Exhibit 10.4


 


EMPLOYMENT AGREEMENT


 


This Agreement
effective November 18, 2002, by and between Nevada Security Bank, a Nevada
corporation (“Bank”), and David A. Funk (“Executive”).


 


Bank desires
to employ Executive to devote full time to the business of the Bank, and
Executive desires to be so employed.


 


The parties
agree as follows:


 


I.


 


EMPLOYMENT TERM


 


Bank agrees to
employ Executive, and Executive agrees to be so employed, in the capacity of
President.  Employment shall begin
November 18, 2002 and continue until termination in accordance with this
Agreement.


 


II.


 


TIME AND EFFORTS


 


Executive
shall diligently and conscientiously devote his full and exclusive time and
attention and best efforts in discharging his duties as the Bank’s President.


 


III.


 


BOARD OF DIRECTORS


 


Executive
shall be a member of the Board of Directors and at all times discharge his
duties in consultation with and under the supervision of the Bank’s Board of
Directors.  In the performance of his
duties, Executive shall make his principal office in such place as the Bank’s
Board of Directors and Executive may from time to time agree.


 


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IV.


 


COMPENSATION


 


Bank shall pay
to Executive as compensation for his services the sum of $140,000.00 per year
payable semi-monthly.


 


V.


 


EXPENSES


 


(a)                                  Business.                                              The Bank
shall reimburse Executive for all reasonable and necessary business expenses
incurred in carrying out his duties under this Agreement.  Executive shall present to the Bank from
time to time an itemized account of such expenses in any form required by the
bank.


 


(b)                                 Memberships.                     The Bank shall pay or reimburse
Executive for social, professional and community membership fees, including but
not limited to, Hidden Valley County Club, Prospectors Club, Western Industrial
of Nevada, Economic Development of Western Nevada, American Bankers
Association, Western Independent Bankers and Nevada Bankers.


 


(c)                                  Automobile.                              The Bank shall pay
Executive a car allowance of $700.00 a month.


 


VI.


 


EXECUTIVE BENEFITS


 


Executive
shall receive the following:


 


(a)                                  Insurance.                                       Bank paid
medical, vision, short and long term disability and a $525,000 life insurance
policy.


 


(b)                                 Vacation.                                           Four weeks
paid vacation per calendar year commencing January 1, 2003 accruing at the rate
of one week every three months.  For the
remainder of the calendar year 2002, Executive shall be entitled to four days
paid vacation.  Upon termination
Executive shall be paid for accrued and unused vacation.


 


(c)                                  Holidays.                                            All paid
holidays the Bank observes.


 


(d)                                 Sick leave.                                     Ten paid sick
leave days per year accruing at the rate 2.5 days every three months.  Unused sick days can be accumulated up to
120 days.


 


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(e)                                  401K.               Executive
is eligible to participate in Bank’s 401K Plan following 90 days of
employment.  There are currently no Bank
matching contributions.


 


(f)                                    Stock options.                  15,000 shares of Bank stock at an
option price of $10 a share subject to the conditions of the Bank’s Stock
Option Plan.  The option to purchase the
stock shall vest as follows: 3,000 shares vest immediately on the first day of
employment; thereafter an additional 3,000 shares vest yearly on the
anniversary date of employment for 4 years.


 


(g)                                 Participation in other executive and/or
employee-benefit plans.


Nothing in
this Agreement shall in any manner modify, impair, or affect the existing or
future rights or interests of the Executive (a) to receive any executive and/or
employee-benefits to which he would otherwise be entitled, or (b) as a
participant in the present or any future incentive profit-sharing or bonus
plan, stock option plan or pension plan of the Bank.  The rights and interests of the Executive to any executive and/or
employee benefits or as a participant or beneficiary in or under any or all
such plans shall continue in full force and effect.  The Executive shall have the right at any future time to become a
participant or beneficiary under or pursuant to any and all such plans.


 


VII.


 


TERMINATION FOR CAUSE


 


The Bank may
terminate this Agreement at any time by action of its Board of Directors,
without further obligation or liability to the Executive, in the event that:


 


(a)                                  The
Executive fails to abide by and/or enforce the Bank’s written safety and
soundness policies; or


 


(b)                                 The
Executive is convicted of a felony or misdemeanor involving moral turpitude; or


 


(c)                                  State
and/or Federal regulators request or order termination of this Agreement; or


 


(d)                                 The
Executive commits any act which could cause termination of Coverage under the
Bank’s Blanket Bond as to the Executive, as distinguished from termination of
such coverage as to the Bank as a whole; or


 


(e)                                  The
Executive dies.


 


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VIII.


 


TERMINATION WITHOUT CAUSE


 


In the event
the Board of Directors of the Bank determines that either (i) the continued
association of the Executive with the Bank or (ii) the performance of his
duties by the Executive is not in the best interest of the Bank, then the Bank
may terminate this Agreement by action of its Board of Directors.  In the event of such termination without
cause, the Executive shall be paid as and for severance payments and in lieu of
any and all other Compensation, remedy or damages, a non-discounted lump-sum
equal to not less than Twelve (12) months compensation at the then current base
salary of the Executive, plus any accrued and unused vacation days and any
accrued but unpaid Bonus Compensation. 
In addition, the Bank, at its expense will provide the Executive and his
dependent family with medical and vision insurance coverage for a period of not
less than six (6) months following the Executive’s termination.  Upon such payment and provision of insurance
coverage, any and all obligations of the Bank to the Executive shall have been
fully and completely satisfied and the Executive shall be entitled to no
additional compensation, claim, right or benefit hereunder or otherwise.


 


IX.


 


ACTION BY SUPERVISORY AUTHORITY


 


If the Bank is
closed or taken over by any banking supervisory authority, such banking
authority may immediately terminate this Agreement without liability or
obligation to the Executive.


 


X.


 


MERGER OR CORPORATE DISSOLUTION


 


In the event
of a merger where the Bank is not the surviving corporation, in the event of a
consolidation, in the event of a transfer of all or substantially all of the
assets of the Bank, in the event of any other corporate reorganization where
there is a change in ownership of at least Twenty Five Percent (25%) except as
may result from a transfer of the Bank’s stock to another corporation in
exchange for at least Sixty-Six and Two/Thirds Percent (66 2/3%) control of
that corporation, or in the event of the dissolution of the Bank, the Executive
may terminate this Agreement.  In the event
of such termination, the Executive shall be paid, as and for severance payments
and in lieu of any and all other compensation remedy or damages, a
non-discounted lump-sum equal to not less than Twenty Four (24) months
compensation at the then current base salary of the Executive, plus any accrued
and unused vacation days and any accrued but unpaid Bonus Compensation.  In addition, the Bank at its expense will
provide the Executive and


 


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his dependent family with medical and vision insurance coverage for a
period of not less than Twelve (12) months following the Executive’s
termination.  Upon such payment and
provision of insurance coverage, any and all obligations of the Bank to the
Executive shall have been fully and completely satisfied and the Executive
shall be entitled to no additional compensation, claim, right or benefit
hereunder or otherwise.


 


XI.


 


TERMINATION BY THE EXECUTIVE


 


The Executive
may terminate his employment hereunder at any time upon Ninety (90) days notice
to the Bank.  In such event, the
Executive shall be entitled to all salary, bonus, and other benefits (accrued
vacation, etc.), which have accrued prior to the effective date of termination.  All unvested options shall be forfeited and
the Executive must exercise his vested options within Sixty (60) days of
termination.  If not so exercised, those
options shall also be forfeited.


 


XII.


 


INDEMNIFICATION


 


The Bank shall
indemnify the Executive against liability or loss arising out of the
Executive’s actual or asserted negligence, misfeasance or malfeasance in the
performance of the Executive’s duties or out of any actual or asserted wrongful
act or omission against, or by, the Bank including, but not limited to,
judgments, fines, settlements, expenses, attorney fees and costs incurred in
the defense of actions, proceedings and appeals therefrom.  The Bank shall provide Directors and
Officers Liability Insurance to indemnify and insure the Bank and the Executive
from and against the aforementioned liabilities.  The provisions of this paragraph shall apply to the estate,
executor, administrator, heirs, legatees or devisees of the Executive.


 


XIII.


 


NOTICES


 


Any written
notice required or desired to be given under this Agreement shall be given in
writing and delivered, personally or by certified mail to the Executive’s
residence or to the Bank’s principal office, as the case may be.


 


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XIV.


 


WAIVER OF BREACH


 


The Bank’s
waiver of a breach of any provision of this Agreement by the Executive shall
not operate or be construed as a waiver of any subsequent breach by the
Executive. No waiver shall be valid unless in writing and signed by an
authorized officer of the Bank.


 


XV.


 


ASSIGNMENT


 


The Executive
acknowledges that his services are unique and personal.  Accordingly, the Executive may not assign
his rights or delegate his duties or obligations under this Agreement.  The Bank’s rights and obligations under this
Agreement shall inure to the benefit of and shall be binding upon the Bank’s
successors and assigns.


 


XVI.


 


ATTORNEYS’ FEES AND COSTS


 


If either
party brings an action or a proceeding, including arbitration, to enforce,
protect, or establish any right or remedy under the terms of this Agreement,
the prevailing party shall be entitled to reasonable attorneys’ fees and costs,
and the fees and expenses of the arbitrators in any arbitration proceeding.


 


XVII.


 


ENTIRE AGREEMENT


 


This Agreement
contains the entire understanding of the parties.  It may not be changed orally but only by an Agreement in writing
signed by the party against whom enforcement of any waiver, change,
modification, extension, or discharge is sought.


 


XVIII.


 


GOVERNING LAW


 


This
Employment Agreement shall be governed by and construed in accordance with the
laws of the State of Nevada in effect from time to time.


 


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XIX.


 


SEVERABILITY


 


The
severability, unenforceability, invalidity, or illegality of any provision of
this Employment Agreement shall not render any other provisions unenforceable,
invalid, or illegal, and the Employment Agreement shall be construed in all
respects as if the unenforceable, invalid or illegal provisions were omitted.


 


XX.


 


HEADINGS


 


Headings in
this Agreement are for convenience only and shall not be used to interpret or
construe its provisions.


 


XXI.


 


COUNTERPARTS


 


This Agreement
may be executed in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
instrument.


 


XXII.


 


GENDER AND NUMBER


 


As used in
this Employment Agreement, the masculine, feminine, or neuter gender, and
singular or plural number, shall each be considered to indicate the others
whenever the context so indicates.


 


XXIII.


 


AGREEMENT TO BE CONSTRUED IN ACCORDANCE WITH
ITS INTENT


 


This Agreement
shall be construed in accordance with its intent and without regard to any
presumption or other rule requiring construction against the party causing the
same to be drafted.


 


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IN WITNESS
WHEREOF the parties have executed this Agreement effective the day first above
written.


 


	
  Nevada Security Bank

  	
  Executive

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Hal Giomi

  	
   

  	
  /s/ David A. Funk

  	
   

  
	
  President & CEO

  	
   

  	
  3290 [ILLEGIBLE]

  	
   

  
	
   

  	
  address

  
	
  Board of Directors

  	
  Reno, NV 89502

  	
   

  



 


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NEVADA SECURITY BANK


EMPLOYMENT AGREEMENT
ADDENDUM


DAVID A. FUNK


 


 


An employment agreement dated
November 18, 2003, by and between Nevada Security Bank and David A. Funk, is
hereby amended to include the following paragraph:


 


 


EXECUTIVE BENEFITS


 


 


Retirement Benefits:   The Executive shall be provided with
medical, dental and vision insurance benefits for himself and eligible family
members equivalent to the maximum benefits available from time to time under
the Bank’s Group Insurance program for an employee of the Executive’s salary
level at the Bank’s expense upon retirement from the Bank.  Retirement age shall be at a minimum
Sixty-two (62) years of age.


 


 


IN WITNESS WHEREOF the parties
have executed this Addendum to the Agreement effective on May 9, 2003.


 


 


	
  Nevada
  Security Bank

  	
  David A.
  Funk, Executive

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Hal Giomi

  	
   

  	
  /s/ David A.
  Funk

  	
   

  
	
  Chief
  Executive Office

  	
   

  
	
  Board of
  Directors

  	
   

  
					



 


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NEVADA SECURITY BANK


EMPLOYMENT AGREEMENT
ADDENDUM NUMBER TWO


DAVID A. FUNK


 


 


An employment agreement dated
November 18, 2003, by and between Nevada Security Bank and David A. Funk, is
hereby amended as follows:


 


 


VI.


 


EXPENSES


 


(C).  Automobile.            The Bank shall pay Executive a car allowance of $750.00 a
month.


 


 


 


IN WITNESS WHEREOF the parties
have executed this Addendum to the Agreement effective on July 2, 2003.


 


 


	
  Nevada
  Security Bank

  	
   

  	
  David A.
  Funk, Executive

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Hal Giomi

  	
   

  	
    /s/
  David A. Funk

  	
   

  
	
  Chief
  Executive Office

  	
   

  	
   

  
					



 


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