EMPLOYMENT AGREEMENT
This Agreement made this 2nd day of February, 1998, by and between NORTH
VALLEY BANCORP, a California bank holding company, and NORTH VALLEY BANK, a
California banking corporation ("collectively, the "Employer""), and XXXXXX X.
XXXXXXXX ("Employee").
IT IS AGREED:
1. Employment. The Employer hereby employs the Employee and the Employee
hereby accepts the employment upon the terms and conditions set forth herein.
2. Duties. Employee shall perform the customary duties of the President
and Chief Executive Officer of a bank holding company and as President and Chief
Executive Officer of its subsidiaries, NORTH VALLEY BANK, NORTH VALLEY TRADING
COMPANY, and NORTH VALLEY BANK PROCESSING, INC.. In addition he shall perform
such kindred duties as may, from time to time, be reasonably requested of him by
the Board of Directors of the Employer.
3. Term. Subject to the provisions for termination as herein provided,
the term of this contract shall begin on February 1, 1998 and shall continue
indefinitely thereafter.
4. Salary. As compensation for the services rendered by him under this
Agreement, the Employee shall be entitled to an annual salary of $175,000.00,
which shall be paid by North Valley Bank. The Board of Directors shall, in
January each year, conduct a review of the performance of Employee during the
previous year. The Board
EXHIBIT 10(x)
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of Directors in its sole discretion shall determine whether Employee shall be
granted an increase in annual salary based upon said performance.
5. Extent of Services. The Employee shall devote substantially all of
his time, attention and energies to the business of the Employer. This shall not
be construed as preventing the Employee from engaging in appropriate civic,
charitable, or religious activities or investing his assets in such form and
manner as will not interfere or conflict with the full performance of the
services to be performed by Employee for Employer pursuant to this Agreement.
6. Vacation. The Employee shall be entitled to four (4) weeks vacation
annually pursuant to the provisions of the vacation policies established by the
Bank.
7. Other Benefits. Employee shall be entitled to the use of a bank
automobile and membership at Riverview Golf and Country Club.
8. Expenses. The Employee is authorized to incur reasonable expenses in
conducting his duties hereunder, including expenses for entertainment, travel,
and similar items. The Employer shall pay directly to or shall reimburse the
Employee for all such expenses upon the presentation by the Employee, from time
to time, of an itemized account of such expenditures.
9. Insurance. Employer hereby agrees, at its sole cost and expense, to
provide Employee with, at all times during the term of this Agreement, health
and accident insurance and term life insurance of a type and in an amount
generally made available by Employer to its executive employees.
10. Termination. This Agreement may be terminated without breach of this
Agreement at any time, subject to the provisions of Paragraph 11 hereof, in
accordance with any of the following provisions:
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(a) Employer shall have the right to terminate this Agreement
immediately for cause in the event Employee has willfully breached or
habitually neglected the duties which he was required to perform under
this Agreement or Employee commits acts of dishonesty, theft,
misappropriation or conversion of funds, disclosure of confidential
information or records of Employer by Employee or for other grounds of
cause specified in Section 2924 of the California Labor Code, by giving
Employee written notice thereof. The term of employment shall terminate
immediately upon receipt of notice by Employee.
(b) This Agreement shall terminate immediately upon the death of
Employee.
(c) In the event that Employee shall become permanently
incapacitated or disabled for a period of at least one hundred eighty
(180) days, so that it reasonably appears to Employer that he will be
unable to perform his duties hereunder, Employer shall have the right to
terminate this Agreement by giving Employee thirty (30) days' written
notice of such termination.
Not withstanding anything contained in this Paragraph to the contrary, no
termination of this Agreement for any reasons whatsoever shall in any manner
release, or be construed as releasing, any party hereto from any liability,
obligation or damage to the other party hereto arising out of, directly or
indirectly, any breach or default by said party of any term hereunder or the
failure of said party to comply with or perform any duty or obligation
hereunder.
11. Termination Without Cause. Employer may at any time during the term
of this contract give Employee thirty (30) days written notice terminating this
employment agreement.
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(a) In the event Employer gives notice of termination without cause
under this Paragraph 11, or in the event Employee separates from
employment with Employer following thirty (30) days written notice by
the Employee to the Employer within one year following a "Change in
Control" as defined herein in response to a "Constructive Termination,"
Employer shall pay to Employee as severance compensation an amount equal
to one and one-half times Employee's current annual base salary (not
including bonuses). "Constructive Termination" means a material
reduction in base salary, a material change in responsibilities, or a
requirement to relocate, except for office relocations that would not
increase the Employee's one-way commute distance by more than
thirty-five (35) miles.
i. "Change in Control" as used herein shall be a change in
control of North Valley Bancorp of a nature that would be required
to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A (or in response to any similar item on any similar
schedule or form) promulgated under the Securities Exchange Act of
1934, as amended.
(b) Employee may voluntarily terminate his employment with Employer
at any time with thirty (30) days written notice to Employer. The term
of employment shall end on the last day on which Employee performs
services for the Company and which no further salary shall be payable by
Employer to Employee.
12. Employment as Consultant and Restrictive Covenant. Upon the
termination of this Agreement by Employer in accordance with subparagraph (a) of
Paragraph 10 hereof or upon the voluntary termination of employment by Employee,
in accordance with subparagraph (b) of Paragraph 11, Employer shall have the
right, at its option, within thirty (30) days of such termination, to hire
Employee as a consultant for any period of
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whole months up to one (1) year from date of termination of employment, in
accordance with the following provisions:
(a) In the event of a termination of this Agreement by Employer in
accordance with subparagraph (a) of Paragraph 10 hereof, Employee shall
receive $833.33 monthly which shall be payable on the first day of each
month thereof until said consulting services are terminated; and
(b) In the event of a voluntary termination of this Agreement by
Employee in accordance with subparagraph (b) of Paragraph 11, Employee
shall receive a monthly payment at the same monthly salary rate to be
paid at the time of termination pursuant to this Agreement, which salary
shall be payable on the first day of each month thereof until said
consulting services are terminated.
Employee agrees that in the event Employer desires to employ him as a consultant
in accordance with the provisions hereof, he will accept such employment
continuously for the number of whole months up to one year from date of
termination of this Agreement. Employer may, however, give Employee written
notice of termination not less than ten (10) days in advance of any month and
terminating Employee's employment as a consultant at the end of that month.
Employee will not during the term of said employment as consultant, without the
prior written consent of Employer, directly or indirectly, engage for his own
account in any business, or own, manage, operate, control, be employed as an
employee or consultant, buy, participate in, or be connected in any manner with
the ownership, management operation or control of any firm, corporation,
association, or other business entity which is in competition with the business
of Employer. This covenant on the part of Employee shall be construed as an
agreement independent of any other provisions of this Agreement and shall
survive the termination of this Agreement, and the existence of any claims or
cause of action by Employee against Employer, whether predicated on this
Agreement or otherwise, shall not constitute
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a defense in the enforcement by Employer of this covenant. In the event that
Employee is employed as a consultant and Employer shall default for ten (10)
days after notice of default to the Employer in the payment of any monthly
installment of compensation due to Employee, Employee may, at his option,
terminate his employment as a consultant hereunder by delivering written notice
to Employer of such termination. In the event that Employee elects to terminate
his employment as a consultant in accordance with the foregoing, the foregoing
restrictive covenant shall cease to be effective and binding upon Employee.
13. Confidential Information. Employee agrees that he will not during
the term of this Agreement or at any time thereafter, either directly or
indirectly, disclose or make known to any other person, firm or corporation any
confidential information, trade secret, processes or names or addresses of any
of the customers or shareholders of Employer, or any other information
pertaining to said customers or shareholders that he may acquire in the
performance of his duties hereunder, nor will Employee make use of any such
information, secrets, processes or names or addresses or other information for
his own purposes or for the benefit of any person, firm, corporation or other
entity (other than Employer) under any circumstances, during or after the term
of his employment. Employee acknowledges and agrees that he has been privy to
valuable confidential information, trade secrets, processes and customer and
shareholder information belonging to Employer. Upon the termination of his
employment by Employer, Employee agrees forthwith to deliver to Employer any and
all literature, documents, correspondence, and other materials and records
furnished to him during the course of such employment.
14. Remedies for Breach. Employer and Employee both recognize that the
services to be rendered under this Agreement by Employee are special, unique and
of an extraordinary character, and that in the event of the breach by Employee
of any of the terms and conditions of this Agreement to be performed by him, the
Employer shall have
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the right to institute and prosecute proceedings, in law or in equity, in any
court of competent jurisdiction to obtain any injunction during the term of this
Agreement or after its termination, whether by expiration of its term or
otherwise, to enforce the provisions of Sections 12 and 13 hereof and to pursue
any other remedy, in law or in equity to which Employer may be entitled.
15. Notice. Any notice required or permitted to be given under this
contract shall be sufficient if in writing and if delivered by hand or sent by
registered mail certified mail or FedEx (or similar overnight carrier) to his
residence in the case or the Employee, or to its principal office in the case of
the Employer.
16. Waiver of Breach. The waiver by the Employer of the breach of any
provisions of this Agreement by the Employee shall not operate or be construed
as a waiver of any subsequent breach by the Employee.
17. Assignment. The rights and obligations of the Employer under this
Agreement shall insure to the benefit and shall be binding upon the successors
and assigns of the Employer; however, the rights and benefits of the Employee
under this Agreement are personal to him, and no right or benefit accruing to
the Employee under this Agreement shall be subject to voluntary or involuntary
alienation, assignment or transfer.
18. Attorneys Fees. In any action or proceeding arising out of this
Agreement, the prevailing party shall be entitled to reasonable attorney's fees
and costs.
19. Entire Agreement. This Agreement and the provisions of the letter
offering employment dated January 7, 1998 represent the entire agreement of the
parties and any modifications hereto shall be in writing signed by the parties.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
EMPLOYER: EMPLOYEE:
NORTH VALLEY BANCORP
By /s/ Xxxx X. Xxxxx /s/ Xxxxxx X. Xxxxxxxx
----------------------------- ----------------------------
Xxxx X. Xxxxx Xxxxxx X. Xxxxxxxx
Chairman of the Board
NORTH VALLEY BANK
By /s/ Xxxx X. Xxxxx
-----------------------------
Xxxx X. Xxxxx
Chairman of the Board
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