Exhibit 10.3
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated August 27, 2007, effective as of July 1,
2007, by and between FIRSTPLUS FINANCIAL GROUP, INC., a Nevada corporation with
its principal office at 000 X. Xxxx Xxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx
00000 (the "Company"), and XXXXXXX XXXXXXX, residing at 0000 X.X. 00xx Xxxxxx,
Xxxxx, Xxxxxxx 00000 (the "Employee").
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Employee for the period
provided in this Agreement and the Employee is willing to accept such employment
with the Company on a full-time basis, all in accordance with the terms and
conditions set forth below.
NOW, THEREFORE, for and in consideration of the premises hereof and
the mutual covenants contained herein, the parties hereto covenant and agree as
follows:
1. EMPLOYMENT.
(a) The Company hereby employs the Employee, and the Employee
hereby accepts such employment with the Company, for the period set forth in
Section 2 hereof, all upon the terms and conditions hereinafter set forth.
(b) The Employee affirms and represents that he is under no
obligation to any former employer or other party that is in any way inconsistent
with, or that imposes any restriction upon, the Employee's acceptance of
employment hereunder with the Company, the employment of the Employee by the
Company, or the Employee's undertakings under this Agreement.
2. TERM OF EMPLOYMENT.
(a) Unless earlier terminated as provided in this Agreement,
the term of the Employee's employment under this Agreement shall be for a period
beginning on the effective date hereof and ending on June 30, 2009 (the "Initial
Term").
(b) The term of the Employee's employment under this Agreement
shall be automatically renewed for additional one-year terms (each a "Renewal
Term") upon the expiration of the Initial Term or any Renewal Term unless the
Company or the Employee delivers to the other, at least 90 days prior to the
expiration of the Initial Term or the then current Renewal Term, as the case may
be, a written notice specifying that the term of the Employee's employment will
not be renewed at the end of the Initial Term or such Renewal Term, as the case
may be. The period from the date hereof until June 30, 2009 or, in the event
that the Employee's employment hereunder is earlier terminated as provided
herein or renewed as provided in this Section 2(b), such shorter or longer
period, as the case may be, is hereinafter called the "Employment Term."
3. DUTIES. The Employee shall be employed as Chief Financial
Officer, Vice President and Treasurer of the Company and shall faithfully and
competently perform such duties consistent with such position as the Board of
Directors of the Company shall from time to time determine. The Employee shall
perform his duties principally at the offices of the Company in Irving, Texas,
with such travel to such other locations from time to time as the Board of
Directors may reasonably prescribe. Except as may otherwise be approved in
advance by the Board of Directors of the Company, and except during vacation
periods and reasonable periods of absence due to sickness, personal injury or
other disability or non-profit public service activities, the Employee shall
devote his full time throughout the Employment Term to the services required of
him hereunder. The Employee shall render his business services exclusively to
the Company and its present and future subsidiaries (collectively, the
"FIRSTPLUS Companies") during the Employment Term and shall use his best
efforts, judgment and energy to improve and advance the business and interests
of the FIRSTPLUS Companies in a manner consistent with the duties of his
position.
4. COMPENSATION. As compensation for the complete and
satisfactory performance by the Employee of the services to be performed by him
hereunder during the Employment Term,
(a) the Company shall pay the Employee a base salary at the
annual rate of $145,000 (such amount, together with any increases thereto as may
be determined from time to time by the Board of Directors of the Company in its
discretion but subject to the provisions of this Agreement, being hereinafter
referred to as "Salary"). Any Salary payable hereunder shall be paid at regular
intervals in accordance with the Company's payroll practices from time to time
in effect; and
(b) the Company shall pay to the Employee such incentive
compensation and bonuses, if any, (i) as the Board of Directors in its absolute
discretion may determine to award the Employee, and (ii) to which the Employee
may become entitled pursuant to the terms of any incentive compensation or bonus
program, plan or agreement from time to time in effect and applicable to the
Employee.
5. OTHER BENEFITS. During the Employment Term, the Employee
shall:
(a) be eligible to participate in any medical and health plans
or other employee welfare benefit plans that may be provided by the Company for
its senior executive employees in accordance with the provisions of any such
plans, as the same may be in effect from time to time;
(b) be entitled to accrue three weeks' paid time off in
respect of each 12-month period during the term of his employment hereunder. The
Employee shall accrue paid time off at a rate of 1.25 days per month. The
Employee shall also be entitled to all paid holidays given by the Company to its
senior executive employees;
(c) be eligible for consideration by the Board of Directors of
the Company for awards of stock options under any stock option plan that may be
maintained by the Company for its and its subsidiaries' key employees, the
amount of shares with respect to which options may be granted to the Employee to
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be in the sole discretion of the Board of Directors of the Company or the
Compensation Committee thereof;
(d) be entitled to sick leave, sick pay and disability
benefits in accordance with any Company policy that may be applicable to senior
executive employees from time to time in effect;
(e) be entitled to reimbursement for all reasonable and
necessary out-of-pocket business expenses, incurred by the Employee in the
performance of his duties hereunder in accordance with the Company's
reimbursement policy from time to time in effect;
(f) be entitled to receive an automobile allowance of $350 per
month;
(g) be entitled to reimbursement for the actual cost of the
Employee's cellular telephone usage upon the Employee's presentment of
appropriate documentation thereof; and
(h) be entitled to coverage under directors' and officers'
liability insurance policies, if any, from time to time maintained by the
Company for its directors and officers subject to the terms and conditions of
the Indemnification Agreement of even date herewith by and between the Company
and the Employee.
6. CONFIDENTIAL INFORMATION. The Employee and the Company, as
applicable, hereby covenant, agree and acknowledge as follows:
(a) The Company hereby agrees to immediately provide the
Employee with access to unpublished and otherwise confidential information
("Confidential Information") both of a technical and non-technical nature,
relating to the business of the Company and any of its parents, subsidiaries,
divisions or affiliates, its actual or anticipated business, research or
development, its technology or the implementation or exploitation thereof,
including without limitation information Employee and others have collected,
obtained or created, information pertaining to customers, accounts, vendors,
prices, costs, materials, processes, codes, material results, technology, system
designs, system specifications, materials of construction, trade secrets and
equipment designs, including information disclosed to the Company by others
under agreements to hold such information confidential. Employee agrees to
observe all Company policies and procedures concerning such Confidential
Information.
(b) The Employee shall not disclose, use or make known for his
or another's benefit any Confidential Information or use such Confidential
Information in any way, except as is in the best interests of the FIRSTPLUS
Companies in the performance of the Employee's duties under this Agreement. The
Employee may disclose Confidential Information when required by a third party
and applicable law or judicial process, but only after providing (i) immediate
notice to the Company at any third party's request for such information, which
notice shall include the Employee's intent with respect to such request, and
(ii) sufficient opportunity for the Company to challenge or limit the scope of
the disclosure on behalf of the FIRSTPLUS Companies, the Employee or both.
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(c) Upon the request of the Company at any time, or upon
termination of his employment with the Company for any reason, the Employee
shall forthwith return to the Company all originals and copies of Confidential
Information in whatever form maintained (including, without limitation, computer
discs and other electronic media).
(d) The Employee will promptly disclose to the Company any
idea, invention, discovery, improvement, whether patentable or not, conceived or
made by the Employee alone or with others at any time during his employment. The
Employee agrees that the Company owns any idea, invention, discovery,
improvement, whether patentable or not, conceived or made by him alone or with
others at any time during his employment, and hereby assign and agree to assign
to the Company all rights the Employee has or may acquire therein and agrees to
execute any and all applications, assignments or other instruments relating
thereto which the Company deems necessary. These obligations shall continue
beyond the termination of the Employee's employment with respect to ideas,
inventions, discoveries and improvements and derivatives of such ideas,
inventions, discoveries and improvements, conceived or made during the
Employee's employment with the Company. The Employee understands that the
obligation to assign his inventions to the Company shall not apply to any
invention which is developed entirely on his own time without using any of the
Company's equipment, supplies, facilities, and/or Confidential Information
unless such invention (a) relates in any way to the business or to the current
or anticipated research or development of the Company, or (b) results in any way
from the Employee's work at the Company.
(e) The Employee will not assert any rights to any invention,
discovery, idea or improvement relating to the business of the Company or to his
duties hereunder as having been made or acquired by him prior to his work for
the Company, except for the matters, if any, described in Appendix A to this
Agreement.
(f) At the Company's request and expense, the Employee agrees
to assist in protecting the Company's right in any idea, discovery, invention,
improvement or copyright owned by him pursuant to 6(e) above, or to be assigned
to the Company pursuant to this Agreement. The Employee hereby appoints each
executive officer of the Company, acting severally, as his attorney-in-fact with
full power of substitution for him and in his name, place and xxxxx, in any and
all capacities, to execute any and all documents or other instruments in his
name and to take such other actions as may be necessary or advisable to effect
any such assignment to the Company. The Employee further agrees, that without in
any way limiting the rights of the Company under this Agreement, that any work
created by the Employee in the course of his employment shall be considered a
"work made for hire" created for the benefit of the Company to the extent it
could be considered as such.
(g) If the Company does not wish to retain ownership of any
such idea, discovery, invention or improvement, or copyright, and the Employee
wishes to use or develop same for his own benefit, the Employee will obtain the
Company's written permission before doing so.
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7. TERMINATION.
(a) The Employee's employment hereunder shall be terminated
upon the occurrence of any of the following:
(i) the death of the Employee;
(ii) the Employee's inability to perform his duties
on account of disability or incapacity for a period of 120 or more days, whether
or not consecutive, within any period of 12 consecutive months;
(iii) the Company giving written notice, at any time,
to the Employee that the Employee's employment is being terminated for
"cause" (as defined below); or
(iv) the Company giving written notice, at any time,
to the Employee that the Employee's employment is being terminated other than
pursuant to clause (i), (ii) or (iii) above.
The following actions, failures and events by or affecting the
Employee shall constitute "cause" for termination within the meaning of clause
(iii) above: (A) a conviction of the Employee of, or the entering of a plea of
NOLO CONTENDERE by the Employee with respect to, having committed a felony, (B)
use of controlled substances or alcohol in the workplace or outside of the
workplace in such a manner as impairs or prevents the performance of the
Employee's duties hereunder or endangers the Employee or any other employee of
the Company, (C) acts of dishonesty or moral turpitude by the Employee that are
detrimental to one or more of the FIRSTPLUS Companies, (D) acts or omissions by
the Employee that the Employee knew were likely to damage the business of one or
more of the FIRSTPLUS Companies, (E) willful and repeated failure of the
Employee to perform any material duties hereunder or gross negligence of the
Employee in the performance of such duties, or (F) failure by the Employee to
obey the reasonable and lawful orders and policies of the Board of Directors
that are consistent with the provisions of this Agreement (provided that, in the
case of a conviction described in clause (A) above, and in the case of clause
(B), (C), (D) or (E) above, the Employee shall have received written notice of
such proposed termination and a reasonable opportunity to discuss the matter
with the Board of Directors of the Company, followed by written notice that the
Board of Directors of the Company adheres to its position.
(b) Notwithstanding anything to the contrary expressed or
implied herein, except as required by applicable law, the FIRSTPLUS Companies
shall not be obligated to make any payments to the Employee or on his behalf of
whatever kind or nature by reason of the termination of the Employment Term (i)
by the Employee (except in the case of the breach of this Agreement by the
Company) or (ii) pursuant to clause (i), (ii) or (iii) of Section 7(a) above,
other than such amounts, if any, that may be then otherwise payable to the
Employee pursuant to the terms of the Company's benefits plans or pursuant to
Section 5(e) hereof.
(c) If the Company terminates Employee's employment hereunder
pursuant to clause (iv) of Section 7(a), whether during the Initial Term or
during any Renewal Term, subject to and in exchange for the execution by the
Employee of a release absolving the Company of any further liability to the
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Employee hereunder, the Company shall pay to the Employee in six equal monthly
installments, on the date in each month corresponding with the date of
termination, commencing with the month following termination and continuing for
five additional consecutive months thereafter, as severance pay, an amount equal
to one twelfth (1/12th) of the sum of (x) the Employee's annual Salary in effect
immediately prior to such termination, and (y) the amount of incentive
compensation and bonuses, if any, paid to the Employee in respect of the most
recent fiscal year of the Company preceding such termination. In any such event,
the Company, at its own expense, shall provide the Employee with six months of
continuation of medical and health benefits pursuant to COBRA (subject to the
Employee's eligibility and timely election of such benefits). The provisions of
this Section 7(c) shall not be applicable to the termination of the Employee's
employment at the end of the Initial Term or any Renewal Term.
(d) In the event of the death of the Employee at any time when
he is entitled to receive payments under Sections 7(c) hereof, such payments
shall be made to the estate of the Employee or if the Employee has designated a
beneficiary to receive such payments under Section 7 hereof, to such
beneficiary.
(e) No interest shall accrue on or be paid with respect to any
portion of any payments hereunder.
(f) Employee shall have no duty to mitigate any damages that
he may incur by reason of termination of employment under the circumstances
described in Section 7(c) and shall be entitled to receive the amounts provided
in Section 7(c) regardless of any income that he may receive from other sources
following the date he becomes entitled to receive such amounts.
(g) Neither this Agreement nor any right or interest hereunder
shall be assignable by the Employee or his beneficiaries or legal
representatives without the Company's prior written consent; provided, however,
that nothing in this Section 7 shall preclude the Employee from designating a
beneficiary to receive any benefit payable hereunder upon his death or
incapacity.
(h) Except as required by law, no right to receive payments
under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion,
attachment, levy or similar process or to assignment by operation of law, and
any attempt, voluntary or involuntary, to effect any such action shall be null,
void and of no effect.
8. RESTRICTIVE COVENANTS.
(a) During the Employment Term and, in the event that the
Employee's employment is terminated for any reason (including the non-renewal of
this Agreement in accordance with Section 2(b) above), during the 18-month
period following such termination, the Employee will not directly or indirectly
(as a director, officer, executive employee, manager, consultant, independent
contractor, advisor or otherwise) engage in competition with, or own any
interest in, perform any services for, participate in or be connected with any
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business or organization that engages in competition with any of the FIRSTPLUS
Companies within the meaning of Section 8(d), provided, however, that the
provisions of this Section 8(a) shall not be deemed to prohibit the Employee's
ownership of not more than 2% of the total shares of all classes of stock
outstanding of any publicly held company.
(b) In the event that the Employee's employment is terminated
for any reason (including the non-renewal of this Agreement in accordance with
Section 2(b) above), during the 18-month period following such termination, the
Employee will not directly or indirectly hire, solicit, retain, compensate or
otherwise induce or attempt to induce any person who is and/or was an employee
of any of the FIRSTPLUS Companies at any time during the six months prior to the
Employee's termination, to leave the employ of the FIRSTPLUS Companies, or in
any way interfere with the relationship between any of the FIRSTPLUS Companies
and any employee thereof.
(c) During the Employment Term and, in the event that the
Employee's employment is terminated for any reason (including the non-renewal of
this Agreement in accordance with Section 2(b) above), during the 18-month
period following such termination, the Employee will not directly or indirectly
hire, engage, send any work to, place orders with, or in any manner be
associated with any supplier, contractor, subcontractor or other business
relation of any of the FIRSTPLUS Companies if such action by the Employee would
have a material adverse effect on the business, assets or financial condition of
any of the FIRSTPLUS Companies, or materially interfere with the relationship
between any such person or entity and any of the FIRSTPLUS Companies.
(d) For all purposes in this Section 8, a person or entity
(including without limitation, the Employee) shall be deemed to be a competitor
of or engaging in competition with one or more of the FIRSTPLUS Companies, if
such person or entity engages in any business competing with, or substantially
similar to, the businesses of one or more of the FIRSTPLUS Companies, as such
businesses exist at the time of termination of the Employee's employment with
the Company in any state of the United States of America in which any of the
FIRSTPLUS Companies conduct, or are actively investigating the possibility of
conducting, their businesses at the time of such termination. The provisions of
this Section 8 shall cease to be applicable to any state in which the FIRSTPLUS
Companies are actively investigating the possibility of conducting their
businesses at the time of termination of Employee's employment with the Company,
unless within three months after such termination, the FIRSTPLUS Companies, or
any of them, have commenced soliciting prospective customers in such state, and
have effectuated either of the following: (i) the opening of an office in such
state; or (ii) the hiring of one or more employees to be employed in such state
or the assignment of one or more incumbent employees to solicit business in such
state.
(e) In connection with the foregoing provisions of this
Section 8, the Employee represents that his experience, capabilities and
circumstances are such that such provisions will not prevent him from earning a
livelihood. The Employee further agrees that the limitations set forth in this
Section 8 (including, without limitation, time limitations) are reasonable and
properly required for the adequate protection of the current and future
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businesses of the FIRSTPLUS Companies. It is understood that the covenants made
by the Employee in this Section 8 (and in Section 6 hereof) shall survive the
expiration or termination of this Agreement.
9. LEGITIMATE BUSINESS INTERESTS OF THE FIRSTPLUS COMPANIES.
(a) The parties hereto acknowledge and agree that the matters
set forth above in Sections 6 and 8 constitute the legitimate business interests
of the FIRSTPLUS Companies and are hereby conclusively agreed to be legally
sufficient to support such covenants. Such legitimate business interests include
but are not necessarily limited to trade secrets; valuable confidential business
or professional information that does not legally qualify as trade secrets;
substantial relationships with specific prospective or existing customers or
clients; customer or client good will associated with an ongoing business in a
specific geographic location and a specific marketing area; and extraordinary or
specialized training. It is further acknowledged and agreed that all such
restrictive covenants set forth above are reasonably necessary to protect the
legitimate business interests of the FIRSTPLUS Companies and are not overbroad
or unreasonable. It is acknowledged and agreed that the Company is specifically
relying upon the foregoing statements in entering into this Agreement.
(b) The Employee acknowledges that a remedy at law for any
breach or threatened breach of the provisions of Sections 6 or 8 hereof would be
inadequate, that the FIRSTPLUS Companies would be irreparably injured by such
breach and that, therefore, the FIRSTPLUS Companies shall be entitled to
injunctive relief in addition to any other available rights and remedies in case
of any such breach or threatened breach.
10. BINDING EFFECT. Without limiting or diminishing the effect of
Section 7 hereof, this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective heirs, successors, legal
representatives and assigns.
11. NOTICES. All notices that are required or may be given
pursuant to the terms of this Agreement shall be in writing and shall be
sufficient in all respects if given in writing and (i) delivered personally,
(ii) mailed by certified or registered mail, return receipt requested and
postage prepaid, or (iii) sent via a responsible overnight courier, to the
parties at their respective addresses set forth above, or to such other address
or addresses as either party shall have designated in writing to the other party
hereto. The date of the giving of such notices delivered personally or by
carrier shall be the date of their delivery and the date of giving of such
notices by certified or registered mail shall be the date five days after the
posting of the mail.
12. LAW GOVERNING. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, except that body of
law relating to choice of laws.
13. SEVERABILITY. In the event that any court of competent
jurisdiction shall finally hold that any provision of Section 6 or 8 hereof is
void or constitutes an unreasonable restriction against the Employee, Section 6
or 8, as the case may be, shall not be rendered void, but shall apply with
respect to such extent as such court may judicially determine constitutes a
reasonable restriction under the circumstances, and, in such connection, the
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parties hereto authorize any such court to modify or sever any such provision,
including without limitation, any such provision relating to duration and
geographical area, to the extent deemed necessary or appropriate by such court.
If any part of this Agreement other than Section 6 or 8 is held by a court of
competent jurisdiction to be invalid, illegal or incapable of being enforced in
whole or in part by reason of any rule of law or public policy, such part shall
be deemed to be severed from the remainder of this Agreement for the purpose
only of the particular legal proceedings in question and all other covenants and
provisions of this Agreement shall in every other respect continue in full force
and effect and no covenant or provision shall be deemed dependent upon any other
covenant or provision.
14. WAIVER. Failure to insist upon strict compliance with any of the
terms, covenants or conditions hereof shall not be deemed a waiver of such term,
covenant or condition, nor shall any waiver or relinquishment of any right or
power hereunder at any one or more times be deemed a waiver or relinquishment of
such right or power at any other time or times.
15. ENTIRE AGREEMENT; MODIFICATIONS. This Agreement constitutes the
entire agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements, oral and written, between the parties hereto
with respect to the subject matter hereof. This Agreement may be modified or
amended only by an instrument in writing signed by both parties hereto.
16. SURVIVAL OF PROVISIONS. Neither the termination of this
Agreement, nor of Executive's employment hereunder, shall terminate or affect in
any manner any provision of this Agreement that is intended by its terms to
survive such termination, including without limitation, the provisions of
Sections 4 to 8 inclusive and Section 11 hereof.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Employee have duly executed
and delivered this Agreement, as of the day and year first above written.
FIRSTPLUS FINANCIAL GROUP, INC.
By: /s/ Xxxx Xxxxxxx
---------------------------
Name: Xxxx Xxxxxxx
Title: President and Chief Executive Officer
/s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
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APPENDIX A
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