EXECUTIVE EMPLOYMENT AND SEVERANCE AGREEMENT
Exhibit 10.4
EXECUTION COPY
This Executive Employment and Severance Agreement (“Agreement”) is entered into as of
November 8, 2010 between Xxxxxxx Xxxxxx (the “Executive”) and Imperial Holdings, LLC (the
“Company”).
WHEREAS, the Executive is employed by the Company in a key employee capacity and the
Executive’s services are valuable and integral to the conduct of the business of the Company; and
WHEREAS, the Company intends to convert to a corporation (and following such conversion, the
term “Company” when used herein shall refer to such corporation), and thereafter intends to sell
its common stock to the public pursuant to an effective registration statement filed under the
Securities Act of 1933, as amended (the “IPO”);
WHEREAS, the Company and the Executive desire to specify the terms and conditions on which the
Executive will continue employment on and after the date of the IPO, and under which the Executive
will receive severance in the event that the Executive separates from service with the Company;
WHEREAS, the parties intend that this Agreement shall supersede any and all other agreements,
either oral or in writing, between the parties with respect to the employment of the Executive by
the Company, and all such agreements shall be void and of no effect as of the effective date of
this Agreement;
NOW, THEREFORE, for good and valuable consideration, the parties agree as follows:
1. Effective Date; Term. This Agreement shall become effective on the closing
date of the Company’s IPO. This Agreement shall remain in effect until terminated as provided in
Section 4. Termination of this Agreement will not affect the rights or obligations of the parties
hereunder arising out of, or relating to, circumstances occurring prior to the expiration of this
Agreement, which rights and obligations will survive the termination of this Agreement and the
termination of Executive’s employment with the Company.
2. Definitions. For purposes of this Agreement, the following terms shall have
the meanings ascribed to them. Additional defined terms are included throughout this Agreement.
(a) “409A Affiliate” shall mean each entity that is required to be included in the
Company’s controlled group of corporations within the meaning of Code Section 414(b), or
that is under common control with the Company within the meaning of Code Section 414(c);
provided, however, that the phrase “at least 50 percent” shall be used in place of the
phrase “at least 80 percent” each place it appears therein or in the regulations thereunder.
(b) “Accrued Benefits” shall mean the following amounts, payable as described
herein: (i) all base salary for the time period ending with the date of the
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Executive’s Termination of Employment; (ii) reimbursement for any and all monies
advanced in connection with the Executive’s employment for reasonable and necessary expenses
incurred by the Executive on behalf of the Company for the time period ending with the date
of the Executive’s Termination of Employment; (iii) except in the event of termination for
Cause, a pro rata portion (determined by dividing the number of days the Executive is
employed during the year through the date of termination by 365) of any annual performance
bonus payable with respect to the year in which the termination occurs, based on actual
performance results; (iv) any and all other cash earned and vested through the date of the
Executive’s Termination of Employment and deferred at the election of the Executive or
pursuant to any deferred compensation plan then in effect; and (v) all other payments and
benefits to which the Executive (or in the event of the Executive’s death, the Executive’s
surviving spouse or other beneficiary) is entitled on the date of the Executive’s
Termination of Employment under the terms of any benefit plan of the Company, excluding
severance payments under any Company severance policy, practice or agreement in effect on
such date. Payment of Accrued Benefits shall be made promptly in accordance with the
Company’s prevailing practice with respect to clauses (i) and (ii) or, with respect to
clauses (iii), (iv) and (v), pursuant to the terms of the benefit plan or practice
establishing such benefits.
(c) “Base Salary” shall mean the Executive’s annual base salary from the Company as
in effect from time to time.
(d) “Board” shall mean the board of directors of the Company or a committee of such
Board authorized to act on its behalf in certain circumstances, including the Compensation
Committee of the Board.
(e) “Cause” shall mean a good faith finding by the Chief Executive Officer or the
President of the Company that the Executive has done any of the following: (i) failed,
neglected, or refused to perform the lawful employment duties related to his or her position
or as from time to time assigned to him or her (other than due to Disability); (ii)
committed any willful, intentional, or negligent act having the effect of materially
injuring the interest, business, or reputation of the Company; (iii) violated or failed to
comply in any material respect with the Company’s published rules, regulations, or policies,
as in effect or amended from time to time; (iv) committed an act constituting a felony or
misdemeanor involving moral turpitude, fraud, theft, or dishonesty; (v) misappropriated or
embezzled any property of the Company (whether or not an act constituting a felony or
misdemeanor); or (vi) breached any material provision of this Agreement or any other
applicable confidentiality, non-compete, non-solicit, general release, covenant not-to-xxx,
or other agreement with the Company.
(f) “Code” shall mean the Internal Revenue Code of 1986, as interpreted by rules
and regulations issued pursuant thereto, all as amended and in effect from time to time.
Any reference to a specific provision of the Code shall be deemed to include reference to
any successor provision thereto.
(g) “Confidential Information” shall mean ideas, information, knowledge and
discoveries, whether or not patentable, that are not generally known in the trade or
industry and about which the Executive has knowledge as a result of his or her past, present
or future participation in the business of the Company and/or his or her past,
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present or future employment with or other relationship with the Company, including
without limitation: products engineering information; marketing, sales, distribution,
pricing and bid process information; product specifications; manufacturing procedures;
methods; business plans; strategic plans; marketing plans; internal memoranda; formulae;
trade secrets; know-how; research and development programs and data; inventions;
improvements; designs; sales methods; customer or prospective customer, supplier, sales
representative, distributor and licensee lists; mailing lists; customer usages and
requirements; computer programs; employee compensation information; employee performance
evaluations and employment-related personnel information; and other confidential technical
or business information and data.
(h) “Competing Organization” shall mean any person (including, without limitation,
the Executive as a sole proprietor) or entity engaged in or planning or attempting to become
engaged in any business that engages in premium finance of life insurance, life settlements
or structured settlements within the United States of America and/or within 100 miles of any
offices of the Company or client of the Company.
(i) “Disability” shall mean the inability of the Executive to engage in any
substantial gainful activity by reason of any medically determinable physical or mental
impairment, which can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months..
(j) “Company” shall mean the Imperial Holdings, LLC, its subsidiaries, its
affiliates, its successors, and its parents.
(k) “General Release” shall mean a release of all claims that the Executive, and
anyone who may succeed to any claims of the Executive, has or may have against the Company,
its board of directors, any of its subsidiaries or affiliates, or any of their employees,
directors, officers, employees, agents, plan sponsors, administrators, successors,
fiduciaries, or attorneys, including but not limited to claims arising out of the
Executive’s employment with, and termination of employment from, the Company, but excluding
claims for (i) severance payments and benefits due pursuant to Section 5 of this Agreement,
(ii) Accrued Benefits, and (iii) any and all rights the Executive has to be indemnified and
held harmless as an officer of the Company under law or the Company’s charter, bylaws, or
other governing instruments and related rights as an insured under any insurance policies
obtained by an Company in connection therewith. The General Release shall be in a form that
is reasonably acceptable to the Company.
(l) “Separation from Service” shall mean the Executive’s Termination of Employment,
or if the Executive continues to provide services to the Company or its 409A Affiliates
following his or her Termination of Employment, such later date as is considered a
separation from service from the Company and its 409A Affiliates within the meaning of Code
Section 409A. Specifically, if the Executive continues to provide services to the Company
or a 409A Affiliate in a capacity other than as an employee, such shift in status is not
automatically a Separation from Service.
(m) “Severance Period” shall mean a period equal to eighteen (18) weeks following
the Executive’s Separation from Service. No severance shall be available to the Executive
unless specifically provided for under this Agreement.
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(n) “Termination of Employment” shall be presumed to occur when the Company and the
Executive reasonably anticipate that no further services will be performed by the Executive
for the Company and its 409A Affiliates or that the level of bona fide services the
Executive will perform as an employee of the Company and its 409A Affiliates will
permanently decrease to no more than twenty percent (20%) of the average level of bona fide
services performed by the Executive (whether as an employee or independent contractor) for
the Company and its 409A Affiliates over the immediately preceding 36-month period (or such
lesser period of services). Whether the Executive has experienced a Termination of
Employment shall be determined by the Company in good faith and consistent with Code Section
409A. Notwithstanding the foregoing, if the Executive takes a leave of absence for purposes
of military leave, sick leave or other bona fide reason, the Executive will not be deemed to
have experienced a Termination of Employment for the first six (6) months of the leave of
absence, or if longer, for so long as the Executive’s right to reemployment is provided
either by statute or by contract, including this Agreement; provided that if the leave of
absence is due to a medically determinable physical or mental impairment that can be
expected to result in death or last for a continuous period of not less than six (6) months,
where such impairment causes the Executive to be unable to perform the duties of his or her
position of employment or any substantially similar position of employment, the leave may be
extended by the Company for up to twenty-nine (29) months without causing a Termination of
Employment.
3. Employment of the Executive
(a) Position.
(i) The Executive shall serve in the position of Senior Vice President of
the Company in a full-time capacity. In such position, the Executive shall have
such duties and authority as is customarily associated with such position and shall
have such other titles and duties, consistent with the Executive’s position, as may
be assigned from time to time by the Chief Executive Officer or the President of the
Company.
(ii) The Executive will devote the Executive’s full business time and best
efforts to the performance of the Executive’s duties hereunder and will not engage
in any other business, profession or occupation for compensation or otherwise which
would conflict or interfere with the rendition of such duties and/or services either
directly or indirectly, without the prior written consent of the Chief Executive
Officer or the President of the Company; provided that nothing herein shall preclude
the Executive, subject to the prior approval of the Chief Executive Officer or the
President of the Company, from accepting appointment to or continue to serve on any
board of directors or trustees of any business corporation or any charitable
organization; further provided in each case, and in the aggregate, that such
activities do not conflict or interfere with the performance of the Executive’s
duties and/or services, either directly or indirectly, or conflict with Section 7.
(iii) The Executive warrants and represents to the Company that the
Executive is not subject to any employment, consulting or services agreement, or any
restrictive covenants or agreements of any type, which would conflict or
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prohibit the Executive from fully carrying out the Executive’s duties as
described under the terms of this Agreement.
(b) Base Salary. The Company shall pay the Executive a Base Salary at the annual
rate of $325,000, payable in regular installments in accordance with the Company’s usual
payroll practices. The Executive shall be entitled to such increases in the base salary, if
any, as may be determined from time to time by the Chief Executive Officer or the President
of the Company. In addition, the Chief Executive Officer and/or the President of the
Company reserves the right to decrease the Executive’s Base Salary if such decrease applies
to all other executives on a uniform basis, or for performance issues, as determined in the
sole discretion of the Chief Executive Officer and/or President of the Company.
(c) Bonus Incentives. The Executive shall be entitled to participate in such
annual and/or long-term cash and equity incentive plans and programs of the Company as are
generally provided to the senior executives of the Company as determined by the Board from
time to time.
(d) Employee Benefits. The Executive shall be entitled to participate in the
Company’s employee benefit plans as in effect from time to time on the same basis as those
benefits are generally made available to other salaried employees of the Company.
(e) Business Expenses. The reasonable business expenses incurred by the Executive
in the performance of the Executive’s duties hereunder shall be reimbursed by the Company in
accordance with the Company policies.
4. Termination of Employment. The Executive’s employment with the Company will
terminate during the term of the Agreement, and this Agreement will terminate on the date of such
termination, as follows:
(a) Death. The Executive’s employment will terminate upon the Executive’s death.
(b) Disability. If the Executive is Disabled, and if within thirty (30) days after
the Company notifies the Executive in writing that it intends to terminate the Executive’s
employment, the Executive shall not have returned to the performance of the Executive’s
duties hereunder on a full-time basis, the Company may terminate the Executive’s employment,
effective immediately following the end of such thirty-day period.
(c) By Company. The Company may terminate the Executive’s employment with or
without Cause (other than as a result of Disability which is governed by subsection (b)) by
providing written notice to the Executive that indicates in reasonable detail the facts and
circumstances alleged to provide a basis for such termination. If the termination is
without Cause, the Executive’s employment will terminate on the date specified in the
written notice of termination. If the termination is for Cause, and if the conduct or act
alleged to provide grounds for the Executive’s termination for Cause is curable, then the
Executive shall have thirty (30) days from the date the written notice is provided, or such
longer period as the Company may determine to be appropriate, to cure
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any such conduct or
act. If the alleged conduct or act constituting Cause is not curable, the Executive’s employment will immediately terminate on the date specified in the
written notice of termination. If the alleged conduct or act constituting Cause is curable
but the Executive does not cure such conduct or act within the specified time period, the
Executive’s employment will terminate on the date immediately following the end of the cure
period. Unless otherwise directed by the Company, from and after the date of the written
notice of proposed termination, the Executive shall be immediately relieved of his or her
duties and responsibilities and shall be considered to be on a paid leave of absence pending
any final action by the Company confirming such proposed termination.
(d) By Executive. The Executive may terminate his or her employment with the
Company by providing written notice of termination to the Company at least thirty (30) days
prior to the effective date of such termination.
5. Payments upon Termination.
(a) Entitlement to Severance. Subject to the other terms and conditions of this
Agreement, upon the Executive’s Termination of Employment, the Executive shall be entitled
to the Accrued Benefits, and if the Executive’s employment is terminated by the Company
without Cause (other than as a result of death or Disability) to the severance payments
described in subsection 5 (c). If the Executive dies after receiving a notice by the
Company that the Executive is being terminated without Cause, then the Executive’s estate,
heirs and beneficiaries shall be entitled to the Accrued Benefits and the severance benefits
described in subsection (c) at the same time such amounts would have been paid or benefits
provided to the Executive had he or she lived.
(b) General Release and Covenant Not to Xxx Requirement. As an additional
prerequisite for receipt of the severance benefits described in subsection 5 (c), the
Executive must execute, deliver to the Company, and not revoke (to the extent the Executive
is allowed to do so) a General Release and Covenant Not to Xxx within forty-five (45) days
of the date of the Executive’s Termination of Employment.
(c) Severance Benefit; Timing and Form of Payment.
(i) Subject to the limitations imposed by paragraph (ii) hereof and Section
5, if the Executive is entitled to receive severance hereunder, then the Company
shall pay the Executive severance in the form of continued payment of the
Executive’s Base Salary for the Severance Period. The severance payment(s) shall be
paid in accordance with the Company’s usual payroll practices starting forty-six
(46) days following the Executive’s Separation from Service and ending at the end of
the Severance Period.
(ii) Notwithstanding the foregoing, if the amount of the severance payments
to be made to the Executive within the first six months following the Executive’s
Separation from Service will exceed two times the lesser of (A) the Executive’s
annualized compensation based upon the annual rate of pay from the Company for the
calendar year preceding the year of the Executive’s Separation from Service
(adjusted for any increase during that prior year that was expected to continue
indefinitely absent a termination of employment) and (B) the
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compensation limit in
effect under Code Section 401(a)(17) for the calendar year
in which the Executive’s Separation from Service occurs, then such excess
amount shall be delayed and paid on the first day of the seventh month following the
Executive’s Separation from Service (without interest thereon). This paragraph (ii)
shall not apply, however, if on the date of the Executive’s Separation from Service,
the Executive is not considered a “specified employee” within the meaning of Code
Section 409A or (ii) the Company is not a public company.
(d) Other Termination of Employment. If the Executive’s employment terminates for
any reason other than as described in subsection (a), then the Executive (or the Executive’s
estate in the event of his or her death), shall be entitled to receive only the Accrued
Benefits. Accordingly, and without limitation, Executive shall not be entitled to any
severance from the Company should Executive’s employment be terminated for Cause.
6. Limitations on Severance Payment and Other Payments or Benefits.
(a) Limitation on Payments. Notwithstanding any provision of this Agreement, if
any portion of the severance payments or any other payment under this Agreement, or under
any other agreement with the Executive or plan of the Company or its affiliates (in the
aggregate, “Total Payments”), would constitute an “excess parachute payment” and would, but
for this Section 6, result in the imposition on the Executive of an excise tax under Code
Section 4999, then the Total Payments to be made to the Executive shall be delivered in such
amount so that no portion of such Total Payment would be subject to the Excise Tax.
(b) Determination of Limit. Within forty (40) days following a termination of
employment or notice by one party to the other of its belief that there is a payment or
benefit due the Executive that will result in an excess parachute payment, the Executive and
the Company, at the Company’s expense, shall obtain the opinion (which need not be
unqualified) of a nationally recognized tax counsel (“National Tax Counsel”) selected by the
Company (which may be regular outside counsel to the Company), which opinion sets forth (i)
the amount of the Base Period Income (as defined below), (ii) the amount and present value
of the Total Payments, (iii) the amount and present value of any excess parachute payments
determined without regard to any reduction of Total Payments pursuant to subsection (a).
The opinion of National Tax Counsel shall be addressed to the Company and the Executive and
shall be binding upon the Company and the Executive. If such National Tax Counsel opinion
determines that the Total Payment should be reduced pursuant to subsection (a), then the
Termination Payment hereunder or any other payment or benefit determined by such counsel to
be includable in Total Payments shall be reduced or eliminated so that under the bases of
calculations set forth in such opinion there will be no excess parachute payment. In such
event, payments or benefits included in the Total Payments shall be reduced or eliminated by
applying the following principles, in order: (1) the payment or benefit with the higher
ratio of the parachute payment value to present economic value (determined using reasonable
actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a
lower ratio; (2) the payment or benefit with the later possible payment date shall be
reduced or eliminated before a payment or benefit with an earlier payment date; and (3)
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cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing
order of reduction or elimination would violate Code Section 409A, then the reduction
shall be made pro rata among the payments or benefits included in the Termination Payments
(on the basis of the relative present value of the parachute payments).
(c) Definitions and Assumptions. For purposes of this Agreement: (i) the terms
“excess parachute payment” and “parachute payments” shall have the meanings assigned to them
in Code Section 280G and such “parachute payments” shall be valued as provided therein; (ii)
present value shall be calculated in accordance with Code Section 280G(d)(4); (iii) the term
“Base Period Income” means an amount equal to the Executive’s “annualized includible
compensation for the base period” as defined in Code Section 280G(d)(1); and (iv) for
purposes of the opinion of National Tax Counsel, the value of any noncash benefits or any
deferred payment or benefit shall be determined by the Company’s independent auditors in
accordance with the principles of Code Sections 280G(d)(3) and (4), which determination
shall be evidenced in a certificate of such auditors addressed to the Company and the
Executive.
(d) Reasonableness of Compensation. If such National Tax Counsel so requests in
connection with the opinion required by this Section 6, the Executive and the Company shall
obtain, at the Company’s expense, and the National Tax Counsel may rely on, the advice of a
firm of recognized executive compensation consultants as to the reasonableness of any item
of compensation to be received by the Executive solely with respect to its status under Code
Section 280G.
(e) Indemnification. The Company agrees to bear all costs associated with, and to
indemnify and hold harmless, the National Tax Counsel of and from any and all claims,
damages, and expenses resulting from or relating to its determinations pursuant to this
Section 6, except for claims, damages or expenses resulting from the gross negligence or
willful misconduct of such firm.
(f) Changes to Code Section. This Section 6 shall be amended to comply with any
amendment or successor provision to Sections 280G or 4999 of the Code. If such provisions
are repealed without successor, then this Section 5 shall be cancelled without further
effect.
7. Covenants by the Executive.
(a) Confidential Information. All Confidential Information shall be deemed to have
been received by the Executive as an employee of the Company. During the term of
Executive’s employment, Executive will not directly or indirectly use or disclose any
Confidential Information or trade secret (as defined under applicable law) of the Company
except in the interest and for the benefit of the Company. After the end, for whatever
reason, of Executive’s employment with the Company, Executive will not directly or
indirectly use or disclose any Confidential Information or trade secret of the Company.
Specifically, during Executive’s employment with the Company, and subsequent to Executive’s
separation from the Company, for any reason, with or without Cause, the Executive will not
directly or indirectly (i) disclose any Confidential Information to any person or entity,
(ii) use any Confidential Information for any purpose, (iii) duplicate any Confidential
Information for any purpose or (iv) remove any
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Confidential Information from the facilities
or premises of the Company for any purpose,
except to the extent such action is for the exclusive benefit of the Company, as
applicable, and as it or they may direct or is necessary to fulfill the Executive’s
continuing duties as an employee of or consultant to the Company. Notwithstanding the
foregoing, the Executive may disclose Confidential Information at such times, in such manner
and to the extent such disclosure is required by court order or lawful non-collusive
subpoena, provided that the Executive (x) provides the Company with prior thirty (30) day
written notice of such disclosure so as to permit the affected Company to seek a protective
order or other appropriate remedy, (y) limits such disclosure to what is strictly required
and (z) attempts to preserve the confidentiality of any such Confidential Information so
disclosed.
(b) Return of Property. All memoranda, notes, records, papers, tapes, disks,
programs or other property of any nature whatsoever and all copies thereof relating to the
operations or business of the Company, some of which may be prepared by the Executive, and
all objects associated therewith in any way obtained by him or her shall be the sole
property of the Company. Upon his or her termination of employment, the Executive shall
deliver to the Company all of the aforementioned documents and objects, if any, that may be
in his or her possession, and cooperate with the Company to destroy and/or delete any
electronically stored copies of the aforementioned documents and objects, if any, at any
time at the request of the Company.
(c) Noncompetition. During the Executive’s employment with the Company and, for a
period of twenty-four (24) months after termination thereof, the Executive shall not
directly or indirectly, without the prior written consent of the Board:
(i) own or control, whether as a shareholder (other than a less than five
percent (5%) shareholder in a corporation or other entity whose securities are
traded on a recognized stock exchange or traded on the over the counter market),
member, partner, director or otherwise, or manage, operate, be employed or
compensated by, or consult with (whether or not compensated), whether as an officer,
executive, consultant or otherwise, any Competing Organization, in any capacity
where the Executive’s knowledge of Confidential Information or involvement with or
knowledge of relationships with customers of the Company would be useful or
beneficial, or where the goodwill of the Company would be considered useful or
beneficial to such Competing Organization or would be affected; or
(ii) undertake any action, on behalf of any Competing Organization relating
to the sale or marketing of products or services that compete with products or
services researched, developed, designed, manufactured, assembled, produced,
marketed, distributed, sold, repaired or provided by the Company, or, to the extent
the Executive has or receives notice or knowledge of such plans, within the active
research, development, expansion or business plans of the Company, to any customers
or prospective customers of the Company which the Executive had knowledge, or with
respect to which the Executive obtained Confidential Information, or with whom the
Executive had personal contact or communications in his capacity as an employee of
the Company, at any time during his period of employment with the Company.
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(d) Nonsolicitation of Employees. During the Executive’s employment with the
Company and, then for a period of twenty-four (24) months after termination thereof, the
Executive shall not directly or indirectly, without the prior written consent of the
Company, solicit, induce or otherwise offer employment or engagement as an independent
contractor to, or engage in discussions regarding employment or engagement as an independent
contractor with, any person who served as an employee, commissioned salesperson or
consultant of, or who performed similar services for, the Company during the Executive’s
employment with the Company prior to or during the Executive’s period of employment.
(e) Nonsolicitation of Clients and Vendors. During the Executive’s employment with
the Company and, then for a period of twenty-four (24) months after termination thereof, the
Executive shall not directly or indirectly, without the prior written consent of the
Company, solicit, sell to, or provide products or services to any client or prospective
client of the Company. Further, during the Executive’s employment with the Company and, then
for a period of twenty-four (24) months after termination thereof, the Executive shall not
directly or indirectly, without the prior written consent of the Company, solicit, purchase
from, or obtain products or services from any vendor of the Company.
(f) Remedies Not Exclusive. In the event that the Executive breaches any terms of
this Section 7, the Executive acknowledges and agrees that said breach may result in the
immediate and irreparable harm to the business and goodwill of the Company and that damages,
if any, and remedies of law for such breach may be inadequate and indeterminable. The
Company, upon the Executive’s breach of this Section 7, shall therefore be entitled (in
addition to and without limiting any other remedies that the Company may seek under this
Agreement or otherwise at law or in equity) to (i) seek from any court of competent
jurisdiction equitable relief by way of temporary and/or permanent injunction and without
being required to post a bond, to restrain any violation of this Section 7, and for such
further relief as the court may deem just or proper in law or equity, and (ii) in the event
that the Company shall prevail, its reasonable attorney’s fees and costs and other expenses
in enforcing its rights under this Section 7 and/or Florida law, including Fla. Stat.
542.335.
(g) Severability of Provisions. If any restriction, limitation, or provision of
this Section 7 is deemed to be unreasonable, onerous, or unduly restrictive by a court of
competent jurisdiction, it shall not be stricken in its entirety and held totally void and
unenforceable, but shall remain effective to the maximum extent possible within the bounds
of the law. If any phrase, clause or provision of this Section 7 is declared invalid or
unenforceable by a court of competent jurisdiction, such phrase, clause, or provision shall
be deemed severed from this Section 7, but will not affect any other provision of this
Section 7, which shall otherwise remain in full force and effect. The provisions of this
Section 7 are each declared to be separate and distinct covenants by the Executive.
8. Compliance with Code Section 409A.
(a) The Company and the Executive intend the terms of this Agreement to be in
compliance with Code Section 409A. The Company does not guarantee the tax treatment or tax
consequences associated with any payment or benefit, including but not
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limited to consequences related to Code Section 409A. To the maximum extent permissible, any
ambiguous terms of this Agreement shall be interpreted in a manner that avoids a violation
of Code Section 409A.
(b) If the Executive believes he or she is entitled to a payment or benefit
pursuant to the terms of this Agreement that was not timely paid or provided, and such
payment or benefit is considered deferred compensation subject to the requirements of Code
Section 409A, the Executive acknowledges that to avoid an additional tax on such payment or
benefit pursuant to the provisions of Code Section 409A, the Executive must make a
reasonable, good faith effort to collect such payment or benefit no later than ninety (90)
days after the latest date upon which the payment could have been timely made or benefit
timely provided without violating Code Section 409A, and if not paid or provided, must take
further enforcement measures within one hundred eighty (180) days after such latest date.
(c) Neither the Company nor the Executive, individually or in combination, may
accelerate any payment or benefit that is subject to Code Section 409A, except in compliance
with Code Section 409A and the provisions of this Agreement, and no amount that is subject
to Code Section 409A shall be paid prior to the earliest date on which it may be paid
without violating Code Section 409A.
(d) For purposes of applying the provisions of Section Code 409A to this Agreement,
each separately identified amount to which the Executive is entitled under this Agreement
shall be treated as a separate payment. In addition, to the extent permissible under Code
Section 409A, any series of installment payments under this Agreement shall be treated as a
right to a series of separate payments. Whenever a payment under this Agreement specifies a
payment period with reference to a number of days, the actual date of payment within the
specified period shall be within the sole discretion of the Company.
9. Withholding. The Company shall be entitled to withhold from amounts to be paid
to the Executive hereunder any federal, state or local withholding or other taxes or charges which
it is from time to time required to withhold; provided that the amount so withheld shall not exceed
the minimum amount required to be withheld by law unless otherwise elected by the Executive in
writing. In addition, if prior to the date of payment of the Severance Payment, if any, the
Federal Insurance Contributions Act (FICA) tax imposed under Sections 3101, 3121(a) and 3121(v)(2)
of the Code, where applicable, becomes due with respect to such payment, the Company may provide
for an immediate payment of the amount needed to pay the Executive’s portion of such tax (plus an
amount equal to the taxes that will be due on such amount) and the Executive’s Severance Payment
shall be reduced accordingly. The Company shall be entitled to rely on an opinion of the National
Tax Counsel if any question as to the amount or requirement of any such withholding shall arise.
10. Notice. Any notice, request, demand or other communication required or
permitted herein will be deemed to be properly given when personally served in writing or when
deposited in the United States mail, postage prepaid, addressed to the Executive at his or her
latest home address on file with the Company and to the Company addressed to its headquarters with
attention to the Chief Executive Officer of the Company and the General Counsel of the Company.
Either party may change its address by written notice in accordance with this section.
| Page 11 of 13 | Company Initials Executive Initials |
11. Set Off; Mitigation. The Company’s obligation to pay the Executive the
amounts and to provide the benefits hereunder shall be subject to set-off, counterclaim or
recoupment of amounts owed by the Executive to the Company. Further, the Executive shall be
required to mitigate the amount of any payment provided for pursuant to this Agreement by promptly
seeking other employment or otherwise.
12. Benefit of Agreement. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective executors, administrators, successors and
assigns. If Company sells, assigns or transfers all or substantially all of its business and
assets to any person or if the Company merges into or consolidates or otherwise combines (where the
Company does not survive such combination) with any person (any such event, a “Sale of Business”),
then the Company shall assign all of its right, title and interest in this Agreement as of the date
of such event to such person, and the Company shall cause such person, by written agreement in form
and substance reasonably satisfactory to the Executive, to expressly assume and agree to perform
from and after the date of such assignment all of the terms, conditions and provisions imposed by
this Agreement upon the Company. The assignment of this Agreement to, and the Executive’s
employment by, such person shall not constitute a termination of employment hereunder. In case of
such assignment by the Company and of assumption and agreement by such person, as used in this
Agreement, the “Company” shall thereafter mean the person which executes and delivers the agreement
provided for in this Section 12 or which otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law, and this Agreement shall inure to the benefit of, and be
enforceable by, such person. The Executive shall, in his or her discretion, be entitled to proceed
against any or all of such persons, any person which theretofore was such a successor to the
Company, and the Company (as originally defined herein) in any action to enforce any rights of the
Executive hereunder. Except as provided in this Section 12, this Agreement shall not be assignable
by the Company. This Agreement shall not be terminated by the voluntary or involuntary dissolution
of the Company.
13. Survival. The provisions of Sections 5 through 19 shall survive the
termination of this Agreement to the extent necessary to enforce the rights and obligations
described therein.
14. Applicable Law, Exclusive Venue and Jurisdiction. This Agreement is to be
governed by and construed under the laws of the State of Florida without resort to Florida’s choice
of law rules. Each party hereby agrees that the forum and exclusive venue for any legal or
equitable action or proceeding arising out of, or in connection with, this Agreement will lie in
the appropriate federal or state courts in Palm Beach County, Florida and specifically waives any
and all objections to personal jurisdiction and venue.
15. Captions and Section Headings. Captions and section headings used herein are
for convenience only and are not a part of this Agreement and will not be used in construing it.
16. Invalid Provisions. Should any provision of this Agreement for any reason be
declared invalid, void, or unenforceable by a court of competent jurisdiction, the validity and
binding effect of any remaining portion will not be affected, and the remaining portions of this
Agreement will remain in full force and effect as if this Agreement had been executed with said
provision eliminated.
| Page 12 of 13 | Company Initials Executive Initials |
17. No Waiver. The failure or delay of the Company to insist upon strict
adherence to any term of this Agreement on any occasion shall not be considered a waiver of the
Company’s rights to insist upon strict adherence to that term or any other term of this Agreement.
18. Application of Company’s Recoupment Policy. Notwithstanding anything herein
to the contrary, all performance-based compensation payments made to Executive hereunder are
subject to recoupment by the Company pursuant to the recoupment policy approved by the Board, as it
may be amended from time to time.
19. Entire Agreement. This Agreement contains the entire agreement of the parties
with respect to the subject matter of this Agreement except where other agreements are specifically
noted, adopted, or incorporated by reference. This Agreement otherwise supersedes any and all
other agreements, either oral or in writing, between the parties hereto with respect to the
employment of the Executive by the Company, and all such agreements shall be void and of no effect.
Each party to this Agreement acknowledges that no representations, inducements, promises, or
agreements, oral or otherwise, have been made by any party, or anyone acting on behalf of any
party, which are not embodied herein, and that no other agreement, statement, or promise not
contained in this Agreement will be valid or binding.
20. Modification. This Agreement may not be modified or amended by oral
agreement, but only by an agreement in writing signed by both the Company and the Executive.
21. Counterparts. This Agreement may be signed in counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and hereto were upon the
same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
written above.
EXECUTIVE
|
IMPERIAL HOLDINGS, LLC | |||
/s/
Xxxxxxx Xxxxxx |
/s/ Xxxxxx Xxxxxxxx | |||
Signature
|
By | |||
Xxxxxxx Xxxxxx
|
Xxxxxx Xxxxxxxx | |||
Xxxxxxx Xxxxxx
|
Name | |||
11/8/2010
|
CEO | |||
Date
|
Title |
| Page 13 of 13 |
