DEFERRED COMPENSATION AGREEMENT
THIS AGREEMENT, made as of the 7th day of March, 2000, by and between
Financial Federal Corporation (the "Company") and Xxxxxxxx X. Xxxxxx, Xx. (the
"Employee");
W I T N E S S E T H :
WHEREAS, Employee is an employee of the Company; and
WHEREAS, the Employee and the Company desire to set forth in writing
herein the terms and conditions of their agreement with respect to the payment
to Employee, on a deferred basis, of the deferred compensation held by the
Company for the Employee's past service to the Company through and including
March 7, 2000.
NOW, THEREFORE, the parties hereto agree as follows:
1. The Company acknowledges that the Employee has deferred salary
with the Company as of March 7, 2000 in the amount of $2,266,722.77 ("deferred
compensation"). That deferred compensation earned by the Employee for his past
service to the Company through March 7, 2000, shall be deferred and, in lieu of
current payment thereof, the Company shall pay to the Employee the amounts
listed below on the respective dates listed below unless paid sooner pursuant
to this Agreement;
(i) $300,000.00 on April 1, 2001
(ii) $325,000.00 on April 1, 2002
(iii) $350,000.00 on April 1, 2003
(iv) $375,000.00 on April 1, 2004
(v) $400,000.00 on April 1, 2005
(vi) $450,000.00 on April 1, 2006
(vii) $500,000.00 on April 1, 2007
(viii) $408,950.71 on April 1, 2008
2. In the event of Employee's death, then payments of amounts due
hereunder shall be made first to the Employee's Beneficiary, Xxxx X. Xxxxxx,
the Employee's Wife, or if she is not then alive, to the Employee's Estate.
3. If, pursuant to paragraphs "2", "4" or "6" of this Agreement,
payment of any amount provided for in paragraph "1" of this Agreement is to be
made earlier than the due date set forth in such paragraph "1", the amount to
be paid is the amount as provided in paragraph "1" of this Agreement,
discounted at the rate of 6.60% per annum, compounded monthly, from the date
any such payments would have been due (as set forth in paragraph "1" of the
Agreement) to the actual date of payment. For purposes of illustration, a
payment of $500.00 would be due with respect to a $653.09 payment which would
have been due and payable forty-eight (48) months later.
4. If any federal, state or other tax law or regulation or any
determination by any taxing authority with respect to the Employee would cause
any amounts due pursuant to this Agreement to become taxable to the Employee
before payment thereof, except for taxes owing due to FICA, FUTA, or other
employment taxes, then the Employee, irrespective and notwithstanding any other
provisions of this Agreement, shall have the right, upon written notice to the
Company, to require payment of any of the installments or portions thereof
specified in paragraph "1" of this Agreement. The notice shall specify a date
within ninety (90) days of such notice when payment is to be made. The payment
shall be made in an amount calculated as set forth in paragraph "3" of this
Agreement.
5. Employee shall have no right to pledge, hypothecate, assign or
otherwise dispose of any amounts due or to become due hereunder. Employee's
right to receive payments under this Agreement shall be no greater than those
of any other unsecured creditor of the Company.
6. Should, at any time, more than 50 percent of the combined
voting power of the Company's then outstanding voting securities be held by any
person, entity or group of persons, directly or indirectly, within the meaning
of section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended
("Act"), other than those persons, entities or groups of persons owning over 14
percent of the combined voting power as of the date hereof, or a liquidation or
dissolution of the Company or of the sale of all or substantially all of the
Company's assets, then Employee may, upon 30 days notice, require that the
Company pay to Employee the amount payable pursuant to paragraph "1" of this
Agreement on the first day of the first month following such notice in an
amount calculated as set forth in paragraph "3" of this Agreement unless the
new person, entity or group of persons guarantee the obligations due hereunder.
7. During the term of this Agreement, the Company shall furnish to
Employee, no later than the 30th day of each fiscal year, a schedule setting
forth in reasonable detail the changes occurring during the preceding year and
the balance as at the end of the preceding year with respect to the amount
accrued by the Company on account of all sums payable hereunder to Employee.
8. Employee shall have the right at any time, by written notice to
the Company, to change the Beneficiary named in paragraph "2" hereof, with such
notice acknowledged in writing by the Company.
9. This Agreement contains the entire understanding of the parties
hereto relating to the payments described herein; however, this Agreement shall
not affect any other salary nor any other benefit that Employee may be or may
become entitled to, except as required by law. This written agreement
represents the entire final agreement between the parties relating to the
payments described herein and may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements of the parties. There are no
unwritten oral agreements between the parties. This agreement cannot be
amended, modified or changed except by a writing signed by both parties. Only
an officer of the Company with the title of Senior Vice President or a more
senior officer may accept this agreement or agree to any amendments,
modifications or changes.
10. This Agreement shall be governed and construed in accordance
with the laws of the State of New York. If any provision of this Agreement is
rendered or declared invalid, illegal or ineffective by any existing or
subsequently enacted legislation or decision of a court of competent
jurisdiction, such legislation or decision shall only invalidate such provision
to the extent so rendered or declared invalid, illegal or ineffective in such
jurisdiction only and shall not impair, invalidate or nullify the remainder of
this Agreement which shall remain in full force and effect.
11. Any controversy or claim arising out of or relating to this
Agreement or any alleged breach thereof shall be settled by arbitration in New
York City in accordance with the rules of the American Arbitration Association
governing contract disputes and judgment upon the award rendered by any
arbitrator(s) may be entered in any court of appropriate jurisdiction; the
Federal Arbitration Act and the applicable laws of the State of New York shall
govern.
IN WITNESS WHEREOF, Company has caused this Agreement to be executed by
its duly authorized officers and Employee has hereunto set his hand on the day
and year first above written.
FINANCIAL FEDERAL CORPORATION
BY:
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(Title)
EMPLOYEE:
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