Document:

ex10-3.htm

Exhibit 10.3

EXECUTIVE AGREEMENT

THIS AGREEMENT is made as of this 27th day of January, 2010, among NATIONAL PENN BANCSHARES, INC., a Pennsylvania business corporation having its principal place of business in Boyertown, Pennsylvania ("NPB"), NATIONAL PENN BANK, a national banking association having its principal place of business
in Boyertown, Pennsylvania ("Bank"), and KEENE S. TURNER, an individual residing at 1021 Gibraltar Road, Birdsboro, Pennsylvania 19508 ("Executive").

W I T N E S S E T H :

WHEREAS, Executive is employed by NPB and Bank as an Executive Vice President of Bank; and

WHEREAS, the Boards of Directors of NPB and Bank deem it advisable to provide Executive with certain additional benefits in the event of certain changes in control of NPB or Bank so that Executive will continue to attend to the business of NPB and Bank without distraction in the face of the
potentially disturbing circumstances arising therefrom.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants and promises set forth herein, and each intending to be legally bound, NPB, Bank and Executive agree as follows:

1.           Definitions.  The following terms have the meanings specified below:

	
  
	
a.
	
"Affiliate" means any corporation which is included within a "controlled group of corporations" including NPB, as determined under Code Section 1563.

	
  
	
b.
	
"Base Salary" means the Executive's annual base salary, established either by contract or by the Employer, prior to any reduction of such salary pursuant to any contribution to a tax-qualified plan under Section 401(k) of the Code.

	
  
	
c.
	
"Cause" means the occurrence of either of the following, the result of which is the termination of Executive’s Employment:

	
  
	
i.
	
Executive's conviction of, or plea of guilty or nolo contendere to, a felony or a crime of falsehood or involving moral turpitude; or

	
  
	
ii.
	
the willful failure by Executive to substantially perform his duties to Employer, other than a failure resulting from Executive's incapacity as a result of the Executive's disability, which willful failure results in demonstrable material injury and damage to Employer.

 

 

 

 

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Notwithstanding the foregoing, Executive's Employment shall not be deemed to have been terminated for Cause if such termination took place as a result of:

	
  
	
x.
	
questionable judgment on the part of Executive;

	
  
	
y.
	
any act or omission believed by Executive in good faith, to have been in or not opposed to the best interests of the Employer; or

	
  
	
z.
	
any act or omission in respect of which a determination could properly be made that Executive met the applicable standard of conduct prescribed for indemnification or reimbursement or payment of expenses under the By-laws of NPB or the laws of the Commonwealth of Pennsylvania, or the directors and officers' liability insurance of NPB or any Employer, in each case as in effect at the time of such act or omission.

d.           "Change in Control" means:

	
  
	
i.
	
An acquisition by any "person" or "group" (as those terms are defined or used in Section 13(d) of the Exchange Act) of "beneficial ownership" (within the meaning of Rule 13d-3 under the Exchange Act) of securities of NPB representing 24.99% or more of the combined voting power of NPB's securities then outstanding;

	
  
	
ii.
	
A merger, consolidation or other reorganization of Bank, except where the resulting entity is controlled, directly or indirectly, by NPB;

	
  
	
iii.
	
A merger, consolidation or other reorganization of NPB, except where shareholders of NPB immediately prior to consummation of any such transaction continue to hold at least a majority of the voting power of the outstanding voting securities of the legal entity resulting from or existing after any transaction and a majority of the members of the Board of
Directors of the legal entity resulting from or existing after any such transaction are former members of NPB's Board of Directors;

	
  
	
iv.
	
A sale, exchange, transfer or other disposition of substantially all of the assets of the Employer to another entity, except to an entity controlled, directly or indirectly, by NPB;

  

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v.
	
A sale, exchange, transfer or other disposition of substantially all of the assets of NPB to another entity, or a corporate division involving NPB; or

	
  
	
vi.
	
A contested proxy solicitation of the shareholders of NPB that results in the contesting party obtaining the ability to cast 25% or more of the votes entitled to be cast in an election of directors of NPB.

	
  
	
e.
	
"Code" means the Internal Revenue Code of 1986, as amended, and as the same may be amended from time to time.

	
  
	
f.
	
"Employer" means Bank, NPB or any Affiliate which employs Executive at any particular time.

	
  
	
g.
	
"Employment" means Executive's employment by Bank, NPB or any Affiliate at any particular time.

h.           "Exchange Act" means the Securities Exchange Act of 1934, as amended.

	
2.
	
Resignation of Executive.  If a Change in Control shall occur and if within one hundred eighty (180) days after the effective date of a Change in Control (or thirty (30) days after the completion of the conversion of the computer systems if such conversion is later than one hundred eighty (180) days after the effective date of a Change in Control,
in either event, the “Transition Period”) there shall be:

	
  
	
a.
	
Any involuntary termination of Executive's employment (other than for Cause);

	
  
	
b.
	
Any reduction in Executive's title, responsibilities or authority, including such title, responsibilities or authority as such may be increased from time to time;

	
  
	
c.
	
Any reduction in Executive's Base Salary in effect immediately prior to a Change in Control, or any failure to provide Executive with benefits at least as favorable as those enjoyed by Executive under any of the pension, life insurance, medical, health and accident, disability or other employee plans of NPB or an Affiliate in which Executive participated immediately prior to a Change in Control, or the taking of any
action that would materially reduce any of such compensation or benefits in effect at the time of the Change in Control, unless such reduction relates to a reduction applicable to all employees generally;

	
  
	
d.
	
Any reassignment of Executive beyond a thirty (30) mile commute by automobile from Boyertown, Pennsylvania; or

  

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e.
	
Any requirement that Executive travel in performance of his duties on behalf of NPB or an Affiliate for a greater period of time during any year than was required of Executive during the year preceding the year in which the Change in Control occurred (each of the foregoing, a “Triggering Event”);

then, at the option of Executive, exercisable by Executive within one hundred eighty (180) days of the occurrence of any Triggering Event within the Transition Period, Executive may resign from Employment (or, if involuntarily terminated, give notice of intention to collect benefits hereunder) by delivering a notice in writing  to
NPB,  in which case Executive shall be entitled to a lump sum cash severance payment equal to 100% of Executive's Base Salary in effect immediately prior to a Change in Control, which Employer shall pay to Executive within fifteen (15) days of Executive's termination of employment.

Executive shall not be required to mitigate the amount of any payment provided for in the preceding paragraph by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in the preceding paragraph be reduced by any compensation earned by Executive as the result of employment by another employer or
by reason of Executive's receipt of or right to receive any retirement or other benefits after the date of termination of employment or otherwise, except as otherwise provided therein.

	
3.
	
Out-Placement Services.  If a Change in Control occurs and Executive exercises the option to resign from Employment (or is involuntarily terminated) as described in Section 2, Employer shall provide Executive with the services of a professional out-placement firm, if Executive so requests, for the period not to exceed one year from the date of
Executive’s resignation (or termination), at Employer’s sole cost and expense, up to a maximum amount of Seven Thousand Five Hundred Dollars ($7,500).

4.           No Implied Rights; Rights on Termination of Employment.

	
  
	
a.
	
No Right to Continued Employment.  Nothing in this Agreement shall confer upon Executive any right with respect to continuance of Employment by Employer, nor shall it interfere with or limit in any way the right of Employer to terminate Executive’s Employment at any time.

	
  
	
b.
	
Voluntary Termination of Employment.  If Executive terminates Executive’s Employment with Employer at any time prior to a Change in Control, this Agreement shall terminate at that time and Employer shall have no further liability hereunder.

	
  
	
c.
	
Termination--Cause.  If Employer terminates Executive's Employment at any time for Cause, this Agreement shall terminate at that time and Employer shall have no further liability hereunder.

  

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d.
	
Termination—Without Cause.  Employer may terminate Executive’s Employment at any time without Cause.  If Employer terminates Executive's employment at any time without Cause prior to a Change in Control, and if no event has been publicly announced that with the passing of time would constitute a Change in Control, this Agreement
shall terminate at that time and Employer shall have no further liability hereunder.  If Employer terminates Executive’s Employment at any time prior to a Change in Control but subsequent to the occurrence of an event that has been publicly announced that with the passing of time would constitute a Change in Control, the provisions of Sections 2 and 3 of this Agreement shall apply to same extent as if Executive’s Employment had been involuntarily terminated subsequent to a Change in Control.

	
5.
	
Arbitration.  Any dispute or controversy arising out of or relating to this Agreement and any controversy as to a termination for Cause shall be settled exclusively by arbitration, conducted before a panel of three arbitrators, in Reading, Pennsylvania, in accordance with the rules of the American Arbitration Association then in effect.  Judgment
may be entered on the arbitrators' award in any court having jurisdiction.

	
6.
	
Exclusive Benefit.  Executive shall have no right to commute, sell, assign, transfer or otherwise convey the right to receive any payments hereunder, which payment and the right thereto are expressly declared to be non-assignable and non-transferrable.  In the event of any attempted assignment or transfer, this Agreement shall terminate
at that time and Employer shall have no further liability hereunder.

	
7.
	
Notices.  Any notice required or permitted to be given under this Agreement shall be properly given if in writing and if mailed by registered or certified mail, postage prepaid with return receipt requested, to Executive's residence in the case of any notice to Executive, or to the attention of the President at the principal office of Bank, in
the case of any notice to the Employer.

	
8.
	
Entire Agreement.  This Agreement contains the entire agreement relating to the subject matter hereof and may not be modified, amended or changed orally but only by an agreement in writing, consented to in writing by NPB, and signed by the party against whom enforcement of any modification, amendment or change is sought.

9.           Benefits.

	
  
	
a.
	
This Agreement shall be binding upon and inure to the benefit of NPB and Bank and their respective successors and assigns.  Each of NPB and Bank shall require any successor (whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business and/or assets of NPB or Bank to expressly assume and agree to perform this Agreement in the same manner and to the
same extent that NPB or Bank would be required to perform it if no such succession had taken place.  Failure to obtain such assumption and agreement prior to the effectiveness of any such succession shall constitute a breach of this Agreement and the provisions of Sections 2 and 3 of this Agreement shall apply.  As used in this Agreement, "NPB" or "Bank" shall mean NPB or Bank as defined previously and any successor to the business and/or assets of NPB or Bank as aforesaid which assumes and
agrees to perform this Agreement by operation of law or otherwise.

 

 

 

 

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b.
	
This Agreement shall be binding upon and inure to the benefit of and be enforceable by Executive's personal or legal representatives, executors, administrators, heirs, distributees, devisees and legatees.

	
10.
	
Applicable Law.  This Agreement shall be governed by and construed in accordance with the domestic internal law (but not the law of conflicts of law) of the Commonwealth of Pennsylvania.

	
11.
	
Headings.  The headings of the sections and subsections hereof are for convenience only and shall not control or affect the meaning or construction or limit the scope or intent of any of the sections or subsections of this Agreement.

IN WITNESS WHEREOF, NPB and Bank have each duly caused this Agreement to be executed on its behalf by its duly authorized officers, and Executive has hereunto set his hand and seal, as of the day and year first above written.

	
NATIONAL PENN BANCSHARES, INC.
	
NATIONAL PENN BANK

	  	  
	  	  
	
By:  /s/ Glenn E. Moyer
	
By:  /s/ Scott V. Fainor

	
Name:  Glenn E. Moyer
	
Name:  Scott V. Fainor

	
Title:  President & CEO
	
Title:     President & CEO

	  	  
	  	  
	
Attest:  /s/ Michelle H. Debkowski
	
Attest: /s/ Michelle H. Debkowski

	
Name:  Michelle H. Debkowski
	
Name:  Michelle H. Debkowski

	
Title:   Corporate Secretary
	
Title:     Corporate Secretary

	  	  
	
Witness:
	  
	  	  
	  	  
	
/s/ H. Anderson Ellsworth
	
/s/ Keene S. Turner

	
     H. Anderson Ellsworth
	
    KEENE S. TURNER

 

 

6ex10-4.htm

    EXHIBIT
10.4

    

    NATIONAL
PENN BANCSHARES, INC.

    CONSULTING AND NONCOMPETITION
AGREEMENT

    

    This Consulting and Noncompetition
Agreement (this “Agreement”) is being entered into as of as of January 27, 2010,
by and between National Penn Bancshares, Inc., a Pennsylvania corporation
(“National Penn”), and Michael
R. Reinhard (the “Consultant”).

    

    RECITALS:

    WHEREAS, the Consultant
desires to provide the services described herein subject to the terms and
conditions set forth below:

    

    NOW THEREFORE, in
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto, intending to be legally bound, hereby
agree as follows:

    

    1.           Consultancy.  During
the period beginning on the date on which Consultant’s employment with National
Penn is terminated (the “Termination Date”) and for a period of twelve (12)
months thereafter (the “Consulting Period”), the Consultant shall undertake to
provide his personal advice and counsel to National Penn and its subsidiaries
and affiliates in connection with the business of National Penn and its
subsidiaries, including, but not limited to:

     

    (a)           providing
continued services in the same manner as when he was employed on a permanent
basis as necessary to ensure a proper transition of his former job function to
his replacement;

     

    (b)           consulting
with National Penn regarding the operations and customer relationships of
National Penn and its subsidiaries;

     

    (c)           providing
introductions to customers and providing personal services similar to those the
Consultant is currently providing National Penn; (collectively the “Consulting
Services”), subject to the terms and conditions which are set forth
herein.  The Consultant shall provide such Consulting Services as may
be requested from time to time by either the President and Chief Executive
Officer or Senior Executive Vice President and Chief Operating Officer of
National Penn.  During the Consulting Period, the Consultant shall be
available to devote up to 30 hours per week of his business time, attention,
skills and efforts (other than during holidays, vacations and periods of
illness) to the business and affairs of National Penn and its subsidiaries and
affiliates and shall use his reasonable best efforts to promote the interests of
National Penn and its subsidiaries and affiliates.  Such Consulting
Services may be provided in person, telephonically, electronically or by
correspondence as reasonably determined by National Penn.  The
Consultant shall be available for meetings at the principal executive offices of
National Penn at such times as National Penn shall reasonably
require.

     

    
      
        
           

        

         

      

      
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    (d)           During
the Consulting Period, the Consultant shall be treated as an independent
contractor and shall not be deemed to be an employee of National Penn or any
subsidiary or affiliate of National Penn.

     

    (e)           The
obligations of National Penn under this Agreement are subject to and contingent
upon the Consultant continuing to be employed by National Penn from the date
hereof until the Termination Date.

     

    2.           Non-Disclosure of Confidential
Information. Except in the course of performing the Consulting Services
hereunder, and in the pursuit of the business of National Penn or any of its
affiliates, the Consultant shall not, except as required by law, at any time
during or following the Consulting Period, disclose or use any confidential
information or proprietary data of National Penn or any of its affiliates or
predecessors, unless such confidential information or proprietary data become
publicly known through no fault of the Consultant.  Without limiting
the generality of the foregoing, the Consultant agrees that all information
concerning the identity of the customers of National Penn and its affiliates and
the relations of such entities with their customers is confidential
information.  This Section 2 shall survive the termination or
expiration of the Consulting Period.

     

    3.           Non-Competition
Provisions.  The Consultant agrees that during the Consulting
Period, the Consultant will not (i) without the prior written consent of
National Penn (which consent may be given at National Penn’s discretion, but not
unreasonably withheld), directly or indirectly, engage in, become interested in,
or become associated with, in the capacity of employee, consultant, director,
officer, owner, principal, agent, trustee or in any other capacity whatsoever,
any proprietorship, partnership, corporation, enterprise or entity located
within a fifty (50) mile radius from Boyertown, PA, which proprietorship,
partnership, corporation, enterprise or other entity is, or may be deemed to be
by National Penn, competitive with any business carried on by National Penn or
its affiliates including but not limited to entities which lend money and take
deposits (in each case, a “Competing Business”), provided, however, that this
provision shall not prohibit the Consultant from owning bonds, voting and
non-voting preferred stock or up to five percent (5%) of the outstanding common
stock of any Competing Business if such common stock is publicly traded, (ii)
solicit or induce, or cause others to solicit or induce, any employee of
National Penn or any of its affiliates to leave the employment of such entities,
or (iii) without the prior written consent of National Penn (which consent may
be given at National Penn’s discretion, but not unreasonably withheld) solicit
(whether by mail, telephone, personal meeting or any other means, excluding
general solicitations of the public that are not based in whole or in part on
any list of customers of National Penn or any of its affiliates) any customer of
National Penn or any of its affiliates to transact business with any other
entity, whether or not a Competing Business, or to reduce or refrain from doing
any business with National Penn or its subsidiaries, or interfere with or damage
(or attempt to interfere with or damage) any relationship between National Penn
or its affiliates and any such customers.

     

    4.           Compensation.  In
consideration of the obligations and commitments of the Consultant under this
Agreement, including Sections 1, 2 and 3 hereof, National Penn shall pay to the
Consultant twelve equal installment payments in amounts equal to $14,583.33 per
month on the last business day of each month during the Consulting
Period.

     

    
      
        
           

        

         

      

      
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    5.           Benefits.  If
Consultant was participating in medical and dental coverage under a
Company-sponsored plan immediately prior to the Termination Date, Consultant
will receive such medical and dental benefits during the Consulting Period,
commencing as of the Termination Date, subject to Consultant’s continued payment
of the applicable monthly premiums at active Company employee
rates.  Health benefits to which Consultant is entitled by law under
the Consolidated Omnibus Budget Reconciliation Act, as amended (“COBRA”) will
commence immediately upon the cessation of the Consulting Period.

     

    6.           Successors
and Assigns.

     

    (a)           During
the Consulting Period, National Penn will require any successor or assign
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of its business and/or assets, by agreement in form and
substance satisfactory to the Consultant, expressly, absolutely and
unconditionally to assume and agree to perform this Agreement in the same manner
and to the same extent that National Penn would be required to perform it if no
such succession or assignment had taken place.  Any failure of
National Penn to obtain such agreement prior to the effectiveness of any such
succession or assignment during this twelve-month period shall be a material
breach of this Agreement.

     

    (b)           This
Agreement and all rights of the Consultant shall inure to the benefit of and be
enforceable by the Consultant’s personal or legal representatives, estate,
executors, administrators, heirs and beneficiaries.  In the event of
the Consultant’s death, any amounts accrued and unpaid through the date of death
shall be paid to the Consultant’s estate, heirs and
representatives.  Except as provided 
in this Section 6, no party may assign this
Agreement or any rights, interests, or obligations hereunder without the prior
written approval of the other party.  Subject to the preceding
sentence, this Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted
assigns.

     

    7.           Enforcement.  This
Agreement shall be construed, enforced and interpreted in accordance with and
governed by the laws of the Commonwealth of Pennsylvania, without reference to
its principles of conflict of laws, except to the extent that federal law shall
be deemed to preempt such state laws.

     

    8.           Amendment.  This
Agreement may be amended or modified at any time by a written instrument
executed by the parties.

     

    9.           Waiver. Failure to insist upon
strict compliance with any of the terms, covenants or conditions hereof shall
not be deemed a waiver of such term, covenant or condition.  A waiver
of any provision of this Agreement must be made in writing, designated as a
waiver, and signed by the party against whom its enforcement is
sought.  Any waiver or relinquishment of any right or power hereunder
at any one or more times shall not be deemed a waiver or relinquishment of such
right or power at any other time or times.

     

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

     

    
      
        
           

        

         

      

      
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    11.           Headings and
Construction.  The headings of sections in this Agreement are
for convenience of reference only and are not intended to qualify the meaning of
any section.  Any reference to a section number shall refer to a
section of this Agreement, unless otherwise stated.

     

    12.           Entire Agreement. This
instrument contains the entire agreement of the parties relating to the subject
matter hereof, and supersedes in its entirety any and all prior agreements,
understandings or representations relating to the subject matter hereof, except
that the Executive Agreement shall remain in effect as amended by this
Agreement.

     

    IN WITNESS WHEREOF, National
Penn has caused this Agreement to be executed by its duly authorized officer,
and the Consultant has signed this Agreement, all as of the date first written
above.

    
      	 
      	 
      
	 
      	
              NATIONAL
      PENN BANCSHARES, INC.

            
	 
      	 
      
	 
      	
              /s/   Scott V.
      Fainor

            
	 
      	
              Name:   Scott
      V. Fainor

            
	 
      	
              Title:   President
      & CEO

            
	 
      	 
      
	 
      	 
      
	
              WITNESS:

            	 
      
	 
      	 
      
	
              /s/ H. Anderson
      Ellsworth

            	
              /s/  Michael R.
      Reinhard

            
	
                   H.
      Anderson Ellsworth

            	
              MICHAEL
      R. REINHARD

            

    

    
 

     

     

     - 4
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