Exhibit 10.21
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EXECUTION COPY
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EMPLOYMENT AGREEMENT
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AGREEMENT by and between ICON Capital Corp., a corporation organized and
existing under the laws of the State of Connecticut (the "Company"), and Xxxxx
Xxxxxx ("you" or the "Employee"), dated as of December 5, 1996.
In order to obtain Employee's services, the Company and Employee have each
decided to enter into this Employment Agreement.
1. Employment Period.
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(a) The terms and conditions of this Agreement shall be and remain in
effect during the continuation of the Employee's employment hereunder (the
"Employment Period"). The Employment Period shall commence on the date hereof
("Effective Date") and shall continue for an initial term of two (2) years
("Initial Period") and thereafter until terminated pursuant to the terms hereof.
(b) Nothing in this Agreement shall be deemed to prohibit the Company at
any time from terminating the Employee's employment during the Employment Period
with notice for any reason; provided, however, that the relative rights and
obligations of the Company and the Employee in the event of any such termination
shall be determined under this Agreement.
2. Terms of Employment.
(a) Position and Duties.
(i) Commencing on the Effective Date and for the remainder of the
Employment Period, the Employee shall be engaged as a Senior Vice President
of the Company, and as President of its affiliate, ICON Securities Corp.,
with an office located at San Francisco, California. Employee will report
to the Company's Executive Vice President of Financial Services and shall
have such duties, responsibilities and authority as shall be consistent
therewith (including being a member of any advisory investment committee
that may be established from time to time) and as the Board of Directors of
the Company shall from time to time reasonably determine; and
(ii) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Employee is entitled, the Employee shall
devote full business time to the business and affairs of the Company and use all
reasonable efforts to perform faithfully and efficiently such duties,
responsibilities and authority.
(b) Compensation.
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(i) Base Salary. Effective as of the Effective Date, the
Employee shall receive a base salary ("Base Salary") at a rate of
$150,000 per year. The Board of Directors may, at its sole discretion,
increase the Base Salary from the beginning of each subsequent fiscal
year of the Company, based upon its review of the Company's and the
Employee's performance;
(ii) Commission Plan. In addition to Base Salary, the
Employee shall be entitled to an Annual Commission calculated as follows
and payable thirty days after the end of each calendar year:
0.3% of equity raised up to $24 million per calendar year, plus 0.6% of
equity raised in excess of $24 million up to $36 million, plus 1.0% of
equity raised in excess of $36 million. On this basis, as an example, in
a calendar year wherein $48 million of equity was raised, your Annual
Commission would be calculated as follows:
First $24 million at 0.3%: $ 72,000
$24-$36 million at 0.6 %: $ 72,000
$36-$48 million at 1.0%: $120,000
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Total Commission $264,000
(iii) Parachute Payment. In addition to any payments under
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the Commission Plan, you may also become entitled to receive a special
"Parachute Payment" upon the occurrence of a "Triggering Event,"
provided you continue to be a full time employee of the Company on that
date. A Triggering Event shall be deemed to have occurred on the date on
which a change in control of the Company occurs in which (a) more than
50% of the voting stock of ICON Holdings Corp. ("Holdings") is sold to a
Non-Shareholder (defined herein as an entity or individual other than
Beaufort X.X. Xxxxxx, Xxxx X. Xxxxx, Xxxxxx X. Xxxxxx, The Summit Group
PLC, or any affiliates thereof or entities directly or indirectly
controlled by any of them); or (b) more than 36% of the voting stock of
Holdings is sold to a Non-Shareholder, and Xx. Xxxxxx does not continue
in his capacity as President and Chief Executive Officer at the closing
date of such a sale, and the Company's activities in raising limited
partnership equity are discontinued. The Parachute Payment shall be
payable in two installments at the times and in the applicable amount
shown on the attached Parachute Payment Schedule. The obligation to pay
the Parachute Payment may, in the sole discretion of the Company's
shareholders, be assigned to its direct or indirect shareholders and
treated as an obligation of such shareholders rather than the Company;
(iv) Incentive, Savings and Retirement Plans. During the
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Employment Period, the Employee shall be entitled to participate in all
incentive, savings and retirement plans, practices, policies and
programs, if any, applicable generally to other employees of the
Company;
(v) Welfare Benefit Plans. During the Employment Period, the
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Employee and/or the Employee's family, as the case may be, shall be
eligible for participation in and shall receive all benefits currently
entitled to under the Company's welfare benefit plans, practices,
policies and programs provided by the Company (including, without
limitation, medical, major medical, hospital, prescription, dental,
short-term and long-
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term disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and programs, if
any);
(vi) Expenses. During the Employment Period, the Employee shall
be entitled to receive prompt reimbursement for all reasonable expenses
incurred by the Employee in the performance of his duties hereunder;
(vii) Vacation. The Employee shall be entitled to at least two
weeks annual paid vacation during the Employment Period. Unused vacation
shall be carried forward without limitation; and
(viii) Payment Schedule. Base Salary shall be paid in
accordance with the regular payroll policies of the Company as
determined by the Board of Directors from time to time but in no event
less frequently than monthly.
3. Termination of Employment.
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(a) Death or Disability. The Employee's employment shall terminate
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automatically upon the Employee's death during the Employment Period. If the
Company determines in good faith that the Disability (as defined below) of the
Employee has occurred during the Employment Period, it may give to the Employee
written notice in accordance with this Agreement of its intention to terminate
the Employee's employment. In such event, the Employee's employment with the
Company shall terminate effective on the 60th day after receipt of such notice
by the Employee (the "Disability Effective Date"), provided that, within the 60
days after such receipt, the Employee shall not have returned to full-time
performance of the Employee's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Employee from the Employee's duties
with the Company on a full-time basis for 90 consecutive business days as a
result of incapacity due to mental or physical illness which is determined to be
total and permanent by a physician selected by the Company or its insurers;
provided, that the Employee shall be entitled, during the aforesaid 60 day
period, to challenge any determination of Disability by such a physician, and in
the event of such a challenge, the final decision shall be made by a physician
selected by the Company's physician and the Employee's physician.
(b) Cause. The Company may terminate the Employee's employment
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during the Employment Period for Cause. For purposes of this Agreement, "Cause"
shall mean dishonest conduct in connection with the performance of Employee's
duties hereunder, breach of fiduciary duty to the Company or its shareholders
involving personal profit, material or intentional failure to perform those
duties stated in Section 2(a)(i) under this Agreement (including material
failure to meet the equity-raising goals established from time to time by the
Company's Board of Directors), or fraud or conviction of a felony resulting in
or intended to result in injury to the Company.
(c) By Employee. Employee may terminate this Agreement at any time
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during the Employment Period if the Company fails to pay the Employee any amount
due hereunder within five days after such payment is due or the Company fails to
perform any of its material obligations hereunder ("Employee Termination").
(d) Notice of Termination. Any termination by the Company for Cause
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or any Employee Termination shall be communicated by Notice of Termination to
the other party hereto given
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in accordance with this Agreement. For purposes of this Agreement, a "Notice of
Termination" means a written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) to the extent applicable, sets
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Employee's employment under the provision so
indicated and (iii) if the Date of Termination (as defined below) is other than
the date of receipt of such notice, specifies the termination date (which date
shall be not more than thirty days after the giving of such notice). The failure
by the Employee or the Company to set forth in the Notice of Termination any
fact or circumstance which contributes to a showing of Cause or establishing the
right to an Employee Termination shall not waive any right of the Employee or
the Company hereunder or preclude the Employee or the Company from asserting
such fact or circumstance in enforcing the Employee's or the Company's rights
hereunder.
(e) Date of Termination. "Date of Termination" means (i) if the
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Employee's employment is terminated by the Company for Cause or pursuant to an
Employee Termination, the date of receipt of the Notice of Termination or any
later date specified therein, as the case may be, (ii) if the Employee's
employment is terminated by the Company other than for Cause or Disability, the
date on which the Company notifies the Employee of such termination and (iii) if
the Employee's employment is terminated by reason of death or Disability, the
date of death of the Employee or the Disability Effective Date, as the case may
be.
(f) Right to Cure. Notwithstanding any provision herein to the
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contrary, the Company or Employee, as applicable, shall have a right to cure the
matters giving rise to an Employee Termination or for Cause termination,
respectively, for a period of 30 days commencing upon the receipt of the Notice
of Termination. If Company or Employee successfully cures such matters within
such thirty day period to the satisfaction of the other party in its or his sole
discretion, the termination of this Agreement or any provision hereof noticed in
such Notice of Termination shall be void and ineffective.
4. Obligations of the Company Upon Termination.
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(a) Other Than for Cause, Death or Disability. If the Company shall
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terminate the Employee's employment other than for Cause, Death or Disability,
or in the event of an Employee Termination, the Company shall pay to the
Employee in a lump sum in cash within 10 Business Days after his Date of
Termination, the aggregate of the sum of (A) an amount equal to the remainder of
the Base Salary up to the date of expiration of the Initial Period or twelve
(12) months' Base Salary, whichever is greater, (B) any compensation previously
deferred by the Employee, (C) any accrued vacation pay, (D) any accrued
commissions yet unpaid, and (E) in the event Employee's employment is terminated
under the circumstances described above in this paragraph and a Triggering Event
occurs within six (6) months thereafter, the Parachute Payment described above
under paragraph 2(b)(iii) and the attached Parachute Payment Schedule in
accordance with the terms thereof.
(b) Death; Disability. If the Employee's employment is terminated
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by reason of the Employee's death or Disability during the Employment Period,
this Agreement shall terminate without further obligations to the Employee or
the Employee's legal representatives, as the case may be, under this Agreement,
other than for payment of any deferred payments.
(c) Cause; Voluntary Termination. If the Employee's employment
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shall be terminated for Cause during the Employment Period or in the Event the
Employee voluntarily
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terminates employment during the Employment Period, this Agreement shall
terminate without further obligations to the Employee.
5. Non-Competition. During the Employment Period and for a period
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of twelve (12) months following the Date of Termination, as long as the Company
is not in default under this Agreement, Employee shall not:
(a) directly or indirectly, either individually or as a principal,
partner, member, agent, employee, consultant, stockholder, joint venturer or
investor, or as a director or officer of any corporation, entity, proprietorship
or association, or in any other ownership, executive or management position,
engage or assist in activities, or have an active interest, of an ownership,
executive, management or consulting nature in a business in the business of
marketing and selling income fund products that would compete with the equipment
leasing investment funds products of the Company actually being marketed at the
time of termination;
(b) directly or indirectly, either individually or as a principal,
partner, member, agent, employee, consultant, stockholder, joint venturer or
investor, or as a director or officer of any corporation, entity, proprietorship
or association, or in any other ownership, executive or management position
whatsoever, (i) divert or attempt to divert from the Company any business with
any customer or prospective customer with which Employee has any business
contact or business association which was either under Employee's supervision or
the identity of which was learned by Employee while employed by the Company,
(ii) induce any salesmen, vendor, broker, dealer, representative, agent, or
other person transacting business with the Company to transact business for a
business in competition with the Company at the time of termination, or (iii)
induce or cause any employee of the Company to leave the employ of the Company
other than in the course of the loyal discharge of his duties.
Notwithstanding the above, this Section 5 shall not prohibit the Employee from
passively owning less than five percent (5%) of the shares of any corporation or
entity that is publicly traded on a securities exchange or over-the-counter
market.
6. Confidential Information.
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(a) From the date hereof and at all times thereafter, the Employee shall
not at any time or in any manner, directly or indirectly, knowingly disclose to
any party, other than the Company or at the request of the Company, any trade
secrets or Confidential Information (as defined below) of the Company while
employed by the Company and for six (6) months after termination of employment.
As used herein, Confidential Information shall mean non-public information
provided to Employee by the Company in connection with his evaluation of this
employment opportunity and information hereafter obtained by Employee as an
employee of the Company and not generally known in the Company's industry and
that relates in any way to the business of the Company at any time during the
Employment Period, including without limitation any and all data bases, trade
secrets, know-how, and other intellectual property obtained or developed during
the Employment Period.
(b) Employee acknowledges that during the course of his employment
with the Company he may develop or otherwise acquire papers, files or other
records involving or relating to trade secrets or Confidential Information. All
such papers, files and other records shall be the exclusive property of the
Company and shall, together with any and all copies thereof, be returned to the
Company upon the termination of Employee's employment with the Company.
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7. Specific Performance. The Employee acknowledges that the covenants
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of the Employee in Section 5 and Section 6 are special and that the Company will
be irreparably harmed if the Employee's obligations thereunder are not
specifically enforced and that the Company would not have an adequate remedy at
law in the event of a violation or threatened violation thereof. Therefore, the
Employee agrees that the Company shall be entitled to seek an injunction or a
remedy of specific performance for any actual or threatened violations or breach
by the Employee without necessity of the Company showing actual damages or that
monetary damages would not afford an adequate remedy. Employee shall have no
personal monetary liability arising out of or in connection with this Agreement,
except to the extent the Company suffers injury on account of the Employee's
willful and intentional actions resulting in or intended to result in injury to
the Company and only to the extent such willful and intentional actions result
in personal gain to the Employee.
8. Successors and Termination. This Agreement is personal to the
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Employee and without the prior written consent of the Company shall not be
assignable by the Employee otherwise than by will or the laws of descent and
distribution. This Agreement shall insure to the benefit of and be enforceable
by the Employee's legal representatives. This Agreement may not be assigned by
the Company without the prior written consent of Employee except as provided
herein.
9. Miscellaneous.
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(a) The laws of the State of California shall govern this Agreement
and any interpretations or constructions thereof. The captions of this Agreement
are not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors, assigns and legal
representatives, as the case may be.
(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, or by overnight
courier or by facsimile with confirmed transmission (with a hard copy mailed)
addressed as follows:
If to the Employee:
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Xxxxx Xxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
If to the Company:
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ICON Capital Corp.
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx
Attention: President
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
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(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement such Federal, state, local or foreign taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) The Employee's or the Company's failure to insist upon strict
compliance with any provision hereof or any other provision of this Agreement or
the failure to assert any right the Employee or the Company may have hereunder
shall not be deemed to be a waiver of such provision or right or any other
provision or right of this Agreement.
(f) This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original and all of which together shall be
deemed to be one and the same instrument. It shall not be necessary in making
proof of this Agreement or any counterpart hereof to produce or account for any
other counterpart.
(g) The terms defined in this Agreement have the meanings assigned to
them in this Agreement and include the plural as well as the singular, and the
words of any gender shall include each other's gender where appropriate.
(h) Any disputes, controversies, or claims arising between the parties
hereto arising out of or relating to this Agreement, or any provision thereof,
or the breach, termination or invalidity hereof, or the rights and obligations
created hereunder by the parties hereto (collectively "Disputes"), shall be
finally determined and settled by arbitration in accordance with the commercial
rules of the American Arbitration Association ("AAA"), as such are in force at
the time a demand for arbitration is made, as described below.
(i) Any dispute, controversy or claim relating to this Agreement, or
any provision thereof, or any breach or default in the performance of the terms
and conditions hereof shall be settled by arbitration in the City of White
Plains in accordance with the then-existing arbitration rules promulgated by the
AAA. The decision of the arbitrators shall be final and binding on the parties,
and judgment upon the award rendered by the arbitrators may be entered in any
court having jurisdiction thereof.
(ii) In any arbitration proceeding under this Section 9(h), the rights
of the parties shall be determined according to the governing law set forth in
Section 9(a) above, and the arbitrators shall apply such law.
(iii) The prevailing party shall be entitled to recover from the non-
prevailing party all costs and fees, including reasonable attorney's fees,
incurred by such prevailing party in connection with such Dispute.
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IN WITNESS WHEREOF, the Employee has hereunto set the Employee's hand, and
the Company has caused these presents to be executed in its name on its behalf,
all as of the day and year first above written.
______________________________________
Xxxxx Xxxxxx
ICON CAPITAL CORP.
By:____________________________________
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PARACHUTE PAYMENT SCHEDULE
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Upon the occurrence of a Triggering Event, the applicable "Parachute Payment"
set out below will become payable to the Employee in two installments: 50% on
the date of the Triggering Event and the remaining 50% balance on the earlier of
(a) Employee's involuntary employment termination after the Triggering Event or
(b) six months after the Triggering Event. Employee shall only be entitled to a
Parachute Payment if he is employed full time by the Company on the date of the
Triggering Event or if Section 4(a)(E) applies, and shall not be entitled to
receive the second Parachute Payment installment if he has voluntarily
terminated his employment or been terminated for Cause on the date such second
installment would otherwise be due.
Equity Raised in 12 Full Months Parachute
Prior to Triggering Event Amount (in $s)
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Less than 24,000,000 150,000 plus .25% of
equity raised
24,000,000 210,000
25,000,000 232,500
26,000,000 253,000
27,000,000 279,500
28,000,000 307,000
29,000,000 340,500
30,000,000 375,000
31,000,000 401,200
32,000,000 427,800
33,000,000 463,100
34,000,000 494,000
35,000,000 527,500
36,000,000 552,000
37,000,000 570,100
38,000,000 592,600
39,000,000 619,800
40,000,000 648,000
41,000,000 669,000
42,000,000 699,000
43,000,000 730,000
44,000,000 748,800
45,000,000 772,500
46,000,000 806,000
47,000,000 826,400
48,000,000 852,000
49,000,000 863,500
50,000,000 875,000
51,000,000 886,500
52,000,000 898,000
53,000,000 909,500
54,000,000 921,000
55,000,000 1,015,000
56,000,000 1,028,000
57,000,000 1,041,000
58,000,000 1,054,000
59,000,000 1,067,000
60,000,000 1,200,000
Over 60,000,000 300,000 plus 1.5% of
equity raised
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