CONTRACT OF EMPLOYMENT
This Contract of Employment is made this 17th day of November, 2005, and is
effective as of the 17th day of November, 2005, by and between Islands Community
Bank, A South Carolina Corporation, hereinafter referred to as the "EMPLOYER",
and John R. Perrill, hereinafter referred to as the "EMPLOYEE".
In consideration of the mutual covenants contained herein, and for other
good and valuable consideration, the receipt and sufficiency which is hereby
acknowledged. The Parties hereto, hereby agree as follows:
1. EMPLOYMENT:
The Employer shall employ the Employee, and the Employee shall serve the
Employer as Senior Loan Officer/Acting CEO. The Employee shall serve as
Acting CEO until his replacement has been named. The Employee shall have
such authority and responsibilities consistent with his positions as set
forth in the Employer's By-Laws and Policies. Except with the written
consent of the Employee, Employee shall not be permanently assigned to any
position of lower professional status. The parties hereto further agree to
the following terms and conditions.
2. TERM:
Unless earlier terminated as provided herein, the initial term of the
Employee's employment under this agreement shall be for a term of five (5)
consecutive years, commencing on the effective date herein above stated.
3. COMPENSATION AND BENEFITS:
As compensation for the services to be rendered by the Employee under this
agreement, Employee shall be compensated as follows:
a) the Employee shall have a base salary as of the effective date herein
above written of $135,000.00 per year, and shall be entitled to salary
increases pursuant to the "Salary and Bonus Incentive Plan"
implemented by the Board of Directors. The Salary and Bonus Incentive
Program is attached hereto and made a part hereof.
b) The Employee shall be entitled to all fringe benefits as are provided
to all bank employees under the Bank's fringe benefit program.
c) Dues: Employer shall pay all dues of Employee as a member of two
----
service and two social or country club organizations, which shall be
approved by the parties hereto.
d) Vacation: Employer shall provide paid vacation time to Employee as
--------
provided by Bank or "Company" policy, commencing as of effective date
of this Agreement.
Such days are to be taken at such time or times as Employee may
reasonably request, subject to the Employee's convenience and prior
approval, which approval shall not be unreasonably withheld. Vacation
time shall not cumulate year-to-year. Any unused vacation time will be
reimbursed to the Employee.
e) Car Allowance: The Employer shall provide Employee a car or travel
-------------
allowance of $600.00 per month.
f) Health Insurance: The Employer shall provide the Employee with health
----------------
insurance under an individual or group insurance plan. The Employee
shall be required to pay 50% of the monthly, quarterly or annual
premium for coverage for his spouse.
g) Expenses: The Employer shall reimburse the Employee for all expenses
--------
paid by the Employee while providing services for the Employer
pursuant to this Contract of Employment.
h) The Employer shall provide to the Employee a "401-K" Retirement and
Investment Plan, and match any payments which Employee shall make into
such 401-K plan up to 6%.
i) Severance Pay: In the event that the Employer shall sell the "Bank"
-------------
within a five year period from the effective date of this agreement,
the Employee shall be entitled to two years severance pay upon change
of control, unless, the Employee is provided continued employment
under the same terms and conditions as are herein provided or
substantially the same terms and conditions as provided herein. A
substantial change in terms and conditions shall include but is not
limited to
a) reduction in salary,
b) change in position or duties and responsibilities,
c) change in benefits provided herein, or
d) bonus provisions.
A substantial change in terms and conditions shall not include a
return to the position of Senior Loan Officer once a CEO has been
named.
5. TERMINATION:
a) For Cause by Employer. Notwithstanding any other provisions hereof,
---------------------
Employer may terminate Employee's employment under this Agreement
immediately at any time for Cause upon delivery to Employee of written
notice specifying the basis for such termination hereunder. The term
Cause shall include any of the following: (i) the commission by
Employee of a willful act (including, without limitation, a dishonest,
fraudulent or unethical act, or willful or recurring insubordination)
or a grossly negligent act, or the willful or grossly negligent
omission to act by Employee, which is intended to cause, or causes
material harm to Employer, (ii) the indictment of Employee for the
commission or perpetration by Employee of any felony or any crime
involving dishonesty, moral turpitude or fraud, (iii) the material
breach by Employee of this Agreement, (iv) the material violation by
Employee of any federal or state banking law, rule or regulation;
causing or permitting, whether intentionally or negligently, Employer
to materially violate any federal or state banking law, rule or
regulation, (v) the suspension or temporary prohibition of Employee's
participation in the conduct of the affairs of Employer or any
subsidiary of Employer by notice served under Section 8(e) of the
Federal Deposit Insurance Act (12 U.S.C., Section 1818(e), (vi) the
receipt of any form of notice, written or otherwise, that any
regulatory agency having jurisdiction over Employer intends to
institute any form of formal or informal (e.g., a memorandum of
understanding which relates to Employee's performance) regulatory
action
against Employee or Employer (provided that the Board of Directors
determines in good faith, that the subject matter of such action
involves acts or omissions by or under the supervision of Employee or
that termination of Employee would materially advance Employer's
compliance with the purpose of the action or would materially assist
Employer in avoiding or reducing the restrictions or adverse effects
to Employer related to the regulatory action), (vii) the exhibition by
Employee of a standard of behavior within the scope of his employment
that is materially disruptive to the orderly conduct of Employer's
business operations (including, without limitation, substance abuse or
sexual misconduct) to a level which, in the Board of Director's good
faith and reasonable judgment, is materially detrimental to Employers
best interest; (viii) the failure of Employee to devote his full
business time and attention to his employment as provided under this
Agreement that, if susceptible of cure, remains uncured 60 days
following written notice to Employee of such failure; or (ix) the
failure by the Employee to achieve or maintain the reasonable
performance goals established by the Board of Directors from time to
time for Employee and Employer that, if susceptible of cure, remains
uncured 60 days following written notice to Employee of such failure.
All compensation (including without limitation the base salary, and
all perquisites and fringe benefits) to which Employee would otherwise
be entitled (for periods after the effective date of such termination)
shall be discontinued and forfeited as of the effective date of such
termination.
b) Without Cause by Employer. The Bank shall pay to the Employee in a
-------------------------
lump sum, an amount equal to the sum of (a) the Employee's salary, as
in effect at the effective time of the termination of employment and,
(b) the amount of the bonus earned by the Employee during the prior
calendar year (the "lump sum payment").
c) Termination by Employee. Employee may with, or without cause,
-----------------------
terminate this Agreement upon thirty (30) days prior written notice to
Employer. In the event of such termination all compensation (including
without limitation, the annual salary, and all perquisites and fringe
benefits, as well as any bonus earned in the previous twelve (12)
month period shall be forfeited as of the effective date of such
termination.
d) Disability. In the event of the Employee's disability during
----------
employment under this Agreement, then employment under this Agreement
shall terminate. For purposes of this Agreement, except as provided
herein below, "disability" shall mean the inability of Employee, due
to sickness or other incapacity, to perform Employee's duties under
this Agreement for a period in excess of ninety (90) substantially
consecutive days. Such termination shall become effective at
Employer's election upon the expiration of such ninety (90) day period
of disability. Upon termination of employment under this Agreement due
to Employee's disability, all compensation (including without
limitation the base salary, and all perquisites and fringe benefits)
to which Employee would otherwise be entitled (for periods after the
effective date of such termination) shall be discontinued and
forfeited as of the effective date of such termination. During the
period of any incapacity leading up to and ending on the termination
of the Employee's employment as a result of disability, the Employer
shall continue to pay the Employee his full salary at the rate then in
effect and all perquisites and other benefits (other than any bonus).
Furthermore, the Employee shall receive any bonus earned or accrued
under the Bonus Plan through the date of incapacity (including any
amounts awarded for previous years but which were not yet vested) and
a pro rata share of any bonus with respect to the current fiscal year
which had been earned as of the date of the
Employee's incapacity. These provisions shall be applicable exclusive
of the terms and provisions of any Disability Insurance Policy
provided by the Employer.
e) Return of Materials. The Employee shall surrender to the Employer,
-------------------
promptly upon its request and in any event upon termination of the
Employee's employment, all media, documents, notebooks, computer
programs, handbooks, data files, models, samples, price lists,
drawings, customer lists, prospect data, or other material of any
nature whatsoever (in tangible or electronic form) in the Employee's
possession or control, including all copies thereof, relating to the
Employer, its business, or its customers. Upon the Request of the
Employer, Employee shall certify in writing compliance with the
foregoing requirement.
6. Confidentiality and Secrecy. Employee acknowledges that in and as a
---------------------------
result of Employee's employment hereunder, Employee will be making use of,
acquiring, and/or adding to confidential information of a special and
unique nature and value relating to Employer's business, including without
limitation technological know how, copyrights, proprietary information,
trade secrets, systems, procedures, manuals, confidential reports, records,
operational expertise, lists of customers and projects, the nature and type
of services rendered by Employer, the equipment and methods used and
preferred by Employer's customers, and the fees paid by them (all of which
are deemed for all purposes confidential and proprietary). As a material
inducement to Employer to enter into this Agreement and to pay to Employee
the compensation stated in Section 3, Employee covenants and agrees that
---------
during the term of Employee's employment hereunder, and for one (1) year
after the expiration or earlier termination of Employee's employment by
Employer or an affiliate of Employer, Employee shall not, directly, make
use of, or disclose to any person or entity, any confidential information
of Employer or its affiliates.
7. Burden and Benefit. This Agreement shall be binding upon, and shall inure
------------------
to the benefit of, Employer and Employee and their respective personal and
legal representatives, successors, and permitted assigns.
8. Assignment. This Agreement and any rights hereunder are personal to
----------
Employee and Employer shall not be assigned or otherwise transferred by
Employee. Employer shall be entitled to assign this Agreement to any
corporation controlled by Employer.
9. Governing Law/Jurisdiction. The construction and interpretation of this
--------------------------
Agreement shall at all times and in all respects, be governed by the laws
of the State of South Carolina. The parties hereby (i) agree that any
litigation, action or proceeding arising out of or relating to this
Agreement may be instituted in a state or federal court in the State of
South Carolina, (ii) waives any objection which it might have now or
hereafter to any such litigation, action or proceeding based upon improper
venue or inconvenient forum, and (iii) irrevocably submits to the
jurisdiction of such courts in any such litigation, action or proceeding.
For all purposes of this Agreement, the parties hereby further agree that
service of process upon any party may be effective pursuant to United
States mail.
10. Severability. The provisions of this Agreement shall be deemed
------------
severable, and the invalidity or unenforceability of any one or more of the
provisions of this Agreement shall not affect the validity and
enforceability of the other provisions.
11. Modifications. This Agreement can only be modified by a written
-------------
agreement duly signed by authorized representatives of the parties hereto.
Moreover, in order to avoid uncertainty, ambiguity and misunderstandings in
their relationships, the parties hereto
covenant and agree not to enter into any oral agreement or understanding
inconsistent or in conflict with this Agreement; and the parties hereto
further covenant and agree that any oral communication allegedly or
purportedly constituting such an agreement or understanding shall be
absolutely null, void and without effect.
12. Waiver. Any waiver by either party of any breach or any term or
------
condition hereof shall be effective only if in writing and such writing
shall not be deemed to be a waiver of any subsequent or other breach, term
or condition of this Agreement.
13. Entire Agreement. This Agreement contains the entire agreement and
----------------
understanding by and between Employer and Employee with respect to the
subject matter hereof and supersedes all prior and contemporaneous written
or oral agreement and representations between the parties with respect
thereto.
IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement
under seal to be effective as of the day and year first above written.
IN THE PRESENCE OF: EMPLOYEE:
/s/ Carol J. Nelson
- ----------------------------
Witness
/s/ Louis O. Dore /s/ John R. Perrill
- ---------------------------- -----------------------------
Witness JOHN R. PERRILL
EMPLOYER
/s/ Carol J. Nelson
- ----------------------------
Witness
/s/ Louis O. Dore By: /s/ D. Martin Goodman
- ---------------------------- -----------------------------
Witness Its: Chairman