Ceo Employment Agreement

Exhibit 10.3


EMPLOYMENT AGREEMENT
--------------------


THIS EMPLOYMENT AGREEMENT ("Agreement"), is made and entered into as of
--------- the 27/th/ day of August, 2001, by and between CARDINAL FINANCIAL CORPORATION, a
------ ------ Virginia corporation with its principal offices at 10555 Main Street, Fairfax, Virginia 22030 ("Company"), and THOMAS C. KANE ("Kane"), an individual residing
------- at 9940 Hampton Road, Fairfax Station, Virginia 22039. This Agreement supersedes and replaces the earlier Agreement dated October 13, 1998.


WITNESSETH:


WHEREAS, the Company is a multi-bank holding company; and


WHEREAS, the Company has organized and chartered an investment institution to provide financial and brokerage services throughout the Northern Virginia region ("Subsidiary"); and
----------


WHEREAS, Kane has been retained to provide services in an executive capacity for the Company and the Subsidiary, and the parties desire to memorialize the terms and conditions of Kane's continuing employment;


NOW, THEREFORE, in consideration of the promises and obligations of the Company and Kane under this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:


ARTICLE 1


SCOPE OF EMPLOYMENT


1.1. Title. Kane has been employed as Senior Vice President of the
----- Company and President and Chief Executive Officer of the Subsidiary since October 13, 1998. For the term of this Agreement, he will continue in these capacities.


1.2. Duties and Responsibilities. As Senior Vice President of the
--------------------------- Company, Kane shall perform such duties as may be assigned to him by the Company consistent with that position.


As President and Chief Executive Officer of the Subsidiary, Kane will be responsible for the supervision of all of the Subsidiary operations, the development of recommendations to the board of directors of the Subsidiary ("Subsidiary Board") of plans and policies for the Subsidiary, and shall serve ---------------- on professional or civic organizations to promote the interests of the Subsidiary if so directed by the Subsidiary Board. Kane is also required to perform such other duties consistent with his position as the Subsidiary Board may direct from time to time.


During the term of his employment, Kane is required to devote his full time, attention, and efforts, with undivided loyalty, to the business of the Company and the Subsidiary and shall use his best effort to promote their interests.


Kane's principal office shall be at a location within the Metropolitan Washington Area determined by the President and Chief Executive Officer ("CEO") of the Company.


1.3. Failure to Maintain Regulatory Approval. If the applicable
--------------------------------------- regulatory Authorities revoke the necessary approvals for Kane to serve as President and Chief Executive Officer of the Subsidiary or otherwise substantially limit the operating authority of the Subsidiary or the scope of duties he may perform in that capacity, this Agreement shall terminate automatically and be of no further legal force or effect.


1.4. Other Affairs. Notwithstanding anything in this Agreement to the
------------- contrary, Kane may engage in charitable and community affairs and manage his personal investments, provided that such activities do not create a conflict of interest, are not inconsistent with the interests and purposes of the Company or the Subsidiary and do not unreasonably interfere with the performance of his duties or responsibilities as set forth in this Agreement, and provided that Kane shall not engage in any activities in violation of Articles 7 and 8 of this Agreement. Kane may also serve as a member of the board of directors of other organizations, subject to the same limitations, upon advance approval of the Company President and CEO. For purposes of this section Kane will at no time own in excess of 1% of the outstanding securities of any publicly traded company entitled to vote for the election of directors (or other than of a corporation in which Kane makes passive investments through a venture fund or similar investment vehicle) that is a Competitor of the Company or Subsidiary.


ARTICLE 2


RELATIONSHIP WITH BOARD


2.1. Prior Authorization of Significant Actions Required. Unless
--------------------------------------------------- otherwise specifically permitted by Company or Subsidiary policy, Kane agrees not to undertake, or authorize any other employee of the Company or Subsidiary to undertake, any of the following actions, except with the prior written consent of the Subsidiary Board, which consent may be withheld in the Board's absolute discretion (or except as authorized by the Company's CEO in certain instances noted below):


(a) guarantee by the Company or the Subsidiary of any loans or indebtedness of any kind;


(b) acquisition or disposition of stock, securities, properties, or material assets of any corporation, company, or other entity by the Company or the Subsidiary;


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(c) amendment, change, extension, renewal, waiver, or modification of any agreement that exceeds $50,000 or involves payment exceeding $50,000 to which the Company, the Subsidiary, or affiliates are or may be a party, or any rights or obligations of the parties under any of the foregoing;


(d) change or engage in business activities not within the scope of the corporate purpose of the Company or Subsidiary, or the Company's or Subsidiary's Articles of Incorporation, Bylaws, or other organizational documents;


(e) sale, assignment, pledge, mortgage, encumbrance or other transfer affecting assets or real or personal property of the Company or Subsidiary except in the ordinary course of business;


(f) enter into any contract or commitment, or series of contracts or commitments, written or oral, which in the aggregate, requires the Company or Subsidiary to expend or incur liability or debt substantially in excess of the approved Company or Subsidiary budgets for such expenditure;


(g) compromise or settle any material claim asserted by or against the Company or Subsidiary;


(h) change the Company's or Subsidiary's certified public accountants, law firms, or other professionals currently retained or utilized by the Company or Subsidiary;


(i) change location of the principal office, or other facilities of the Company or Subsidiary;


(j) lend money on behalf of the Company or Subsidiary; or


(k) add a position or personnel function, hire an officer, or terminate Company or Subsidiary employees, or enter into employment contracts or commitments other than on an at-will basis and in accordance with standard Company terms and conditions without the prior consent of the Company's CEO.


2.2. Board Action. Unless otherwise noted herein, whenever any action
------------ by the Company's Board or the Subsidiary's Board is required or permitted under this Agreement, the Chairman of the respective Board, or his designee, may decide and take such action without approval or involvement of the full Board or a majority of the Board. To the extent required, a vote of the full Board shall occur at a meeting duly called and held with a quorum acting throughout in accordance with the applicable Articles of Incorporation and bylaws, and such action must be evidenced in writing before being effective. Meetings held by the Board in accordance with this Agreement may be conducted by teleconference, and in executive session.


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2.3. Indemnification. Kane will be subject to indemnification for
--------------- action taken within this authority as President and CEO in accordance with Company's existing D&O liability policy.


ARTICLE 3


COMPENSATION AND BENEFITS


3.1. Salary. The Company agrees to pay Kane, for services rendered
------ hereunder, salary at the annual rate of ONE HUNDRED AND EIGHTY TWO THOUSAND DOLLARS ($182,000). Such salary shall be payable in equal periodic installments, not less frequently than monthly, less any sums which may be required to be deducted or withheld under the provisions of law. Kane's salary may not be adjusted downward at any time during the term of this Agreement without his express consent. Kane's salary may be adjusted upward annually at the discretion of the Company's Board, based upon the Board's assessment of Kane's performance and the Company's and/or Subsidiary's performance and financial circumstances. Kane will be considered for his next annual salary raise at the time of his performance review in March 2002, and will be considered for further raises at each one-year anniversary thereafter during the term of this Agreement. As referred to hereinafter, "Salary" means the compensation described in this
------ Section 3.1.


3.2. General Expenses. Kane is expected from time to time to incur
---------------- reasonable and necessary expenses for promoting the business of the Company, including expenses for travel, entertainment, and other activities associated with Kane's duties. Reasonable and necessary expenses, as determined by the Company, incurred by Kane in connection with the performance of his duties hereunder will be reimbursed provided that Kane follows Company procedures for the reimbursement of such expenses, including submission of reasonably detailed verification of the nature and amount of such expenses.


3.3. Benefits. Except as otherwise provided in this Agreement, Kane
-------- will be entitled to participate in the same manner as other executive and managerial employees of the Company in all retirement, health and welfare, and other fringe benefit programs applicable to other managerial employees of the Company generally which may be authorized, adopted and amended from time to time by the Company Board. This includes eligibility to participate in the Company's qualified retirement plans as permitted by the terms of such plans. Specific benefits that Kane is eligible to receive include:


(i) Medical Insurance. So long as the Company provides health and dental insurance, Kane (and his eligible family members) shall have the opportunity to participate in the same manner and on the same terms as other officers and employees of the Company.


(ii) Long-term disability. The Company shall pay Kane's full premiums for long-term disability insurance coverage, providing a disability benefit of up to 60% of Kane's salary (as defined by the


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applicable plan or policy), up to a maximum of $10,000 per month, so long as the Company offers group long-term disability insurance coverage for its employees.


(iii) Thrift and Profit Sharing Plan. Kane is eligible to participate in the Company Thrift and Profit Sharing in accordance with the terms and provisions of the Plan.


(iv) Annual physical examination. The Company agrees to provide, at no cost to Kane, one annual physical examination through a doctor of Kane's choice.


(v) Life insurance. The Company shall pay Kane's premiums for his purchase of a term life insurance policy, providing a death benefit of $500,000, through a Company-approved carrier.


(vi) Vacation. Kane shall be entitled to receive four weeks of vacation leave each calendar year. Provisions regarding the accrual and carry-over of any unused vacation time will be governed by the Company's standard policies.


3.4. No Other Compensation. Except as provided in Article 4 hereof,
--------------------- Kane shall receive no compensation or remuneration in addition to that set forth in this Article 3 for any services by him in any capacity to the Company, the Subsidiary, or any affiliated corporation. Nothing contained herein shall, however ...