Amended and Restated Employment Agreement with Susan Just, dated February 1, 2024
Exhibit 10.10
[***] Certain identified information has been excluded from the exhibit pursuant to Regulation S-K Item 601(b)(10)(iv) because it is both (i) not material and (ii) is the type that the Company customarily treats as private or confidential.
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (the “Agreement”) is entered into by and between HERITAGE COMMERCE CORP, a California bank holding company (the “Company”), HERITAGE BANK OF COMMERCE, a California banking corporation (the “Bank”), and SUSAN JUST, an individual (the “Executive”) as of February 1, 2024 (the “Effective Date”). This Agreement amends and restates that certain employment agreement by and between the Company, the Bank and the Executive, dated September 7, 2023 (the “Original Agreement”) and supersedes any previous employment agreements or other arrangements or understandings between the parties regarding Executive’s employment.
RECITALS
WHEREAS, the Company is a California corporation and a bank holding Company registered under the Bank Holding Company Act of 1956, as amended, subject to the supervision and regulation of the Board of Governors of the Federal Reserve System;
WHEREAS, the Company is the parent holding company for the Bank, which is a California banking association, subject to the supervision and regulation of the California Department of Financial Protection and Innovation and the Federal Reserve Board;
WHEREAS, the Boards of Directors of the Company and the Bank have approved and authorized the entry into this Agreement with the Executive; and
WHEREAS, the parties desire to enter into this Agreement to set forth the terms and conditions for the employment relationship of the Executive with the Company and the Bank.
AGREEMENT
NOW, THEREFORE, in consideration of the promises and mutual covenants and agreements herein contained and intending to be legally bound hereby, the Company, the Bank and the Executive hereby agree as follows:
(a) Executive Officer Cash Incentive Program. The Executive shall qualify for an annual incentive compensation payment pursuant to the terms of the Company’s Executive Officer Cash Incentive
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Program in effect at the date of this Agreement, and as amended at any future date or pursuant to any successor incentive program or arrangement adopted by the Company or the Bank for its officers (the “Incentive Program”). Notwithstanding any contrary terms of the Incentive Program, an annual payment if earned under the Incentive Program for a fiscal year shall be paid to the Executive no later than the 15th day of the third month following the end of the calendar year in which the annual incentive compensation payment is no longer subject to a substantial risk of forfeiture, provided that the Executive must still be an active employee with the Company on the date the incentive compensation payment is made by the Company to earn and receive the incentive compensation payment. If the Executive is not actively employed on the date the incentive compensation payment is made by the Company, Executive has not earned, and is not entitled to, such payment.
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Notwithstanding the foregoing or any other provision of this Agreement, if any part or all of the severance benefits is subject to taxation under Section 409A of the Code, as determined by the Bank, with the advice of its independent accounting firm or other tax advisors, then the severance benefits
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shall be subject to modification as set forth in Section 7 of this Agreement.
Notwithstanding the foregoing, when the Executive is entitled to the severance benefits provided in Section 6.2(b), then Executive shall not be entitled to the severance benefits pursuant to this Section 6.2(a).
The Executive acknowledges and agrees that severance benefits pursuant to this Section 6.2(a) are in lieu of all damages, payments and liabilities on account of the early termination of this Agreement and are the sole and exclusive remedy for the Executive for a termination specified in Section 6.l(d).
Notwithstanding the foregoing or any other provision of this Agreement, if any part or all of the severance benefits is subject to taxation under Section 409A of the Code, as determined by the Bank, with the advice of its independent accounting firm or other tax advisors, then the severance payment shall be subject to modification as set forth hereafter in Section 7 of this Agreement.
The Executive acknowledges and agrees that severance benefits pursuant to this Section 6.2(b) are in lieu of all damages, payments and liabilities on account of the events described above for which such severance benefits may be due the Executive under Section 6.2(b) of this Agreement. This Section 6.2(b) shall be binding upon and inure to the benefit of the Bank and the Company and their
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respective successors and assigns.
Notwithstanding the foregoing, the Executive shall not be entitled to receive severance benefits pursuant to this Section 6.2(b) in the event the Executive’s termination of employment results from an occurrence described in Section 6.1(a), Section 6.1(b) or Section 6.1(c).
Notwithstanding any other term or provision of this Agreement, to the extent that any provision of this Agreement is determined by the Bank or the Company, with the advice of its independent accounting firm or other tax advisors, to be subject to and not in compliance with Section 409A, including, without limitation, the definition of Change of Control or the timing of commencement and completion of severance benefits and/or other benefit payments to the Executive hereunder, or the amount of any such payments, such provisions shall be interpreted in the manner required to exempt the benefit from or to comply with Section 409A. The Company, the Bank and the Executive acknowledge and agree that such interpretation
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could, among other matters, (i) limit the circumstances or events that constitute a “change in control;” (ii) delay for a period of 6 months or more, or otherwise modify the commencement of severance and/or other benefit payments; (iii) modify the completion date of severance and/or (iv) other benefit payments and/or reduce the amount of the benefit otherwise provided.
The Company, Bank and the Executive further acknowledge and agree that if, in the judgment of the Bank or the Company, with the advice of its independent accounting firm or other tax advisors, amendment of this Agreement is necessary to exempt the benefits from or to comply with Section 409A, the Bank, the Company and the Executive will negotiate reasonably and in good faith to amend the terms of this Agreement to the extent necessary so that it exempts the benefits from or to comply with Section 409A (with the most limited possible economic effect on the Bank, the Company and the Executive). For example, if this Agreement is subject to Section 409A and Section 409A requires that severance and/or other benefit payments must be delayed until at least 6 months after the Executive terminates employment, then the Bank, the Company and the Executive shall delay payments and/or promptly seek a written amendment to this Agreement that would, if permissible under Section 409A, eliminate any such payments otherwise payable during the first 6 months following the Executive’s termination of employment and substitute therefore a lump sum payment or an initial installment payment, as applicable, at the beginning of the 7th month following the Executive’s termination of employment which, in the case of an initial installment payment, would be equal in the aggregate to the amount of all such payments thus eliminated. Notwithstanding the foregoing, (a) the Executive and the Executive’s dependents shall not be denied access to and participation in any health or medical insurance coverage and benefits, for any period of time the Executive and the Executive’s dependents are otherwise eligible, and (b) the Executive acknowledges and agrees that the Company or the Bank shall have the exclusive authority to determine whether the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i).
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The term “Proprietary Information” shall also be given its broadest possible interpretation and shall mean any and all information disclosed or made available by the Company or the Bank to the Executive including, without limitation, any information upon which the Company’s or the Bank’s business or success depends, and including any and all information constituting, incorporating, referencing or derived from the financial, personal or business information of the Bank’s customers.
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Company: | HERITAGE COMMERCE CORP |
Bank: | HERITAGE BANK OF COMMERCE |
Executive: | Susan Just |
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San Jose, CA 95110
[***]
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[Signature Page Follows]
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IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement on the date first indicated above.
“COMPANY”
HERITAGE COMMERCE CORP,
a California bank holding company
By: /s/ Robertson Clay Jones
Name: Robertson Clay Jones
Title: Chief Executive Officer
Chief Executive Officer
“BANK”
HERITAGE BANK OF COMMERCE,
a California banking corporation
By: /s/ Robertson Clay Jones
Name: Robertson Clay Jones
Title: Chief Executive Officer
Chief Executive Officer
“EXECUTIVE”
By: /s/ Susan Just
Susan Just
[Signature Page to Employment Agreement – Susan Just]
EXHIBIT A
RELEASE AGREEMENT
This Release Agreement (the “Release Agreement”) is entered into by and between ______________________ (“Employee”), on the one hand, and HERITAGE BANK OF COMMERCE, a California banking corporation (the “Bank”) and HERITAGE COMMERCE CORP., a California bank holding company (the “Company”), on the other hand.
RECITALS
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants herein contained, and for other good and valuable consideration, the adequacy of which is hereby acknowledged, the parties, intending to be legally bound, agree and covenant as follows:
In consideration for the payments and benefits specified in Section 6.2(a) or Section 6.2(b), as applicable of the Employment Agreement, Employee agrees to unconditionally, irrevocably, and forever fully release, waive, and discharge the Bank and the Company, and each and all of their past, present, and future parent companies, subsidiaries, related entities, affiliates, predecessors, successors, assigns, officers, directors, managers, employees, members, shareholders, owners, representatives, attorneys, insurers, reinsurers, and agents (and the past, present, and future officers, directors, managers, employees, members, shareholders, owners, representatives, attorneys, insurers, reinsurers, and agents of any such parent companies, subsidiaries, related entities, affiliates, predecessors, successors, and assigns) (collectively the “Released Parties”) from and against any and all claims, actions, causes of action, suits, demands, contracts, agreements, obligations, losses, compensation, wages, penalties, liabilities, rights, and damages of any kind or nature whatsoever, whether known or unknown, foreseen or unforeseen, which Employee ever had, now has or may claim to have against any or all of the Released Parties for, upon or by reason of any fact, matter, injury, incident, circumstance, cause or thing whatsoever, from the beginning of time up to and including the date of Employee’s execution of this Release Agreement, including, without limitation, any claim or obligation arising from or in any way related to Employee’s employment with the Bank or the Company, the termination of that employment, or an alleged breach of the Employment Agreement.
This General Release specifically includes, but is not limited to, any claim for discrimination or violation of any statutes, rules, regulations or ordinances, whether federal, state or local, including, but not limited to, Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, the Reconstruction Era Civil Rights Act, the California Fair Employment and Housing Act, the California Labor Code, the California Business and Professions Code, the California constitution, and any claims at common law.
Employee further knowingly and willingly agrees to waive the provisions and protections of Section 1542 of the California Civil Code, which reads:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO
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EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, AND THAT IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
This General Release covers not only any and all claims by Employee against the Bank and the Company, and the other persons and entities released in this General Release, but, to the extent permitted by applicable law, it also covers any claim for damages or reinstatement asserted on Employee’s behalf by any other person or entity, including, without limitation, any government agency, and Employee expressly waives the right to any such damages or reinstatement. This General Release does not include any claims that cannot lawfully be waived or released by Employee.
Employee and the Bank and the Company further acknowledge and agree that the payments and benefits specified in Section 6.2(a) or Section 6.2(b), as applicable of the Agreement will not be made, the Release Agreement will become null and void, unless and until each of the following four conditions are satisfied: (a) Employee executes the Release Agreement within twenty-one (21) days after receiving it, (b) Employee returns the executed Release Agreement to the Bank no later than five (5) working days after executing it, (c) the Release Agreement by its terms becomes effective and enforceable after the seven (7) day revocation period specified in the preceding paragraph has expired without revocation by Employee, and (d) Employee returns all materials (pursuant to Section 12 of the Employment Agreement) to the Bank no later than five (5) days after the Termination Date.
Employee represents and agrees that, prior to Employee’s execution of this Release Agreement, Employee has been informed by the Bank and the Company of Employee’s right to consult with legal counsel regarding the terms of this Release Agreement during the 21 day review period in Paragraph B above, that Employee has had the opportunity to discuss the terms of this Release Agreement with legal counsel of Employee’s choosing, and that the Bank and the Company by this writing is encouraging Employee to seek this advice of legal counsel.
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The undersigned agree to the terms of this Release Agreement and voluntarily enter into it with the intent to be bound hereby.
EMPLOYEE | | HERITAGE COMMERCE CORP. |
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[Signature Page to Release Agreement]