Contract
EXHIBIT
10.1
RESTATED
EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT is effective as of September 1, 2005 by and between
Coastal
Credit, L.L.C., a Virginia limited liability company (“Company”) and Xxxxxxx X.
XxXxxxxx (“Executive”).
WHEREAS,
Executive has served for many years as the Chief Executive Officer of the
Company, and the Executive and the Company desire to confirm and restate
the
terms of Executive’s employment by the Company;
WHEREAS,
By entering into this Restated Employment Agreement, Executive and the Company
hereby amend and restate the Employment Agreement between the parties, dated
April 11, 1998, (“Prior Agreement”) in its entirety as set forth below.
NOW,
THEREFORE, the parties agree as follows:
1. Definitions.
The
terms defined in this Section 1 shall have the respective meanings indicated
below for all purposes of this Agreement.
(a) Affiliate.
“Affiliate” of a Person means a Person that directly or indirectly through one
or more intermediaries, controls, is controlled by, or is under common control
with, the first Person. “Control” means the possession, directly or indirectly,
of the power to direct or cause the direction of the management policies
of a
Person, whether through the ownership of voting securities, by contract,
as
trustee or executor, or otherwise.
(b) Cause.
“Cause”
shall mean any one or more of the following:
i. engaging
in a material dishonest act, including without limitation any material
misrepresentation or intentional omission to state a material fact to White
River Capital, Inc. (“Parent”) or Parent Board, willful breach of fiduciary
duty, misappropriation or fraud against the Company or any Affiliate of the
Company;
ii. any
indictment or similar charge against Executive by a governmental authority
alleging the commission of a felony, or a guilty plea or no-contest plea
by
Executive to a felony;
iii. material
failure by Executive to follow the Company’s general policies, directives or
orders applicable to officers of the Company after failing to cure prior
similar
failures within thirty (30) days of receiving written notice thereof from
the
Parent authorized by the Parent Board;
iv. intentional
destruction or theft of the Company’s property or falsification of the Company’s
documents;
v. a
breach
by Executive of the provisions of Section 12 or 13; or
vi. a
material breach by Executive of any other provision of this Agreement and
the
failure by Executive to cure such breach within thirty (30) days of the date
on
which the Company gives Executive notice thereof.
(c) Change
of Control.
“Change
of Control” shall mean:
i. the
consummation of a plan of dissolution or liquidation of the Company or Parent;
ii. the
individuals who, as of the effective date hereof, are members of the Parent
Board (“Incumbent Board”), cease for any reason to constitute at least a
majority of the members of the Board; provided, however, that if the election,
or nomination for election by the Parent’s shareholders, of any new director was
approved by a vote of at least two-thirds of the Incumbent Board, such new
director shall, for purposes of this Plan, be considered as a member of the
Incumbent Board; provided, further, however, that no individual shall be
considered a member of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened “election contest” or other
actual or threatened solicitation of proxies or consents by or on behalf
of an
individual, entity or group (within the meaning of Section 13(d) or 14(d)
of the
Exchange Act) (a “Person”) other than the Parent Board (a “Proxy Contest”)
including by reason of any agreement intended to avoid or settle any election
contest or Proxy Contest;
iii. the
consummation of a plan of reorganization, merger or consolidation involving
the
Company or the Parent, except for a reorganization, merger or consolidation
where (A) the shareholders of the Company or the Parent, respectively,
immediately prior to such reorganization, merger or consolidation own directly
or indirectly at least a majority of the combined voting power of the
outstanding voting securities of the company resulting from such reorganization,
merger or consolidation (the “Surviving Company”) in substantially the same
proportion as their ownership of voting securities of the Company or Parent,
respectively, immediately prior to such reorganization, merger or consolidation,
and (B) the individuals who were members of the Incumbent Board immediately
prior to the execution of the agreement providing for such reorganization,
merger or consolidation constitute at least a majority of the members of
the
board of directors of the Surviving Company, or of a company beneficially
owning, directly or indirectly, a majority of the voting securities of the
Surviving Company;
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iv. the
sale
of all or substantially all the assets of the Company to another Person outside
the ordinary course of business; or
v. the
acquisition by another Person of beneficial ownership (within the meaning
of
Rule 13d-3 promulgated under the Exchange Act) of stock representing more
than
fifty percent (50%) of the voting power of the Parent or the Company then
outstanding by another Person, other than as a result of an original issuance
of
equity interests approved by the Incumbent Board.
(d) Date
of Termination.
“Date
of Termination” shall mean in the case of Executive’s death, the date of death,
in the case of Disability, thirty (30) days after Notice of Termination is
given
(provided Executive shall not have returned to the full-time performance
of his
duties during such thirty (30) day period), and in all other cases, the date
specified in the Notice of Termination, which shall be at least thirty (30)
days
after the date of the Notice of Termination, unless the termination is by
the
Company for Cause.
(e) Disability.
“Disability” shall occur if as a result of Executive’s incapacity due to
physical or mental illness, Executive shall have been absent from the full-time
performance of his duties with the Company for three (3) consecutive
months.
(f) Good
Reason.
“Good
Reason” shall mean any one or more of the following bases for termination of
Executive’s employment by Executive:
i. the
removal of Executive as Chief Executive Officer of Company without
Cause;
ii. the
assignment to Executive of any duties inconsistent in any material respect
with
Executive’s position, authority, duties or responsibilities as contemplated by
Section 5(a) of this Agreement, excluding for this purpose an isolated,
insubstantial or inadvertent action not taken in bad faith and which is remedied
by the Company promptly after receipt of notice thereof given by the
Executive;
iii. an
action
of Company that requires Executive to move from his permanent place of
residence.
iv. a
Change
of Control of the Company or Parent shall have occurred within the preceding
12
months;
v. any
action by the Company to reduce Executive’s base compensation below the amount
established in Section 6; failure by the Company to timely pay salary, bonus
or
incentive payments due Executive under Section 6; or failure by Company to
establish the long-term incentive award called for by Section 6 within 120
days
of the effectiveness of this restated agreement.
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(g) Net
Pre-Tax Income.
“Net
Pre-Tax Income” shall mean net income of the Company before provision for
federal or state taxes and after expenses paid by related parties that are
appropriately and equitably allocated to the Company, all as determined in
accordance with generally accepted accounting principles consistently
applied.
(h) Notice
of Termination.
Any
termination of Executive’s employment by either the Company or Executive, except
for a termination based on Executive’s death, shall be Communicated by a written
Notice of Termination.
(i) Parent
Board.
“Parent
Board” shall mean the Board of Directors of Parent or a duly authorized
committee of such Board, in either case, acting, if appropriate due to
Executive’s potential conflict of interest with respect to matters under this
Agreement, without the participation of Executive.
(j) Person.
“Person” shall mean any natural person, corporation, partnership, association,
limited liability company, trust, governmental authority, or other
entity.
(k) Retirement.
“Retirement” shall mean termination of Executive’s employment after Executive
has attained age 65.
2. Employment.
The
Company hereby employs Executive and Executive hereby accepts employment
with
the Company for the Term of this Agreement set forth in Section 3 below,
in the
position and with the duties and responsibilities set forth in Sections 4
and 5
below, and upon the other terms and conditions hereinafter stated.
3. Term.
This
Agreement is for the period commencing on the date hereof (the “Commencement
Date”) and terminating on December 31, 2008, or upon Executive’s earlier death,
termination by reason of Disability or termination by either party pursuant
to
Section 10 (the “Initial Term”). The Initial Term shall be automatically
extended for successive one-year periods (each a “Renewal Term,” with the
Initial Term and any Renewal Terms collectively referred to herein as the
“Term”), unless at least ninety (90) days prior to the end of the Initial Term
or any Renewal Term, either party, by a written notice delivered to the other
party, elects not to have the Term automatically extended.
4. Position.
Executive shall serve as President and Chief Executive Officer of the
Company.
5. Duties
and Responsibilities.
(a) The
Company hereby engages Executive as a full-time executive employee and Executive
accepts such employment, on the terms and subject to the conditions set forth
in
this Agreement. During the Term, Executive shall devote all of his business
time
and best efforts to, and shall perform faithfully, loyally and efficiently,
his
duties as President of the Company and shall exercise such powers and fulfill
such responsibilities as may be duly assigned to or vested in him by the
Operating Agreement or by the Parent as managing member of the
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Company
as directed by the Parent Board consistent with the responsibilities of the
President.
(b) During
the Term, Executive will not engage in other employment or consulting work
or
any trade or business for his own account or on behalf of any other Person.
Notwithstanding the foregoing, Executive may (i) serve on such corporate,
civic,
industry or charitable boards or committees as are approved by the Managers
and
(ii) manage his own and his immediate family’s personal investments, provided
that the activities permitted by clauses (i) and (ii) above shall not,
individually or in the aggregate, interfere in any material respect with
the
performance of Executive’s responsibilities hereunder.
6. Salary/Bonus.
(a)
For
all services rendered by Executive under this Agreement, the Company shall
pay
to Executive an aggregate annual base salary of $300,000, payable, in equal
installments, at least monthly, in accordance with the Company’s regular payroll
procedures. Such initial base salary shall be retroactively effective from
September 1, 2005. The Company shall review possible increases in Executive’s
salary at least annually, with any such increases subject to the determination
of the Parent as directed by the Parent Board in its sole
discretion.
(b)
For
calendar 2005, Executive will be eligible for an annual performance bonus
of
$300,000, prorated for the portion of 2005 after August 31. Thereafter,
Executive will be eligible for an annual performance bonus of 3% of the annual
consolidated Net Pre-Tax Income of the Company (unless an alternative basis
for
determining the annual performance bonus is agreed to in writing by the
parties.)
(c)
In
addition, simultaneously with the execution of this Agreement, the Company
and
Executive shall execute a long-term cash incentive award agreement, in the
form
of attached
Exhibit
A.
This
award agreement provides that on each of January 1, 2007, January 1, 2008
and
January 1, 2009 (each a “Vesting Date”), Executive shall receive a cash payment
from the Company equal to the value of 33,333.33 shares of White River Capital,
Inc. common stock, the value of which shall be determined based on the mean
of
the Fair Market Value (as defined in the White River Capital, Inc. Incentive
Stock Plan) of a share of White River Capital, Inc. common stock for the
20
trading days immediately preceding the Vesting Date.
7. Employee
Benefits.
The
Company shall provide or cause to be provided to Executive and to Executive’s
dependents, at the Company’s expense, all disability, medical and dental
benefits provided to other executives of the Company. During any waiting
period
for insurance eligibility, COBRA insurance costs for Executive and Executive’s
dependents will be paid by the Company. In addition, the Company shall pay
the
Executive $800 per month as an automobile allowance to cover the cost of
Executive’s use of an automobile for Company
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purposes.
During the Term of this Agreement, Executive shall maintain insurance in
connection with the automobile as required by state law and such other insurance
as is reasonably satisfactory to the Company. If the terms of such insurance
policy allow it, the Company shall be named as an additional insured on all
such
coverage.
8. Vacation.
Executive shall be entitled to four (4) weeks vacation during each consecutive
twelve month period of employment beginning on the Commencement Date and
each
anniversary thereof. In the event that the full vacation is not taken by
Executive during any such period, no vacation time shall accrue for use in
future periods, except as approved by the Parent Board.
9. Business
Expenses.
Executive will be reimbursed for all reasonable ordinary and necessary business
expenses incurred by Executive in connection with Executive’s employment (to be
supported by receipts and other documentation as required by the Internal
Revenue Code of 1986, as amended, and in conformance with the Company’s normal
procedures).
10. Termination.
Either
the Company or Executive may terminate the employment of Executive at any
time
prior to the expiration of the Term of this Agreement, with or without Cause
or
Good Reason.
11. Payments
During Disability and Upon Termination or Expiration.
Executive or his estate shall be entitled to the following during a period
of
Disability, upon Executive’s death, upon termination of Executive’s employment
by Executive or the Company, or if the Term of this Agreement is not extended
by
reason of notice given by either party pursuant to Section 3 hereof, as the
case
may be:
(a) During
any period that Executive fails to perform his full-time duties with the
Company
as a result of incapacity due to physical or mental illness, until such time
as
Executive returns to the full-time performance of his duties or the Date
of
Termination if Executive’s employment is terminated for Disability, Executive
shall continue to receive his base salary at the rate in effect at the
commencement of any such period minus any disability benefits received by
him
under any insurance or disability plan of the Company. If terminated for
Disability, Executive shall additionally be entitled to receive the severance
compensation provided for in subsection 11(c)(i) (reduced by any disability
benefits received by him under any insurance or disability plan of the Company),
as well as subsections11(c) (ii), (iii) and (iv) hereof.
(b) If
(1)
Executive’s employment is terminated by Executive without Good Reason and other
than upon Retirement; (2) Executive’s employment is terminated by the Company
for Cause; or (3) this Agreement is terminated by reason of Executive’s notice
of non-renewal, as provided in Section 3 hereof, then Company shall pay
Executive his full base salary through the Date of Termination at the rate
in
effect at the time Notice of Termination is given, plus all other amounts
or
benefits to which Executive is entitled through such date under any plan,
arrangement or practice in effect at the time of such termination, minus
any
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amounts
owed by Executive to the Company. Executive shall not be entitled to receive
any
bonus applicable to the period in which termination occurs, and the Company
shall have no further obligations to Executive under this Agreement (other
than
under COBRA and for vested and accrued benefits and accrued and unpaid
vacation). Notwithstanding the foregoing, if Executive’s employment is
terminated by reason of Executive’s notice of non-renewal and the Term expires
other than at the end of a full fiscal year of the Company, Executive shall
be
paid a pro rata portion of his performance bonus and a pro rata portion of
the
annual increment of his long-term cash incentive award that would otherwise
vest
for such year, if any, based on the number of months, including portions
thereof, during which Executive was employed during the fiscal year in which
his
employment was terminated, based on the performance of the Company for said
fiscal year as reflected in the Company’s financial statements for said fiscal
year. For avoidance of doubt, if the Term expires at the end of a fiscal
year
due to Executive’s notice of non-renewal, Executive would be entitled to the
full performance bonus payment and long-term cash incentive award otherwise
earned for such year.
(c) If
(1)
Executive’s
employment is terminated by reason of Executive’s death; (2) Executive’s
employment is terminated by the Company other than for Cause; (3) Executive’s
employment is terminated by the Executive for Good Reason; or (4) this Agreement
is terminated by reason of the Company’s notice of non-renewal, then Executive
shall be entitled to the following:
i. the
Company shall pay to Executive any unpaid base salary through the Date of
Termination and continue to pay Executive base salary through the end of
the
then-remaining Term of this Agreement (not less than a period of one year
after
the Date of Termination) at the rate in effect at the time Notice of Termination
is given, payable consistent with the Company’s regular payroll
practices;
ii. Executive
shall be entitled to any other compensation and benefits granted under this
Agreement (other than base salary and performance bonus which are addressed
in
subparagraphs (i), (iii) and (iv) respectively), for and through the end
of the
then-remaining Term of this Agreement (not less than a period of one year
after
the Date of Termination). Such benefits shall be determined in accordance
with
the Company’s employee benefit plans and other applicable programs, policies and
practices then in effect as though Executive was still then in the employ
of the
Company. The provisions of this Agreement, and any payment provided for
hereunder, shall not reduce any amounts otherwise payable, or in any way
diminish Executive’s existing rights, or rights which accrue solely as a result
of the passage of time under any benefit plan, employment agreement or other
contract, plan or arrangement;
iii. Executive
shall be entitled to receive his prorated performance bonus, if any, for
the
fiscal year in which (or at the end of
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which)
his employment was terminated, based on the performance of the Company for
said
fiscal year as reflected in the Company’s financial statements for said fiscal
year; and
iv. If
the
Date of Termination is prior to January 1, 2009, to the extent Executive’s
benefits under the long-term incentive award provided for in Section 6 have
not
yet vested at the Date of Termination, such benefit shall accelerate and
fully
vest.
(d) If
Executive’s employment is terminated by Executive by reason of Executive’s
Retirement, then Executive shall be entitled to receive the compensation
provided for in subsections 11(c)(i), (ii) and (iii), hereof, plus, if such
termination occurs prior to January 1, 2009, a pro rata portion of the annual
increment of his long-term cash incentive award that would otherwise vest
for
such year, if any, based on the number of months, including portions thereof,
during which Executive was employed during the fiscal year in which his
employment was terminated.
(e) In
the
event that compensation paid pursuant to Paragraph 11(c) (“Severance Pay”) is
subject to an excise tax pursuant to Section 4999 of the Internal Revenue
Code
of 1986 (“Excise Tax”), as amended, then Executive shall be entitled to receive
an additional Gross-Up Payment in an amount such that, after payment by
Executive of all taxes (and any interest or penalties imposed with respect
to
such taxes), including, without limitation, any income taxes (and any interest
and penalties imposed with respect thereto) and Excise Tax imposed upon the
Excise Tax imposed upon the Gross-Up Payment, Executive retains an amount
of the
Gross-Up Payment equal to the Excise Tax imposed upon the Severance Pay.
The
accounting firm employed by the Company shall make all determinations required
herein, including whether and when a Gross-Up Payment is required, the amount
of
any such Gross-Up Payment and the assumptions to be utilized in arriving
at such
determination (except that Executive’s federal and state income taxes shall be
assumed to be at the maximum rates). In the event that the accounting firm
is
serving as accountant or auditor to the individual, entity or group effecting
the Change of Control, unless otherwise in writing by Executive, Company
shall
appoint another independent accounting firm reasonably acceptable to Executive
to make the determinations required hereunder (which accounting firm shall
then
be referred to as the accounting firm hereunder). All fees and expenses of
the
accounting firm shall be borne solely by Company. The Gross-Up Payment shall
be
paid to Executive concurrently with the Severance Pay, unless Company at
the
same time as the payment of the Severance Pay provides Executive with the
accounting firm’s opinion that Executive will not incur any Excise Tax on any
part or all of the Severance Pay. Any such opinion shall be based upon the
regulations under Section 280G and 4999 of the Internal Revenue Code of 1986,
as
amended and shall qualify as a covered, limited scope opinion under Circular
230. If any such opinion applies only to part of the Severance Pay, Company
shall pay Executive the Gross-Up Payment with respect to that part of the
Severance Pay not covered by the
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opinion.
Executive agrees (unless requested otherwise by Company) to use reasonable
efforts to contest in good faith any subsequent determination by the Internal
Revenue Service that Executive owes an amount of Excise Tax greater than
the
amount determined above; provided, that Executive shall be entitled to
reimbursement by Company of all fees and expenses reasonable incurred by
Executive in contesting such determination. In the event the Internal Revenue
Service or any court of competent jurisdiction determines that Executive
owes an
amount of Excise Tax that is either greater or less than the amount previously
taken into account in the Gross-Up Payment herein, Company shall promptly
pay to
Executive, or Executive shall promptly repay to Company, as the case may
be, the
amount of resulting excess or shortage in the Gross-Up Payment. Any payment
Company is required to make to Executive pursuant to the preceding sentence
shall include an additional amount such that after payment by Executive of
all
of Executive’s applicable federal, state and local taxes on such additional
amount, Executive shall retain an amount equal to the total of Executive’s
applicable federal, state and local taxes arising due to the later payment.
If
Executive collects any part or all of the Severance Pay provided herein,
including the Gross-Up Payment, through a lawyer, Company shall pay all costs
of
any such collection or enforcement, including reasonable legal fees and other
out of pocket expenses incurred by the Executive, up to that point when company
offered to settle the dispute for an amount equal to the amount Executive
is
entitled to recover. The payment described herein shall be due Executive
regardless of any subsequent employment obtained by Executive.
12. Non-Compete;
Confidentiality.
(a) During
the Term hereof and for a period of two years after the Date of Termination
or
expiration of the Term of this Agreement, Executive shall not either on his
own
account, as a partner, joint venturer, employee, agent, salesman, officer,
director or stockholder of a corporation (other than a beneficial holder
of not
more than two percent (2%) of the outstanding voting stock of a company having
at least five hundred (500) holders of voting or economic interests) or
otherwise, directly or indirectly enter into or engage in any business
competitive with the business of the Company as such business exists on the
date
hereof (a “Competitive Business”) within any area where such business has been
conducted prior to the date of termination. Notwithstanding the foregoing
or
anything in any other agreement (written or oral) between the parties to
the
contrary, if Executive’s employment is terminated by the Company other than for
Cause, by Executive for Good Reason, or if this Agreement is terminated by
reason of the Company’s notice of non-renewal, then Executive shall only be
subject to the non-compete covenants set forth in this Section 12(a) for
as long
as the Company pays to Executive the salary and benefits set forth in this
Agreement.
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(b) Except
as
provided in the next two sentences, Executive covenants and agrees that all
information, knowledge or data of or pertaining to the Company or any of
its
Affiliates, or pertaining to any other Person with which they or any of them
may
do business during the Term and which is not generally known in the relevant
trade or industry (and whether relating to methods, merchandising, processes,
techniques, discoveries, pricing, sales practices, marketing or any other
proprietary matters) (the “Company Information”) shall be kept secret and
confidential at all times during and after the termination or expiration
of this
Agreement and shall not be used or divulged by him outside the scope of his
employment as contemplated by this Agreement, except as the Parent may otherwise
expressly authorize. In the event that Executive is requested in a judicial,
administrative or governmental proceeding to disclose any of the Company
Information, Executive will promptly so notify the Company so that the Company
may seek a protective order at the Company’s expense or other appropriate remedy
and/or waive compliance with this Agreement. If such protective order or
other
remedy is not obtained or the Company waives compliance with this Agreement
and
disclosure of any of the Company Information is required, Executive may furnish
the material so required to be furnished, but Executive will furnish only
that
portion of the Company Information which is legally required and will exercise
his best efforts to obtain a protective order or other reliable assurance
that
confidential treatment will be accorded the Company Information
furnished.
13. Non-Solicitation/No-Hire.
Executive agrees and acknowledges that the services of Executive pursuant
to
this Agreement are unique and extraordinary, and that the Company and its
Affiliates will be dependent upon Executive for the development and growth
of
their business and related functions. If Executive’s employment with the Company
is terminated for any reason, Executive agrees, for a period of two years
following the Date of Termination or expiration of the Term of this Agreement,
not to conduct or participate (directly or indirectly, including through
one or
more Affiliates) in:
(a) Hiring,
attempting to hire or assisting any other Person in hiring or attempting
to
hire, or inducing to leave the employ of the Company, any employee or officer
of
the Company, or any person who was an employee or officer of the Company
within
the six-month period prior to the Date of Termination or expiration of the
Term
of this Agreement; provided, however, that Executive may immediately seek
to
hire Xxxx Xxxxx, without violating this Agreement.
(b) Soliciting
the business on behalf of himself or any other person with respect to a
Competitive Business of the Company of either: (i) any vehicle dealers who
were
clients of the Company during the 12-month period prior to the Date of
Termination (a “Specific Client”); or (ii) any Person whose business Executive
(on behalf of the Company or otherwise) solicited by multiple contacts during
the six-month period prior to the Date of Termination (a “Specific Contact”);
or
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(c) Any
activity for any Specific Client or Specific Contact which is the same as
or
similar to those activities Executive performed for the Company during the
three-year period prior to the Date of Termination.
Executive
agrees that if Executive acts in violation of this Section, the number of
days
Executive is in such violation will be added to any periods of limitation
on
Executive’s activities specified herein. In addition, Executive agrees that
during the duration of this Agreement and during the period of limitation
on
Executive’s activities specified in this Section, Executive shall promptly
deliver a true and correct copy of this Agreement to any prospective employer
or
business partner of Executive.
14. Monies
Owed to the Company.
Upon
the termination of Executive’s employment with the Company, Executive hereby
authorizes the Company to deduct from Executive’s final wages or other monies
due to Executive all debts or financial obligations owed to the Company by
Executive.
15. Remedies.
Executive understands and agrees that the Company will be irreparably damaged
in
the event that Sections 12 or 13 of this Agreement are violated. Executive
agrees that the Company shall be entitled (in addition to any other remedy
to
which it may be entitled, at law or in equity) to an injunction to redress
breaches of such Sections of this Agreement and to specifically enforce the
terms and provisions thereof.
16. Successors
and Assigns.
This
Agreement is a personal contract, and the rights and interests of Executive
hereunder and under the awards and plans referred to herein may not be sold,
transferred, assigned, pledged, encumbered, or hypothecated by him, except
as
may be expressly permitted by the provisions of such awards or plans and
that
payments due Executive hereunder shall be payable to his heirs or fiduciaries
upon his death. Except as may be expressly provided otherwise herein, this
Agreement shall be binding upon the Company and inure to the benefit of the
Company and its Affiliates, and its successors and assigns, including (but
not
limited to) any corporation or other entity which may acquire all or
substantially all of the Company’s assets or business or into or with which the
Company or an Affiliate may be consolidated or merged.
17. Jurisdiction
and Governing Law.
Any
controversy or claim arising out of or relating to this Agreement, or any
breach
thereof shall be governed by and construed in accordance with the laws of
the
Commonwealth of Virginia, without giving effect to principles of conflicts
of
laws thereof.
18. Entire
Agreement.
This
Agreement, the Asset Purchase Agreement and the Operating Agreement contain
all
the understandings between the parties hereto pertaining to the matters referred
to herein, and supersede all undertakings and agreements, whether oral or
in
writing, previously entered into by them with respect thereto; Company and
Executive are not relying on any such prior agreements or understandings
in
entering into this Agreement. This agreement supersedes and restates the
Prior
Agreement in its entirety. No representations or warranties of any kind or
nature relating to the Company or any Affiliate or their respective businesses,
assets, liabilities, operations, future plans or prospects have been made
by or
on
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behalf
of
the Company or any Affiliate to Executive, nor have any representations or
warranties of any kind or nature been made by Executive to the Company or
any
Affiliate.
19. Amendment
or Modification, Waiver.
No
provision of this Agreement may be amended or waived unless such amendment
or
waiver is agreed to in writing, signed by Executive and by a duly authorized
officer of the Company. No waiver by any party hereto of any breach by another
party hereto of any condition or provision of this Agreement to be performed
by
such other party shall be deemed a waiver of a similar or dissimilar condition
or provision at the same time, any prior time or any subsequent
time.
20. Notices.
Any
notice to be given hereunder shall be in writing and delivered personally
or by
overnight courier or sent by registered or certified mail, postage prepaid,
return receipt requested, addressed to the party concerned at the address
indicated below or to such other address as such party may subsequently give
notice of hereunder in writing:
To:
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||
Xxxxxxx.
X. XxXxxxxx
0000
Xxxx Xxxxx Xxxxx
Xxxxxxxx
Xxxxx, Xxxxxxxx 00000
|
||
With
a copy to:
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||
Xx.
Xxxxxx X. Xxxxxx
Xxxxxxxx
Xxxxxx
000
Xxxxxxx Xxxx Xxxxxx
Xxxxxxxx
Xxxxx, Xxxxxxxx 00000-0000
Facsimile:
(000) 000-0000
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||
To:
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||
Coastal
Credit, L.L.C.
c/o
White River Capital, Inc.
0000
Xx Xxxxx
X.X.
Xxx 0000
Xxxxxx
Xxxxx Xx, XX 00000
Attention:
Xxxx X. Xxxxxxxxx III
Facsimile:
(000) 000-0000
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||
With
a copy to:
|
||
Xxxxxx
& Xxxxxxxxx LLP
00
X. Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx,
Xxxxxxx 00000
Attention:
Xxxx X. Xxx
Facsimile:
(000) 000-0000
|
12
Any
notice delivered personally shall be deemed given on the date delivered,
any
notice transmitted by fax machine shall be deemed delivered upon receipt
of
confirmation of fax transmission, any notice delivered by overnight courier
shall be deemed given the day after deposit with a courier, and any notice
sent
by registered or certified mail, postage prepaid, return receipt requested,
shall be deemed given three days after mailing.
21. Severability.
If any
provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder
of
this Agreement or the application of such provision to such person or
circumstances other than those to which it is so determined to be invalid
and
unenforceable, shall not be affected thereby, and each provision hereof shall
be
validated and shall be enforced to the fullest extent permitted by
law.
22. Survivorship.
The
respective rights and obligations of the parties hereunder shall survive
any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.
23. Headings.
All
descriptive headings of sections and paragraphs in this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed
by
reference to the heading of any section or paragraph.
24. Withholding
Taxes.
All
payments to Executive under this Agreement shall be reduced by any applicable
federal, state or city withholding taxes.
This
Agreement may be executed in counterparts, each of which shall be deemed
an
original and all of which together shall be one and the same
agreement.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement this
28th
day of
December, 2005, but effective as of the date first above written.
COASTAL
CREDIT, L.L.C.
|
||
By:
|
White
River Capital, Inc.
|
|
Its:
|
Sole
Member
|
|
By:
|
/s/
Xxxx X. Xxxxxxxxx, III
|
|
Xxxx
X. Xxxxxxxxx, III, Chief Executive Officer
|
||
/s/ Xxxxxxx X. XxXxxxxx | ||
Xxxxxxx
X. XxXxxxxx
|
13
EXHIBIT
A
TERMS
OF LONG TERM INCENTIVE CASH AWARD
Pursuant
to Section 6(c) of the accompanying Restated Employment Agreement (“Employment
Agreement”), the Company and Executive hereby agree to the following terms and
conditions of the long-term cash incentive award provided for
therein:
Definitions.
Unless otherwise defined herein, capitalized terms used herein have the
definitions given them in the Employment Agreement, except that “Fair Market
Value” has the meaning set forth in the White River Capital, Inc. 2005 Stock
Incentive Plan, as amended.
Grant
of Award.
Pursuant to the Employment Agreement the Company hereby grants to Executive
a
long-term cash incentive award based on the value of 100,000 shares of common
stock of White River Capital, Inc., vesting and payable only as provided
herein
and in the Employment Agreement. Subject to acceleration of vesting, or
forfeiture (in whole or in part), on the terms provided herein and the
Employment Agreement, this award shall vest in three equal installments,
as
follows:
l
|
the
value of 33,333.33 Shares shall vest on January 1, 2007
|
l
|
the
value of 33,333.33 Shares shall vest on January 1, 2008
|
l
|
the
value of 33,333.33 Shares shall vest on January 1, 2009
|
Each
of
January 1, 2007, January 1, 2008 and January 1, 2009 is a “Vesting Date”. On
each Vesting Date, Executive shall earn and become entitled to receive a
cash
payment from the Company equal to the value of 33,333.33 shares of White
River
Capital, Inc. common stock. The value of the portion of the award vesting
and
becoming subject to payment on the Vesting Date or any other applicable date
shall be determined based on the mean of the Fair Market Value of a share
of
White River Capital, Inc. common stock for the 20 trading days immediately
preceding the Vesting Date or other determination date.
Risk
of Forfeiture.
Subject
to the exceptions set forth in the Employment Agreement, summarized below,
any
unvested portion of this award shall be forfeited if Executive’s employment with
the Company terminates prior to the vesting of such Shares. The risk of
forfeiture of any portion of the award shall lapse upon vesting of such portion
of the award as provided herein. Notwithstanding the foregoing general rule,
vesting of this award may accelerate in whole or in part, in accordance with
the
Employment Agreement, as follows:
Under
Section 11(a) and (c), if Executive’s employment terminates due to death,
Disability, termination by the Company without Cause, termination by Executive
for Good Reason, or due to Company’s notice of non-renewal, any unvested portion
of the award shall immediately vest and the value thereof shall be determined
and become payable on such date.
Under
Section 11(b) and (d), if Executive’s employment terminates because of
Executive’s (i) non-renewal and the term of the Employment Agreement expires
other than at the end of a full fiscal year of the Company, or (ii) Retirement,
Executive shall be entitled to receive the value of that portion of the annual
vesting increment of the award that would otherwise vest for the full year
in
which termination occurs based on the number of months, including portions
thereof, during which Executive was employed during the fiscal year in which
his
employment was terminated.
No
Rights as a Stockholder.
The value of the award is determined by reference to the value of White River
common stock to provide for an incentive arrangement tied to the value of
the
consolidated enterprise toward which Executive is expected to contribute
substantially. But the award does not represent shares or the right to receive
shares of any entity at any time and, to the extent it becomes payable, shall
consist only of the obligation of the Company to pay cash to the executive.
Executive shall not be a shareholder by virtue of the award and shall have
no
rights to dividends and no voting rights by virtue of the award.
Non-Transferability
of Award.
Except as otherwise provided for in the Employment Agreement, this Award
may not
be sold, pledged, assigned, hypothecated, transferred, or disposed of in
any
manner other than by will or by the laws of descent and distribution. If
Executive transfers all or part of this Stock Award pursuant to the previous
sentence and if permitted by the Employment Agreement, then the terms of
this
Agreement, and the Employment Agreement shall apply to the transferee to
the
same extent as to the Executive.
Withholding
Tax.
The Company’s obligation to pay the award shall be subject to the satisfaction
of all applicable federal, state, and local income and employment tax
withholding requirements.
Successors.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their legal representatives, heirs, and permitted transferees,
successors and assigns.
DATED:
|
December
28, 2005
|
COASTAL
CREDIT L.L.C.
|
|||
/s/
Xxxxxxx X. XxXxxxxx
|
By:
|
White
River Capital, Inc.
|
|
Xxxxxxx
X. XxXxxxxx
|
Its:
|
Sole
Member
|
|
By:
|
/s/
Xxxx X. Xxxxxxxxx, III
|
||
Xxxx
X. Xxxxxxxxx, III
|
|||
Chief
Executive Officer
|