the proper performance of the
Employee's duties hereunder.
8. Reasonableness of Restrictions. In the event that any provision relating
to time period set forth in Xxxxxxx 0, 0, xx 0 xxxxx xx held by a court of
competent jurisdiction to exceed the maximum time period that the court deems
reasonable and enforceable, the time period which the court finds to be
reasonable and enforceable shall be deemed to become, and thereafter shall be,
the maximum time period of such restriction as to such jurisdiction.
9. Enforceability. Any provision of this Agreement which is held by a court
of competent jurisdiction to be invalid or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, but
shall be enforced to the maximum extent permitted by law, and any such holding
of invalidity or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
9
10. Injunction. The Employee represents that his experience and
capabilities are such that the provisions of Sections 5, 6, and 7 will not
prevent him from earning his livelihood, and acknowledges that a breach by the
Employee of any of the covenants contained therein will cause irreparable harm
and damage to the Bank, the monetary amount of which may be virtually impossible
to ascertain. As a result, the Employee recognizes and hereby acknowledges that
the Bank shall be entitled to an injunction from any court of competent
jurisdiction enjoining and restraining any violation of any or all of the
covenants contained in Section 5, 6, and/or 7 of this Agreement by the Employee
or any of his affiliates, associates, partners or agents, either directly or
indirectly, without any requirement to post bond or other security and that such
right to injunction shall be cumulative and in addition to whatever other
remedies the Bank may possess.
11. Arbitration. Subject to the provisions of Section 10 hereof regarding
the remedy of injunctive relief, any dispute (whether based on contract, tort,
or statutory duty or prohibition) arising out of or in connection with this
Agreement shall be submitted to binding arbitration, in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (as
modified by this Agreement) by one arbitrator, designated in accordance with
those rules. No one who has ever had any business, financial, family, or social
relationship with any party to this Agreement shall serve as an arbitrator
unless the related party informs the other party of the relationship and the
other party consents in writing to the use of that arbitrator.
The party demanding arbitration shall submit a written claim to the other
party, setting out the basis of the claim. A prearbitration hearing shall be
held within twenty (20) business days after the arbitrator's selection. The
arbitration shall be held within ninety (90) calendar days after the
prearbitration hearing. The arbitrator shall establish any deadlines to
accomplish this goal. The arbitration shall take place in Napa, California, at a
time and place selected by the arbitrator.
Each party shall be entitled to discovery of essential documents and
witnesses, as determined by the arbitrator. No less than thirty (30) calendar
days before the arbitration, a party may serve a document request calling for
any document that would be discoverable in a state civil proceeding. The served
with this request shall deliver the requested documents and any objections
within ten (10) calendar days. The arbitrator may resolve any dispute over the
exchange of documents. Each party may take no more than three (3) depositions,
unless additional depositions are allowed by the arbitrator for good cause. All
depositions must be completed as of fifteen (15) calendar days before the
arbitration hearing unless the parties otherwise agree. The arbitrator may
resolve any dispute over the depositions as they would be resolved in a state
civil proceeding. Any motion may be heard by the arbitrator on three (3) days
notice unless the parties otherwise agree. The arbitrator shall apply California
law.
10
The parties agree that all information supplied by any party shall be
deemed to be confidential information, and the arbitrator and other participants
in the dispute shall protect such information from disclosure to the same extent
as confidential information under Section 7 of this Agreement.
The arbitrator shall have the following powers:
(a) To issue subpenas for the attendance of witnesses and subpenas
duces tecum for the production of books, records, documents, and
other evidence;
(b) To order depositions to be used as evidence;
(c) Consistent with the discovery procedures enumerated above, to
enforce the rights, remedies, procedures, duties, liabilities,
and obligations of discovery as if the arbitration were a civil
action before a California superior court;
(d) To conduct a hearing on the arbitration issues and related legal
and discovery issues;
(e) To administer oaths to parties and witnesses;
(f) To award all damages and remedies which would be available in a
civil action before a California superior court.
(g) To award expenses and fees of arbitration as the arbitrator deems
proper; and
(h) To order such other relief as the arbitrator deems proper.
Within fifteen (15) calendar days after completion of the arbitration, the
arbitrator shall submit a tentative decision in writing specifying the reasoning
for the decision and any calculations necessary to explain the award. Each party
shall have fifteen (15) calendar days in which to submit written comments to the
tentative decision. Within ten (10) calendar days after the deadline for written
comments, the arbitrator shall announce the final award. Any party may enter the
final award as a judgment in any court of competent jurisdiction.
The Bank shall pay the arbitrator's expenses and fees, all meeting room
charges, and any other expenses that would not have been incurred if the case
were litigated in the judicial forum having jurisdiction over it. Unless
otherwise ordered by the arbitrator, each party shall pay its own attorney fees,
witness fees and other expenses incurred by the party for his or its own
benefit. The arbitrator may award the prevailing party his or its expenses and
fees of arbitration, including reasonable attorney fees and costs, including
witness fees, in such proportion as the arbitrator decides.
11
12. No Prior Agreements. The Employee represents and warrants that he is
not a party to or otherwise subject to or bound by the terms of any contract,
agreement or understanding which in any manner would limit or otherwise affect
his ability to perform his obligations hereunder, including without limitation
any contract, agreement or understanding containing terms and provisions in any
manner similar to those contained in Sections 5, 6, and/or 7 hereof. The
Employee further represents and warrants that his employment with the Bank will
not require him to disclose or use any confidential information belonging to
prior employers or other persons or entities.
13. Assignment. The Employee shall not delegate his employment obligations
pursuant to this Agreement to any other person. This Agreement may be assigned
by the Bank without the Employee's consent. The rights and protections of the
Bank hereunder shall extend to any successors or assigns of the Bank and to the
Bank's present or future parents, subsidiaries, divisions and affiliates.
14. Employer's Authority. The relationship between the parties hereto is
that of employer and employee. The Employee agrees to observe and comply with
the rules and regulations of the Bank, as adopted by the Bank from time to time
with respect to the performance of the duties of the Employee. The Employee
acknowledges that he has no authority to enter into any contracts or other
obligations that are binding upon the Bank unless such contracts or obligations
are authorized by the Board of Directors. The Bank shall have the power to
direct, control and supervise the duties to be performed by the Employee, the
manner of performing said duties, and the time of performing said duties.
15. Governing Law. This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto, shall be governed
by and construed in accordance with the laws of the State of California, without
giving effect to any of the conflicts of laws provisions thereof that would
compel the application of the substantive laws of any other jurisdiction. The
Bank and the Employee each hereby irrevocably submit to the jurisdiction of the
state or federal courts located in the State of California in connection with
any suit, action or other proceeding arising out of or relating to this
Agreement and hereby agree not to assert, by way of motion, as a defense, or
otherwise in any such suit, action or proceeding that the suit, action or
proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or the subject matter
hereof may not be enforced by such courts.
16. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements, understandings and arrangements, both oral and
written, between the parties hereto with respect to such subject matter.
17. Notices. All notices, requests, demands and other communications under
this Agreement will be in writing and will be deemed to have been duly given (a)
on the date of the service if served personally on the party to whom notice is
to be given, (b) on the date of transmission if transmitted by facsimile with
confirmation of receipt, (c) on the date of receipt if mailed to the party to
12
whom notice is to be given by first class mail, registered or certified, postage
prepaid or by overnight courier service (i.e., Federal Express or equivalent)
and unless either party should notify the other of a change of address properly
addressed as follows, or (d) otherwise on the date of receipt when the intended
recipient has acknowledged receipt:
(i) If to the Employee:
Xxxx X. Xxxxxxx
_______________________
_______________________
(ii) If to the Bank:
The Vintage Bank
0000 Xxxxxxx Xxxx, Xxxxx 000
P.O. Box 2200
Xxxx, Xxxxxxxxxx 00000
Attention: President and Chief Executive Officer
of North Bay Bancorp
Facsimile: (000) 000-0000
18. Binding Effect. The obligations of the Employee under this Agreement
shall continue after the expiration of this Agreement and the termination of his
employment with the Bank for any reason, shall be binding upon his heirs,
executors, personal representatives, legal representatives and assigns and shall
inure to the benefit of any successor and assigns of the Bank.
19. Severability. The invalidity of any one or more of the words, phrases,
sentences, clauses, sections or subsections contained in this Agreement shall
not affect the enforceability of the remaining portions of this Agreement or any
part thereof, all of which are inserted conditionally on their being valid in
law, and, in the event that any one or more of the words, phrases, sentences,
clauses, sections or subsections contained in this Agreement or any part thereof
shall be declared invalid, this Agreement shall be construed as if such invalid
word or words, phrase or phrases, sentence or sentences, clause or clauses,
section or sections or subsection or subsections had not been inserted. If such
invalidity is caused by length of time or size of area, or both, the otherwise
invalid provision will be considered to be reduced to a period or area which
would cure such invalidity.
20. Section Headings. The section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
13
21. No Third Party Beneficiary. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person
other than the parties hereto and their respective heirs, personal
representative, legal representative, successors and assigns, any rights or
remedies under or by reason of this Agreement.
22. Amendment; Modification; Waiver. No amendment, modification or waiver
of the terms of this Agreement shall be valid unless made in writing and duly
executed by the Bank and the Employee. No delay or failure at any time on the
part of the Bank in exercising any right, power or privilege under this
Agreement, or in enforcing any provision of this Agreement, shall impair any
such right, power or privilege, or be construed as a waiver of any default or as
any acquiescence therein, or shall affect the right of the Bank thereafter to
enforce each and every provision of this Agreement in accordance with its terms.
The waiver by either party hereto of a breach or violation of any term or
provision of this Agreement shall neither operate nor be construed as a waiver
of any subsequent breach or violation.
THE EMPLOYEE ACKNOWLEDGES THAT HE HAS READ AND UNDERSTANDS THE FOREGOING
PROVISIONS AND THAT SUCH PROVISIONS ARE REASONABLE AND ENFORCEABLE.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be executed as of the day and year first above written.
EMPLOYEE
/s/ Xxxx X. Xxxxxxx
------------------------------
Xxxx X. Xxxxxxx
BANK
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------
Xxxxx X. Xxxxxxxx
Chief Executive Officer
14
