THIS DOCUMENT IS A COPY OF THE AGREEMENT FOR SERVICES FILED ON MAY
15, 1996 PURSUANT TO A RULE 201 TEMPORARY HARDSHIP EXEMPTION
AGREEMENT
THIS AGREEMENT is made this 31st day of January, 1996, by and
between LIBERTY NATIONAL BANK, a national banking association,
with offices at One Pacific Plaza, 7777 Center Avenue, Huntington
Beach, California 92647 ("Bank") and J. DON HARTFELDER, an
individual residing at 3906 Humboldt Drive, Huntington Beach,
California 92649 ("Hartfelder") hereby agree as follows:
RECITALS:
A. Bank wishes to obtain professional, cost effective
inspections for its construction loan projects.
B. Hartfelder, a director of the Bank, is willing to provide
such inspection services to Bank on an independent
contractor basis.
C. As a licensed architect, Hartfelder can provide a high
Level of expertise not generally available to independent
banks. As a director of the Bank, Hartfelder is a known,
stable entity with a major vested interest in the total
success of Bank's construction loan projects.
AGREEMENT
1. Services To Be Provided. Hartfelder shall provide the
Bank with construction loan inspection services.
Hartfelder's duties shall conform to the standard
duties generally required from construction inspectors
by the banking industry, including but not limited to
field inspections, office consultations, professional
evaluations, and preparation of reports. In addition,
Hartfelder shall spend an estimated average of two and
a half (2 1/2 ) days as needed, per week reviewing and
approving vouchers.
2. Independent Contractor Status. Hartfelder's
relationship to Bank shall be that of an independent
contractor. Hartfelder shall not be considered as
having an employee status and shall not, by virtue of
this Agreement, participate in any plan, arrangements
or distributions by Bank pertaining to or in
connection with its employees, including, but not
limited to, any health insurance, workman's
compensation, pension, stock, bonus, profit sharing or
similar benefits, but not including benefits resulting
from his relationship as a director of the Bank.
Hartfelder shall be responsible for all reports and
obligations with respect to his own Social Security,
income tax withholding, unemployment compensation, and
similar matters.
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As an independent contractor, Hartfelder shall have the
sole authority to control and direct the performance of his
services, subject to the performance criteria outlined by
Bank. All services shall be subject to Bank's general
right of review to assure their satisfactory completion.
Hartfelder shall have no authority to enter into written or
oral contracts on behalf of Bank.
Nothing in this Agreement shall be construed as creating a
partnership, joint venture or agency relationship between
Hartfelder and Bank.
3. All Services Are To Be Performed At Bank's Discretion.
All work performed by Hartfelder shall be performed
upon Bank's request and at Bank's sole discretion.
Bank may hired additional construction inspectors from
time to time, and nothing in this Agreement shall be
construed as guaranteeing a minimum work assignment to
Hartfelder. Although it is estimated that Hartfelder
will perform an average of sixty (60) inspections per
month, together with two (2) half days per week
reviewing and approving vouchers, the actual work
performed by Hartfelder may increase or decrease at
Bank's discretion.
4. Hartfelder May Perform Inspection Services For Others.
It is specifically understood and agreed that
Hartfelder may perform construction inspection
services for clients other than Bank, and that the
performance of such services shall not be subject to
the terms of this Agreement, but shall instead be
subject only to the terms of the Agreement between
Hartfelder and such other clients.
5. Compensation For Services. The first ten (10) inspections
per calendar month shall be compensated at $100 per
inspection. The following thirty (30) inspections shall be
compensated at $75 per inspection. Any additional
inspections per calendar month shall be compensated at $50
per inspection.
For inspection of a project located outside a 60 mile
radius of Liberty National Bank, Mr. Hartfelder shall be
paid $.28 per mile for travel to and from the project
beyond the 60 mile radius.
Hartfelder shall be compensated for his services in
reviewing and approving vouchers on the basis of an
equivalent of one (1) inspection for every four hours spent
in performing such administrative work.
Compensation shall be payable to Hartfelder on a monthly
basis, upon receipt of invoice.
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6. Express Limitation On Compensation. Notwithstanding
anything to the contrary in paragraph 5 above, it is hereby
expressly agreed that in no event shall Hartfelder's
monthly compensation, divided by the total number of
inspections allocated to Hartfelder, exceed the average
expenses per inspection experienced by other similar
independent banks in Bank's trade areas, as researched and
updated from time to time. Bank's mode of computing such
"average expense", including its selection of at least
three (3) "similar independent banks" for sampling
purposes, shall be at the Bank's sole discretion.
7. Indemnification. Hartfelder agrees to indemnify, defend
and hold Bank harmless from and against any and all claims,
demands, actions, suits, losses and/or damages arising out
of (a) Hartfelder's unlawful or negligent acts or omissions
in connection with this Agreement; (b) Hartfelder's
performance of services for clients other than Bank' and
injuries allegedly suffered by Hartfelder while performing
the services contemplated by this Agreement.
Bank agrees to indemnify, defend and hold Hartfelder
harmless from and against any and all claims, demands,
suits, losses and/or damages arising out of (a) Bank's
unlawful or negligent acts or omissions in connection with
this Agreement; (b) the negligence or unlawful conduct of
Bank, its employees, representatives or agents; and
injuries allegedly suffered by Bank, its employees,
representatives, agents and/or subcontractors.
This indemnification provision shall be independent of any
other indemnification agreement between Hartfelder and
Bank.
8. Insurance. Hartfelder shall maintain the following
insurance in amounts satisfactory to Bank:
Errors & Omissions Insurance Policy in the minimum amount
of $250,000 to be maintained.
9. Term. Unless terminated earlier as set forth below in
paragraph 10, the initial term of this Agreement shall be
one year. At the end of the initial term, the parties may
negotiate an additional term or terms, on such terms and
conditions as the parties may mutually agree upon at that
time.
10. Termination By Either Party. This Agreement may be
canceled with or without cause, by either party
hereto. Said cancellation shall be effective 30 days
after written notice of such intent to cancel is
delivered to the other party.
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11. Compliance With The Law. Hartfelder and Bank agree to
comply with all applicable laws and government
regulations. No instruction by either party shall be
construed in a way that would require the other party
to violate any law or regulation.
12. No Assignment. Neither Hartfelder nor Bank may assign
or subcontract any right or duty associated with this
Agreement without the prior written consent of the
other.
13. Waivers. Either party may delay enforcing its rights
under this Agreement without losing them. Any waiver
of a right by either party must be in writing and
shall not be deemed to be a waiver of other rights or
of the same right at another time.
14. Arbitration. Any controversy or claim arising out of or
related to this agreement, or the breach thereof, shall be
settled by arbitration in accordance with the Rules of the
American Arbitration, and judgement upon the award rendered
by the arbitrator may be entered in any court having
jurisdiction thereof. Provisional relief may, but need
not, be sought in a court of law while arbitration
proceedings are pending, and any relief granted by such
court shall remain effective until the matter is finally
resolved through arbitration. Final resolution through
arbitration may include any remedy or relief that the
arbitrator deems just and equitable, including permanent
injunctive relief or specific performance relief, or both,
and the arbitrator is specifically empowered to award such
relief, which shall then become a court judgement. Venue
and jurisdiction for any arbitration or legal action
regarding this Agreement shall be the State of California.
15. Amendment. This Agreement may be amended only by a written
document signed by both parties.
16. California Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of
California.
17. Entire Agreement. This Agreement contains all of the
promises, covenants, undertakings and obligations of the
parties concerning the subject of this Agreement and
neither party is relying upon any statement, promise or
agreement, except as set forth in this Agreement. All work
in progress at the time this Agreement is executed shall be
governed by the terms of this Agreement.
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18. Notices. Any notices required by this Agreement shall be
sent to the other party at the address set forth above, or
at such other address as the party may request in writing
from time to time.
Dated: , 1996
/s/ J. Don Hartfelder
--------------------------------
J. Don Hartfelder, an individual
LIBERTY NATIONAL BANK
By: /s/ Philip S. Inglee
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Philip S. Inglee
Title: President & Chief Executive Officer