Employment Agreement - American Home Mortgage Corp. and Ronald Rosenblatt
EMPLOYMENT AGREEMENT
This Employment Agreement, dated as of September 1st, 2003 (this "Agreement"),
is by and between American Home Mortgage Corporation, a New York corporation
having a place of business at 520 Broadhollow Road, Melville, NY 11747 (the
"Company"), and Ronald Rosenblatt, Ph.D., currently residing at [address
omitted] (the "Executive").
Whereas the Company wishes to assure itself of the services of the
Executive, and the Executive desires to be employed by the Company, upon the
terms and conditions hereinafter set forth.
Now, Therefore, the Company and the Executive hereby agree as
follows:
1. Employment. The Company agrees to employ the Executive, and the
Executive hereby accepts such employment by the Company during the term set
forth in Section 2 and on the other terms and conditions of this Agreement.
2. Term. The term of this Agreement shall commence on September 1,
2003, and shall continue until December 31, 2005 or until four weeks after the
resignation or discharge of the Executive.
3. Position, Duties and Responsibilities, Rights.
(a) During the term of this Agreement, the Executive shall serve as,
and be elected to and hold the office and title of Senior Executive Vice
President, Sales Support & Development. Until at least January 2004, Executive
will serve as Executive Vice President for the Enterprise Division. The
Executive shall report to the CEO of the Company throughout the term of this
Agreement. As such, the Executive shall have all of the powers and duties
usually incident to such office.
(b) During the term of this Agreement, the Executive agrees to
devote substantially all the Executive's time, efforts and skills to the affairs
of the Company during the Company's normal business hours, except for vacations,
illness and incapacity, but nothing in this Agreement shall preclude the
Executive from devoting reasonable periods to (i) manage the Executive's
personal investments, (ii) participate in professional, educational, public
interest, charitable, civic or community activities, including activities
sponsored by trade organizations, (iii) serve as a director or member of an
advisory committee of any corporation not in competition with the Company or any
of its subsidiaries, or as an officer, trustee or director of any charitable,
educational, philanthropic, civic, social or industry organizations, or as a
speaker or arbitrator; provided, however, that the performance of the
Executive's duties or responsibilities in any of such capacities does not
materially interfere with the regular performance of the Executive's duties and
responsibilities hereunder.
(c) Place of Performance. In connection with the Executive's
employment by the Company for the period through July 31, 2004, the Executive
shall be primarily based both in an office to be established in Melville, New
York, as well as an office in Des Moines, Iowa. After
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July 31, 2004, the Executive employment shall be based entirely in Melville, New
York and he shall not be required to be absent from there on travel status or
otherwise for more than a reasonable time each year as necessary or appropriate
for the performance of the Executive's duties hereunder.
4. Compensation.
(a) For the period September 1, 2003 through December 31, 2003, the
existing compensation agreement shall remain in force. The Executive is
currently working under an employment agreement ("Prior Agreement") which
provides for a base salary, management evaluation bonus, stock options and
fringe benefits. Any and all amounts earned under that Prior Agreement prior to
and including December 31, 2003 shall be paid in accordance with that Prior
Agreement even if the payments are to be paid at a later date after December 31,
2003.
(b) During the term of this Agreement, the Company shall pay the
Executive, and the Executive agrees to accept a base salary at the rate of not
less than $576,000.00 per year (the annual base salary as increased from time to
time during the term of this Agreement being hereinafter referred to as the
"Base Salary"). The Base Salary shall be paid in installments no less frequently
than monthly. Any increase in Base Salary or other compensation shall not limit
or reduce any other obligation of the Company hereunder, and once established at
an increased specified rate, the Executive's Base Salary hereunder shall not
thereafter be reduced.
(c) For each of the calendar years during the term of this
Agreement, the Company shall pay the Executive, a management evaluation bonus,
the amount of which will be determined by the Company's Chief Executive Officer
based on his evaluation of the Executive's overall performance during the year
according to mutually agreed upon criteria. The amount of the management
evaluation bonus will be targeted at $320,000 with a minimum bonus guaranteed at
$170,000 and a maximum bonus of $470,000. The management evaluation bonus for a
given year will be paid no later than the last day of March of the succeeding
year. Notwithstanding anything to the contrary, the Executive will not be
entitled to any unpaid bonuses if he is no longer an employee of the Company.
(d) The Executive will be eligible to participate in the Company's
stock option plan. Upon execution of this Agreement, the Executive shall receive
an option award for 10,000 shares of the existing class of the common stock of
the Company. One-half of the award (5,000 shares) shall vest and be exercisable
three years following the date this Agreement is executed. The remainder of the
award (5,000 shares) shall vest and be exercisable three years following the
date this Agreement is executed. The complete terms of the option award and
stock grant will be governed by the Company's omnibus stock option plan.
(e) During the term of this Agreement, the Executive shall be
entitled to fringe benefits, in each case at least equal to and on the same
terms and conditions as those attached to the Executive's office on the date
hereof, as the same may be improved from time to time during the term of this
Agreement, as well as to reimbursement, upon proper accounting, of all
reasonable expenses and disbursements incurred by the Executive in the course of
the Executive's duties.
(f) The Executive will be provided with relocation reimbursement, as
detailed on the attached addendum, for real estate commissions, moving expenses,
temporary housing, travel expenses associated with his relocation to the Long
Island, New York area. The aggregate
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amount of these expenses shall not exceed $105,000.00. The Executive agrees to
reimburse the Company for amounts it paid to relocate the Executive if the
Executive voluntarily resigns or is terminated for cause, including gross
misconduct, as defined in Section 5, within one year of the Executive's
relocation.
5. Termination of Employment. The employment created hereby is at
will. The Company may terminate this Agreement by discharging the Executive. The
Executive may terminate this Agreement by resigning with four weeks notice to
the Company. Discharge or resignation may be for any reason or for no reason. If
the Company chooses to discharge the Executive, it will deliver a letter of
discharge pursuant to the notice provisions of section 9. If the Executive
chooses to resign, the Executive will deliver a letter of resignation pursuant
to the notice provisions of section 9. If the Company terminates this Agreement
without cause prior to its expiration, the Company will pay the Executive a
severance award equal to $2,043.77 per day for the number of days from the date
of discharge to December 31, 2005. If any person or entity other than Michael
Strauss obtains control of 50% or more of the voting securities of the Company,
and the Executive is discharged as a result thereof, or the Executive's
responsibilities are diminished as a result thereof and the Executive
consequently resigns, then the Company or its successor will pay the Executive a
severance award equal to $2,043.77 per day for the number of days from the date
of discharge or resignation to December 31, 2005.
6. Entire Agreement; Amendment.
(a) This Agreement contains the entire understanding of the parties
with respect to the subject matter hereof and supersedes any and all other
agreements between the parties, their predecessors and affiliates.
(b) Any amendment of this Agreement shall not be binding unless in
writing and signed by both (i) the Company's Chief Executive Officer and (ii)
the Executive.
7. Enforceability. In the event that any provision of this Agreement
is determined to be invalid or unenforceable, the remaining terms and conditions
of this Agreement shall be unaffected and shall remain in full force and effect,
and any such determination of invalidity or enforceability shall not affect the
validity or enforceability of any other provision of this Agreement.
8. Notices. All notices which may be necessary or proper for either
the Company or the Executive to give to the other shall be in writing and shall
be sent by hand delivery, registered or certified mail, return receipt requested
or overnight courier, if to the Executive, to him at [address omitted] and, if
to the Company, to it at its principal executive offices at 520 Broadhollow
Road, Melville, NY 11747, Attention: Corporate Counsel, with a copy to
Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York 10038,
Attention: Louis Bevilacqua, Esq. and shall be deemed given when sent. Either
party may by like notice to the other party change the address at which it is to
receive notices hereunder.
9. Non-Disparagement, Non-Solicitation, Confidential Information.
The Company and the Executive agree that neither will disparage the other and
that their representatives will not disparage either party hereto. The Executive
agrees that for a period of one year following the termination of this
Agreement, the Executive will not solicit any employee of the Company to leave
the Company or hire any employee of the Company. The
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Company and the Executive agree to keep the terms of this Agreement confidential
except that the Executive may divulge the terms of this Agreement to the
Executive's spouse, attorney, financial advisor and accountant provided they
agree to keep the terms of this Agreement confidential. The Executive agrees to
protect, not disclose, and not use for the Executive's benefit any confidential
information or trade secrets belonging to the Company, including information
regarding proprietary procedures and techniques, accounts, or personnel
(excepting information that was already disclosed by the Company or otherwise
was made public other than by breach of this Agreement by the Executive). The
preceding two sentences shall not apply to disclosures required due to the laws
or regulations of governments, or the orders of courts having jurisdiction over
the Company and the Executive. This section 9 shall survive the termination of
this Agreement.
10. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND BE
ENFORCEABLE IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first written above.
American Home Mortgage Holdings, Inc.
By: /s/ Michael Strauss
---------------------------------
Name: Michael Strauss
Title: Chief Executive Officer
/s/ Ron Rosenblatt, Ph.D.
-------------------------------------
Ron Rosenblatt, Ph.D.
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Addendum
American Home Mortgage
Employee Relocation Program
The following represents American Home Mortgage's Relocation Program. You will
be eligible for expense reimbursement based on the criteria specified below:
o Real estate broker's commissions up to 6%. (Estimated at $54,000)
o No fee points/Reduced interest rate mortgage. All fees/taxes
associated with the purchase of a new home and the securing of a new
mortgage will be waived or paid by AHM. (estimated at $20,000)
o We will cover temporary housing expenses for a period not to exceed
60 days while you transition to permanent housing. We can assist
also you in securing temporary housing in the area. (estimated at
$5,000)
o You are responsible for securing a household moving vendor. American
Home Mortgage will cover the cost of this move (estimated at
$20,000).
o American Home will reimburse travel expenses associated with spouse
and children trip (maximum of 4) for the purpose of finding a home
and schools while you seek permanent housing in the area (Estimated
at $6,000).
It is understood that failure to remain with the Company, due to a voluntary
resignation, for a period of at least one year will require the immediate
reimbursement to American Home by you for any payments made by the Company up to
that point.
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