EXHIBIT 10 - LONG TERM CARE BENEFIT AGREEMENT
This Long Term Care Benefit Agreement (this "Agreement") is entered
into as of ___________, 2001, by and between Bank of Lodi, N.A., a national
banking association (the "Company") and ______________ ("Participant").
RECITALS
Participant is [an executive employee] [a director] of the Company and
is a valuable member of the Company's management. The Company desires to retain
Participant' services and is willing to enter into this Agreement as a means of
provided additional benefits to Participant.
Therefore, in consideration of the services to be performed by
Participant in the future, as well as the mutual promises and covenants
contained herein, the Company and Participant agree as follows:
AGREEMENT
1. Long Term Care Insurance
Unless and until the Company's obligation is terminated under Section 2
or Section 4 of this Agreement, the Company shall pay the premiums due under the
following long term care insurance policy for the benefit of Participant (the
"Policy"):
Insurer: ______________________________
Policy Number: ______________________________
Participant acknowledges that he has received a copy of the Policy.
2. Termination of Company's Obligation
If Participant ceases to be [an employee] [a director] of the Company
for any reason other than Participant's Retirement or a Change in Control of the
Company prior to the time that all premiums due under the Policy have been paid,
the Company's obligation to pay the premiums due under the Policy shall
immediately terminate. In the event of such termination, the Company agrees that
it will reasonably cooperate with Participant to enable Participant to assume
the obligation to pay the premiums and to keep the Policy in force, provided
that (i) the Company shall not be obligated to incur any additional expense or
liability in connection with such assumption and (ii) Participant shall
reimburse the Company for any premium paid by the Company to the extent such
premium is attributable to a period of time subsequent to Participant's
termination. For purposes of the preceding clause (ii), premiums shall be deemed
to be paid in advance and premiums shall be allocated equally to each day of the
time between premium due dates. If Participant remains as [an employee] [a
director] of the Company until all premiums due under the Policy have been paid,
Participant's rights under the Policy shall be fully vested and nonforfeitable.
For purposes of this Agreement:
"Retirement" shall mean Participant's ceasing to serve as [an executive
officer] [a director] of the Company on or after Participant's [62nd] [75th]
birthday; and
"Change in Control" shall mean the occurrence of any of the following
events with respect to the Company (with the term "Company" being defined for
purposes of determining whether a "Change in Control" has occurred to include
its parent holding company): (i) 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 (the
"Exchange Act"), or in response to any other form or report to the regulatory
agencies or governmental authorities having jurisdiction over the Company or any
stock exchange on which the Company's shares are listed which requires the
reporting of a change in control; (ii) any merger, consolidation or
reorganization of the Company in which the Company does not survive; (iii) any
sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one
transaction or a series of transactions) of any assets of the Company having an
aggregate fair market value of fifty percent (50%) of the total value of the
assets of the
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Company, reflected in the most recent balance sheet of the Company; (iv) a
transaction whereby any "person" (as such term is used in the Exchange Act) or
any individual, corporation, partnership, trust or any other entity becomes the
beneficial owner, directly or indirectly, of securities of the Company
representing twenty-five percent (25%) or more of the combined voting power of
the Company's then outstanding securities; or (v) a situation where, in any
one-year period, individuals who at the beginning of such period constitute the
Board of Directors of the Company cease for any reason to constitute at least a
majority thereof, unless the election, or the nomination for election by the
Company's shareholders, of each new Director is approved by a vote of at least
three-quarters (3/4) of the Directors then still in office who were Directors at
the beginning of the period. Notwithstanding the foregoing or anything else
contained herein to the contrary, there shall not be a "Change of Control" for
the purposes of this Agreement if the event which would otherwise come within
the meaning of the term "Change of Control" involves (i) a reorganization at the
direction of the Company solely to form a parent bank holding company which owns
one hundred percent (100%) of the Company's common stock following the
reorganization, or (ii) an Employee Stock Ownership Plan sponsored by the
Company or its parent holding company which is the party that acquires "control"
or is the principal participant in the transaction constituting a "Change in
Control," as described above.
3. Limitation of Company's Obligation
The Company's obligation under this Agreement shall be limited to the
payment of premiums due under the Policy, in accordance with the terms and
conditions of this Agreement. The Company shall have no responsibility for
payment of any benefits under the Policy. The Company makes no representations
or warranties regarding any benefits to be paid under the Policy, the
eligibility of Participant to receive any such benefits, or the ability of the
Insurer to pay any such benefits now or in the future.
4. Income Tax Consequences
The Company shall not be responsible for providing Participant with tax
advice with respect to this Agreement or the transactions contemplated by this
Agreement. Any tax liabilities incurred by Participant as a result of the
transactions contemplated by this Agreement shall be the sole responsibility of
Participant. The Company shall have the right to withhold from amounts due
Participant, or to collect from Participant, any amount which the Company deems
necessary to satisfy any taxes required by law to be withheld at any time by the
Company, and the obligations of the Company under this Agreement shall be
conditional upon payment of such taxes.
5. No Contract of Employment
Although this Agreement is intended to provide Participant with an
additional incentive to remain as [an employee] [a director] of the Company,
this Agreement shall not be deemed to constitute a contract of employment
between the Company and Participant. This Agreement shall have no impact or
effect upon any separate written employment agreement which the Participant may
have with the Company.
6. Section 280G Adjustment
If all or any portion of the amounts payable by the Company pursuant to
this Agreement, alone or together with other payments which Participant has the
right to receive from the Company and/or its parent holding company, constitute
"excess parachute payments" within the meaning of Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), that are subject to the excise
tax imposed by Section 4999 of the Code (or similar tax and/or assessment), such
amounts payable to Participant shall be reduced to the extent necessary, in the
Company's reasonable judgment, to eliminate any excise tax pursuant to Section
4999 of the Code.
7. Status as Unsecured General Creditor
Notwithstanding anything contained herein to the contrary: (i)
Participant shall have no legal or equitable rights, interests or claims in or
to any specific property or assets of the Company as a result of this Agreement;
(ii) none of the Company's assets shall be held in or under any trust for the
benefit of Participant, or held in any way as security for the fulfillment of
the obligations of the Company under this Agreement; (iii) all of the Company's
assets shall be and remain the general unpledged and unrestricted assets of the
Company; (iv) the Company's obligation under this Agreement shall be that of an
unfunded and unsecured promise by the Company to pay money in the future; and
(v) Participant shall be an unsecured general creditor with respect to any
benefits which may be payable under the terms of this Agreement.
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8. Miscellaneous
8.1 Arbitration of Disputes. All claims, disputes and
other matters in question arising out of or relating to this Agreement or the
breach or interpretation thereof, other than those matters which are to be
determined by the Company in its sole and absolute discretion, shall be resolved
by binding arbitration before a representative member, selected by the mutual
agreement of the parties, of the Judicial Arbitration and Mediation Services,
Inc. ("JAMS"), located in San Francisco, California. In the event JAMS is unable
or unwilling to conduct the arbitration provided for under the terms of this
Paragraph, or has discontinued its business, the parties agree that a
representative member, selected by the mutual agreement of the parties of the
American Arbitration Association ("AAA") located in San Francisco, California,
shall conduct the binding arbitration referred to in this Paragraph. Notice of
the demand for arbitration shall be filed in writing with the other party to
this Agreement and with JAMS (or AAA, if necessary). In no event shall the
demand for arbitration be made after the date when institution of legal or
equitable proceedings based on such claim, dispute or other matter in question
would be barred by the applicable statute of limitations. The arbitration shall
be subject to such rules of procedure used or established by JAMS, or if there
are none, the rules of procedure used or established by AAA. Any award rendered
by JAMS or AAA shall be final and binding upon the parties, and as applicable,
their respective heirs, beneficiaries, legal representatives, agents, successors
and assigns, and may be entered in any court having jurisdiction thereof. The
obligation of the parties to arbitrate pursuant to this clause shall be
specifically enforceable in accordance with, and shall be conducted consistently
with, the provisions of Title 9 of Part 3 of the California Code of Civil
Procedure. Any arbitration hereunder shall be conducted in Lodi, California,
unless otherwise agreed to by the parties.
8.2 Attorneys' Fees. In the event of any arbitration or
litigation concerning any controversy, claim or dispute between the parties
hereto, arising out of or relating to this Agreement or the breach hereof, or
the interpretation hereof, the prevailing party shall be entitled to recover
from the losing party reasonable expenses, attorneys' fees and costs incurred in
connection therewith or in the enforcement or collection of any judgment or
award rendered therein. The "prevailing party" means the party determined by the
arbitrator(s) or court, as the case may be, to have most nearly prevailed, even
if such party did not prevail in all matters, not necessarily the one in whose
favor a judgment is rendered.
8.3 Notice. Any notice required or permitted of either
Participant or the Company under this Agreement shall be deemed to have been
duly given, if by personal delivery, upon the date received by the party or its
authorized representative; if by facsimile, upon transmission to a telephone
number previously provided by the party to whom the facsimile is transmitted as
reflected in the records of the party transmitting the facsimile and upon
reasonable confirmation of such transmission; and if by mail, on the third day
after mailing via U.S. first class mail, registered or certified, postage
prepaid and return receipt requested, and addressed to the party at the address
given below for the receipt of notices, or such changed address as may be
requested in writing by a party.
If to the Company: Bank of Lodi, N.A.
701 S. Ham Lane
Lodi, California 95242-3537
Attn: President
If to Participant: ____________________
____________________
____________________
8.4 Assignment. Participant shall have no power or right
to transfer, assign, anticipate, hypothecate, modify or otherwise encumber any
part or all of the amounts payable hereunder, nor, prior to payment in
accordance with the terms of this Agreement, shall any portion of such amounts
be: (i) subject to seizure by any creditor of Participant by a proceeding at law
or in equity, for the payment of any debts, judgments, alimony or separate
maintenance obligations which may be owed by Participant, Participant's spouse
or beneficiaries; or (ii) transferable by operation of law in the event of
bankruptcy, insolvency or otherwise. Any such attempted assignment or transfer
shall be void.
8.5 Binding Effect/Merger or Reorganization. This
Agreement shall be binding upon and inure to the benefit of Participant and the
Company and, as applicable, their respective heirs, beneficiaries, legal
representatives, agents, successors and assigns. Accordingly, the Company shall
not merge or consolidate into or with another corporation, or reorganize or sell
substantially all of its assets to another corporation, firm or person, unless
and until such succeeding or
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continuing corporation, firm or person agrees to assume and discharge the
obligations of the Company under this Agreement. In the alternative, the
Company's parent holding company may agree to assume and discharge the
obligation of the Company under this Agreement. Upon the occurrence of such
event, the term "Company" as used in this Agreement shall be deemed to refer to
such surviving or successor firm, person, entity or corporation, or the parent
holding company, as the case may be.
8.6 Nonwaiver. The failure of either party to enforce at
any time or for any period of time any one or more of the terms or conditions of
this Agreement shall not be a waiver of such term(s) or condition(s) or of that
party's right thereafter to enforce each and every term and condition of this
Agreement.
8.7 Partial Invalidity. If any terms, provision,
covenant, or condition of this Agreement is determined by an arbitrator or a
court, as the case may be, to be invalid, void, or unenforceable, such
determination shall not render any other term, provision, covenant or condition
invalid, void or unenforceable, and the Agreement shall remain in full force and
effect notwithstanding such partial invalidity.
8.8 Entire Agreement. This Agreement supersedes any and
all other agreements, either oral or in writing, between the parties with
respect to the subject matter of this Agreement and contains all of the
covenants and agreements between the parties with respect thereto. Each party to
this Agreement acknowledges that no other representations, inducements,
promises, or agreements, oral or otherwise, have been made by any party, or
anyone acting on behalf of any party, which are not set forth herein, and that
no other agreement, statement, or promise not contained in this Agreement shall
be valid or binding on either party.
8.9 Modifications. Any modification of this Agreement
shall be effective only if it is in writing and signed by each party or such
party's authorized representative.
8.10 Paragraph Headings. The paragraph headings used in
this Agreement are included solely for the convenience of the parties and shall
not affect or be used in connection with the interpretation of this Agreement.
8.11 No Strict Construction. The language used in this
Agreement shall be deemed to be the language chosen by the parties hereto to
express their mutual intent, and no rule of strict construction will be applied
against any person.
8.12 Governing Law. The laws of the State of California,
other than those laws denominated choice of law rules, and where applicable, the
rules and regulations of the Board of Governors of the Federal Reserve System,
Federal Deposit Insurance Corporation, Office of the Comptroller of the
Currency, or any other regulatory agency or governmental authority having
jurisdiction over the Company or its parent holding company, shall govern the
validity, interpretation, construction and effect of this Agreement.
IN WITNESS WHEREOF, the Company and Participant have executed this
Agreement on the date first above-written in the City of Lodi, San Joaquin
County, California.
COMPANY PARTICIPANT
Bank of Lodi, N.A.
By:________________________________ _________________________________
Leon J. Zimmerman, ____________________
President and Chief Executive Officer
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ACKNOWLEDGEMENT OF SPOUSE
I am the spouse of the Participant named in this Agreement. I
understand that the Insurer named in this Agreement has offered to Participant
the right to purchase long term care insurance for me, at Participant's sole
cost and expense (i.e., the Company is not obligated to pay the premiums on such
insurance). Participant and I have jointly made the decision to purchase, or not
to purchase, the long term care insurance for me.
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(Signature)
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(Name--Please Print)
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(Date)