Exhibit 10.8

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of
November 23, 2013 by and between Gary M. Jewell, a resident of the State of
Maryland (“Employee”), and Bay Bank, FSB, a federally chartered savings bank
(“Employer”).  The Employee and Employer are each sometimes referred to herein
as a “Party” and are collectively sometimes referred to herein as the
“Parties”. 

WITNESSETH

 

WHEREAS, Employee is employed by Employer, as evidenced by an Amended and
Restated Employment Agreement, dated as of June 8, 2010, and the term of such
employment is scheduled to expire on December 31, 2013.

 

WHEREAS, Employer desires to continue Employee’s employment after such
expiration, and Employee desires to remain so employed, subject to the terms and
conditions contained in this Agreement.

 

NOW, THEREFORE, in consideration of the continued employment of Employee by
Employer and of the Parties’ promises and covenants contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties, intending to be legally bound, agree as
follows:

A G R E E M E N T

1. Employment and Duties.  Employer hereby employs Employee to serve as
Executive Vice President – Electronic Banking of Employer.  In such capacity,
during the Term (as defined in Section 2 hereof), the Employee shall report
directly to the Chief Executive Officer (“CEO”) of Employer or such other
Employer -affiliated individual(s) as may be designed by the CEO and/or the
Employer’s Board of Directors (the CEO and any such designated individuals, the
“Designated Officers”), and shall perform such duties as may be assigned to him
from time to time by the Designated Officers and/or the Employer’s Board of
Directors (collectively, “Duties”).  Initially, the Duties shall include
Employee’s management of the Employer’s Point-of-Sale Sponsorship business,
debit card services, automatic teller machine (“ATM”) network, on-line banking,
information technology and facilities, and providing leadership, training and
supervision with respect thereto.  During the Term, Employee will devote his
full time and effort to performing the Duties at one of the following locations,
as specified by the Employer from time to time: (a) 2328 West Joppa Road,
Lutherville, Maryland 20193; (b) 7151 Columbia Gateway Drive, Columbia, Maryland
21046; or (c) such other office as Employer may establish from time to time
(each, an “Employment Location”).    Within three (3) months of the Commencement
Date (as defined in Section 2 hereof), Employee shall identify in writing to the
CEO an individual who he believes should be hired by Employer to work under
Employee as part of a succession plan for the Point-of-Sale Sponsorship business
(a “Successor”).  If and when Employer hires a Successor, Employee shall mentor
the Successor and otherwise use his good faith best efforts to ensure that the
Successor will be in a position to succeed the Employee. 

2. Term.  The term of Employee’s employment under this Agreement shall commence
on January 1, 2014 (the “Commencement Date”) and, subject to Section 12 and

 

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Section 15(k) hereof, shall expire on December 31, 2014 (the “Initial
Term”).  After the expiration of the Initial Term, Employee’s term of employment
under this Agreement shall be renewed for successive one-year periods (each, a
“Renewal Term”; the Initial Term and each Renewal Term are each sometimes
referred to herein as a “Term”) without further action by the Parties, unless
either Party has provided the other Party with written notice at least 90 days
prior to the commencement of a Renewal Term of such Party’s decision not to
renew Employee’s employment under this Agreement for such Renewal Term. 

3. Compensation.  As compensation for all services to be rendered by Employee
during the Term pursuant to this Agreement, Employer shall pay Employee an
annual base salary (“Base Salary”) and such other amounts as are set forth in,
and in accordance with, Exhibit A hereto, which is incorporated herein by
reference, net of applicable withholdings.  The Base Salary shall be paid in
semi-monthly installments or such other compensation payment schedule as may be
adopted by Employer for its full time Employees.

4. Expenses.  As long as Employee is employed hereunder, Employee is entitled to
receive reimbursement for, or seek payment directly by Employer of, all
reasonable expenses that Employee incurs in the performance of his duties
hereunder and that are consistent with Employer’s expense policy then in effect,
provided that Employee accounts for such expenses in writing.

5. Employee Benefits.      As long as Employee is employed hereunder, Employee
shall be entitled to participate in the various employee benefit programs
adopted by Employer from time to time that are available generally to executive
officers of the Employer.

6. Vacation.  During his term of employment under this Agreement, Employee shall
be entitled to vacation/leave as outlined in Exhibit A.

7. Confidentiality.  In Employee’s position as an employee of Employer, Employee
has had and will have access to Confidential Information, Trade Secrets and
other proprietary information of vital importance to Employer and has and will
also develop relationships with customers, employees and others who deal with
Employer which are of value to Employer. Employee agrees and acknowledges that
Employer may entrust Employee with highly sensitive, confidential, restricted
and proprietary information, including, without limitation, Trade Secrets,
Confidential Information, customer lists, and information concerning Business
Opportunities and personnel matters (the “Protected Information”). Employee
acknowledges that he shall bear a fiduciary responsibility to Employer, both
during and after his term of employment with Employer, to protect the Protected
Information from unauthorized use or disclosure, and he agrees that he will not
use or disclose Protected Information unless authorized by Employer and except
as may be necessary for him to perform the Duties.

(a) As used in this Agreement:

(i) “Trade Secret” shall mean the identity and addresses of customers of
Employer and any other information, without regard to form, including, but not
limited to, any technical or nontechnical data, any formula, pattern,
compilation, program, device, method, technique, drawing, process, financial
data, financial plans, and product plans, that (A) is valuable and secret (in
the sense that it is not generally known by or available to competitors of

 

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Employer) and (B) otherwise qualifies as a “trade secret” under Maryland law
pursuant to the Maryland Trade Secrets Act of 1990, as amended.

(ii) “Confidential Information” shall mean all “non-public Personal
Information,” as defined in Title V of The Gramm-Leach-Bliley Act (15 U.S.C. §§
680 et seq.) and its implementing regulations (collectively, the “GLB Act”) that
concerns any of the Employer’s “customers and/or consumers”, as defined by the
GLB Act, and any data or information, other than Trade Secrets, which is
material to Employer and not generally known by or available to the public.
Confidential Information shall include, but not be limited to, Business
Opportunities (as hereinafter defined) of Employer, the details of this
Agreement, Employer’s business plans and financial statements and projections,
information as to the capabilities of Employer’s employees, their respective
salaries and benefits and any other terms of their employment and the costs of
the services Employer may offer or provide to the customers it serves, and any
list of actual or potential customers, to the extent such information is
material to Employer and not generally known by or available to the public.

(iii) “Business Opportunities” shall mean any specialized information or plans
of Employer not disclosed or available to the public concerning the provision of
financial services to a Person, together with all related information concerning
the specifics of any contemplated financial services regardless of whether
Employer has contacted or communicated with such Person. 

(iv) “Person” shall mean any individual, corporation, partnership, limited
liability company, joint venture, trust, unincorporated organization, any other
legal or commercial entity, or two or more of any of the foregoing having a
joint or common interest.

(v) “Affiliate”, with respect to a specified Person, shall mean a Person that
directly, or indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, the specified Person.

(b) Notwithstanding the definitions of Trade Secrets, Confidential Information,
and Business Opportunities set forth in Section 7(a) of this Agreement, the
terms Trade Secrets, Confidential Information and Business Opportunities shall
not include any information:

(i) that is or becomes generally available to the public other than as a result
of disclosure by the Employee in violation of this Agreement;

(ii) that was already known by Employee prior to the date he was first employed
by Employer or its or that is developed by Employee after the termination of his
employment with Employer through entirely independent efforts;

(iii) that Employee obtains on a non-confidential basis from a source other than
Employer or its Affiliates so long as such source is not bound by a
confidentiality agreement with, or other contractual, legal, or fiduciary
obligation of secrecy or confidentiality to, Employer or any other Person with
respect to such information

(iv) that is required to be disclosed by law, except to the extent eligible for
special treatment under an appropriate protective order; or

 

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(v) that Employer’s Board of Directors approves for release.

8. Observance of Security Measures.  During Employee’s employment with Employer,
Employee shall observe all security measures adopted by Employer to protect
Protected Information.

9. Covenants to Protect the Company’s Business.  As used in this Section 9, the
term “Employer” means, individually and collectively, Bay Bank, F.S.B. and its
Affiliates.

(a) During the term of the Employee’s employment with Employer and thereafter
for a period of one (1) year from the date on which Employee’s employment with
Employer is terminated (the “Restricted Period”), Employee shall not, directly
or indirectly, as owner, partner, director, officer, employee, agent,
consultant, advisor, contractor or otherwise, whether for consideration or
without consideration, for the benefit of any Person other than Employer, take
any of the following actions:

(i) Compete with Employer’s Point-of-Sale Sponsorship business or otherwise
engage in the sale of any products or the performance of any services which are
the same as or substantially similar to, or which are intended to substitute
for, products or services offered or provided during the Term by Employer
pursuant to its Point-of-Sale Sponsorship business (the “Competing Products”)
anywhere in the United States of America; provided,  however, that the ownership
by the Employee of up to a five percent (5%) interest in the securities of a
Person that are registered under Section 12 of the Securities Exchange Act of
1934, as amended (the “Exchange Act”), shall not constitute a breach of this
Section 9(a); 

(ii) Solicit any Business Relation (as hereinafter defined) to purchase, or sell
or otherwise provide to any Business Relation, any Competing Products;

(iii) Employ, engage or solicit for employment or for engagement as an
independent contractor or consultant, any Person who was employed by, or any
Person who was engaged as an independent contractor by, Employer within the
12-month period immediately preceding any employment, engagement, or
solicitation by the Employer; urge any such Person to reduce his or her
employment with or provision of services to Employer or assist any such Person
with any such reduction; or arrange to have any other Person employ or engage
such Person; or

(iv) Urge any Person to reduce its business with Employer or assist any Person
with any such reduction; provided, however, that a general solicitation through
a public medium not specifically directed toward any Person shall not be
considered a breach of this Section 9(a).

(b) As used in this Agreement, the term “Business Relation” shall mean any
Person other than Employer who, at any time during the Employee’s term of
employment with Employer, was a Person (i) who is or was a customer of Employer
or a prospective customer of Employer, or (ii) who had entered into any contract
or other arrangement with Employer for the provision of services or the sale of
products, or (iii) to whom Employer had furnished or planned to furnish a
proposal for the performance of services or the sale of products, or (iv) with
whom Employer entered or agreed to enter into any other business relationship
such as a joint venture,

 

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collaborative agreement, joint development agreement, teaming arrangement or
agreement, or similar arrangement or understanding for the provision of services
or sale of products.

(c) During the Restricted Period, except as required by applicable law or the
rules or regulations of any governmental or self-regulatory organization having
jurisdiction over Employer and/or Employee, Employee will not make any
statements or comments of a disparaging nature to any Person regarding Employer
or its stockholders, directors, officers, personnel, products or services. 

(d) Employee hereby acknowledges and agrees that the restrictions contained in
this Section 9 regarding geographical scope, length of term and types of
activities restricted are reasonable. 

10. Return of Materials; No Access. Upon the request of Employer and, in any
event, upon the termination of Employee’s employment with Employer and its
Affiliates, Employee shall deliver to Employer all memoranda, notes, records,
manuals or other documents, including all copies of such materials containing
Trade Secrets or Confidential Information, whether made or compiled by Employee
or furnished to him from any source by virtue of his employment with Employer
and its Affiliates (“Property”).  After the termination of Employee’s employment
with Employer and its Affiliates, Employee shall not take any action to preserve
or regain access to any Property through any means, including, without
limitation, access to the facilities of Employer or its Affiliates or through a
computer or other digital or electronic means.

11. Remedies; Waiver. 

(a) Employee acknowledges that a violation by him of any provision of Section 7
through Section 10, inclusive, of this Agreement (the “Business Protection
Covenants”) may cause irreparable injury to Employer, and that there may be no
adequate remedy at law for such violation.  Therefore, Employee agrees that, in
addition to any other remedies for his violation of the Business Protection
Covenants available to Employer, which shall include the recovery of all damages
incurred, as well as reasonable attorney’s fees and other costs, Employer shall
have the right, in the event of the breach or threatened breach of any provision
of the Business Protection Covenants, to obtain an injunction and/or temporary
restraining order against such breach or threatened breach and/or to
specifically enforce the Business Protection Covenants, and, in the case of a
breach of Section 9 hereof, the duration of the Restricted Period shall be
extended by the period of the breach and any litigation with respect thereto.

(b) The remedies provided in this Agreement are not exclusive, and the Party
suffering from a breach or default of this Agreement may pursue all other
remedies, both legal and equitable, alternatively or cumulatively.  The
prevailing Party in any action, suit or proceeding arising out of or relating to
this Agreement shall be entitled to recover all costs and reasonable attorneys’
fees from the non-prevailing Party.  The failure of a Party to fully enforce any
provision of this Agreement shall not be deemed to be a waiver of such provision
or any part thereof, and the waiver by a Party of any provision of this
Agreement shall not be deemed to be a waiver of any other provision of this
Agreement or a waiver with respect to any other incidence of non-compliance
therewith.  No waiver shall be effective unless in writing and signed by the
Party so waiving. 

12. Termination.

 

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(a) During a Term, Employee’s employment, including without limitation, all
compensation, salary, expense reimbursement, and employee benefits, (i) may be
terminated at the election of Employer for Cause, upon Employer’s delivery of
notice thereof to Employee; (ii) may be terminated at the election of Employer
without Cause at any time, upon Employer’s delivery of notice thereof to
Employee; (iii) may be terminated at the election of Employee for Good Reason,
as defined in Section 12(g) hereof, or without Good Reason, upon Employee’s
delivery of notice thereof to Employer; (iv) shall be terminated upon Employee’s
death; or (v) may be terminated at the election of either Party, upon Employee’s
disability resulting in an inability to perform the Duties and other
responsibilities as set forth in Section 1 hereof for a period of 180
consecutive days, upon either Party’s delivery of notice of such election
thereafter to the other Party.

(b) As used in this Agreement, “Cause” shall mean (i) conduct by Employee that
amounts to fraud, personal dishonesty, incompetence, breach of fiduciary duty
involving personal profit, gross negligence or willful misconduct in the
performance of or intentional failure to perform his stated Duties; (ii) the
conviction (from which no appeal may be, or is, timely taken) of Employee of a
felony or willful violation of any law, rule or regulation (other than traffic
violations or similar offenses); (iii) any federal or state regulatory
authorities acting under lawful authority pursuant to provisions of federal or
state law or regulation which may be in effect from time to time exercises any
power granted to it by law or regulation to remove, prohibit or suspend Employee
from participating in the conduct of Employer’s affairs; (iv) willful violation
of any final cease-and-desist order; (v) knowing violation of federal or state
banking laws or regulations which are likely to have a material adverse effect
on Employer, as determined by the Board of Directors or CEO; (vi) refusal to
perform timely a reasonable and duly authorized directive of Employer’s Board of
Directors or CEO clearly communicated to Employee by the Board of Directors or
CEO that is consistent with the scope of Employee’s duties under this Agreement
unless Employee in good faith believes that such act would cause Employee to
breach his fiduciary duties to Employer or that such act would be in violation
of any federal or state law or regulation; (vii) or material breach of any
provision of this Agreement.

(c) Any termination of employment by Employer shall be approved by a majority
Employer’s Board of Directors.

(d) If Employee’s employment is terminated by Employer for Cause, Employee shall
receive no further compensation or benefits other than all unpaid compensation
and benefits that have accrued through the date of termination. Employer shall
pay the foregoing amount in a lump-sum payment within five (5) business days
after the date of such termination.  For the avoidance of doubt, the term
“benefits” as used in this Section 12 shall not include accrued but unused
vacation.

(e) If Employee’s employment is terminated either pursuant to Employee’s death
or Employee’s disability, Employee shall receive no further compensation or
benefits other than: (i) all unpaid compensation and benefits that have accrued
through the date of termination; and (ii) any unused vacation that has accrued
through the date of termination, computed on a daily basis. Employer shall pay
the foregoing amounts to Employee or Employee’s estate, in the event of death,
in a lump-sum payment within ten (10) business days of the date of termination
or notice of such termination, whichever is later.

 

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(f) If Employee’s employment is terminated by Employer without Cause pursuant to
Section 12(a)(ii) hereof or if Employee’s employment is terminated by Employee
for Good Reason (as defined in Section 12(g) hereof), Employee shall be entitled
to payment of (i) all unpaid compensation and unused vacation time that have
accrued through the date of termination, which shall be paid in one lump sum
cash payment, and (ii) subject to Section 12(h) and Section 12(l) hereof,
severance (“Severance”) in an amount equal to six (6) months of Employee’s then
current base salary, payable in six (6) equal monthly payments commencing two
(2) weeks after the date that the Release described in Section 12(h) hereof
becomes effective and irrevocable.

(g) As used in this Agreement, “Good Reason” shall mean the satisfaction of all
of the following requirements:

(i) Subject to the satisfaction of Section 12(g)(ii) hereof, the facts and
circumstances that shall constitute Good Reason are as follows:  (A) without
Employee’s consent, Employer materially diminishes Employee’s then-current Base
Salary rate, other than a diminution made pursuant to a broad-based,
employee-wide salary reduction program adopted by the Board of Directors; (B)
without Employee’s consent, Employer materially diminishes (excluding premium
adjustments and changes generally applicable to employees of Employer) any
benefit granted or provided pursuant to Section 5 hereof, other than as part of
a reduction in benefits applicable to all executive officers or employees of
Employer; (C) without Employee’s consent, Employer materially diminishes
Employee’s management authority with respect to Employer’s Point-of-Sale
Sponsorship business; (D) without Employee’s consent, Employer requires Employee
to perform his Duties primarily from an Employment Location that is more than
forty-five (45) miles from the Employee’s most recently-designated Employment
Location; or (E) Employer breaches any material provision of this Agreement,
including, without limitation, Section 3 or Section 5 hereof.

(ii) The Employee shall have given the Employer written notice within 30 days of
his knowledge or reason to know of the existence of any fact or circumstance
constituting Good Reason as described in Section 12(g)(i) hereof, and the
Employer shall failed to cure or eliminate such fact(s) or circumstance(s)
within 30 days of its receipt of such notice.

(h) Employer’s obligation to pay any Severance or a Change in Control Payment
(as defined in Section 12(j) hereof) will not apply unless Employee (i) has been
terminated as, or resigns as, an officer of Employer and Employer’s Affiliates,
if any, to the extent each is applicable, (ii) has returned all Employer
property and (iii) signs and does not revoke a general release of claims (in a
form prescribed by Employer) of all known and unknown claims that Employee may
then have against Employer and/or its Affiliates (the “Release”) and provided
that such Release becomes effective and irrevocable no later than sixty (60)
days following the termination date (such deadline, the “Release Deadline”). If
the Release does not become effective and irrevocable by the Release Deadline
and clauses (i) and (ii) above are not satisfied, Employee will forfeit any
rights to Severance or the Change in Control Payment under this Agreement. In no
event will Severance or the Change in Control Payments be paid or provided until
the Release becomes effective and irrevocable. The Release shall cover all
claims, known or unknown, relating to Employee’s employment, including without
limitation any claims for discrimination or the Employer’s breach of this
Agreement. The Release shall exclude any claims with respect to any issued
capital stock of Employer and any vested stock options (to the

 

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extent that such stock options by their terms expressly survive the termination
of employment), and any Severance or Change in Control Payment, benefits and
other post-employment obligations of the Employer as contemplated by this
Section 12.

(i) In the event Employee is terminated pursuant to Section 15(k) hereof,
Employee shall be entitled to receive only the compensation and benefits set
forth in Section 15(k).

(j) Notwithstanding any provisions hereof to the contrary, if there occurs a
Change in Control (as defined below) of the Employer and, within one hundred
eighty (180) days after the date of the closing of the transaction effecting
such Change in Control, Employer terminates Employee’s employment without Cause
and not upon Employee’s death or disability, or Employee terminates Employee’s
employment for Good Reason, Employer shall pay Employee a lump sum cash payment
(the “Change in Control Payment”) in an amount equal to one hundred percent
(100%) of the Employee’s then current base salary. Employer shall make the
Change in Control Payment after Employer or Employee, as applicable, provides
notice of termination of employment and within two (2) weeks after the date the
Release becomes effective and irrevocable.  As used in this Section, “Change in
Control” shall mean:

(i) any transaction, whether by merger, consolidation, asset sale, tender offer,
reverse stock split, or otherwise, which results in the acquisition or
beneficial ownership (as such term is defined under rules and regulations
promulgated under the Exchange Act) by any person or entity or any group of
persons or entities acting in concert, of 50% or more of the outstanding shares
of common stock of Employer;

(ii) the sale of all or substantially all of the assets of the Employer; or

(iii) the liquidation of the Employer.

In addition to the Change in Control Payment under the circumstances described
in this Section, Employee may be entitled to accelerated vesting of unvested
stock options in accordance with any stock option plan of Employer then in
effect, with any such accelerated vesting to be governed by the terms of any
such stock option plan.

 

(k) Notwithstanding anything contained herein to the contrary, (i) Employer’s
decision not to renew this Agreement at the end of its then-current Term shall
not be deemed a termination of employment by Employer without Cause and (ii)
Employee’s decision not to renew this Agreement at the end of its then-current
Term shall not be deemed a termination of employment by Employee for Good
Reason, and, in either case, Employee shall be entitled only to payment from
Employer of all unpaid compensation and unused vacation time that have accrued
at the expiration of such Term in lump sum within two (2) weeks after the date
of termination.

(l) Any payments made to the Employee pursuant to this Agreement, or otherwise,
are subject to and conditioned upon their compliance with Section 18(k) of the
Federal Deposit Insurance Act (12 U.S.C. § 1828(k)) and the regulations
promulgated thereunder (including those contained in 12 C.F.R. Part 359), as
such statutory provision and regulations may be amended, superseded and/or
replaced from time to time.  In addition, if a payment obligation under this
Agreement arises on account of the termination of Employee’s employment

 

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while Employee is a “specified employee” (as defined under Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”), and determined in good
faith by Employer), any and all payments of “deferred compensation” (as defined
in Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the
exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12)) that
are scheduled to be paid within six months after such termination of employment
shall be paid in a lump sum within 15 days after the end of the six-month period
beginning on the date of such termination of employment.  If Employee dies prior
to the date payments are required to commence in accordance with the previous
sentence, then payment shall be made in a lump sum within 15 days after the
appointment of the personal representative or executor of Employee’s estate
following his death. 

(m) Notwithstanding anything in this Agreement to the contrary, this Agreement,
and the rights and obligations of the Parties, shall be subject to the
following:

(i) If the Employee is suspended and/or temporarily prohibited from
participating in the conduct of the Employer’s affairs by a notice served under
Section 8(e)(3) or (g)(1) of Federal Deposit Insurance Act (12 U.S.C. §
1818(e)(3) and (g)(1)) the Employer’s obligations under this Agreement shall be
suspended as of the date of service unless stayed by appropriate proceedings. If
the charges in the notice are dismissed, the Employer may in its discretion (A)
pay the Employee all or part of the compensation withheld while its contract
obligations were suspended, and (B) reinstate (in whole or in part) any of its
obligations which were suspended.

(ii) 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)(4) or (g)(1) of the Federal Deposit Insurance Act (12 U.S.C. § 1818(e)(4)
or (g)(1)), all obligations of the Employer under this Agreement shall terminate
as of the effective date of the order, but vested rights of the Parties shall
not be affected.

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

(iv) All obligations under this Agreement shall be terminated, except to the
extent determined that continuation of the Agreement is necessary for the
continued operation of Employer:

(1)

By the applicable Regional Director (the “Director”) of the Federal Deposit
Insurance Corporation (the “FDIC”) or his or her designee, at the time the FDIC
enters into an agreement to provide assistance to or on behalf of Employer under
the authority contained in 13(c) of the Federal Deposit Insurance Act; or

(2)

By the Director or his or her designee, at the time the Director or his or her
designee and any other federal banking agency that supervises Employer approve a
supervisory merger to resolve problems related to operation of Employer or when
Employer is

 

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determined by the Director and/or any other federal banking agency that
supervises Employer to be in an unsafe or unsound condition.

Provided, however, that any rights of the Parties that have already vested shall
not be affected by such action.

 

13. Withholding of Taxes.  All compensation and benefits payable to Employee
under this Agreement, including, without limitation, Severance and the Change in
Control Payment, shall be subject to all applicable tax withholding
requirements.

14. Notices.  Any notice or other communication required or permitted to be
given to a Party shall be in writing and addressed to such Party as set forth
below. Notices shall be effective when actually delivered by any commercially
reasonable means, provided that if such delivery occurs on any day other than a
business day or after the close of business on any business day, the same shall
be effective on the next business day. Further, notices sent by certified or
registered mail, return receipt requested, or by nationally recognized express
courier service, shall be effective on the earlier of (a) actual delivery or (b)
refusal to accept delivery or on failure of delivery because the recipient
address is not open to receive deliveries between 9:00 am and 5:00 pm on any
business day. Notices sent by facsimile or other electronic means shall be
effective only if also sent by nationally recognized express courier service for
delivery on the next business day.  All notices and other communications shall
be addressed as follows:

Employer:Kevin B. Cashen

Bay Bank, FSB

23238 West Joppa Road, Suite 325

Lutherville, Md. 21093

 

Employee:Gary M. Jewell

2425 Autumn Way

Baltimore, Maryland 21234

 

15. Miscellaneous.

(a) This Agreement, together with Exhibit A, constitutes and expresses the whole
agreement of the Parties in reference to the employment of Employee by Employer,
and there are no representations, inducements, promises, agreements,
arrangements, or undertakings oral or written, between the Parties other than
those set forth herein.

(b) This Agreement has been made in and shall be governed by and construed in
accordance with the laws of the State of Maryland, exclusive of any conflicts of
law principle which would apply the law of another jurisdiction, and, to the
extent applicable, the laws of the United States, whether as to its validity,
construction, capacity, performance or otherwise.  THE PARTIES HEREBY WAIVE
TRIAL BY JURY IN ANY ACTION ARISING UNDER THIS AGREEMENT.  Any judicial
proceeding arising out of or relating to this Agreement (including any
declaratory judgments) shall, if it is to be filed in State court, be filed
exclusively in the State courts located in Baltimore County, Maryland or, if is
to be filed in Federal court, be filed exclusively in the Federal courts located
in Baltimore, Maryland, and each Party hereby consents to, and will submit to,
the personal and subject matter jurisdiction of such courts in any

 

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proceeding to enforce any of its obligations under this Agreement and shall not
contend that any such court is an improper or inconvenient venue.  The foregoing
shall not limit the right of any Party to obtain execution of judgment in any
other jurisdiction. 

(c) It is the desire and intent of the Parties that the provisions contained in
each Section of this Agreement, and within the subsections of such Sections,
especially (but in no way limited to) those provisions of Section 9 hereof, are
intended to be separate and divisible, severable from every other contract and
course of business by and between the Parties, and shall be enforced to the
fullest extent permissible under applicable laws and public
policies.  Accordingly, if any portion of any provision of this Agreement shall
be adjudicated by a court of competent jurisdiction to be invalid or
unenforceable, then (i) such portion shall not be held to affect the validity of
any other provision contained in this Agreement, and (ii) such portion shall be
deemed amended either to conform to such restrictions as such court may allow or
to delete therefrom or reform the portion thus adjudicated to be invalid and
unenforceable.  The Parties hereby expressly request and authorize any court of
competent jurisdiction to modify any provision of this Agreement or portion
thereof if necessary to render it enforceable in such manner as to preserve as
much as possible the Parties’ original intentions, as expressed therein, with
respect to the scope thereof. 

(d) Without limiting the generality of the provisions of Section 15(c) hereof,
the Parties agree that the existence of any claim, suit or action by Employee
against Employer, whether predicated upon this Agreement or any other agreement,
shall not constitute a defense to Employer’s enforcement of any covenant made by
Employee in Section 7 through Section 10, inclusive, of this Agreement. 

(e) Time is of the essence in this Agreement.

(f) This Agreement shall be binding upon and inure to the benefit of the Parties
and their successors and assigns. This Agreement shall not be assignable by
Employee.

(g) This Agreement may be executed in multiple counterparts, each of which shall
be deemed an original and all of which taken together shall constitute but a
single instrument.  The exchange of copies of this Agreement and of signature
pages by facsimile or PDF transmission shall constitute effective execution and
delivery of this Agreement as to the Parties and may be used in lieu of an
original of this Agreement for all purposes.  Signatures of the Parties
transmitted by facsimile or PDF transmission shall be deemed to be their
original signatures for all purposes.

(h) The provisions of Section 7 and of Sections 9 through 16, inclusive, of this
Agreement shall survive the termination of the Employee’s employment under this
Agreement and shall remain in full force and effect until the Parties have fully
performed thereunder and, in any event, until the applicable statute of
limitations thereon have expired. 

(i) The headings of Sections and subsections contained in this Agreement are
provided for convenience only.  They form no part of this Agreement and shall
not affect its construction or interpretation.  All references to Sections,
subsections, paragraphs, clauses or other subdivisions in this Agreement refer
to the corresponding Sections, subsections, paragraphs, clauses or other
subdivisions of this Agreement.  All words used in this

 

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Agreement shall be construed to be of such gender or number as the circumstances
require.  Unless otherwise specifically noted, the words “herein”, “hereof”,
“hereby”, “hereunder” and words of similar import refer to this Agreement as a
whole and not to any particular Section, subsection, paragraph, clause or other
subdivision of this Agreement.

(j) Employee represents and warrants that he is not subject to any restrictions
or covenants which would restrict or prohibit his performance hereunder.

(k) Upon acceptance by the Parties, this Agreement shall be contingent upon a
work history, criminal and academic background check of Employee by Employer and
appropriate banking regulatory agencies, if applicable. In the event that in the
reasonable determination of Employer or a banking regulatory agency, Employee
has been less than forthright in his disclosure of such information to Employer
or the appropriate banking regulatory agency objects to Employee’s service as
Executive Vice President, without conditions, then this Agreement shall be null
and void other than Employer shall pay to Employee an amount equal to all
accrued and unpaid compensation and benefits through the effective date of any
such notice.

[Signatures Appear on Next Page]

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and
year first written above.

 

EMPLOYEE

 

/s/ Gary M. Jewell

Gary M. Jewell

 

EMPLOYER

 

BAY BANK, FSB

 

By:   /s/ Kevin B. Cashen 

Name: Kevin B. Cashen 

Title: President & Chief Executive Officer

 

 

 

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Exhibit A
to Employment Agreement by and between
Gary M. Jewell
and
Bay Bank, FSB

Employee Compensation

 

Capitalized terms used herein and not defined shall have the meanings set forth
in the Employment Agreement.

 

Base Salary:  

For services rendered under this Agreement, Employee shall be entitled to
receive a Base Salary at the rate of $180,000 per year. The Chief Executive
Officer and Board of Directors shall consider, among other considerations, a
review of market data annually for the average compensation package for an
executive with comparable duties of institutions of comparable size when
considering any adjustment to the base salary.

 

Performance Incentive Bonus:  

In addition to the Employee’s Base Salary, the Employee is eligible to receive a
Performance Incentive Compensation (“Incentive”) based on the satisfactory
performance of the Employee’s Duties and the financial performance of the
point-of-sale sponsorship business. The Incentive payment will be based on the
gross revenue of the point-of-sale sponsorship business for the fiscal year and
will be paid within 60 days of the end of the fiscal year.  The schedule for the
Incentive payment will be as follows: 

 

·

Tier 1 – Gross Revenue of $1,000,000 to $1,500,000

o

Incentive payment of  20% of Base Salary

·

Tier 2 – Gross Revenue of $1,500,001 to $1,750,000

o

Incentive payment of 25% of Base Salary

·

Tier 3 – Gross Revenue of $1,750,001 to $2,000,000

o

Incentive payment of 30% of Base Salary

·

Tier 4 – Gross Revenue of $2,000,001 to $2,500,000

o

Incentive payment of 40% of Base Salary

·

Tier 3 – Gross Revenue of $2,500,001 or greater

o

Incentive payment of 50% of Base Salary

 

Payment of any performance bonus will not be made until the Board of Directors
has determined, according to reasonable safety and soundness standards and
subject to any regulatory requirements or limitations, that the overall
financial condition of Employer will not be adversely affected by the payment of
the performance bonus. 

 

Leave/Vacation

The Employee shall be entitled to five (5) weeks annual paid leave/vacation per
year.  Vacation must be approved by the Chief Executive Officer.  The Employee
shall not use more than two (2) weeks of vacation at any one time.  The Employee
may carry over a maximum of five (5) days

A-1

 

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into the subsequent year.

 

Group Insurance: 

Employee shall be entitled to participate in such health, hospitalization,
dental, life insurance, and any other insurance plans as may be adopted by
Employer’s Board of Directors for its employees and their dependents. The
Employee will provide a minimum of $300,000 in group life insurance to the
Employee.

 

Trade and Civic Associations: 

Employer will pay Employee’s membership dues in such trade and civic
associations as determined by Employer’s Board of Directors in its sole
discretion.

 

It is the responsibility of the Chief Executive Officer and Board of Directors
to treat all Executive incentive compensation in accordance with the guidance
provided by the Office of the Comptroller of the Currency.  Executive incentive
compensation must conform to reasonable safety and soundness standards and all
regulatory requirements or limitations on the institution. 

 

This is to confirm my understanding and agreement that the Employment Agreement
to which this addendum is attached is subject to ratification by Employer’s
Board of Directors at its next scheduled meeting.

The only restrictions or covenants which would restrict or prohibit my
performance under the Employment Agreement are listed below (specify “none”, if
applicable):

 

_____________________________________________________________________________

 

EMPLOYEE

_/s/ Gary M. Jewell (SEAL)

 

Signature

A-2

 

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