EXHIBIT 10.06
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EMPLOYMENT AGREEMENT
AGREEMENT by and between ICON Capital Corp., a corporation organized
and existing under the laws of the State of Connecticut (the "Company"), and
Xxxxxx Xxxxxx (the "Employee"), dated as of August 20, 1996.
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Pursuant to a certain Stock Purchase Agreement between ICON Holding
Corp. and Xxxxx X. Xxxxxxx, Xxxxxx X. XxXxxxx and Xxxxxxx Xxxxxx dated as of
August 20, 1996 (the "Purchase Agreement"), the stock of the Company has been
sold to ICON Holdings Corp. and, in order to obtain Employee's services
following the closing of the Purchase Agreement, the Company and Employee have
each decided to enter into this Employment Agreement.
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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 24 months
("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.
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(a) Position and Duties.
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(i) Commencing on the Effective Date and for the
remainder of the Employment Period, the Employee shall be engaged as
an Executive Vice President of the Company with an office located
initially at 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx before opening
an office in the greater Boston area. Employee will report to the
Chief Executive Officer of the Company and shall have such duties,
responsibilities and authority as shall be consistent therewith and as
the Chief Executive Officer 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, except as noted in Section 2(b)(x) 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,
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the Employee shall receive a base salary ("Base Salary") at a rate of
$100,000 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) Annual Bonus. In addition to Base Salary, the
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Employee shall receive, for each fiscal year ending during the
Employment Period, an annual bonus (the "Annual Bonus") as set forth
in Exhibit A. Unless the Employee shall elect to defer the receipt of
any part of the Annual Bonus, each such payment shall be paid
promptly, but in no event more than thirty (30) days, after the
Company's receipt of the audited financial statements of the Company
for the fiscal year or, as the case may be, preparation of the
Company's monthly management accounts for the relevant period. The
Employee may elect to receive a draw against the Annual Bonus up to
$40,000.00 to be paid out monthly in twelve equal installments.
(iii) 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;
(iv) Welfare Benefit Plans. During the Employment Period,
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the 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-term disability, salary continuance, em
ployee life, group life, accidental death and travel accident
insurance plans and programs, if any);
(v) Expenses. During the Employment Period, the Employee
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shall be entitled to receive prompt reimbursement for all reasonable
expenses incurred by the Employee in the performance of his duties
hereunder;
(vi) Vacation. The Employee shall be entitled to at least
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four
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weeks annual paid vacation during the Employment Period. Unused
vacation shall be carried forward without limitation;
(vii) Payment Schedule. Base Salary shall be paid in
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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; and
(viii) Automobile. The Employee will be entitled to an
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automobile which will be leased and paid for by the Company (including
insurance, maintenance and normal operating costs, including all fuel
costs) and provided to the Employee during the Employment Period. The
Employee may chose the make and model of the automobile so long as the
monthly lease payment does not exceed $750 per month on a three year
contract.
(ix) Industry Participation. The Employee shall be
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encouraged to actively participate in ELA and IAFP including
reasonable attendance at annual meetings and other important events at
the Company's expense.
3. Termination of Employment.
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(a) Death or Disability. The Employee's employment shall
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terminate 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, intentional failure to perform those duties stated in
Section 2(a)(i) under this Agreement, 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
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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 or any
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Employee Termination shall be communicated by Notice of Termination to the other
party hereto given 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 contrary,
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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, 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 and Annual Bonus and any other forms of compensation yet unpaid
under this Agreement up to the date of expiration of the Initial Period or six
months Base Salary, whichever is the greater, (B) any compensation previously
deferred by the Employee, (C) any accrued vacation pay, and (D) any Annual
Bonus determined in accordance with Exhibit A.
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(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 terminates employment during the Employment Period, this
Agreement shall terminate without further obligations to the Employee.
5. Non-Competition. During the Employment Period and, except in the
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event of an Employee Termination for a period of six (6) 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
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termination of employment. As used herein, Confidential Information shall mean
information known to or obtained by Employee prior to the Closing under the
Purchase Agreement or thereafter 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.
7. Specific Performance. The Employee acknowledges that the covenants of
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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 inure 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.
9. Miscellaneous.
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(a) The laws of the State of New York 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:
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(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 AA4. 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.
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.
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Xxxxxx Xxxxxx
ICON Capital Corp.
By:
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If to the Employee:
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Xxxxxx X. Xxxxxx
00 Xxxxxxxxxx Xxxxx
Xxxxx, Xxxxxxxxxxxxx 00000
If to the Company:
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ICON Capital Corp.
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx
Attention: President
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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.
(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 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 formally 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.
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Exhibit A to Employment Agreement with Xxxxxx Xxxxxx
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Profit Sharing Plan
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1. Period to March 31, 1997: The Annual Bonus for the Employee shall be
computed by multiplying 0.25% against the total amount of equity raised by the
Company under the Series 7 Fund, or any other partnership offering or substitute
thereof by the Company during the period commencing on May 1, 1996 and ending on
March 31, 1997 or, if earlier, the date on which the Employment Period ends.
Notwithstanding the above, should Employee assume the role of National
Sales Manager then the bonus multiple will increase from 0.25% to 0.50% upon
appointment.
2. Fiscal years commencing on and after April 1, 1997:
(a) Unless Employee has assumed the role of National Sales Manager
the following shall apply:
(b) The Annual Bonus for each fiscal year of the Company commencing
on or after April 1, 1997 shall be computed in accordance with the non-qualified
profit sharing plan in effect for the time being for certain executive employees
of the Company (the "Plan"). The Plan shall be based upon the Company's earnings
before income tax for the relevant fiscal year. The following principles shall
be applied in formulating the Plan:
(i) the Employee shall be consulted and shall participate
in the formulation of the Plan including the process of setting the
Company's budget and targeted earnings before income taxes;
(ii) for the purposes of the Plan, payments to the
Company's stockholders or affiliates in excess of the amounts budgeted
for the relevant fiscal year shall be discounted;
(c) If the Employment Period ends other than at the end of the
Company's fiscal year, Annual Bonus shall be based on the Company's earnings
before income tax disclosed in management amounts for the period ending of the
last day of the calendar month prior to that in which the Employment Period
ends.
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