EXHIBIT 10.4
EXECUTIVE EMPLOYMENT CONTRACT,
DATED AS OF MARCH 31, 2004, BETWEEN XXXXX XXXXXX AND ADVANTAGE FINANCE, INC.
EXECUTIVE EMPLOYMENT CONTRACT
THIS CONTRACT is made as of March 31, 2004 ("Effective Date"), between
ADVANTAGE FINANCE, INC. ("Advantage"), an Ohio corporation having an address of
000 X. Xxxxxxxx Xxxxxx, X.X. Xxx 00, Xxxxx Xxxxxxxx, Xxxx 00000, and XXXXX
XXXXXX ("Xx. Xxxxxx"), having an address of __________________________________,
for Xx. Xxxxxx'x employment by Advantage as President ("President") of
Advantage.
BACKGROUND
A. Advantage desires to employ Xx. Xxxxxx under the terms and conditions set
forth in this Contract.
B. Xx. Xxxxxx desires to be employed by Advantage under the terms set forth
in this Contract. In consideration of the promises contained in this
Contract, the parties agree as follows:
1. EMPLOYMENT. Upon the terms and subject to the conditions of this Contract,
Advantage hereby agrees to employ Xx. Xxxxxx. Upon the terms and subject to the
conditions of this Contract, Xx. Xxxxxx agrees to serve as a full time employee
of Advantage.
2. SERVICES RENDERED.
(a) General. Xx. Xxxxxx shall render services and perform the duties of
the position of President of Advantage. Subject to Subsections 2(b) and 2(d),
Xx. Xxxxxx shall perform such other duties and have such other responsibilities
for Advantage as are of the same character and nature as those typically
performed by the president of a finance company of comparable size and with a
comparable market to that of Advantage.
(b) Reporting. Xx. Xxxxxx shall be subject to the supervision and
direction of the Board of Directors of Advantage ("Board"). Xx. Xxxxxx shall
have the authority set by the Advantage Code of Regulations and the authority
delegated by the Board. Xx. Xxxxxx will report to the Chair of the Board and to
the Board. The Chair of the Board will participate in an annual evaluation by
the Board of Xx. Xxxxxx'x performance.
(c) Full time employee. Xx. Xxxxxx shall devote his full time employment
during the term of this Contract to the faithful and diligent performance of his
duties for Advantage. Xx. Xxxxxx shall not engage in other business activities,
whether or not the business activities are pursued for gain, profit, or other
pecuniary advantage without the prior written consent of Advantage.
(d) Adherence to standards. Xx. Xxxxxx shall perform all duties in a
competent and professional manner. Xx. Xxxxxx shall abide by the Articles of
Incorporation and Code of Regulations of Advantage; the rules, regulations,
policies, and performance objectives of Advantage as they exist from time to
time; applicable ethical and business standards; and the law. The parties
understand that collaborative goals and objectives will be developed, and that
progress towards these established criteria will be used to determine
performance. Xx. Xxxxxx shall be responsible for developing risk management
policies and procedures for Advantage that use as primary tools for risk
management compliance with ethical, legal, and business standards; training; and
audits and other retrospective reviews of compliance with appropriate standards.
Advantage intends to grow, to seek additional markets, and to increase
profitability (which intentions Xx. Xxxxxx acknowledges), and, as a result, Xx.
Xxxxxx and Advantage acknowledge that performance standards may change as
Advantage changes; however, compliance with ethical standards and the law shall
remain constant.
3. COMPENSATION.
(a) Base salary. During the initial term of this Contract, Advantage shall
pay Xx. Xxxxxx a base salary of $75,000, subject to all applicable withholdings,
in accordance with the then current policies of Advantage for executive
compensation. The base salary provided by this Section 3(a) as adjusted under
Section 3(c) may be called "base salary".
(b) Employee benefits. In addition to the base salary, Advantage shall
provide to, or for the benefit of, Xx. Xxxxxx the following employee benefits:
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(i) Vacation and sick leave. Participation in the vacation and sick
leave plan maintained for executives of Advantage, which includes three weeks of
vacation until Xx. Xxxxxx'x 15-year anniversary with Advantage and four weeks
thereafter.
(ii) Business expense reimbursement. Reimbursement for, or payment
of, the reasonable business and entertainment expenses incurred by Xx. Xxxxxx on
behalf of Advantage pursuant to the written policies of Advantage or as
otherwise approved by the Board.
(iii) Continuing education/seminars. Reimbursement for reasonable
expenses incurred by Xx. Xxxxxx for continuing education or seminar programs
attended by Xx. Xxxxxx that are approved by Advantage. Such attendance shall not
constitute vacation time, if the attendance is approved by the Chair of the
Board.
(iv) Benefit plans. Participation in the retirement and welfare
benefit plans made available to the employees of Advantage and in any such other
similar plans maintained by Advantage on the same basis as the other executive
employees of Advantage who participate in such plans.
(v) Deferred compensation program. Participation in Advantage's
deferred compensation program to the extent authorized by law.
(vi) Health and disability insurance plans. Participation in the
family group health, disability, and other insurance plans made available to the
employees of Advantage and in any such other similar plans maintained for the
executives of Advantage on the same basis as the other executives participating
in such plans.
(vii) Life insurance plans. A term life insurance policy upon the
life of Xx. Xxxxxx in an amount equal to one and one-half times his annual base
salary continuing on if Xx. Xxxxxx becomes partially or permanently disabled.
(viii) Memberships. Reimbursement for, or payment of, the membership
dues and other expenses required to maintain the membership of Xx. Xxxxxx in
certain clubs and organizations that Advantage determines are beneficial to
Advantage.
(ix) Automobile. One new automobile for use within a 60-mile radius
of Upper Sandusky. Advantage may replace the automobile at such time or times as
Advantage may choose. Advantage shall furnish liability insurance, routine
maintenance, and fuel. Employee shall operate the vehicle in a lawful manner,
shall be responsible for all violations of law related to the vehicle, shall be
responsible for insuring that the automobile is maintained, shall maintain the
vehicle in first-class salable condition, and shall insure that the automobile
is available for Xx. Xxxxxx'x use in the business of Advantage. If it is
necessary or desirable to make major repairs to the automobile, Xx. Xxxxxx shall
seek the prior approval of Advantage. Xx. Xxxxxx shall be responsible for major
repairs resulting from improper or imprudent use or maintenance of the
automobile. "Major repairs" include repairing damage suffered in accidents, tire
replacement, and other repairs outside the regular schedule of maintenance
recommended by the manufacturer of the vehicle.
Xx. Xxxxxx shall submit regular reports of personal use of the employee
benefits required under the Internal Revenue Code to be treated as taxable
income to Xx. Xxxxxx in order to allow Advantage to determine the amount that
must be reported to the Internal Revenue Service as compensation to Xx. Xxxxxx.
In providing the employee benefits under this Section 3(b), the Board may
determine that the payment for any or all of such employee fringe benefits shall
be taken from the pre-tax salary of Xx. Xxxxxx, to the extent permissible under
applicable law.
The benefits provided under this Section 3(b) and under annual adjustments,
if any, under Section 3(c) may be called "employee benefits".
(c) Annual review. Xx. Xxxxxx'x base salary and employee benefits will be
reviewed and, in the discretion of Advantage, shall be subject to adjustment not
less frequently than annually, at the end of each calendar year during the term
of this Contract. Any adjustments to Xx. Xxxxxx'x base salary and employee
benefits (including any decision not to adjust base salary or employee benefits)
shall be made in the sole discretion of the Board.
4. TERM AND TERMINATION.
(a) Term; renewal; and non-renewal. Xx. Xxxxxx'x employment and this
Contract are effective as of the Effective Date and shall remain in full force
and effect for a period expiring March 31, 2006, unless earlier terminated. Xx.
Xxxxxx'x employment and this Contract shall be renewed automatically for a one
year period following the conclusion of the original term and following the end
of each subsequent one year period upon the terms and conditions set forth in
this Contract, unless either party
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gives written notification to the other party of the intention not to renew this
Contract or to alter any of its terms and conditions not less than 60 days prior
to the termination hereof.
(b) Termination by Advantage without cause. Advantage may terminate Xx.
Xxxxxx'x employment without cause by giving Xx. Xxxxxx a notice of termination.
The notice of termination without cause shall be effective upon the earlier of
actual receipt by Xx. Xxxxxx or two days after mailing by first class mail. If
Advantage terminates the employment of Xx. Xxxxxx without cause attributable to
Xx. Xxxxxx, for a period of twelve (12) months commencing the date on which Xx.
Xxxxxx is given notice of the decision to terminate, Advantage shall pay to Xx.
Xxxxxx the base salary in effect on the date of the notice of the decision to
terminate and provide or pay continuation and all Employee Benefits identified
in Section 3(b) of this Contract, except for reimbursement under Section
3(b)(ii) of business expenses incurred after notice of termination, continuing
education and seminar programs under Section 3(b)(iii) occurring after notice of
termination, and membership expenses in clubs and organizations under Section
3(b)(ix) (except for minimum costs necessary to maintain membership for six
months after notice of termination) (collectively, "continuation compensation").
Federal, state and local taxes, as well as social security contributions and
other normal deductions will be withheld from any continuation compensation.
During the period that Xx. Xxxxxx receives continuation compensation, Employee
Benefits shall be reduced by any similar benefits received from third parties
such as a subsequent employer. Neither termination of Xx. Xxxxxx'x employment
voluntarily by Xx. Xxxxxx nor a termination of Xx. Xxxxxx'x employment arising
out of illness or disability to perform the duties of his position will be a
termination without cause under this Subsection. Xxxxxx shall notify Advantage
in writing within 24 hours after accepting full or part-time employment with a
third party.
(c) Termination by Xx. Xxxxxx; termination by Advantage with cause. Xx.
Xxxxxx may terminate his employment under this Contract by giving Advantage 60
days notice of his intention to resign. Advantage may terminate Xx. Xxxxxx'x
employment with cause by giving Xx. Xxxxxx notice of termination for cause. The
notice of termination for cause is not required to describe the cause or causes,
but must state that the "termination of employment is for cause". The notice of
termination for cause shall be effective upon the earlier of actual receipt by
Xx. Xxxxxx or two business days after mailing by first class mail. If Xx. Xxxxxx
voluntarily terminates his employment or if Advantage terminates Xx. Xxxxxx'x
employment with cause, Advantage will not be obligated to pay continuation
compensation after the date of termination, except as required by law. "Cause"
includes, but is not limited to, conduct by Xx. Xxxxxx concerning any one or
more of the following: failure to adhere to ethical standards or the law; moral
and ethical misdeeds conducted on the job; failure to carry out the duties of
employment or to carry out directions of the Board; willful misconduct;
conviction of a felony; or conduct that otherwise interferes with the
performance of Xx. Xxxxxx'x duties or Advantage's business, including any
conduct that adversely reflects upon Advantage or its business and any conduct
committed during or outside of the employment relationship that, reasonably
considered, xxxxx the reputation of Advantage. As used in this subsection,
"conduct" includes one or more acts, one or more failures to act, or any
combination of the foregoing.
(d) Termination upon permanent disability. Xx. Xxxxxx'x employment shall
terminate upon the permanent disability of Xx. Xxxxxx. "Permanent disability"
means Xx. Xxxxxx'x physical or mental inability to perform the services required
under this Contract caused by a physical or mental condition or impairment for a
period exceeding 180 days. If a disability prevents Xx. Xxxxxx from performing
the services required under this Contract, Xx. Xxxxxx shall receive such
short-term and long-term disability coverage as shall have been purchased under
the programs then available to employees of Advantage.
(e) Consequences of termination of employment. Except for post-employment
obligations concerning continuation compensation, disability benefits,
non-competition, and confidentiality, upon termination of Xx. Xxxxxx'x
employment for any reason, this Contract shall terminate, Xx. Xxxxxx shall cease
all activity on behalf of Advantage and its affiliates, Xx. Xxxxxx shall
automatically, without further action by either party, be discharged from all
offices of Advantage and all offices of affiliates of Advantage held by Xx.
Xxxxxx, Xx. Xxxxxx shall confirm his discharge by resigning from all offices of
Advantage and its affiliates, Xx. Xxxxxx shall resign from all boards of
Advantage and the affiliates of Advantage, and Xx. Xxxxxx shall resign from all
employment by Advantage and affiliates of Advantage. Xx. Xxxxxx agrees that
provisions of this Subsection related to resignation are reasonable and that
remedies at law would be inadequate for a breach of the provisions of this
Subsection related to resignation. For these reasons, Advantage may enforce the
obligations of Xx. Xxxxxx under this Subsection by injunctive relief, including
a temporary restraining order, a preliminary injunction, and a
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permanent injunction and by an award for fees, costs, and expenses incurred by
Advantage to enforce this Subsection, including (but not limited to) attorneys'
fees, costs and expenses, and other expenses incurred to enforce this
Subsection.
Upon termination of this Contract with Advantage for any reason, Xx.
Xxxxxx shall promptly deliver to Advantage all physical property of Advantage
under his possession, custody or control, including (but not limited to), keys,
plans, designs, computer programs, computer lists, prospect lists, records,
letters, notes, reports, financial information, and all other materials relating
to Advantage, its subsidiaries and its affiliates, their businesses, or their
clients and customers.
5. NONCOMPETITION. During the initial term of this Contract any renewal term,
and for a period of one year following termination of this Contract for any
reason, Xx. Xxxxxx shall not provide services, by himself or by any entity in
which he has any ownership interest, or as an employee for any finance company
or any financial institution or bank holding company or any affiliate of a
finance company, financial institution, or bank holding company that provides
services to any customers or prospective customers of Advantage.
During the term of this Contract (initial term and any renewal period) and
for a period of one year thereafter, Xx. Xxxxxx (for himself or on behalf of a
third party) shall not employ, offer to employ, or solicit employment of any
employee of Advantage or any of its affiliates, subsidiaries or any professional
under contract with Advantage or any of its subsidiaries.
Xx. Xxxxxx agrees that he has received consideration to which he was not
otherwise entitled in return for his obligations under this Section, and that
the provisions of this Section are reasonable and necessary to protect the
legitimate business interests of Advantage, and are reasonable with respect to
time, territory, and business. Xx. Xxxxxx shall pay any and all legal fees,
costs, and other expenses incurred by Advantage in the course of legal action to
enforce the provisions of this Section. Xx. Xxxxxx agrees that the remedies at
law for a breach of this Section would be inadequate to protect Advantage
because money damages would be difficult, if not impossible, to ascertain and
would be estimable only by conjecture, and therefore, Xx. Xxxxxx agrees that
Advantage will be entitled to injunctive relief, including a temporary
restraining order, a preliminary injunction and a permanent injunction for any
such breach as well as all reasonable attorneys' fees, and costs and other
expenses incurred to enforce this provision. The duty to arbitrate disputes
under this Contract shall not apply to any claim for violation of this Section.
The obligations of Xx. Xxxxxx under this Section shall survive the
termination of the Contract for any reason.
6. CONFIDENTIALITY. Xx. Xxxxxx hereby acknowledges that he may be required to
handle Confidential Business Information in the performance of his
responsibilities. Xx. Xxxxxx is aware that this is proprietary information to
Advantage or the party supplying it and the exclusive property of Advantage or
its clients and customers, and Xx. Xxxxxx shall not disclose the Confidential
Business Information in any manner at any time, to others inside or outside
Advantage or to unauthorized employees and officers of Advantage. Unauthorized
disclosure or other mishandling of Confidential Business Information may result
in termination of this Contract and Xx. Xxxxxx'x employment for cause and in
other appropriate actions. Xx. Xxxxxx agrees that his obligation not to reveal
Confidential Business Information will remain in force permanently,
notwithstanding that Xx. Xxxxxx'x authorization to handle Confidential Business
Information is revoked while still under contract to Advantage, or as a result
of the termination of this Contract or Xx. Xxxxxx'x employment.
Except as Advantage may require or otherwise consent to in writing, Xx.
Xxxxxx shall not, at any time during or subsequent to the termination of this
Contract disclose or use in any way any information or knowledge or data
received or developed while providing services to Advantage, including but not
limited to, plans, designs, formulas, business processes, methods, test data,
inventions, discoveries, computer programs, customer/client lists, prospect
lists, financial information, and trade secrets of Advantage or its customers
(collectively, "Confidential Business Information").
In addition to any other remedies Advantage may have at law or in equity, Xx.
Xxxxxx agrees that Advantage will be entitled to a restraining order,
injunction, or similar remedy to enforce the terms of this Section and Xx.
Xxxxxx'x obligation under Section 4(e) to return property of Advantage, as well
as all reasonable attorneys' fees, costs, and other expenses incurred to enforce
this Section. The duty to arbitrate disputes under this Contract shall not apply
to any claim for a violation of this Section or Xx. Xxxxxx'x obligation under
Section 4(e) to return property of Advantage. The obligations of Xx. Xxxxxx
under this Section shall survive the termination of this Contract or any reason.
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7. INDEMNIFICATION. Advantage shall indemnify Xx. Xxxxxx for any and all acts
or omissions of Xx. Xxxxxx related in any way to his employment with Advantage,
provided Xx. Xxxxxx acted in good faith, in a manner reasonably believed to be
in, or not opposed to, the best interests of Advantage, and with the care that
an ordinary prudent person in a like position would use under similar
circumstances. Notwithstanding the preceding sentence, Advantage shall not be
obligated to indemnify Xx. Xxxxxx when such indemnification would be contrary to
law or public policy or appropriate ethical standards.
8. VALIDITY. The invalidity or unenforceability of any particular provision
of this Contract shall not affect the validity or enforceability of any other
provision contained in the Contract.
9. CHOICE OF LAW. This Contract and the interpretation of each of its
provisions shall be governed by the laws of the State of Ohio and the venue of
any dispute or litigation shall be Wyandot County, Ohio. The rights of the
parties under this Contract will likewise be governed by the laws of the State
of Ohio.
10. ENTIRE CONTRACT. This Contract contains the complete agreement between
the parties with respect to the subject matter of this Contract. The provisions
of this Contract are solely for the benefit of the parties to this Contract and
not for the benefit of any other persons or legal entities.
11. ASSIGNMENT. This Contract is binding on and inures to the benefit of
successors and assigns of Advantage. This Contract shall continue as a matter of
law in the event of a merger or consolidation of Advantage, and shall not be
deemed to be terminated in the event of an affiliation or combination other than
a merger or consolidation. Should there be such an affiliation or combination
and the successor entity fails to or refuses to honor the terms and conditions
of this Contract, this Contract shall be deemed terminated by Advantage without
cause.
12. AMENDMENTS. No representations have been made between Advantage and Xx.
Xxxxxx concerning the terms, conditions, and agreements of the contractual
relationship covered by this Contract other than those representations contained
in this Contract and no representations made during the course of performance of
services under this Contract can alter any of the provisions of this Contract.
This Contract supersedes any and all prior contracts and understandings between
Advantage and Xx. Xxxxxx and may not be orally changed, waived, or amended. No
change, waiver, or amendment in any form shall be binding unless signed in
writing by the Chair of the Board of Advantage and Xx. Xxxxxx.
13. ARBITRATION. Advantage and Xx. Xxxxxx agree to work in good faith to
resolve any disputes arising under this Contract. Any controversy or claim
arising out of or relating to the interpretation or application of this
Contract, or any breach hereof, shall be settled by arbitration in Wyandot
County in accordance with the Employment Dispute Resolution Rules of the
American Arbitration Association then in effect, and judgment upon the award
rendered by the arbitrator (s) shall be final and binding on the parties hereto
and may be entered in any court having jurisdiction thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Contract effective
as of the day and year first above written.
ADVANTAGE FINANCE, INC.
_______________________________ By _____________________________________
Xxxxx Xxxxxx Chair of the Board of Directors
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