Exhibit 10.16


 


EXECUTIVE
EMPLOYMENT AGREEMENT


 


This Executive Employment
Agreement (“Agreement”) is made and shall be effective as of this first day of
January, 2003, by and between Central Pacific Bank, a Hawaii corporation, (the
“Corporation”), with its principal offices at 220 South King Street, Honolulu,
Hawaii 96813, and Sherri Y. Yim (the “Employee”).


 


RECITALS


 


A.          Employee is presently an employee of the Corporation and is
presently employed in her current executive capacity as Senior Vice President and
Controller of the Corporation.


 


B.          The Corporation and the Employee wish to acknowledge and
memorialize the terms and conditions of the Employee’s employment with the
Corporation.


 


AGREEMENT


 


NOW, THEREFORE, in
consideration of the foregoing and of the terms, conditions and covenants
contained herein, the parties hereto agree as follows:


 


1.           Employment. Employee shall continue to be employed
in her current title and/or capacity (herein collectively referred to as
“capacity”), but subject to the terms and conditions stated hereinafter.


 


2.           Scope of the Employment. During the term of
employment, the Employee shall exert the Employee’s best efforts and devote the
Employee’s full and exclusive professional and/or business efforts, time and
attention in fulfilling and discharging the Employee’s duties in her current
capacity or in any other future capacity as designated by the Corporation. The
services to be performed by the Employee in the Employee’s current capacity may
be extended, curtailed or otherwise modified, from time to time, and/or the
Employee’s title and/or capacity may change, at the discretion of the
Corporation.


 


3.           Term. The term of the Employee’s employment by the
Corporation pursuant to this Agreement shall be at the will of the Corporation
and shall be subject to termination as provided in paragraphs 10, 11 and 12
hereinafter.


 


4.           Compensation and Other Benefits. The Employee shall
continue to have the same compensation as presently paid to Employee, as the
same may be changed from time to time at the discretion of the Corporation
(including but not limited to annual discretionary cash bonus and stock
options, if any) and continue to have the same rights, privileges and other
benefits presently enjoyed


 


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by Employee in her current capacity (subject,
however, to any change, at the discretion of the Corporation, in rights,
privileges and other benefits as a result of any change in the Employee’s
capacity), including but not limited to vacation and sick leave privileges and
the right to participate in any retirement, pension, profit-sharing, stock
option, insurance, medical, or other plans which may now be in effect or which
may hereafter be adopted, all as described in the Corporation’s Employee Benefits
and Policies Manual (the “Employee Manual”).


 


5.           Conduct. Employee shall continue to abide by the
policies set forth in the Corporation’s Employee Manual and all other
applicable policies and procedures of the Corporation, and comply with all
applicable laws, ordinances, rules and regulations now or hereafter made
applicable to the Corporation, its employees, and to Employee in her designated
capacity.


 


6.           Confidentiality of Trade Secrets and Other Materials.


 


a.          The Employee shall regard and preserve as confidential all
Trade Secrets (as defined below) and other non-public, confidential, privileged
and/or proprietary information, including, without limitation, client lists,
client files, and any other client information (collectively referred to herein
as “Confidential Information”) pertaining to the Corporation and its affiliates
and subsidiaries, that has been or may be revealed to or obtained by the
Employee by reason of the Employee’s employment. The Employee shall not take,
retain, copy or use, or disclose to any non- affiliated third party, either
during the Employee’s employment or forever thereafter, any Trade Secret or
other Confidential Information connected with the Corporation and its
affiliates and subsidiaries, except as required in the line of the Employee’s
employment capacity with the Corporation, or as authorized in advance and in
writing by the Corporation, or as required by law, rule, regulation or lawful
court order. This provision shall not apply with respect to information of the
Corporation and its affiliates and subsidiaries, which has been voluntarily
disclosed by the Corporation and its affiliates and subsidiaries, to the public
or otherwise enters the public domain through lawful means.


 


b.          The Employee further agrees that all know-how, strategies,
tactics, documents, reports, plans, proposals, marketing and sales plans,
client lists, client files and materials, or any other Confidential Information
and Trade Secrets revealed to or made by the Employee or that come into the Employee’s
possession by reason of the Employee’s employment hereunder are the property of
the Corporation and shall not be used by the Employee in any way adverse to the
interest of the Corporation and its affiliates and subsidiaries, or for any
unauthorized purpose. The Employee shall not deliver, reproduce or in any way
allow such documents or things to be delivered or used by any non-affiliated
third party without specific direction or consent of a duly authorized
representative of the Corporation. The Employee shall not publish, release or
otherwise make available to any third party any information describing any
Trade Secret or other Confidential Information of the Corporation and its
affiliates and subsidiaries, without prior specific written authorization of
the Corporation. Notwithstanding the foregoing, the Employee may disclose any
information (including,


 


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Confidential Information or Trade Secrets) to
any third-party pursuant to the Employee’s proper authority and capacity of
employment with the Corporation.


 


c.          For purposes of this Agreement, the term “Trade Secrets”
shall include, but not be limited to, information of the Corporation and its
affiliates and subsidiaries, encompassed in all know-how, strategies, tactics,
plans, proposals, marketing and sales plans, client lists, client files,
financial information, costs, risk analysis, and all concepts or ideas in or
reasonably related to the Corporation and its affiliates and subsidiaries, that
have not been previously publicly released by duly authorized representatives
of the Corporation and its affiliates and subsidiaries.


 


7.           Noncompetition During Employment. While employed
hereunder, the Employee agrees to devote all of her professional and business
expertise and efforts to the Corporation, and not to work for any other
business or entity or engage in any activity in competition with the
Corporation and its affiliates and subsidiaries, and not to render any
services, directly or indirectly, of a business, commercial or professional
nature to any other person, firm, corporation or organization for compensation
without the prior written consent of the Corporation, and not to solicit or
entice any employee of the Corporation and its affiliates and subsidiaries, to
leave the employ thereof or work for anyone in competition with the Corporation
and its affiliates and subsidiaries. Furthermore, the Employee hereby agrees
not to take any preliminary steps to set up or engage in any business enterprise
that would be in competition with the Corporation and its affiliates and
subsidiaries, until after the termination of employment hereunder. In addition,
while employed hereunder, the Employee hereby agrees to divulge to the
Corporation any and all competitive plans which the Employee may have under
consideration, whether or not the Employee intends to act upon such plans. As
used in the preceding sentence, the term “competitive plans” shall include, but
not be limited to, plans to set up, establish or engage in any business
enterprise in competition with the Corporation and its affiliates and
subsidiaries, and plans to seek or accept employment from anyone in competition
with the Corporation and its affiliates and subsidiaries.


 


8.           Noncompetition After Termination.


 


a.          Employee agrees that for a period of twenty-four (24)
months after this Agreement or the Employee’s employment, whichever is later,
has been terminated for any reason, regardless of whether the termination is
initiated by Corporation or Employee, or for a period of time equal to the
length of Employee’ employment with Corporation if such tenure is less than
twenty-four (24) months, Employee will not, directly or indirectly, solicit any
person, company, firm, or corporation who is or was a customer of Corporation
during a period of five (5) years prior to the termination of Employee’
employment. Employee agrees not to solicit such customers on behalf of herself
or any other person, firm, company, or corporation. Corporation agrees to
provide a list of such customers whom the Employee may not solicit.


 


b.          Employee agrees that for a period of twelve (12) months
after the termination of her employment with Corporation, regardless of whether
the termination was initiated by


 


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Corporation or Employee, she will not accept
employment with, or act as a consultant, contractor, advisor, or in any other
capacity for, a competitor of the Corporation, or enter into competition with
the Corporation, either by herself or through any entity owned or managed in
whole or in part by the Employee, within the island of Oahu. The term
“competitor” as used in this paragraph 8, means any entity primarily engaged in
the business of providing banking and other related services.


 


c.          The parties have attempted to limit Employee’ right to
compete only to the extent necessary to protect Corporation from unfair
competition. The parties recognize, however, that reasonable people may differ
in making such a determination. Consequently, the parties hereby agree that, if
the scope or enforceability of the foregoing restrictive covenant is in any way
disputed at any time, a court or other trier of fact may modify and enforce the
covenant to the extent that it believes the covenant is reasonable under the
circumstances existing at that time.


 


9.           Injunctive Relief. The Employee understands and
hereby agrees that the Corporation will suffer irreparable harm in the event
that the Employee fails to comply with any of the Employee’ obligations under
paragraphs 6, 7 and 8 above and that monetary damages will be inadequate to
compensate the Corporation for such breach. Accordingly, the Employee hereby
agrees that the Corporation will be entitled to injunctive relief to enforce
the terms of paragraphs 6, 7 and 8 above, as well as any other remedies
available to the Corporation at law or in equity.


 


10.         Termination by Corporation.


 


a.          Termination For Cause. The Corporation may terminate
this Agreement and the Employee’s employment at any time for cause without
further liability or obligation to the Employee except as provided herein by
giving written notice to the Employee. Upon such termination, the Employee
shall have no right to receive compensation or other benefits for any period
after termination for cause except as provided herein. Termination for cause
shall include, but not be limited to, termination because of the Employee’s
personal dishonesty, theft, gross misconduct, gross carelessness, breach of
fiduciary duty, failure to perform stated duties, failure to comply with any of
the Corporation’s policies or procedures, or any violation of law. If this
Agreement and the Employee’s employment is terminated for cause, the Employee
shall be entitled to the Employee’s base salary and accumulated and unused
vacation time earned by the Employee and computed pro rata up to and including
the date of termination, and the Corporation shall have no further obligation
to the Employee. Except as otherwise provided herein, all other benefits
specifically provided for in this Agreement shall cease and lapse as of the
date of termination. Furthermore, any termination shall be without prejudice to
any right or remedy to which the Corporation may be entitled either at law, in
equity, or under this Agreement.


 


b.          Termination Without Cause. The Corporation may
terminate this Agreement and the Employee’s employment at any time without
cause without further liability or obligation to the Employee except as
provided herein by giving the Employee thirty (30) days prior written notice.
Upon the effective date of such termination, the Employee shall have no right
to receive


 


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compensation or other benefits for any period
after termination without cause except as provided herein. If this Agreement
and the Employee’s employment is terminated without cause, the Employee shall
be entitled to the Employee’s base salary and accumulated and unused vacation
time earned by the Employee and computed pro rata up to and including the effective
date of termination, and the Corporation shall have no further obligation to
the Employee. Except as otherwise provided herein, all other benefits
specifically provided for in this Agreement shall cease and lapse as of the
effective date of termination.


 


11.         Termination by Employee. The Employee may resign and
terminate the Employee’s employment hereunder at any time effective thirty (30)
days after delivery of written notice to the Corporation. If the Employee
voluntarily resigns, the Employee shall be entitled to Employee’s base salary
and accumulated and unused vacation time earned by the Employee and computed
pro rata up to and including the effective date of termination, and the
Corporation shall have no further obligation to the Employee.


 


12.         Termination After Change of Control. If the
Employee’s employment pursuant to this Agreement is terminated as a result of
and within twelve (12) months after a Change of Control (as hereinafter
defined), the Employee shall be entitled to the immediate vesting of all
nonvested stock options granted and accumulated up to the date of termination
and a severance pay in an amount equal to three (3) times the Employee’s annual
base salary and annual cash bonus. A “Change of Control” is defined as the
occurrence of any of the following events: (i) a merger where the Corporation
and/or CPB, Inc., the 100% owner of the Corporation (“CPBI”) is not the
surviving corporation; (ii) the transfer of all or substantially all of the
assets of the Corporation to another unaffiliated corporation, entity or
person; (iii) the acquisition by any person, group of related or affiliated
persons (excluding, however, affiliates of the Corporation) or group of persons
acting in concert in one or more transactions of equity securities of the
Corporation and/or CPBI of fifty percent (50%) or more of the outstanding
voting power of the Corporation and/or CPBI after such transaction or
transactions.


 


13.         Limitation on Severance Payments. Notwithstanding the
foregoing, any severance payment and, if applicable, the value of any option
acceleration and any other benefits payable hereunder shall be reduced by such
amount as is necessary, in the opinion of tax counsel or other appropriate tax
advisor selected in good faith by the Corporation, so that no portion of the
foregoing will be subject to excise taxes for an “excess parachute payment”
under Internal Revenue Code Sections 280G and 4999.


 


14.         Withholding. All amounts payable by the Corporation
hereunder shall be subject to all federal, state, local and other withholdings
and employment taxes as required by applicable law.


 


15.         Arbitration. Any dispute or controversy arising
under, out of, in connection with or related to this Agreement or by breach
hereunder shall be determined and settled by binding arbitration in Honolulu,
Hawaii, in accordance with the Rules of the American Arbitration Association


 


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and Hawaii Revised Statutes Chapter 658A.
Judgment upon the award may be entered in a court of competent jurisdiction,
provided that such award shall under no circumstances include as an element
thereof, any award for punitive damages. The prevailing party shall be entitled
to recover from the other party its or her own expenses for the arbitrator’s
fees, attorney’s fees, and for other expenses of presenting its or her case.
Other arbitration costs, including fees for records or transcripts, shall be
borne equally by the parties. The arbitrator is expressly empowered to
determine any matter related to the employment of the Employee, including, but
not limited to, the manner in which employment is terminated, any claims of
tortious conduct, and any other claim, related to the termination of employment
and/or the parties’ actions or omissions of actions prior to or during the
Employee’s employment. Demand for arbitration hereunder shall be made by notice
in writing given to the other party within six (6) months of the event giving
rise to the claim. Failure by any party to assert in writing within six (6)
months of any claim within the scope of this paragraph shall forever bar the
assertion of that claim in any forum.


 


16.         Binding Effect and Assignment. The rights and
obligations of this Agreement shall be binding upon and inure to the benefit of
the Corporation, its successors and assigns. This Agreement shall not be
assigned by the Employee; however, the obligations of the Employee hereunder,
to the extent that such obligations may be performed by the Employee’s estate,
shall be binding upon the Employee’s heirs and estate.


 


17.         Survival of Rights, Duties and Obligations. The
termination of Employee’s employment or of this Agreement shall not release
either party to this Agreement from any liability which at the time of
termination is already accrued to the other party or which thereafter may
accrue with respect to any act or omission arising either prior to such
termination or after such termination when there is a continuing obligation.
Without limiting the foregoing, Sections 6, 8 and 9 shall survive termination
of the Employee’s employment with the Corporation and/or the termination of
this Agreement.


 


18.         Receipt of Agreement. Each of the parties hereto
acknowledges having read this Agreement in its entirety and having received a
fully executed copy thereof. A fully executed copy shall be an original for all
purposes. The Employee further acknowledges that she has been advised, prior to
her execution of this Agreement, of her right to retain and seek the advice of
an attorney regarding this Agreement.


 


19.         Hawaii Law. This Agreement is to be governed by and
construed under the laws of the State of Hawaii.


 


20.         Entire Agreement. This Agreement contains the entire
agreement between the parties  with
respect to the employment of the Employee by the Corporation during the term of
this Agreement and supersedes all prior and contemporaneous agreements,
representations, and understandings of the parties. No modification, amendment,
or waiver of any of the provisions of this Agreement shall be effective unless in
writing, specifically referring hereto, and signed by both parties.


 


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Furthermore, the parties agree to amend this
Agreement or to re-execute a new agreement, as and when necessary, to ensure
the terms and provisions of this Agreement comply with all laws, rules and
regulations at any time applicable to the Corporation and/or this Agreement.


 


21.         Waiver of Breach. The failure to enforce at any time
any of the provisions of this Agreement, or to require at any time performance
by the other party of any of the provisions hereof, shall in no way affect
either the validity of this Agreement or any part hereof of the right of either
party thereafter to enforce each and every provision in accordance with the terms
of this Agreement.


 


22.         Notice. Any written notice required or permitted to
be given hereunder shall be deemed delivered either when personally delivered
or when mailed, registered or certified, postage prepaid with return receipt
requested, if to the Employee, addressed to the Employee at the last residence
address of the Employee as shown in the records of the Corporation, and if to
the Corporation, addressed to the President of the Corporation at the principal
office of the Corporation.


 


23.         Attorneys’ Fees. Should any litigation be commenced
between the parties to this Agreement, concerning any provision of this
Agreement or the rights and obligations of any party in relation thereto, the
party prevailing in such litigation shall be entitled, in addition to such
relief as may be granted by a court of competent jurisdiction, to a reasonable
sum for attorney’s fees in such litigation which shall be determined by the
court in which such litigation occurs, as well as all court costs.


 


24.         Severability. If any provision of this Agreement is
held to be invalid or unenforceable by any court or lawful authority, the
invalidity or unenforceability of such provision shall not affect the validity
and enforceability of the remaining provisions of this Agreement, and all such
remaining provisions and this Agreement shall be construed so as to be valid
and enforceable to the maximum extent permitted by law, and this Agreement
shall be reformed accordingly.


 


[signature
page follows]


 


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


 


 


	
   

  	
  CENTRAL PACIFIC BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Glenn K.C. Ching

  
	
   

  	
   

  	
  Glenn K.C. Ching

  
	
   

  	
   

  	
  General Counsel

  
	
   

  	
   

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  	
   

  	
  (Corporation)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Sherri Yim

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Employee)

  



 


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