EXHIBIT 10.48
EMPLOYMENT AGREEMENT
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This Employment Agreement ("Agreement") is effective as of January 1, 1999 (the
"Effective Date") between New Century Mortgage Corporation, a California
corporation (the "Company"), and Xxxxxxx Xxxxxxxx (the "Executive"). In
consideration of the mutual covenants and agreements set forth herein, the
parties hereto agree as follows:
ARTICLE I
EMPLOYMENT
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The Company hereby employs Executive and Executive accepts employment with
the Company upon the terms and conditions herein set forth.
1.1 Employment. The Company hereby employs Executive, and Executive
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agrees to serve, as the Company's Executive Vice President and Chief Operating
Officer during the term of this Agreement. Executive agrees to perform such
duties as may be assigned to Executive from time to time by the Company.
Executive agrees to devote substantially his full business time and attention
and best efforts to the affairs of the Company during the term of this
Agreement.
1.2 Term. The term of employment of Executive hereunder will be for the
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period commencing on the Effective Date and ending on the earliest of:
(a) December 31, 1999;
(b) The date of termination of Executive's employment in accordance
with Article IV of this Agreement;
(c) The date of Executive's voluntary retirement in accordance with
the Company's plans and policies; or
(d) The date of Executive's death.
Unless this Agreement is terminated pursuant to Paragraphs (b), (c) or (d)
above, the term of this Agreement shall be extended automatically for successive
one year periods, unless and until at least three months written notice is given
by either party requesting termination or renegotiation of this Agreement prior
to the expiration of its term or any one year extension thereof.
ARTICLE II
COMPENSATION
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2.1 Base Salary. During the employment of Executive, the Company shall
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pay to the Executive a base salary at the rate of $230,000 per year during 1999,
and thereafter at a rate determined by the Company's Board of Directors (the
"Base Salary"), but no less than the rate
paid during 1999. The Base Salary shall be payable in substantially equal semi-
monthly installments.
2.2 Profit Sharing and Bonuses. Executive shall be eligible to
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participate in a Bonus Plan (the "Plan") as established and modified by the
Board of Directors from time to time, the initial terms of which are described
in Exhibit A hereto.
2.3 Reimbursement of Expenses. The Executive shall be entitled to receive
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prompt reimbursement of all reasonable expenses incurred by the Executive in
performing services hereunder, including all expenses of travel, living expenses
while away from home on business at the request of, or in the service of, the
Company, provided that such expenses are incurred and accounted for in
accordance with the policies and procedures established by the Company.
2.4 Automobile Expenses. The Company shall provide Executive with an
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automobile allowance of $1,000.00 per month.
2.5 Benefits. The Executive shall be entitled to participate in and be
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covered by all health, insurance, pension, disability insurance, physical exam
and other employee plans and benefits established by the Company (collectively
referred to herein as the "Company Benefit Plans") on the same terms as are
generally applicable to other senior executives of the Company, subject to
meeting applicable eligibility requirements.
2.6 Vacations and Holidays. During Executive's employment with the
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Company, Executive shall be entitled to an annual vacation leave at full pay,
such vacation to be 3 weeks in each year of the term hereof or such greater
vacation benefits as may be provided for by the Company's vacation policies
applicable to senior executives. Executive shall be entitled to such holidays
as are established by the Company for all employees.
ARTICLE III
NON-COMPETITION, CONFIDENTIALITY AND NONDISCLOSURE
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3.1 Proprietary Information. Concurrently with the execution and delivery
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of this Agreement, Executive shall execute and deliver the Confidentiality
Agreement attached as Exhibit B hereto.
3.2 Confidentiality. Executive agrees to keep the terms of this Agreement
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and the other terms of Executive's employment strictly confidential.
ARTICLE IV
TERMINATION
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4.1 Definitions. For purposes of this Article IV, the following
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definitions shall apply to the terms set forth below:
(a) Cause. "Cause" shall be defined as follows:
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(i) Executive's conviction of, or guilty plea relating to, any
felony (whether or not involving the Company) which
constitutes a crime of moral turpitude or which is
punishable by imprisonment in a state or federal
correction facility;
(ii) Failure by Executive to achieve the performance standards
or objectives agreed to in writing by the Board of
Directors and Executive;
(iii) Actions by Executive involving willful malfeasance or
gross negligence in the performance of Executive's duties;
(iv) Executive's commission of an act of fraud or dishonesty,
whether prior or subsequent to the date hereof, upon the
Company;
(v) Executive's failure or refusal to perform his duties as
required by this Agreement on an exclusive and full-time
basis;
(vi) Executive's insubordination or failure to follow the Board
of Directors' instructions; and
(vii) Executive's violation of any reasonable rule or regulation
of the Board of Directors applicable to all senior
executives if such violation is not cured to the
satisfaction of the Board of Directors promptly following
notice to Executive.
(b) Disability. "Disability" shall mean a physical or mental
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incapacity as a result of which the Executive becomes unable to continue the
proper performance of his duties hereunder in substantially a full time capacity
(reasonable absences because of sickness for up to three (3) consecutive months
excepted, provided, however, that any new period of incapacity or absences shall
be deemed to be part of a prior period of incapacity or absences if the prior
period terminated within ninety (90) days of the beginning of the new period of
incapacity or absence and the new capacity or absence is determined by the
Company's Board of Directors, in good faith, to be related to the prior
incapacity or absence.) A determination of Disability shall be subject to the
certification of a qualified medical doctor agreed to by the Company and the
Executive or, in the event of the Executive's incapacity to designate a doctor,
the Executive's legal representative. In the absence of agreement between the
Company and the Executive, each party shall nominate a qualified medical doctor
and the two doctors so nominated shall select a third doctor, who shall make the
determination as to Disability.
4.2 Termination by Company. The Company may terminate the Executive's
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employment hereunder immediately for Cause. Any termination for Cause hereunder
will only be effective if approved by at least a majority vote of the entire
Board of Directors. Subject to the other provisions contained in this
Agreement, the President or Chief Executive Officer of the
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Company may terminate this Agreement on behalf of the Company for any reason
other than Cause upon 30 days' written notice to Executive.
4.3 Termination by Executive. The Executive may terminate this Agreement
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upon 30 days' written notice to the Company.
4.4 Benefits Received Upon Termination.
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(a) If the Executive's employment is terminated by the Company for
Cause, or if this Agreement is terminated by Executive, then the Company shall
pay the Executive his Base Salary through the effective date of such termination
plus credit for any vacation earned but not taken and the Company shall
thereafter have no further obligations to Executive under this Agreement.
(b) If the Executive's employment is terminated by the Company
without Cause, then the Company shall:
(i) pay to the Executive within two business days following
the date of termination his Base Salary through the end of the
month during which such termination occurs plus credit for any
vacation earned but not taken;
(ii) pay to the Executive as severance pay (a) the Executive's
Base Salary in effect as of the date of termination, such
payments to be made in accordance with the Company's usual
payroll periods for a minimum of six (6) months or, if longer,
through the expiration of the term of employment then in effect
under this Agreement, without additional renewals as otherwise
provided hereunder, plus (b) within two business days after
termination a lump sum amount equal to any incentive bonus earned
by Executive as of the termination date but not yet paid by the
Company, plus (c) within two business days after termination an
amount equal to any incentive bonus to which Executive would be
entitled for his performance during the calendar quarter in which
the termination occurs, prorated according to the portion of the
quarter elapsed at the time of termination;
(iii) maintain, at the Company's expense, in full force and
effect, for the Executive's continued benefit during period of
salary continuation under the preceding subsection, all Company
medical insurance and reimbursement plans and other programs or
arrangements in which the Executive was entitled to participate
immediately prior to the date of termination, provided that the
Executive's continued participation is possible under the general
terms and provisions of such plans and programs; and
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(iv) pay the reasonable costs, consistent with what the Company
pays for its other executives, related to Executive's
participation in a senior executive outplacement program.
Notwithstanding the foregoing, if prior to expiration of the
period of salary continuation referred to in subsections (ii) and
(iii) above Executive commences employment that the Board of Directors
deems to be in competition with the Company's business, the payments
and benefits described in subsections (ii) and (iii) shall cease
immediately upon Executive's commencement of such competing
employment.
(c) Termination Because of Employee Disability. Should Executive
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become disabled from performing his duties hereunder as defined above, Executive
acknowledges that his employment may be terminated anytime thereafter if such
disability continues; provided that, during the period of the disability prior
to such termination of employment, Executive shall continue to receive all
compensation and benefits as if he were actively employed less any sums received
directly by the Executive, if any, under any policy or policies of disability
income insurance purchased by the Company. In the event of such termination,
Executive's rights to receive any salary or payments under this Agreement shall
terminate but Executive shall have the right to continue to receive any and all
payments made by an insurance company under any and all policies of disability
insurance purchased by the Company. Executive's rights under any Company
Benefit Plans will be those rights accorded to any terminated employee under the
plan provisions and applicable law. Executive will remain entitled to receive
any benefits under state disability or worker's compensation laws.
4.5 Effect of Termination. Upon any termination of this Agreement, for
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any reason, Executive shall be deemed to have immediately resigned as a director
of New Century Mortgage Corporation and all subsidiaries, if applicable, without
the giving of any notice or the taking of any other action.
ARTICLE V
ASSUMPTION OF OBLIGATIONS BY SUCCESSOR TO COMPANY
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5.1 Assumption of Obligations. The Company will require any successor or
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assign (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company, by agreement in form and substance satisfactory to the Executive,
expressly, absolutely and unconditionally to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession or assignment had taken place. Any
failure of the Company to obtain such agreement prior to the effectiveness of
any such succession or assignment shall be a material breach of this Agreement.
As used in this Agreement, "Company" shall mean the Company as herein before
defined and any successor or assign to its business and/or assets as aforesaid
which executes and delivers the agreement provided for in this Article V or
which otherwise becomes bound by all the terms and provisions of this Agreement
by
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operation of law. If at any time during the term of this Agreement the Executive
is employed by any corporation a majority of the voting securities of which is
then owned by the Company, "Company" as used in this Agreement shall in addition
include such employer.
5.2 Beneficial Interests. This Agreement shall inure to the benefit of
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and be enforceable by the Executive's personal and legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If the Executive should die while any amounts are still payable to
him or her hereunder, all such amounts, unless otherwise provided herein, shall
be paid in accordance with the terms of this Agreement to the Executive's
devisee, legatee, or other designee or, if there be no such designee, to the
Executive's estate.
ARTICLE VI
GENERAL PROVISIONS
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6.1 Notice. For purposes of this Agreement, notices and all other
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communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, as follows:
If to the Company: New Century Mortgage Corporation
00000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
If to the Executive: Xxxxxxx Xxxxxxxx
33 Cala de'Or
Xxxxxx Xxxxxx, Xxxxxxxxxx 00000
or such other address as either party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
6.2 No Waivers. No provision of this Agreement may be modified, waived or
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discharged unless such waiver, modification or discharge is agreed to in writing
signed by the Executive and the Company. No waiver by either party hereto at
any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.
6.3 Governing Law. This agreement shall be governed by and construed in
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accordance with the laws of the State of California.
6.4 Severability or Partial Invalidity. The invalidity or
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unenforceability of any provisions of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, which shall
remain in full force and effect.
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6.5 Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
6.6 Legal Fees and Expenses. Should any party institute any action or
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proceeding to enforce this Agreement or any provision hereof, or for damages by
reason of any alleged breach of this Agreement or of any provision hereof, or
for a declaration of rights hereunder, the prevailing party in any such action
or proceeding shall be entitled to receive from the other party all costs and
expenses, including reasonable attorneys' fees, incurred by the prevailing party
in connection with such action or proceeding.
6.7 Entire Agreement. This Agreement constitutes the entire agreement of
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the parties and supersedes all prior written or oral and all contemporaneous
oral agreements, understandings, and negotiations between the parties with
respect to the subject matter hereof. This Agreement is intended by the parties
as the final expression of their agreement with respect to such terms as are
included in this Agreement and may not be contradicted by evidence of any prior
or contemporaneous agreement. The parties further intend that this Agreement
constitutes the complete and exclusive statement of its terms and that no
extrinsic evidence may be introduced in any judicial proceeding involving this
Agreement.
6.8 Assignment. This Agreement and the rights, duties, and obligations
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hereunder may not be assigned or delegated by any party without the prior
written consent of the other party and any such attempted assignment and
delegation shall be void and be of no effect. Notwithstanding the foregoing
provisions of this Section 6.8, the Company may assign or delegate its rights,
duties, and obligations hereunder (i) to any affiliate, or (ii) to any person or
entity which succeeds to all or substantially all of the business of the Company
through merger, consolidation, reorganization, or other business combination or
by acquisition of all or substantially all of the assets of the Company;
provided that such person assumes the Company's obligations under this Agreement
in accordance with Section 5.1.
6.9 Arbitration. Any controversy, dispute, claim or other matter in
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question arising out of or relating to this Agreement shall be settled, at the
request of either party, by binding arbitration in accordance with the National
Rules for the Resolution of Employment Disputes of the American Arbitration
Association ("AAA"), and judgment upon the award rendered by the arbitrators may
be entered in any court having jurisdiction thereof, subject to the following
terms, conditions and exceptions:
(a) Notice of the demand for arbitration shall be filed in writing
with the other party and with the AAA. There shall be one arbitrator selected
in accordance with the procedures then existing for the selection of arbitrators
by the AAA.
(b) Reasonable discovery shall be allowed in arbitration.
(c) The costs and fees of the arbitration shall be allocated by the
arbitrator.
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6.10 Indemnification. To the extent permitted by law, applicable
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statutes and the Articles of Incorporation, Bylaws or resolutions of the Company
in effect from time to time, the Company shall indemnify Executive against
liability or loss arising out of Executive's actual or asserted misfeasance or
nonfeasance in the performance of Executive's duties or out of any actual or
asserted wrongful act against, or by, the Company including but not limited to
judgments, fines, settlements and expenses incurred in the defense of actions,
proceedings and appeals therefrom. The Company shall endeavor to obtain
Directors and Officers Liability Insurance to indemnify and insure the Company
and Executive from and against the aforesaid liabilities. The provisions of
this paragraph shall apply to the estate, executor, administrator, heirs,
legatees or devisees of Executive.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
NEW CENTURY MORTGAGE CORPORATION EXECUTIVE
By: /s/ Xxxxxxx Xxxxxxxx
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Xxxxxxx Xxxxxxxx
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EXHIBIT A
BONUS PLAN
Intentionally Omitted
EXHIBIT B
CONFIDENTIALITY AGREEMENT
NEW CENTURY MORTGAGE CORPORATION
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CONFIDENTIALITY AGREEMENT
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1. Introduction.
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I recognize that New Century Mortgage Corporation and its affiliated
companies (collectively, "New Century") is a consumer finance company
engaged in a continuous program of product and customer development
regarding its business, present and future, as a mortgage lending and
consumer finance company.
I understand that, during the course of my employment with New
Century, I may acquire and have access to confidential information and trade
secrets of New Century (collectively, "Confidential Information").
Specifically, I will have access to Confidential Information about New Century's
products, techniques, processes, services, clients, employee relationships,
marketing strategy and/or business plans, including, without limitation,
information relative to client lists, business development plans, business
studies, projections, business practices and finances. Additionally, I may have
access to highly confidential personal and financial information of New
Century's customers.
This Confidential Information is disclosed to me on a business need-
to-know basis only, and is considered confidential and secret by New Century.
Furthermore, this information is made known to me in confidence solely by virtue
of my employment, and is not generally known in the industry. My employment
with New Century creates a duty of trust and confidentiality to New Century with
respect to such Confidential Information.
2. Agreement to Maintain Confidentiality.
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At all times, both during my employment and after the cessation of my
employment, whether the cessation is voluntary or involuntary, for any reason or
no reason, or by disability, I will keep in strictest confidence and trust all
Confidential Information, and I will not disclose, use, or induce or assist in
the use or disclosure of any Confidential Information, or anything related
thereto, without the prior express written consent of New Century, except as may
be necessary in the ordinary course of performing my duties as an employee of
New Century.
I recognize that New Century has received and in the future will
receive from third parties their Confidential Information subject to a duty on
New Century's part to maintain the confidentiality of such information and to
use it only for certain limited purposes. I agree that I owe New Century and
such third parties, during my employment and thereafter, a duty to hold all such
Confidential Information in the strictest confidence, and I will not disclose,
use, or induce or assist in the use or disclosure of any such Confidential
Information without the prior express written consent of New Century, except as
may be necessary in the ordinary course of performing my duties as an employee
of New Century consistent with New Century's agreement with such third party.
I understand that the unauthorized use or dissemination of any
Confidential Information is considered a serious breach of confidence, and any
employee engaging in such activity is in violation of a number of laws,
including the California Uniform Trade Secrets Act. Such employee will be
subject to termination and/or legal action.
3. Agreement to Return Confidential Material.
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I agree that, upon termination of my employment, all documents,
records, notebooks, computer programs and records and similar repositories of or
containing Confidential Information, including all copies thereof, as well as
all other New Century property then in my possession or control, must be left
with or returned to New Century.
4. Agreement Regarding Inventions.
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I agree to disclose in writing and to assign on behalf of me or my
heirs, executors, or administrators, to New Century or its successors, any
inventions, processes, diagrams, methods, computer software, or any improvements
whatsoever that I may discover, conceive, or develop, either individually or in
collaboration with others, during the course of my employment with New Century,
or with the use of New Century's time, data, equipment, facilities, or
materials. I agree to execute all documents necessary or appropriate for use by
New Century in applying for, obtaining and enforcing any rights regarding
Confidential Information or inventions as New Century may desire, together with
any assignments thereof to New Century. This paragraph does not apply to any
invention which qualifies under the provisions of California Labor Code Section
2870 regarding inventions developed solely by an employee on his/her own time.
5. Use of Confidential Information to Compete with New Century.
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I agree that during my employment with New Century I will not, without
New Century's express written consent, engage in any employment or business
which is competitive with New Century, or any employment or business which is
otherwise in conflict with my employment relationship with New Century.
I further agree that during the term of my employment with New Century
and thereafter, I will not, either directly or indirectly, for me or for any
other person or entity, utilize or rely upon any Confidential Information to
call on, solicit, or take away, or attempt to call on, solicit, or take away any
past or present customers of New Century with respect to the same or similar
business services now or in the future provided by New Century.
I further agree that during my employment and for a period of the
longer of (i) six (6) months after cessation of my employment, or (ii) the
expiration of any post-cessation severance payments pursuant to any employment
agreement in effect between me and New Century at the time of cessation of my
employment, I will not, either directly or indirectly, either alone or in
concert with others, solicit or entice any employee of or consultant to New
Century to leave New Century to work for anyone in competition with New Century.
6. Representations Regarding Former Employment.
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I represent that my performance of all the terms of this Agreement and
as an employee of New Century does not and will not breach any agreement to keep
in confidence Confidential Information acquired by me in confidence or in trust
prior to my employment with New Century. I have not entered into, and I agree
that I will not enter into, any agreement, either written or oral, in conflict
herewith. I promise that I have not and will not bring to New Century any
materials or documents of a former employer that are not generally available to
the public, unless I have obtained express written authorization from any such
former employer for their possession and use. I also understand that, in my
service to New Century, I am not to breach any obligation of confidentiality
that I have to former employers, and I have fulfilled all such obligations
during my employment.
7. Injunctive Relief.
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I recognize that New Century is relying upon the existence and
validity of these provisions and that monetary damages would not be an adequate
remedy if I violated any of these provisions. Therefore, I expressly agree that
in addition to any rights or remedies New Century may have, New Century may
apply to any court of law or equity having jurisdiction for injunctive relief
(without posting a bond or other security) against any act which would violate
this Agreement.
8. General Provisions.
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The terms of this Confidentiality Agreement shall apply during and
after any period during which I perform any services for New Century. Nothing
in this Confidentiality Agreement shall obligate New Century to continue to
retain me as an employee. Upon cessation of my relationship with New Century, I
agree to execute an Affirmation of Confidentiality Agreement.
This Confidentiality Agreement shall be governed by and construed
under and according to the internal substantive laws, and not the laws of
conflicts, of the State of California. If any provision of this Confidentiality
Agreement shall be determined by any court of competent jurisdiction to be
unenforceable or otherwise invalid as written, the same shall be enforced and
validated to the extent permitted by law. In any litigation, arbitration, or
other proceeding by which one party either seeks to enforce its rights under
this Confidentiality Agreement or seeks a declaration of any rights or
obligations hereunder, the prevailing party shall be awarded reasonable attorney
fees, together with costs and expenses, to resolve the dispute and enforce the
final judgment.
This Confidentiality Agreement contains the sole and entire agreement
between New Century and myself with respect to the subject matter hereof, and
supersedes and replaces any prior agreements to the extent they are inconsistent
herewith. This Confidentiality Agreement can be amended or modified only by a
written agreement between New Century and myself.
My signature below confirms that I have read, understand and agree to
comply with the terms of this Confidentiality Agreement.
NEW CENTURY MORTGAGE EMPLOYEE
CORPORATION
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Signature of Employee
By:
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Its: Print Name
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Date Date
