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Exhibit 10.6
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of April 20, 2000, is made and entered into by and
between United Financial, Inc., a wholly owned subsidiary of Matrix Bancorp,
Inc. ("Employer"), and Carl G. de Rozario, an executive employee of Employer
("Executive").
Recitals
A. Employer desires that the Executive enter into an employment
relationship with Employer in order to provide the necessary leadership and
senior management skills that are important to the success of Employer.
Employer believes that obtaining the Executive's services as an employee of
Employer and the benefits of his global business experience are of material
importance to Employer and Employer's shareholders.
Agreement
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein the receipt and sufficiency of which is hereby acknowledged,
Employer and Executive intend by this Agreement to specify the terms and
conditions of Executive's employment relationship with Employer.
Section 1. General Duties of Employer and Executive.
1.1. Employer agrees to employ Executive and Executive agrees to accept
employment by Employer and to serve Employer in an executive capacity upon the
terms and conditions set forth herein. The duties and responsibilities of
Executive shall include those described for the particular position held by
Executive while employed hereunder in the Bylaws of Employer or other documents
of Employer, and shall also include such other or additional duties, for
Employer, as may from time to time be assigned to Executive in good faith by the
Board of Directors of Employer or any duly authorized committee thereof. The
initial executive capacity that Executive shall hold while this Agreement is in
effect shall be the position of Chief Executive Officer.
1.2. While employed hereunder, Executive shall obey the lawful directions
of the Board of Directors of Employer, or any duly authorized committee thereof,
and shall use his best efforts to promote the interests of Employer and to
maintain and to promote the reputation thereof. While employed hereunder,
Executive shall devote his time, efforts, skills and attention to the affairs of
Employer in order that he shall faithfully perform his duties and obligations
hereunder and such as may be assigned to or vested in him by the Board of
Directors of Employer, or any duly authorized committee thereof.
1.3. While this Agreement is in effect, Executive may from time to time
engage in any businesses or activities that do not compete directly and
materially with Employer, provided that such businesses or activities do not
materially interfere with his performance of the duties assigned to him in
compliance with this Agreement by the Board of Directors of Employer or any duly
authorized committee thereof. In any event, Executive is permitted to (i)
invest his personal assets as a passive investor in such form or manner as
Executive may choose in his discretion, (ii) participate in various charitable
efforts, and (iii) serve as a director or officer of any other entity or
organization that does not compete with Employer. Executive shall be
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permitted to participate in such other transactions and perform such other
duties as do not materially interfere with his performance hereunder.
Section 2. Compensation and Benefits.
2.1. As compensation for services to Employer, Employer shall pay to
Executive, while this Agreement is in effect, a salary at a yearly rate of
$250,000.00. Such salary may be adjusted upon a good faith determination of the
Board of Directors that such salary should be adjusted; provided that the Board
of Directors shall not adjust such salary downward prior to January 1, 2001.
The salary shall be payable in equal semi-monthly installments, subject only to
such payroll and withholding deductions as may be required by law and other
deductions applied generally to employees of Employer for insurance and other
employee benefit plans.
2.2. Upon Executive's furnishing to Employer customary and reasonable
documentary support (such as receipts or paid bills) evidencing costs and
expenses incurred by him in the performance of his services and duties hereunder
(including, without limitation, travel and entertainment expenses) and
containing sufficient information to establish the amount, date, place and
essential character of the expenditure, Executive shall be reimbursed for such
costs and expenses in accordance with Employer's normal expense reimbursement
policy.
2.3. Executive shall have the right to participate in any additional
compensation, bonus plan, benefit, life insurance or other plan or arrangement
of Employer now or hereafter existing for the benefit of executive officers of
Employer.
2.4. Executive shall be entitled to such vacation (in no event less than
three (3) weeks per year), holiday and other paid or unpaid leave of absence as
consistent with Employer's normal policies or as otherwise approved by the Board
of Directors. Executive shall participate in the Employer's incentive
compensation and deferred compensation plans as may be in effect from time to
time during the employment term.
Section 3. Preservation of Business; Fiduciary Responsibility.
3.1. Executive shall use his best efforts to preserve the business and
organization of Employer, to keep available to Employer the services of present
employees and to preserve the business relations of Employer. Executive shall
not commit any act, or in any way assist others to commit any act, that would
injure Employer. So long as the Executive is employed by Employer, Executive
shall observe and fulfill proper standards of fiduciary responsibility attendant
upon his service and office.
Section 4. Initial Term; Extensions of the Term.
4.1. The term of this Agreement shall commence on the effective date
hereof and shall end on April 30, 2003.
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Section 5. Termination other than by Expiration of the Term.
Employer or Executive may terminate Executive's employment under this
Agreement at any time, but only on the following terms:
5.1. Executive may terminate his employment under this Agreement at any
time upon at least sixty (60) days' prior written notice to Employer.
5.2. Employer may terminate Executive's employment under this Agreement at
any time, without prior notice, for "due cause" upon the good faith
determination by the Board of Directors of Employer that "due cause" exists for
the termination of the employment relationship. As used herein, the term "due
cause" shall mean any of the following events:
(i) any intentional misapplication by Executive of Employer's funds,
or any other act of dishonesty injurious to Employer committed by
Executive; or
(ii) Executive's conviction of a crime involving moral turpitude; or
(iii) Executive's breach, non-performance or non-observance of any
respect of any of the material terms of this Agreement if such breach, non-
performance or non-observance shall continue beyond a period of thirty (30)
business days immediately after notice thereof by Employer to Executive; or
(iv) any other action by the Executive involving willful and
deliberate malfeasance or gross negligence in the performance of
Executive's duties.
5.3. In the event Executive is incapacitated by accident, sickness or
otherwise so as to render Executive mentally or physically incapable of
performing the services required under Section 1 of this Agreement for a period
of one hundred eighty (180) consecutive business days, and such incapacity is
confirmed by the written opinion of two (2) practicing medical doctors licensed
by and in good standing in the state in which they maintain offices for the
practice of medicine, upon the expiration of such period or at any time
reasonably thereafter, or in the event of Executive's death, Employer may
terminate Executive's employment under this Agreement upon giving Executive or
his legal representative written notice at least thirty (30) days prior to the
termination date. Executive agrees, after written notice by the Board of
Directors of Employer or a duly authorized committee or officer of Employer, to
submit to examinations by such practicing medical doctors selected by the Board
of Directors of Employer or a duly authorized committee or officer of Employer.
5.4. Employer may terminate Executive's employment under this Agreement at
any time for any reason whatsoever, even without "due cause," by giving a
written notice of termination to Executive, in which case the employment
relationship shall terminate immediately upon the giving of such notice.
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Section 6. Effect of Termination.
6.1. In the event the employment relationship is terminated (a) by
Executive upon sixty (60) days' written notice pursuant to Subsection 5.1
hereof, (b) by Employer for "due cause" pursuant to Subsection 5.2 hereof, or
(c) by Executive breaching this Agreement by refusing to continue his employment
and failing to give the requisite sixty (60) days' written notice, all
compensation and benefits shall cease as of the date of termination, other than:
(i) those benefits that are provided by retirement and benefit plans and
programs specifically adopted and approved by Employer for Executive that are
earned and vested by the date of termination, and (ii) Executive's pro rata
annual salary through the date of termination.
6.2. If Executive's employment relationship is terminated pursuant to
Subsection 5.3 hereof due to Executive's incapacity or death, Executive (or, in
the event of Executive's death, Executive's legal representative) will be
entitled to those benefits that are provided by retirement and benefits plans
and programs specifically adopted and approved by Employer for Executive that
are earned and vested at the date of termination and, even though no longer
employed by Employer, shall continue to receive the salary compensation (payable
at the then current rate at the time of incapacity or death and in the manner as
prescribed in the second sentence of Subsection 2.1) for one (1) year following
the date of termination.
6.3. If Employer (i) terminates the employment of Executive other than
pursuant to Subsection 5.2 hereof for "due cause" or other than for a disability
or death pursuant to Subsection 5.3 hereof, (ii) demotes the Executive to a
position below a position as Chief Executive Officer of Employer, or (iii)
decreases Executive's salary below the level set forth in Subsection 2.1 or
reduces the employee benefits and perquisites below the level provided for by
the terms of Section 2 hereof, other than as a result of any amendment or
termination of any employee and/or executive benefit plan or arrangement, which
amendment or termination is applicable to all qualifying executives of Employer,
then such action by Employer, unless consented to in writing by Executive, shall
be deemed to be a constructive termination by Employer of Executive's employment
(a "Constructive Termination"). In the event of a Constructive Termination, the
Executive shall be entitled to receive, in a lump sum within thirty (30) days
after the date of the Constructive Termination, an amount equal to (A)
Executive's "salary" (as defined in Section 6.1 together with all other cash
bonuses) multiplied by (B) 1095 minus the number of days that have elapsed
between April 20, 2000 and the date of such termination divided by (C) 365.
6.4. For purposes of this Section 6, the term "salary" shall mean the sum
of (i) the annual rate of compensation provided to Executive by Employer under
Subsection 2.1 immediately prior to the Constructive Termination plus (ii) the
annual average cash bonuses and other cash incentive compensation paid to the
Executive during the term of the Agreement.
6.5. In the event of a Constructive Termination, all other rights and
benefits Executive may have under the employee and/or executive benefit plans
and arrangements of Employer generally shall be determined in accordance with
the terms and conditions of such plans and arrangements.
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Section 7. Covenant of Nonsolicitation.
7.1 Because Executive has developed and/or may develop considerable
personal contacts with the clients served by Employer, Executive agrees that,
while Executive is employed with Employer and for a period of twelve (12)
months after the date of termination of this Agreement (the "Restricted
Period"), he will not, either directly or indirectly, solicit individuals or
other entities that are customers of Employer during the six-month period
immediately prior to the date of termination of this Agreement. Executive also
agrees that, for the Restricted Period, he will not, either directly or
indirectly, solicit any employee or other independent contractor of the Employer
to terminate his or her employment or contract with the Employer.
Section 8. Change in Control.
8.1. Notwithstanding anything to the contrary in this Agreement, if a
"Change in Control" (as defined below) of the Employer occurs and, within twelve
(12) months from the date of the Change in Control, the Executive voluntarily
terminates his employment under Subsection 5.1, then the Executive, even though
no longer employed by the Employer, shall be entitled to receive, in a lump sum
within thirty (30) days after the date of such termination, an amount equal to
(A) Executive's "salary" (as defined in Section 6.1 together with all other cash
bonuses) multiplied by (B) 1095 minus the number of days that have elapsed
between April 20, 2000 and the date of such termination.
8.2. For the purposes of this Agreement, the term "Change in Control" of
the Employer shall be deemed to have occurred if (i) after April 20, 2000, any
"person" (as such term is used in Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended) other than any Employer employee stock
ownership plan or the Employer, becomes the beneficial owner (as such term is
used in Section 13(d) of the Securities Exchange Act of 1934, as amended),
directly or indirectly, of securities of the Employer representing 25% or more
of the combined voting power of the Employer's then outstanding securities, (ii)
the Board ceases to consist of a majority of Continuing Directors (as defined
below) or (iii) a person (as defined in clause (i) above) acquires (or, during
the 12-month period ending on the date for the most recent acquisition by such
person or group of persons, has acquired) gross assets of Employer that have an
aggregate market value greater than or equal to over 50% of the fair market
value of all of the gross assets of Executive immediately prior to such
acquisition or acquisitions.
8.3. For purposes of this Agreement, a "Continuing Director" shall mean a
member of the Board of Directors who either (i) is a member of the Board of
Directors at the date of this Agreement or (ii) is nominated or appointed to
serve as a director by a majority of the then Continuing Directors.
8.4. Notwithstanding any other provision of this Agreement, if (a) there
is a change in the ownership or effective control of the Employer or (b) in the
ownership of a substantial portion of the assets of the Employer within the
meaning of Section 280G of the Internal Revenue Code ("Section 280G"), the
payments to be paid to the Executive in the nature of compensation to be
received by or for the benefit of the Executive and contingent upon such
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event (the "Termination Payments") would create an "excess parachute payment"
within the meaning of Section 280G, then the Employer shall make the Termination
Payments in substantially equal installments, the first installment being due
within thirty days after the date of termination and each subsequent installment
being due on January 31 of each year, such that the aggregate present value of
all Termination Payments, whether pursuant to this Agreement or otherwise, will
be as close as possible to, but not exceed 299% of, the Executive's base salary,
within the meaning of Section 280G. It is the intention of this Subsection 8.3
to avoid excise taxes on the Executive under Section 4999 of the Code and the
disallowance of a deduction to the Employer pursuant to Section 280G.
Section 9. Inventions.
9.1. Any and all inventions, product, discoveries, improvements,
processes, formulae, manufacturing methods or techniques, designs or styles
(collectively, "Inventions") made, developed or created by Executive, alone or
in conjunction with others, during regular hours of work or otherwise, during
the term of Executive's employment with the Employer may be directly or
indirectly related to the business of, or tests being carried out by, the
Employer, or any of its subsidiaries, shall be promptly disclosed by Executive
to Employer and shall be the Employer's exclusive property.
9.2. Executive will, upon the Employer's request and without additional
compensation, execute any documents necessary or advisable in the opinion of the
Employer's counsel to direct the issuance of patents to the Employer with
respect to Inventions that are to be the Employer's exclusive property under
this Section 9 or to vest in the Employer title to such Inventions; the expense
of securing any patent, however, shall be borne by the Employer.
9.3. Executive will hold for the Employer's sole benefit any Invention
that is to be the Employer's exclusive property under this Section 9 for which
no patent is issued.
9.4. Executive grants to Employer a royalty-free, nonexclusive irrevocable
license for any Inventions developed prior to the employment with the Company
that he has not reserved that are used by Executive in the performance of his
duties for the Employer. Employee represents and warrants that any work
produced by Executive will not, to the best knowledge of Executive, infringe on
any other person's or entity's copyright or other proprietary rights, and
Employee will hold the Employer harmless from any claims and losses based on
such infringements.
Section 10. No Violation.
10.1. Executive represents that he is not bound by any agreement with any
former employer or other party that would be violated by Executive's work for
Employer.
Section 11. Confidential and Proprietary Information.
11.1. Executive acknowledges and agrees that he will not, without the
prior written consent of the Employer, at any time during the term of this
Agreement or any time thereafter, except as may be required by law, regulatory
process or competent legal authority or as required
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by the Employer to be disclosed in the course of performing Executive's duties
under this Agreement for the Employer, use or disclose to any person, firm or
other legal entity, any confidential records, secrets or information related to
the Employer or any parent, subsidiary or affiliated person or entity
(collectively, "Confidential Information"). Executive acknowledges and agrees
that all Confidential Information of Employer and/or its affiliates that he has
acquired, or may acquire, were received, or will be received in confidence and
as a fiduciary of the Employer. Executive will exercise utmost diligence to
protect and guard such Confidential Information.
11.2. Executive agrees that he will not take with him upon the termination
of this Agreement, any document or paper, or any photocopy or reproduction or
duplication thereof, relating to any Confidential Information.
Section 12. Return of Employer's Property.
12.1. Upon the termination of this Agreement or whenever requested by
Employer, Executive shall immediately deliver to Employer all property in his
possession or under his control belonging to Employer, in good condition,
ordinary wear and tear excepted.
Section 13. Injunctive Relief.
13.1. Executive acknowledges that the breach, or threatened breach, by the
Executive of the provisions of this Agreement shall cause irreparable harm to
the Employer, which harm cannot be fully redressed by the payment of damages to
the Employer. Accordingly, the Employer shall be entitled, in addition to any
other right or remedy it may have at law or in equity, to an injunction
enjoining or restraining Executive from any violation or threatened violation of
this Agreement.
Section 14. Arbitration.
14.1. As concluded by the parties and as evidenced by the signatures of
the parties, any dispute between the parties arising out of any section of this
Agreement will, on the written notice of one party served on the other, be
submitted to arbitration complying with and governed by the provisions of the
American Arbitration Association, provided such arbitration shall be held in
Denver, Colorado.
14.2. Each of the parties will appoint one person as an arbitrator to hear
and determine the dispute and if they are unable to agree, then the two
arbitrators so chosen will select a third impartial arbitrator whose decision
will be final and conclusive upon the parties.
14.3. The expenses of such arbitration will be borne by the losing party
or in such proportion as the arbitrators decide.
14.4. A material or anticipatory breach of any section of this Agreement
shall not release either party from the obligations of this Section 14.
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Section 15. Miscellaneous.
15.1. If any provision contained in this Agreement is for any reason held
to be totally invalid or unenforceable, such provision will be fully severable,
and in lieu of such invalid or unenforceable provision there will be added
automatically as part of this Agreement a provision as similar in terms as may
be valid and enforceable.
15.2. All notices and other communications required or permitted hereunder
or necessary or convenient in connection herewith shall be in writing and shall
be deemed to have been given when mailed by registered mail or certified mail,
return receipt requested, as follows (provided that notice of change of address
shall be deemed given only when received):
if to Employer:
United Financial, Inc.
c/o Matrix Bancorp, Inc.
1380 Lawrence Street, Suite 1400
Denver, Colorado 80204
FAX: (303) 390-0952
Attn: General Counsel
if to Executive:
Carl G. de Rozario
2658 S. Newcomb Street
Lakewood, Colorado 80227
or to such other names or addresses as Employer or Executive, as the case may
be, shall designate by notice to the other party hereto in the manner specified
in this Subsection 15.2.
15.3. This Agreement shall be binding upon and inure to the benefit of
Employer, its successors, legal representatives and assigns, and upon Executive,
his heirs, executors, administrators, representatives, legatees and assigns.
Executive agrees that his rights and obligations hereunder are personal to him
and may not be assigned without the express written consent of Employer.
15.4. This Agreement replaces and merges all previous agreements and
discussions relating to the same or similar subject matters between Executive
and Employer with respect to the subject matter of this Agreement. This
Agreement may not be modified in any respect by any verbal statement,
representation or agreement made by any employee, officer, or representative of
Employer or by any written agreement unless signed by an officer of Employer who
is expressly authorized by Employer to execute such document.
15.5. The laws of the State of Colorado will govern the interpretation,
validity and effect of this Agreement without regard to the place of execution
or the place for performance thereof, and Employer and Executive agree that the
state and federal courts situated in Denver County, Colorado shall have personal
jurisdiction over Employer and Executive to hear all disputes
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arising under this Agreement. This Agreement is to be at least partially
performed in Denver County, Colorado, and, as such, Employer and Executive agree
that venue shall be proper with the state or federal courts in Denver County,
Colorado to hear such disputes.
15.6. Executive and Employer shall execute and deliver any and all
additional instruments and agreements that may be necessary or proper to carry
out the purposes of this Agreement.
15.7. The descriptive headings of the several sections of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.
15.8. If either party should file a lawsuit against the other to enforce
any right such party has hereunder, the prevailing party shall also be entitled
to recover reasonable attorneys' fees and costs of suit in addition to any other
relief awarded such prevailing party.
15.9. This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same agreement.
15.10. Executive acknowledges that Executive has had the opportunity to
read this Agreement and discuss it with advisors and legal counsel, if Executive
has so chosen. Executive also acknowledges the importance of this Agreement and
that Employer is relying on this Agreement in entering into an employment
relationship with Executive.
15.11. Notwithstanding anything else herein to the contrary, this Agreement
shall not supercede or govern the terms of any stock options granted to
Executive.
15.12. The provisions of Sections 6, 7, 9, 11, 12, 13, and 14 shall
survive a termination of this Agreement.
The undersigned, intending to be legally bound, have executed this
Agreement on the date first written above.
EMPLOYER:
UNITED FINANCIAL, INC.
By: /s/ D. Mark Spencer
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Name: D. Mark Spencer
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Title: Director
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EXECUTIVE:
/s/ Carl G. de Rozario
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Carl G. de Rozario
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