Exhibit 10.21

 

SEPARATION AGREEMENT

 

August 27, 2003
Revised September 5, 2003

 

Dean D. Kling
89 29th Ave. N.
Fargo, ND  58102

 

Dear Dean:

 

This letter describes our agreement regarding the resignation of your position
from Community First Bankshares, Inc. (“CFB”) effective September 30, 2003.  If
after reading this letter you feel there is any discrepancy between our
conversations and the contents of this letter, please contact me.

 

Although not obligated to do so, we have offered to provide you with the
following benefits in conjunction with your departure from CFB:

 

1.                                       WE WILL PAY YOU YOUR REGULAR SALARY,
WHICH THE ANNUALIZED AMOUNT IS $170,000, THROUGH SEPTEMBER 30, 2003.  PLEASE
COORDINATE YOUR SCHEDULE WITH YOUR SUPERVISOR DURING THIS TIME.  IT IS AGREED
THAT YOU WILL VACATE COMMUNITY FIRST BANKSHARES PREMISES AND RETURN YOUR
COMMUNITY FIRST BANKSHARES PROPERTY BY THE CLOSE OF BUSINESS ON AUGUST 29, 2003.

 

2.                                       WE WILL PAY YOU SEPARATION PAY AT YOUR
REGULAR SALARY, AT REGULAR PAYROLL DATES FROM OCTOBER 1, 2003 THROUGH SEPTEMBER
30, 2004.  IF YOU ENTER INTO “REGULAR FULL-TIME EMPLOYMENT”(1), YOU MUST NOTIFY
US PROMPTLY.  ALL SEPARATION PAY PAYMENTS WILL CEASE FOLLOWING YOUR FIRST FULL
MONTH OF EMPLOYMENT.  AT THAT TIME, YOU WILL BE ENTITLED TO A LUMP SUM PAYMENT
OF 50 PERCENT OF THE AMOUNT OF ANY REMAINING PAYMENTS.  IF YOU ENTER INTO
REGULAR FULL-TIME EMPLOYMENT, AS A SENIOR MANAGEMENT LEVEL POSITION WITH A
FINANCIAL SERVICES ORGANIZATION THAT IS CONSIDERED TO BE A MAJOR AND DIRECT
COMPETITOR OF COMMUNITY FIRST, ALL PAYMENTS HEREUNDER SHALL CEASE.

 

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(1)          THE TERM “REGULAR FULL-TIME EMPLOYMENT” SHALL NOT MEAN TEMPORARY,
CASUAL OR “HOBBY” TYPE EMPLOYMENT WITH A DURATION OF LESS THAN ONE (1) MONTH.

 

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3.                                       WE WILL PAY YOU FOR ANY UNUSED ACCRUED
PTO AS OF SEPTEMBER 30, 2003.  THIS AMOUNT IS SHOWN ON YOUR PAY STUB AND WILL
ACCRUE PER COMMUNITY FIRST BANKSHARES POLICIES UNTIL SEPTEMBER 30, 2003.

 

4.                                       WE WILL PAY YOU ANY BONUS/INCENTIVE
AMOUNT ACCORDING TO THE TERMS OF THE CORPORATE ANNUAL INCENTIVE PLAN (AIP)
PRO-RATED FOR YOUR 2003 EMPLOYMENT DATES.  SUCH AMOUNTS, IF ANY, WOULD NOT BE
EXPECTED TO BE DETERMINED UNTIL FEBRUARY 2004 WITH PAYOUT, IF ANY, MADE IN MARCH
2004.

 

5.                                       WE WILL PAY UP TO $5,000 FOR OUR
PLACEMENT SERVICES TO DRAKE BEAM MORIN COMPANY.  FOR USE OF THE PROGRAM PLEASE
CONTACT MICHELLE KOMMER AT 701/298-5652.

 

•                                          After your termination of employment,
you and/or your covered dependents may be eligible to continue your health,
dental, vision, medical reimbursement flexible spending account coverage under
COBRA.  COBRA information will be sent under separate cover.

•                                          Basic life coverage will cease on the
last day of the month during which you were last actively at work.  You may
convert this insurance by applying and paying the first premium for an
individual policy within 31 days after any part of your insurance stops. 
Contact Human Resources or ReliaStar within 31 days, if you are interested.

•                                          Optional life coverage will cease on
the last day of the month during which you were last actively at work.

•                                          Long term disability coverage stops
when you are no longer actively at work.  You may convert this insurance if your
employment ends for a reason other than retirement or if you are no longer in an
eligible status.  You must apply and pay the first premium for a LTD policy
within 31 days after your insurance stops.  Contact Human Resources or
ReliaStar, if you are interested.

•                                          If you are a 401(k) Retirement Plan
participant, distribution papers will be sent to you under separate cover upon
your termination.  You must receive a distribution of your vested plan account
balance if this amount is $5,000 or less.  If your vested plan account balance
exceeds $5,000, you may request a distribution now or leave the balance in the
plan until you later request distribution.  Please allow four to six weeks
processing time after the paperwork is received in the Trust Department.  Please
refer to your 401(k) Retirement Plan information regarding possible tax
consequences associated with a distribution.  The plan indicates that you must
be an active employee on the last day of the plan year (12/31) to receive a
matching contribution.

 

6.                                       WE WILL PAY YOU SIXTY FIVE PERCENT
(65%) OF ANY COMMUNITY FIRST BANKSHARES HEALTH/DENTAL/VISION COBRA PREMIUM YOU
INCUR ACCORDING TO THE TERMS OF THOSE BENEFIT PLANS FOR THE PERIOD YOU ARE
RECEIVING SEPARATION PAY DELINEATED IN PARAGRAPH #2 ABOVE.

 

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7.                                       WE WILL PAY YOU A SPECIFIC SEPARATION
PAYMENT AS ADDITIONAL CONSIDERATION FOR ENTERING INTO THIS AGREEMENT IN THE
AMOUNT OF $5,737.50.

 

8.                                       YOU WILL BE ALLOWED TO EXERCISE ANY
VESTED, UNEXERCISED STOCK OPTIONS UNDER THE CFB INCENTIVE STOCK OPTION PLAN
WITHIN 30 DAYS OF THE DATE OF YOUR POSITION RESIGNATION.  NO FURTHER VESTING OF
ANY UNEXERCISED STOCK OPTIONS WILL OCCUR AFTER THE DATE OF YOUR POSITION
RESIGNATION.  PLEASE CONTACT GALE SKARPOHL AT 701/298-5625 WITH ANY QUESTIONS
YOU MAY HAVE.

 

9.                                       WE ARE PROVIDING YOU WITH THE
OPPORTUNITY TO VOLUNTARILY RESIGN YOUR EMPLOYMENT.  I WILL DISCUSS WITH YOU
MUTUALLY AGREEABLE LANGUAGE TO BE COMMUNICATED PUBLICLY REGARDING YOUR
RESIGNATION.  IF ANY PROSPECTIVE EMPLOYER OF YOURS WISHES TO CONTACT CFB FOR
EMPLOYMENT INFORMATION, YOU AGREE TO DIRECT ALL SUCH PROSPECTIVE EMPLOYERS TO
MAKE A WRITTEN REQUEST ONLY TO CFB’S HUMAN RESOURCES MANAGER, WHO WILL PROVIDE
THE PROSPECTIVE EMPLOYER ONLY WITH YOUR DATES OF EMPLOYMENT, THE NATURE OF THE
POSITION YOU HELD WITH CFB AND THE FACT THAT YOU VOLUNTARILY RESIGNED YOUR
EMPLOYMENT WITH CFB.  NO REFERENCE WILL BE MADE TO THE CIRCUMSTANCES SURROUNDING
YOUR RESIGNATION.

 

10.                                 WE HAVE DISCUSSED AND AGREED ON MUTUALLY
AGREEABLE LANGUAGE TO BE COMMUNICATED PUBLICLY REGARDING YOUR POSITION
RESIGNATION.

 

11.                                 WE WILL NOT DISPUTE OR CONTEST ANY CLAIM
WHICH YOU MIGHT MAKE FOR UNEMPLOYMENT BENEFITS UNLESS WE DISAGREE WITH THE
REASONS FOR WHICH SAID CLAIM IS BEING MADE OR YOU ARE UNAVAILABLE FOR
EMPLOYMENT.  ADDITIONALLY, WE WILL COOPERATE WITH YOU IF NECESSARY, IN INFORMING
THE UNEMPLOYMENT COMPENSATION BENEFITS OFFICE THAT YOUR POSITION RESIGNATION WAS
BASED ON YOUR EMPLOYER’S DECISION.

 

In consideration for the benefits outlined above, you agree to the following
things:

 

1.                                       YOU AGREE TO RESIGN YOUR POSITION WITH
CFB.

 

2.                                       YOU HEREBY RELEASE COMMUNITY FIRST
BANKSHARES, INC., ITS AFFILIATES, ITS AND THEIR PAST AND PRESENT OFFICERS,
DIRECTORS, AGENTS, SHAREHOLDERS, EMPLOYEES, ATTORNEYS, INSURERS AND INDEMNITORS
(COLLECTIVELY, THE “RELEASEES”) FROM ANY AND ALL CLAIMS AND CAUSES OF ACTION,
KNOWN AND UNKNOWN, WHICH YOU MAY HAVE AGAINST ANY AND ALL OF THEM.  THROUGH THIS
RELEASE, YOU EXTINGUISH ALL CAUSES OF ACTION, KNOWN AND UNKNOWN, AGAINST THE
RELEASEES OCCURRING UP TO THE DATE OF THIS AGREEMENT, INCLUDING BUT NOT LIMITED
TO ANY CONTRACT, WAGE OR BENEFIT CLAIMS; INTENTIONAL INFLICTION OF EMOTIONAL
DISTRESS, DEFAMATION OR ANY OTHER TORT CLAIMS; AND ALL CLAIMS ARISING FROM ANY
FEDERAL, STATE OR MUNICIPAL LAW OR ORDINANCE.  THIS RELEASE EXTINGUISHES ANY
POTENTIAL CLAIMS, INCLUDING EMPLOYMENT DISCRIMINATION CLAIMS, ARISING FROM YOUR
EMPLOYMENT WITH AND POSITION RESIGNATION FROM CFB, INCLUDING SPECIFICALLY ANY
CLAIMS UNDER THE NORTH DAKOTA HUMAN RIGHTS ACT, THE AMERICANS WITH DISABILITIES
ACT, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AGE DISCRIMINATION IN EMPLOYMENT
ACT, AND THE FAIR LABOR STANDARDS ACT.  THIS RELEASE DOES NOT EXTINGUISH ANY

 

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CLAIMS OR CAUSES OF ACTION ARISING FROM BREACH OF THIS SEPARATION AGREEMENT. 
YOU MAY REVIEW THIS AGREEMENT WITH AN ATTORNEY OF YOUR CHOOSING.  YOU HAVE 45
DAYS FROM THE DATE YOU RECEIVE THIS SEPARATION AGREEMENT AND RELEASE TO CONSIDER
WHETHER YOU WISH TO SIGN IT.  YOU ACKNOWLEDGE THAT IF YOU SIGN THIS AGREEMENT
BEFORE THE END OF THIS PERIOD, IT IS YOUR VOLUNTARY DECISION TO DO SO, AND YOU
WAIVE THE REMAINDER OF THE PERIOD.

 

3.                                       IN ADDITION, MARK ANDERSON AND RON
STRAND HAVE AGREED TO BE NAMED AND CONTACTED AS REFERENCES.  THEY WOULD AFFIRM
THAT YOUR SEPARATION WAS DUE TO POSITION ELIMINATION AND NOTE THE
ACCOMPLISHMENTS IN OUR GROUP F/K/A FINANCIAL SERVICES GROUP DURING YOUR TENURE
WITH COMMUNITY FIRST BANKSHARES.

 

4.                                       YOU ARE HEREBY NOTIFIED OF YOUR RIGHT
TO RESCIND THE RELEASE OF CLAIMS CONTAINED IN THE ABOVE PARAGRAPH WITH REGARD TO
CLAIMS ARISING UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT (ADEA) WITHIN
SEVEN (7) CALENDAR DAYS.  IN ORDER TO BE EFFECTIVE, THE RESCISSION MUST

 

A.                                       BE IN WRITING; AND

 

B.                                      DELIVERED TO THE UNDERSIGNED DESIGNATED
OFFICIAL BY HAND OR MAIL WITHIN THE REQUIRED PERIOD; AND

 

C.                                       IF DELIVERED BY MAIL, THE RESCISSION
MUST BE POSTMARKED WITHIN THE REQUIRED PERIOD, PROPERLY ADDRESSED TO THE
UNDERSIGNED OFFICIAL AND SENT BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED.

 

This Agreement will be effective upon the expiration of the 7 day period without
rescission.  You understand that if you rescind this Agreement in accordance
with this paragraph, you will not receive the payments described herein and you
will be obligated to return any and all payments already received.

 

If you violate any term of this agreement while you are still receiving benefits
hereunder, payments and provision of all remaining benefits to you hereunder
will immediately cease and your obligations hereunder shall remain in effect in
consideration of all the benefits which you will have received prior to said
violation by you.

 

5.                                       YOU CERTIFY THAT YOU HAVE RETURNED ALL
CFB PROPERTY IN YOUR POSSESSION AND ALL COPIES THEREOF, INCLUDING BUT NOT
LIMITED TO ALL KEYS, EQUIPMENT, PROPRIETARY TECHNOLOGY, ALL COMPANY DOCUMENTS OR
COMPUTERIZED TRANSACTIONS THEREOF, INCLUDING ANY CFB CONFIDENTIAL INFORMATION AS
DEFINED IN PARAGRAPH 4 BELOW, AND ANY OTHER PROPERTY IN YOUR POSSESSION
BELONGING TO CFB.

 

6.                                       EFFECTIVE UPON THE EXECUTION OF THIS
AGREEMENT BY BOTH PARTIES, YOU AGREE THAT YOU WILL NOT DIVULGE, COMMUNICATE OR
USE FOR YOUR BENEFIT OR THE BENEFIT OF ANY PERSON OUTSIDE CFB ANY OF CFB’S
CONFIDENTIAL INFORMATION.  CONFIDENTIAL INFORMATION INCLUDES BUT IS NOT

 

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LIMITED TO CFB’S TRADE SECRETS, RECORDS, DATA, CUSTOMER AND PROSPECTIVE CUSTOMER
LISTS AND INFORMATION, SHORT TERM AND LONG RANGE PLANS, ALL FINANCIAL
INFORMATION, INCLUDING SALES, SPECIFIC CUSTOMER ACCOUNT SALES, GROSS MARGIN
INFORMATION, OPERATING EXPENSE AND INFORMATION, COMPETITIVE STRATEGIES AND
PRICING INFORMATION, PROCUREMENT RESOURCES INFORMATION CONCERNING CFB’S BUSINESS
OR ITS MANNER OF OPERATION, PERSONNEL INFORMATION, SALES AND MARKETING
STRATEGIES AND INFORMATION, AND ANY OTHER CONFIDENTIAL OR TECHNICAL INFORMATION
WHICH YOU HAVE OBTAINED DURING YOUR EMPLOYMENT WITH CFB.  CONFIDENTIAL
INFORMATION SHALL MEAN INFORMATION NOT GENERALLY KNOWN IN THE BUSINESS COMMUNITY
THAT HAS BEEN DISCLOSED TO YOU AND IS KNOWN TO YOU AS A CONSEQUENCE OF YOUR
EMPLOYMENT BY CFB.  YOU WILL NOT DISCLOSE ANY SUCH INFORMATION TO ANY PERSON,
FIRM, CORPORATION, ASSOCIATION OR OTHER ENTITY FOR ANY REASON WHATSOEVER. 
CONFIDENTIAL INFORMATION ALSO INCLUDES THE TERMS AND EXISTENCE OF THIS
AGREEMENT, WHICH MAY BE DISCLOSED BY YOU ONLY TO YOUR IMMEDIATE FAMILY, ATTORNEY
OR TAX ADVISOR, EXCEPT AS OTHERWISE REQUIRED BY COURT ORDER.  THIS AGREEMENT AND
THIS AGREEMENT ONLY (NOT ANY TRADE SECRET ET AL INFORMATION) CAN BE DISCLOSED TO
YOUR BANKER.

 

7.                                       EFFECTIVE UPON EXECUTION OF THIS
AGREEMENT BY BOTH PARTIES, YOU AGREE NOT TO MAKE, EITHER DIRECTLY OR INDIRECTLY,
ANY DEROGATORY OR NEGATIVE COMMENTS OF ANY KIND, EITHER ORAL OR WRITTEN, TO ANY
PERSON OR ORGANIZATION ABOUT CFB OR ANY OFFICER, DIRECTOR, SHAREHOLDER, EMPLOYEE
OR ANY OTHER PERSON AFFILIATED WITH CFB WHICH WOULD IN ANY WAY INTERFERE WITH
ANY OF CFB’S BUSINESS RELATIONSHIPS.

 

8.                                       AT CFB’S REQUEST, YOU AGREE TO
COOPERATE WITH CFB IN ANY CURRENT OR FUTURE CLAIMS OR LAWSUITS INVOLVING CFB
WHERE YOU HAVE KNOWLEDGE OF THE UNDERLYING FACTS.  IN ADDITION, YOU AGREE THAT
YOU WILL NOT VOLUNTARILY AID, ASSIST, OR COOPERATE WITH ANY CLAIMANTS OR
PLAINTIFFS OR THEIR ATTORNEYS OR AGENTS IN ANY CLAIMS OR LAWSUITS COMMENCED IN
THE FUTURE AGAINST CFB, PROVIDED, HOWEVER, THAT NOTHING IN THIS AGREEMENT WILL
BE CONSTRUED TO PREVENT YOU FROM TESTIFYING TRUTHFULLY PURSUANT TO A COURT
ORDER.

 

9.                                       YOU AGREE TO MAKE YOURSELF AVAILABLE TO
ME, AT MY REASONABLE REQUEST, TO ASSIST WITH ANY TRANSITIONAL CONSULTING DUTIES
ASSOCIATED WITH YOUR CURRENT RESPONSIBILITIES.

 

This Agreement shall not in any way be construed as an admission of liability by
CFB or as an admission that CFB has acted wrongfully with respect to you.  CFB
specifically denies and disclaims any such liability or wrongful acts.

 

This agreement sets forth our entire agreement and fully supersedes any prior
agreements or understandings between you and CFB.  CFB asks that our records
reflect that you conclude your employment on terms you understand and accept. 
Therefore, we ask you to declare that you have entered into this agreement
voluntarily, without coercion or duress, and with the opportunity to review its
contents with legal counsel should you desire.

 

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If this letter accurately reflects our understanding and agreement, please sign
the original and copy and return the original to me.  The copy is for your file.

 

Sincerely,

 

/s/ Thomas R. Anderson

 

 

COMMUNITY FIRST BANKSHARES, Inc.

Thomas R. Anderson

EVP – Chief Investment Officer

 

 

Read and agreed to, with declarations

confirmed, this 5th day of September, 2003.

 

 

  /s/ Dean D. Kling

 

Dean D. Kling

 

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