EXHIBIT 10.48
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT BETWEEN
MEDALLION FINANCIAL CORP.
AND
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This amended and restated employment agreement dated as of August 29, 1998 is by
and between Medallion Financial Corp., a Delaware corporation (the "Company"),
and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, an individual residing at [OMITTED] (the "Executive").
1. Employment. The Company shall employ the Executive, and the Executive agrees
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to serve the Company, on the terms and conditions set forth herein. The
Executive shall serve as Senior Executive Vice President and Chief Operating
Officer of the Company and shall be based at the Company's headquarters in
New York City. The Executive hereby accepts such employment hereunder, except
for absences occasioned by illness and reasonable vacation periods, and
agrees to undertake the duties and responsibilities inherent in such position
and such other duties and responsibilities as the Company shall from time to
time reasonably assign to him. Subject to the general direction of the Board
of Directors of the Company or any person to whom the Board delegates its
authority, the Executive shall use his best efforts, including the highest
standards of professional competence and integrity, and shall devote his full
business time and effort to the performance of his duties hereunder. The
Executive shall not engage in any other business activity except that the
Executive may engage from time to time in such personal investment activities
as do not interfere with his day to day responsibilities to the Company. The
Executive shall be allowed to serve as an independent member of the boards of
directors of other companies with the prior approval of the Chief Executive
Officer of the Company.
2. Compensation and Benefits.
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2.1 Salary. During the Term (as defined below) of this Agreement, the
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Executive shall be paid a salary at the rate of $250,000 per annum ("the
Base Salary"), payable as customarily paid by the Company. During the
Term of this Agreement, executive's base salary shall be reviewed at
least annually. The first such review will be made no later than May 29,
1999 and thereafter the Base Salary shall be reviewed on or before May
29 of each succeeding year. The Company, in its sole discretion, may
increase, but not decrease the base salary.
2.2 Bonus. In addition to his Base Salary, the Executive may be entitled
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to bonuses at times and amounts determined in the discretion of the
Board of Directors of the Company.
2.3 Benefits. The Executive shall be entitled to participate in all
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employee benefit programs or plans maintained by the Company from time
to time on the same basis as other similarly situated executive
employees of the Company. If the Executive elects not to participate in
any health, life, disability or other insurance plan provided by the
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Company, the Company will pay or reimburse the Executive for the direct
premium cost of Executive's participation in any other similar plan
outside the Company. The Company will pay or reimburse the lease cost of
the automobile currently leased by the Executive and upon expiration or
termination of the lease will continue to provide the Executive with a
suitable automobile for his business or and personal use. The Company
will pay or reimburse all maintenance, insurance, garage and other
operating expenses of the automobile currently leased by Executive or
any replacement provided by the Company hereunder. The Executive will be
entitled to 6 weeks paid vacation per year.
2.4 Reimbursement of Expenses. The Company shall reimburse the Executive
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in accordance with its general reimbursement policies for all ordinary
and necessary expenses incurred by the Executive on behalf of the
Company upon the presentation of appropriate supporting documentation.
2.5 Stock Options. Pursuant to a Stock Option Agreement in customary
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form, the Company will grant to the Executive pursuant and subject to
its 1996 Stock Option Plan, as amended, stock options to purchase up to
25,000 additional shares of the Company's common stock. The options
shall have a term of 10 years, and shall vest over a period of 5 years
in equal installments at the end of each full year with the first
installment vesting on the August 29, 1999 subject to earlier vesting
under the circumstances described in Section 3 below or such earlier
date as the Board of Directors may designate.
3. Term; Termination; Rights upon Termination.
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3.1 Term. The term (the "Term") of employment of the Executive hereunder
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shall commence as of the date first above written and shall continue
until August 29, 2001 unless terminated earlier in accordance with the
provisions hereof. This Agreement shall be renewed automatically for
additional one (1) year terms, unless otherwise terminated by either
party by written notice to the other given at least one year prior to
the expiration of the then current term.
3.2 Termination. The Company may at any time, terminate the employment of
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the Executive under this Agreement for Cause (as defined below), or
without cause, immediately and without any requirement of notice. The
Executive may at any time, upon 30 days prior written notice terminate
his employment under this Agreement with or without reason. The rights
and obligations of the parties upon any termination of the Executive's
employment shall be as set forth in Section 3.3. For purposes of this
Agreement the term "Cause" shall mean (i) any act of dishonesty or gross
and willful misconduct with respect to the Company, including without
limitation, fraud or theft, on the part of the Executive,(ii) conviction
of the Executive of a felony, or (iii) the Executive's failure to
perform his assigned duties hereunder after notice and a 30 day
opportunity to cure.
3.3 Rights Upon Termination. In the event that:
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(a) The employment of the Executive is terminated by the Company
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without Cause or by the Executive upon any change by the Company in
Executives function, duties or responsibilities, which change would
cause Executive's position with the Company to become one of lesser
responsibility, importance or scope from the position described in
Section 1, then, for the remainder of the then current term of
employment hereunder, (i) the Company shall pay to the Executive,
at the time otherwise due under Section 2, all Base Salary at the
rate in effect at the time of termination and (ii) the Company
shall provide to the Executive all benefits described in Section
2.3. In addition the vesting of stock options described in Section
2.5, and those granted previously, shall accelerate such that 100%
of such options shall automatically vest on the date of such
termination. The obligations of the Company pursuant to this
Section 3.3(a) shall be in lieu of any other rights of the
Executive hereunder to compensation or benefits in respect of any
period before or after the date of such termination.
(b) The Executive's employment terminates by reason of death or
disability, then the Company shall pay and provide to the Executive
or Executive's estate or other successor in interest at the time
otherwise due under Section 2 all Base Salary and benefits due to
the Executive under Section 2 through the end of the sixth month
after the month in which the termination occurs, but reduced in the
case of disability by any payments received under any disability
plan, program or policy paid for by the Company. . In addition the
vesting of stock options described in Section 2.5,and those that
were previously granted, shall accelerate such that (i) 50% of such
options less those that have already vested in accordance with
their terms, shall automatically vest on the date of such
termination. If such termination occurs prior to December 31,1998,
(ii) 75% of such options, less those that have already vested in
accordance with their terms, shall automatically vest if such
termination occurs prior to December 31,1999, and (iii) 100% of
such options, less those that have already vested in accordance
with their terms, shall automatically vest if this agreement is
renewed and such termination occurs prior to December 31,2000. The
obligations of the Company pursuant to this Section 3.3(b) shall be
and in lieu of any other rights of the Executive hereunder to
compensation or benefits in respect of any period before or after
the date of such termination and in lieu of any severance payment,
and no other compensation of any kind or any other amounts shall be
due to the Executive by the Company under this Agreement. For
purposes of this Agreement, the term "disability" shall mean the
Executive's failure to perform the services contemplated by this
Agreement as a result of his physical or mental illness or
incapacity for a period of 6 consecutive months, or a total of 240
days in any 365 day period.
(c) The employment of the Executive is terminated by the Company for
Cause, or by the Executive other than under circumstances described
in Section 3.3(a) or (b) above, the Executive shall not be entitled
to compensation or benefits granted hereunder beyond the date of
the termination of the Executive's employment.
(d) Upon the occurrence of a Change in Control as defined in Section
7, occurs, Executive's employment shall automatically terminate and
the Company
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shall pay Executive or in the event of his subsequent death, his
beneficiary, or his estate, as the case may be, as severance pay or
liquidated damages, or both a sum equal to 2.99 times: the sum of
an amount equal to (i) Executive's Base Salary in effect
immediately prior to the Change in Control plus (ii) the bonus paid
to Executive in the fiscal year prior to the Change in Control, or
if a bonus has been paid in the fiscal year in which the Change of
Control occurs, such bonus, whichever is greater. The foregoing
severance/liquidated damages payment(s) shall be made to the
Executive's surviving spouse, or if no surviving spouse, to his
estate, in the event that the Company enters into an agreement as
to a Change in Control of the Company, and Executive shall die
after such agreement is executed but prior to consummation of the
Change in Control, which payments shall commence upon, and shall be
contingent upon, the actual consummation of the Change in Control.
At the election of the Executive, which election is to be made by
January 31 of each year and is irrevocable for the year in which
made (and once payments commence), such payment may be made in a
lump sum or paid in equal bi-weekly (or as frequently as the
Company generally pays its employees) installments following the
Executive's termination. In the event that no election is made,
payment to the Executive will be made on a bi-weekly basis (or as
frequently as the Company generally pays its employees). Such
payments shall not be reduced in the event Executive obtains other
employment following termination. Also upon the occurrence of a
Change of Control the Company will continue all benefits described
in section 2.3 for a period of 36 months. The obligations of the
Company pursuant to this Section 3.3(d) shall be in lieu of any
other rights of the Executive hereunder to compensation or benefits
in respect of any period before or after the date of such
termination and in lieu of any severance payment, and no other
compensation of any kind or any other amounts shall be due to the
Executive by the Company under this Agreement.
Notwithstanding the preceding paragraphs of this Section 3.3 (d) in the
event that:
(i) the aggregate payments or benefits to be made or
afforded to Executive under said paragraph would be deemed to
include an "excess parachute payment" under section 280G of the
Internal Revenue Code of 1986 or any successor thereto, and
(ii) If such termination benefits were reduced to an amount
(the "Non-Triggering Amount"), the value of which is one dollar
($1.00) less than an amount equal to (3) times Executives "base
amount", as determined in accordance with said Section 280G,
and the Non-Triggering Amount would be greater than the
aggregate value of the termination benefits (without such
reduction) minus the amount of tax required to be paid by
Executive thereon by Section 4999 of the Code, then the
termination benefits shall be reduced to the Non-Triggering
Amount. The allocation of the reduction required hereby among
the termination benefits provided by Section 3.3 (d) shall be
determined by Executive.
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4. Proprietary Information.
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4.1 The Executive agrees that all information and know how, whether or not
in writing, of a private, secret or confidential nature concerning the
business or financial affairs of the Company and its subsidiaries
(collectively, for purposes of this Section 4, the "Company") and not
within Executive's possession or knowledge prior to his employment with
the Company (collectively, "Proprietary Information"), is and shall be
the exclusive property of the Company. By way of illustration, but not
limitation, Proprietary Information may include inventions, products,
processes, methods, techniques, projects, developments, plans, research
data, financial data, personnel data, and lists of borrowers,
advertisers, fleet and taxi owners. The Executive will not disclose any
Proprietary Information to others outside the Company or use the same
for any unauthorized purposes without written approval by the Company,
either during or after his employment, unless and until such Proprietary
Information has become public knowledge without fault of the Executive.
4.2 The Executive agrees that all files, letters, memoranda, reports,
records, data, sketches, drawings, or other written, photographic, or
other tangible material containing Proprietary Information, whether
created by the Executive or others, which shall come into his custody or
possession, shall be and are the exclusive property of the Company to be
used by the Executive only in the performance of his duties for the
Company.
4.3 The Executive agrees that his obligation not to disclose or use
Proprietary Information and records of the type set forth herein also
extends to such types of Proprietary Information, records and tangible
property of borrowers, advertisers, fleet and taxi owners or other third
parties who may have disclosed or entrusted the same to the Company or
to the Executive in the course of the Company's' business.
5. Other Agreements. The Executive hereby represents that his performance
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of all the terms of this Agreement and as an employee of the Company does not
and will not breach any agreement to keep in confidence proprietary
information, knowledge or data acquired by him in confidence or in trust
prior to his employment with the Company.
6. Non-Competition, Non- Solicitation.
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6.1 Non-solicitation of Employees and Customers. The Executive agrees that
during the term of the Executive's employment with the Company and for a
period of one year thereafter, the Executive shall not directly or
indirectly (i) recruit, solicit or otherwise induce or attempt to induce
any employees of the Company or any of its subsidiaries to leave their
employment or (ii) call upon, solicit, divert or take away, or attempt
to divert or take away, the business or patronage of any borrower,
customer licensee, vendor, collaborator or corporate partner of the
Company or any of its subsidiaries that had a business relationship with
the Company or any of its subsidiaries at the time of termination of
Executive's employment with the Company and that did not have a business
or personal relationship or was known to Executive prior to his
employment with the Company.
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6.2 Non-competition. The Executive agrees that during the term of the
Executive's employment with the Company, the Executive shall not
directly or indirectly, engage in competition with the Company or any
subsidiaries, or own or control any interest in, or act as director,
officer or employee of, or consultant to, any firm, corporation or
institution directly engaged in competition with the Company or any of
its subsidiaries: provided the Company or one of its subsidiaries are
actively engaged in such business at the time the Executive's employment
by the Company is terminated: and provided that the foregoing shall not
prevent the Executive from holding shares as a passive investor in a
publicly held company which do not constitute more than 5% of the
outstanding shares of such company.
7. Change in Control Protection. For purposes of this Agreement, a "Change
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in Control" of the Company shall mean a change in control of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended, or any similar item, schedule or form, whether or not the Company is
then subject to such reporting requirement.
8. Miscellaneous.
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8.1 Notices. All notices required or permitted under this Agreement shall
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be in writing and shall be deemed effective upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail,
postage prepaid, addressed if to the Executive, at the address shown above
and if to the Company at its principal place of business at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other address or addresses as
either party shall designate to the other in accordance with this Section
8.1.
8.2 Pronouns. Wherever the context may require, any pronouns used in this
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Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular forms of nouns and pronouns shall include the plural,
and vice versa.
8.3 Entire Agreements. This Agreement constitutes the entire agreement
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between the parties and supercedes all prior agreements and understandings,
whether written or oral, relating to the subject matter of this Agreement.
8.4 Amendment. This Agreement may be amended or modified only by a written
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instrument executed by both the Company and the Executive.
8.5 Governing Law. This Agreement shall be construed, interpreted and
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enforced in accordance with the laws of the State of Delaware.
8.6 Successors and Assigns. This Agreement shall be binding upon and inure
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to the benefit of both parties and their respective successors and assigns,
including any corporation with which or into which the Company may be merged
or which may succeed to its assets or business, provided, however, that the
obligations of the Executive are personal and shall not be assigned by him.
8.7 Waivers. No delay or omission by the Company in exercising any right
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under this Agreement shall operate as a waiver of that or any other right. A
waiver or consent
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given by the Company on any one occasion shall be effective only in this
instance and shall not be construed as a bar or waiver of any right on any
other occasion.
8.8 Captions. The captions of the sections of this Agreement are for
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convenience of reference only and in no way define, limit or affect the scope
or substance of any section of this Agreement.
8.9 Severability. In case any provision of this Agreement shall be invalid,
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illegal or otherwise unenforceable, the validity, legality and enforceability
of the remaining provisions shall in no way be affected or impaired thereby.
8.10 Specific Enforcement. The parties acknowledge that the Executive's
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breach of the provisions of Section 4 and 6 of this Agreement will cause
irreparable harm to the Company. It is agreed and acknowledged that the
remedy of damages will not be adequate for the enforcement of such provisions
and that such provisions may be enforced by equitable relief, including
injunctive relief, which relief shall be cumulative and in addition to any
other relief to which the Company may be entitled.
9. Arbitration. Any claims, controversies, demands, disputes or differences
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between or among the parties hereto or any persons bound hereby arising out of,
or by virtue of, or in connection with, or otherwise relating to this Agreement
shall be submitted to and settled by arbitration conducted in New York, New York
before one or three arbitrators each of which shall be knowledgeable in
employment law. Such arbitration shall otherwise be conducted in accordance with
the rules then obtaining of the American Arbitration Association. The parties
hereto agree to share equally the responsibility for all fees of the
arbitrators, abide by any decision rendered as final and binding, and waive the
right to appeal the decision or otherwise submit the dispute to a court of law
for a jury or non-jury trial. The parties hereto specifically agree that neither
party may appeal or subject the award or decision of any such arbitrator(s) to
appeal or review in any court of law or in equity or by any other tribunal,
arbitration system or otherwise. Judgment upon any award granted by such an
arbitrator(s) may be enforced in any court having jurisdiction thereof. If the
arbitration decision holds that one party is entirely at fault and the other
party is without fault, the party that is without fault shall be entitled to
reimbursement of fees and expenses from the losing party that is at fault in an
amount not to exceed $50,000.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year set forth above
MEDALLION FINANCIAL CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: President
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EXECUTIVE
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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