Document:

exv10w16

 

EXHIBIT 10.16

EMPLOYMENT AGREEMENT

     This Employment Agreement is made and entered into as of the 1st day of
June, 2002, by and between EXCHANGE UNDERWRITERS, INC., a Pennsylvania
corporation (the “Company”), and RICHARD B. BOYER (“Boyer”).

WITNESSETH:

     WHEREAS, contemporaneously herewith, a majority of the outstanding shares
of the Company’s capital stock is being purchased from Boyer by FedFirst
Exchange Corporation (the “Buyer”) pursuant to a Stock Purchase Agreement dated
May 29, 2002 (the “Purchase Agreement”); and

     WHEREAS, Boyer has heretofore both owned and been employed as Chief
Executive Officer of the Company; and

     WHEREAS, as a condition of the closing under the Purchase Agreement, Boyer
shall be employed by the Company on the following terms and conditions.

     NOW, THEREFORE, in consideration of the mutual covenants contained herein
and in further consideration of the facts set forth above, and intending to be
legally bound hereby, the parties agree as follows:

Section 1. Employment.

     The Company shall employ Boyer, and Boyer accepts employment by the
Company, on the terms and conditions contained in this Agreement, for a period
of six (6) years commencing as of the date hereof, unless Boyer’s employment is
earlier terminated as hereinafter set forth or extended by mutual agreement of
the parties. In addition, the Company shall have the option to renew this
Agreement for a second period of six (6) years, upon the same terms and
conditions, by giving written notice of such renewal not less than ninety (90)
days prior to the expiration of the first six-year period. The period of
Boyer’s employment hereunder is sometimes hereinafter referred to as the
“Employment Period” and a “year” of employment shall refer to a.twelve (12)
month period commencing on the commencement date of the term hereof and each
anniversary of the commencement date.

Section 2. Duties and Extent of Service.

     Boyer shall serve the Company as its Chief Operating Officer and, subject
to the control and direction of the Company’s Chief Executive Officer and,
secondarily, its Board of Directors (the “Board”), shall pet-faun such services
and duties as he has heretofore perfoined for the Company, such additional
services and duties as relate to the position of Chief Operating Officer, and
consistent with such position, such services and duties as the Board may
reasonably assign or delegate to him from time to time. Boyer shall devote substantially his entire time and attention

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during regular business hours (and outside those hours, when reasonably
necessary to his duties hereunder) to, and will use his best energies and
abilities in the performance of, his duties for the Company and the promotion
of its interests. During the team of his employment hereunder, Boyer shall be
appointed a Vice President of the Company’s parent, First Federal Savings Bank
(the “Bank”) and be elected to the Bank’s Board of Directors. In addition,
Boyer shall hold such other offices within the Company or any affiliate of the
Company to which he may from time to time consent to be elected or appointed.
Boyer agrees to resign from any position he may hold at the Bank and/or on the
Bank’s Board of Directors, upon his termination of employment with the Bank.
Boyer’s duties hereunder shall be performed at the Company’s facilities in
Canonsburg, Pennsylvania, or such other locations as the Board shall reasonably
determine. Boyer shall have no authority to contract for or to obligate the
Company outside the ordinary course of the Company’s business unless the Board
shall specifically confer such authority.

Section 3. Compensation.

          (a) Base Salary. Throughout the Employment Period, Boyer shall be
entitled to receive a base salary (“Base Salary”) of $100,000 plus (i) 20% of
all commissions received by the Company from sales and/or renewals of insurance
policies to Coveralls of North America or any affiliate, franchisee or other
entity licensed to utilize the “Coveralls” trademark (collectively, the
“Coveralls Account”), and (ii) 25% of all first-year commissions generated by
Boyer and received by the Company from sales of insurance policies to new
customers of the Company. The Base Salary shall be paid as and when accrued, in
semi-monthly installments in accordance with the Company’s normal payroll
schedule. In the event of a material change during the Employment Period in
Boyer’s duties and responsibilities as the Company’s Chief Operating Officer
which results in Boyer having greater administrative obligations and being less
able to generate new commissions, the Base Salary shall be reviewed by the
Company and adjusted to reflect any such change so that Boyer will receive
compensation commensurate with that paid to executives with similar
responsibilities in comparable agencies.

          (b) Fringe Benefits. Boyer shall be entitled to health and welfare,
vacation and other employee fringe benefits, including life and disability
insurance, on an equivalent basis to senior officers of the Bank. Moreover,
throughout the term of the Agreement, Boyer shall be provided with the use of a
Company-owned or leased automobile.

Section 4. Business Expenses.

     It is understood that Boyer will, from time to time, incur reasonable
business expenses in connection with his employment. The Company will provide
an expense account for Boyer from which he shall be reimbursed for any such
expenses, provided he shall present a reasonably substantiated, itemized
written account of such expenses.

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Section 5. Disability.

          (a) Disability Defined. As used in this Agreement, the words
“disability” or “disabled” shall mean Boyer’s inability to perform his nolmal
full-time duties for the Company due to physical, mental or emotional
incapacity or impaiinient. The determination of whether Boyer currently is, or
previously was, disabled during any period of his employment shall be made by
an independent physician selected by mutual agreement of the Company and Boyer,
or if they are unable to agree on the selection of a physician, then by the
consensus of three (3) independent physicians, each of whom shall be
appropriately qualified to make the determination. One such physician shall be
selected by the Company, one by Boyer, and those two shall then select a third.
The physician or physicians shall also fix the commencement date of any period
of disability, whether currently or retroactively, and shall determine if and
when such period of disability terminates. Boyer agrees to submit to such
examinations and testing as may be reasonably necessary in order to make any
such evaluation. If a single physician is agreed upon, all costs incurred in
making such determinations, including the physician’s fees, shall be paid by
the Company. Otherwise, such costs shall be equally split between the Company
and Boyer.

          (b) Continuation of Employment: Termination. If Boyer is disabled,
his employment under this Agreement shall continue for a period of six (6)
months following the commencement of his disability. If Boyer’s disability ends
during such six-month period, he shall have the right to resume his full-time
duties for the Company. If Boyer’s disability continues for six (6) months,
then at the expiration of such six-month period, his employment and this
Agreement shall, at the Company’s option, terminate.

               For purposes of determining whether Boyer has been disabled for a period
of at least six months, if Boyer, having once been disabled, shall again be
disabled for a succeeding period or periods, such period or periods shall be
considered as continuations of the first for the purposes of this Agreement.
This rule shall not apply, however, and a new period of disability shall be
commenced, if either of the following conditions is met:

               (1) Boyer returns to full-time duty for three consecutive months between
any two periods of disability; or

               (2) A determination is made that the causes of the periods of disability
are unrelated. Such determination shall be made in the same manner as set forth
in the preceding section 5(a) relating to the determination of disability.

          (b) Disability Insurance. Any disability insurance benefits which
Boyer receives directly from an insurance carrier which are payable under a
policy which has been financed by the Company shall reduce, dollar for dollar,
Boyer’s salary during his disability. The Company agrees, however, that any
such insurance payments received by the Company or Boyer after Boyer’s right to
receive salary under this Agreement shall have terminated shall be the
property of Boyer and, if received by the Company, shall be promptly paid over
to Boyer.

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Section 6.
Proprietary Information, Loyalty and Non-Competition.

          (a) Confidentiality. Boyer acknowledges that the Company now has
and will develop in the future, and that Boyer has learned and will learn in
the future, valuable Proprietary Information (as defined below) relating to the
business of soliciting, selling, renewing, negotiating and placing insurance
policies and related products and services (the “Business”). Boyer covenants
and agrees to keep the Proprietary Information in confidence and to use his
best efforts, for as long as this Agreement remains in effect and for a period
(the “Restriction Period”) commencing on the date hereof and ending five (5)
years after the date on which Boyer ceases to be employed by the Company (the
“Termination Date”), to prevent its dissemination other than
in the normal and proper course of his duties or as authorized in writing by
the Company’s Board. Boyer further covenants and agrees to use the Proprietary
Information exclusively for the benefit of the Company during the Restriction
Period.

          (b) Proprietary Information. “Proprietary Information” shall
include, but not be limited to, the following types of information regarding
the Company: corporate information, including contractual arrangements, plans
and strategies; marketing information, including sales or product plans,
strategies, tactics, methods, prospects, market research data, customer and
potential customer lists; financial information, including cost and performance
data; and operational information, including manufacturing processes and
methods, trade secrets, and technical data; and personal information, including
personnel lists. Proprietary Information includes, and is limited to, that
information which is not generally known and is protected as confidential by
the Company using reasonable efforts, and does not include general skills,
knowledge, personal contacts and experience acquired by Boyer prior to and
during his employment with the Company. Any Proprietary Information developed
by Boyer during the term of this Agreement shall be the property of the
Company.

          (c) Non-Solicitation. Boyer agrees that during the Restriction
Period, he shall not, directly or indirectly, for his own account or as agent,
servant or employee of any business entity, offer to hire or entice away or in
any other manner persuade or attempt to persuade any officer or employee of the
Company to discontinue or otherwise materially and adversely alter the terms of
his or her relationship with the Company.

          (d) Corporate Documents. Boyer agrees that all documents of any
nature pertaining to activities of the Company or to any of the foregoing
matters in his possession at any time, including, without limitation,
memoranda, notebooks, notes, data sheets, and records, are and shall be the
property of the Company and that they and all copies of them shall be
surrendered to the Company whenever requested by the Company from time to time
and with or without request upon termination of Boyer’s
employment.

          (e) Non-Competition. Boyer agrees and covenants that he will not,
directly or indirectly, whether as an officer, director, consultant, employee,
representative, agent, owner (other than as an owner of less than a 5% interest
of a publicly traded company) or otherwise, (i) during the Non-Compete Period
(as defined below), engage in providing services to any

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Competing Business
within a seventy-five (75) mile radius of any office maintained by the Company
on the date hereof or on the Termination Date, or (ii) during the Restriction
Period, solicit business from, or market services or products to, any person or
entity which was, during a period of one (1) year prior to the Termination
Date, a customer of the Company, with respect to the Business or with respect
to any other products or services offered by the Company (or which the Company
made plans or took preparatory steps to offer) during the aforesaid one-year
period. “Competing Business” means the solicitation, sale, renewal, negotiation
or placement of insurance policies and related products and services. “Non
Compete Period” means the period commencing on the date hereof and ending on
the later of (i) the fifth anniversary of the date hereof, or (ii) in the case
of a termination of this Agreement without Cause by the Company pursuant to
Section 7(d) hereof or a Just Cause Termination as defined in Section 7(f)
hereof, the date on which the Company ceases to pay Boyer’s Base Salary in
accordance with Section 7(f) hereof, and in the case of any other termination
of this Agreement, the date which is two (2) years after the Termination Date.

          (f) Severability. It is the parties’ express intention that if a
court of competent jurisdiction finds or holds any provision of this section 6
to be excessively broad as to time, duration, geographical scope, activity or
subject, such provision shall then be construed by limiting or reducing it so
as to comport with then applicable law. In the event any such provision cannot
be limited or reduced so as to comport with then applicable law, then such
provision of this section 6 shall be severable from all other provisions of
this section 6, and the other provisions of this section 6 shall continue to be
enforceable to the fullest extent allowable.

          (g) Injunctive Relief. It is hereby acknowledged and agreed by the
parties that Boyer’s violation of any of the provisions of this section 6 shall
severely damage the Company’s business, and the parties recognize that such
damage shall be difficult to precisely determine. Therefore, it is expressly
agreed that the Company, in addition to any other remedies it may have, shall
be entitled to injunctive relief against Boyer in the event of any such breach.

Section 7. Termination.

          (a) Death of Boyer. This Agreement shall automatically teuininate
upon Boyer’s death.

          (b) Disability of Boyer. This Agreement shall, at the Company’s
option, terminate in
accordance with section 5 relating to Boyer’s disability.

          (c) Company Termination For Cause. The Company may terminate the
employment of Boyer for Cause if:

               (i) the Company notifies Boyer in writing, referencing this section, of
the conduct for which termination for Cause is justified; and

               (ii) Boyer fails within thirty (30) days of receipt of such notice to
cure,

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on a prospective basis, to the reasonable satisfaction of the Company,
the conduct specified in such notice; provided, however, that such thirty-day
cure period shall not be required where the conduct of Boyer falls within item
C or D of the definition of Cause set forth below.

          For purposes of this section 7(c), Cause shall be determined by the Board
of Directors of the Company in good faith and shall mean any of the following
which is materially and demonstrably injurious to the interest, property,
operations, business or reputation of the Company or its subsidiaries or
affiliates:

               A. Boyer’s material breach of the terms of this Agreement;

               B. Boyer’s continuing inattention to, or neglect of, the material duties
to be performed by him, other than by reason of his illness or disability;

               C. Boyer’s engaging in material acts of disloyalty (in breach of a legal
duty) or dishonesty (in violation of criminal law) toward the Company; or

               D. Boyer’s engaging in conduct which has materially injured the business
or reputation of the Company, or which has otherwise materially and adversely
affected its interests, or which reasonably could be expected to so injure its
business or reputation or so affect its interests if Boyer were retained as an
employee.

          (d) Company Termination Without Cause. The Company may tell linate
the employment of Boyer without Cause upon at least sixty (60) days prior
written notice to Boyer. Boyer shall continue to perform his normal duties
during the notice period, provided that the Board shall have the right to
release Boyer from such obligation and to accelerate the Termination Date.

          (e) Boyer Termination. Boyer may resign his employment prior to the
expiration of the Employment Period upon at least sixty (60) days prior written
notice to the Company. Boyer shall continue to perform his normal duties during
the notice period, provided that the Board shall have the
right to release Boyer from such obligation and to accelerate the
effective date of his resignation.

          (f) Effect of Termination. Upon termination of this Agreement and
Boyer’s employment by the Company hereunder pursuant to subsections (a) through
(e) above, all obligations of the Company under this Agreement, except as
provided in Section 9, shall cease except that in the event of a termination of
this Agreement as a result of (i) Boyer’s disability, (ii) a termination
without Cause by the Company or (iii) Boyer’s Just Cause Termination (as
hereinafter defined), the Company shall make monthly payments to Boyer for a
period commencing on the Termination Date and ending at the scheduled
expiration of the Employment Period (excluding any renewal thereof, if the
Company has not then elected to renew the Employment Period for an additional
six years) equal to the sum of (A) Boyer’s monthly Base Salary, plus (B) the
average monthly commissions paid to Boyer during the twelve-month period

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ending
on the termination date (or, if Boyer’s disability occurs during the first year
of this Agreement, then the average monthly commissions paid during the full
period of his Employment) and Boyer shall continue to be eligible for the
fringe benefits outlined in Section 3 hereof for the remainder of the
Employment Period. “Just Cause Termination” means a termination by Boyer of his
employment with the Company which becomes effective within six (6) months
following any material change in the terms and conditions of Boyer’s employment
imposed by the Company (including, without limitation, changes in compensation,
duties and responsibilities, or work location) and not consented to in writing
by Boyer.

          (g) Applicable Taxes. All payments made after Boyer’s termination
of employment shall be subject to whatever taxes the Company is required by law
to withhold or pay from such amounts.

Section 8. Disputes.

     Any controversy or claim arising out of or relating to this Agreement, or
the breach hereof, including, without limitation, any dispute concerning
whether Boyer may properly be terminated for Cause, shall be settled by a
single arbitrator in arbitration with the American Arbitration Association
conducted in Pittsburgh, Pennsylvania, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, and judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. The arbitrator’s decision shall be in writing and shall
be fmal and nonappealable. The arbitrator’s authority shall include the ability
to render equitable types of relief and, in such event, any aforesaid court may
enter an order enjoining and/or compelling such actions as found by the
arbitrator. Notwithstanding the foregoing, the Company shall not be required to
submit to arbitration any request for injunctive or other equitable relief for
violation or alleged violation by Boyer of the provisions of section 6 hereof.
In the event of arbitration or litigation with respect to Boyer’s rights under
this Agreement, the prevailing party in such action (as determined by the
arbitrator or court, as the case may be) shall be entitled to recover from the
other party its reasonable attorneys’ fees and costs and expenses associated
with the proceedings.

Section 9. Survival.

     The parties acknowledge that certain of the provisions of this Agreement
have continued applicability despite the termination of Boyer’s employment
hereunder. Therefore, the parties agree that the termination of Boyer’s
employment shall not teiininate this Agreement as it pertains to any liability
or other obligation which shall have accrued hereunder up to and including the
date of termination, and the parties shall carry out and be bound by any
provisions hereof which contemplate performance by them subsequent to such
teimination.

Section 10. Indemnification.

     The Company shall defend and hold Boyer harmless to the fullest extent
permitted by applicable law in connection with any civil or criminal claim,
action, suit, investigation or

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proceeding arising out of or relating to
performance by Boyer of services for, or action of Boyer as a director, officer
or employee of the Company, or of any other person or enterprise at the request
of the Company. Expenses incurred by Boyer in defending any such claim, action,
suit, investigation or proceeding shall be paid by the Company in advance of
the final disposition thereof upon the receipt by the Company of an undertaking
by or on behalf of Boyer to repay said amount if it shall ultimately be
determined that Boyer is not entitled to be indemnified hereunder. The
foregoing shall be in addition to, and shall not be deemed to limit in any
respect, any indemnification rights Boyer may have by law, contract, charter,
by-law or otherwise.

Section 11. Entire Agreement.

     This Agreement shall constitute the entire agreement between the Company
and Boyer with respect to Boyer’s employment by the Company, and supersedes all
prior agreements, if any, whether written or oral, between them, relating
thereto. This Agreement may be amended or altered only by the written agreement
of the Company and Boyer.

Section 12. Notice.

     Any notice to be given hereunder shall be deemed given when personally
delivered to the party to receive such notice, or when mailed, postage prepaid,
by registered or certified mail, or by express delivery service, if to the
Company, to its principal office to the attention of an executive officer other
than Boyer, with a copy to the Bank at P. O. Box 369, Donner at Sixth,
Monessen, Pennsylvania 15062, Attention: President, and if to Boyer, to his
residence address
appearing on the books of the Company. Such addresses may be changed by notice
in writing to the other party as aforesaid.

Section 13. Binding Effect.

     This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto, the successors and assigns of the Company, and the heirs and
personal representatives of Boyer, but neither this Agreement nor any of the
rights hereunder shall be assignable or delegable by Boyer.

Section 14. Severability.

     Each provision of this Agreement is severable from the others, and if any
provision hereof shall be to any extent unenforceable, it and the other
provisions hereof shall continue to be enforceable to the full extent
allowable.

Section 15. Interpretation.

     This Agreement shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed the day and year first above written.

	 	 	 
	ATTEST:

	 	EXCHANGE UNDERWRITERS, INC.
	 
	 	 
	/s/Richard B. Boyer

	 	By: /s/Richard B. Boyer
	

	 	

	

	 	Name: Richard B. Boyer
	

	 	Title: President
	 
	 	 
	WITNESS:

	 	BOYER:
	 
	 	 
	/s/ Marilyn Faysor

	 	/s/Richard B. Boyer
	

	 	

	

	 	Richard B. Boyer

9exv10w17

 

EXHIBIT 10.17

LEASE AGREEMENT

     THIS LEASE AGREEMENT (“Lease”) is made as of the 1st day of June, 2002, by
and between RICHARD B. and WENDY A. BOYER (“Lessor”), and EXCHANGE
UNDERWRITERS, INC., a Pennsylvania corporation (“Tenant”).

WITNESSETH:

     WHEREAS, in consideration of the rents, covenants and agreements
hereinafter set forth, the parties hereto do enter into the following
agreement:

ARTICLE 1

LEASED PREMISES AND TERM

     1.1 Leased Premises.

          Lessor hereby leases to Tenant, and Tenant hereby rents from Lessor, all
of the following property owned by Lessor and located in Canonsburg, Washington
County, Pennsylvania: (i) all that certain lot on which the Building (as
defined below) is located, as more fully described on Exhibit A attached hereto
(the “Land”), and (ii) that certain office building known and numbered as 121
West Pike Street, Canonsburg, Pennsylvania (the “Building and collectively with
the Land. the “Premises”).

     1.2 Lease Term.

          The term of this Lease shall commence on June 1, 2002 and shall end on May
31, 2007 (the “Lease Term”). Tenant shall have the option to renew the Lease
for one additional five (5)-year period, upon all of the terms set forth
herein, but at a market rental determined by an independent qualified real
estate appraiser, the expense of which shall be equally shared by Lessor and
Tenant. Tenant shall exercise the option by giving Lessor written notice
thereof at least ninety (90) days prior to the expiration of the initial
five-year term.

ARTICLE 2

RENT

     2.1 Minimum Rent.

     During the initial five-year Lease Term, Tenant covenants and agrees to
pay to Lessor, without notice, demand, counterclaim or setoff, at Lessor’s
address for notices specified herein, as rent (“Minimum Monthly Rent”) for the
Premises an amount equal to One Thousand Four Hundred Thirty-Five and 16/100
($1,435.16) per month. Minimum Monthly Rent shall be payable in advance of the
first day of the Lease Term and on the first day of each and every calendar
month thereafter during the
Lease Term. The payment shall be proratably reduced in the case of any
partial calendar month for which such payment is made.

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     2.2 Miscellaneous Rent Provisions.

          All Minimum Monthly Rent payments and all other amounts to be paid by
Tenant hereunder (“Additional Rent”) which are not paid within five (5) days of
the date thereof shall be subject to late charge of five percent (5%) of the
amount due.

     2.3 Real Estate Taxes.

          Lessor shall, throughout the Lease Term, pay all real estate taxes (as
hereinafter defined) assessed or imposed upon the Premises.

     2.4 Lessor’s Expenses.

          If Lessor pays any monies or incurs any expense to correct a breach of
this Lease by Tenant or to do anything in this Lease required to be done by
Tenant, or incurs any expense (including, but not limited to, attorneys’ fees
and court costs) as a result of Tenant’s failure to perform any of Tenant’s
obligations under this Lease, all amounts so paid or incurred shall. after five
(5),days’ notice to Tenant, be considered Additional Rent payable by Tenant
with the first Minimum Monthly Rent installment thereafter becoming due and
payable, and may be collected as provided by law in the case of rent.

ARTICLE 3

UTILITIES

     Tenant shall pay as Additional Rent hereunder all charges for steam.
electricity. gas, water, sewer, telephone service and other utilities furnished
to the Premises, whether furnished by Lessor or directly by a utility company.
Tenant covenants that all such charges shall be promptly paid directly to the
providers of such services when due and shall indemnify and hold Lessor
harmless from any fees, charges or assessments by any such utility company. In
the event that Lessor is required to pay any utility service fees for the
Premises, such fees shall be deemed Additional Rent hereunder.

ARTICLE 4

CONDUCT OF BUSINESS BY TENANT

     4.1 Use of Premises.

          The Premises shall be occupied and used by Tenant solely as office space,
and Tenant shall not use or permit or suffer the use of the Premises for any
other business or purpose.

     4.2 Operation by Tenant.

          Tenant covenants and agrees that it will: store garbage, trash, rubbish
and other

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refuse in proper waste containers on the Premises, and remove the
same frequently and regularly and, if directed by Lessor, by such means and
methods and at such times and intervals as are designated by Lessor. all at
Tenant’s cost; not permit any objectionable advertising medium visible or
audible outside the Premises: keep all mechanical equipment in good working
order and condition; not commit or permit waste or nuisance upon the Premises,
not permit or cause unpleasant odors or unreasonable noise to emanate or be
dispelled from the Premises; comply with all laws, ordinances, rules and
regulations of governmental, public, private and other authorities and agencies
with respect to the use or occupancy of the Premises, and including but not
limited to the Williams-Steiger Occupational Safety and Health Act; not permit
any noxious, toxic or corrosive fuel or gas, dust, dirt or fly ash on the
Premises; not place a load on any floor of the Premises which exceeds the floor
load per square foot which such floor was designed to carry.

     4.3 Painting, Decorating, Displays, Alterations.

          Tenant will not, without Lessor’s prior written consent, paint, decorate
or change the architectural treatment of any part of the exterior of the
Premises nor any part of the interior of the Premises visible from the exterior
nor make any structural alterations, additions or changes in the Premises, and
will promptly remove any paint, decoration, alteration, addition or changes
applied or installed without Lessor’s approval and restore the Premises to an
acceptable condition or take such other action with respect thereto as Lessor
directs.

     4.4 Liability of Lessor.

          Lessor shall not be liable to Tenant or to Tenant’s employees, agents,
licensees, invitees or visitors, or to any other person whomsoever. for (i) any
injury or damage to person or property occurring in. on, over or under the
Premises or any part thereof; whether arising from latent or patent defects, or
from repair or defect in or failure of: pipes or wiring, or the backing up of
drains or the bursting or leaking of pipes. faucets, and plumbing fixtures. or
gas. water, steam. electricity or oil leaking, escaping, or flowing into the
Premises, unless caused by the negligence or willful misconduct of Lessor; or
(ii) any loss or damage to any property or person occasioned by theft, fire,
act of God. public enemy, injunction, riot, insurrection, war. court order.
requisition, or order of governmental authority, or any other matter beyond the
control of Lessor. Tenant agrees that all personal property upon the Premises
shall be at the risk of Tenant only, and that Lessor shall not be liable for
any damage thereto or theft thereof.

     4.5 Tenant’s Indemnification of Lessor.

          Tenant agrees that it will indemnify and hold and save Lessor whole and
harmless of, from and against (i) all fines, suits, loss, cost, liability,
claims, demands. actions. and judgments of every
kind and character by reason of any breach, violation, or nonperformance
of any term, provision, covenant, agreement, or condition on the part of Tenant
hereunder; and (ii) all claims, demands, actions, damages, loss, cost,
liabilities, expenses, and judgments suffered by, recovered from or asserted
against Lessor on account of injury or damage to person or

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property to the
extent that any such damage or injury may be incident to, arise out of. or be
caused, either proximately or remotely, wholly or in part, by an act, omission,
negligence, or misconduct on the part of Tenant or any of its agents, servants,
employees, contractors, patrons, guests, licensees, or invitees or of any other
person entering upon the Premises under or with the express or implied
invitation or permission of Tenant or when any such injury or damage is the
result, proximate or remote, of the violation by Tenant or any of its agents.
servants, employees, contractors, patrons, guests. licensees, or invitees of
any law, ordinance, or governmental order of any kind, or when any such injury
or damage may in any other way arise from or out of the occupancy or use by
Tenant, its agents, servants, employees, contractors, patrons, guests,
licensees, or invitees, of the Premises.

     4.6 Certain Rights Reserved By Lessor.

          Lessor shall have the following rights, exercisable without notice and
without liability to Tenant for damage or injury to property, persons, or
business and without effecting an eviction, constructive or actual, or
disturbance of Tenant’s use or possession or giving rise to any claim for
setoff or abatement of rent:

          A. To retain at all times, and to use in appropriate instances, keys to
all doors within and into the Premises. No locks shall be changed or added
without the prior written consent of Lessor.

          B. To have and retain a paramount title to the Premises free and clear of
any act of Tenant purporting to burden or encumber them.

ARTICLE 5

MAINTENANCE OF LEASED PREMISES

     5.1 Repairs.

          Lessor shall be responsible for major structural repairs to the Premises
(such as roof. exterior walls, foundation and parking areas) and, unless this
Lease is terminated pursuant to Section 5.4 below, repairs and replacements
necessitated by fire and other casualties. All other repairs (including,
without limitation, repairs to the principal systems relating to the Premises,
such as HVAC, plumbing and electrical) shall be the responsibility of Tenant.

     5.2 Maintenance by Tenant.

          Except as otherwise provided in Section 5.1 above, Tenant shall at all
times keep the Premises (including all entrances. vestibules, sidewalks and
outside areas) and all equipment, partitions, window and window frames and
moldings, glass, doors, door openers and fixtures in good order, condition and
repair and clear, orderly, sanitary and safe. damage by unavoidable casualty
excepted (including, but not limited to, doing such things as are necessary to
cause the Premises to comply with applicable laws, ordinances, rules,
regulations and orders of

4

 

governmental and public bodies and agencies). If
replacement of equipment. fixtures and appurtenances located therein is
necessary, Tenant shall replace the same with new equipment, fixtures and
appurtenances, and repair any and all damage done in or by such replacement.
Tenant shall maintain the grass and grounds, and keep the sidewalks and outside
areas surrounding the Building free from snow, ice, or any other obstructions
and maintain said areas in a safe condition. If Tenant fails to perform its
obligations hereunder, Lessor may (but shall not be obligated to), after thirty
(30) days notice, perform Tenant’s obligations or perform work resulting from
Tenant’s acts or omissions and add the cost of the same to the next installment
of Minimum Monthly Rent due hereunder. If the obligation to be performed is of
a nature requiring action before the expiration of thirty (30) days, such
notice will not be required.

     5.3 Surrender of Premises.

          At the expiration of the Lease Term, Tenant shall surrender the Premises
in the same condition as they were in on the commencement date, reasonable wear
and tear and damage by casualty excepted, and deliver all keys for, and all
combinations of locks, safes and vaults in, the Premises to Lessor at Lessor’s
notice address.

     5.4 Casualty.

          Should the Premises be damaged, destroyed or rendered unfit, wholly or
partially, for use and occupancy by fire or other casualty, Lessor shall, at
its option, either promptly replace or repair the same, or terminate this
Lease, or permit Tenant to replace or repair the same if Tenant should so
desire. If the damage is such that restoration within ninety (90) days is not
feasible, then Tenant shall have the right to terminate this Lease. Rent shall
be proratably abated during any period of restoration.

     5.5 Condemnation.

          If during the Lease Term, all of the Premises should be taken for any
public or quasi-public use under any law, ordinance, or regulation or by right
of eminent domain, or should the Premises be sold to the condemning authority
under threat of condemnation, this Lease shall terminate and the rent shall be
abated during the unexpired portion of this Lease, effective as of the date of
the taking of possession of the Premises by the condemning authority.

          If less than all of the Premises shall be taken for any public or
quasi-public use under any
law, ordinance or regulation. or by right of eminent domain. or should be
sold to the condemning authority under threat of condemnation, at Lessor’s
option this Lease shall not terminate, but Lessor shall forthwith at its sole
expense restore and reconstruct the Building and other improvements situated on
the Premises, provided such restoration and reconstruction shall make the same
reasonably tenantable and suitable for the uses for which the Premises are
leased. The rent payable hereunder during the unexpired portion of this Lease
shall be adjusted equitably.

5

 

          In any event, any condemnation award, or purchase price in lieu thereof,
for the taking of all or any portion of the Premises shall be the property of
Lessor whether such award or purchase price shall be made as compensation for
diminution in value of the leasehold or for the taking of the fee, and Tenant
hereby assigns to Lessor all its right, title and interest in and to any such
award or purchase price. Nothing contained herein. however, shall be deemed to
preclude Tenant from obtaining, or to give Lessor any interest in, any award to
lessee for moving expenses or for loss of or damage to Tenant’s fixtures,
equipment or other property or for damages for cessation or interruption of
Tenant’s business.

ARTICLE 6

INSURANCE

     Tenant agrees to carry public liability insurance on the Premises during
the Lease Term, covering the Tenant and naming the Lessor as an additional
named insured. with terms and companies satisfactory to Lessor, with limits of
not less than $1,000,000 for bodily injury, including death, and personal
injury for any one occurrence, $500,000 property damage insurance, or a
combined single limit of $1,000,000. Tenant’s insurance will include
contractual liability coverage recognizing this Lease, and provide that Lessor
and Tenant shall be given a minimum of thirty (30) days written notice by the
insurer prior to cancellation, termination or reduction in such insurance
coverages. Lessor shall carry insurance against fire and other risks of
physical loss or damage to the Premises in the amount of the full replacement
value thereof. All of the insurance coverages carried by Lessor and Tenant
shall waive subrogation with respect to the other party. Each party shall, from
time to time upon request, provide the other party with certificates or copies
of the policies, evidencing that such insurance is in full force and effect and
stating the terms thereof

ARTICLE 7

ASSIGNMENT, SUBLETTING AND CONCESSIONS

Tenant shall not sell, assign, mortgage, pledge or in any manner transfer this
Lease or any interest therein, nor sublet all or any part of the Premises, nor
license concessions nor lease departments therein, without the prior written
consent of Lessor, which shall not be unreasonably withheld.

ARTICLE 8

DEFAULT BY TENANT

     8.1 Right to Re-Enter.

          The following shall be considered for all purposes to be defaults under
and breaches of this Lease: (a) any failure of Tenant to pay any Minimum
Monthly Rent or Additional Rent within ten (10) days after the due date
thereof: (b) any failure by Tenant to perform or observe any of the other
terms, provisions, conditions and covenants of this Lease for more than ten
(10) days after written notice from Lessor of such failure; (c) the bankruptcy
or insolvency of Tenant or the filing by or against Tenant of a petition in
bankruptcy or for

6

 

reorganization or arrangement or for the appointment of a
receiver or trustee of all or a portion of Tenant’s property. or Tenant’s
assignment for the benefit of creditors; (d) if Tenant abandons or vacates or
ceases to conduct its business on the Premises; (e) this Lease or Tenant’s
interest herein or in the Premises are executed upon or attached; or (f) the
Premises come into the hands of any person other than as expressly permitted
under this Lease, through fault of Tenant. In any such event, Lessor, in
addition to all other rights or remedies it may have, shall have the right
thereupon or at any time thereafter to terminate this Lease by giving notice to
Tenant stating the date upon which such termination shall be effective, and
shall have the right, either before or after any such termination, to re-enter
and take possession of the Premises, remove all persons and property from the
Premises, store such property at Tenant’s expense, and sell such property if
necessary to satisfy any deficiency in payments by Tenant as required
hereunder, all without notice or resort to legal process and without being
deemed guilty of trespass or becoming liable for any loss or damage occasioned
thereby.

     8.2 Acceleration.

          Besides all other rights or remedies it may have by law or in equity,
Lessor shall have the right, upon default by Tenant hereunder: (i) to declare
all rent and other payments for the entire unexpired term of this Lease at once
due and payable and, if not paid forthwith upon Lessor’s demand, then to resort
to legal process for collection of all accelerated payments due under this
Lease; or (ii) to terminate this Lease and resort to legal process for
collection of damages and/or eviction; or (iii) re-enter and attempt to relet
without terminating this Lease and remove all persons and property from the
Premises, and to remove and store such property in a public warehouse or
elsewhere at the cost of and for the account of Tenant, all without service of
notice or resort to legal process and without being deemed guilty of trespass,
or becoming liable for any loss or damage which may be occasioned thereby.

     8.3 Right to Relet.

          If Lessor re-enters the Premises as above provided, or if it takes
possession pursuant to legal proceedings or otherwise, it may either terminate
this Lease or it may. from time to time, without terminating this Lease, make
such alterations and repairs as it deems advisable to relet the Premises, and
relet the Premises or any part thereof for such term or terms (which may extend
beyond the Lease Term) and at such rentals and upon such other terms and
conditions as Lessor in its sole discretion deems
advisable: upon each such reletting, all rentals received by Lessor
therefrom shall be applied, first, to any indebtedness other than rent due
hereunder from Tenant to Lessor; second, to pay any costs and expenses of
reletting, including brokers’ and attorneys’ fees and costs of alterations and
repairs; third, to rent due hereunder. and the residue, if any, shall be held
by Lessor and applied in payment of future rent as it becomes due hereunder. If
rentals received from such reletting during any month are less than that to be
paid during that month by Tenant hereunder. Tenant shall immediately pay any
such deficiency to Lessor. No re-entry or taking possession of the Premises by
Lessor shall be construed as an election to terminate this Lease unless a
written notice of such termination is given by Lessor.

7

 

ARTICLE 9

ACCESS BY LESSOR

     Lessor, its agents and employees, shall have the right to enter the
Premises from time to time at reasonable times, in such manner as not to
interfere with Tenant’s operations, to examine the same, show them to
prospective purchasers and other persons, and make (without any obligation to
do so) such repairs, alterations, improvements or additions as Lessor deems
desirable. Rent shall not abate while any such repairs, alterations,
improvements or additions are being made. In addition, during any apparent
emergency, Lessor or its agent may enter the Premises forcibly, and at any
time, without liability therefor and without in any manner affecting Tenant’s
obligations under this Lease. Nothing herein contained, however, shall be
deemed to impose upon Lessor any obligation, responsibility or liability
whatsoever for any care, maintenance or repair. except as otherwise herein
expressly provided.

ARTICLE 10

HOLDING OVER, SUCCESSORS

     10.1 Holding Over.

          If Tenant holds over or occupies the Premises beyond the Lease Term,
Tenant shall pay Lessor a sum equal to 125% of the Minimum Monthly Rent,
prorated for the number of days of such holding over.

     10.2 Successors.

          All rights and liabilities herein given to or imposed upon the respective
parties hereto shall bind and inure to the several respective successors and
permitted assigns of the parties. Lessor, at any time and from time to time,
may make an assignment of its interest in this Lease and, in the event of such
assignment, Lessor and its successors and assigns (other than the assignee of
Lessor’s interest in this Lease) shall be released from any and all liability
thereafter accruing hereunder.

ARTICLE 11

QUIET ENJOYMENT

     If Tenant pays the rents and other amounts herein provided, observes and
performs all the covenants. terms and conditions hereof, Tenant shall peaceably
and quietly hold and enjoy the Premises for the Lease Term without interruption
by Lessor or any person or persons claiming by, through or under Lessor,
subject, nevertheless, to the terms and conditions of this Lease.

8

 

ARTICLE 12

PURCHASE OPTION

     12.1 Grant of Option.

          At any time during the Lease Term, Tenant shall have the right and option
to purchase the Premises, at a price determined in the manner set forth below:

          A. If Tenant wishes to exercise its option, Tenant shall notify Lessor in
writing of its interest in purchasing the Premises.

          B. Within thirty (30) days of Lessor’s receipt of such notice, the parties
shall either (i) mutually agree upon the value of the Premises, or (ii)
mutually agree upon the selection of a certified appraiser to determine such
value. In the event that they are unable to so agree, then the Lessor shall
appoint one certified appraiser, the Tenant shall appoint another, and the two
appraisers so selected shall appoint a third. Each such appraiser shall, within
thirty (30) days of his appointment, submit a written appraisal, and the three
appraisals shall be averaged. Thereafter, the appraisal which varies the most
from the average shall be disregarded, and the remaining two appraisers shall
be averaged. The result shall be the value of the Premises.

          C. Within ten (10) days after determination of the value of the Premises
(the “Determined Value”). Tenant shall notify Lessor in writing as to whether
Tenant wishes to exercise its purchase option at a price equal to the
Determined Value. Such notice shall legally bind the Lessor to sell, and the
Tenant to purchase, the Premises upon the terms and conditions set forth in
Section 12.2 below.

     12.2 Terms of Purchase and Sale.

          The consummation of the purchase and sale of the Premises (the “Closing’’)
shall be held under the following conditions:

          A. At the Closing, the purchase price shall be payable to Lessor by
certified or cashier’s check or by wire transfer. Tenant shall receive no
credit for rent paid to Lessor during the Lease Term.

          B. The Closing shall be held within thirty (30) days of the date of
Tenant’s notice to Lessor of Tenant’s election to purchase described in Section
12.1 C, and shall be at such time and place as is agreed by the parties.

          C. At the Closing, Lessor shall, by general warranty deed, grant and
convey to Tenant, in fee simple, free and clear of all liens and encumbrances
(except any restrictions, reservations, easements and rights of way of record,
none of which shall materially impair the use of the Premises), good and
marketable title (and such as will be insurable by any responsible title
insurance company at regular rates) to the Premises.

          D. The conveyance shall be made together with all improvements and all
easements and appurtenances appertaining.

9

 

          E. Realty transfer taxes shall be equally shared by the parties, and all
costs in connection with obtaining title insurance, recording fees and similar
charges shall be paid in accordance with local real estate practice.

          F. Tenant shall pay all Minimum Monthly Rent and Additional Rent up to the
date of Closing.

ARTICLE 13

MISCELLANEOUS

     13.1 Waiver.

          No waiver by Lessor or Tenant of any breach of any term, covenant or
condition hereof shall be deemed a waiver of the same or any subsequent breach
of the same or any other term, covenant or condition. The acceptance of rent by
Lessor shall not be deemed a waiver of any earlier breach by Tenant of any
term, covenant or condition hereof, regardless of Lessor’s knowledge of such
breach when such rent is accepted. No covenant, term or condition of this Lease
shall be deemed waived by Lessor or Tenant unless waived in writing.

     13.2 Entire Agreement.

          There are no representations, covenants, warranties, promises, agreements,
conditions or undertakings, oral or written, between Lessor and Tenant other
than herein set forth. Except as herein otherwise provided, no subsequent
alteration, amendment, change or addition to this Lease shall be binding upon
Lessor or Tenant unless in writing and signed by them.

     13.3 Force Majeure.

          If either party hereto shall be delayed or hindered in or prevented from
the performance of any act required hereunder by reason of strikes, lockouts,
labor troubles, inability to procure material, failure of power, restrictive
governmental laws or regulations, riots, insurrection, war or other reason of a
like nature not the fault of the party delayed in performing work or doing acts
required under this Lease (excluding, however, the obligation of Tenant to pay
Minimum Rent or Additional Rent hereunder), the period for the performance of
any such act shall be extended for a period equivalent to the period of such
delay.

     13.4 Notices.

          All notices from Tenant to Lessor required or permitted by any provision
of this Lease shall be directed to Lessor as follows:

          Richard B. Boyer

          Wendy A. Boyer

          132 Beverly Road

          Pittsburgh, PA 15216

10

 

          All notices from Lessor to Tenant required or permitted hereunder shall be
directed as follows:

          Exchange Underwriters, Inc.

          121 West Pike Street

          Canonsburg, PA 15317

          Attn: President

     With a copy to:

          First Federal Savings Bank P.O. Box 369

          Donner at Sixth

          Monessen, PA 15062

          Attn: President

All notices to be given hereunder by either party shall be in writing and
delivered in person or sent by registered or certified mail. return receipt
requested, postage prepaid, or by an express delivery service, addressed to the
party intended to be notified at the address set forth above. Either party may,
at any time, or from time to time. notify the other in writing of a substitute
address for that above set forth, and thereafter notices shall be directed to
such substitute address. Notice given as aforesaid shall be sufficient service
thereof and shall be deemed given as of the date delivered, when personally
delivered, or on the third business day after being sent by registered or
certified mail, or on the first business day after being sent by express
delivery service.

     13.5 Captions and Section Numbers.

          This Lease shall be construed without reference to titles of articles and
sections, which are inserted only for convenience of reference.

     13.6 Applicable Law.

          This Lease shall be construed under the laws of the Commonwealth of
Pennsylvania.

     13.7 Subordination.

          This Lease and all rights of Tenant hereunder are subject and subordinate
(i) to any mortgage or deed of trust which does now or may hereafter affect the
Premises and (ii) to any and all increases, renewals, modifications,
consolidations, replacements, and extensions of any such mortgage. This
provision is hereby declared by Lessor and Tenant to be self-operative and no
further instrument shall be required to effect such subordination of this
Lease. Tenant shall, however. upon demand at any
time or times execute, acknowledge. and deliver to Lessor any and all
instruments and certificates that may be necessary or proper to more
effectively subordinate

11

 

this Lease and all rights of Tenant hereunder to any
such mortgage or deed of trust or to confirm or evidence such subordination. In
the event Tenant shall fail or neglect to execute, acknowledge, and deliver any
such subordination agreement or certificate, Lessor may, in addition to any
other remedies it may have, as the agent and attorney-in-fact of Tenant,
execute, acknowledge, and deliver the same and Tenant hereby irrevocably
nominates, constitutes and appoints Lessor as Tenant’s proper and legal agent
and attorney in fact for such purposes. Tenant covenants and agrees, in the
event any proceedings are brought for the foreclosure of any such mortgage or
deed of trust, to attorn to the purchaser upon any such foreclosure sale or
trustee’s sale if so requested by such purchaser and to recognize such
purchaser as the Lessor under this Lease.

     13.8 Estoppel Certificate.

          Tenant will, at any time and from time to time, upon not less than twenty
(20) days’ prior notice by Lessor, execute, acknowledge, and deliver to Lessor
a statement in writing executed by Tenant certifying that this Lease is the
entire agreement between the parties and is unmodified and in full effect (or,
if there have been modifications, that this Lease is in full effect as
modified, and setting forth such modifications) and the date to which the rent
has been paid, that the Tenant has accepted the Premises, and either stating
that to the knowledge of the signer of such certificate, no default exists
hereunder or specifying each such default of which the signer may have
knowledge; it being intended that any such statement by Tenant may be relied
upon by any prospective purchaser or mortgagee of the Premises.

     13.9 Memorandum of Lease.

          Upon the request of either party, Lessor and Tenant shall execute a
Memorandum of Lease with respect to this Lease, and record the same in the
office of the real estate records where the Premises are located.

     IN WITNESS WHEREOF, Lessor and Tenant have signed and sealed this Lease
Agreement as of the day and year first above written.

	 	 	 	 	 
	LESSOR:	 	TENANT:

EXCHANGE UNDERWRITERS, INC.
	 
	 	 	 	 
	/s/Richard B. Boyer

	 	By:
	 	/s/Richard B. Boyer
	

	 	 	 	

	Richard B. Boyer
	 	 	 	 
	 

	 	Name:
	 	Richard B. Boyer 
	/s/Wendy A. Boyer
	 	 	 	 
	

	 	Title:
	 	President 
	Wendy A. Boyer
	 	 	 	 

12

 

EXHIBIT A

Property Description

All that certain property situated in the Borough of Canonsburg, County of
Washington and Commonwealth of Pennsylvania, being designated as Tax Parcel No.
100-005-00-00-0010-00 in the Tax Assessment Office of Washington County.

Having erected thereon a commercial office building known as 121 W. Pike
Street.

13

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