Document:

snbr-ex108_527.htm

 

EX10.8

NON-STATUTORY STOCK OPTION AGREEMENT

	
THIS AGREEMENT is entered into and effective as of 
	
, 2019 (the “Date of Grant”), by and between Sleep Number Corporation (the “Company”) and  (the “Grantee”).

Unless defined in this Agreement, capitalized terms used in this Agreement shall have the meanings established in the Sleep Number Corporation Amended and Restated 2010 Omnibus Incentive Plan (the “Plan”).

The Company has adopted the Plan, which authorizes the grant of Non-Statutory Stock Options to Non-Employee Directors serving on the Board of Directors of the Company (the “Board”). The Company desires to give the Grantee, a Non-Employee Director, a proprietary interest in the Company and an added incentive to advance the interests of the Company by granting to the Grantee Non-Statutory Stock Options pursuant to the Plan.

Accordingly, the parties agree as follows:

1.Terms of Grant of Options.

1.1Type of Option.  The Company hereby grants to the Grantee Non-Statutory Stock Options in the quantity and at the price listed below, subject to the vesting provisions and other terms and conditions of this Agreement (the “Options”).

1.2Total Shares of Common Stock.  The grant of Options gives the Grantee the right to purchase up to __________ shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”).

	
1.3
	
Exercise Price of Option.  The exercise price of the Options is $_____ per share.

1.4Vesting Schedule.  All Options granted under this Agreement will become exercisable, or “vest,” on the earlier of (i) the first anniversary of the Date of Grant or (ii) the next annual meeting of shareholders of the Company at which directors are elected (the “Vesting Period”) subject to the Grantee remaining in continuous service on the Board during the Vesting Period; provided, however, that such restrictions (the “Restrictions”) will lapse and terminate prior to end of the Vesting Period as set forth in Section 2 below (or as otherwise set forth in the Plan for any circumstance not contemplated by the terms of Section 2). 

1.5Expiration of Options.  The Grantee’s right to exercise the Options will terminate as to all unexercised Options at 5:00 p.m., Central Time, on , 2029 (the “Expiration Date”), subject to earlier termination as described below or in the Plan.

1.6Fractional Shares.  The Grantee acknowledges that the Company will not issue or deliver fractional shares of Common Stock under this Agreement. All fractional shares will be rounded up to the nearest whole share.

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2.Death, Disability, or other Termination of Service.  The vesting and termination provisions of the Options granted hereby will be impacted by the termination of the Grantee’s service on the Board, depending on the reason for termination of the Grantee’s service on the Board, as set forth below.

	

	
2.1Death or Disability.  In the event that the Grantee’s service on the Board is terminated due to the Grantee’s death or Disability prior to the end of the Vesting Period, the Restrictions applicable to the Options will immediately lapse and terminate, and the Options will become immediately exercisable in full and will remain exercisable for up to three (3) years, but not beyond the Expiration Date.

	

	
2.2Termination Due to Retirement or Resignation.  In the event that the Grantee’s service on the Board is terminated by reason of the Grantee’s retirement or resignation from the Board prior to the end of the Vesting Period and the Grantee has five (5) or more years of service on the Board prior to such retirement or resignation, then the Grantee will receive a pro rata portion of Options that vest, pursuant to this provision, based on the number of calendar days elapsed in the Vesting Period divided by the total number of calendar days in the Vesting Period (e.g., if retirement or resignation occurs 243 calendar days into a 365-day Vesting Period, then 243/365ths of the Options will be vested). The remaining unvested Options will immediately terminate and be forfeited without notice of any kind. Upon any voluntary retirement or resignation from the Board, regardless of the number of years of service, Options that are vested will remain exercisable for up to three (3) years after retirement, but not beyond the Expiration Date.

2.3Termination by the Company other than for Cause or Adverse Action.  If the Grantee’s service on the Board is terminated by the Company other than for Cause or Adverse Action, Options that have already vested pursuant to Section 1.4 as of the date of the Grantee’s termination of service on the Board will remain exercisable for up to three (3) months, but not beyond the Expiration Date, after the Grantee’s service on the Board ends. The Options that have not vested as of the date of the Grantee’s termination of service on the Board will immediately terminate and be forfeited without notice of any kind.

2.4Termination by the Company for Cause or Adverse Action.  If the Grantee’s service on the Board is terminated by the Company for Cause or Adverse Action, all of the Grantee’s rights under the Plan, this Agreement, and the Options granted hereby will immediately terminate and be forfeited without notice of any kind.

3.Notice.  The Company is not required to give the Grantee notice of the termination of the Grantee’s Options.

4.Exercise.

4.1Manner of Exercise.  An Option may be exercised by the Grantee in whole or in part from time to time, subject to the conditions contained in this Agreement and the Plan. The Options may be exercised by delivery in person, by facsimile or electronic transmission, or through the mail of written notice of exercise to the Company at its principal executive office in Minneapolis, Minnesota (or to the Company’s designee, as 

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may be established from time to time by the Company and communicated to the Grantee), and by paying in full the total exercise price for the shares of Common Stock underlying the Options. 

4.2Payment of Exercise Price.  The total purchase price of the shares of Common Stock to be purchased upon exercise of an Option will be paid in cash, including check, bank draft, or money order, unless otherwise determined by the Committee or as otherwise provided for in the Plan.

5.Rights of the Grantee.

5.1Limitations on Transfer.  Except pursuant to testamentary will or the laws of descent and distribution, or as otherwise permitted by the Plan, prior to the exercise or vesting of Options, Options issued under the Plan will not be assignable or transferable by the Grantee or subjected to any lien, during the lifetime of the Grantee, either voluntarily or involuntarily, directly or indirectly, by operation of law or otherwise. The Grantee may, however, designate a beneficiary, as provided for in the Plan. 

5.2Rights as a Shareholder.  The Grantee will have no rights as a shareholder until the Grantee becomes the holder of record of shares of Common Stock issued upon the Grantee’s exercise of the Options. As soon as reasonably possible after the satisfaction of any conditions to the effective issuance of shares of Common Stock in settlement of the Options, the shares will be issued by the Company.

5.3Shares Purchased.  Following the Grantee’s exercise of the Grantee’s rights to purchase shares of Common Stock under this Agreement, the shares of Common Stock purchased by the Grantee will be freely tradable, subject to the Company’s policies and the Securities and Exchange Commission (“SEC”) rules regarding insider trading. Members of the Board are required to comply with SEC Rule 144 and with the Company’s policies with respect to insider trading in connection with any sale of shares received upon the exercise of any stock options.

5.4Service.  Nothing in this Agreement will interfere with or limit in any way the right of the Company to terminate the service of the Grantee at any time, nor confer upon the Grantee any right to continue in his or her service on the Board in any particular position or rate of pay or for any particular period of time.

6.Taxes.

6.1Withholding Taxes.  The Company is entitled to (i) withhold and deduct from future wages of the Grantee (or from other amounts that may be due and owing to the Grantee from the Company), or make other arrangements for the collection of all amounts the Company determines are legally required to satisfy any federal, state, or local withholding tax requirements attributable to the exercise of the Options, or (ii) require the Grantee promptly to remit the amount of such withholding to the Company. In the event that the Company is unable to withhold such amounts, for whatever reason, the Grantee agrees to 

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pay to the Company an amount equal to the amount the Company would otherwise be required to withhold under federal, state, or local law.

6.2Income Tax Implications.  There may be income tax consequences resulting from the exercise of the Options and/or sale of the shares of Common Stock received upon the exercise of the Options. The Grantee is urged to consult with his or her individual tax advisor regarding any tax consequences relating to these transactions. The Company accepts no responsibility for the income tax implications of the transactions resulting from this Agreement, except as set forth in Section 6.1.

7.Adjustments.  In the event of any reorganization, merger, consolidation, recapitalization, liquidation, reclassification, stock dividend, stock split, combination of shares, rights offering, or divestiture (including a spin-off), or any other change in the corporate structure or shares of the Company, the Committee (or, if the Company is not the surviving corporation in any such transaction, the board of directors of the surviving corporation), in order to prevent dilution or enlargement of the rights of the Grantee, will make appropriate adjustment (which determination will be conclusive) as to the number and kind of securities or other property (including cash) subject to this Agreement.

8.Subject to Plan.  The Options granted pursuant to this Agreement have been granted under the Plan and, except as otherwise expressly provided in this Agreement, are subject to all of the terms and conditions of the Plan. In addition, the Grantee, by execution hereof, acknowledges having received a copy of the Plan, a copy of the Company’s most recent annual report, and a copy of the Company’s most recent proxy statement. The provisions of this Agreement will be interpreted as to be consistent with the Plan and any ambiguities in this Agreement will be interpreted by reference to the Plan. In the event that any provision of this Agreement is not authorized under the Plan, the terms of the Plan will prevail.

9.Nature of Grant.  By accepting the Options, the Grantee acknowledges, understands, and agrees that:

9.1The grant of Options under this Agreement is made voluntarily by the Company under the Plan, which is established by and subject to the discretion of the Committee, and the Grantee’s participation in the Plan is voluntary. 

9.2The Options granted by this Agreement are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension, or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company. 

9.3The future value of the Options or Common Stock underlying the Options is uncertain and cannot be predicted. If the underlying shares of Common Stock do not increase in value, the Option will have no value.

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9.4Other than provided in the Plan or in this Agreement, the Options granted to the Grantee do not create any claim or entitlement to compensation or damages arising from forfeiture of the Options. 

10.Miscellaneous.

	
10.1
	
Binding Effect.  This Agreement will be binding upon the heirs, executors, administrators, and successors of the parties to this Agreement.

	
10.2
	
Governing Law.  This Agreement and all rights and obligations under this Agreement will be construed in accordance with the Plan and governed by the laws of the State of Minnesota, without regard to conflicts of laws provisions. Any legal proceeding related to this Agreement will be brought in an appropriate Minnesota court, and the parties to this Agreement consent to the exclusive jurisdiction of the court for this purpose.

	
10.3
	
Entire Agreement.  This Agreement and the Plan set forth the entire agreement and understanding of the parties to this Agreement with respect to the grant and vesting of the Options and the administration of the Plan and supersede all prior agreements, arrangements, plans, and understandings relating to the grant and vesting of the Options and the administration of the Plan.

	
10.4
	
Amendment and Waiver.  Other than as provided in the Plan, this Agreement may be amended, waived, modified, or canceled only by a written instrument executed by the parties to this Agreement or, in the case of a waiver, by the party waiving compliance.

10.5Code Section 409A.  Payments of amounts under this Agreement are intended to be exempt from the requirements of Code section 409A, and this Agreement shall in all respects be administered and construed to give effect to such intent.

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The parties hereto have executed this Agreement effective the day and year first above written.

SLEEP NUMBER CORPORATION

Shelly Ibach
President and CEO

 

 

By execution of this Agreement, theGRANTEE
Grantee acknowledges having received
a copy of the Plan, the Company’s annual
report, and the Company’s proxy statement.(Signature)

(Name and Address)

____________________________________

 

 

 

 

 

 

6separationagreementandge

             SEPARATION AGREEMENT AND GENERAL RELEASE                                                 This Separation Agreement and General Release (“Agreement”) is entered into by and  between Pacific Mercantile Bank, a California banking corporation (the “Employer”), on the one  hand, and Thomas J. Inserra (the “Employee”), on the other hand, with reference to the following  facts:                                    RECITALS         WHEREAS, the Employer and the Employee are parties to that certain Amended and  Restated Employment Agreement dated January 3, 2019 (the “Employment Agreement”); and         WHEREAS, the Employee’s employment with the Employer will terminate effective as of  October 23, 2019 (the “Separation Date”), and such termination shall constitute a “separation from  service” within the meaning of Section 409A of the Internal Revenue Code of 1986 as amended.         NOW, THEREFORE, in consideration of the promises and mutual covenants contained  herein and for other good and valuable consideration, the receipt and sufficiency of which are  hereby mutually acknowledged, the parties hereby agree as follows:                                   AGREEMENT         1.    Termination of Employment and Other Positions.  The Separation Date shall be the  Employee’s last date of employment in all positions Employee holds with the Employer and each  of the Employer’s affiliates.           2.    Consideration.  In consideration of the promises and releases made herein, if the  Employee timely signs, returns and does not revoke this Agreement, and any period of revocation  expires, all occurring within thirty (30) days after the Separation Date, the parties agree that the  Employer shall pay the Employee Three Hundred Thirty-Nine Thousand Nine Hundred Dollars  ($339,900), which is equal to twelve (12) months of Employee’s current Base Salary (as such term  is defined in the Employment Agreement), less applicable deductions under federal, state and local  laws (“Severance”), payable in a single lump sum on the 30th day following the Separation Date.          3.    General Release.  In consideration of the Severance and other promises made  herein, the Employee, on behalf of himself, his heirs, successors, executors, attorneys,  administrators, agents and assigns (collectively, the “Releasing Parties”) voluntarily and of the  Employee’s own free will, hereby releases, forever discharges and holds harmless, the Employer,  Pacific Mercantile Bancorp, a California corporation and the sole shareholder of the Employer  (“PMB”), and each of their respective current and former subsidiaries, affiliates and parent  companies, and each of their respective current and former officers, members, directors, trustees,  insurers, employees, agents, consultants, benefit plans, fiduciaries, administrators, owners, boards,  trustees, shareholders, partners, parents, subsidiaries, affiliates, related entities, representatives,  and attorneys, and each of their predecessors, successors and assigns (collectively, the “Released  Parties”) from any and all claims, rights, causes of action, demands, liabilities, debts, actions,  charges, complaints, obligations, costs, expenses, attorneys’ fees, damages, injuries, losses,  agreements, interest, promises, judgments, accounts, and other legal responsibilities arising in law,   SMRH:4822-0298-8458.2                -1-                                                                                                                         

 

equity or otherwise, of any and every kind, nature and character whatsoever, whether known or  unknown, unforeseen, unanticipated, unsuspected or latent, which any of the Releasing Parties  now own or hold, or have at any time heretofore owned or held, or may at any time own or hold  by reason of any matter arising from any act, event or omission which has occurred up through the  date the Employee executes this Agreement.  Without limiting the generality of the foregoing, this  general release includes, but is not limited to, claims for personal injury; claims for breach of any  implied or express contract or covenant; claims for promissory estoppel; claims for failure to pay  wages, benefits, vacation pay, severance pay, attorneys’ fees, or any compensation of any sort;  claims for failure to grant equity or allow equity to vest; claims for wrongful termination, public  policy violations, defamation, interference with contract or prospective economic advantage,  invasion of privacy, fraud, misrepresentation, emotional distress, breach of fiduciary duty, breach  of the duty of loyalty or other common law or tort causes of action; claims of harassment,  retaliation or discrimination based upon race, color, sex, national origin, ancestry, age, disability,  handicap, medical condition, religion, marital status, or any other protected class or status under  federal, state, or local law; claims arising under or relating to employment or employment  contracts; claims for unlawful effort to prevent employment, or unfair or unlawful business  practices, including without limitation all claims arising under Section 806 of the employee  protection provisions of the Sarbanes-Oxley Act of 2002; and claims arising under or relating to  the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title VII of the Civil  Rights Act of 1964, the Civil Rights Act of 1991, the Civil Rights Acts of 1866 and/or 1871, the  Americans With Disabilities Act of 1990, the Age Discrimination in Employment Act the Older  Workers Benefits Protection Act, the Family Medical Leave Act, the California Business and  Professions Code, the California Labor Code, including without limitation section 1102.5 of the  Labor Code, the California Fair Employment and Housing Act, the Occupational Safety and Health  Act or any other health/safety laws, statutes or regulations, the Employee Retirement Income  Security Act of 1974, the Internal Revenue Code, the California Family Rights Act, including any  amendments to or regulations promulgated under these statutes and including the similar laws of  any other states, any state human rights act, or any other applicable federal, state or local  employment statute, law or ordinance.         Notwithstanding the foregoing, none of the waivers and releases anywhere in this  Agreement shall waive, release, or limit in any way: (a) the Employee’s rights and claims not  subject to waiver by private agreement; (b) the Employee’s claim for unemployment insurance;  (c) the Employee’s rights and claims that cannot be waived as a matter of law; (d) any right of the  Employee to indemnification for service to the Employer in an officer or director capacity,  including his rights under any Directors and Officers Insurance policy obtained by the Employer;  or (e) the parties’ rights to enforce this Agreement.         To the maximum extent permitted by law, the Employee agrees not to initiate, file, cause  to be filed, or otherwise pursue any claims, either as an individual on his own behalf or as a  representative, member or shareholder in a class, collective or derivative action. The Employee  acknowledges that this Agreement does not prohibit the Employee from challenging the validity  of the waiver of his claims under the ADEA as contained in Section 4 of this Agreement (but no  other portion of such waiver) or from filing a charge with or participating in an investigation by a  governmental administrative agency or reporting alleged violations of law to an appropriate  government agency; provided, however, that, except with respect to the Securities and Exchange  Commission, the Employee hereby waives any right to receive any monetary award resulting from   SMRH:4822-0298-8458.2                -2-                                                                                                                         

 

 such a charge or investigation and provided further that the Employee agrees not to encourage any   person, including any current or former employee of the Employer or PMB, to file any kind of   claim whatsoever against any of the Released Parties.          4.    ADEA Waiver. The Employee acknowledges and agrees that the Employee is   hereby waiving and releasing any age claims or rights the Employee may have under the Age   Discrimination in Employment Act of 1967 (“ADEA”), as amended by the Older Workers’ Benefit   Protection Act of 1990, 29 U.S.C. §§ 621 et seq.  This Section and this Agreement are written in   a manner calculated to be understood by the Employee.  In connection with this ADEA release,   the Employee agrees that the Employee is hereby entering into this waiver and release knowingly   and voluntarily, and that this waiver and release does not apply to any rights or claims that may   arise under the ADEA after the date the Employee executes this Agreement.  The Employee further   acknowledges that the consideration given for the release of the ADEA claims is in addition to   anything of value to which the Employee was already entitled.  Finally, the Employee   acknowledges that the Employee has been advised by this writing that:                (a)   the Employee should consult with an attorney prior to executing this   Agreement;                (b)   the Employee has had at least twenty-one (21) days from receipt of this   Agreement to consider whether to execute it and release any age claim under the ADEA.  If the   Employee chooses to execute this Agreement before the 21-day period has elapsed, the Employee   does so knowingly and voluntarily;                (c)   the Employee has seven (7) days following the Employee’s execution of   this Agreement to revoke the Employee’s signature by providing written notice of this fact within   the 7-day period to Employer; such written notice to be delivered by overnight courier to Employer   at the following address:                      Pacific Mercantile Bancorp                      949 South Coast Drive, Suite 300                     Costa Mesa, CA 92626                     Attention: Chief Financial Officer                (d)   if the Employee revokes this Agreement, the Employee will not receive the   Severance or other benefits set forth in this Agreement.          5.    Waiver of Civil Code Section 1542.  The Employee understands that the foregoing   releases shall be effective as a full and final accord and satisfaction and general release of all   claims, whether known or unknown, against the Employer and the other Released Parties.  The  Employee acknowledges that the Employee has been advised of and fully waives, Section 1542 of  the Civil Code of the State of California which provides as follows:          “A general release does not extend to claims that the creditor or releasing party does not   know or suspect to exist in his or her favor at the time of executing the release and that, if known   by him or her, would have materially affected his or her settlement with the debtor or released   party.”     SMRH:4822-0298-8458.2                -3-                                                                                                                           

 

       The Employee is aware that the Employee may hereafter discover claims or facts in   addition to or different from those the Employee now knows or believes to exist with respect to  the subject matter of this Agreement which if the Employee had known, may have affected the  Employee’s decision to sign this Agreement; however, the Employee hereby settles and releases   all of the claims which the Employee has or may have against the Employer and the other Released   Parties including arising out of such additional or different facts.          6.    No Transferred Claims. The Employee represents and warrants to the Employer   that he has not heretofore assigned or transferred to any person not a party to this Agreement any   released matter or any part or portion thereof.          7.    Final Pay and Benefits.  In accordance with California law, the Employee has   received or will receive his final paycheck, any accrued but unused paid time off and any   unreimbursed business expenses and allowances, through the Separation Date.  All company-  provided benefits and privileges shall terminate on the Separation Date and/or in accordance with   the applicable benefit plan or program.  In addition, the Employee will receive notice regarding   the continuation of health insurance benefits pursuant to COBRA under separate cover, if   applicable.  The Employee acknowledges that all of the Employer’s obligations to the Employee   as a result of the Employee’s employment with the Employer, including under the Employment   Agreement and any change of control plan or agreement, have been fully satisfied, and that no   additional wages, bonuses, equity, stock options, incentives, commissions, severance, change of   control payments, paid time off, benefits, or compensation of any nature is due to the Employee   except as set forth in Section 2 of this Agreement if the Employee timely signs, returns and does   not revoke this Agreement.          8.    Return of Property.  On or before the Separation Date, the Employee agrees to   return to the Employer all property of the Employer including, all business materials, customer   files, documents, electronically-stored information, keys, credit cards, identification badges,   equipment including automobiles, software, computers and computer devices (laptops, PDAs,   phones, etc.) which the Employee used, accessed or possessed during the Employee’s   employment.          9.    Work Injuries/Leaves.  The Employee affirms that he has no known workplace   injuries or occupational diseases not previously disclosed to the Employer which would be   compensable under the California Workers’ Compensation system, and that the Employee has   been provided and/or has not been denied or retaliated against for requesting any leave under the   Family and Medical Leave Act or the California Family Rights Act.            10.   No Admission.  The parties agree that this Agreement is not to be construed or used   as, and is not evidence of an admission by the Employer or any of the Released Parties of any   violation of any federal, state or local statute, ordinance or regulation or any duty allegedly owed   by the Employer or any of the other Released Parties to the Employee.          11.   Continuing Obligations.  The parties understand and agree that nothing in this   Agreement shall affect, mitigate, release or supersede the Employee’s continuing confidentiality   and business protection covenants under the Employment Agreement.  Notwithstanding anything   to the contrary in the Employment Agreement or this Agreement, nothing in Section 6 of the     SMRH:4822-0298-8458.2                -4-                                                                                                                           

 

 Employment Agreement or this Agreement is intended to prohibit or prohibits the Employee from   reporting alleged violations of law to an appropriate government agency. In addition, the Employee   is hereby notified that 18 U.S.C. § 1833(b) states as follows:          “An individual shall not be held criminally or civilly liable under any Federal or State trade   secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal,   State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely   for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a   complaint or other document filed in a lawsuit or other proceeding, if such filing is made under   seal.”          Accordingly, notwithstanding anything to the contrary in the Employment Agreement or   this Agreement, the Employee understands that he has the right to disclose in confidence trade   secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of   reporting or investigating a suspected violation of law  The Employee understands that he also has   the right to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if   the filing is made under seal and protected from public disclosure. The Employee understands and   acknowledges that nothing in the Employment Agreement or this Agreement is intended to conflict   with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly   allowed by 18 U.S.C. § 1833(b).          12.   Non-Disparagement.  The Employee agrees that he will not make or publish any   statement (orally or in writing) that becomes or reasonably could be expected to become publicly   known, or instigate, assist or participate in the making or publication of any such statement, which   would libel, slander or disparage (whether or not such disparagement legally constitutes libel or   slander) the Employer, PMB or any other entity or person within the Employer or PMB, any of  their respective affairs or operations, or the reputations of any of their respective past or present  officers, directors, agents, representatives or employees. This Section 12 shall not be violated by  making any truthful statement to the extent required by law or by any court, arbitrator, or  administrative or governmental body or to the extent appropriate in connection with any dispute  over this Agreement or otherwise involving the Employee and the Employer.          13.   Indemnification.  Any actions by the Employee in derogation of the covenants in   this Agreement which cause the Employer or PMB to incur fees, costs and/or damages shall, in   addition to giving the Employer and PMB a right of action against the Employee, trigger the   Employee’s obligation to fully defend and indemnify the Employer and PMB against any and all   claims arising from the Employee’s breach of the covenants herein.          14.   Opportunity to Consult Counsel.  The Employee has been given the opportunity to   review this Agreement with an attorney and tax advisor of the Employee’s choice.  Each party   shall bear such party’s own attorneys’ fees and costs in connection with the review of this   Agreement.            15.   Miscellaneous. The following provisions shall apply for purposes of this   Agreement:     SMRH:4822-0298-8458.2                -5-                                                                                                                           

 

            (a)   Number and Gender. Where the context requires, the singular shall include  the plural, the plural shall include the singular, and any gender shall include all other genders.               (b)   Headings. The headings in this Agreement are inserted only as a matter of  convenience, and in no way define, limit, or extend or interpret the scope of this Agreement or of  any particular provision hereof.                (c)   Authority. Each of the parties hereto hereby represents that each has taken  all actions necessary in order to execute and deliver this Agreement.                (d)   Governing Law. This Agreement shall be construed, interpreted and  enforced in accordance with the laws of the State of California, without giving effect to the choice  of law principles thereof.                (e)   Severability. If any provision of this Agreement or the application thereof  is held invalid, the invalidity shall not affect other provisions or applications of this Agreement  which can be given effect without the invalid provisions or applications and to this end the  provisions of this Agreement are declared to be severable.               (f)   Modifications. This Agreement may not be amended, modified or changed  (in whole or in part), except by a formal, definitive written agreement expressly referring to this  Agreement, which agreement is executed by both of the parties hereto.               (g)   Waiver. No waiver of any breach of any term or provision of this Agreement  shall be construed to be, nor shall be, a waiver of any other breach of this Agreement. No waiver  shall be binding unless in writing and signed by the party waiving the breach.               (h)   Arbitration. Any controversy arising out of or relating to this Agreement  shall be submitted to arbitration in accordance with the arbitration provisions of the Employee’s  employment agreement entered with Employer.                (i)   Counterparts. This Agreement may be executed in one or more  counterparts, each of which shall be deemed to be an original but all of which together will  constitute one and the same instrument. Photographic copies of such signed counterparts may be  used in lieu of the originals for any purpose.                                   [Remainder of page intentionally left blank]    SMRH:4822-0298-8458.2                -6-                                                                                                                         

 

   The undersigned have read and understand the consequences of this Agreement and voluntarily  sign it. The undersigned declare under penalty of perjury under the laws of the State of California  that the foregoing is true and correct.     EXECUTED this 23rd day of October, 2019, at Orange County, California.                                                          “EMPLOYEE”                                                          /s/ Thomas J. Inserra                                               Thomas J. Inserra      EXECUTED this 23rd day of October, 2019, at Orange County, California.                                                          PACIFIC MERCANTILE BANK                                              By:   /s/ Brad Dinsmore                                                   Name:  Brad Dinsmore                                                      Title:   CEO/President                                                              SMRH:4822-0298-8458.2                -7-

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