Document:

Exhibit
4.1

 

[
Alliant Techsystems Inc. Logo ]

 

 

	
   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

  Dated

   

   

  Countersigned and
  registered

  Mellon Investor
  Services, LLC

  Transfer Agent and
  Registrar

   

   

   

  /s/ Maurice Lynch

  Authorized Officer

  	
   

  
	
  Number               Common
  Stock                Alliant Techsystems
  Inc.             Shares

  AT

   

  
	
   

  
	
   

  
	
  This is to certify that

  	
   

  	
   

  	
  Cusip 018804 10 4

  
	
   

  
	
   

  
	
  is the Owner of

  
	
   

  
	
  Fully paid and non-assessable
  shares of the common stock, $.01 par value, of Alliant Techsystems Inc.
  (hereinafter referred to as the Company), transferable on the books of the
  Company by the holder hereof in person or by duly authorized attorney on
  surrender of this certificate properly endorsed. This certificate and the
  shares represented hereby are issued and shall be held subject to all of the
  provisions of the Company's Restated Certificate of Incorporation, as
  amended, and of any resolutions of its Board of Directors providing for the issue
  of Preferred Stock, copies of which are on file with the Transfer Agent, to
  all of which each holder by acceptance hereof assents. This certificate is
  not valid until countersigned by the Transfer Agent and registered by the
  Registrar.

   

  In Witness Whereof, the Company
  has caused facsimiles of the signatures of its proper officers and a facsimile
  of its corporate seal to be hereunto affixed.

  	
  Incorporated under the laws of the State of Delaware

   

   

  See reverse side for certain definitions

   

  This certificate is transferable in New York,
  N.Y. and Ridgefield Park, N.J.

  
	
   

  	
   

  
	
  Certificate of Stock

  	
   

  
	
   

  	
  /s/ Keith D. Ross

  
	
  /s/ Paul David Miller  

  Chairman of the Board

  	
  Senior Vice
  President, General Counsel and Secretary

  
						

 

 

[ Alliant Techsystems Inc. Logo ]

 

Alliant Techsystems Inc. will furnish without
charge to each stockholder who so requests, a statement or summary of the
designations, preferences and relative, participating, optional or other
special rights of each class of stock or series thereof which the Company is
authorized to issue and of the qualifications, limitations or restrictions of
such preferences and/or rights. Any such request is to be addressed to the
transfer agent named on the face of this certificate.

 

This certificate also evidences and entitles
the holder hereof to certain Rights as set forth in the Rights Agreement
between Alliant Techsystems Inc. (the “Company”) and LaSalle Bank National
Association, as Rights Agent, dated as May 7, 2002 (the “Rights Agreement”),
the terms of which are hereby incorporated herein by reference and a copy of
which is on file at the principal offices of the Company. The Rights are not exercisable
prior to the occurrence of certain events specified in the Rights Agreement.
Under certain circumstances, as set forth in the Rights Agreement, such Rights
may be redeemed, may be exchanged, may expire, may be amended, or may be
evidenced by separate certificates and no longer be evidenced by this
certificate.  The Company will mail to
the holder of this certificate a copy of the Rights Agreement, as in effect on
the date of the mailing, without charge promptly after receipt of a written
request therefor. Under certain circumstances set forth in the Rights
Agreement, Rights that are or were beneficially owned by an Acquiring Person or
any Affiliate or Associate of an Acquiring Person (as such terms are defined in
the Rights Agreement), may become null and void.

 

	
  The following
  abbreviations, when

  used in the inscription on
  the

  face of this certificate,
  shall be

  construed as though they
  were

  written out in full
  according to

  applicable laws or
  regulations.

  Additional abbreviations
  may also

  be used though not in the
  list. 

  	
   

  	
  TEN COM

  	
   

  	
  UNIF GIFT MIN ACT

  
	
   

  	
  as tenants in common

  	
   

  	
  (Name) as Custodian for
  (Name)

  under the Uniform Gifts to
  Minors

  Act of (State)

  
	
   

  	
  TEN ENT

  	
   

  
	
   

  	
  as tenants by the
  entireties

  	
   

  
	
   

  	
  JT TEN

  	
   

  
	
   

  	
  as joint tenants with
  right of

  survivorship and not as
  tenants in

  common

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  
	
  Please print or type social
  security or other identifying number, name and address of assignee on the
  lines below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  For value received

  	
   

  	
  hereby sell, assign and

  transfer unto

  	
   

  	
  Social security or other
  identifying

  number of assignee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  City

  	
   

  	
  State

  	
   

  	
  Zip code

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shares of the capital stock
  represented by the within certificate, and do hereby irrevocably constitute
  and appoint

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Attorney to transfer the said
  stock on the books of the within-named Company with full power of
  substitution in the premises.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Signed

  	
   

  	
   

  	
   

  	
  Dated

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Notice: The signature to this
  assignment must correspond with the name as written upon the face of the
  certificate in every particular without alteration or any change whatever.Exhibit 10.17.1

 

On May 19, 2005, the
Registrant’s Board of Directors approved a modification to a retention bonus
pool for key management employees adopted on February 16, 2005. The
purpose of the retention bonus pool, whether the pool contains cash or options,
is to provide an additional incentive to key management personnel to give their
entire attention and efforts to the Company’s business. Participants who
voluntarily terminate their employment or are terminated for cause prior to the
date on which the change in control occurs shall not be eligible to receive any
payment on account of these options.

 

The pool was initially
funded with $135,000 in cash, all of which is being released to the Registrant
immediately. Stock options will be granted upon a change in control in the
Registrant.  Upon their grant on the date
of the change in control, the options would be immediately vested and have an
exercise price equal to the closing price of the Registrant’s common stock.
There are 600,000 shares of authorized and previously unissued common stock,
without par value, reserved and committed to these future grants.  The options shall be subject to the terms and
conditions of the Registrant’s 1996 Stock Option Plan.

 

The options to purchase
600,000 shares would be distributed as follows:

 

	
  Creighton K. Early

  	
   

  	
  240,000

  	
   

  
	
  Michael P. Zachan

  	
   

  	
  120,000

  	
   

  
	
  Stephen J. Vukadinovich

  	
   

  	
  120,000

  	
   

  
	
  Gregory S. Gower

  	
   

  	
  120,000Exhibit 10.1

 

EMPLOYMENT
AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(“Agreement”) is made and entered into as of the 23rd  day of May 2005, by and
among Frederick County Bank, a Maryland corporation (“Bank”), and Martin S.
Lapera (“Mr. Lapera”).

 

RECITAL

 

Bank desires to continue
to retain Mr. Lapera as the President and Chief Executive Officer.  Mr. Lapera desires to accept such
employment, all upon the terms and conditions hereinafter set forth.

 

NOW, THEREFORE, in
consideration of the recital, the mutual covenants and agreements herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement,
intending to be legally bound, agree as follows:

 

1.                                       Certain
Definitions. As used in this Agreement, the following terms have the
meanings set forth below:

 

1.1                                 “Commencement
Date” means April 1, 2005.

 

1.2                                 “Bank
Regulatory Agency” means any governmental authority, regulatory agency,
ministry, department, statutory corporation, central bank or other body of the
United States or of any other country or of any state or other political
subdivision of any of them having jurisdiction over Bank or any transaction
contemplated, undertaken or proposed to be undertaken by Bank, including, but
not necessarily limited to:

 

(a) the Federal Deposit Insurance Corporation or any other
federal or state depository insurance organization or fund;

 

(b) the Federal Reserve System, the Comptroller of the Currency,
the Maryland Division of Financial Institutions, or any other federal or state
bank regulatory or commissioner’s office;

 

(c) any Person established, organized, owned (in whole or in
part) or controlled by any of the foregoing; and

 

(d) any predecessor, successor or assignee of any of the
foregoing.

 

1.3                                 “Bank
Board” means the Board of Directors of Frederick County Bank.

 

1.4                                 “Bank
Bylaws” means the Bylaws of Frederick County Bank as in effect from time to
time.

 

1.5                                 “Chairman”
means the Chairman of the Board of Frederick County Bank.

 

1.6                                 “Code”
means the Internal Revenue Code of 1986, as amended.

 

1.7                                 “Company”
means Frederick County Bancorp, Inc.

 

1.8                                 “Person”
means any individual, firm, association, partnership, corporation, limited
liability company, group, governmental agency or other authority, or other
organization or entity.

 

2.                                       Employment;
Term.

 

2.1 Position. Bank
hereby employs Mr. Lapera to serve as its President and Chief Executive
Officer.  Mr. Lapera shall also be a
member of the Bank Board subject to election by the Company in accordance with
the Bank Bylaws.

 

2.2 Term. The term
of this Agreement and Mr. Lapera’s employment hereunder shall commence
with the Commencement Date and continue until October 1, 2009  (the “Term”), unless sooner terminated in
accordance with the provisions of this Agreement.

 

1

 

3.                                       Duties
of President.

 

3.1 Nature and
Substance.  Mr. Lapera shall
report directly to the Chairman and shall be under the direction of the
Chairman.  The specific powers and duties
of the President shall be established, determined and modified by and within
the discretion of the Bank Board including (but not necessarily limited to):

 

(a) the coordination
and leadership of the efforts of the Bank to achieve and maintain any and all
necessary and/or appropriate Bank Regulatory Agency approvals and permissions
prerequisite to its successful continued operation, including coordination of
the professional services of counsel, accountants and bank consultants;

 

(b) the preparation and presentation to the Bank Board of
budgets and adherence of the Bank to those approved by the Bank Board;

 

(c) the provision of such reports, updates and other data and
information as may be reasonably required by the Bank Board and Bank Regulatory
Agencies;

 

(d) subject to
guidelines and/or criteria established by the Bank Board, the hiring,
promotion, supervision, retention and discharge of all employees, except at or
above the level of Senior Vice President.

 

(e) the formulation and implementation of Bank employee
personnel policies and benefits, subject to approval by the Bank Board;

 

(f) the promotion of the reputation and business of the Bank
within the community;

 

(g) the advancement of the business purposes of the Bank,
including, but not limited to, business development and customer, depositor and
public relations;

 

(h) participation in and service upon such committees and
subcommittees as may be directed by the Bank Board without additional
compensation to that set forth herein below;

 

(i) supervision of
the maintenance of the books and accounts and the supervision and maintenance
of accounts payable and expenses of the Bank and the reporting of the status
thereof at each scheduled or called meeting of the Bank Board or any committee
thereof; provided, however, that all expenditures on behalf of the Bank shall
be approved in accordance with the terms and conditions of procedures
established by the Bank Board;

 

(j) such
other duties of the President and Chief Executive Officer of the Bank as may be
enumerated in the Bank Bylaws.

 

(k) such other duties and
responsibilities as are normally incident to the subject position of President,
including assisting, directing and/or supervising the operations and other
employees of the Bank upon such terms, conditions, rules, policies and
regulations as may be established by the Bank Board from time to time.

 

3.2 Performance of
Services.  Mr. Lapera agrees to
devote his full business time and attention to the performance of his duties
and responsibilities under this Agreement, and shall use his best efforts and
discharge his duties to the best of his ability for and on behalf of the Bank
and to its successful operation.   Mr. Lapera
shall comply with all laws, statutes, ordinances, rules and regulations
relating to his employment and duties. During the Term of this Agreement, Mr. Lapera
shall not at any time or place directly or indirectly engage or agree to engage
in any business or practice related to the banking business with or for any
other Person to any extent whatsoever, other than to the extent required by the
terms and conditions of this Agreement.  Mr. Lapera
agrees that while employed by the Bank he will not, without the prior written
consent of the Bank Board, engage, or obtain a financial or ownership interest,
in any other business, employment, consulting or similar arrangement, or other
undertaking (an “Outside Arrangement”) if such Outside Arrangement would
interfere with the satisfactory performance of his duties to the Bank, present
a conflict of interest with the Bank, breach his duty of loyalty or fiduciary
duties to the Bank, or otherwise conflict with the provisions of this
Agreement; provided, however, that Mr. Lapera shall not be prevented from
investing his

 

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assets in such form or
manner as would not require any services on the part of Mr. Lapera in the
operation or the affairs of the entities in which such investments are made and
provided such investments do not present a conflict of interest with the
Bank.  Mr. Lapera shall promptly
notify the Bank Board of any Outside Arrangement and provide the Bank Board
with any written agreement in connection therewith.

 

4.                                       Compensation
and Benefits. As full compensation for all services rendered pursuant to
this Agreement and the covenants contained herein, the Bank shall pay to Mr. Lapera
the following:

 

4.1 Salary.
Beginning on the Commencement Date, Mr. Lapera shall be paid a salary (“Salary”)
of One Hundred Ninety Thousand Dollars ($190,000) on an annualized basis. The
Bank shall pay Mr. Lapera’s Salary in equal installments in accordance
with the Bank’s regular payroll periods. 
Mr. Lapera’s Salary shall be further increased from time to time at
the discretion of the Bank Board.

 

4.2 Bonus.  During the Term, Mr. Lapera shall be
paid a bonus (“CEO Bonus”) as approved by the Compensation Committee and the
Bank Board.

 

4.3 Withholding.
Payments of Salary and CEO Bonus shall be subject to the customary withholding
of income and other employment taxes as is required with respect to
compensation paid by an employer to an employee.

 

4.4 Vacation and
Leave.  Mr. Lapera shall be
entitled to thirty (30) days vacation and leave annually, of which eleven (11)
days may be carried over to the following year. 
Sick leave may be provided for under the current and future sick leave
policies of the Bank for executive officers.

 

4.5 Automobile
Allowance.  Mr. Lapera shall be
provided an automobile allowance of $10,000 annually, which shall be paid in
quarterly payments of $2,500, payable on the last day of each quarter
commencing with the second quarter of 2005. 
This allowance is in lieu of any automobile expense reimbursement.

 

4.5 Non-Life
Insurance.  The Bank will provide Mr. Lapera
with group health, disability and other insurance as the Bank Board may
determine appropriate.

 

4.6 Life Insurance.

 

4.6.1 The Bank will
obtain, and maintain at all times while this Agreement is in effect, a term
life insurance policy (the “Policy”) on Mr. Lapera in the amount of
$800,000, the particular product and carrier to be chosen by the Bank in its
discretion.  Mr. Lapera shall have
the right to designate the beneficiary of the Policy.  The Bank will pay the premium for the Policy
at the standard rate. In the event Mr. Lapera is rated and the premium
exceeds the standard rate, Mr. Lapera shall be responsible for paying the
excess, which shall be deducted from his Salary.

 

4.6.2 The Bank may, at
its cost, obtain and maintain “key-man” life insurance on Mr. Lapera in
such amount as determined by the Bank Board from time to time.  Mr. Lapera agrees to cooperate fully and
to take all actions reasonably required by the Bank in connection with such
insurance.

 

4.7 Expenses.  The Bank shall promptly upon presentation of
proper expense reports therefor reimburse Mr. Lapera, in accordance with
the policies and procedures established from time to time by the Bank Board for
its senior executive officers, for all reasonable and customary travel and
other out-of-pocket expenses incurred by Mr. Lapera in the performance of
his duties and responsibilities under this Agreement and promoting the business
of the Bank, including appropriate membership fees, dues and the cost of
attending meetings and conventions.

 

4.8 Retirement Plans.  Mr. Lapera shall be entitled to
participate in any and all qualified pension or other retirement plans of the
Bank which may be applicable to executive personnel of the Bank.

 

4.9 Warrants.  Mr. Lapera shall be issued warrants or
options to acquire shares of Bank stock from time to time at the discretion of
the Bank Board.

 

3

 

4.10 Other Benefits.
While this Agreement is in effect, Mr. Lapera shall be entitled to all
other benefits that the Bank provides from time to time to its senior executive
officers, including, but not limited to, any stock option plan and other
incentive plans.

 

4.11 Eligibility.
Participation in any health, life, accident, disability, medical expense or
similar insurance plan or any qualified pension or other retirement plan shall
be subject to the terms and conditions contained in such plan. All matters of
eligibility for benefits under any insurance plans shall be determined in
accordance with the provisions of the applicable insurance policy issued by the
applicable insurance company.

 

5.                                       Conditions
Subsequent to Continued Operation and Effect of Agreement.

 

5.1 Continued Approval
by Bank Regulatory Agencies. This Agreement and all of its terms and
conditions, and the continued operation and effect of this Agreement, shall at
all times be subject to the continuing approval of any and all Bank Regulatory
Agencies whose approval is a necessary prerequisite to the continued operation
of the Bank.  Should any term or
condition of this Agreement, upon review by any Bank Regulatory Agency, be
found to violate or not be in compliance with any then-applicable statute or
any rule, regulation, order or understanding promulgated by any Bank Regulatory
Agency, or should any term or condition required to be included herein by any
such Bank Regulatory Agency be absent, this Agreement may be rescinded and
terminated by either party if the parties hereto cannot in good faith agree
upon such additions, deletions, or modifications as may be deemed necessary or
appropriate to bring this Agreement into compliance.

 

6.                                       Termination
of Agreement. This Agreement may be terminated prior to expiration of the
Term as provided below.

 

6.1                                 Definition
of Cause. For purposes of this Agreement, “Cause” means:

 

(a) any
act of theft, fraud, intentional misrepresentation or similar conduct by Mr. Lapera
in connection with or associated with the services rendered by Mr. Lapera
to the Bank under this Agreement;

 

(b) any failure of this Agreement to comply with any Bank
Regulatory Agency requirement which is not cured in accordance with Section 5.1
within a reasonable period of time after written notice thereof;

 

(c) any Bank Regulatory Agency action or proceeding against Mr. Lapera
as a result of his negligence, fraud, malfeasance or misconduct;

 

(d) material failure
of Mr. Lapera to achieve budget requirements, performance standards or
targets established annually by the Bank Board, where such failure is not the
result of economic conditions or lack of appropriate effort and/or due diligence
by Mr. Lapera; or

 

(e) any of the following conduct on the part of Mr. Lapera
that has not been corrected or cured within thirty (30) days after having
received written notice from the Bank Board detailing and describing such
conduct:

 

(i)                                     the
use of drugs, alcohol or other substances by Mr. Lapera to an extent which
materially interferes with or prevents Mr. Lapera from performing his
duties under this Agreement;

 

(ii)           failure
by or the inability of Mr. Lapera to devote full time, attention and
energy to the performance of his duties pursuant to this Agreement (other than
by reason of his death or disability);

 

(iii)          intentional material failure by Mr. Lapera to carry out
the explicit lawful and reasonable directions, instructions, policies, rules,
regulations or decisions of the Bank

 

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Board, which are
consistent with his position as President and Chief Executive Officer; or

 

(iv)          willful or intentional misconduct on the part of Mr. Lapera
that results in substantial injury to the Bank or any of its subsidiaries or
affiliates.

 

6.2  Termination by
Bank.

 

6.2.1  For Cause.  The Bank shall have the right to cancel and
terminate this Agreement and Mr. Lapera’s employment for Cause immediately
on written notice, with his compensation and benefits ceasing as of his last
day of employment, provided, however, that Mr. Lapera shall be entitled to
benefits through the last day of employment and accrued compensation to that
date.

 

6.2.2  Without Cause.  The Bank shall have the right to cancel and
terminate this Agreement and Mr. Lapera’s employment at any time on
written notice without Cause for any or no reason, with Mr. Lapera’s
compensation and benefits ceasing as of his last day of employment, subject to
the provisions of Section 6.4. and Article 8.

 

6.3
 Termination
by Mr. Lapera.  Mr. Lapera
shall have the right to cancel and terminate this Agreement and his employment
at any time on sixty (60) days prior written notice to the Bank Board, with his
compensation and benefits ceasing as of his last day of employment, provided,
however, that he shall be entitled to benefits through the last day of
employment and accrued compensation to that date.

 

6.4
 Severance.
Except as set forth below, if Mr. Lapera’s employment with the Bank is
terminated by the Bank or its successors during the Term without Cause, the
Bank or its successors shall, for the balance of the Term, continue to pay Mr. Lapera,
in the manner set forth below, Mr. Lapera’s Salary at the rate being paid
as of the date of termination plus the unpaid portion of any CEO Bonus previously approved as provided in Section 4.2; and
such other benefits as provided in Sections 4.4, 4.5, and 4.6; provided,
however, that Mr. Lapera shall not be entitled to any such payments of
Salary if (i) his employment is terminated due to his death or long-term
disability or (ii) this Agreement is rendered null and void pursuant to Section 5.1
or (iii) there is a Change in Control Termination (as defined in Section 8.2).
Any Salary and CEO Bonus due Mr. Lapera pursuant to this Section 6.4
shall be paid to Mr. Lapera in installments on the same schedule as
he was paid immediately prior to the date of termination, each installment to
be the same amount he would have been paid under this Agreement if he had not
been terminated. In the event Mr. Lapera breaches any provision of Article 7
of this Agreement, Mr. Lapera’s entitlement to any Salary, any CEO Bonus,
and any benefits due pursuant to this Section 6.4, if and to the extent
not yet paid, shall thereupon immediately cease and terminate.

 

7.                                       Confidentiality;
Non-Competition; Non-Interference.

 

7.1 Confidential
Information. Mr. Lapera, during employment by the Bank, will have
access to and become familiar with various confidential and proprietary
information of the Bank, its parent, subsidiaries and/or affiliates (“Confidential
Information”), including, but not limited to: business plans; operating
results; financial statements and financial information; contracts; mailing
lists; purchasing information; customer data (including lists, names and
requirements); feasibility studies; personnel related information (including
compensation, compensation plans, and staffing plans); internal working
documents and communications; and other materials related to the businesses or
activities of the Bank, its subsidiaries and/or affiliates which is made
available only to employees with a need to know or which is not generally made
available to the public. Failure to mark any Confidential Information as
confidential, proprietary or protected information shall not affect its status
as part of the Confidential Information subject to the terms of this Agreement.

 

7.2 Nondisclosure.  Mr. Lapera hereby covenants and agrees
that he shall not at any time, directly or indirectly, disclose, divulge,
reveal, report, publish, or transfer any Confidential Information to any
Person, or use Confidential Information in any way or for any purpose, except
as required in the course of his employment by the Bank. The covenant set forth
in this Section 7.2 shall not apply to information now known by the public
or

 

5

 

which
becomes known generally to the public (other than as a result of a breach of
this Article 7 by Mr. Lapera) or information that is customarily
shown or disclosed.

 

7.3
 Documents.
All files, papers, records, documents, compilations, summaries, lists, reports,
notes, databases, tapes, sketches, drawings, memoranda, and similar items
(collectively, “Documents”), whether prepared by Mr. Lapera, or otherwise
provided to or coming into the possession of Mr. Lapera, that contain any
proprietary information about or pertaining or relating to the Bank, its
parent, subsidiaries and/or affiliates and/or their businesses (“Proprietary
Information”) shall at all times remain their exclusive property. Promptly
after a request by the Bank Board or the termination of Mr. Lapera’s
employment, Mr. Lapera shall take reasonable efforts to (i) return to
the Bank all Documents in any tangible form (whether originals, copies or
reproductions) and all computer disks containing or embodying any Document or
Proprietary Information and (ii) purge and destroy all Documents and
Proprietary Information in any intangible form (including computerized, digital
or other electronic format) as may be requested in writing by the Chairman of
the Board of the Bank, and Mr. Lapera shall not retain in any tangible
form any such Document or any summary, compilation, synopsis or abstract of any
Document or Proprietary Information.

 

7.4           Non-Competition.

 

7.4.1 Mr. Lapera
hereby acknowledges and agrees that, during the course of employment by the
Bank, he will become familiar with and involved in all aspects of the business
and operations of the Bank and its parent, subsidiaries and affiliates.  Mr. Lapera hereby covenants and agrees
that from the Commencement Date until the earlier to occur of (a) the date
one hundred eighty (180) days after his last day of employment with the Bank or
(b) October 1, 2009, Mr. Lapera will not at any time, directly
or indirectly, in any capacity (whether as a proprietor, owner, agent, officer,
director, shareholder, partner, principal, member, employee, contractor,
consultant or otherwise) render any services to a bank or savings and loan or a
holding company of a bank or savings and loan (in any case, a “Bank”) with
respect to any Bank office, branch or other facility (in any case, a “Branch”)
that is located within a thirty-five (35) mile radius of the location of the
Bank’s headquarters on the date hereof (including, without limitation, being
involved in any manner in the operations of or having any responsibilities with
respect to any Branch).

 

7.4.2 This Section 7.4
shall not apply if prior to October 1, 2009, there is a (i) merger or
consolidation of the Bank with a third party in which the Bank is not the
survivor, (ii) sale of a controlling interest in the Bank to a third party
or (iii) a sale of all or substantially all of the business or assets of
the Bank to a third party, and this Agreement is not assigned to such third
party or Mr. Lapera’s employment hereunder is otherwise terminated by such
third party in connection with such merger, consolidation or sale. Further,
mere ownership of less than two percent (2%) of the securities of any publicly
held corporation shall not constitute a violation of this Section.

 

7.5 Non-Interference.  Mr. Lapera hereby covenants and agrees
that from the Commencement Date until the earlier to occur of (a) the date
one hundred eighty (180) days after his last day of employment with the Bank or
(b) October 1, 2009, he will not, directly or indirectly, for himself
or any other Person (whether as a proprietor, owner, agent, officer, director,
shareholder, partner, principal, member, employee, contractor, consultant or
any other capacity), induce or attempt to induce any customers, suppliers,
officers, employees, contractors, consultants, agents or representatives of, or
any other person that has a business relationship with, the Bank or any of its
subsidiaries and affiliates to discontinue, terminate or reduce the extent of
their relationship with the Bank and/or any such parent, subsidiary or
affiliate or to take any action that would disrupt or otherwise be
disadvantageous to any such relationship.

 

7.6 Injunction. In
the event of any breach or threatened or attempted breach of any such provision
by Mr. Lapera, the Bank shall, in addition to and not to the exclusion of
any other rights and remedies at law or in equity, be entitled to seek and receive
from any court of competent jurisdiction (i) full temporary and permanent
injunctive relief enjoining and restraining Mr. Lapera and each and every
other Person concerned therein from the continuation of such volatile acts and (ii) a
decree for specific performance of the applicable provisions of this Agreement,
without being required to furnish any bond or other security.

 

6

 

7.7                                 Reasonableness.

 

7.7.1 Mr. Lapera has
carefully read and considered the provisions of this Article 7 and, having
done so, agrees that the restrictions and agreements set forth in this Article 7
are fair and reasonable and are reasonably required for the protection of the
interests of the Bank and its business, shareholders, directors, officers and
employees.  Mr. Lapera further
agrees that the restrictions set forth in this Agreement will not impair or
unreasonably restrain his ability to earn a livelihood.

 

7.7.2 If any court of
competent jurisdiction should determine that the duration, geographical area or
scope of any provision or restriction set forth in this Article 7 exceeds
the maximum duration, geographic area or scope that is reasonable and
enforceable under applicable law, the parties agree that said provision shall
automatically be modified and shall be deemed to extend only over the maximum
duration, geographical area and/or scope as to which such provision or
restriction said court determines to be valid and enforceable under applicable
law, which determination the parties direct the court to make, and the parties
agree to be bound by such modified provision or restriction.

 

8.                                       Change
in Control.

 

8.1           Definition.  “Change in Control” means and shall be deemed
to have occurred if:

 

(a)  there shall be
consummated any consolidation or merger of the Company in which the Company is
not the continuing or surviving corporation or pursuant to which shares of the
Company’s capital stock are converted into cash, securities or other property
other than a consolidation or merger of the Company in which the holders of the
Company’s voting stock immediately before the consolidation or merger shall,
upon consummation of the consolidation or merger, own less than fifty percent
(50%) of the voting stock of the surviving corporation, or any sale of all or
substantially all of the assets of the Company;

 

(b)  any person
(within the meaning of Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) shall after the
Commencement Date become the beneficial owner (within the meaning of Rules 13d-3
and 13d-5 under the Exchange Act), directly or indirectly, of securities
of the Company representing fifty-one percent (51%) or more of the voting power
of then all outstanding securities of the Company entitled to vote generally in
the election of directors of the Company (including, without limitation, any
securities of the Company that any such person has the right to acquire
pursuant to any agreement, or upon exercise of conversion rights, warrants or
options, or otherwise, which shall be deemed beneficially owned by such
person); or

 

(c)  individuals who
at the Commencement Date constitute the entire Board of Directors of the
Company and any new directors whose election by the Board of Directors of the
Company, or whose nomination for election by the Company’s stockholders, shall
have been approved by a vote of at least a majority of the directors then in
office who either were directors at the Commencement Date or whose election or
nomination for election shall have been so approved, shall cease for any reason
to constitute at least a majority of the Board of Directors of the Company.

 

8.2           Change
in Control Termination.  For purposes
of this Agreement, a “Change in Control Termination” means that while this
Agreement is in effect:

 

(a)  Mr. Lapera’s
employment with the Bank is terminated without Cause within one hundred twenty
(120) days immediately (i) prior to and in conjunction with a Change in
Control or (ii) following consummation of a Change in Control; or

 

(b)  Mr. Lapera
is notified within one hundred twenty (120) days immediately prior to or
immediately following consummation of a Change in Control that, as a result of
the Change in Control, he will not be continued in a comparable position (with
comparable compensation and benefits) with the surviving corporation to the
position he holds at the time such notice is given if the notice is given prior
to the Change in Control or, if the notice is given after a Change in Control,
to the position he held immediately prior to the Change in Control, and within
fifteen (15) days after receiving such notification Mr. Lapera notifies
the Bank Board or its successors that he is terminating his employment due to
such change in his employment, with his

 

7

 

last day of employment to
be mutually agreed to by Mr. Lapera, the Bank Board or its successors but
which shall be not more than sixty (60) days after such notice is given by Mr. Lapera;
or

 

(c)   If at the expiration of the one hundred
twenty (120) day period immediately following consummation of a Change in
Control (the “Action Period”) none of the events described in Sections 8.2(a) and
8.2(b) above have occurred, Mr. Lapera, within the thirty (30) day
period immediately following the last day of the Action Period, notifies the
Bank that he is terminating his employment due to the Change in Control, with
his last day of employment to be mutually agreed to by Mr. Lapera, the
Bank or its successors but which shall be not more than sixty (60) days after
such notice is given by Mr. Lapera.

 

8.3           Change
in Control Payment.  If there is a
Change in Control Termination, Mr. Lapera shall be paid a lump-sum cash
payment (the “Change Payment”) by the Bank equal to 2.99 times his Salary at
the highest rate in effect during the twelve (12) month period immediately
preceding his last day of employment, such Change Payment to be made to Mr. Lapera
within forty-five (45) days after his last day of employment.  At Mr. Lapera’s option, he may be paid,
in lieu of a lump-sum cash payment, in monthly payments over a period not to
exceed thirty-six months, but no interest shall accrue or be paid on any
balances.

 

8.4           Adjustment.

 

(a)  Notwithstanding
anything in this Agreement to the contrary, if the Determining Firm (as defined
in Section 8.4(b)) determines that any portion of the Change Payment
and/or the portions, if any, of other payments or distributions in the nature
of compensation by the Bank to or for the benefit of Mr. Lapera (including,
but not limited to, the value of the acceleration in vesting of restricted
stock, options or any other stock-based compensation) whether or not paid or
payable or distributed or distributable pursuant to the terms of this Agreement
(collectively with the Change Payment, the “Aggregate Payment”), would cause
any portion of the Aggregate Payment to be subject to the excise tax imposed by
Code Section 4999 or would be nondeductible by the Bank pursuant to Code Section 280G
(such portion subject to the excise tax or being nondeductible, the “Parachute
Payment”), the Aggregate Payment will be reduced, beginning with the Change
Payment, to an amount which will not cause any portion of the Aggregate Payment
to constitute a Parachute Payment.

 

(b)  All determinations
required to be made under this Section 8.4, will be made by a reputable
law or accounting firm (the “Determining Firm”) selected by the Bank.  All fees and expenses of the Determining Firm
will be obligations solely of the Bank. 
The determination of the Determining Firm will be binding upon Mr. Lapera
and the Bank.

 

9. Assignability.  Mr. Lapera shall have no right to assign
this Agreement or any of his rights or obligations hereunder to another party
or parties.

 

10. Governing Law.
This Agreement shall be governed by and construed in accordance with the laws
of the State of Maryland applicable to contracts executed and to be performed
therein, without giving to the choice of law rules thereof.

 

11. Notices. All
notices, requests, demands and other communications required to be given or
permitted to be given under this Agreement shall be in writing and shall be
conclusively deemed to have been given (1) when hand delivered to the
other party, or (2) when received when by facsimile at the address a number
set forth below provided however, that notices given by facsimile shall
not be effective unless either a duplicate copy of such facsimile notice is
promptly given by depositing same in a United States post office first-class
postage prepaid and addressed to the parties as set forth below, or the
receiving party delivers a written confirmation of receipt for such notice
either by facsimile or any other method permitted under this sub additionally,
any notice given by facsimile shall be deemed received on the next business day
if such notice is received after 5:00 p.m. (recipient’s time) or on a
non-business day); or three (3) business days after the same have been
deposited in a United States post office with first-class certified mail,
return receipt, postage prepaid and addressed to the parties as set forth
below; or (4) the next business day after same have been deposited with a
national overnight delivery service reasonably approved by the parties (Federal
Express and DHL WorldWide Express being deemed approved by the parties),
postage prepaid, addressed to the parties as set forth below with
next-business-day delivery guaranteed, provided that the sending party received
a confirmation of delivery from the delivery service provider. The address of a
party set forth below may be changed by that party by written notice to the
other from time to time pursuant to this Article.

 

8

 

	
  To:

  	
  John N. Burdette

  	
  cc:

  	
  David Baris, Esquire

  
	
   

  	
  Chairman of the Board

  	
   

  	
  Kennedy, Baris, &
  Lundy L.L.P.

  
	
   

  	
  Frederick County Bank

  	
   

  	
  4701 Sangamore Road, Suite P-15

  
	
   

  	
  P.O. Box 1100

  	
   

  	
  Bethesda, MD 20816

  
	
   

  	
  Frederick, MD 21702

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  To:

  	
  Martin S. Lapera

  	
   

  	
   

  
	
   

  	
  228 Braeburn Drive

  	
   

  	
   

  
	
   

  	
  Walkersville, MD 21793

  	
   

  	
   

  

 

12. Entire Agreement.
This Agreement contains all of the agreements and understandings between the
parties hereto with respect to the employment of Mr. Lapera by the Bank,
and supersedes all prior agreements, arrangements and understandings related to
the subject matter hereof, including but not limited to the Employment
Agreement dated September 13, 2001 be and between Frederick County Bank
and Martin S. Lapera. No oral agreements or written correspondence shall be
held to affect the provisions hereof. No representation, promise, inducement or
statement of intention has been made by either party that is not set forth in
this Agreement, and neither party shall be bound by or liable for any alleged
representation, promise, inducement or statement of intention not so set forth.

 

13. Headings. The Article and
Section headings contained in this Agreement are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.

 

14. Severability.
Should any part of this Agreement for any reason be declared or held illegal,
invalid or unenforceable, such determination shall not affect the legality,
validity or enforceability of any remaining portion or provision of this
Agreement, which remaining portions and provisions shall remain in force and
effect as if this Agreement has been executed with the illegal, invalid or
unenforceable portion thereof eliminated.

 

15. Amendment: Waiver.
Neither this Agreement nor any provision hereof may be amended, modified,
changed, waived, discharged or terminated except by an instrument in writing
signed by the party against which enforcement of the amendment, modification,
change, waiver, discharge or termination is sought. The failure of either party
at any time or times to require performance of any provision hereof shall not
in any manner affect the right at a later time to enforce

 

the
same. No waiver by either party of the breach of any term, provision or
covenant contained in this Agreement, whether by conduct or otherwise, in any
one or more instances, shall be deemed to be, or construed as, a further or
continuing waiver of any such breach, or a waiver of the breach of any other
term, provision or covenant contained in this Agreement.

 

16. Gender and Tense.
As used in this Agreement, the masculine, feminine and neuter gender, and the
singular or plural number, shall each be deemed to include the other or others
whenever the context so indicates.

 

17. Binding Effect.
This Agreement is and shall be binding upon, and inures to the benefit of, the
Bank, its successors and assigns, and Mr. Lapera and his heirs, executors,
administrators, and personal and legal representatives.

 

IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first written above.

 

FREDERICK
COUNTY BANK

 

 

	
  By:

  	
  /s/ John N. Burdette

  	
   

  	
  By:

  	
  /s/ Martin S. Lapera

  	
   

  
	
   

  	
   John N. Burdette

  	
   

  	
   Martin S. Lapera

  
	
   

  	
   

  	
   

  	
   

  
	
  Title: 

  	
  Chairman of the Board

  	
   

  	
  Title:

  	
  President &
  Chief Executive Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  May 23, 2005

  	
   

  	 

	
  Date

  	
   

  	
   

  	 

												

 

9

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