Exhibit No. 10.23
DEFERRED COMPENSATION AGREEMENT
THIS AGREEMENT, made as of the 30th day of December, 1996, by and
between Financial Federal Corporation (the "Company") and Xxxxxxxx X.
Xxxxxx, Xx.(the "Employee");
W I T N E S S E T H :
WHEREAS, Employee is an employee of the Company; and
WHEREAS, the Employee and the Company desire to set forth in writing
herein the terms and conditions of their agreement with respect to the
payment to Employee, on a deferred basis, of some of the Employee's
salary for his services to the Company for the months of January, 1997
through December, 1997.
NOW, THEREFORE, the parties hereto agree as follows:
1. Certain amounts of salary earned by the Employee for each of the
months of January 1997 through December 1997, shall be deferred and, in
lieu of current payment thereof, the Company shall pay to the Employee
the sum of $50,000.00 on each January 31 commencing in 1999 and
terminating in 2005, and $15,905.30 on January 31, 2006. The amounts so
deferred are shown on Exhibit 1 to this Agreement. In the event the
Employee's employment is terminated for any reason whatsoever during
this period, the amount payable to the Employee pursuant to this
paragraph shall be proportionately reduced (in the same proportion as
the number of days or portions thereof from the date of such termination
of employment to the end of this period bears to the entire period), and
any payment provided for in paragraphs "2", "3", "5" or "7" of this
Agreement shall be further discounted as described in paragraph "4" of
this Agreement.
2. In the event of i). Employee's death, ii). Employee's retirement
from the Company and its affiliates (and employment is not obtained with
another company in substantially the same types of business as the
Company is engaged) or iii). Employee's leave of absence owing to a bona
fide disability (which shall be defined as the incapacity to perform any
employment which would be appropriate given the prior physical status,
intellectual ability and experience of the Employee, due to a mental or
physical disability which shall have been certified by an independent
physician and which has lasted or can be expected to last for a
continuous period of not less than twelve months), then, in the
Company's sole discretion, either a). the Company shall pay the amount
specified in paragraph "1" on the date there specified or b). all
amounts payable pursuant to paragraph "1" of this Agreement shall be re-
computed as described in paragraph "4" of this Agreement and shall be
paid in total on the first day of the first month 30 days after the date
of the death, retirement or disability. Payments of amounts due
pursuant to the terms of this paragraph shall be made first to the
Employee, if living, then to the Employee's Beneficiary, Xxxx X. Xxxxxx,
the Employee's wife, or if she is not then alive, to the Employee's
Estate.
3. Except for the events specified in paragraph "2" of this Agreement,
in the event of termination of Employee's employment by the Company for
any other reason whatsoever (other than a transfer to employment with an
affiliate of the Company), or in the event the Employee terminates his
employment with the Company and its affiliates then, in either such
event, the amount payable pursuant to paragraph "1" of this Agreement
shall be paid to Employee on the first day of the first month following
such termination of employment in an amount calculated as set forth in
paragraph "4" of this Agreement.
4. If, pursuant to paragraphs "2", "3", "5" or "7" of this Agreement,
payment of any amount provided for in paragraph "1" of this Agreement is
to be made earlier than the due date set forth in such paragraph "1",
the amount to be paid is the amount as provided in paragraph "1" of this
Agreement, discounted at the rate of 6.13% per annum, compounded
monthly, from the date any such payments would have been due (as set
forth in paragraph "1" of the Agreement) to the actual date of payment.
For purposes of illustration, a payment of $500.00 would be due with
respect to a $638.54 payment which would have been due and payable
forty-eight (48) months later.
5. If any federal, state or other tax law or regulation or any
determination by any taxing authority with respect to the Employee would
cause any amounts due pursuant to this Agreement to become taxable to
the Employee before payment thereof, except for taxes owing due to FICA,
FUTA,or other employment taxes, then the Employee, irrespective and
notwithstanding any other provisions of this Agreement, shall have the
right, upon written notice to the Company, to require payment of any of
the installments or portions thereof specified in paragraph "1" of this
Agreement. The notice shall specify a date within ninety (90) days of
such notice when payment is to be made. The payment shall be made in an
amount calculated as set forth in paragraph "4" of this Agreement.
6. Employee shall have no right to pledge, hypothecate, assign or
otherwise dispose of any amounts due or to become due hereunder.
Employee's right to receive payments under this Agreement shall be no
greater than those of any other unsecured creditor of the Company.
7. Should, at any time, more than 50 percent of the combined voting
power of the Company's then outstanding voting securities be held by any
person, entity or group of persons, directly or indirectly, within the
meaning of section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended ("Act"), other than those persons, entities or groups
of persons owning over 14 percent of the combined voting power as of the
date hereof, or a liquidation or dissolution of the Company or of the
sale of all or substantially all of the Company's assets, then a). the
Company may, upon 30 days notice, pay to Employee the amount payable
pursuant to paragraph "1" of this Agreement on the first day of the
first month following such notice in an amount calculated as set forth
in paragraph "4" of this Agreement, OR b). Employee may, upon 30 days
notice, require that the Company pay to Employee the amount payable
pursuant to paragraph "1" of this Agreement on the first day of the
first month following such notice in an amount calculated as set forth
in paragraph "4" of this Agreement.
8. During the term of this Agreement, the Company shall furnish to
Employee, no later than the 30th day of each fiscal year, a schedule
setting forth in reasonable detail the changes occurring during the
preceding year and the balance as at the end of the preceding year with
respect to the amount accrued by the Company on account of all sums
payable hereunder to Employee.
9. Employee shall have the right at any time, by written notice to the
Company, to change the Beneficiary named in paragraph "2" hereof, with
such notice acknowledged in writing by the Company.
10. This Agreement contains the entire understanding of the parties
hereto relating to the payments described herein; however, this
Agreement shall not affect any other salary nor any other benefit that
Employee may be or may become entitled to, except as required by law.
This written agreement represents the entire final agreement between the
parties relating to the payments described herein and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral
agreements of the parties. There are no unwritten oral agreements
between the parties. This agreement cannot be amended, modified or
changed except by a writing signed by both parties. Only an officer of
the Company with the title of Senior Vice President or a more senior
officer may accept this agreement or agree to any amendments,
modifications or changes.
11. This Agreement shall be governed and construed in accordance with
the laws of the State of New York. If any provision of this Agreement
is rendered or declared invalid, illegal or ineffective by any existing
or subsequently enacted legislation or decision of a court of competent
jurisdiction, such legislation or decision shall only invalidate such
provision to the extent so rendered or declared invalid, illegal or
ineffective in such jurisdiction only and shall not impair, invalidate
or nullify the remainder of this Agreement which shall remain in full
force and effect.
12. Any controversy or claim arising out of or relating to this
Agreement or any alleged breach thereof shall be settled by arbitration
in New York City in accordance with the rules of the American
Arbitration Association governing contract disputes and judgment upon
the award rendered by any arbitrator(s) may be entered in any court of
appropriate jurisdiction; the Federal Arbitration Act and the applicable
laws of the State of New York shall govern.
IN WITNESS WHEREOF, Company has caused this Agreement to be executed by
its duly authorized officers and Employee has hereunto set his hand on
the day and year first above written.
FINANCIAL FEDERAL CORPORATION
BY:
(Title)
EMPLOYEE:
_____________________
EXHIBIT 1 to Deferred Compensation Agreement
For every payroll period beginning after December 31, 1996 until
December 31, 1997, $11,458.33 shall be deferred, per the Agreement
between Financial Federal Corporation and Xxxxxxxx X. Xxxxxx, Xx. (the
"Employee") dated December 30, 1996.
