April 24, 2000
Xxxxxxxx X. Xxxxx
Via Hand Delivery
RE: Retention Bonus and Sales Commission
Dear Xxxxx:
In recognition of your past and ongoing contributions to
AMRESCO, INC. ("AMRESCO"), we are pleased to offer to you a
Retention Bonus, based upon the terms and conditions
contained in this letter agreement. XXXXXXX, like any
publicly traded company, cannot guarantee continued
employment through December 31, 2000.
We believe that there is an ongoing position for you with
AMRESCO, and this letter in no way implies that we intend to
terminate your employment with AMRESCO at some future date.
Rather, it is to acknowledge your special value to our
organization.
If either (a) your termination of employment (as hereinafter
defined) or (b) a Change of Control (as hereinafter defined)
occurs prior to December 31, 2000, you will be paid a one
time bonus of $1,500,000. This amount will be paid within
fifteen (15) days of the date of the earlier to occur of (i)
such termination of employment or (ii) Change of Control in
a lump sum, and will be subject to applicable withholding.
This bonus is in lieu of any other form of severance
compensation for which you are or may become eligible.
If you are a full-time employee of AMRESCO or one of its
affiliates on (a) December 31, 2000 or (b) thirty (30) days
after the closing of the sale of all of the three (3)
business units within AMRESCO's Commercial Finance division
(Builders Group, ACLC and AMRESCO Independence Funding,
Inc.), you will be paid a one time bonus of $1,500,000.
This amount will be paid in a lump sum within fifteen (15)
days of the appropriate date, and will be subject to
applicable withholding. This bonus is in lieu of any other
form of severance compensation for which you are or may
become eligible.
For purposes of the definition of "termination" or
"termination of employment" means the following:
(a) actual involuntary termination of your employment
status without Cause (as hereinafter defined), or
(b) actual voluntary termination of your employment at any
time within thirty (30) days of the occurrence of one (1) of
the following events:
(i) the assignment to you of any duties inconsistent with
your position, duties, responsibilities and status with
AMRESCO immediately prior to your termination, or a material
adverse change in your reporting responsibilities, titles or
offices as in effect immediately prior to your termination;
(ii) a reduction in your base salary as in effect
immediately prior to your termination;
(iii) requiring you to be based anywhere other than
either the offices at which you were based immediately prior
to your termination or offices which are no more than thirty-
five (35) miles from the location of your home immediately
prior to your termination, except for required travel on
your employer's business to an extent substantially
consistent with your business travel obligations immediately
prior to such termination; or
(iv) the failure to provide to you benefit or compensation
plans (including, but not limited to any pension plan, life
insurance plan, health and accident plan or disability plan)
which do not materially reduce the benefits from those you
enjoyed immediately prior to such termination, or the
failure to provide you with the number of paid vacation days
to which you are then entitled on the basis of years of
service with AMRESCO in accordance with XXXXXXX's normal
vacation policy in effect immediately prior to your
termination;
For purposes hereof, a "Change of Control" shall mean any
one of the following: (a) Continuing Directors (The term
"Continuing Directors" means any individual who is a member
of the Board of Directors of AMRESCO [the "Board"] on the
date hereof or was nominated for election as a director by,
or whose nomination as a director was approved by, the Board
with the affirmative vote of a majority of the Continuing
Directors.) no longer constitute a majority of the Board;
(b) any person or group of persons (as defined in Rule 13d-5
under the Securities Exchange Act of 1934, as amended {Rule
13d-5}), together with his or its affiliates, becomes the
beneficial owner, directly or indirectly, of 25% or more of
XXXXXXX's then outstanding securities entitled generally to
vote for the election of AMRESCO's directors; (c) the merger
or consolidation of AMRESCO with any other entity if AMRESCO
is not the surviving entity or any person or group of
persons (as defined in Rule 13d-5), together with his or its
affiliates, is the beneficial owner, directly or indirectly
, of 25% or more of the surviving entity's then outstanding
securities entitled generally to vote for the election of
the surviving entity's directors; or (d) the sale of all or
substantially all of the assets of AMRESCO or the
liquidation or dissolution of AMRESCO.
AMRESCO shall also pay to you an incentive bonus of the
lesser of (a) $1,500,000 or (b) five percent (5%) of the
value of the sales proceeds in excess of $120 million
received by XXXXXXX (net of equity and debt) in connection
with the sale prior to December 31, 2000 of all of the three
(3) business units of AMRESCO's Commercial Finance Division
(Builders Group, ACLC and AMRESCO Independence Funding,
Inc.). Such incentive bonus will be paid within fifteen
(15) days of the date of the closing of the sale of the last
of such business units to be sold, and will be subject to
applicable withholdings.
If you voluntarily terminate your employment (other than a
termination) or your employment with AMRESCO is terminated
by AMRESCO for Cause prior to December 31, 2000 you will not
be entitled to any payment hereunder. "Cause", as used
herein, means (1) gross misconduct or willful, substantial
violation of AMRESCO policies and procedures or (2) other
performance deficiencies, provided that you have been given
a written warning and not less than 15 days to correct such
performance deficiencies.
As these particular bonus plans are restricted to certain
key employees, it is necessary that you keep the terms of
this agreement confidential. You may disclose the existence
and terms of this agreement only to your spouse, accountant,
attorney, the IRS and to others only if required by law.
Failure to keep the terms and conditions of this agreement
confidential will be considered gross misconduct and may
result in forfeiture of the bonuses provided for herein or
termination of your employment, or both. If you have
further questions, please do not hesitate to contact me.
This letter agreement may not be assigned by you. This
letter agreement will be binding upon AMRESCO and any
successor-in-interest thereto, whether by merger,
consolidation or otherwise.
Sincerely,
Xxxxxx X. Xxxx, Xx.
President and Chief Executive Officer
ACCEPTED:
Employee Signature
Date:
