Exhibit 10.28

 

EMPLOYMENT AGREEMENT BETWEEN

QCR HOLDINGS, INC.

AND

Cathie Whiteside

 

 

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) dated as of the 27th day of August,
2007 is between QCR HOLDINGS, INC. (the “Employer”) and Cathie Whiteside (the
“Employee”).

 

RECITALS

 

WHEREAS, the Employer desires to employ Employee as an officer of the Employer
and Employee desires to become employed as an officer of the Employer; and

 

WHEREAS, the Employer and the Employee have made commitments to each other on a
variety of important issues concerning Employee’s employment, including the
performance that will be expected of Employee, the compensation the Employee
will be paid, how long and under what circumstances Employee will remain
employed and the financial details relating to any decision that either the
Employer or the Employee might ever make to terminate this Agreement; and

 

WHEREAS, the Employer recognizes that circumstances may arise in which a change
in control of the Employer through acquisition or otherwise may occur thereby
causing uncertainty of employment without regard to the competence or past
contributions of the Employee which uncertainty may result in the loss of
valuable services of the Employee, and the Employer and the Employee wish to
provide reasonable security to the Employee against changes in the employment
relationship in the event of any such change in control.

 

NOW, THEREFORE, in consideration of the promises and of the covenants and
agreements hereinafter contained, it is covenanted and agreed by and among the
parties hereto as follows:

 

AGREEMENTS

 

Section 1.     Employment. The Employer hereby employs the Employee, and the
Employee hereby accepts employment, upon the terms and conditions hereinafter
set forth.

 

Section 2.     Duties. The Employee agrees to provide all services necessary,
incidental or convenient as the EVP, Corporate Strategy and Branding of the
Employer and such similar duties for the Employer’s subsidiaries as a dual
employee of the Employer’s subsidiaries as may be from time to time requested by
the Employer. The Employer shall designate the location or locations for the
performance of the Employee's services. The Employer shall furnish or make
available to the Employee such equipment, office space and other facilities and
services as shall be adequate and necessary for the performance of Employee’s
duties.

  

 
 

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Section 3.     Term. The term of this Agreement shall commence on August 27th,
2007 (the “Effective Date”), and shall continue for a period of one (1) year.
This Agreement shall automatically extend for one (1) year on each anniversary
of the Effective Date, unless terminated by either party effective as of the
last day of the then current one (1) year extension by written notice to that
effect delivered to the other not less than ninety (90) days prior to the
anniversary of such Effective Date.

 

Section 4.     Compensation. As compensation for the services to be provided by
the Employee hereunder:

 

(a)     Base Salary. The Employer shall pay Employee an annual base salary of
One Hundred Ten Thousand dollars ($110,000.00) (“Base Salary”). Base Salary
shall be payable bi-weekly, in equal installments in accordance with the
Employer’s payroll practice. The Employee's Base Salary shall be subject to
review annually, commencing January 1, 2008, and shall be maintained or
increased during the term hereof in accordance with the Employer's established
management compensation policies and plan.

 

(b)     Bonuses. The Employee shall be entitled to receive cash bonuses (“Cash
Bonus” or “Cash Bonuses”) based upon performance which may be granted in the
future in the discretion of the Employer. In addition, the Employee may receive
such additional bonuses or awards in the form of stock options, restricted stock
or other equity compensation, as determined in the discretion of the Employer.

 

(c)     Benefits. The Employer shall provide the following additional benefits
to the Employee:

 

(i)     Medical Insurance. Family medical insurance, provided that Employee
shall be responsible for paying any portion of the premium in accordance with
the Employer’s policy applied to similarly situated employees.

 

(ii)     Reimbursements. Reimbursement of reasonable expenses advanced by the
Employee in connection with performance of Employee’s duties hereunder.

 

(iii)     Personal Days. The Employee will initially be entitled to twenty five
(25) personal days, which may be increased in accordance with the Employer's
established policies and practices.

 

(iv)     Disability Coverage. Long-term and short-term disability coverage equal
to approximately 60% of Base Salary and Average Annual Bonus, subject to the
terms of the Employer’s insurance or other policies covering the same, as such
percentage or other terms may be changed from time to time by the Employer. For
purposes of this Agreement, “Average Annual Bonus” shall mean the average of the
three (3) most recent annual Cash Bonuses paid to the Employee immediately
preceding the determination date.

 

(v)     Employee Benefits: Participation in a 401(k)/profit sharing plan,
deferred compensation program and such other benefits as are specifically
granted to Employee or in which Employee participates as an employee of the
Employer.

  

 
 

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(vi)     Life Insurance. Universal life insurance of two (2) times Base Salary
and Average Annual Bonus as of the date of this Agreement. The Employee will be
allowed to purchase additional life insurance of at least that same amount
through such plan.

 

Section 5.     Stock Options. On the first business day of the month following
the Effective Date, the Board, or the appropriate committee thereof, shall grant
the Employee an option to purchase five thousand (5000) shares of common stock
of the Employer (the “Stock Option”) pursuant to the terms of the QCR Holdings,
Inc. 1997 Stock Incentive Plan (the “Stock Incentive Plan”). The Stock Option
shall (i) have an exercise price per share equal to the Fair Market Value (as
defined in the Stock Incentive Plan) of the shares on the date of grant; (ii)
have a term of ten (10) years; (iii) be a non-qualified Stock Option; and
(iv) vest twenty percent (20%) on each anniversary of the date of grant (fully
vested on the 5th anniversary of the Effective Date).

 

Section 6.     Non-Qualified Deferred Compensation. Employee shall be eligible
to participate in a non-qualified deferred compensation arrangement under which
the Employee may elect to defer up to fifteen percent (15%) of the Employee’s
Base Salary and Cash Bonus, if any, and a match of 50% with a maximum of 6%. The
Employer shall credit such deferral with an interest rate of the prime rate as
reported in the Wall Street Journal plus one percentage point as of January 1
each year, provided such rate shall not be less than four percent (4%) and no
more than eight percent (8%) per annum. All other terms of the deferred
compensation arrangement shall be determined by the Employer and set forth in
the governing documents of such arrangement.

 

Section 7.     Time Requirement. The Employee shall devote Employee’s best
efforts and full business time to Employee’s duties under this Agreement. The
Employee shall be allowed to serve on outside boards subject to the consent of
the Employer.

 

Section 8.     Termination upon Disability. In the event of the Employee’s
Disability (as defined below) during the employment term, payments based upon
the Employee's then current annual Base Salary and Average Annual Bonus shall
continue thereafter through the last day of the one (1) year period beginning on
the date of such Disability, after which time Employee’s employment shall
terminate. Payments made in the event of the Employee's Disability shall be
equal to 60% of Employee’s Base Salary and Average Annual Bonus, less any
amounts received under the Employer's short or long-term disability programs, as
applicable. Disability for purposes of this Agreement shall mean that the
Employee is limited from performing the material and substantial duties of the
position(s) set forth in Section 2 due to the Employee’s sickness or injury for
a period of six (6) consecutive months. The Board shall determine whether and
when the Employee has incurred a Disability under this Agreement. In the event
of the Employee's death during the term of this Agreement, such amounts shall be
payable to the persons designated in writing by the Employee, or if none, to
Employee’s estate.

  

 
 

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Section 9.     Confidentiality and Loyalty. The Employee acknowledges that
during the course of Employee’s employment Employee has produced and will
produce and have access to material, records, data, trade secrets and
information not generally available to the public (collectively, “Confidential
Information”) regarding the Employer and any subsidiaries and affiliates.
Accordingly, during and subsequent to termination of this Agreement, the
Employee shall hold in confidence and not directly or indirectly disclose, use,
copy or make lists of any such Confidential Information, except to the extent
that such information is or thereafter becomes lawfully available from public
sources, or such disclosure is authorized in writing by the Employer, required
by a law or any competent administrative agency or judicial authority, or
otherwise as reasonably necessary or appropriate in connection with performance
by the Employee of Employee’s duties hereunder. All records, files, documents
and other materials or copies thereof relating to the Employer's business which
the Employee shall prepare or use, shall be and remain the sole property of the
Employer, shall not be removed from the Employer's premises without its written
consent, and shall be promptly returned to the Employer upon termination of the
Employee's employment hereunder. The Employee agrees to abide by the Employer's
reasonable policies, as in effect from time to time, respecting avoidance of
interests conflicting with those of the Employer.

 

Section 10.     Non-Solicitation.

 

(a)     Non-Solicitation Covenant. As an essential ingredient of and in
consideration of this Agreement and the payment of the amounts described in
Sections 4 and 11, the Employee hereby agrees that, except with the express
prior written consent of the Employer, for a period of eighteen months (18)
after the termination of the Employee's employment with the Employer (the
“Non-Solicitation Period”), Employee will not, directly or indirectly, solicit
or induce, or attempt to solicit or induce: (i) any employee of the Employer to
terminate employment with the Employer; or (ii) any customer of the Employer and
its subsidiaries and affiliates to terminate its relationship with the Employer
or its subsidiaries and affiliates (the “Non-Solicitation Covenant”). If the
Employee violates the Non-Solicitation Covenant and the Employer brings legal
action for injunctive or other relief, the Employer shall not, as a result of
the time involved in obtaining such relief, be deprived of the benefit of the
full period of the Non-Solicitation Covenant. Accordingly, the Non-Solicitation
Covenant shall be deemed to have the duration specified in this Section computed
from the date the relief is granted but reduced by the time between the period
when the Non-Solicitation Period began to run and the date of the first
violation of the Non-Solicitation Covenant by the Employee.

 

(b)     Remedies for Breach of Non-Solicitation Covenant. The Employee
acknowledges that the restrictions contained in this Section 10 and Section 9
are reasonable and necessary for the protection of the legitimate business
interests of the Employer, that any violation of these restrictions would cause
substantial injury to the Employer and such interests, that the Employer would
not have entered into this Agreement with the Employee without receiving the
additional consideration offered by the Employee in binding himself to these
restrictions and that such restrictions were a material inducement to the
Employer to enter into this Agreement. In the event of any violation or
threatened violation of these restrictions, the Employer, in addition to and not
in limitation of, any other rights, remedies or damages available to the
Employer under this Agreement or otherwise at law or in equity, shall be
entitled to preliminary and permanent injunctive relief to prevent or restrain
any such violation by the Employee and any and all persons directly or
indirectly acting for or with Employee, as the case may be.

  

 
 

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Section 11.     Severance.

 

(a)     Termination Without Cause. If the Employee is terminated without “Cause”
(as defined below), the Employer will pay the Employee a sum equal to the sum of
(i) twelve (12) months of Base Salary. Such payment shall be made in a lump sum
within 15 days of termination or in equal installments over the six-month (6)
period, at the Employer's option.

 

(b)     Termination for Cause or Voluntary Termination. If the Employee is
terminated for Cause (as defined below) or voluntarily terminates Employee’s
employment, then the Employer shall pay Employee any accrued and unpaid Base
Salary, and any accrued and unpaid personal days and shall have no further
obligations to the Employee under this Agreement. For purposes of this
Agreement, “Cause” shall mean:

 

(i)     the Employee's death;

 

(ii)     a material violation by the Employee of any applicable material law or
regulation respecting the business of the Employer or its subsidiaries;

 

(iii)     the Employee being found guilty of a felony, an act of dishonesty in
connection with the performance of Employee’s duties as an officer of the
Employer, or which disqualifies the Employee from serving as an officer of the
Employer; or

 

(iv)     the willful or negligent failure of the Employee to perform Employee’s
duties hereunder in any material respect.

 

Whether Cause exists shall be determined as follows: (y) if Douglas M. Hultquist
is then an executive with the Employer, then if he shall determine that Cause
exists, the Cause shall exist; and (z) if Douglas M. Hultquist is not an
executive with the Employer at such time, then Cause shall be determined in the
discretion of the Board of Directors of the Employer.

 

(c)     Termination Upon Change in Control. If a Change in Control (as defined
below) occurs and the Employee is terminated within one (1) year following the
Change in Control or the Employee suffers a Change in Duties (as defined below)
and elects to terminate Employee’s employment within six (6) months following
the Change in Control, a severance payment will be made within 15 days of
termination equal to the sum of eighteen months (18) of Base Salary and
Employee’s Average Annual Bonus. In addition, the Employer shall continue, or
cause to be continued, Employee’s health insurance as in effect on the date of
termination (including, if applicable, family coverage) for twelve months (12).

 

For purposes of this paragraph, the term “Change in Duties” shall mean any one
or more of the following events that occurs after a Change in Control:

 

(i)     a significant change in the nature or scope of Employee’s authority or
duties from those applicable to Employee immediately prior to the date on which
a Change in Control occurs;

  

 
 

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(ii)     a reduction of more than ten percent (10%) in Employee’s annual Base
Salary from that provided to Employee immediately prior to the date on which a
Change in Control occurs;

 

(iii)     Employee’s eligibility to participate, and participation, in bonus,
stock option, incentive award and other compensation plans that provide
opportunities to receive compensation are not the same or greater than that of
executives of any successor of the Employer (including its affiliates) with
comparable duties to those of Employee; or

 

(iv)     a change, without Employee’s written agreement, in the location of
Employee’s principal place of employment with the Employer by more than
thirty-five (35) miles from the location where Employee was principally employed
immediately prior to the date on which a Change in Control occurs.

 

For purposes of this paragraph, the term “Change in Control” shall mean the
following:

 

(i)     The consummation of the acquisition by any person (as such term is
defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the 1934 Act) of thirty-three percent (33%) or more of
the combined voting power of the then outstanding voting securities of the
Employer; or

 

(ii)     The individuals who, as of the date hereof, are members of the Board
cease for any reason to constitute a majority of the Board, unless the election,
or nomination for election by the stockholders, of any new director was approved
by a vote of a majority of the Board, and such new director shall, for purposes
of this Agreement, be considered as a member of the Board; or

 

(iii)     Consummation by the Employer of (i) a merger or consolidation if the
stockholders, immediately before such merger or consolidation, do not, as a
result of such merger or consolidation, own, directly or indirectly, more than
sixty-seven percent (67%) of the combined voting power of the then outstanding
voting securities of the entity resulting from such merger or consolidation, in
substantially the same proportion as their ownership of the combined voting
power of the voting securities of the Employer outstanding immediately before
such merger or consolidation or (ii) a complete liquidation or dissolution or an
agreement for the sale or other disposition of two-thirds or more of the
consolidated assets of the Employer.

 

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because thirty-three percent (33%) or more of the combined voting power
of the then outstanding securities of the Employer is acquired by (i) a trustee
or other fiduciary holding securities under one or more employee benefit plans
maintained for employees of the entity or (ii) any corporation which,
immediately prior to such acquisition, is owned directly or indirectly by the
stockholders of the Employer in substantially the same proportion as their
ownership of stock of the Employer immediately prior to such acquisition.

  

 
 

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(iv)     If the Employer is not in compliance with its minimum capital
requirements or if the payments required under this Section 9 would cause the
Employer's capital to be reduced below its minimum capital requirements, such
payments shall be deferred until such time as the Employer is in capital
compliance. At the election of the Employee, which election is to made within
thirty (30) days of the Employee's termination, such payments shall be made in a
lump sum or paid monthly during the remaining term of this Agreement following
the Employee's termination. In the event that no election is made, payment to
the Employee will be made on a monthly basis during the remaining term of this
Agreement. Such payments shall not be reduced in the event the Employee obtains
other employment following the termination of employment by the Employer.

 

Section 12.     Regulatory Suspension and Termination.

 

(a)     If the Employee is suspended from office and/or temporarily prohibited
from participating in the conduct of the Employer’s affairs by a notice served
under Section 8(e)(3) (12 U.S.C. § 1818(e)(3)) or 8(g) (12 U.S.C. § 1818(g)) of
the Federal Deposit Insurance Act, as amended, the Employer’s obligations under
this contract shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the
Employer shall (A) pay the Employee all of the compensation withheld while their
contract obligations were suspended and (B) reinstate any of the obligations,
which were suspended.

 

(b)     If the Employee is removed and/or permanently prohibited from
participating in the conduct of the Employer’s affairs by an order issued under
Section 8(e) (12 U.S.C. § 1818(e)) or 8(g) (12 U.S.C. § 1818(g)) of the Federal
Deposit Insurance Act, as amended, all obligations of the Employer under this
contract shall terminate as of the effective date of the order, but vested
rights of the contracting parties shall not be affected.

 

(c)     If the Employer is in default as defined in Section 3(x) (12 U.S.C. §
1813(x)(1)) of the Federal Deposit Insurance Act, as amended, all obligations of
the Employer under this contract shall terminate as of the date of default, but
this paragraph shall not affect any vested rights of the contracting parties.

 

(d)     All obligations of the Employer under this contract shall be terminated,
except to the extent determined that continuation of the contract is necessary
for the continued operation of the institution by the Federal Deposit Insurance
Corporation (the “FDIC”), at the time the FDIC enters into an agreement to
provide assistance to or on behalf of the Employer under the authority contained
in Section 13(c) (12 U.S.C. § 1823(c)) of the Federal Deposit Insurance Act, as
amended, or when the Employer is determined by the FDIC to be in an unsafe or
unsound condition. Any rights of the parties that have already vested, however,
shall not be affected by such action.

 

(e)     Any payments made to the Employee pursuant to this Agreement, or
otherwise, are subject to and conditioned upon their compliance with Section
18(k) (12 U.S.C. § 1828(k)) of the Federal Deposit Insurance Act as amended, and
any regulations promulgated thereunder.

 

Section 13.     General Provisions.

 

(a)     This Agreement supersedes all prior agreements and understandings
between the parties relating to the subject matter of this Agreement. It binds
and benefits the parties and their successors in interest, heirs, beneficiaries,
legal representatives and assigns. The Employer agrees that it shall not merge
or consolidate into or with another company, or reorganize, or sell
substantially all its assets to another company, firm or person unless such
succeeding or continuing company, firm or person agrees to assume and discharge
the obligations of the Employer under this Agreement.

  

 
 

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(b)     This Agreement is governed by and construed in accordance with the laws
of the State of Iowa.

 

(c)     The provisions of Sections 9 and 10 shall survive the termination of
this Agreement.

 

(d)     No amendment or modification of this Agreement is effective unless made
in writing and signed by each party.

 

(e)     This Agreement may be signed in several counterparts, each of which will
be an original and all of which will constitute one agreement.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above set forth.

 

 

QCR HOLDINGS, INC. 

 

 

 

 

 

 

 

 

 

 

By: 

/s/ Douglas M. Hultquist 

 

/s/ Cathie Whiteside 

 

Douglas M. Hultquist 

 

Cathie Whiteside 

 

President