Exhibit 10.5
EMPLOYMENT AGREEMENT
     THIS AGREEMENT (this “Agreement”) is entered into this 31st day of May,
2005, between Exchange National Bancshares, Inc., a Missouri corporation (the
“Company”), and James H. Taylor, Jr. (the “Employee”). Collectively, the
Company, the Employee, and the Bank (as defined below) may be referred to as the
“Parties” and each individually as a “Party.”
WITNESSETH:
     WHEREAS, the Company is a bank holding company controlling 100% of the
issued and outstanding shares of common stock of Union State Bank & Trust of
Clinton, a Missouri trust company (the “Bank”); and
     WHEREAS, Employee desires to become employed by the Company in an executive
capacity as Senior Vice President and Senior Credit Officer of the Company for a
period of at least three (3) years, and the Company desires to employ Employee
to serve in such capacity, for the compensation and in accordance with the terms
and provisions contained in this Agreement; and
     NOW, THEREFORE, in consideration of the foregoing and the mutual promises
and covenants contained herein, the Company and Employee agree as follows:
     1. Employment. The Company agrees to employ the Employee and the Employee
agrees to be employed by the Company in an executive capacity upon the terms and
conditions of this Agreement for a period of three (3) years from and after the
date of this Agreement, and any extensions thereafter, unless earlier terminated
as provided in Section 9 hereof. At each anniversary of the date of this
Agreement, this Agreement shall be automatically extended for one additional
year unless the Company or the Employee gives the other party written notice of
such party’s intention not to extend the Agreement at least thirty (30) days
prior to such anniversary date. Employee agrees that he will accept employment
as Senior Vice President and Senior Credit Officer of the Company, without
limitation of other titles, for the effective period of this Agreement. The
Employee’s primary location of employment during the term of this Agreement
shall be in Saint Louis, Missouri unless the Employee consents in writing to
relocate to another geographic location.
     2. Compensation. For all services rendered by the Employee to the Company,
the Company shall pay the Employee a salary of not less than one hundred fifty
thousand dollars ($150,000) per year, payable in accordance with the customary
payroll practices of the Company, but in no event less frequently than monthly.
Salary payments shall be subject to withholding and other applicable taxes.
Employee shall be eligible for merit-based increases in compensation on the
terms and conditions offered to employees of the Company generally having
responsibilities commensurate to that of Employee. Employee shall be eligible to
participate in such bonus or other incentive compensation plans as currently are
or may be established by the Company for employees generally having
responsibilities commensurate to

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that of Employee, provided that in any given fiscal year, the bonus compensation
to the Employee shall not be less than 20% of Employee’s base salary.
     3. Expenses. The Company shall reimburse the Employee for all ordinary and
necessary expenses incurred and paid by the Employee in the course of the
performance of the Employee’s duties pursuant to this Agreement and consistent
with the Company’s policies in effect from time to time with respect to travel,
entertainment, other business expenses, and expenses relating to memberships in
business organizations, including without limitation the Risk Management
Association and the Certified Fraud Examiners Association. Reimbursement of such
expenses shall be subject to the Company’s requirements with respect to the
manner of reporting such expenses.
     4. Additional Benefits. The Employee shall be eligible for such fringe
benefits, if any, by way of insurance, hospitalization, vacations, stock bonus
plans, and profit sharing plans normally provided to employees of the Company
generally having responsibility commensurate to that of the Employee and such
additional benefits as may be from time to time agreed upon in writing between
the Employee and the Company; and further provided, to that there shall be no
waiting period for eligibility to participate in such additional benefits. The
Company shall provide to the Employee a new Company owned or leased automobile
of a year, make, and model agreed to between the Company and the Employee,
befitting the executive office held by Employee not less than every three years,
and the Company shall pay the expenses related to the use, upkeep, and insurance
of the vehicle. At the termination of this Agreement, Employee shall have the
option to purchase the vehicle for the contractual buy-out price of any loan or
lease on the vehicle. If the vehicle is not financed or leased by the Company,
Employee shall have the option to purchase the vehicle at a wholesale value to
be agreed upon between the Company and Employee. The tax treatment of all fringe
benefits shall be handled in a manner consistent with the customary practices of
the Bank and the Company.
     5. Duties. The Employee agrees that so long as he is employed under this
Agreement he will (i) to the satisfaction of the Company devote his best efforts
and his entire business time to further the interests of the Company, (ii) at
all times be subject to the direction and control of the Board of Directors of
the Company with respect to his activities on behalf of the Company,
(iii) comply with all rules, orders and regulations of the Company,
(iv) truthfully and accurately maintain and preserve such records and make all
reports as the Company may require, and (v) fully account for all monies and
other property of the Company of which he may from time to time have custody and
deliver the same to the Company whenever and however directed to do so.
     6. Covenant Not To Disclose Confidential Information. The Employee
acknowledges that during the course of his employment with the Company he has or
will have access to and knowledge of certain information and data which the
Company considers confidential and that the release of such information or data
to unauthorized persons would be extremely detrimental to the Company. As a
consequence, the Employee hereby agrees and acknowledges that he owes a duty to
the Company not to disclose, and agrees that, during or after the term of his
employment, without the prior written consent of the Company he will not

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communicate, publish or disclose, to any person anywhere or use any Confidential
Information (as hereinafter defined) for any purpose other than carrying out his
duties as contemplated by this Agreement. The Employee will use his best efforts
at all times to hold in confidence and to safeguard any Confidential Information
from falling into the hands of any unauthorized person and, in particular, will
not permit any Confidential Information to be read, duplicated, or copied. The
Employee will return to the Company all Confidential Information in the
Employee’s possession thereof, or whenever the Company shall so request, and in
any event will promptly return all such Confidential Information if the
Employee’s relationship with the Company is terminated for any reason and will
not retain any copies thereof. The term “Confidential Information” shall mean
any information or data used by or belonging or relating to the Company that is
not known generally to the banking community, including without limitation, any
and all proprietary data and information relating to the Company’s or the Bank’s
past, present or future business plans, services offered, financial information,
customer lists, and other information concerning customers, depositors, and
borrowers of the Company or any subsidiary of the Company, whether or not
reduced to writing, or information or data which the Company advises the
Employee should be treated as confidential information.
     7. Covenant Not To Compete. The Employee agrees that during the term of his
employment by the Company, and for a period of two (2) years from and after the
termination of such employment for any reason other than a termination by the
Employee pursuant to Section 9(c), he will not, directly or indirectly, without
the express written consent of the Company:
     a. own, manage, operate, control, or participate in the ownership,
management, operation, control, or financing of, or have any interest, financial
or otherwise, in or act as an officer, director, partner, principal, employee,
agent, representative, consultant, or independent contractor of, or in any way
assist any bank, savings and loan, savings bank, or other financial institution
(other than the Bank) that is located or has an office in Cole County, Missouri.
     b. solicit for employment or hire any employees of the Bank; or
     c. solicit, or interfere with, any contracts or business relationships with
any customer, depositor, or borrower of the Bank.
     8. Remedies. In the event that the Employee breaches any of the foregoing
covenants and assurances contained in Section 6 or 7, the Company and it
successors and assigns, in addition to such other remedies which may be
available to them, shall be entitled to an injunction, including a mandatory
injunction, to be issued by any court of competent jurisdiction ordering
compliance with this Agreement or enjoining or restraining the Employee, and
each and every person, firm, or company acting in concert or participation with
him, from the continuation of such breach. Should a court of competent
jurisdiction find that an actual breach occurred, the Employee shall pay to the
Company all ascertainable damages, including costs and reasonable attorneys’
fees sustained by the Company by reason of the breach of said covenant and
assurances. The obligations of the Employee and the rights of the

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Company, its successors and assigns under Sections 6 and 7 of this Agreement
shall survive the termination of this Agreement. The covenant and the
obligations of the Employee set forth in Sections 6 and 7 are in addition to and
not in lieu of or exclusive of any other obligations and duties of the Employee
to the Company, whether express or implied in fact or in law.
     9. Termination Prior to Change in Control.
     a. This Agreement shall terminate immediately upon the death, disability,
or adjudication of legal incompetence of the Employee. Termination pursuant to
this subparagraph (a) shall not affect any benefits Employee or Employee’s
successors may be entitled to under any life or disability policy provided to
the Employee by the Company. For purposes of this Agreement, the Employee shall
be deemed disabled when the Employee has become unable, by reason of physical or
mental disability, to satisfactorily perform his essential job duties and there
is no reasonable accommodation that can be provided to enable him to be a
qualified individual with a disability under applicable law. Such matters shall
be determined by, or to the reasonable satisfaction of, the Board of Directors
of the Company.
     b. This Agreement may be terminated by the Company upon notice to the
Employee for “Cause.” For purposes of this Agreement, “Cause” shall mean the
occurrence of any of the following events:
     i. Performance by the Employee of illegal or fraudulent acts, criminal
conduct or willful misconduct, or gross negligence relating to the activities of
the Company or the Bank;
     ii. Performance by the Employee of any criminal acts involving moral
turpitude having a material adverse effect upon the Company or the Bank,
including, without limitation, upon their profitability, reputation, or
goodwill;
     iii. Failure by the Employee to perform his duties in a manner which he
knows, or has reason to know, to be in the Company’s or the Bank’s best
interests, which he fails to cure within thirty days after receiving written
notice thereof;
     iv. Continued conduct by the Employee that is damaging to the business,
employee, or customer relations of the Company or the Bank and which is ongoing
more than thirty days after receiving written notice from the Company or the
Bank to cease such conduct; or
     v. Any other material breach of the Employee’s obligations under this
Agreement which is incurable or which he fails to cure within thirty days after
receiving written notice thereof.

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     c. This Agreement may be terminated by the Employee upon written notice to
the Company in the event of a material breach of the Company’s obligations under
this Agreement which is incurable or which the Company fails to cure within
15 days after receiving written notice thereof.
     d. In the event this Agreement is terminated for Cause, the parties’
obligations under this Agreement shall terminate immediately (except as
otherwise provided herein), and neither the Employee nor his estate, heirs,
successors, or assigns shall be entitled to any further compensation under the
Agreement other than payment of any unpaid severance or compensation that
accrued prior to such termination; provided, however, that the termination of
this Agreement pursuant to subsections (b) or (c) of this Section shall not
limit any other remedies to which the terminating party may be entitled to in
law or equity as a result of any breach of this Agreement by the other Party.
     e. In the event that the Employee’s employment with the Company is
terminated by the Company, other than for “Cause,” or if the Employee shall
voluntarily terminate his employment pursuant to subsection (c) of this section,
then, in either case, the Company agrees to continue to pay to Employee his
monthly salary as in effect at the time of termination for the remaining
effective period under the Agreement, but in any scenario for no less than
twelve (12) months, following the date of termination of employment, and during
such period shall also continue to pay the Employee’s insurance benefit costs up
to the dollar amount paid by the Company during the year immediately prior to
such termination; provided, however, in the event of a “Change of Control,” as
defined in that certain Agreement attached as Appendix A and incorporated herein
(the “Change of Control Agreement”), the provisions of the Change of Control
Agreement will apply. To the extent there are any inconsistent provisions in the
Change of Control Agreement and the Employment Agreement, the Change of Control
Agreement will control, invalidating any inconsistent or duplicative provision
in the Employment Agreement.
     f. Transfer of the Employee to a successor or permitted assign of the
Company which shall offer employment to Employee on comparable terms as the
Company shall not be considered termination of Employment for purposes of this
Agreement. Any such offer of employment which requires relocation by Employee
shall not be considered comparable. Further, any required change in geographic
location, whether or not it follows a Change of Control, if not accepted by
Employee, shall constitute a termination without “Cause,” and further shall
relieve Employee of his obligations under Section 7 and entitle Employee to the
payment specified in Section 9(e). Should Employee agree to change in geographic
location, the Company shall reimburse Employee for all costs associated with
moving to the new geographic location, including without limitation the costs of
moving Employee’s personal belongings and other property.

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     10. Successors.
     a. This Agreement is personal to the Employee and shall not be assigned by
Employee without prior written consent of the Company otherwise than by will or
the laws of descent and distribution.
     b. This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.
     c. The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) to all or substantially all of
the business and/or assets of the Company to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
     11. Severability. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
     12. Waiver of Breach. Failure of the Company to demand strict compliance
with any of the terms, covenants, or conditions of this Agreement shall not be
deemed a waiver of the term, covenant, or condition, nor shall any waiver or
relinquishment by the Company of any right or power hereunder at any one time or
more times be deemed a waiver or relinquishment of the right or power at any
other time or times.
     13. No Conflicts. The Employee represents and warrants to the Company that
neither the execution nor delivery of this Agreement, nor the performance of the
Employee’s obligations hereunder will conflict with, or result in a breach of,
any term, condition, or provision of, or constitute a default under, any
obligation, contract, agreement, covenant, or instrument to which the Employee
is a party or under which the Employee is bound, including without limitation,
the breach by the Employee of a fiduciary duty to any former employers.
     14. Entire Agreement; Amendment. This Agreement cancels and supersedes all
previous agreements relating to the subject matter of this Agreement, written or
oral, between the parties hereto and contains the entire understanding of the
parties relating to the terms of the Employee’s employment and shall not be
amended, modified, or supplemented in any manner whatsoever except as otherwise
provided herein or in writing signed by each of the parties.
     15. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall in no way restrict or
otherwise modify any of the terms or provisions hereof.
     16. Governing Law. This Agreement and all rights and obligations of the
Parties shall be governed by, and construed and interpreted in accordance with,
the laws of the State

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of Missouri applicable to agreements made and to be performed entirely within
the State, including all matters of enforcement, validity, and performance.
     17. Arbitration. Any dispute between any of the Parties or claim by a Party
against another Party arising out of or in relation to this Agreement or in
relation to any alleged breach thereof shall be finally determined by
arbitration in accordance with the rules then in force of the American
Arbitration Association, except as otherwise provided for in this Agreement. The
arbitration proceedings shall take place in Saint Louis, Missouri, or such other
location as the Parties in dispute may agree upon; and such proceedings shall be
governed by the laws of the State of Missouri as such laws are applied to
agreements between residents of such State entered into and to be performed
entirely within that State.
     The Parties shall agree upon one arbitrator, who shall be an individual
skilled in the legal and business aspects of the subject matter of this
Agreement and of the dispute. If the Parties cannot agree upon one arbitrator,
each Party in dispute shall select one arbitrator and the arbitrators so
selected shall select a third arbitrator. In the event the arbitrators cannot
agree upon the selection of a third arbitrator, the third arbitrator shall be
appointed by the American Arbitration Association at the request of the Parties
in dispute. The arbitrator shall, if possible, be individuals skilled in the
legal and business aspects of the subject of the Agreement and of the dispute.
     The decision rendered by the arbitrator or arbitrators shall be accompanied
by a written opinion in support thereof. The decision shall be final and binding
upon the Parties without right to appeal. Judgment upon the decision may be
entered into in any court having jurisdiction thereof, or application may be
made to that court for a judicial acceptance of the decision and an order of
enforcement. Costs of the arbitration shall be assessed by the arbitrator or
arbitrators against any or all of the parties in dispute, and shall be paid
promptly by the Party or Parties so assessed.
     18. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one agreement which is binding upon all Parties.
     19. Notice. All notices, requests, demands, and other communications shall
be deemed duly given if delivered by hand or if mailed by certified or
registered mail with postage prepaid or nationally recognized delivery service
with delivery confirmed, addressed as follows:
          If to the Company:
Exchange National Bancshares, Inc.
132 E. High Street
Jefferson City, MO 65010-0688
Attn: President

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          If to the Employee:
James H. Taylor, Jr.
6729 Wynfield Terrace Drive
St. Louis, MO 63129
or to any other address as either party may provide to the other in writing.
     THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE
ENFORCED BY THE PARTIES.
     IN WITNESS WHEREOF, the Company and Employee have executed this Agreement
as of the day and year first above written.

            COMPANY:

EXCHANGE NATIONAL BANCSHARES, INC.
      By:   /s/ James E. Smith         Name:   James E. Smith        Title:  
Chairman & CEO        EMPLOYEE:
      /s/ James H. Taylor, Jr.       James H. Taylor, Jr.           

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