Document:

Exhibit 10.2

 

AMENDED AND RESTATED SEVERANCE AGREEMENT

 

THIS AMENDED AND RESTATED SEVERANCE AGREEMENT (this “Agreement”) is made and entered into as of May 3, 2005,
by and between National Mercantile Bancorp, a California corporation (the “Company”), and Robert W. Bartlett (“Officer”)
with reference to the following facts:

 

A.            Officer
is an officer of the Company and/or one or more subsidiaries of the Company;
and

 

B.            In
order to induce Officer to remain employed by the Company and/or its
subsidiaries, the Company is willing to agree to pay severance to Officer under
certain circumstances.

 

C.            This
Agreement amends and restates in its entirety the Severance Agreement dated September 26,
2003 by and between the Company and Officer.

 

NOW, THEREFORE, in consideration of the foregoing and
of the respective covenants and agreements of the parties herein contained, it
is agreed as follows:

 

1.             Definitions.  For purposes of this Agreement, the following
terms when used in this Agreement shall have the meanings set forth below:

 

1.1           “Board” shall mean the Board of Directors of the Company.

 

1.2           “Cause” shall mean Officer, after the date
of this Agreement, (i) has been convicted by a court of competent
jurisdiction of any felony or any criminal offense involving dishonesty, breach
of trust or misappropriation, or has entered a plea of nolo  contendere
to such an offense; or (ii) has committed an act of fraud, embezzlement,
theft, dishonesty or any act which would cause termination of coverage under
the Company’s Banker’s Blanket Bond as to Officer (as distinguished from
termination of coverage as to the Company as a whole); or (iii) has
committed a willful violation of the Code of Conduct of any member of the
Company Group or any law, rule or regulation governing the operation of
the Company Group which the Board determines in good faith will likely have or
has had a material adverse effect on the business, interests or reputation of
the Company Group or any Member thereof; or (iv) has willfully refused to
perform the duties assigned to him; or (v) has committed a willful and
unauthorized disclosure of material confidential information regarding the
Company Group, which disclosure the Board determines in good faith will likely
have or has had a material adverse effect on the Company Group or any member
thereof.

 

1.3           “Change of Control” shall mean any
transaction or series of related transactions as a result of which:

 

(i)            the
Company consummates a reorganization, merger or consolidation, or sale or other
disposition of all or substantially all of its assets (each a

 

 

“Business Combination”), in each case unless
immediately following the consummation of such Business Combination all of the
following conditions are satisfied:

 

(A)  Persons, who, immediately prior to such Business
Combination, were the beneficial owners of the Outstanding Voting Securities of
the Company, beneficially own (within the meaning of Rule 13d-3
promulgated under the Exchange Act, directly or indirectly, more than 50% of
the combined voting power of the then Outstanding Voting Securities of the
entity (the “Resulting Entity”) resulting from
such Business Combination (including, without limitation, an entity which as a
result of such transaction owns the Company or all or substantially all of the
Company’s assets either directly or through one or more subsidiaries);

 

(B)  no Person, other than the Existing
Shareholder Group, beneficially owns (within the meaning of Rule l3d-3),
directly or indirectly, more than: (i) 20% of the then outstanding
combined voting power of the Outstanding Voting Securities of the Resulting
Entity, except to the extent that such Person’s beneficial ownership of the
Company immediately prior to the Business Combination exceeded such threshold,
and (ii) beneficially owns more the Existing Shareholder Group;

 

(C)  at least one-half of the members of the
board of directors of the Resulting Entity were members of the Board at the
time the Board authorized the Company to enter into the definitive agreement
providing for such Business Combination; or

 

(ii)           any
Person acquires beneficial ownership (within the meaning of Rule 13d-3)
of more than 20% of the combined voting power (calculated as provided in Rule l3d-3
in the case of rights to acquire securities) of the then Outstanding Voting
Securities of the Company and has greater beneficial ownership than the
Existing Shareholder Group; provided, however, that for purposes
of this clause, the following acquisitions shall not constitute a Change of
Control:  (x) any acquisition
directly from the Company, (y) any acquisition by the Company,
(z) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any entity controlled by the Company;
or (zz) any acquisition by the Existing Shareholder Group.

 

1.4           “Company Group” shall mean at any time the Company and each
subsidiary of the Company at such time which is consolidated with the Company
for financial reporting purposes.

 

1.5           “Disability of Officer” shall mean if
Officer is Disabled and such disability continues for a period of any
six months out of a one-year period. 
“Disabled” shall mean
Officer’s inability, through physical or mental illness or other cause, to
perform normal and customary duties which Officer is required to perform for
the Company.  In determining whether
Officer is Disabled, the Company may rely upon the written statement provided
by a licensed physician acceptable to the Company.  Officer shall allow examination from time to
time by any licensed physician selected by the Company and agreed to by
Officer.  All such examinations will be
conducted within a reasonable time period.

 

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1.6           “Exchange Act” shall mean the Securities Exchange Act of
1934, as amended, or any successor statute.

 

1.7           “Existing Shareholder Group” shall mean Carl R. Pohlad,
members of the immediate family of Carl R. Pohlad, and any affiliated Person of
Carl R. Pohlad or any member of his immediate family.

 

1.8           “Outstanding Voting Securities” of any Person means the
outstanding securities of such Person entitling the holders thereof to vote
generally in the election of directors of such Person.

 

1.9           “Person” shall have the meaning ascribed to
such term in Section 3(a)(9) of the Exchange Act, which definition shall
include a “person” within the meaning of Section 13(d)(3) of the
Exchange Act.

 

1.10         “Without Cause” shall mean any termination
of Officer’s employment by the Company except for a termination (i) for
Cause, (ii) as a result of the death of Officer, or (iii) as a result
of the Disability of Officer.

 

2.             Severance Payment.

 

2.1           Except
as provided in Section 2.2, if within one year following a Change of
Control, either Officer terminates employment with all members of the Company
Group voluntarily or the Company terminates Officer’s employment Without Cause,
the Company will pay Officer in a lump sum (except as provided below) an amount
(the “Severance Payment”) equal to
the sum of: (i) fifteen times Officer’s base monthly salary as in effect
at the time of termination or, if greater, immediately prior to the effective
date of the Change of Control; and (ii) twice the amount of the bonus, if
any, paid (or payable) to Officer for the fiscal year immediately preceding the
fiscal year in which Officer’s employment terminates. The Severance Payment
shall be reduced by required deductions for applicable taxes and other
withholdings and for any outstanding obligations owed by Officer to the Company
that are then due and payable, which deductions and withholdings are
specifically authorized by Officer.  The
Severance Payment shall be in lieu of any other severance payments to which
Officer would be entitled under the plans or policies of the Company and any of
its subsidiaries.  If Officer’s
employment is terminated by the Company Without Cause, the Severance Payment
shall be paid at the time of termination of the Officer’s employment with the
Company.  If Officer’s employment is
terminated voluntarily by Officer, the Severance Payment shall be paid within
30 days following termination. 
Notwithstanding the foregoing, if as of the date the Severance Payment
is due Officer’s bonus for the preceding fiscal year has not been determined,
the Company shall defer payment of the bonus component of the Severance Payment
until such time as Officer’s bonus shall have been determined, but in no event
later than 90 days following the end of such preceding fiscal year.  Each Change of Control shall give Officer a
separate right to give the notice set forth in the first sentence of this Section 2;
provided that in no event shall Officer be entitled to more than one Severance
Payment.

 

3

 

2.2           Notwithstanding
any other provision of this Agreement, the Company shall have no obligation to
make the Severance Payment if such Severance Payment is prohibited by
applicable federal or state law, including without limitation Part 359 of
the regulations of the Federal Deposit Insurance Corporation (12 CFR § 359
et seq.) or any successor
provision.

 

2.3           As
a condition to the obligation of the Company to pay the Severance Payment, the
Officer must execute and deliver a release in form and substance satisfactory
to the Company releasing the Company Group and its directors, officers,
employees and agents (“Released Parties”)
from any and all claims the Officer may have against the Released Parties,
whether such claims are known or unknown, absolute or contingent, other than
claims under this Agreement, claims for salary and other compensation and
benefits accrued prior to termination, claims for indemnification under
applicable law, the Bylaws of the Company or any Indemnification Agreement
between the Officer and the Company, and rights of Officer under employee
benefit plans.

 

3.             IRC Provisions.  Notwithstanding any other provision of this
Agreement, if the Company reasonably determines that the payment of the
Severance Payment to Officer would be nondeductible by the Company for federal
income tax purposes because of Section 280G of the Internal Revenue Code
of 1986, as amended (the “Code”),
the Severance Payment shall be reduced to an amount which maximizes the
Severance Payment without causing any portion of the same to be nondeductible
by the Company because of Section 280G of the Code.  Any such reduction shall be applied to the
Severance Payment or the other amounts due to Officer in such manner as Officer
may reasonably specify within 30 days following notice from the Company of the
need for such reduction or, if Officer fails to so specify timely, as
determined by the Company.

 

4.             Employee Benefits.  All employee benefits provided by the Company
shall cease upon termination of Officer’s employment for any reason, and the
Company shall have no further responsibility with respect thereto after such
termination; provided, however, that: (a) nothing contained
in this Agreement shall affect any right Officer may have pursuant to the
federal entitlement to continued group health care coverage as provided in the
Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) or any successor legislation or
comparable state law; (b) if Officer is entitled to receive a Severance
Payment pursuant to Section 2 hereof, and if Officer elects under COBRA to
continue to receive any benefits thereunder, the Company shall reimburse
Officer for the amount of such Officer’s COBRA payments for the first fifteen
months after such termination; and (c) nothing shall alter or modify the
post termination rights of Officer under any employee benefit plan (such as the
right to exercise vested options for a specified period under the Stock
Incentive Plan).

 

5.             Term.  The Agreement shall commence on the date set
forth above and shall terminate upon 12 months prior written notice to the
Officer.

 

6.             Employment “At Will”.  Neither this Agreement nor the Severance
Payment payable hereunder shall be deemed to limit, replace or otherwise affect
the “at will” nature of Officer’s employment with the Company Group.  Officer’s employment with any member of the
Company Group continues to be for an unspecified term and may be terminated at
will at

 

4

 

any time with or
without cause or notice by such member of the Company Group or by Officer (but
in the case of Officer, without the written consent of the Company Officer must
terminate his employment with all members of the Company Group).  This employment “at-will” relationship cannot
be changed absent an express intent as set forth in an individualized written
employment contract signed by both Officer and the Chief Executive Officer of
the Company.

 

7.             Mitigation.  Officer shall have no obligation to mitigate
damages based upon Officer’s termination pursuant to Section 2 of this
Agreement, and the Severance Payment shall not be reduced as a result of
Officer obtaining other employment within fifteen months of Officer’s
termination.

 

8.             Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, and all of which,
together, shall constitute one and the same instrument.

 

9.             Partial Invalidity.  Any provision of this Agreement which shall
prove to be invalid, void or illegal shall in no way affect, impair or
invalidate any other provision hereof, and such other provisions shall remain
in full force and effect.

 

10.           Governing Law.  The terms and provisions of this Agreement
shall be governed and construed pursuant to the laws of the State of California
except to the extent governed by federal law.

 

11.           Construction.  Headings at the beginning of each section are
solely for the convenience of the parties and are not a part of this
Agreement.  Whenever required by the
context of this Agreement, the singular shall include the plural and the
masculine shall include the feminine and vice versa.  This Agreement shall not be construed as if
it had been prepared by one of the parties, but rather as if both parties had
prepared the same.  Unless otherwise
indicated, all references to sections are to this Agreement.

 

12.           Integration.  This Agreement represents the entire and
integrated agreement between the Company and Officer regarding the subject
matter hereof and supersedes all prior negotiations, representations or
agreements, either written or oral.

 

13.           Successors and Assigns.  The terms, covenants and conditions herein
contained shall be binding upon and shall inure to the benefit of the heirs,
successors and assigns of the parties hereto.

 

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14.           No Waiver.  No waiver by either party of any breach or
default hereunder shall be deemed a waiver of any other breach or default, and
no delay or forbearance by either party hereunder in enforcing any of its
rights or remedies shall be deemed a waiver of any such rights or remedies,
unless such waiver is embodied in a writing signed by the authorized
representative of the party to be bound.

 

IN WITNESS WHEREOF, this Agreement has been executed
effective on the day and year hereinabove set forth.

 

 

	
  THE “COMPANY”

  	
  NATIONAL MERCANTILE BANCORP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott A.
  Montgomery

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  Scott A. Montgomery, President/CEO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  “OFFICER”

  	
  /s/ Robert W. Bartlett

  	
   

  
	
   

  	
  Robert W.
  Bartlett

  
					

 

6Exhibit 10.1

 

March 1, 2005

 

Mr. Edward J. Reilly

Federal Insurance Company

15 Mountain View Road

P. O. Box 1615

Warren, NJ  07061-1615

 

Mr. J. Michael Pete

Arch Insurance Company

3 Parkway, Suite 1500

Philadelphia, PA  19102

 

Re:    Intercreditor Agreement dated
as of October 23, 2003, as amended by the First Amendment to Intercreditor Agreement dated as of March 1, 2005 (as so
amended and as amended from time to time after the date hereof, the “Intercreditor Agreement”)

 

Dear Sirs:

 

This letter memorializes the acknowledgement of the undersigned, Bank
of Texas NA, individually as a Lender and in its capacity as Administrative
Agent (in such capacity, the “Lender Agent”) for and on behalf of the
other Lenders under the terms of that certain Amended and Restated Credit
Agreement dated as of December 31, 2003 (as amended from time to time, the “Credit
Agreement”), that under the Credit Agreement, at the end of any fiscal
quarter, the aggregate amount of the surety facility with the addressees of
this letter may equal the greater of (a) $145,000,000 and (b) the lesser of (i) Two Hundred Seventy-Five Million Dollars ($275,000,000)
and (ii) the amount which causes the Bonded Contract Ratio (as such term is
defined in the Credit Agreement) at the end of such fiscal quarter to exceed 35
percent.  For purposes of determining the
Bonded Contract Ratio, you may rely upon the most recent certificate of a
financial officer of Comfort Systems USA, Inc. to the Lender Agent setting
forth such Bonded Contract Ratio.  In all
capacities established and/or described in the Credit Agreement, as amended,
the undersigned will comply with all requirements and perform any and all of
the responsibilities of the Lender Agent as set out in the Intercreditor
Agreement.

 

[The remainder of this page has been left
blank intentionally.]

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  BANK OF TEXAS NA

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Edward H. Braddock

  	
   

  
	
   

  	
  Name:

  	
  Edward H. Braddock

  
	
   

  	
  Its:

  	
  Vice President

  
					

 

ACKNOWLEDGED BY:

 

	
  FEDERAL INSURANCE COMPANY

  
	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Edward J. Reilly

  	
   

  
	
  Name: Edward J. Reilly

  	
   

  
	
  Title:
  Assistant Secretary

  	
   

  
			

 

 

	
  ARCH INSURANCE COMPANY

  
	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ J. Michael Pete

  	
   

  
	
  Name: J. Michael Pete

  	
   

  
	
  Title: Asst. Vice President

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