Document:

Exhibit

PBF ENERGY INC.
2017 EQUITY INCENTIVE PLAN

FORM OF
AMENDED AND RESTATED NON-QUALIFIED STOCK OPTION AGREEMENT 
    
THIS AGREEMENT (the “Agreement”), is made effective as of the date set forth on the signature page hereto (the “Date of Grant”), between PBF Energy Inc. (the “Company”) and the individual named on the signature page hereto (the “Grantee”).

R E C I T A L S:

WHEREAS, the Company has adopted the Plan (as defined below), the terms of which are hereby incorporated by reference and made a part of this Agreement; and
    
WHEREAS, the Committee (as defined in the Plan) has determined that it would be in the best interests of the Company and its stockholders to grant the Option (as defined below) provided for herein to the Grantee pursuant to the Plan and the terms set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties agree as follows:

1.Definitions. Whenever the following terms are used in this Agreement, they shall have the meanings set forth below. Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan.

(a)Company Group: The Company and its subsidiaries and Affiliates.

(b)Disability: Disabled or Disability with respect to a Grantee, means the definition of Disabled or Disability used in such Grantee’s employment agreement or agreement to provide services, or if no such agreement exists, or such term is not defined therein, “disabled” or “disability” means that such Grantee becomes physically or mentally incapacitated and is therefore unable for a period of six consecutive months or for an aggregate of nine months in any twenty-four consecutive month period to perform such Grantee’s duties as an employee of or service provider to the Company Group. The determination of a disability will be made by the Company, provided that, in the event that an Option should become subject to Section 409A, with respect to such Option, “Disabled” and “Disability” shall have the meaning set forth in Section 409A and Treasury Regulation Section 1.409A-3(i)(4) thereunder, unless determined otherwise in the discretion of the Committee.

(c)Expiration Date: The tenth anniversary of the Date of Grant; provided, that, if the term of the Option would expire during a period when trading in the Shares is prohibited or restricted by law or under the Company’s insider trading policy, the Expiration Date will be extended automatically to the 30th day after expiration of the prohibition or restriction to the extent such automatic extension would not cause the Option to become subject to Section 409A.

(d)Option:  The Option with respect to which the terms and conditions are set forth in Section 3 of this Agreement.

(e)Plan:  The PBF Energy Inc. 2017 Equity Incentive Plan, as it may be amended or supplemented from time to time.

(f)[Restrictive Covenants:  The Restrictive Covenants applicable to the Grantee pursuant to Sections 9 and 10 of such Grantee’s [employment agreement with PBF Investments LLC]; provided, for such purpose, the Non Compete Period shall be deemed to extend through the first anniversary of the Grantee’s termination of employment for any reason solely for purposes of Section 9(b) thereof (providing for an additional six month period of non-solicitation).]1 

(g)Retirement: The Grantee’s resignation from employment with the Company Group, so long as Grantee has attained age 55 1/2 with at least three consecutive years of service with the Company Group.

(h)Section 409A:  Section 409A means Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations, rulings, notices or other guidance promulgated thereunder.

(i)Vested Portion:  At any time, the portion of the Option which has become vested, as described in Section 3 of this Agreement.

2.Grant of the Option.  The Company hereby grants to the Grantee the right and option to purchase, on the terms and conditions hereinafter set forth, all or any part of the number of Shares subject to the Option set forth on the signature page hereto, subject to adjustment as set forth in the Plan.  The Exercise Price shall be as set forth on the signature page hereto.  The Option is intended to be a nonqualified stock option, and is not intended to be treated as an incentive stock option that complies with Section 422 of the Code.
3.Vesting of the Option.

(a)General.  Subject to the Grantee’s continued service or employment with the Company Group through the applicable vesting date, the Option shall vest and become exercisable (for the period set forth in Section 4 hereof) at the times set forth on the signature page hereto.

(b)Termination of Employment.  If the Grantee’s service or employment with the Company Group terminates for any reason, including, without limitation, for Cause, unless otherwise provided for in Section 3(c) and (d) hereof, the Option, to the extent not then vested and exercisable, shall be immediately canceled by the Company without consideration.

(c)Death or Disability.  Notwithstanding anything to the contrary in this Agreement, in the event of the Grantee’s separation from service from the Company Group due to death or Disability, the Option shall, to the extent not then vested or previously forfeited or cancelled, become fully vested and exercisable effective as of the termination date.

(d)Change in Control.  In the event of a Change in Control, the Option shall, only to the extent not then vested or previously forfeited or cancelled, become fully vested and exercisable effective as of the date of a Change in Control.

_____________________________ 
1 Restrictive covenants are not included for the lower level grantees. 

4.Exercise of the Option.

(a)Period of Exercise.  Subject to the provisions of the Plan and this Agreement, the Grantee may exercise all or any part of the Vested Portion of the Option at any time prior to the Expiration 
Date.  Notwithstanding the foregoing, at any time prior to the Expiration Date, the Vested Portion of the Option shall only remain exercisable for the period set forth below with respect to the particular event:

(i)Termination due to Death or Disability, or Death following Termination.  
If (A) the Grantee’s service or employment with the Company Group is terminated due to the Grantee’s death or Disability, or (B) if following the Grantee’s separation from service but prior to the date the exercise period would expire pursuant to clause (ii) below, the Grantee dies, the Grantee (or the Grantee’s permitted transferee(s) or estate) may exercise the Vested Portion of the Option for a period ending on the earlier of (A) twelve (12) months following Grantee’s separation from service and (B) the Expiration Date;

(ii)Termination for any Reason Other than Death, Disability, Retirement or Cause.     If the Grantee’s service or employment with the Company Group is terminated for any reason other than due to the Grantee’s death, Disability, Retirement or Cause subject to clause (i) above in the case of the Grantee’s death following termination, the Grantee may exercise the Vested Portion of the Option for a period ending on the earlier of (A) three (3) months following such separation from service and (B) the Expiration Date.

(iii)Retirement.  If the Grantee Retires from the Company Group, the Grantee may exercise the Vested Portion of the Option for a period ending on the earlier of (A) three (3) years following such separation from service and (B) the Expiration Date.

(b)Termination by the Company for Cause; Breach of Restrictive Covenants.  Notwithstanding (a) above, if the Grantee’s service or employment is terminated by the Company Group for Cause, or if at any time the Grantee breaches the Restrictive Covenants, the Vested Portion of the Option shall immediately terminate in full and cease to be exercisable.

(c)Method of Exercise.

(i)Subject to Section 4(a) of this Agreement and any administrative procedures that may be established by the Company, the Vested Portion of the Option then exercisable may be exercised by delivering to the Company written notice of intent to so exercise and may be exercised pursuant to any method prescribed in Section 5(c) of the Plan; provided that the Option may be exercised with respect to whole Shares only.  Such notice shall specify the number of Shares for which the Option is being exercised and shall be accompanied by payment in full of the Exercise Price. The payment of the Exercise Price may be made at the election of the Grantee in the form and manner provided for in the Plan and shall be subject to Section 8 of this Agreement and to Section 15 of the Plan.  
(ii)Notwithstanding any other provision of the Plan or this Agreement to the contrary, the Option may not be exercised prior to the completion of any registration or qualification of the Option or the Shares under applicable state and federal securities or other laws, or under any ruling or regulation of any governmental body or national securities exchange that the Committee shall in its sole discretion determine to be necessary or advisable.

(iii)Upon the Company’s determination that the Option has been validly exercised as to any of the Shares, the Company may issue certificates in the Grantee’s name for such Shares.  However, the Company shall not be liable to the Grantee for damages relating to any delays in issuing the certificates, if any, to the Grantee, any loss by the Grantee of any certificates, or any mistakes or errors in the issuance of any certificates or in the certificates themselves, if any.  Notwithstanding the foregoing, the Company may elect to recognize the Grantee’s ownership through uncertificated book entry.

(iv)In the event of the Grantee’s death, the Vested Portion of the Option shall remain exercisable by the Grantee’s executor or administrator, or the person or persons to whom the Grantee’s rights under this Agreement shall pass by will or by the laws of descent and distribution as the case may be, to the extent set forth in Section 4(a) of this Agreement.  Any heir or legatee of the Grantee shall take rights herein granted subject to the terms and conditions hereof.

5.No Right to Continued Employment or Service.  Neither the Plan nor this Agreement shall be construed as giving the Grantee the right to be retained in the employ of, or in any consulting relationship to, any member of the Company Group.  Further, any member of the Company Group may at any time dismiss the Grantee or discontinue any employment or consulting relationship, free from any liability or any claim under the Plan or this Agreement, except as otherwise expressly provided herein.  Any determinations as to whether the Grantee continues to be employed shall be at the discretion of the Committee.

6.Legend on Certificates.  To the extent applicable, all certificates (or book entries) representing the Shares purchased by exercise of the Option shall be subject to the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which such Shares are listed, and any applicable federal or state laws, and the Committee may cause a legend or legends to be put on any such certificates (or notations made next to the book entries) to make appropriate reference to such restrictions.

7.Transferability.  The Option shall not be transferable or assignable by the Grantee other than by will or by the laws of descent and distribution; provided, that, subject to the approval by the Committee, in its discretion, the Option may be transferred for no consideration to, or for the benefit of, an “immediate family member” (to be defined by the Committee) or to a bona fide trust for the exclusive benefit of such immediate family member, or a partnership or limited liability company in which immediate family members are the only partners or members (a “Permitted Transferee”).  If the Option is exercisable after the death of a Grantee, the Option may be exercised by his or her legatees, personal representatives, or distributees.  No exercise of the Option may be made during a Grantee’s lifetime by anyone other than the Grantee, except (i) by a legal representative appointed for or by the Grantee, or (ii) if applicable, a Permitted Transferee.  Any sale, exchange, transfer, assignment, pledge, hypothecation, fractionalization, hedge or other disposition in violation of this Section 7 shall be void, and shall not be recognized by the Company.  All of the terms and conditions of the Plan and this Agreement shall be binding upon any permitted successors and assigns or Permitted Transferees.

8.Withholding.  The Grantee may be required to pay to the Company Group and the Company Group shall have the right and is authorized to withhold any applicable withholding or other taxes in respect of the Option, its exercise, or any payment or transfer under or with respect to the Option and to take such other action as may be necessary in the opinion of the Committee to satisfy all obligations for the payment of such withholding or other taxes.  The Grantee may elect to pay any or all of such required withholding or other required taxes as provided in Section 15 of the Plan, including by having the Company withhold Shares otherwise deliverable upon exercise of an Option; provided, that, the Fair Market Value of 

the aggregate number of shares withheld in connection with the satisfaction of the Grantee’s obligations under this Section 8 shall not exceed the minimum statutorily required withholding amount.

9.Securities Laws.  Upon the acquisition of any Shares pursuant to the exercise of the Option, the Grantee will make or enter into such written representations, warranties and agreements as the Committee may reasonably request in order to comply with applicable securities laws or with this Agreement.

10.Notices.  Any notice under this Agreement shall be addressed to the Company in care of its Secretary, and to the Grantee at the address appearing in the personnel records of the Company for the Grantee or to either party at such other address as either party hereto may hereafter designate in writing to the other.  Any such notice shall be deemed effective upon receipt thereof by the addressee.

11.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the state of Delaware without regard to conflicts of laws.

12.Arbitration.  Any dispute with regard to the enforcement of this Agreement shall be exclusively resolved by a single experienced arbitrator, selected in accordance with the American Arbitration Association (“AAA”) rules and procedures, at an arbitration to be conducted in the State of New York pursuant to the National Rules for the Resolution of Employment Disputes rules of AAA with the arbitrator applying the substantive law of the State of Delaware as provided for under Section 11 hereof.  The AAA shall provide the parties hereto with lists for the selection of arbitrators composed entirely of arbitrators who are members of the National Academy of Arbitrators and who have prior experience in the arbitration of disputes between employers and senior executives.  The determination of the arbitrator shall be final and binding on the parties hereto and judgment therein may be entered in any court of competent jurisdiction.  Each party shall pay its own attorneys’ fees and disbursements and other costs of the arbitration.

13.Amendment.  This Agreement may be amended only by a written instrument executed by the parties hereto, which specifically states that it is amending this Agreement.

14.Option Subject to Plan.  By entering into this Agreement the Grantee agrees and acknowledges that the Grantee has received and read a copy of the Plan.  The Option is subject to the Plan.  The terms and provisions of the Plan, as they may be amended from time to time, are hereby incorporated by reference.  In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail, except where the terms of this Agreement are more restrictive than the terms of the Plan.

15.Severability.  In the event that any one or more of the provisions of this Agreement shall be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions of this Agreement shall not be affected thereby. 

16.Restrictive Covenants.

(a)Non-Competition. The Grantee shall not, at any time beginning on the Date of Grant and ending on the date that is six (6) months following the Grantee’s separation from service from the Company Group for any reason, be a more than 5% shareholder, director, officer or employee of any person, firm, corporation, partnership or business that engages in a business which competes directly with the Business (as defined below).

(b) Non-Solicitation. During the period beginning on the Date of Grant and ending on the date that is twelve months following the Grantee’s separation from service from the Company Group for 

any reason, the Grantee shall not directly recruit or otherwise solicit or induce any employee of the Company Group to terminate his or her employment with the Company Group in order to be hired by the Grantee in a business which competes directly with the Business; provided, however, that general solicitation or advertising for employment by the Grantee shall not be prohibited by this Section 16(b).

(c)Non-Disparagement. During the Grantee’s employment and at any time following his or her termination, the Grantee agrees not to disparage, either orally or in writing, in any material respect any member of the Company Group.

(d)Reformation. In the event the terms of this Section 16 shall be determined by any court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too great a geographical area or by reason of its being too extensive in any other respect, it will be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action.

(e)Business. As used in Sections 16 and 17 hereof, the term “Business” shall mean the crude oil refining business in the specific geographic areas in which the Company’s oil refining operations primarily conduct business at the date of the Grantee’s termination.

17.Non-Disclosure of Confidential Information.

(a)Protection of Confidential Information. All items of information, documents (including electronically stored documents like email), and materials pertaining to the business and operations of the Company Group that are not made public by the Company Group through authorized means will be considered confidential (hereafter, “Confidential Information”). Confidential Information includes, but is not limited to, customer lists, business referral source lists, internal cost and pricing data and analysis, marketing plans and strategies, personnel files and evaluations, financial and accounting data, operational and other business affairs and methods, contracts, technical data, know-how, trade secrets, computer software and other proprietary and intellectual property, and plans and strategies for future developments relating to any of the foregoing. Except in connection with the faithful performance of the Grantee’s duties hereunder or as permitted pursuant to Sections 17(c), (d) and (e), the Grantee shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his or her benefit or the benefit of any person, firm, corporation or other entity any Confidential Information, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such Confidential Information. The parties hereby stipulate and agree that as between them the foregoing matters are important, material and confidential proprietary information and trade secrets and affect the successful conduct of the businesses of the Company Group, or any of its successors.
(b)Return of Confidential Information. Upon termination of the Grantee’s service or employment with the Company for any reason, the Grantee upon the request of the Company will promptly either destroy or deliver to the Company any and all Confidential Information in the Grantee’s possession and any other documents concerning the customers, business plans, marketing strategies, products or processes of the Company Group. 

(c)No Prohibition. Nothing in this Agreement shall prohibit the Grantee from (i) disclosing information and documents when required by law, subpoena or court order (provided, except as stipulated in Sections 17(c), (d) and (e), the Grantee gives reasonable notice thereof and makes reasonably available to the Company and its counsel the documents and other information sought and assists such counsel, at the Company’s expense, in resisting or otherwise responding to such order or process), (ii) 

disclosing information and documents to his or her attorney or tax adviser for the purpose of securing legal or tax advice, (iii) disclosing the post-employment restrictions in this Agreement to any potential new employer, (iv) retaining, at any time, his or her personal correspondence, his or her personal rolodex or outlook contacts and documents related to his or her own personal benefits, entitlements and obligations, or (v) disclosing or retaining information that, through no act of the Grantee in breach of this Agreement or any other party in violation of an existing confidentiality agreement with the Company, is generally available to the public, is in the public domain at the time of disclosure or is available from other sources.

(d)Whistleblower Protection. Notwithstanding anything herein or in any other agreement with or policy (including without limitation any code of conduct or employee manual) of the Company, nothing herein or therein is intended to or shall (i) prohibit or restrict the Grantee or his or her attorney from reporting possible violations of federal or state law or regulation to any government agency, commission or entity, including, but not limited to, the Department of Justice, the Commodities Futures Trading Commission, the Securities and Exchange Commission, the Department of Labor, Congress, any state Attorney General, any self-regulatory organization or any agency Inspector General (“Government Agencies”); (ii) prohibit or restrict the Grantee or his or her attorney from initiating communications directly with; responding to any inquiry from; volunteering information to; or testifying or otherwise participating in or assisting in any inquiry, investigation or proceeding brought by Government Agencies in connection with a disclosure made under a whistleblower law or regulation; (iii) prohibit or restrict the Grantee or his or her attorney from making disclosures that are protected under the whistleblower provisions of federal or state law or regulation; (iv) require the Grantee to provide notice to or receive authorization from the Company prior to making reports or disclosures to Government Agencies; or (v) result in a waiver or other limitation of the Grantee’s rights and remedies as a whistleblower, including to a monetary award. The Company will not take action under any agreement or policy against or sanction anyone who reports suspected violations of Company policies or any law or regulation. Furthermore, the Company prohibits retaliation against anyone who reports suspected violations of Company policies or any law or regulation.

(e)Disclosure of Trade Secrets. The Grantee will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, in each case, solely for the purpose of reporting or investigating a suspected violation of law or (ii) in a complaint or other document filed in a lawsuit or proceeding, if such filings are made under seal.

(f)Specific Performance. The Grantee acknowledges and agrees that remedies at law available to the Company for a breach or threatened breach of any of the provisions of Sections 16 or 17 would be inadequate and any member of the Company Group would suffer irreparable damages as a result of such breach or threatened breach.  In recognition of this fact, the Grantee agrees that, in the event of such a breach or threatened breach, in addition to any remedies at law, the Company without posting any bond, shall be entitled to obtain equitable relief in the form of specific performance, temporary restraining order, temporary or permanent injunction or any other equitable remedy which may then be available.

(g)Section Headings; Construction.  The section headings contained herein are for the purpose of convenience only and are not intended to define or limit the contents of the sections.  All words used in this Agreement shall be construed to be of such gender or number, as the circumstances require.  Unless otherwise expressly provided, the word “including” does not limit the preceding words or terms.

(h)Signature in Counterparts.  This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.
[The remainder of this page intentionally left blank.]

IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto.
	
			
	 
	PBF ENERGY INC.

	 
	 

	 
	By
	 

	 
	 
	Name: 

	 
	 
	Title: 

	 
	 

	 
	 

	 
	[Grantee]

	 
	 

The Date of Grant is [Date].
The number of Shares subject to the Option is [#].
The Exercise Price shall be $[#] per Share.
Subject to the Grantee’s continued service or employment through the applicable vesting date, the Option shall vest and become exercisable as follows: 
	
		
	Date Option Vests and Becomes Exercisable
	Percentage of 
Shares As to Which Option
Vests and First Becomes Exercisable

	 
	 

	Upon the first anniversary of the Grant Date
	25%

	 
	 

	Upon the second anniversary of the Grant Date
	25%

	 
	 

	Upon the third anniversary of the Grant Date
	25%

	 
	 

	Upon the fourth anniversary of the Grant Date
	25%

[Signature Page to Non-Qualified Stock Option Agreement]Ex_101

		
			Exhibit 10.1
		

		
			 
		

		
			EMPLOYMENT AGREEMENT
		

		
			 
		

		
			THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of the 3rd day of January, 1998, by and between Colorado Business Bankshares, Inc., a Colorado corporation ("Company"), and Richard J. Dalton ("Employee").
		

		
			 
		

		
			WITNESSETH:
		

		
			 
		

		
			WHEREAS, Company desires Employee to become employed by Company and Employee desires to become employed by Company upon the terms and conditions hereinafter set forth.
		

		
			 
		

		
			NOW, THEREFORE, the parties agree as follows:
		

		
			 
		

		
			1. EMPLOYMENT. Company hereby agrees to employ Employee, and Employee hereby agrees to be employed by Company, as (a) a Senior Vice President of the Company, (b) Chief Financial Officer of the Company and (c) a Senior Vice President and Chief Financial Officer of the Company's wholly-owned subsidiary Colorado Business Bank, N.A.(the "Bank"), and (d) such other or different executive capacities as may be determined from time to time by the Boards of Directors of Company and the Bank.
		

		
			 
		

		
			2. RESPONSIBILITIES OF EMPLOYMENT. During the term of his employment,
		

		
			 
		

		
			Employee:
		

		
			 
		

			
	
			
				 (a)
			

			
	
			
			shall diligently and faithfully serve Company and the Bank in such executive capacities as may be determined from time to time by the Boards of Directors of Company and the Bank, and he shall devote his best efforts and entire business time, services and attention to the advancement of Company's interests;

		
			 
		

			
	
			
				 (b)
			

			
	
			
			shall not, without the prior written consent of the Board of Directors of Company, engage in any other employment or business, directly or indirectly, as a sole proprietor, a member of a partnership or limited liability company, as a director, officer, employee or shareholder of a corporation not affiliated with Company, or as a consultant or otherwise, whether for compensation or otherwise, which could reasonably be expected to or does interfere with Employee's performance of his duties hereunder or which business is in competition in any way with the business then being conducted by Company or the Bank; provided, however, that the provisions of this subparagraph (b) shall not be deemed to prohibit Employee's ownership of stock in any publicly owned corporation so long as Employee's ownership, directly and indirectly, when aggregated with the direct and indirect ownership of all members of 

		 

 

	Employee's family, does not exceed one percent (1%) of the total outstanding stock of such publicly owned corporation, measured by reference to either market value or voting power;

		
			 
		

			
	
			
				 (c)
			

			
	
			
			shall diligently and faithfully carry out the policies, programs and directions of the Boards of Directors of Company and the Bank;

		
			 
		

			
	
			
				 (d)
			

			
	
			
			shall fully cooperate with such other officers of the Company and the Bank as may be elected or appointed by the Boards of Directors of Company and the Bank; and

		
			 
		

		
			(e) shall report to the Chief Executive Officer of Company.
		

		
			 
		

		
			3. COMPENSATION. Company will compensate Employee for his services during the term of this Agreement and his employment hereunder as follows:
		

		
			 
		

			
	
			
				 (a)
			

			
	
			
			Basic Compensation. Company shall pay to Employee as basic compensation the sum of Ninety Thousand Dollars ($90,000.00) per year, payable in equal monthly installments. Employee's basic compensation may be increased from time to time in the sole discretion of Company's Board of Directors.

		
			 
		

			
	
			
				 (b)
			

			
	
			
			Benefits. Employee shall be entitled to use a Company automobile (model and year to be agreed upon from time to time by Employee and Company's Chief Executive officer) in the course of performing his duties hereunder and shall be entitled to participate in any and all other benefits from time to time afforded executive employees of Company, including, without limitation, health, accident, hospitalization and life insurance programs. Company shall additionally pay the monthly (not initial or initiation) dues for Employee at a country, health or social club to be agreed upon by Employee and Company's Chief Executive Officer.

		
			 
		

			
	
			
				 (c)
			

			
	
			
			Reimbursement of Expenses. Employee shall be entitled to reimbursement of ordinary and necessary out-of-pocket expenses reasonably incurred by him on behalf of Company in the course of performing his duties hereunder, subject to his furnishing appropriate documentation relative to such expenses in form and substance satisfactory to Company.

		
			 
		

			
	
			
				 (d)
			

			
	
			
			Vacations. Employee shall be entitled to four (4) weeks paid vacation each year, subject to Company's general vacation policy.

		
			 
		

			
	
			
				 (e)
			

			
	
			
			Discretionary Bonus Plan. Company has a discretionary bonus plan for key executives. Employee shall be entitled to participate in such discretionary bonus plan.

		
			 
		

			
	
			
				 (f)
			

			
	
			
			Stock Option. Company has an Incentive Stock Option Plan (the “Plan") for key employees. Employee shall be entitled to participate in the plan.

		
			

		 

 

		

		
			 
		

			
	
			
				 (g)
			

			
	
			
			 Allocations. As Company and Employee intend that Employee will be a dual employee of Company and the Bank, and that Employee will be devoting substantial time and attention to the affairs of the Bank, Company may allocate to the Bank any portion of Employee's basic and other compensation that Company and the Bank deem to be a lawful and appropriate allocation, but no such allocation will relieve Company of any of its obligations to Employee under this Agreement.

		
			 
		

		
			4. TERM AND TERMINATION.
		

		
			 
		

			
	
			
				 (a)
			

			
	
			
			Term. The term of Employee's employment shall be a one (1) year term beginning on the date hereof. Upon expiration of the stated term of this Agreement, Employee's employment with Company shall revert to the status of employment at will and shall thereafter be subject to termination by either party and at any time subject to the rights and obligations of employee as defined in 4(b).

		
			 
		

		
			(b) Termination. Upon termination of this Agreement by Company, by Employee upon the death or disability of Employee, the rights and obligations of Employee shall be as follows:
		

		
			(i) Termination by Employee. In the event Employee elects to terminate his employment hereunder, this Agreement shall immediately terminate without any further obligation on the part of Company, except that Company shall pay to Employee such compensation pursuant to Paragraph 3 hereof as may be accrued and unpaid on the date of termination of employment.
		

		
			 
		

		
			(ii) Termination by Company for Cause. If Employee's employment hereunder is terminated by Company for cause, this Agreement shall immediately terminate without any further obligation on the part of Company, except that Company shall pay to Employee such compensation pursuant to Paragraph 3 hereof as may be accrued and unpaid on the date of such termination of employment. For purposes of this Agreement, "cause" shall mean willful failure or neglect of Employee to perform his duties as prescribed herein, the conviction of a felony, theft, embezzlement or improper use of corporate funds by Employee, self-dealing detrimental to Company, any attempt to obtain any personal profit from any transaction in which Company has an interest or any breach of the terms of Paragraphs 6 or 7 of this Agreement by Employee.
		

		
			 
		

		
			(iii) Termination by Company for Other Reasons. Company shall have the right at any time to terminate Employee’s employment hereunder for any reason by giving him written notice (which notice shall fix the date as of which Employee's employment is to terminate) of its intention to do so. If Employee's employment hereunder is terminated by Company other than 

		 

 

for cause, Company shall be obligated to pay Employee the severance benefits set forth in Paragraph 4( c) hereof.
		

		
			 
		

		
			(iv) Constructive Discharge. If Employee is ever constructively discharged, he may terminate this Agreement and his employment hereunder by delivering written notice to Company no later than thirty (30) days before the effective date of termination. If Employee is constructively discharged, Company shall be obligated to pay Employee the severance benefits set forth in Paragraph 4 (c) hereof. For purposes of the foregoing, "constructive discharge" means the occurrence of any one or more of the following: (i) Employee is removed from all of the offices described in Paragraph 1 hereof; (ii) Company fails to vest with or removes from Employee the duties, responsibilities, authority or resources that he reasonably needs to competently perform the duties of his office;(i) Company decreases Employee's basic compensation or arbitrarily and capriciously decreases Employee's bonus; or (iv) Company transfers Employee to a location outside the Denver metropolitan area: and in any of such events, Company fails to cure any of the above within thirty (30) days after Employee gives Company written notice of such breach.
		

		
			 
		

		
			(v) Termination Upon Change of Control. Employee may terminate this Agreement and his employment hereunder for any reason within two (2) years after a Change of Control occurs by delivering written notice of termination to Company or its successor no less than thirty (30) days before the effective date of termination. After two (2) years following the Change of Control, Employee may terminate this Agreement and his employment hereunder only in accordance with Paragraph 4 (b) (i) hereof. If Employee so terminates, Company shall be obligated to pay Employee one and ninety-nine hundredths (1.99) times the severance benefits set forth in Paragraph 4 ( c) hereof, with the exception that the Paragraph 4 ( c) (ii) bonus component shall be based upon a full year and not prorated to the date of Employee's termination. (A) A “Change of Control" will be deemed to have occurred if: a) any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the "1934 Act") other than a person who is a shareholder of Company as of the date of this Agreement acquires beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of Company; or b) the individuals who were members of Company's Board of Directors as of the date of this Agreement (the "Current Board Members") cease for any reason to constitute a majority of the Board of Directors of Company or its successor; however, if the election or the nomination for election of any new director of Company or its successor is approved by a vote of a majority of the individuals who are Current Board Members, such new director shall, for the purposes of this paragraph, be considered a Current 

		 

 

Board Member; or c) Company's stockholders approve (1) a merger or consolidation of Company or the Bank and the stockholders of Company immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the outstanding securities of Company immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of Company or the Bank. (B) Notwithstanding and in lieu of Paragraph 4(b)(v)(A), a Change of Control will not be deemed to have occurred: a) solely because fifty percent (50%)or more of the combined voting power of the then outstanding voting securities of Company are acquired by (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of Company or the Bank, or (2) any person pursuant to the will or trust of any existing stockholder of Company, or who is a member of the immediate family of such stockholder, or (3) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the stockholders in the same proportion as their ownership of stock immediately prior to such acquisition; or b) if Employee agrees in writing to waive a particular Change of Control for the purposes of this Agreement.
		

		
			 
		

		
			(vi) Termination Upon Employee's Disability. In the event Employee's employment is terminated by Company due to Employee's disability, Company shall be obligated to pay Employee the severance benefits set forth in Paragraph 4 ( c) hereof. For purposes of the foregoing, "disability,' shall mean Employee's inability due to illness or other physical or mental disability to substantially perform his duties as prescribed herein for a period of forty-five (45) days within any consecutive six (6) month period, and any action to be taken hereunder based on disability shall not be effective until the expiration of such forty-five (45) day period.
		

		
			 
		

		
			(vii) Termination Upon Employee's Death. In the event that Employee dies while employed by Company, then Company shall he obligated to pay Employee's estate the severance benefits set forth in Paragraph 4 ( c) hereof.
		

		
			 
		

		
			(viii) Continuing Obligations of Employee. Notwithstanding anything to the contrary contained herein, termination of this Agreement or Employee's employment hereunder, for whatsoever reason or for no reason at all, by Employee or otherwise, shall not be deemed in any way to affect Employee's obligations under Paragraphs 6 and 7 of this Agreement, with respect to which he shall remain bound.
		

		
			

		 

 

		

			
	
			
				 (b)
			

			
	
			
			Severance Benefits. Provided Employee is in compliance with Paragraph 4(b)(viii) hereof, Company will pay or provide the following severance benefits Employee in lieu of any separation payments otherwise provided upon termination of employment under any other severance pay or similar plan or policy of Company:

		
			 
		

		
			(i) Twelve (12) consecutive monthly payments each equal to one- twelfth (1/12th) of Employee's annual basic compensation in effect immediately prior to Employee's termination;
		

		
			 
		

		
			(ii) Twelve (12) consecutive monthly payments each equal to one-twelfth (1/12th) of the higher of (A) Employee's discretionary bonus for the previous calendar year, or (B) the average of Employee's discretionary bonus for the previous three (3) calendar years (or such fewer calendar years as Employee has been employed), in each case prorated to the date of Employee's termination;
		

		
			 
		

		
			(iii) For the twelve (12) month period following the date of termination of Employee's employment, Company will maintain in full force and effect for the continued benefit of Employee each employee benefit plan in which Employee was a participant immediately prior to the date of Employee's termination, unless an essentially equivalent and no less favorable benefit is provided by a subsequent employer at no additional cost to Employee. If the terms of any employee benefit plan of Company do not permit continued participation by Employee, then Company will arrange to provide to Employee (at Company's cost) a benefit substantially similar to and no less favorable than the benefit Employee was entitled to receive under such plan at the end of the period of coverage. (This provision specifically is not applicable to Employee's automobile and club dues, which benefits end upon Employee's date of termination of employment.)
		

		
			 
		

		
			(iv) For the twelve (12) month period following the date of termination of Employee's employment, Company will treat Employee for all purposes as an Employee under all of Company's retirement plans in which Employee was a participant on the date of termination of Employee's employment or under which Employee would become eligible during such twelve (12) month period (hereinafter referred to collectively as the "Plan"). Benefits due to Employee under the Plan shall be computed as if Employee had continued to be an Employee of Company for the twelve (12) month period following termination of employment. If under the terms of the Plan such continued coverage is not permitted, Company will pay to Employee or Employee's estate a supplemental benefit in an amount which, when added to the benefits that Employee is entitled to receive under the Plan, shall equal the amount that Employee would have received under the Plan had Employee remained an employee of Company during 

		 

 

such twelve (12) month period.
		

		
			(v) If any excise tax imposed under Internal Revenue Code Section 4999 or any successor provision, as amended after the date hereof, is due and owing by Employee as a result of any amount paid or payable pursuant to this Paragraph 4 (c), Company shall indemnify and hold Employee harmless against all such excise taxes and any interest, penalties or costs with respect thereto.
		

		
			 
		

		
			(vi) Company will be obligated to make all payments that become due to Employee under this Paragraph 4 (c) whether or not he obtains other employment following termination. The payments and other benefits provided for in this Paragraph 4 (c) are intended to supplement any compensation or other benefits that have accrued or vested with respect to Employee or his account as of the effective date of termination.
		

		
			(vii) Company may elect to defer any payments that may become due to Employee under this Paragraph 4 (c) if, at the time the payments become due, Company or the Bank is not in compliance with any regulatory mandated minimum capital requirements or if making the payments would cause Company's or the Bank's capital to fall below such minimum capital requirements. In this event, Company will resume making the payments as soon as it can do so without violating such minimum capital requirements.
		

		
			 
		

		
			5. SALE OR REORGANIZATION OF COMPANY. This Agreement shall not restrict the sale, transfer, consolidation, liquidation, reorganization or disposition of the assets of Company and to the extent that the business of Company is conducted in another form or through another entity or entities, such entity or entities shall be obligated to fulfill Company's obligations hereunder.
		

		
			 
		

		
			6. RESTRICTIVE COVENANT. It is mutually recognized and agreed that the services to be rendered pursuant to this Agreement by Employee are special, unique and of extraordinary character. Therefore, as a condition to Company's obligations hereunder, Employee agrees that without Company's prior written consent, during the term of this Agreement and for a period ending on the first anniversary of the date of termination of his employment hereunder, regardless of cause, he will not engage in any manner, directly or indirectly, to solicit or induce any employee or agent of Company or the Bank to terminate employment with Company or the Bank, as the case may be, or solicit or induce any customer of Company or the Bank to become a customer of any person, firm, partnership, corporation, trust or other entity that owns, controls or is a bank, savings and loan association, credit union or similar financial institution. Furthermore, Employee will at no time during or subsequent to the term of his employment by Company make any statements or take any actions which could reasonably be expected to damage the reputation or business of Company. It is further recognized and agreed that irreparable injury will result to Company, its businesses and property in the event of a breach of this covenant by Employee, that such injury would be difficult if not impossible to ascertain, and therefore, any remedy at law for any breach by Employee of this covenant will be inadequate and Company shall be entitled to temporary and permanent injunctive relief 

		 

 

without the necessity of proving actual damage to Company by reason of any such breach. In addition, in the event of a breach of this covenant by Employee, Company shall also be entitled to recover reasonable costs and attorneys' fees incurred in connection with the enforcement of its rights hereunder. Whenever used herein, Company shall be deemed to include any successors or any other person or entity which may hereafter acquire the business of Company or the Bank. The foregoing notwithstanding, should the assets of Company he disposed of in such a manner that no purchaser thereof has acquired a going business, then Employee shall not be bound by the covenants expressed in this paragraph.
		

		
			 
		

		
			7. TRADE SECRETS AND CONFIDENTIAL INFORMATION. Employee hereby covenants and agrees that he will not, except as may be required in connection with his employment under this Agreement, directly or indirectly, use or disclose to any other person, firm or corporation, whether during or subsequent to the term of his employment by Company, irrespective of the time, manner or cause of the termination of his employment, any information of a proprietary nature belonging to Company, or which could be reasonably expected to have an adverse effect on Company, its businesses, property or financial condition, including but not limited to records, data, documents, processes, specifications, methods of operation, techniques and know-how, plans, policies, customer lists, the names and addresses of suppliers or representatives, investigations or other matters of any kind or description relating to the products, services, suppliers, customers, sales or businesses of Company. All records, files, documents, equipment and the like relating to Company's businesses which Employee shall prepare, use or observe shall be and remain the sole property of Company, and upon termination of this Agreement or his employment hereunder for any reason, Employee shall return to the possession of Company any items of that nature and any copies thereof which he may have in his possession.
		

		
			 
		

		
			8. INDEMNITY.
		

		
			(a) Indemnification. Company will indemnify Employee (and, upon his death, his heirs, executors and administrators) to the fullest extent permitted by law against all expenses, including reasonable attorneys' fees, court and investigative costs, judgments, fines and amounts paid in settlement (collectively, "Expenses") reasonably incurred by him in connection with or arising out of any pending, threatened or completed action, suit or proceeding in which he may become involved by reason of his having been an officer or director of Company or the Bank. The indemnification rights provided for herein are not exclusive and will supplement any rights to indemnification that Employee may have under any applicable bylaw or charter provision of Company or the Bank, or any resolution of Company or the Bank, or any applicable statute.
		

		
			 
		

			
	
			
				 (c)
			

			
	
			
			Advancement of Expenses. In the event that Employee becomes a party, or is threatened to be made a party, to any pending, threatened or completed action, suit or proceeding for which Company or the Bank is permitted or required to indemnify him under this Agreement, any applicable bylaw or charter 

		 

 

	provision of Company or the Bank, any resolution of Company or the Bank, or any applicable statute, Company will, to the fullest extent permitted by law, advance all Expenses incurred by Employee in connection with the investigation, defense, settlement or appeal of any threatened, pending or completed action, suit or proceeding, subject to receipt by Company of a written undertaking from Employee to reimburse Company for all Expenses actually paid by Company to or on behalf of Employee in the event it shall be ultimately determined that Company or the Bank cannot lawfully indemnify Employee for such Expenses, and to assign to Company all rights of Employee to indemnification under any policy of directors, and officers, liability insurance to the extent of the amount of Expenses actually paid by Company to or on behalf of Employee.

		
			 
		

		
			(c) Litigation. Unless precluded by an actual or potential conflict of interest, Company will have the right to recommend counsel to Employee to represent him in connection with any claim covered by this Section 8. Further, Employee's choice of counsel, his decision to contest or settle any such claim, and the terms and amount of the settlement of any such claim will be subject to Company's prior reasonable approval in writing.
		

		
			 
		

		
			9. ARBITRATION. Any disputes arising out of this Agreement or connected with Employee's employment shall be submitted by Employee and Company to arbitration by the American Arbitration Association or its successor, and the determination of the American Arbitration Association or its successor shall be final and absolute. The arbitrator shall be governed by the duly promulgated rules and regulations of the American Arbitration Association or its successor, and the pertinent provisions of the laws of the State of Colorado relating to arbitration. The decision of the arbitrator may be entered as a judgment in any court in the State of Colorado or elsewhere. The prevailing party shall be entitled to receive reasonable attorneys' fees incurred in connection with such arbitration in addition to such other costs and expenses as the arbitrators may award.
		

		
			 
		

		
			10. INTERPRETATION. This Agreement shall be construed in accordance with the internal laws of the State of Colorado. The titles of the paragraphs have been inserted as a matter of convenience of reference only and shall not be construed to control or affect the meaning or construction of this Agreement.
		

		
			11.  SEVERABILITY. In the event that any portion of this Agreement is found to be in violation of or conflict with any federal or state law, the parties agree that said portion shall be modified only to the extent necessary to enable it to comply with such law.
		

		
			 
		

		
			12. ASSIGNMENT. This Agreement shall not be assignable by Employee, but shall be binding upon and inure to the benefit of the successors and assigns of Company.
		

		
			 
		

		
			13. NOTICES. All notices or other communications in connection with this Agreement shall be in writing and shall be deemed to have been duly given when delivered, sent by professional courier or mailed first class, postage prepaid and addressed as follows:
		

		
			(i)  If to Company, addressed to:
		

		
			

		 

 

		

		
			 
		

		
			Colorado Business Bankshares, Inc.
		

		
			821 - I7th Street
		

		
			Denver, Colorado 80202
		

		
			Attn: Steven Bangert
		

		
			 
		

		
			with a copy to:
		

		
			 
		

		
			Holleb & Coff
		

		
			Suite 4100
		

		
			55 E. Monroe
		

		
			Chicago, Illinois 60603
		

		
			Attn: Mark S. Kipnis
		

		
			 
		

		
			(ii) If to Employee, addressed to:
		

		
			 
		

		
			Richard J. Dalton
		

		
			10489 E. Aberdeen Ave.
		

		
			Englewood, CO 80111
		

		
			 
		

		
			with a copy to:
		

		
			__________________
		

		
			__________________
		

		
			__________________
		

		
			
		

		
			or such other address or addressed to the attention of such other person or persons as either of the parties may notify the other in accordance with the provisions of this paragraph.
		

		
			 
		

		
			14. ENTIRE AGREEMENT. This Agreement is the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersedes any and all prior and contemporaneous negotiations, understandings and agreements with regard to the subject matter hereof, whether oral or written. No representation, inducement, agreement, promise or understanding altering, modifying, taking from or adding to the terms and conditions hereof shall have any force or effect unless the same is in writing and validly executed by the parties hereto. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.
		

		
			 
		

		
			Colorado Business Bankshares, Inc.
		

		
			 
		

			
					
						 

					
					
						 

				
	
					
						/s/ Richard J. Dalton

					
					
						By: /s/ Steven Bangert

				
	
					
						     Richard J. Dalton

					
					
						       Steven Bangert

				
	
					
						 

					
					
						       Chief Executive Officer

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