Exhibit 10.1
AGREEMENT
AGREEMENT, dated this 1ST day of October 1998, between WVS Financial
Corp. (the "Corporation"), a Pennsylvania-chartered corporation, West View
Savings Bank (the "Savings Bank"), a Pennsylvania-chartered savings bank and a
wholly-owned subsidiary of the Corporation, and David J. Bursic (the
"Executive").
WITNESSETH
WHEREAS, the Executive is presently an officer of the Corporation
and/or the Savings Bank (together the "Employers"); and
WHEREAS, the Employers desire to be ensured of the Executive's
continued active participation in the business of the Employers; and
WHEREAS, in order to induce the Executive to remain in the employ of
the Employers and in consideration of the Executive's agreeing to remain in the
employ of the Employers, the parties desire to specify the severance benefits
which shall be due the Executive in the event that his employment with the
Employers is terminated under specified circumstances;
NOW THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereby agree as follows:
1. Definitions. The following words and terms shall have the meanings
set forth below for the purposes of this Agreement:
(a) Base Salary. "Base Salary" shall have the meaning set forth in
Section 3(a) hereof.
(b) Cause. Termination of the Executive's employment for "Cause" shall
mean termination because of personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses) or final
cease-and-desist order or material breach of any provision of the Agreement. For
purposes of this paragraph, no act or failure to act on the Executive's part
shall be considered "willful" unless done, or omitted to be done, by the
Executive not in good faith and without reasonable belief that the Executive's
action or omission was in the best interest of the Employers.
(c) Change in Control of the Corporation. "Change in Control of the
Corporation" shall mean a change in control of a nature that would be required
to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934, as amended ("Exchange
Act") or any successor thereto, whether or not the Corporation is registered
under Exchange Act; provided that, without limitation, such a change in control
shall be deemed to have occurred if (i) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing 25% or more of the
combined voting power of the Corporation's then outstanding securities; or (ii)
during any period of two consecutive years, individuals who at the beginning of
such period constitute the Board of Directors of the Corporation cease for any
reason to constitute at least a majority thereof unless the election, or the
nomination for election by stockholders, of each new director was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period.
(d) Code. "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(e) Date of Termination. "Date of Termination" shall mean (i) if the
Executive's employment is terminated for Cause or for Disability, the date
specified in the Notice of Termination, and (ii) if the Executive's employment
is terminated for any other reason, the date on which a Notice of Termination is
given or as specified in such Notice.
(f) Disability. Termination by the Employers of the Executive's
employment based on "Disability" shall mean termination because of any physical
or mental impairment which qualifies the Executive for disability benefits under
the applicable long-term disability plan maintained by the Employers or any
subsidiary or, if no such plan applies, which would qualify the Executive for
disability benefits under the Federal Social Security System.
(g) Good Reason. Termination by the Executive of the Executive's
employment for "Good Reason" shall mean termination by the Executive following a
Change in Control of the Corporation based on:
(i) Without the Executive's express written consent, the
failure to elect or to re-elect or to appoint or to
re-appoint the Executive to the offices of President
and Chief Executive Officer of the Employers or a
material adverse change made by the Employers in the
Executive's functions, duties or responsibilities as
President and Chief Executive Officer of the
Employers immediately prior to a Change in Control of
the Corporation;
(ii) Without the Executive's express written consent, a
reduction by the Employers in the Executive's Base
Salary as the same may be increased from time to time
or, except to the extent permitted by Section 3(b)
hereof, a reduction in the package of fringe benefits
provided to the Executive, taken as a whole;
(iii) The principal executive office of the Employers is
relocated outside of the Pittsburgh, Pennsylvania
area or, without the Executive's express written
consent, the Employers require the Executive to be
based anywhere other than an area in which the
Employers' principal executive office is located,
except for required travel on business of the
Employers to an extent substantially consistent with
the Executive's present business travel obligations;
(iv) Any purported termination of the Executive's
employment for Cause, Disability or Retirement which
is not effected pursuant to a Notice of Termination
satisfying the requirements of paragraph (j) below;
or
(v) The failure by the Employers to obtain the assumption
of and agreement to perform this Agreement by any
successor as contemplated in Section 9 hereof.
(h) IRS. IRS shall mean the Internal Revenue Service.
(i) Notice of Termination. Any purported termination of the Executive's
employment by the Employers for any reason, including without limitation for
Cause, Disability, or Retirement or by the Executive for any reason, including
without limitation for Good Reason, shall be communicated by written "Notice of
Termination" to the other party hereto. 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 Executive's employment under the provision so indicated, (iii)
specifies a Date of Termination, which shall be not less than thirty (30) nor
more than ninety (90) days after such Notice of Termination is given, except in
the case of the Employers termination of Executive's employment for Cause; and
(iv) is given in the manner specified in Section 10 hereof.
(j) Parachute Payment. The term "Parachute Payment" has the meaning as
set forth in Section 280G of the Code and applicable Treasury regulations
(without regard to Section 280(b)(2)(A)(ii) of the Code and the Treasury
regulations thereunder).
(k) Retirement. Termination by the Employers of the Executive's
employment based on "Retirement" shall mean voluntary termination by the
Employee in accordance with the Employers' retirement policies, including early
retirement, generally applicable to their salaried employees.
2. Term of Employment.
(a) The Employers hereby employ the Executive as President and Chief
Executive Officer and Executive hereby accepts said employment and agrees to
render such services to the Employers on the terms and conditions set forth in
this Agreement. The term of employment under this Agreement shall be for three
years, commencing on the date of this Agreement and, subject to the requirements
of the succeeding sentence, shall be deemed automatically, without further
action, beginning on the day following the date of this Agreement and on each
day thereafter, to extend for a period of one day in addition to the
then-remaining term, such that at any time the remaining term of this Agreement
shall be three years. Prior to the first annual anniversary of the date of this
Agreement and each annual anniversary thereafter, the Board of Directors of the
Employers shall consider and review (with appropriate corporate documentation
thereof, and after taking into account all relevant factors, including the
Executive's performance hereunder) extension of the term under this Agreement,
and the term shall continue to extend in the manner set forth above unless
either the Board of Directors does not approve such extension and provides
written notice to the Executive of such event or the Executive gives written
notice to the Employers of the Executive's election not to extend the term, in
each case with such written notice to be given not less than thirty (30) days
prior to any such anniversary date. References herein to the term of this
Agreement shall refer both to the initial term and successive terms.
(b) During the term of this Agreement, the Executive shall perform such
executive services for the Employers as may be consistent with his titles and
from time to time assigned to him by the Employers' Board of Directors.
3. Compensation and Benefits.
(a) The Employers shall compensate and pay Executive for his services
during the term of this Agreement at a minimum base salary of $120,000 per year
("Base Salary"), which may be increased from time to time in such amounts as may
be determined by the Board of Directors of the Employers and may not be
decreased without the Executive's express written consent. In addition to his
Base Salary, the Executive shall be entitled to receive during the term of this
Agreement such bonus payments as may be determined by the Board of Directors of
the Employers.
(b) As President and Chief Executive Officer, Executive shall be
entitled to participate in and receive the benefits of any pension or other
retirement benefit plan, profit sharing, stock option, employee stock ownership,
or other plans, benefits and privileges given to employees and executives of the
Employers, to the extent commensurate with his then duties and responsibilities,
as fixed by the Board of Directors of the Employers. The Employers shall not
make any changes in such plans, benefits or privileges which would adversely
affect Executive's rights or benefits thereunder, unless such change occurs
pursuant to a program applicable to all executive officers of the Employers and
does not result in a proportionately greater adverse change in the rights of or
benefits to Executive as compared with any other executive officer of the
Employers. Nothing paid to Executive 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 Executive pursuant to Section 3(a) hereof.
(c) During the term of this Agreement, Executive shall be entitled to
paid annual vacation in accordance with the policies as established from time to
time by the Board of Directors of the Employers, which shall in no event be less
than four weeks per annum. Executive shall not be entitled to receive any
additional compensation from the Employers for failure to take a vacation, nor
shall Executive be able to accumulate unused vacation time from one year to the
next, except to the extent authorized by the Board of Directors of the
Employers.
4. Expenses. The Employers shall reimburse Executive or otherwise
provide for or pay for all reasonable expenses incurred by Executive in
furtherance of, or in connection with the business of the Employers, including,
but not by way of limitation, automobile and traveling expenses, and all
reasonable entertainment expenses (whether incurred at the Executive's
residence, while traveling or otherwise), subject to such reasonable
documentation and other limitations as may be established by the Board of
Directors of the Employers. If such expenses are paid in the first instance by
Executive, the Employers shall reimburse the Executive therefor.
5. Termination.
(a) The Employers shall have the right, at any time upon prior Notice
of Termination, to terminate the Executive's employment hereunder for any
reason, including without limitation termination for Cause, Disability or
Retirement, and Executive shall have the right, upon prior Notice of
Termination, to terminate his employment hereunder for any reason.
(b) In the event (i) Executive's employment is terminated by the
Employers for Cause, Disability or Retirement or in the event of the Executive's
death, or (ii) Executive terminates his employment hereunder other than for Good
Reason, Executive shall have no right pursuant to this Agreement to compensation
or other benefits for any period after the applicable Date of Termination.
(c) (i) In the event that (i) Executive's employment is terminated
by the Employers for other than Cause, Disability, Retirement
or the Executive's death or (ii) such employment is terminated
by the Executive (a) due to a material breach of this
Agreement by the Employers, which breach has not been cured
within fifteen (15) days after a written notice of
non-compliance has been given by the Executive to the
Employers, or (b) for Good Reason, and prior to the
Executive's Date of Termination there has been a Change in
Control of the Corporation or a written agreement which
contemplates a Change in Control of the Corporation and which
still is in effect has been entered into by the Corporation,
then the Employers shall, subject to the provisions of Section
6 hereof, if applicable
(A) pay to the Executive, in thirty-six (36) equal
monthly installments beginning with the first
business day of the month following the Date of
Termination, a cash severance amount equal to three
(3) times the Executive's Base Salary, and
(B) maintain and provide for a period ending at the
earlier of (i) the expiration of the remaining term
of employment pursuant hereto prior to the Notice of
Termination or (ii) the date of the Executive's
full-time employment by another employer (provided
that the Executive is entitled under the terms of
such employment to benefits substantially similar to
those described in this subparagraph (B)), at no cost
to the Executive, the Executive's continued
participation in all group insurance, life insurance,
health and accident, disability and other employee
benefit plans, programs and arrangements in which the
Executive was entitled to participate immediately
prior to the Date of Termination (other than stock
option and restricted stock plans of the Employers),
provided that in the event that the Executive's
participation in any plan, program or arrangement as
provided in this subparagraph (B) is barred, or
during such period any such plan, program or
arrangement is discontinued or the benefits
thereunder are materially reduced, the Employers
shall arrange to provide the Executive with benefits
substantially similar to those which the Executive
was entitled to receive under such plans, programs
and arrangements immediately prior to the Date of
Termination.
(ii) In the event that (i) Executive's employment is terminated by
the Corporation for other than Cause, Disability, Retirement
or the Executive's death or (ii) such employment is terminated
by the Executive due to a material breach of this Agreement by
the Employer, which has not been cured within fifteen (15)
days after a written notice of non-compliance has been given
by the Executive to the Employers, and as of the Executive's
Date of Termination no Change of Control of the Corporation
has occurred and no written agreement which contemplates a
Change in Control of the Corporation and which still is in
effect has been entered into by the Corporation, then the
Corporation shall, subject to provisions of Section 6 hereof,
if applicable:
(A) pay to the Executive, in eighteen (18) equal monthly
installments beginning with the first business day of the
month following the Date of Termination, a cash severance
amount equal to two (2) times the Executive's Base Salary,
and
(B) the expiration of eighteen (18) months from the
Executive's Date of Termination or (ii) the date of the
Executive's full-time employment by another employer
(provided that the Executive is entitled under the terms
of such employment to benefits substantially similar to
those described in this subparagraph (B)), at no cost
maintain and provide for a period ending at the earlier of
(i) to the Executive, the Executive's continued
participation in all group health insurance plans offered
by the Corporation in which the Executive was entitled to
participate immediately prior to the Date of Termination.
The Executive shall not be entitled to participate in any
other employee benefit plan, program or arrangement of the
Employers subsequent to his Date of Termination.
(d) If the Executive becomes liable, in any taxable year, for the
payment of an excise tax under Section 4999 of the Code on account of any
payments to the Executive pursuant to this Section 5, and the Employers chose
not to contest the liability or have exhausted all administrative and judicial
appeals contesting the liability, the Employers shall pay the Executive (i) an
amount equal to the excise tax for which the Executive is liable under Section
4999 of the Code, (ii) the federal, state, and local income taxes, and interest
if any, for which the Executive is liable on account of the payments pursuant to
item (i), and (ii) any additional excise tax under Section 4999 of the Code and
any federal, state and local income taxes, for which the Executive is liable on
account of payments made pursuant to items (i) and (ii).
(e) This subsection 5(e) applies if the amount of payments to the
Executive under subsection 5(d) has not been determined with finality by the
exhaustion of administrative and judicial appeals. In such circumstances, the
Employers and the Executive shall, as soon as practicable after the event or
series of events has occurred giving rise to the imposition of the excise tax,
cooperate in determining the amount of the Executive's excise tax liability for
purposes of paying the estimated tax. The Executive shall thereafter furnish to
the Employers or their successors a copy of each tax return which reflects a
liability for an excise tax under Section 4999 of the Code at least 20 days
before the date on which such return is required to be filed with the IRS. The
liability reflected on such return shall be dispositive for the purposes hereof
unless, within 15 days after such notice is given, the Employers furnish the
Executive with a letter of the auditors or tax advisor selected by the Employers
indicating a different liability or that the matter is not free from doubt under
the applicable laws and regulations and the Executive may, in such auditor's or
advisor's opinion, cogently take a different position, which shall be set forth
in the letter with respect to the payments in question. Such letter shall be
addressed to the Executive and state that he is entitled to rely thereon. If the
Employers furnish such a letter to the Executive, the position reflected in such
letter shall be dispositive for purposes of this Agreement, except as provided
in subsection 5(f) below.
(f) Notwithstanding anything in this Agreement to the contrary, if the
Executive's liability for the excise tax under Section 4999 of the Code for a
taxable year is subsequently determined to be less than the amount paid by the
Employers pursuant to subsection 5(e), the Executive shall repay the Employers
at the time that the amount of such excise tax liability is finally determined,
the portion of such income and excise tax payments attributable to the reduction
(plus interest on the amount of such repayment at the rate provided on Section
1274(b)(2)(B) of the Code and if the Executive's liability for the excise tax
under Section 4999 of the Code for a taxable year is subsequently determined to
exceed the amount paid by the Employers pursuant to Section 5, the Employers
shall make an additional payment of income and excise taxes in the amount of
such excess, as well as the amount of any penalty and interest assessed with
respect thereto at the time that the amount of such excess and any penalty and
interest is finally determined.
6. Mitigation; Exclusivity of Benefits.
(a) The Executive shall not be required to mitigate the amount of any
benefits hereunder by seeking other employment or otherwise, nor shall the
amount of any such benefits be reduced by any compensation earned by the
Executive as a result of employment by another employer after the Date of
Termination or otherwise.
(b) The specific arrangements referred to herein are not intended to
exclude any other benefits which may be available to the Executive upon a
termination of employment with the Employers pursuant to employee benefit plans
of the Employers or otherwise.
7. Withholding. All payments required to be made by the Employers
hereunder to the Executive shall be subject to the withholding of such amounts,
if any, relating to tax and other payroll deductions as the Employers may
reasonably determine should be withheld pursuant to any applicable law or
regulation.
8. Assignability. The Employers may assign this Agreement and its
rights and obligations hereunder in whole, but not in part, to any corporation,
bank or other entity with or into which the Employers may hereafter merge or
consolidate or to which the Employers may transfer all or substantially all of
its assets, if in any such case said corporation, bank or other entity shall by
operation of law or expressly in writing assume all obligations of the Employers
hereunder as fully as if it had been originally made a party hereto, but may not
otherwise assign this Agreement or its rights and obligations hereunder. The
Executive may not assign or transfer this Agreement or any rights or obligations
hereunder.
9. Notice. For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by certified or
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth below:
To the Employers: WVS Financial Corp.
West View Savings Bank
9001 Perry Highway
Pittsburgh, Pennsylvania 15237
To the Executive: David J. Bursic
304 Wagon Wheel Trail
Wexford, Pennsylvania 15090
10. Amendment; Waiver. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and such officer or officers as may be
specifically designated by the Board of Directors of the Employers to sign on
its behalf. No waiver by any party hereto at any time of any breach by any other
party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time.
11. Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the United States
where applicable and otherwise by the substantive laws of the Commonwealth of
Pennsylvania.
12. Nature of Obligations. Nothing contained herein shall create or
require the Employers to create a trust of any kind to fund any benefits which
may be payable hereunder, and to the extent that the Executive acquires a right
to receive benefits from the Employers hereunder, such right shall be no greater
than the right of any unsecured general creditor of the Employers.
13. 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.
14. Validity. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provisions of this Agreement, which shall remain in full force and effect.
15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
16. Regulatory Prohibition. Notwithstanding any other provision of this
Agreement to the contrary, any payments made to the Executive pursuant to this
Agreement, or otherwise, are subject to and conditioned upon their compliance
with Section 18(k) of the FDIA (12 U.S.C.ss.1828(k)) and any regulations
promulgated thereunder.
IN WITNESS WHEREOF, this Agreement has been executed as of the date
first above written.
Attest: WVS FINANCIAL CORP. INC.
/s/William J. Hoegel By: /s/James S. McKain, Jr.
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James S. McKain, Jr.
Chairman of the Board
Attest: West View Savings Bank
/s/William J. Hoegel By: /s/James S. McKain, Jr.
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James S. McKain, Jr.
Chairman of the Board
By: /s/David J. Bursic
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David J. Bursic