Employment Agreements

The Company has entered into employment agreements with its current President and Chief Executive Officer and its former President and Chairman, which have terms of approximately

five

years and which renew in accordance with their terms. The agreements provide that, if the officers’ employment is terminated without cause, as defined in the agreements, the officers are entitled to receive certain severance payments. If termination occurs due to retirement, the officers will enter into a

four

-year consulting arrangement with the Company at a specified percentage of the officers’ then current salaries. Upon death or disability, the Company will also make certain payments to the executive or the executive’s estate or beneficiary, as applicable.

During the

fourth

quarter of

2017,

the Company’s former President and Chairman passed away, which resulted in a death benefit expense of

$619,000,

in accordance with his employment agreement. The expense for the years ended

December 31, 2018

and

2017

was

and

$619,000,

respectively. The related accrued liability as of

December 31, 2018

and

2017

was

$430,000

and

$619,000,

respectively.