Exhibit 10.6
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is dated as of
September 30, 1998 by and between MORTGAGE MARKET, INC. ("MMI"), and XXXXXX
X. XXXXXXX ("Xxxxxxx").
R E C I T A L S:
WHEREAS, prior to the date of this Agreement, Xxxxxxx was a
shareholder of MMI;
WHEREAS, Prism Mortgage Company ("Prism"), as Prism has entered
into that certain Purchase and Sale Agreement dated as of even date
herewith (the "Purchase Agreement") between Xxxxxxx, Xxxxxxx Xxxxxxx,
Xxxxxxx Xxxxxxx and Xxxx Xxxxxxxxxxxx, as Sellers, pursuant to which Prism
has agreed to purchase all of the shares of MMI;
WHEREAS, Xxxxxxx has been employed by MMI and is currently
serving as President of MMI;
WHEREAS, upon consummation of the transactions contemplated by
the Purchase Agreement, Prism will be the sole shareholder of MMI;
WHEREAS, MMI desires to retain the services of Xxxxxxx, as an
employee of MMI and, to that end, desires to enter into this contract of
employment with Xxxxxxx, upon the terms and conditions herein set forth;
and
WHEREAS, Xxxxxxx desires to continue employment with MMI upon
such terms and conditions, and acknowledges that such terms and conditions,
including but not limited to the covenants contained in Section 7 hereof,
constitute material inducements for Prism to enter into and effect the
transactions contemplated in the Purchase Agreement and for MMI to employ
Xxxxxxx pursuant to this Agreement.
NOW, THEREFORE, in consideration of the above recitals, the
promises and covenants herein contained, Ten and No/l00 Dollars ($10.00),
and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties agree as follows:
1. DEFINITION
(a) "AFFILIATE" shall mean any legal entity or person which
directly or indirectly, through one or more intermediaries, owns
and controls, or is owned and controlled by, a company. The term
"control" means the power to direct or cause the direction of the
management and policies of an entity; "ownership" shall mean
ownership of 25% or more of the voting power or equity value of a
company or 25% or more of a capital and profits interest of an
unincorporated entity.
(b) "BUSINESS" shall mean MMI's residential mortgage lending
and brokerage operations, as well as all secondary market
transactions conducted by, or on behalf of, MMI.
(c) "CLOSING" shall mean the date on which MMI is sold
pursuant to the Purchase Agreement.
(d) "MMI NET INCOME" shall equal MMI's Mortgage Banking Net
Income plus all other income generated by the MMI Operations
calculated in accordance with GAAP, including, without limitation,
revenues from loan origination minus (i) all operational,
administrative and out-of-pocket expenses including, without
limitation, all underwriting and closing costs, directly associated
with MMI Operations and (ii) all indirect or other expenses of
Prism and its Affiliates to the extent they are associated with
services provided to MMI and apply to MMI Operations (including,
without limitation, accounting, financial, legal and other services
relating to the provision of technology, human resources,
accounting, insurance, national marketing, national senior
management and otherwise provided by national senior management)
allocated to or on behalf of MMI based on the ratio of the number
of loans closed by MMI in any period compared to the number of
loans closed by Prism and its Affiliates including those closed by
MMI in such period, provided that no such indirect expenses of
Prism incurred in the sixty (60) days immediately following the
Closing shall be allocated to MMI, provided further that any costs
or a portion of any costs related to [*] that MMI has incurred, or
incurred on behalf of MMI, which are necessitated solely by the [*]
of MMI Operations with Prism and incurred within [*] days
immediately following the Closing rather than the [*] of MMI
Operations, such as [*]. For purposes of this Agreement, MMI Net
Income shall be computed on a pretax basis so long as MMI and Prism
are S Corporations, but shall be computed on an after-tax basis for
such periods as MMI and Prism are C Corporations if and when MMI
and Prism become C Corporations.
(e) "MMI OPERATIONS" shall mean (i) all current operations of
MMI existing as of the Closing plus (ii) any new operations
(including acquisitions) which are expressly approved as a MMI
Operation by Prism in writing, in its reasonable discretion.
(f) "MMI'S MORTGAGE BANKING NET INCOME" shall include all
service release premiums, incentive income, gain on sale income,
interest income, income generated as a result of bulk sales,
assignment of trade or co-issuer transactions and all similar
income and fees generated from the sale of loans in the secondary
market and shall be computed on a product-by-product basis by
calculating the total gross revenues generated by each product for
MMI and Prism and its Affiliates. Such gross revenue shall be
allocated as MMI Mortgage Banking Net Income based on (i) [*] MMI,
Prism or its Affiliates (including MMI) [*] Prism and its
Affiliates (including the MMI loans) multiplied by (ii) [*] from
which total (i.e., the aggregate sum of the foregoing calculations
[*]) is subtracted the following: (A) all mortgage banking expenses
incurred in connection with such revenues [*] MMI and funded by
Prism or its Affiliates (including MMI) relative to [*] Prism or
its Affiliates [*]; (B) all hedging costs (e.g., all costs,
including transaction costs, of purchasing and selling marketable
securities obtained to hedge pipeline loans against interest rate
risk together with the pair-off losses and gains associated with
such xxxxxx) allocated to MMI [*] MMI and funded by Prism or its
Affiliates (including MMI) [*] Prism or its Affiliates [*], (C) any
costs and expenses associated with any repurchase obligations of
MMI to the extent they are not solely caused by Prism and its
Affiliates other than MMI, and (D) any special fees paid to, or
reduced premiums received from, purchasers of loan product of MMI,
Prism or its Affiliates due to [*] such loan products closed by MMI
(e.g., surcharges by purchasers of loans based on [*] the loans)
and (E) adjusted further by adding or subtracting any [*] reflected
on the rate sheet of MMI distributed to its loan officers vis-a-vis
the rate sheets of Prism and its Affiliates (other than MMI)
distributed to their loan officers.
By way of example, assume [*].
MMI Mortgage Banking Net Income would equal [*].
2. EMPLOYMENT TERM.
(a) INITIAL TERM. The Term of this Agreement ("Term") shall
commence on the date hereof, and shall end on the first anniversary
date of this Agreement, unless otherwise terminated as set forth
herein. Upon the written request of Xxxxxxx at least ninety (90)
days prior to the end of the Term of this Agreement, the parties
hereto shall in good faith enter into negotiations regarding the
renewal of this Agreement.
(b) RENEWAL TERM(S). This Agreement may be renewed for
subsequent one-year terms, at the compensation and upon the other
terms and conditions set forth herein or as otherwise agreed by the
parties hereto ("Renewal Term(s)") upon the mutual agreement of the
parties hereto at least forty-five (45) days prior to the
expiration of the Term or the then current Renewal Term.
3. MANAGEMENT RESPONSIBILITIES AND OTHER DUTIES. During the
Term, Xxxxxxx shall serve as President of MMI and shall have the
responsibilities set forth in Exhibit A (the "Principal Responsibilities").
Xxxxxxx, together with the other senior officers of MMI, and subject to
MMI's Board of Directors' ("Board") control and direction, shall be
responsible for the management of the day-to-day operations of the
Business. Xxxxxxx shall devote substantially all of his time during
business hours (reasonable sick leave and vacations excepted), and shall
use his best efforts, to fulfill faithfully, responsibly and to the best of
his ability, his Principal Responsibilities and other duties to MMI. Other
than those decisions requiring board or shareholder consent or approval
under MMI's articles of incorporation, bylaws or applicable state law, and,
subject to Prism and the Board's control and direction, Xxxxxxx shall have
decision-making authority similar to such authority afforded Xxxxxxx by MMI
during the twelve (12) month period immediately preceding the date of this
Agreement. In addition to his Principal Responsibilities, Xxxxxxx shall
have those duties, responsibilities and authority as shall be reasonably
required or authorized by the Board, from time to time, provided that none
of the duties set forth in Exhibit A may be reduced or limited without the
prior consent of Xxxxxxx, except for a change or reduction of such
responsibilities based on Xxxxxxx' failure to perform certain
responsibilities described in Exhibit A, which failure is not corrected by
Xxxxxxx within 30 days after such failure is communicated to Xxxxxxx in
writing during his annual performance review or otherwise communicated in
writing and which change or reduction is authorized by the Board of MMI in
its sole discretion.
4. NATIONAL ADVISORY BOARD. Prism shall appoint Xxxxxxx as a
member of a "National Advisory Board," to be established by Prism, during
the Term of this Agreement. In the event Xxxxxxx is no longer employed by
MMI on the date which is five (5) years from the Closing Date, Xxxxxxx
shall resign from such National Advisory Board but may appoint a
replacement member, who shall be an employee of MMI, to serve for the
remainder of such five (5) year period.
5. COMPENSATION.
(a) SALARY. During the Term of this Agreement, in addition
to any other amounts due Xxxxxxx pursuant to Section 5 hereof, to
the extent Xxxxxxx remains employed by MMI, MMI shall pay Xxxxxxx x
xxxxx annual salary, prior to required withholdings, equal to One
Hundred Fifty Thousand and No/100 ($150,000.00), payable in
twenty-four (24) equal installments on the fifteenth (15th) and the
last day of each month.
(b) BONUS. Beginning in 1999 and throughout the Term of this
Agreement, and subject to the provisions of Section 11 hereof, MMI
shall pay Xxxxxxx bonus compensation of $50,000 if the MMI Net
Income exceeds $1,000,000 in the twelve (12) month period following
the Closing Date ("Bonus"), which shall be paid to Xxxxxxx within
sixty (60) days of the close of such period.
(c) BENEFITS. Xxxxxxx shall be entitled, while employed by
MMI, to such employee benefits set forth in Exhibit B, attached
hereto and made a part hereof, and, in addition and without
reducing or limiting the benefits set forth in Exhibit B, shall
have the benefits, including, without limitation, health insurance,
which are in effect from time to time, and offered by MMI to its
other management employees generally and in accordance with the
policies promulgated by the Board. Xxxxxxx shall also be entitled
to (i) occupy an office of similar size with similar furnishings as
that occupied by Xxxxxxx prior to the Closing, and (ii) secretarial
and administrative support services at least equivalent, as
determined by MMI, to such services available to Xxxxxxx prior to
the Closing. In addition, Xxxxxxx shall also be entitled to
receive two (2) Portland Trailblazers season tickets, provided that
such tickets shall be used in part for MMI business and business
entertainment purposes.
(d) VACATION; HOLIDAYS; SICK DAYS. Xxxxxxx shall be entitled
to six (6) weeks of vacation per calendar year (two (2) weeks for
the balance of 1998), and paid holidays and sick leave in
accordance with the policies for management and employees
promulgated by the Board, then in effect.
6. TERMINATION; RIGHT OF SETOFF. This Agreement may be
terminated by the Board of MMI only"with cause." For purposes of this
provision, "with cause" shall mean an involuntary discharge by MMI for any
of the following:
(a) conviction of fraud, embezzlement, or theft;
(b) disclosing of confidential or proprietary information of
MMI, Prism or their Affiliates; aiding a competitor of MMI, Prism
or their Affiliates; or misappropriation of a corporate opportunity
of MMI, Prism or their Affiliates, which disclosure, aid or
misappropriation breaches Xxxxxxx' fiduciary duty to MMI as an
officer or employee of MMI;
(c) conviction of a felony or entry of any guilty plea or
plea of nolo contendere to a felony;
(d) conviction of, or entry of any guilty plea or plea of
nolo contendere to, any criminal charge (1) resulting in MMI, Prism
or their Affiliates being in violation of any mortgage brokerage
licensing act in any state in which MMI, Prism or their Affiliates
are then licensed or relating to the business of MMI, Prism or
their Affiliates; (2) involving moral turpitude resulting in harm
or embarrassment to MMI, Prism or their Affiliates;
(e) any material misrepresentation to MMI or Prism by Xxxxxxx
in connection with Xxxxxxx' employment hereunder;
(f) gross negligence in performance of any Principal
Responsibilities;
(g) any charge brought in a court of competent jurisdiction
or with an appropriate regulatory agency of unlawful tortious
conduct involving moral turpitude or unlawful discrimination is
made against Xxxxxxx which MMI or Prism reasonably and in good
faith believes to be credible, which charge results in (i)
substantial and material damage or harm to the business of MMI,
Prism, or their Affiliates; or (ii) negative publicity which
embarrasses and materially damages the image or reputation of MMI,
Prism, or their Affiliates;
(h) failure or breach in performing or complying with any
obligations under this Agreement or in performing any Principal
Responsibilities (which shall include, without limitation, repeated
negligent acts or omissions, or repeated incompetent performance of
Principal Responsibilities) after Xxxxxxx has been given written
notice specifying the nature of the failure or breach and has
failed to correct or discontinue such failure or breach within
thirty (30) days after such notice.
RIGHT OF SETOFF. In addition to the rights to terminate referred
to above, MMI and Prism shall have the right to setoff against any amounts
due Xxxxxxx, or his heirs or devisees, hereunder, any expense or damages
incurred or suffered by MMI or Prism, including, but not limited to,
attorneys' fees and costs, due to, or relating to, any breach or default by
Xxxxxxx under the terms of, or in connection with, the Purchase Agreement,
to the extent Prism is entitled to indemnification under, and in accordance
with, the provisions of Section 10.3 of the Purchase Agreement, provided
that such amounts are due and owing to MMI or Prism and are allowed under
applicable law.
7. COVENANTS OF XXXXXXX. The following covenants are made by and
between Xxxxxxx and MMI in consideration of the undertakings in this
Agreement and the transaction contemplated by the Purchase Agreement, and
it is expressly acknowledged and agreed by Xxxxxxx that such covenants are
material inducements for MMI to enter into this Agreement, and for Prism to
consummate the transaction contemplated by the Purchase Agreement. The
following covenants are also made in consideration of the Term of this
Agreement, and any subsequent Renewal Terms, as provided in Section 2
hereof, and the compensation to be paid Xxxxxxx as provided in Section 7
hereof. In addition, Xxxxxxx acknowledges that MMI and its Affiliates,
including, without limitation, Prism, expend considerable time, money and
resources in recruiting, training and developing the skills and abilities
of their employees; developing business relationships with referral sources
and customers so as to improve the good will of MMI; establishing branches
of MMI, including, but not limited to, entering into a long-term lease for
office space; establishing and maintaining close business relationships
between MMI's employees and MMI's customers; and obtaining, compiling and
developing confidential customer lists, various internal computer reports
and other proprietary business information not readily available to the
public or through other sources. Subject to the provisions of Section 7,
Xxxxxxx acknowledges and agrees that MMI is entitled to protect its
investment in the foregoing and to keep the results of its efforts for its
exclusive use. Accordingly, Xxxxxxx agrees to the covenants and conditions
set forth in Sections 7(a) through 7(d) hereof, and acknowledges and agrees
that they are necessary to preserve and protect the legitimate business
interests of MMI, and shall be binding upon Xxxxxxx during and after
Xxxxxxx' employment with MMI in accordance with their terms:
(a) CONFIDENTIALITY. During the course of Xxxxxxx'
employment, Xxxxxxx will have access to certain trade secrets and
other proprietary and confidential business information regarding
MMI, the Business and the business of MMI's Affiliates. Xxxxxxx
acknowledges, covenants and agrees that such information is, and
shall remain, the property of MMI and/or its Affiliates. Except on
behalf of MMI as Xxxxxxx' duties may require, Xxxxxxx shall keep
confidential and shall not divulge to any other person or entity,
and shall not use for Xxxxxxx' own benefit, or the benefit of
others, during Xxxxxxx' employment or after Xxxxxxx' employment is
terminated by either party hereto for any reason, any information
relating to MMI or the Business, or otherwise pertaining to
Xxxxxxx' employment, or of the business secrets or other
confidential information regarding MMI and its Affiliates which
have not otherwise become public knowledge; provided, however, that
nothing in this Agreement shall preclude Xxxxxxx from disclosing
necessary or appropriate information (i) to parties retained to
perform services for MMI or its Affiliates; (ii) under any other
circumstances to the extent such disclosure is appropriate or
necessary to further the best interests of MMI or its Affiliates;
or (iii) as may be required by law or to be disclosed in any
governmental, administrative, judicial or quasi-judicial proceeding
(providing that Xxxxxxx permits MMI or its Affiliates the
opportunity to quash or oppose any subpoena or any other attempt to
force Xxxxxxx to provide information in such forums and cooperates
in such effort). For the purposes of this Agreement, confidential
business information shall have its ordinary and customary meaning
and shall include, without limitation: all business and marketing
plans, customer and prospect lists concerning referral sources,
lists of employees of MMI and its Affiliates, lists of the
existence and locations of existing or planned branches of the
Business, computer programs, internal business reports, agreements,
manuals, loan documents (including form documents such as MMI's
loan pricing disclosure agreements and the like), training
materials, marketing materials (including, without limitation,
newsletters and correspondence), financial information, information
concerning financial arrangements with outside lending
institutions, terms of vendor agreements, internal pricing, and fee
and cost information, which are confidential or treated as
confidential business information by MMI. Notwithstanding the
foregoing, confidential information covered by this Agreement shall
not include (i) agreements, information, loan documents and other
materials which are in the public domain and which Xxxxxxx receives
or obtains after his employment hereunder; and (ii) Xxxxxxx'
skills, knowledge of the trade, judgment, training and experience
(other than knowledge unique to or gained exclusively from MMI).
(b) RECORDS. All documents, records, programs, computer
media, files and lists (including all originals and all copies)
containing trade secrets or confidential business information, and
all papers, books, documents, forms, handbooks, reports, computer
disks and tapes, training manuals, lending manuals and records of
every kind and description relating to the business and affairs of
MMI or its Affiliates, whether or not prepared by Xxxxxxx, and all
tangible items obtained by Xxxxxxx in the scope of or during the
course of employment, and related to the Business, and the business
of MMI's Affiliates, including, without limitation, phones, keys,
computers, credit cards, lists, manuals, office equipment,
furniture, and the like, shall be the sole and exclusive property
of MMI, and Xxxxxxx shall surrender them to MMI upon termination of
this Agreement, or at any time upon the request of MMI.
Notwithstanding the foregoing, the restrictions in this Subsection
7(b) shall not include materials regarding the mortgage business in
general to the extent that such materials have been gathered by
Xxxxxxx at his own cost and expense and tangible materials such as
office equipment, furniture and the like to the extent purchased by
Xxxxxxx at his own cost and expense or received by Xxxxxxx as a
gift.
(c) ENFORCEMENT. Xxxxxxx recognizes that the provisions of
this Section 7 are vitally important to the continuing welfare of
MMI and its Affiliates and that money damages constitute an
inadequate remedy for any violation thereof. Accordingly, in the
event of any such violation by Xxxxxxx, MMI and the Affiliates, in
addition to any other remedies they may have, shall have the right
to institute and maintain a proceeding to compel specific
performance thereof or to issue an injunction restraining any
action by Xxxxxxx in violation of this Section 7, without the
necessity of posting a bond.
(d) SURVIVAL OF COVENANTS. The provisions of this Section 7
shall survive termination of Xxxxxxx' employment for any reason.
8. EXCLUSIVITY. Xxxxxxx hereby represents, covenants and
warrants that as of the date of this Agreement, Xxxxxxx is bound by no
other employment agreement, consulting agreement, non-competition agreement
or other similar such agreement with a party other than MMI, Prism and the
Affiliates, except for this Agreement. Furthermore, during the term of his
employment hereunder, Xxxxxxx shall not enter into, or otherwise become
bound by, any other employment agreement, consulting agreement, or
non-competition agreement or other similar such agreement other than with
MMI, Prism and its Affiliates.
9. NOTICES. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have
been duly given if delivered by hand or mailed within the continental
United States by first class certified mail, return receipt requested,
postage prepaid, addressed as follows:
(a) If to MMI, to: c/o Prism Mortgage Company
000 Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxx, Esq.
Facsimile No.: (000) 000-0000
(b) If to Xxxxxxx, to: Xxxxxx X. Xxxxxxx
c/o Mortgage Market, Inc.
0 Xxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxx Xxxxxx, Xxxxxx 00000
Such addresses may be changed by written notice sent to the other party at
the last recorded address of that party.
10. TAX WITHHOLDING. MMI shall provide for the withholding of any
taxes required to be withheld by federal, state and local law with respect
to any payment in cash and/or other property made by or on behalf of MMI to
or for the benefit of Xxxxxxx under this Agreement, or otherwise made in
connection with Xxxxxxx' employment with MMI.
11. NO ASSIGNMENT. Except as otherwise expressly provided herein,
this Agreement is not assignable by either party hereto and no payment to
be made hereunder shall be subject to alienation, sale, transfer,
assignment, pledge, encumbrance or other charge provided that an assignment
of this Agreement by MMI to an Affiliate or by operation of or in
connection with the merger, sale of stock or a sale of all or substantially
all the business or assets of MMI or Prism shall not be deemed an
assignment covered by such prohibition. Except as expressly set forth
herein, this Agreement is not intended to confer upon any other person or
entity any rights or remedies hereunder and shall be binding upon and inure
to the benefit solely of each party hereto.
12. RELATIONSHIP BETWEEN MMI AND XXXXXXX. The relationship
between MMI and Xxxxxxx is that of employer and employee only. Xxxxxxx
shall have no authority to enter into any contracts binding upon MMI or to
create any obligations on the part of MMI, except such authority as has
been or from time to time shall be authorized by the Board.
13. EXECUTION IN COUNTERPARTS. This Agreement may be executed by
the parties hereto in two or more counterparts, each of which shall be
deemed to be an original, but all such counterparts shall constitute one
and the same instrument, and all signatures need not appear on any one
counterpart.
14. SEVERABILITY. If any provision of this Agreement shall be
adjudged by any court of competent jurisdiction to be invalid or
unenforceable for any reason, such judgment shall not affect, impair or
invalidate the remainder of this Agreement. Furthermore, if the scope of
any restriction or requirement contained in this Agreement is too broad to
permit enforcement of such restriction or requirement to its full extent,
then such restriction or requirement shall be enforced to the maximum
extent permitted by law, and Xxxxxxx consents and agrees that any court of
competent jurisdiction may so modify such scope in any proceeding brought
to enforce such restriction or requirement.
15. PRIOR UNDERSTANDINGS. This Agreement together with the
employment manuals and policies of MMI and subsequent addenda and
amendments hereto and thereafter to the extent not inconsistent with this
Agreement embody the entire understanding of the parties hereto regarding
the employment relationship of MMI with Xxxxxxx, provided that nothing in
the Purchase Agreement shall be deemed to be affected or impaired by this
provision, and supersede all other oral or written agreements or
understandings between them, regarding such employment relationship, it
being understood that all previous agreements relating to Xxxxxxx'
employment existing between MMI and Xxxxxxx are hereby deemed to be null
and void and replaced hereby. No change, alteration or modification hereof
may be made except in a writing, signed by each of the parties hereto. The
headings in this Agreement are for convenience and reference only and shall
not be construed as part of this Agreement or to limit or otherwise affect
the meaning hereof.
16. ARBITRATION.
(a) NEGOTIATION. EXCEPT FOR CONTROVERSIES, DISPUTES OR
CLAIMS RELATED TO OR BASED ON XXXXXXX' ALLEGED BREACH OF THE
COVENANTS IN SECTION 7, FOR WHICH MMI MAY SEEK INJUNCTIVE OR SUCH
OTHER RELIEF AS SUCH PARTY MAY DEEM APPROPRIATE, OR CLAIMS BROUGHT
BY CONSUMERS OR GOVERNMENTAL AUTHORITIES, NEITHER PARTY SHALL
INSTITUTE ANY PROCEEDING IN ANY COURT OR ADMINISTRATIVE AGENCY OR
ANY ARBITRATION TO RESOLVE A DISPUTE ARISING HEREUNDER BETWEEN THE
PARTIES BEFORE THAT PARTY HAS SOUGHT TO RESOLVE THE DISPUTE THROUGH
DIRECT NEGOTIATION WITH THE OTHER PARTY. IF THE DISPUTE IS NOT
RESOLVED WITHIN THREE WEEKS AFTER A DEMAND FOR DIRECT NEGOTIATION,
THE PARTIES SHALL THEN ATTEMPT TO RESOLVE THE DISPUTE THROUGH
ARBITRATION AS PROVIDED IN THIS SECTION.
(b) SCOPE OF ARBITRATION. EXCEPT FOR CONTROVERSIES,
DISPUTES OR CLAIMS RELATED TO OR BASED ON AN ALLEGED BREACH OF
XXXXXXX' COVENANTS IN SECTION 7, FOR WHICH MMI MAY SEEK
INJUNCTIVE OR SUCH OTHER RELIEF AS SUCH PARTY MAY DEEM
APPROPRIATE, OR CLAIMS BROUGHT BY CONSUMERS OR GOVERNMENTAL
AUTHORITIES, ALL CONTROVERSIES, DISPUTES OR CLAIMS BETWEEN MMI
AND XXXXXXX ARISING OUT OF OR RELATED TO THIS AGREEMENT,
INCLUDING WITHOUT LIMITATION THE VALIDITY OF THIS AGREEMENT,
WILL BE SUBMITTED FOR BINDING ARBITRATION TO THE PORTLAND,
OREGON OFFICE OF AMERICAN ARBITRATION ASSOCIATION ON DEMAND OF
XXXXXXX OR MMI. SUCH ARBITRATION PROCEEDING WILL BE CONDUCTED
IN PORTLAND, OREGON AND, EXCEPT AS OTHERWISE PROVIDED IN THIS
AGREEMENT, WILL BE HEARD BY ONE ARBITRATOR IN ACCORDANCE WITH
THE THEN CURRENT RULES OF THE AMERICAN ARBITRATION
ASSOCIATION. ALL MATTERS RELATING TO ARBITRATION WILL BE
GOVERNED BY THE FEDERAL ARBITRATION ACT (9 U.S.C. SECTIONS 1
ET SEQ.) AND NOT BY ANY STATE ARBITRATION LAW.
THE DECISION AND AWARD OF THE ARBITRATOR SHALL BE BINDING
AND CONCLUSIVE UPON BOTH XXXXXXX AND MMI, AND ENFORCEABLE IN
ANY COURT OF COMPETENT JURISDICTION. THE ARBITRATOR WILL HAVE
THE RIGHT TO AWARD OR INCLUDE IN THE AWARD ANY LAWFULLY
APPROPRIATE RELIEF AND TO ASSESS COSTS OR EXPENSES TO ONE OR
BOTH PARTIES.
XXXXXXX AND MMI AGREE TO BE BOUND BY THE PROVISIONS OF
ANY LIMITATION ON THE PERIOD OF TIME IN WHICH CLAIMS MUST BE
BROUGHT UNDER APPLICABLE LAW OR THIS AGREEMENT, WHICHEVER
EXPIRES EARLIER. XXXXXXX AND MMI FURTHER AGREE THAT, IN
CONNECTION WITH ANY SUCH ARBITRATION PROCEEDING, EACH MUST
SUBMIT OR FILE ANY CLAIM WHICH WOULD CONSTITUTE A COMPULSORY
COUNTERCLAIM (AS DEFINED BY RULE 13 OF THE FEDERAL RULES OF
CIVIL PROCEDURE) (EXCEPT ONE THAT COULD BE FILED UNDER ANOTHER
AGREEMENT HAVING ITS OWN ARBITRATION AGREEMENT) WITHIN THE
SAME PROCEEDING AS THE CLAIM TO WHICH IT RELATES. ANY SUCH
CLAIM WHICH IS NOT SUBMITTED OR FILED AS DESCRIBED ABOVE WILL
BE FOREVER BARRED.
EACH PARTY AGREES THAT ARBITRATION WILL BE CONDUCTED ON
AN INDIVIDUAL, NOT A CLASS-WIDE, BASIS, AND THAT AN
ARBITRATION PROCEEDING BETWEEN XXXXXXX AND MMI MAY NOT BE
CONSOLIDATED WITH ANY OTHER ARBITRATION PROCEEDING BETWEEN
XXXXXXX OR MMI, AS APPLICABLE, AND ANY OTHER PERSON,
CORPORATION, LIMITED LIABILITY COMPANY OR PARTNERSHIP, OR,
EXCEPT UPON THE EXPRESS WRITTEN CONSENT OF THE PARTIES HERETO,
WITH ANY ARBITRATION PROCEEDING COMMENCED BY MMI OR XXXXXXX
UNDER ANY OTHER AGREEMENT.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN
THIS SECTION, XXXXXXX AND MMI SHALL EACH HAVE THE RIGHT IN A
PROPER CASE TO OBTAIN TEMPORARY RESTRAINING ORDERS AND
TEMPORARY OR PRELIMINARY INJUNCTIVE RELIEF FROM A COURT OF
COMPETENT JURISDICTION; PROVIDED, HOWEVER, THAT XXXXXXX OR MMI
MUST CONTEMPORANEOUSLY SUBMIT THE DISPUTE FOR ARBITRATION ON
THE MERITS AS PROVIDED HEREIN.
THE PROVISIONS OF THIS SECTION WILL CONTINUE IN FULL
FORCE AND EFFECT SUBSEQUENT TO AND NOTWITHSTANDING THE
EXPIRATION OR TERMINATION OF THIS AGREEMENT.
(c) GOVERNING LAW. ALL MATTERS RELATING TO ARBITRATION WILL
BE GOVERNED BY THE FEDERAL ARBITRATION ACT (9 U.S.C. SECTIONS 1 ET
SEQ.). EXCEPT TO THE EXTENT GOVERNED BY OTHER FEDERAL LAW, THIS
AGREEMENT AND ALL CLAIMS ARISING FROM THE EMPLOYMENT RELATIONSHIP
BETWEEN MMI AND XXXXXXX WILL BE GOVERNED BY THE LAWS OF THE STATE
OF OREGON AND THE UNITED STATES OF AMERICA WITHOUT REGARD TO ITS
CONFLICT OF LAWS PRINCIPLES.
(d) WAIVER OF JURY TRIAL. MMI AND XXXXXXX IRREVOCABLY WAIVE
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER AT
LAW OR IN EQUITY, BROUGHT BY EITHER OF THEM AGAINST THE OTHER.
(e) CONSENT TO JURISDICTION. EACH PARTY AGREES THAT THE
OTHER PARTY MAY INSTITUTE ANY ACTION AGAINST IT (WHICH IS NOT
REQUIRED TO BE ARBITRATED HEREUNDER OR UNDER ANOTHER ARBITRATION
AGREEMENT IN ANY OTHER AGREEMENT) IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION LOCATED IN THE CITY OF PORTLAND, STATE OF
OREGON, AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF SUCH COURTS
AND WAIVES ANY OBJECTION IT MAY HAVE TO EITHER THE JURISDICTION OF
OR VENUE IN SUCH COURTS.
IN WITNESS WHEREOF, this Agreement is effective as of the day and
year first above written.
MORTGAGE MARKET, INC.
By:/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxx X. Xxxxxxx
------------------------------ --------------------------
Title: President Xxxxxx X. Xxxxxxx
-----------------------
ACKNOWLEDGED BY:
PRISM MORTGAGE COMPANY
By:/s/ Xxxxx Xxxxxx
---------------------------
Title:Vice President
---------------------
