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EXHIBIT 10.83
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of
this 29th day of June, 1998, by and between DORAL FINANCIAL CORPORATION, a
Puerto Rico corporation (which, together with any successor thereto, is
hereinafter referred to as the "Company") and XXXXXXXXX X. XXXXXX (the
"Employee").
WHEREAS, the Company believes that it is in the best interests of such
entity to enter into this Agreement with the Employee in order to assure the
services of an executive with the experience and abilities of the Employee; and
WHEREAS, the Board of Directors of the Company has authorized
the execution of this Agreement with the Employee;
NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements of the parties herein contained, it is agreed as
follows:
1. Employment. (a) The Employee is hereby employed as Executive Vice
President of the Company. The Employee shall have such other powers and duties
as may from time to time may be prescribed by the Chief Executive Officer or
President of the Company, including, but not limited to, the development of new
business, the integration of the mortgage banking activities and other banking
activities of the Company's subsidiaries and affiliates, supervising and
coordinating such entities' human resources, acting as liaison between the
Company and its subsidiaries and affiliates located in the continental Unites
States. In the performance of such duties the Employee shall report to the Chief
Executive Officer of the Company or to such other person as may be designated by
the Chief Executive Officer.
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(b) To the extent requested to do so by the Chief Executive
Officer of the Company, the Employee also agrees to serve as officer of any
other subsidiary or affiliate of the Company.
(c) The Employee shall devote his best efforts and
substantially all business time and attention to the business and affairs of the
Company and its subsidiaries and affiliated companies.
2. Competitive Activities.
(a) The Employee agrees that during the term of his employment
hereunder, except with the express consent of the Chief Executive Officer or
Board of Directors of the Company, he will not, directly or indirectly, engage
or participate in, become a director of, accept employment from, or render
advisory or other services for, or in connection with, or become interested in,
or make any financial investment in any firm, corporation, business entity or
business enterprise competitive with any business of the Company or any
subsidiary or affiliate thereof; provided, however, that the Employee shall not
thereby be precluded or prohibited from owning passive investments, including
investments in the securities of other financial institutions, so long as such
ownership does not require him to devote substantial time to the management or
control of the business or activities in which he has invested.
(b) The Employee agrees and acknowledges that, by virtue of
his employment hereunder, he will maintain an intimate knowledge of the
activities and affairs of the Company and its subsidiaries and, including trade
secrets and other confidential matters. As a result, and also because of the
special, unique and extraordinary services that the Employee is capable of
performing for the Company and its subsidiaries or their competitors, the
Employee recognizes that the services to be rendered by him hereunder are of a
character
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giving them a peculiar value, the loss of which cannot be adequately or
reasonably compensated for by damages. The Employee therefore agrees that if he
fails to render to the Company any of the services required hereunder, the
Company shall be entitled to immediate injunctive or other equitable relief to
restrain the Employee from failing to render his services hereunder or from
revealing any such confidential information to third parties, in addition to any
other remedies to which the Company may be entitled under law.
(c) Employee agrees, for a period of one year from the
termination of his employment with the Company or any subsidiary or affiliates
thereof, not to recruit or solicit any employee of the Company or any of its
subsidiaries or affiliates to engage in a business or employment relationship
with any other corporation or organization is engaged in the business of
originating, purchasing, or funding mortgage, commercial, industrial and
personal loans, or any other line of business in which the Company or its
subsidiaries or affiliates is involved or of which are aware has developed an
interest.
3. Compensation.
(a) Salary. During the term of this Agreement, the Employee
shall be entitled to an annual salary equal to $125,000. The Employee's salary
shall be payable not less frequently than bi-weekly. Any adjustments in salary
or other compensation shall in no way limit or reduce any other obligation of
the Company hereunder. The Employee's salary in effect hereunder from time to
time shall not thereafter be reduced.
(b) Bonus. During the term of this Agreement, the Employee
shall also be entitled to receive an annual bonus equal to $50,000, payable
bi-monthly.
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(c) Discretionary Year-End Bonus. The Employee may also
receive an additional year-end bonus at the sole discretion of the Board of
Directors of the Company, for performance which in the opinion of the Board of
Directors of the Company is of an outstanding nature.
(d) Discretionary Participation. The Employee may also be
offered the opportunity to participate in the stock-option plan or other
compensation plan of the Company at the sole discretion of the Board of
Directors of the Company.
(e) Discretionary Paid Vacation. The Employee may also receive
additional compensation in the form of a one-week vacation with all expenses
paid by the Company, completely at the discretion of the Board of Directors of
the Company, for performance which in the opinion of the Board of Directors of
the Company is of an outstanding nature.
(f) Automobile. The Company will provide the Employee with the
use of an automobile for use in the affairs and business of the Company as well
as an allowance for gasoline, insurance and parking, in accordance with
Company's then existing policy for executive officers.
(g) Expenses. During the term of his employment here under,
the Employee shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by him in performing services hereunder, provided
that the Employee properly accounts therefor in accordance with the then
existing policy of the Company. Nothing contained herein shall authorize the
Employee to make any political contributions, including but not limited to
payments for dinners and advertising in any political party program or any other
payment to any person, which might be deemed a bribe, kick-back or otherwise
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an improper payment or contribution under existing law or under the Company's
policy or practice and no portion of the compensation payable hereunder is for
such purpose.
(h) Withholding. Payments of any compensation under this
Agreement shall be subject to reduction by the amount of any applicable federal,
Commonwealth of Puerto Rico, state or municipal income, withholding, social
security, state disability insurance or similar or other taxes or other items
which may be required or authorized to be deducted by law or custom.
(i) No additional Compensation. No additional compensa tion
shall be due to Employee for services performed of offices held in any other
subsidiary, division, affiliate, or venture of the Company.
4. Medical, Dental, Life Insurance and Disability Coverage. During the
term of this Agreement, the Company shall provide coverage to the Employee under
the Company's existing medical, dental, life insurance and disability plans or
pay to provide coverage under separate medical, dental, life insurance and
disability plans.
5. Term. The term of employment under this Agreement shall be a period
of approximately one year commencing on June 29, 1998 (the "Commencement Date")
and ending on June 20, 1999, subject to earlier termination as provided herein,
or to the extension of the term by mutual agreement of the parties.
6. Vacations. The Employee shall be entitled, without loss of pay, to
absent himself voluntarily from the performance of his employment under this
Agreement, all such voluntary absences to count as vacation time, provided that:
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(a) During each twelve-month period of employment under this
Agreement, the Employee shall be entitled to paid vacation equivalent to 15
working days to be taken in accordance with the plans, policies, programs or
practices of the Company as in effect from time to time; and
(b) The timing of vacations shall be scheduled in a reasonable
manner by the Employee subject to approval by the Chief Executive Officer of the
Company.
7. [RESERVED]
8. Termination of Employment; Death.
(a) The Company may terminate the Employee's employment at any
time, but any termination by the Company other than termination for cause, shall
not prejudice the Employee's right to compensation or other benefits under this
Agreement. If the employment of the Employee is involuntarily terminated, other
than for "cause" as provided in this Section 8(a) or by reason of death or
disability as provided in Sections 8(c) or 9, the Company shall pay the Employee
his salary (but not any incentive bonus) and provide to the Employee the same
insurance benefits as he was receiving before the date of termination through
the remaining term of this Agreement.
The terms "termination" or "involuntarily terminated"
in this Agreement shall refer to the termination of the employment of Employee
without his express written consent.
In case of termination of the Employee's employment
for cause, the Company shall pay the Employee his salary through the
date of termination, and the Company shall have no further obligation
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to the Employee under this Agreement. For purposes of this Agreement,
termination for "cause" shall include termination for personal dishonesty,
incompetence, willful misconduct, breach of a fiduciary duty, insubordination,
failure to perform stated duties or failure to maintain the Chief Executive
Officer of the Company (and/or such other person as may be designated by the
Chief Executive Officer) informed of the progress of Employee's fulfillment of
its stated duties and of any material event arising in connection therewith,
willful violation of any law, rule, or regulation (other than traffic violations
or similar minor offenses) or final cease-and-desist order, or material breach
of any provision of this Agreement.
(b) (i) The Employee's employment may be terminated by the
Employee upon a failure of the Company to comply with any material provision of
this Agreement, which failure has not been cured within ten (10) days after a
notice pursuant to Section 11 of such non-compliance has been given by the
Employee to the Company.
(ii) In the event of the death of the Employee during
the term of employment under this Agreement and prior to any termina tion
hereunder, the Employee's estate, or such person as the Employee may have
previously designated in writing, shall be entitled to receive from the Company
the salary of the Employee through the last day of the calendar month in which
his death shall have occurred, and the term of employment under this Agreement
shall end on such last day of the month.
9. Disability. If the Employee shall become disabled as defined in the
Company's then current disability plan or if the Employee shall be otherwise
physically unable to serve, the Employee shall be entitled to receive group and
other disability income benefits of the type then provided by the Company for
other executive
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employees of the Company employed, in the continental United States, if any.
However, the Company shall be obligated to pay the Employee's compensation
pursuant to Section 3(a) hereof only to the extent the Employee's salary would
exceed the disability income benefits received pursuant to this Section. In
addition, the Company shall have the right, upon resolution of its Board of
Directors, to discontinue paying cash compensation pursuant to Section 3(a)
beginning six months following a determination that the Employee qualifies for
the foregoing disability income benefits. The Company shall have no obligation
to pay any incentive bonus pursuant to Section 3(b) for any period during which
the Employee is disabled.
10. No Assignments. (a) This Agreement is personal to each of the
parties hereof, and neither party may assign or delegate any of its rights or
obligations hereunder without first obtaining the written consent of the other
party; provided, however, that (i) the Company may assign its rights hereunder
to its parent company or any other subsidiary or affiliate and (ii) if the
Company merges or consolidates into another entity controlled by it or any
affiliate of any of the Company, or enters into a reorganization transaction in
which the shareholder of the Company immediately prior to any such transaction
become the shareholders of the resulting entity, then this Agreement maybe
transferred to such resulting entity.
(b) This Agreement and all rights of the Employee hereunder
shall inure to the benefit of and be enforceable by the Employee's personal and
legal representatives, executors, adminis trators, successors, heirs,
distributees, devisees and legatees. If the Employee should die while any
amounts would still be payable to the Employee hereunder if the Employee had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to the Employee's
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devisee, legatee or other designee or if there is no such designee,
to the Employee's estate.
11. Notice. For the purposes of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when personally delivered or sent by certified
mail, return receipt requested, postage prepaid, addressed to the last known
respective address of the party hereto (provided that all notices to the Company
shall be directed to the attention of the Chief Executive Officer of the Company
with a copy to the Secretary of such entity), or to such other address as either
party may have furnished to the other in writing in accordance herewith.
12. Amendments. No amendments or additions to this Agreement shall be
binding unless in writing and signed by both parties, except as herein otherwise
provided.
13. Paragraph Headings. The paragraph headings used in this Agreement
are included solely for convenience of reference and shall not affect, or be
used in connection with, the interpretation of this Agreement.
14. Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or unenforceability of the other provisions hereof.
15. Governing Law. This Agreement shall be governed by the laws of the
Commonwealth of Puerto Rico.
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16. Other Matters. (a) Except as provided in Section 10(b), any amounts
payable hereunder are personal to the Employee and are not transferable or
assignable either by the Employee's act or by operation of law, and no assignee,
trustee in bankruptcy, receiver or other party whomsoever shall have any right
to demand any such amounts or any other right with respect thereto.
(b) If and when questions arise from time to time as to the
intent, meaning or application of any one or more of the provisions hereof, such
questions will be decided by the Board of Directors of the Company or any
committee appointed to consider such matters, or, in the event the Company is
merged into or consolidated with any other corporation, by the Board of
Directors (or a committee appointed by it) of the surviving or resulting
corporation, and the decision of such Board of Directors or committee, as the
case may be, as to what is a fair and equitable settlement of each such question
or as to what is a fair and proper interpretation of any provision hereof or
thereof shall be conclusive and binding up. The Employee understands that
payment of any amounts hereunder, including any bonus, is not held or set aside
in trust and that (1) the Company may seek to retain, offset, attach or
similarly place a lien on such funds in circumstances where the Employee has
been discharged for cause and, in addition, shall be entitled to do so for (x)
malfea sance damaging to the Company, (y) conversion by the Employee of an
opportunity of the Company, or (z) a violation of the Company's conflict of
interest policy, in each case as determined in the sole discretion of the
Company's Board of Directors and (2) in the event the Company is unable to make
any payment under this Agreement because of receivership, insolvency, bankruptcy
or similar status or proceedings, the Employee will be treated as a general
unsecured creditor of the Company and may be entitled to no priority under
applicable law with respect to such payments.
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17. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
San Xxxx, Puerto Rico, in accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award in
any court having juris diction.
18. Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
SECTION 17 OF THIS AGREEMENT CONTAINS A BINDING ARBITRATION
PROVISION WHICH MAY BE ENFORCED BY THE PARTIES.
DORAL FINANCIAL CORPORATION
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Chief Executive Officer
/s/ Xxxxxxxxx X. Xxxxxx
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Xxxxxxxxx X. Xxxxxx
