Document:

Prepared by MERRILL CORPORATION

Exhibit 10.21

 

SEVERANCE PAY AGREEMENT

 

1.     Employer:

     PACIFIC NORTHWEST BANK (the “Bank”)

 

2.     Executive:     BETTE

J. FLORAY

 

3.     Duties:  The Bank hereby agrees to continue the

employment of Executive as an officer of Pacific Northwest Bank with such

duties and responsibilities as may be determined from time to time by the Board

of Directors and by the President of the Bank, subject to the terms hereof.

 

4.     Successors:  This Agreement shall inure to the benefit of

and be binding upon the Bank and its successors and assigns.

 

5.     Severance

Pay:  Except as provided in

Paragraph 8 below, if the Bank or successor terminates Executive, Executive

shall be entitled to receive Severance Pay as follows:

 

5.1.    Executive

shall be entitled to a minimum of an amount equal to six (6) months Total

Compensation; and

 

5.2.    After

four (4) years employment, in addition to the six (6) months Total

Compensation, Executive shall be entitled to an amount equal to an additional

one (1) month Total Compensation for each additional twelve (12) months of

employment by Executive with the Bank and/or its successors; provided, however,

 

5.3.    The

total Severance Pay compensation shall not exceed an amount equal to twelve

(12) months Total Compensation.

 

6.     Change

of Control.

 

6.1.    In

the event of a Change of Control during the term of Employment, Executive will

be entitled to Severance Pay in an amount equal to twelve (12) months Total

Compensation; provided, however, Executive shall not be eligible for

Severance Pay if Executive is not terminated by such successor entity within

one (1) year following such Change of Control and Executive is offered

substantially equivalent employment by a successor entity that:

 

(a)    Includes

comparable salary and benefits;

 

(b)    Includes a

position with duties and responsibilities commensurate with those customarily

performed by a person with the status of Executive Vice President in the

finance area; and

 

(c)    Does not

require Executive to relocate beyond a reasonable commuting distance, which

distance may, but need not be, established by the Bank as a matter of policy.

 

6.2.    For

the purposes of this Agreement, the term “Change of Control” shall mean the

acquisition of Pacific Northwest Bank, or a substantial part thereof, by

another company; the merger of Pacific Northwest Bank into another company with

the other company surviving; the sale of substantially all of the assets of

Pacific Northwest Bank to another company; or a hostile acquisition of

substantially all of the stock of Pacific Northwest Bank.  For purposes of Change of Control, the term

“Pacific Northwest Bank” includes Pacific Northwest Bank and its holding

company, Pacific Northwest Bancorp.

 

7.     Other

Benefits:  The Severance Pay

compensation provided herein shall be in addition to other benefits to which

Executive may otherwise be entitled.

 

8.     Termination.  Executive shall not be entitled to Severance

Pay if her Employment is terminated for any of the following reasons:

 

8.1.    Voluntary

election by Executive to terminate her employment with the Bank.

 

8.2.    Termination

by the Bank for gross misconduct, which includes, but is not limited to chronic

alcoholism or controlled substance abuse, as determined by a doctor mutually

acceptable to the Bank and Executive, and continuing failure by Executive to

commence and pursue with due diligence appropriate treatment for same in

accordance with such doctor’s recommendations; dishonesty; insubordination or

willful failure to discharge assigned duties; harassment of fellow employees or

customers of the Bank; violation of the conflict of interest policy of the Bank

or its subsidiaries; theft; possession of unauthorized weapons or firearms

(loaded or unloaded) on the premises of the Bank or its subsidiaries; or

conviction of a criminal offense constituting a felony.

 

8.3.    Death of

Executive.

 

8.4.    Physical or

mental illness or incapacity which renders Executive unable (with reasonable

accommodation) to perform substantially all of the duties and services required

of her under this agreement for a period of sixty (60) days in the aggregate

during any twelve-month period.

 

9.     Definitions.  For purposes of this Agreement, the term

“Total Compensation” shall mean an amount equal to Executive’s W-2 income

before salary deferrals over the twelve (12) months preceding the month of

termination, divided by twelve (12).

 

	

  PACIFIC

  NORTHWEST BANK

  	

   

  	

  EXECUTIVE

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

  By: 

  	

  /s/  Patrick M. Fahey

  	

   

  	

  By: 

  	

  /s/  Bette J. Floray

  
	

   

  	

  Patrick M. Fahey, President/CEO

  	

   

  	

   

  	

  Bette J. Floray, Executive Vice

  
	

   

  	

   

  	

   

  	

   

  	

  President/Chief Financial OfficerPrepared by MERRILL CORPORATION

Exhibit 10.22

 

CHANGE IN CONTROL

AGREEMENT

 

This Change in

Control Agreement is made this 1st day of July, 2000, by and between PACIFIC

NORTHWEST BANCORP and PACIFIC NORTHWEST BANK (hereinafter jointly referred to

as the “Bank”) and BETTE J. FLORAY (hereinafter referred to as the

“Executive”), who agree as follows:

 

1.    Pacific Northwest Bank.  Pacific Northwest Bank is a wholly-owned

subsidiary of Pacific Northwest Bancorp, a Washington corporation.

 

2.    Purpose.  The purpose of this Agreement is to provide

certain assurances to Executive that in the event of a Change in Control or a

substantial change in ownership of the Bank, Executive shall either have

continued employment or, in the event of termination, severance pay.  The Bank is willing to make such assurances

to Executive to encourage Executive to maintain continued employment with the

Bank.

 

3.    Definition.  “Change in Control” as provided herein shall

include the following:

 

(a)  Merger of the Bank into

another financial institution or entity, with such other entity being the

surviving entity;

 

(b)  Acquisition of the Bank by another

institution or entity;

 

(c)  Sale of all or substantially all of the

assets of the Bank;

 

(d)  The acquisition of 25 percent or more of the

beneficial ownership of stock of the Bank by one or more related entities or

persons, except a Bank-approved ESOP; and

 

(e)  If during any period of two (2) years,

individuals who at the beginning of such period constitute the Board of

Directors of the Bank (the “Continuing Directors”) cease for any reason to

constitute at least a majority of the Board of Directors of the Bank unless the

election of each Director who is not a Continuing Director was approved by a

vote of at least two-thirds (2/3) of the Continuing Directors in office at the

time of the election of each such new Director.

 

Any one of the foregoing items may constitute a Change in Control

activating Executive’s Employment Contract and Severance Pay provisions set

forth below.  To prevent an

unanticipated activation of the Employment Contract and/or Severance Pay

provisions, either Executive or the Bank must give written notice to the other

of the Change in Control thereby activating the Employment Contract and

Severance Pay provisions set forth below.

 

4.   

Upon a Change in Control, Executive shall be entitled to receive a

four-year employment contract (“Employment Contract”) with the successor entity

that provides:

 

(a)  Executive a position with duties and

responsibilities commensurate with those customarily performed by a person with

the status of Executive Vice President in the finance area;

 

(b)  That Executive’s services shall be performed

in the same geographical location where Executive is employed at the time of

the Change in Control;

 

(c)  That Executive’s salary and benefits are

comparable to those received by Executive over the twelve (12) months prior to

the Change in Control;

 

(d)  That the successor entity may terminate

Executive’s employment at any time prior to the expiration of the four-year

contract term by paying Executive an amount equal to the Total Compensation

paid to Executive for the prior two calendar years.  For purposes of this Agreement, “Total Compensation” shall be

defined as an amount equal to Executive’s W-2 income before salary deferrals.

 

(e)  Notwithstanding the foregoing, the successor

entity may provide in the Employment Contract that Executive may be terminated

for chronic alcoholism or controlled substance abuse, as determined by a doctor

mutually acceptable to the Bank and Executive, and continuing failure by

Executive to commence and pursue with due diligence appropriate treatment for

same in accordance with such doctor’s recommendations; dishonesty;

insubordination or willful failure to discharge assigned duties; harassment of

fellow employees or customers of the Bank; violation of the conflict of

interest policy of the Bank or its subsidiaries; theft; possession of

unauthorized weapons or firearms (loaded or unloaded) on the premises of the

Bank or its subsidiaries; or conviction of a criminal offense constituting a

felony.  If Executive is terminated

under this provision, Executive shall not be entitled to receive any payments

under this Agreement.

 

5.    Executive Termination

Window.  If Executive is employed by

the successor entity following a Change in Control in accordance with Section

4, above, during the period commencing with the 25th month following

a Change in Control through the 30th month following a Change in

Control, Executive may terminate her Employment Agreement by delivering written

notice to the successor entity.  If

Executive does so regardless of whether Executive had good reason to terminate

this Agreement, the successor entity will pay Executive a single cash payment

in an amount equal to Executive’s Total Compensation for the prior twelve (12)

months period.  If Executive elects to

terminate her employment under this paragraph, her termination of employment

shall be deemed voluntary and Executive shall not therefore be entitled to any

additional benefit under the Severance Pay Agreement.

 

6.    Other Benefits.  Payments under this Agreement shall be in

addition to any payments to which Executive may be entitled to receive under

the terms of a separate Severance Pay Agreement.

 

	

  PACIFIC

  NORTHWEST BANK

  	

   

  	

  EXECUTIVE

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

  By: 

  	

  /s/  Patrick M. Fahey

  	

   

  	

  By: 

  	

  /s/  Bette J. Floray

  
	

   

  	

  Patrick M.

  Fahey, President/CEO

  	

   

  	

   

  	

  Bette J.

  Floray, Executive Vice

  
	

   

  	

   

  	

   

  	

   

  	

  President/Chief

  Financial Officer

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