SEVERANCE, SEPARATION AND RELEASE AGREEMENT
SEVERANCE,
SEPARATION AND RELEASE AGREEMENT
This
Severance, Separation and Release Agreement (“Agreement”) is entered into as of
this 4th
day of
November, 2005, between Matrix Bancorp, Inc. (the ‘Company”), and ▇▇▇▇▇ ▇▇▇▇▇
(the “Director”).
RECITALS
WHEREAS,
as of
the date hereof, the Company has commenced a private placement offering of
its
common stock (the “Offering”), the proceeds of which are to be used to fund an
issuer tender offer, in which certain members of the Company’s current senior
management have agreed to tender all of their shares of common stock and resign
from both their management positions and their positions as members of the
board
of directors of the Company and its subsidiaries upon completion of the
Offering;
WHEREAS,
the
Company’s Board of Directors and Director have agreed and desire to memorialize
that, in consideration for Director agreeing to resign from the Board of
Directors of the Company as of the closing of the Offering, Director shall
receive a payment from the Company shortly after the closing of the
Offering;
NOW,
THEREFORE,
in
consideration of the mutual promises and the terms and conditions set forth
below and other obligations under this Agreement, the Company and the Director
(collectively referred to as the “‘Parties”) hereby agree as
follows:
AGREEMENT
1. Effectiveness
of Agreement.
This
Agreement is effective as of the date first set forth above; provided, however,
to the extent the Offering is not consummated, this Agreement shall be null
and
void and of no further effect.
2. Payment
to Director.
In
consideration for Director’s resignation from the Board of Directors of the
Company as of the closing of the Offering (the “Resignation Date”), the Company
agrees to provide Director with a payment of seventy five thousand dollars
($75,000) one month after the closing of the Offering by wire transfer based
upon instructions given by Director to the Company.
3. Benefits.
(a) For
a period of eighteen (18) months from the Resignation Date, the Director shall
have the right to continue coverage under the Company’s medical and dental
insurance programs as provided by the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended (“COBRA”), and the Company shall reimburse such amount
of the expense as it pays generally for its employees.
(b) Except
as
set forth in this Section 3 and as required by applicable law, the Director
shall not be entitled to participate in any benefit plans or programs provided
by the Company or its subsidiaries following the Resignation Date.
4. No
Other Payments Due.
Except
as provided in Section 2 and Section 3 hereof, the Director shall not be
entitled to any payments or other benefits following the Resignation Date.
The
Director further acknowledges that, subject to the above-referenced exceptions,
there is no other compensation arising out of or as a result of his service
as a
director of the Company.
5. Release
and Indemnification.
(a) In
consideration of the above, the sufficiency of which the Director hereby
acknowledges, the Director, as of the Resignation Date, on behalf of the
Director and the Director’s heirs, executors and assigns, agrees to release and
forever discharge the Company and each of the Company’s shareholders, parents,
affiliates, subsidiaries, divisions, any and all current and former directors,
officers, employees, agents, and contractors and their heirs and assigns, and
any and all employee pension benefit or welfare benefit plans of the Company,
including current and former trustees and administrators of such employee
pension benefit and welfare benefit plans (the “Released Parties”), from all
claims, charges, or demands, in law or in equity, whether known or unknown,
which may have existed or which may now exist from the beginning of time to
the
date of this Agreement, including, without limitation, any claims the Director
may have arising from or relating to the Director’s service as a director of the
Company. The release provided for herein includes a release by the Director
of
any claims in any way related to the Director’s service as a director with, or
resignation from, the Company. The
Director understands that this is a general waiver and release of all claims,
known or unknown, that the Director may
have against the Released Parties based on any act, omission, matter, cause
or
thing that occurred through the date the Director signs
this Agreement.
This
release does not release the Company from any obligations due to the Director
under this Agreement, or from any rights, claims or coverages to which Director
may be entitled in respect of or under any former, current or future insurance
policies of the Company and its affiliates.
(b)
In
consideration of the above, the sufficiency of which the Company hereby
acknowledges, as of the Resignation Date, the Company and its successors and
assigns agrees to release and forever discharge the Director and the Director’s
heirs, executors and assigns, from all claims, charges, or demands, in law
or in
equity, whether known or unknown, which may have existed or which may now exist
from the beginning of their period of service as a director of the Company
to
the Resignation Date, except for breaches regarding disclosure of confidential
information or for conduct involving theft, fraud or embezzlement.
(c) It
is a
condition hereof, and it is the Parties’ intention in the execution of the
general release in this Section 5, that the same shall be effective as a bar
to
each and every claim hereinabove specified.
(d) From
and
after the Resignation Date, the Company shall indemnify and hold harmless the
Director against any costs or expenses (including reasonable attorney’s fees),
judgments, fines, losses, claims, damages or liabilities incurred in connection
with any claim, action, suit, proceeding or investigation, arising out of
matters existing or occurring at or prior to the Resignation Date, whether
asserted or claimed prior to, at or after the Resignation Date, arising in
whole
or in part out of or pertaining to the fact that he was a director of the
Company to the fullest extent which such Director would be entitled under the
Amended and Restated Articles of Incorporation and
Bylaws of the Company and Colorado law as in effect on the date
hereof.
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6. No
Admission.
This
Agreement is not an admission by either the Company or the Director of any
wrongdoing or liability.
7. No
Authority to Bind the Company.
As of
the Resignation Date, neither the Director, nor any partner, agent or employee
of the Director, has authority to enter into any contracts that bind the Company
or creates obligations on the part of the Company.
8. Non-Disparagement.
As of
the Resignation Date, the Director agrees not to make any oral or written
statements or otherwise engage in any act that is intended or may reasonably
be
expected to harm the reputation, business, prospects or operations of the
Company or any of its respective directors or executive officers or any persons
related to the foregoing. As of the Resignation Date, the Company further agrees
not to, and to use its reasonable best efforts to ensure that its directors
and
executive officers will not, make any oral or written statements to employees
or
members of the Board of Directors of the Company or other outside individuals
or
otherwise engage in any act which is intended or may reasonably be expected
to
harm the reputation, business or prospects of the Director.
9. Confidentiality.
(a) The
Director recognizes and acknowledges that the Company’ and its affiliates’ trade
secrets and confidential or proprietary information, are valuable, special
and
unique assets of their respective
businesses. For purposes of this Agreement, a trade secret or confidential
or
proprietary information shall mean and include information treated as
confidential or as a trade secret by the Company or its affiliates, including
but not limited to information regarding contemplated products, business and
financial methods or practices, marketing techniques, customers, vendors,
suppliers, trade secrets, training programs, manuals or materials, technical
information, contracts, systems, procedures, mailing lists, know-how, trade
names, improvements, pricing, price lists, or other data, business plans,
litigation, regulatory investigations, strategy, code books, invoices and other
financial statements, computer programs, software systems, databases, discs
and
printouts, other plans (technical or otherwise), customer and industry lists,
supplier lists, correspondence, internal reports, personnel files, Director
compensation, sales and advertising material which is or was used in the
business of the Company or its affiliates.
(b)
As
of the
Resignation Date, the Director will not, in whole or in part, disclose such
trade secrets or confidential or proprietary information to any person, firm,
corporation, association or other entity for any reason or purpose whatsoever,
or make use of any such property for his own purposes or for the benefit of
any
person, firm, corporation or other entity (except the Company) under any
circumstances unless compelled to do so by applicable law. The Director’s
obligation under this Section shall not apply to any information that is
generally available to the public, hereafter becomes available to the public
without the fault of the Director or is considered to be generic industry
practice. The Director agrees and acknowledges that all of such information,
in
any form, and copies and extracts thereof, are and shall remain the sole and
exclusive property of the Company and the Director shall return to the Company
the originals and all copies of any such information provided to or acquired
by
the Director in connection with the performance of his duties for the Company,
and shall return to the Company all files, correspondence and/or other
communications received, maintained and/or originated by the Director during
the
course of his relationship with the Company, and no copy of any such information
shall be retained by him.
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(c) It
is the
desire and intent of the Parties that the provisions of this Section shall
be
enforced to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. Accordingly, if
any
particular portion of this Section shall be adjudicated to be invalid or
unenforceable, this Section shall be deemed amended to delete therefrom the
portion thus adjudicated to be invalid or unenforceable, such deletion to apply
only with respect to the operation of this Section in the particular
jurisdiction in which such adjudication is made.
(d)
If
there
is a breach or threatened breach of the provisions of this Section, the Company
or its affiliates shall be entitled to an injunction restraining the Director
from such breach. Nothing herein shall be construed as prohibiting the Company
from pursuing any other remedies for such breach.
10. Return
of Property.
Not
later than the Resignation Date, the Director shall return all the Company’
property in the Director’s possession, including, but not limited to, the
Company’ keys, credit cards, computer software and peripherals and originals or
copies of books, records, or other information pertaining to the Company’s
businesses, including any Employer information regarding the Company on
Director’s personal computers.
11. Cooperation
in Legal and Other Matters.
After
the Resignation Date, the Director shall, at the request of the Company, assist
and cooperate with the Company in the defense and/or investigation of any third
party claim or any investigation or proceeding, whether actual or threatened,
including, without limitation, participating as a witness in any litigation,
arbitration, hearing or other proceeding between the Company and a third party
or any government body. The Company shall reimburse the Director for all
reasonable expenses incurred by him in connection with such assistance
including, without limitation, travel expenses.
12. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Colorado, without reference to the principles of conflict of
laws.
13. Taxes.
All
payments to be made hereunder shall be net of all applicable income and
employment taxes required to be withheld therefrom.
14. Complete
Agreement; Amendments.
This
Agreement represents the complete agreement between the Director and the Company
concerning the subject matter in this Agreement and supersedes all prior
agreements or understandings, written or oral, including without limitation
the
terms of any and all prior employment agreements. In executing this Agreement,
none of the Parties has relied or is relying on any representation with respect
to the subject matter of this Agreement or any representation inducing the
execution of this Agreement except those representations as are expressly set
forth in this Agreement, and the Parties acknowledge that each has relied on
their own judgment in entering into this Agreement. This Agreement may not
be
amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal
representatives.
15. Severability.
Each of
the sections contained in this Agreement shall be enforceable independently
of
every other section in this Agreement, and the invalidity or nonenforceability
of any section shall not invalidate or render unenforceable any other section
contained in this Agreement.
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16. Counterparts.
This
Agreement may be executed in counterparts, and each counterpart shall have
the
same force and effect as an original and shall constitute an effective, binding
agreement on the part of each of the undersigned.
17. Arbitration.
Before
beginning the binding arbitration mechanism set forth in this Section 17, the
Parties shall first participate in mediation of any dispute arising under this
Agreement. The mediator shall be chosen by the Parties, or, if the parties
cannot agree, by the American Arbitration Association. At least ten (10) days
before the mediation, each side shall provide the mediator with a statement
of
its position and copies of all supporting documents. Each party shall send
to
the mediation, a person who has authority to bind the party. Once the Parties
have participated in the mediation, and in the event the dispute between the
Parties has not been settled, either Party may invoke the binding arbitration
provisions in this Section 17.
Each
of
the Parties to this Agreement hereby voluntarily and knowingly waives any and
all rights to civil trial by jury as to any dispute or claim arising out of
or
relating to this Agreement, except when temporary or preliminary injunctive
relief is necessary as a result of a breach or threatened breach of Section
9
above or other situation where injunctive relief is necessary in order to
prevent irreparable harm, either party may seek injunctive relief from a court
of competent jurisdiction in the county of Denver, in the State of Colorado
and
the parties consent to personal jurisdiction in such court. Each of the Parties
further agrees that any such dispute or claim will be exclusively and finally
settled by binding arbitration in accordance with the rules of the American
Arbitration Association by one arbitrator appointed in accordance with said
rules. The exclusive venue for any such arbitration shall be the county of
Denver, in the State of Colorado. The arbitrator shall apply Colorado law,
without reference to rules of conflicts of law or rules of statutory
arbitration, to the resolution of any dispute. Judgment on any award rendered
by
the arbitrator may be entered in any court having jurisdiction
thereof.
The
decision of the arbitrator shall be binding upon the Parties. The Company shall
bear the fees of the arbitrator and the fee of the American Arbitration
Association. Other costs and attorneys’ fees will be borne by the party that
incurs them. The arbitrator shall award the prevailing party reasonable attorney
fees and costs in such proportion as the arbitrator decides. Notwithstanding
anything to the contrary, either party may no more than 90 nor less than 30
days
before the arbitration, serve a discovery request seeking any document that
would be discoverable in civil litigation. Responses to such requests shall
be
due 20 days after service. Thereafter, each party shall be allowed to take
three
(3) depositions of no more than four (4) hours each. The arbitrator may resolve
any discovery disputes as they would be resolved in civil
litigation.
18. Notices.
All
notices, requests, claims, demands or other communications hereunder shall
be in
writing and shall be deemed given when delivered personally, upon receipt of
a
transmission confirmation if sent by telecopy or like transmission and on the
next business day when sent by a reputable overnight carrier service to the
Parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
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If
to the
Company:
Matrix
Bancorp, Inc.
▇▇▇
▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Corporate Secretary
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
With
a
copy to:
▇▇▇▇▇▇
▇▇▇▇▇ LLP
▇▇▇▇
▇
▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇
▇.
▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇
▇. ▇▇▇▇, Esq.
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
If
to the
Director:
▇▇▇▇▇
▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
19. Press
Releases.
The
Parties shall consult with each other before issuing any press release with
respect to the subject matter of this Agreement and shall not issue any such
press release or make any such public statements without the prior consent
of
the other Parties, which shall not be unreasonably withheld; provided, however,
that the Company may, without the prior consent of the Director (but after
consultation, to the extent practicable under the circumstances), issue such
press release or make such public statements as may be required by law or the
rules and regulations of the Nasdaq Stock Market.
20. Voluntary
Execution of Agreement.
This
Agreement is executed voluntarily and without any duress or undue influence
on
the part or on behalf of the parties hereto, with the full intent of releasing
all claims. Each party acknowledges that (i) they have been advised by the
other
to consult an attorney regarding any potential claims as well as the terms
and
conditions of this Agreement before executing it, (ii) they have read the
Agreement and they fully understand the terms of this Agreement including,
without limitation, the significance and consequences of the general release
in
Section 5 hereof, (iii) they are executing this Agreement in exchange for
consideration in addition to anything of value to which they are entitled,
and
(iv) they are fully satisfied with the terms of this Agreement and are executing
this Agreement voluntarily, knowingly and willingly and without
duress.
[Signature
Page Follows]
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The
parties to this Agreement have executed this Agreement as of the day and first
written above.
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MATRIX
BANCORP, INC.
By: /s/
T. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
Name:
T. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title:
Senior Vice President
▇▇▇▇▇
▇▇▇▇▇
/s/
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▇▇▇▇▇
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