EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into this ___ day of August, 1995 by and between
SARATOGA NATIONAL BANK, a National Banking Association (the Employer) and
RICHARD L. MOUNT (the Employee) and is effective as of January 1, 1995.
WHEREAS, Employer and Employee desire to enter into an agreement to engage
the services of Employee by reason of his experience, training, and ability
in the commercial banking industry;
NOW, THEREFORE, it is mutually agreed as follows:
1. Employment and Duties. Employer hereby employs Employee and Employee
hereby accepts employment with Employer as President and Chief Executive
Officer of Employer. He shall perform such duties as are customary to the
office, and such as may from time to time be reasonably requested of him by
the Board of Directors of Employer.
2. Extent of Services. Employee shall devote his full time, attention and
energies to the business of Employer and shall not during the term of this
Agreement be engaged in any other business activities, except passive personal
investments, without the prior written consent of Employer.
3. Term. The term of this Agreement shall be one (1) year from the effective
date hereof, subject to the termination provisions set forth herein.
4. Base Salary. In consideration for services rendered under this Agreement,
Employer shall pay to Employee a base salary of One Hundred Thirty-Five
Thousand Dollars ($135,000.00), payable in equal installments of
Five Thousand Six Hundred Twenty-Five Dollars ($5,625.00) on the first and
fifteenth of each month during the term of this Agreement, prorated for any
partial employment period.
5. Incentive Compensation. In addition to Employees base salary as
described in paragraph 4, Employee shall be entitled to receive incentive
compensation in such amounts and at such times during the term of this
Agreement as is set forth in the Chief Executive Officer Incentive
Compensation Plan, which is marked Exhibit A and incorporated herein by
reference. Notwithstanding the provisions of said Plan, Employee shall
not be entitled to receive as incentive compensation (cash award and
deferred award combined) an amount which exceeds the amount of his base
salary.
6. Director Fees. Employee shall be entitled to receive Director Fees for
his service on the Board of Directors of Employer, in the same amount as
that paid to other Directors. Said Director Fees shall not be considered
part of Employees base salary.
7. Expenses. Employer shall pay, or Employee shall be reimbursed for all
ordinary and necessary expenses incurred by Employee in connection with his
employment. Employer shall also pay, or Employee shall be reimbursed for
expenses incurred in activities associated with promoting the business of
Employer that are authorized from time to time by the Board of Directors
of Employer,
including expenses of club membership, entertainment, travel,
attendance at seminars and conventions and similar items.
8. Automobile. Employer shall provide Employee with an automobile for
Employees personal and business use during the term of this Agreement, or
until this Agreement is terminated as provided herein. Said automobile
shall be selected mutually by Employer and Employee. Employer also agrees
to procure and maintain automobile liability insurance on such automobile.
All automobile expenses incurred by Employee in performing his duties
hereunder are to be paid by Employer or reimbursed to Employee.
9. Vacation. Employee shall be entitled to five (5) weeks annual vacation
leave at full pay. The timing of such vacation leave shall be at the
discretion of the Employee, so long as it does not jeopardize his
responsibilities to Employer. Any unused vacation leave shall expire at
the end of the calendar year.
10. Sabbatical Leave. Employee is entitled to six weeks of sabbatical
leave, to be taken in accordance with the terms of the resolution adopted
on August 9, 1988 by Employers Board of Directors.
11. Disability. If Employee becomes disabled during the term of this
Agreement because of physical or mental disability such that he is unable
to perform his duties hereunder, Employer agrees to continue Employees
salary until the earlier of (i) six (6) months from the first working day
missed due to such physical or mental disability, or (ii) Employees return
to work.
12. Insurance. At all times during the term of this Agreement, Employer
agrees to provide Employee and his dependents, at its sole cost and expense,
such group insurance as it provides its other employees, including health
(medical, dental, and hospitalization), accident, and disability insurance.
In addition Employer shall pay the premium cost for a term life insurance
policy in the face amount of Five Hundred Thousand Dollars ($500,000.00),
insuring Employees life. Employee shall be entitled to designate the
beneficiary of said policy.
13. Printed Material. All written or printed materials used by Employee
in performing duties for Employer, other than Employees personal notes
and diaries, are and shall remain the property of Employer. Upon
termination of employment, Employee shall return such written or printed
materials to Employer.
14. Disclosure of Information. Employee shall not, either before or after
termination of this Agreement, disclose to anyone any information relating
to Employer or any financial information, trade secrets, customer lists,
computer software or other information not otherwise publicly available
concerning the business and operations of Employer. Employee recognizes
and acknowledges that any financial information concerning any of Employers
customers, as it may exist from time to time, is strictly confidential and
is a valuable, special and unique asset of Employers business. Employee
shall not, either before or after termination of this Agreement, disclose
to anyone said
financial information or any part thereof, for any reason
or purpose whatsover.
15. Noncompetition by Employee. During the term of this Agreement, Employee
shall not, directly or indirectly, either as an employee, employer,
consultant, agent, principal, stockholder, corporate officer, director, or
in any other individual or representative capacity, engage or participate
in any competitive banking business.
16. Surety Bond. Employee agrees to furnish all information and take any
other steps necessary from time to time to enable Employer to obtain or
maintain a fidelity bond, conditioned on the rendering of a true account
by Employee of all moneys, goods, or other property which may come into the
custody, charge, or possession of Employee during the term of this
Agreement. The surety company issuing the bond and the amount of the bond
must be acceptable to Employer. If Employee cannot qualify for a surety bond
at any time during the term of this Agreement, Employer shall have the option
to terminate this Agreement immediately.
17. Moral Conduct. Employee agrees to conduct himself at all times with
due regard to public conventions and morals. He further agrees not to do
or commit any act that will reasonably tend to shock or offend the
community, or to prejudice Employers reputation in general.
18. Termination of Agreement.
a. Automatic Termination. This Agreement shall terminate immediately
upon the occurrence of any of the following
events, subject to either partys
right, without obligation, to waive an event reasonably susceptible of
waiver, and subject to the obligation of Employer to pay the amounts which
would otherwise be payable to Employee under this Agreement through the end
of the month in which the event occurs, except that in the event of
termination based upon subparagraphs (4), (5), (6), (7), (8), (9), or (12)
below, Employee shall have no rights to payments and Employer shall have no
obligation to make payments to or on behalf of Employee pursuant to this
Agreement:
(1) The death of Employee;
(2) The loss by Employee of legal capacity;
(3) The permanent disability of Employee;
(4) The habitual neglect by Employee of his obligations under this
Agreement;
(5) The wilful breach of duty by Employee in the course of his employment;
(6) The Employees deliberate disregard of any State of California or
federal banking laws, or the Bylaws, rules, policies or resolutions
of the Employer, or the laws, rules or regulations of the Federal
Deposit Insurance Corporation or the Office of the Comptroller of
the Currency, or other regulatory agency having jurisdiction over
Employer;
(7) The determination by a federal banking agency having jurisdiction
over Employer that Employee is not suitable to act in the capacity
for which he is employed by Employer;
(8) Employees conviction of any felony or a crime involving moral
turpitude, or Employees commission of a fraudulent or dishonest act;
(9) Employees disclosure without authority of any secret or confidential
information concerning Employer, or Employees taking any action which
Employers Board of Directors determines, in its sole discretion,
constitutes unfair competition with Employer;
(10) The loss by Employer of legal capacity to contract;
(11) The occurrence of circumstances that make it impossible or
impractical for Employer to conduct or continue its business;
(12) The breach by either party of the terms of this Agreement; or
(13) The occurrence of a change in control of Employer, as defined in
paragraph 1 of the Management Continuity Agreement, a copy of which
is marked Exhibit B.
b. Termination by Employer. Employer may, at its option, terminate this
Agreement for any reason not specified in paragraph 18.a., or for no
reason, by giving not less than thirty (30) days prior written notice
of termination to Employee, without prejudice to any other remedy to
which Employer may be entitled either at law, in equity, or under this
Agreement. Upon such termination, Employee shall be entitled to
receive any employment
benefits which shall have accrued prior to such termination, including
without limitation, incentive compensation in accordance with
paragraph 5 hereof, and the severance compensation specified in
paragraph 18.d. below.
c. Termination by Employee. This Agreement may be terminated by Employee
for any reason not specified in paragraph 18.a., or no reason, by giving
not less than thirty (30) days prior written notice of termination to
Employer. Upon such termination, all rights and obligations accruing to
Employee under this Agreement shall cease, except that such termination
shall not prejudice Employees rights regarding employment benefits which
shall have accrued prior to such termination, including, without limitation
incentice compensation in accordance with paragraph 5 hereof, and any other
remedy which Employee may have at law, in equity or under this agreement,
which remedy accrued prior to such termination.
d. Severance Pay Upon Termination Without Change in Control. In the event
of termination by Employer at any time pursuant to paragraph 18.b. of this
Agreement, Employee shall be entitled to severance pay at Employees rate of
pay immediately preceding such termination equal to six (6) months salary,
payable in a lump sum or monthly installments at the election of Employee;
and he shall also be paid any incentive compensation for the year in which
termination occurs, prorated to the date of termination. Such severance
pay is in lieu of all damages, payments and liabilities due to Employee on
account of the early termination of this agreement.
e. Severance Pay Upon Termination Following Change in Control. Employer
and Employee acknowledge and agree that on July 9, 1990 they entered into
a Management Continuity Agreement, a copy of which is marked Exhibit B,
which agreement is still in full force and effect. Said agreement provides
Employee a severance benefit in the event of his termination following a
change in control of Employer, as defined therein.
19. Notices. Any notices to be given hereunder by either party to the
other may be effected either by personal delivery in writing or by U.S.
mail, registered or certified, prepaid with return receipt requested.
Mailed notice to Employer shall be given to Saratoga National Bank, 12000
Saratoga-Sunnyvale Road, Saratoga, CA 95070, Attention: William D. Kron,
Chairman of the Board. Mailed notice to Employee shall be given to Richard
L. Mount, 20564 Verde Court, Saratoga, CA 95070.
20. Entire Agreement. Except as set forth in this paragraph 19, this
Agreement supersedes any and all other agreements, either oral or written,
between the parties hereto with respect to the employment of Employee by
Employer, and it, together with Exhibits A and B hereto, contains all of
the covenants and agreements between the parties with respect to such
employment. Each party to this Agreement acknowledges that no
representations, inducements, promises, or agreements, have been made by
any party, or by anyone acting on behalf of any party, which are not embodied
herein, and that no other agreement, statement, or promise not contained
in this Agreement shall be valid and binding. Any modification of this
Agreement shall be effective only if it is in writing and signed by the
party to be charged.
21. Partial Invalidity. If any provision of this Agreement is held by a
court of competent jurisdiction to be invalid, void, or unenforceable, the
remaining provisions shall nevertheless continue in full force without
being impaired or invalidated in any way.
22. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, and venue for any
action or proceeding to enforce or interpret any provision of this Agreement
shall be in Santa Clara County, California.
23. Waiver. The parties hereto shall not be deemed to have waived any of
their respective rights under this Agreement, unless the waiver is in
writing and signed by such waiving party. No delay in exercising any right
shall be a waiver of the right, nor shall a waiver on one occasion operate
as a waiver of such right on a future occasion.
24. Payment of Money Due Deceased Employee. If Employee dies prior to the
expiration of the term of this Agreement, any money that may be due Employee
from Employer under this Agreement as of the date of Employees death shall
be paid to Employees personal representative, successor or assigns.
25. Attorneys Fees. Should either party hereto institute legal proceedings
to enforce or interpret any provision hereof, the prevailing party shall be
entitled to recover from the other party reasonable attorneys fees and
costs of suit.
IN WITNESS WHEREOF, this Agreement is executed in duplicate originals at
Saratoga, California, as of the date first above written.
EMPLOYER: SARATOGA NATIONAL BANK
By: _______________________
WILLIAM D. KRON
Chairman of the Board
By: _______________________
NEAL A. CABRINHA
Secretary
EMPLOYEE: ___________________________
RICHARD L. MOUNT
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