Exhibit 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into
as of the 1st day of January, 1999, by and between CompuCredit Corporation, a
Georgia corporation ("CompuCredit"), and ______________, an individual resident
of the State of Georgia ("Employee").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to enter into a written agreement
for the continued employment of Employee by CompuCredit on the terms and
conditions hereinafter stated which shall supersede any and all written or oral
arrangements between the parties concerning the subject matter hereof;
NOW, THEREFORE, for and in consideration of the Employee's continued
employment with the Company and the premises and the mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, CompuCredit and
Employee agree as follows:
1. RELATIONSHIP ESTABLISHED. Upon the terms and subject to the
conditions of this Agreement, CompuCredit hereby employs Employee to provide
efforts (the "Services") to CompuCredit as delegated to him from time to time by
the Chief Executive Officer, or his designee consistent with those generally
associated with an executive officer. Employee hereby agrees to devote
substantially all of his business efforts toward performing the Services, which
efforts shall constitute not less than a minimum average of forty (40) hours per
week for CompuCredit or one of it subsidiaries. In his performance of the
Services, Employee shall comply with applicable CompuCredit policies and
procedures.
2. TERM; TERMINATION.
2.1 TERM OF EMPLOYMENT. The term of Employee's employment under this
Agreement shall commence on January 1, 1999 and shall continue for an initial
term (the "Initial Term") of one (1) year, unless sooner terminated in
accordance with Section 2.2. Upon expiration of the Initial Term, Employee's
employment hereunder shall be continued (upon the same terms, subject to the
same conditions and at the same salary or at a salary agreed to by both
CompuCredit and Employee) after such expiration indefinitely on an at will
basis, subject to termination at any time by either party on not less than
thirty (30) days prior written notice by either party, or as otherwise provided
pursuant to Section 2.2 of this Agreement. The Initial Term and any additional
period of time employee is employed by CompuCredit thereafter shall be
collectively referred to as the "Term."
2.2 TERMINATION OF EMPLOYMENT.
(a) This Agreement shall automatically and immediately
terminate upon the death of Employee; or
(b) Either party may terminate this Agreement upon the
Complete Disability of Employee. "Complete Disability", as used herein, shall
mean the inability of Employee by reason of any physical or mental impairment to
perform fully and effectively, as determined in the reasonable judgment of a
competent physician selected in good faith by CompuCredit, the Services on a
full time basis for an aggregate of 90 days in any period of 180 consecutive
days.
(c) TERMINATION BY COMPUCREDIT. In addition to any other
rights or remedies available to CompuCredit, CompuCredit may, in its sole
discretion, terminate Employee's employment for Cause effective immediately upon
delivery of written notice to Employee. In this Agreement, "Cause" means the
reasonable, good faith determination of a majority of the Board of Directors of
CompuCredit that:
(i) (A) Employee has committed an act constituting
fraud, deceit or intentional material misrepresentation with
respect to CompuCredit or any client, customer or supplier of
CompuCredit; (B) Employee has embezzled funds or assets from
CompuCredit or any client or customer of CompuCredit; or (C)
Employee has engaged in willful misconduct or gross negligence
in the performance of the Services;
(ii) Employee has breached or defaulted in the
performance of any material provision of this Agreement and
has not cured such breach or default to CompuCredit's
reasonable satisfaction within thirty (30) days after
receiving notice thereof (provided that any breach by Employee
of any obligation under Section 9 will be grounds for
immediate termination for "Cause" without any notice or right
to cure); or
(iii) Employee's conduct is materially detrimental to
the reputation of CompuCredit which Employee has not cured (if
such conduct is curable in Employer's reasonable opinion) to
CompuCredit's reasonable satisfaction within ten (10) days
after receiving notice thereof.
(d) The date on which Employee's employment expires or
terminates for any reason is referred to herein as the "Termination Date."
(e) Employee may terminate the Term following a Change of
Control (as defined below), by providing CompuCredit at least thirty (30) days
prior written notice of termination. For purposes of this Agreement, "Change of
Control" shall mean the acquisition by any single person or entity or related
persons or entities of either substantially all the assets of the CompuCredit or
more than fifty percent (50%) of the outstanding and issued common stock of
CompuCredit following an initial public offering of CompuCredit's common stock.
3. COMPENSATION.
(a) During the Term, CompuCredit shall pay Employee as
compensation for the Services an annual salary as set forth on EXHIBIT A hereto
and incorporated herein by reference. Such compensation shall be payable in
substantially equal semi-monthly installments or in such other installments or
at such other intervals as may be the policy of CompuCredit from time to time,
and shall be subject to such deductions and withholdings as are required by law
or policies of CompuCredit in effect from time to time. Employee's salary per
annum may from time to time be adjusted as agreed in writing by both CompuCredit
and Employee.
(b) Notwithstanding anything to the contrary herein, if this
Agreement is terminated for any of the reasons set forth in Section 2 hereof,
CompuCredit shall be released of its obligation to pay further compensation or
benefits to Employee as set forth in this Agreement (except for salary already
earned under Section 3(a) hereof) and Employee will not be entitled to any
severance or other benefits upon any termination of his employment hereunder.
(c) If, during the Initial Term, CompuCredit defaults
hereunder by terminating Employee's employment (other than pursuant to Section 2
hereof), Employee shall be entitled to compensation paid in accordance with this
Section 3 for the remainder of the Initial Term.
4. VACATION. Employee shall be entitled to such number of weeks of paid
vacation in each calendar year of the Term as is provided in, and in accordance
with, CompuCredit's policies in effect from time to time for management
employees.
5. BENEFITS. Employee shall be entitled to participate in executive
employee benefit plans generally provided by CompuCredit to its executives, but
only if and to the extent provided from time to time in such executive benefits
plans and for so long as CompuCredit provides or offers such benefit plans.
6. REIMBURSEMENT FOR EXPENSES. CompuCredit shall reimburse Employee for
reasonable out-of-pocket expenses incurred by Employee in connection with the
performance of the Services hereunder for travel, entertainment and other
miscellaneous expenses to the extent such expenses are consistent with
CompuCredit's reimbursement policy as the same shall be in effect from time to
time. Reimbursement shall be made only against an itemized list of such expenses
submitted to CompuCredit by Employee within thirty (30) days after being
incurred, and, to the extent requested by CompuCredit, receipts and invoices
evidencing such expenses.
7. CONFIDENTIALITY.
(a) PROPRIETARY INFORMATION. Employee acknowledges that as an
employee of CompuCredit, he may from time to time have access to and be provided
with trade secrets (as defined under applicable law), and other confidential,
secret and proprietary information including without limitation, financial
statements or information, technical or nontechnical data, formulae,
compilations, programs, methods, data, financial plans, models, product plans,
marketing or sales strategies, portfolio information, or lists of actual or
potential borrowers, loan
program participants or other customers not generally available to the public
concerning any aspect of the products, services or businesses of CompuCredit,
its affiliates, or its and their officers, directors, employees, advisers,
agents or other personnel (collectively, "Proprietary Information"). Employee
agrees that he will not, directly or indirectly, disclose, publish, disseminate
or use any confidential information except as authorized herein. Employee may
use confidential information to perform the Services but in doing so will only
allow dissemination of confidential information to any individual, corporation,
partnership, limited liability company, joint venture, association, joint stock
company, government agency, trust, trustee, entity, unincorporated organization
or any other entity on a strict need-to-know basis (provided such persons are
first informed of the confidential nature of such information and directed to
use or disclose it only as permitted herein). If disclosure of any Confidential
Information is required by law, a court or agency of the government, then you
may make such disclosure after providing CompuCredit with reasonable notice, to
the extent that providing such notice to CompuCredit is legally permissible, so
that CompuCredit may seek protective relief.
(b) Notwithstanding the provisions of Section 7(a) above, the
following shall not be considered to be Proprietary information: (i) any
information that was in the public domain through no fault or act of Employee
prior to the disclosure thereof to Employee; (ii) any information that comes
into the public domain through no fault or act of Employee; (iii) any
information that is disclosed without restriction to Employee by a third party
(which term shall not include any equity holder, affiliate, or counsel,
accountants and other non-employee representatives of affiliated entitles, or of
any of their respective equity holders, affiliates or related Persons) having
the legal right to make such disclosure, and (iv) any confidential business
information that is not a trade secret on the three (3) year anniversary of the
Termination Date; PROVIDED, HOWEVER, that the limited duration of the
confidentiality obligation with regard to Proprietary Information not
constituting a trade secret shall not operate or be construed as affording
Employee any right or license thereafter to use Proprietary Information, or as a
waiver by CompuCredit of the rights and benefits otherwise available to
CompuCredit under the laws governing the protection and enforceability of
patents, trade secret and other intellectual property.
(c) RETURN OF MATERIALS. On or before the Termination Date, or
when otherwise requested by CompuCredit, Employee will deliver promptly to
CompuCredit all Proprietary Information and all other files, customer lists,
management reports, drawings, memoranda, forms, financial data and reports and
other materials or documents and equipment provided to, or obtained or created
by Employee in connection with the Services (including all copies of the
foregoing, and including all notes, records and other materials of or relating
to CompuCredit or their respective customers) in his possession or control and
shall destroy all other Proprietary Information in his possession.
8. TRANSFER AND ASSIGNMENT TO COMPUCREDIT.
(a) To the greatest extent possible, any Work Product will be
"work made for hire" (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 eT
Seq., as amended) and owned exclusively by CompuCredit. In this Agreement, "Work
Product" means work product, property, data, documentation, "know-how,"
concepts, plans, inventions, improvements, techniques,
processes or information of any kind, prepared, conceived, discovered, developed
or created by Employee in connection with the performance of the Services.
Employee hereby unconditionally and irrevocably transfers and assigns to
CompuCredit all right, title and interest Employee has or will have, by
operation of law or otherwise, in or to any Work Product, including, without
limitation, all patents, copyrights, trademarks, service marks, trade secrets
and other intellectual property rights. Employee agrees to execute and deliver
to CompuCredit any transfers or other instruments which CompuCredit may deem
necessary or appropriate to vest complete title and ownership of any Work
Product, and all rights therein, exclusively in CompuCredit.
(b) POWER OF ATTORNEY. Employee hereby irrevocably constitutes
and appoints CompuCredit as his agent and attorney-in-fact, with full power of
substitution, in the name, place and stead of Employee, to execute and deliver
any and all assignments or other instruments described in Section 8(a) above
that Employee fails or refuses promptly to execute and deliver. The foregoing
power and agency are coupled with an interest and are irrevocable.
9. COVENANT AGAINST COMPETITION.
(a) Employee acknowledges that the Proprietary Information
that he has acquired and will acquire, prior to and during the Term, includes
and will include information that could be used by Employee on behalf of a
Competitor (as hereinafter defined), its affiliates or others to the substantial
detriment of CompuCredit. Moreover, the parties recognize that Employee during
the course of his employment with CompuCredit will develop important
relationships with customers and others having valuable business relationships
with CompuCredit. In view of the foregoing, Employee acknowledges and agrees
that the restrictive covenants contained in this Agreement are reasonably
necessary to protect CompuCredit's legitimate business interests and goodwill.
If Employee is terminated without cause, he will only be bound by the covenant
against competition if he is paid at his then current salary for the one (1)
year period of time from and after the Termination Date.
(b) DEFINITIONS.
(i) "COMPETITIVE POSITION"- (A) the direct or
indirect equity ownership (excluding ownership of less than 2%
of the equity of an entity listed on a major U.S. exchange or
traded on a NASDAQ over-the-counter market) or control of all
or any portion of a "Competitor" (as hereinafter defined), or
(B) any employment, consulting, partnership, advisory,
directorship, agency, promotional or independent contractor
arrangement between Employee and any Competitor whereby
Employee is required to perform services substantially similar
to the Services
(ii) "COMPETITOR"- Any person or entity who provides
services substantially similar to Company Services.
(iii) "CUSTOMERS"- All Persons within the Territory
during the one-year period prior to the Termination Date (A)
to whom Employee offered or sold any
of the CompuCredit's products or services (including, without
limitation, any opportunity to participate in any loan program
established by CompuCredit), (B) to whom were offered or sold
any of CompuCredit's products or services or about whom
Employee had Proprietary Information, (C) who were approached
by CompuCredit with regard to a product, or (D) who were
identified as potential customers by CompuCredit's models or
processes.
(iv) "COMPANY SERVICES"- (A) purchasing, holding, and
selling credit card and home equity loans (purchased, held or
sold by CompuCredit), or portfolios thereof, or both, (B)
servicing services, and (C) engaging in the business of making
credit card and home equity loans to consumers.
(v) "TERRITORY"- The United States, which is the
territory within which customers and accounts of CompuCredit
will be located and where Employee will provide Services
during the term of his employment under this Agreement.
(c) COVENANTS OF EMPLOYEE. In consideration of Employee's
employment by CompuCredit and CompuCredit's providing to Employee the
consideration described in Section 3 above, and based on and subject to the
provisions set forth in Section 9(a) above, Employee agrees that, during the
Term and for a period of one (1) year from and after the termination of
Employee's employment hereunder for any reason, Employee will not, without the
prior written consent of CompuCredit, directly or indirectly for or on behalf of
any Person other than CompuCredit, as principal, agent or otherwise:
(i) take any action in furtherance of a
Competitive Position; or
(ii) solicit Customers for the purpose of providing
services competitive with any of the Company Services; or
(iii) solicit or induce (or attempt to do so) to
leave employment with CompuCredit anyone who is or was, during
the last year of Employee's relationship with CompuCredit, an
employee of CompuCredit or an affiliated entity who would
provide similar services to a Competitor.
(d) Employee hereby represents and warrants to CompuCredit
that he is not now a party to any agreement, court order, decree or other
restriction which restricts him from using or disclosing to any party any
information deemed to be proprietary or confidential or deemed to be a trade
secret, of which in any way restricts Employee from engaging in or rendering any
of the Services.
10. INTERPRETATION; SEVERABILITY. All rights and restrictions contained
in this Agreement may be exercised and shall be applicable and binding only to
the extent that they do not violate any applicable laws and are intended to be
limited to the extent necessary so that they will not render this Agreement
illegal, invalid or unenforceable.
It is understood and agreed that the provisions hereof are severable; if such
provisions shall be deemed invalid or unenforceable as to any period of time,
territory, or business activity, such provisions shall be deemed limited to the
extent necessary to render it valid and enforceable, and the unenforceability of
any provisions hereof shall not in any event cause any other provision hereof to
be unenforceable. No provision of this Agreement shall be construed against or
interpreted to the disadvantage of any party hereto by any court or other
governmental or judicial authority by reason of such party having or being
deemed to have structured or dictated such provision.
11. RELIEF. In the event of any threatened or actual breach of the
provisions of this Agreement by either party, the other party shall be entitled
to injunctive relief in addition to any other remedies it may have at law or in
equity.
12. NONWAIVER. Failure of either party to insist, in one or more
instances, on performance by the other in strict accordance with the terms and
conditions of this Agreement shall not be deemed a waiver or relinquishment of
any right granted hereunder or of the future performance of any such term or
condition or of any other term or condition of this Agreement, unless such
waiver is contained in a writing signed by or on behalf of both parties.
13. NOTICES. Any notice or other communication required or permitted
hereunder shall be deemed sufficiently given if delivered by hand or sent by
registered or certified mail, return receipt requested, postage and fees
prepaid, addressed to the party to be notified as follows:
(a) If to CompuCredit: CompuCredit Corporation
Xxx Xxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxx
(b) If to Employee: [Employee's Name]
[Employee's Address]
or in each case to such other address as either party may from time to time
designate in writing to the other. Such notice or communication shall be deemed
to have been given as of the date so delivered or five (5) days after the date
so mailed.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Georgia.
15. ENTIRE AGREEMENT; AMENDMENT. This Agreement contains the sole and
entire agreement between the parties hereto with respect to CompuCredit's
employment of Employee and supersedes all prior discussions and agreements
between the parties relating to such employment and any such prior agreements
shall, from and after the date hereof, be null and void. Employee is a
sophisticated businessperson and has received such documents and other
information as he has deemed necessary to make his own independent judgment as
to the merits
of this Agreement and the remuneration that he will receive as a result hereof;
further, it is hereby agreed by Employee that neither CompuCredit nor any
affiliated entities have made any representation to Employee other than those
specifically set forth in this Agreement. This Agreement shall not be modified
or amended except by an instrument in writing signed by or on behalf of the
parties hereto.
16. PARTIES BENEFITED. This Agreement shall inure to the benefit of,
and be binding upon Employee, CompuCredit, and its respective heirs, legal
representatives, successors and assigns; provided that, as to Employee, this is
a personal service contract and Employee may not assign this Agreement or any
part hereof.
17. TAX CONSEQUENCES. CompuCredit shall have no obligation to Employee
with respect to any tax obligation Employee incurs as a result of or
attributable to this Agreement, including all supplemental agreements and
employee benefit plans, if any, in which Employee may hereafter participate, or
arising from any payments made or to be made hereunder or thereunder.
18. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall for all purposes be deemed an original, and all of such
counterparts shall together constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
CompuCredit Corporation
By:
-------------------------------------------
Xxxxx X. Xxxxx, President
By:
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Employee
SCHEDULE
This schedule sets forth the annual salary information for each officer
with whom the Company has entered into an Employment Agreement.
Xxxxx X. Xxxxx................................................................$50,000
Xxxxx X. Xxxxxx................................................................$50,000
Xxxxxxx Xxxxx.................................................................$200,000
Xxxxxxx X. Xxxxxxx............................................................$175,000
Xxxxxx X. Xxxxxxx.............................................................$50,000
