Employment Agreement - IndyMac Bank FSB and Richard H. Wohl
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") has been executed as of November 1,
2002 by and between IndyMac Bank, F.S.B. ("Employer") and Richard H. Wohl
("Officer").
WITNESSETH:
WHEREAS, Employer and Officer have entered into that certain Employment
Agreement, dated as of February 4, 2000, as amended December 1, 2000 (the
"Original Agreement");
WHEREAS, Employer and Officer desire to (i) enter into a new employment
agreement upon the terms set forth in this Agreement and (ii) terminate the
Original Agreement;
WHEREAS, Employer desires to obtain the benefit of continued services of Officer
and Officer desires to continue to render services to Employer and its
affiliates;
WHEREAS, Employer and Officer desire to set forth the terms and conditions of
Officer's employment with Employer and its affiliates under this Agreement; and
WHEREAS, as of the date of this Agreement, the parties hereby intend that the
Original Agreement shall automatically terminate and be of no further force and
effect, and neither parties have any further rights or obligations thereunder.
NOW, THEREFORE, in consideration of the mutual promises and covenants herein
contained, the parties hereto agree as follows:
1. TERM. Employer agrees to employ Officer and Officer agrees to serve
Employer and its affiliates, in accordance with the terms hereof, for a
term beginning on the date first written above and ending on December 31,
2007, unless earlier terminated in accordance with the provisions hereof.
2. POSITION, DUTIES AND RESPONSIBILITIES. Employer and Officer hereby agree
that, subject to the provisions of this Agreement, Employer will employ
Officer and Officer will serve Employer, as a Senior Executive Vice
President of Employer, or its affiliated companies, as determined by
Employer. Affiliated companies shall include, without limitation, any
direct or indirect subsidiary of Employer in which Employer holds less
than 100% but at least a majority of the beneficial interest and voting
control (a "New Public Company"). Employer agrees that Officer's duties
hereunder shall be the usual and customary duties of such office and such
further duties shall not be inconsistent with the provisions of applicable
law. Officer agrees that Employer may add to or change Officer's duties as
business considerations dictate, provided such changes are consistent with
a Senior Executive Vice President position of Employer as determined by
the Chief Executive Officer of Employer. Officer shall have such
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official power and authority as shall reasonably be required to enable him
to discharge his duties in the offices which he may hold. All compensation
paid to Officer by Employer or any of its affiliates shall be aggregated
in determining whether Officer has received the benefits provided for
herein, but without prejudice to the allocation of costs among the
entities to which Officer renders services hereunder.
3. SCOPE OF THIS AGREEMENT AND OUTSIDE AFFILIATIONS. During the term of this
Agreement, Officer shall devote his full business time and energy, except
as expressly provided below, to the business, affairs and interests of
Employer and its affiliates, and matters related thereto, and shall use
his best efforts and abilities to promote their respective interests.
Officer agrees that he will diligently endeavor to promote the business,
affairs and interests of Employer and its affiliates and perform services
contemplated hereby, in accordance with the policies established by the
Board of Directors of the applicable entity, which policies shall be
consistent with this Agreement. If so requested by Employer, Officer
agrees to serve without additional remuneration as an officer of one or
more (direct or indirect) subsidiaries, affiliates or successors of
Employer, subject to appropriate authorization by the affiliate,
subsidiary or successor involved and any limitation under applicable law.
During the course of Officer's employment as a full-time officer
hereunder, Officer shall not, without the consent of Employer, compete,
directly or indirectly, with Employer in the business then conducted by
Employer or any of its affiliates or successors.
Officer may make and manage personal business investments of his choice
and serve in any capacity with any civic, educational or charitable
organization, or any governmental entity or trade association, without
seeking or obtaining approval by the Board of Directors, provided such
activities and services do not materially interfere or conflict with the
performance of his duties hereunder.
4. COMPENSATION AND BENEFITS.
a. BASE SALARY. Employer shall pay to Officer a base salary in respect
of the fiscal year of Employer (a "Fiscal Year") ending December 31,
2002 and 2003 at the annual rate of $600,000 (the "Annual Rate"). In
respect of the Fiscal Years ending in 2004, 2005, 2006 and 2007, the
Chief Executive Officer of Employer may increase the Annual Rate,
with the approval of the Board of Directors. Any increase in rate
shall thereafter be the "Annual Rate" hereunder. During the term of
this Agreement, Employer may not decrease the Annual Rate.
b. INCENTIVE COMPENSATION. Employer shall pay to Officer for each of
the Fiscal Years ending during the term of this Agreement an
incentive compensation award in an amount determined pursuant to the
Annual Incentive Plan attached hereto as Appendix A. The terms of
the Annual Incentive Plan shall be determined in the first quarter
of each Fiscal year during the term of this Agreement, as mutually
agreed upon by Employer and Officer. The annual
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target incentive shall be 50% of the Annual Rate ("Target Incentive
Amount") and the maximum annual incentive payable shall be 100% of
the Annual Rate. If a new annual incentive plan is not executed by
Employer and Officer for any reason by the end of the first quarter
of the Fiscal Year (or within 90 days of the date of this Agreement
for the year 2002), then the maximum incentive compensation award
for the new Fiscal Year shall be deemed set at 25% of Officer's base
salary. Unless stated otherwise in Sections 5 (a), (b), (d) or (e),
in order to be eligible for the incentive compensation award,
Officer must still be employed as of March 31st of the Fiscal Year
following the relevant Fiscal Year. The incentive compensation award
payable to Officer for any Fiscal Year shall be paid no later than
thirty (30) days after completion and publication of the applicable
audited financial statements for such Fiscal Year.
c. STOCK OPTIONS AND RESTRICTED STOCK. Employer's public company
affiliate, IndyMac Bancorp, Inc., or any successor public company
("Public Company"), shall grant to Officer a stock option grant of
500,000 shares of the Public Company's common stock on December 2,
2002 (the "Option"). The Option shall vest equally over 5 years from
the date of grant.
Officer agrees that any stock options or restricted stock granted to
him under his prior Employment Agreement(s), or granted separate
from any such Employment Agreement(s), shall be subject to the terms
of the 2002 Stock Option Plan except as may be expressly provided
otherwise in this Agreement.
All stock options and restricted stock granted in accordance with
this Section 4(c): (i) shall be granted pursuant to the Public
Company's current stock option plan, or such other stock option plan
or plans as may be or come into effect during the term of this
Agreement, (ii) shall be priced and vest in accordance with the
terms set by the Management Development and Compensation Committee
of the Board of Directors of the Public Company ("Compensation
Committee"), (iii) shall be subject to such other reasonable terms
and conditions as may be determined by the Compensation Committee
and set forth in the agreement or other document evidencing the
award, (iv) in the event that Officer's employment is terminated due
to death, Disability, or for Good Reason (as defined in Section
5(d)), shall, if then unvested, become immediately and fully vested,
(v) in the event that Officer's employment is terminated through
resignation or by Employer for Cause (as defined in Section 5(c)),
shall, if not then vested, immediately terminate, (vi) in the event
that Officer's employment is terminated by Employer other than for
Cause (as defined in Section 5(e)), shall, if not then vested,
become immediately and fully vested only to the extent that such
restricted stock or stock options would, under the terms of such
restricted stock or stock options, vest within one (1) year of such
termination, (vii) in the event of a Change in Control (as defined
in Appendix B), shall, if not then vested, become vested on the one
year anniversary date of the Change in Control, provided Officer is
still employed by Employer or its successor on such date,(viii)
shall, if Officer is terminated under the terms of Section 5 (a),
(b), (d) or (e) within one year of Change in
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Control, shall immediately and fully vest (ix) in the event that
this Agreement terminates according to its terms (as provided in
5(g)), shall become immediately and fully vested, and (x) shall give
Officer the right, after a termination other than by Officer's
resignation or by Employer for Cause, to exercise such options for a
period of twelve (12) months ) (but in no event later than their
expiration date).
In the event that a New Public Company is formed and Officer is
assigned by the Chief Executive Officer to be employed by that New
Public Company, if such New Public Company is traded on the New York
Stock Exchange or the NASDAQ, then, in the discretion of the Chief
Executive Officer, up to 50% of the not-yet-vested stock options and
restricted stock of Officer (whether previously granted hereunder or
otherwise) may be terminated and replaced with such alternate
incentive compensation (which may include stock options and/or
restricted stock of the New Public Company) as the Chief Executive
Officer may determine in his sole and absolute discretion, provided
such replacement compensation is equivalent to the value of the
replaced stock options and restricted stock. Such alternate
incentive compensation may be granted on such terms and conditions
as determined by the Chief Executive Officer, which terms and
conditions may differ from those in this Agreement for comparable
compensation, provided such terms and conditions provide an
equivalent value to the replaced compensation. The Company shall
select and retain a nationally recognized firm to determine the
value of the stock options and restricted stock to be replaced and
the value of the replacement compensation, and such firm's final
valuation shall be accepted by both parties.
d. DEFERRED COMPENSATION. On January 1, 2004 (the "Credit Date"),
Employer shall credit Officer's account (the "Account") under the
IndyMac Bancorp, Inc. Deferred Compensation Plan (the "Deferred
Compensation Plan") with $1,500,000 (the "Deferred Compensation
Credit"), which amount shall vest as follows. Twenty percent (20%)
of such amount plus any accrued earnings thereon (the "Deferred
Amount") shall vest on the day before each anniversary of the Credit
Date so that the Deferred Amount shall be fully vested on the day
before the fifth anniversary of the Credit Date and as otherwise
provided herein. The Deferred Amount shall become payable to Officer
in accordance with Officer's distribution election under the
Deferred Compensation Plan but in no event earlier than thirty (30)
days following the Termination Date (as defined in Section 5(g)). In
the event of the termination of Officer's employment (whether before
or after the Credit Date)pursuant to Sections 5(a), (b), (d), or
(e), the entire amount of the Deferred Compensation Credit shall be
vested. In the event of the termination of Officer's employment
pursuant to Sections 5(c) or (f), any unvested portion of the
Deferred Compensation Credit shall be forfeited on the Termination
Date.
e. ADDITIONAL BENEFITS. Officer shall also be entitled to all rights
and benefits for which he is otherwise eligible under any bonus
plan,
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stock purchase plan, participation or extra compensation plan,
executive compensation plan, pension plan, profit-sharing plan,
deferred compensation plan, life and medical insurance policy, or
other plans or benefits, which Employer or its subsidiaries may
provide for him, or provided he is eligible to participate therein,
for senior officers generally or for employees generally, during the
term of this Agreement (collectively, "Additional Benefits").
Officer shall also be entitled to four (4) weeks of vacation each
Fiscal Year, subject to all applicable policies of Employer relating
to vacation time. This Agreement shall not affect the provision of
any other compensation, retirement or other benefit program or plan
of Employer. If Officer's employment is terminated hereunder,
pursuant to Section 5(a), 5(b) or 5(e), Employer shall continue for
the period specified in Section 5(a), 5(b) or 5(e) hereof, to
provide benefits substantially equivalent to the life, disability
and medical insurance policies on behalf of Officer and his
dependents and beneficiaries which were being provided to them
immediately prior to Officer's Termination Date, but only to the
extent that Officer is not entitled to comparable benefits from
other employment.
f. DEFERRAL OF AMOUNTS PAYABLE HEREUNDER. In the event Officer should
desire to defer receipt of any cash payments to which he would
otherwise be entitled hereunder, he may present such a written
request to the Compensation Committee which, in its sole discretion,
may enter into a separate deferred compensation agreement with
Officer.
g. CLUB MEMBERSHIPS. Employer shall pay standard annual and monthly
membership fees and any business related charges for Officer's
participation in the La Canada Flintridge Country Club and such
other memberships as may be approved by the Chief Executive Officer.
h. SPLIT DOLLAR LIFE INSURANCE. Employer shall provide a split dollar
whole life insurance policy on the life of Officer for the benefit
of a beneficiary designated by Officer and owned by Employer in a
face amount equal to three (3) times Officer's Annual Rate with
Officer not being required to make any payment thereon (other than
payment of any tax obligations) and Employer's recovery being
limited to the lesser of the cash surrender value of the policy and
the premiums paid and a right to assume the policy on any
termination in exchange for Employer's interest; provided, however,
that if Employer cannot purchase a split dollar life insurance
policy on behalf of Officer at standard rates, then the face amount
of the insurance policy shall be reduced to that amount purchasable
by Employer at standard rates, and provided further, that the
purchase of split dollar life insurance is permissible by law for
executives of Officer's level. If the purchase of split dollar life
insurance is not permissible by law for executives of Officer's
level, Employer shall have no obligation to purchase such insurance.
i. CAR ALLOWANCE. Employer shall either provide Officer with an
appropriate luxury automobile for Officer's exclusive use or pay
Officer an equivalent monthly automobile allowance which shall in
either case include car insurance,
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maintenance and operating expenses, such automobile or amount to be
mutually agreed to by the Compensation Committee and Officer.
5. TERMINATION. The compensation and benefits provided for herein and the
employment of Officer by Employer shall be terminated only as provided for
below in this Section 5:
a. DISABILITY. In the event that Officer shall fail (with or without
reasonable accommodation), because of illness, injury or similar
incapacity ("Disability"), to render for four (4) consecutive
calendar months, or for shorter periods aggregating eighty (80) or
more business days in any twelve (12) month period, services
contemplated by this Agreement, Officer's full-time employment
hereunder may be terminated, by written Notice of Termination from
Employer to Officer; and thereafter, Employer shall continue, from
the Termination Date until Officer's death or December 31, 2007,
whichever first occurs (the "Disability Payment Period"), (i) to pay
compensation to Officer, in the same manner as in effect immediately
prior to the Termination Date, in an amount equal to (1) fifty
percent (50%) of the then existing Annual Rate payable immediately
prior to the termination, minus (2) the amount of any cash payments
due to him under the terms of Employer's disability insurance or
other disability benefit plans (which are paid for by Employer) or
Employer's tax-qualified Defined Benefit Pension Plan, and any
compensation he may receive pursuant to any other employment, and
(ii) to provide during the greater of the Disability Payment Period
or two years, the additional benefits specified in the last sentence
of Section 4(e) hereof. To the extent not otherwise vested, all
outstanding stock options and restricted stock granted to Officer
pursuant to Section 4(c) will vest upon his termination because of
Disability.
The determination of Disability shall be made only after 30 days'
notice to Officer (which may run concurrently with the Notice of
Termination). In order to determine Disability, both Employer and
Officer shall have the right to provide medical evidence to support
their respective positions, with the ultimate decision regarding
Disability to be made by a majority of the members of Employer's
Benefits Committee.
b. DEATH. In the event that Officer shall die during the term of this
Agreement, Employer shall pay to such person or persons as Officer
shall have directed in writing or, in the absence of a designation,
to his estate (the "Beneficiary") an amount equal to two times the
Annual Rate. Such payment shall be made within 45 days of the death
of Officer. Employer shall also provide during the two year period
following the date of Officer's death the additional benefits
specified in the last sentence of Section 4(e) hereof. If Officer's
death occurs while he is receiving payments for Disability under
Section 5(a) above, such payments shall cease and the Beneficiary
shall be entitled to the payments and benefits under this Section
5(b). This Agreement in all other respects will terminate upon the
death of Officer; provided, however, that (i) the termination
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of the Agreement shall not affect Officer's entitlement to all other
benefits in which he has become vested or which are otherwise
payable in respect of periods ending prior to its termination, and
(ii) to the extent not otherwise vested, all outstanding stock
options and restricted stock granted to Officer pursuant to Section
4(c) will vest upon his death.
c. CAUSE. Employer may terminate Officer's employment under this
Agreement for "Cause." A termination for Cause is a termination by
reason of (i) a material breach of this Agreement by Officer (other
than as a result of incapacity due to physical or mental illness)
which is committed in bad faith or without reasonable belief that
such breach is in the best interests of Employer, (ii) an act or
omission to act by the Officer involving commission of a fraud,
theft, or any knowing or deliberate action or inaction in
contravention of a material direct order from the Officer's direct
supervisor which is within the scope of this Agreement and does not
involve the performance of an illegal act or omission to act, (iii)
entry of an order duly issued by any federal or state regulatory
agency having jurisdiction in the matter removing Officer from
office of Employer or its affiliates or permanently prohibiting him
from participation in the conduct of the affairs of Employer or any
of its affiliates, or (iv) Officer's conviction of a felony, or
removal from office and/or suspension or temporary prohibition from
participating in the conduct of Employer's or any of its affiliates'
affairs by any federal or state regulatory authority having
jurisdiction in the matter. If Officer is terminated pursuant to
this Section 5(c)(iii) or 5(c)(iv), Employer's obligations under
Sections 4(a), 4(b), 4(c), and 4(d) hereof shall be automatically
suspended; provided, however, that if the charges resulting in such
removal or prohibition are finally dismissed or if a final judgment
on the merits of such charges is issued in favor of Officer, or if
the conviction is overturned on appeal, then Officer shall be
reinstated in full with back pay for the removal period plus accrued
interest at the rate then payable on judgments. During the period
that Employer's obligations under Sections 4(a), 4(b), 4(c), and
4(d) hereof are suspended, Officer shall continue to be entitled to
receive life, disability and medical insurance policies under
Section 4(e) until the conviction of the felony, or misdemeanor
carrying a jail term, or removal from office has become final and
non-appealable. When the conviction of the felony or removal from
office has become final and non-appealable, all of Employer's
obligations hereunder shall terminate; provided, however, that the
termination of Officer's employment pursuant to this Section 5(c)
shall not affect Officer's entitlement to all benefits in which he
has become vested or which are otherwise payable in respect of
periods ending prior to his suspension or termination. Following a
termination for Cause, Officer shall be entitled to payment of his
base salary through his
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last day of employment, and any accrued vacation pay, but no other
payments or benefits hereunder or otherwise whatsoever.
d. GOOD REASON. Officer may terminate Officer's employment at any time
for "Good Reason." "Good Reason" means that any one or more of the
following have occurred without Officer's written consent (other
than as a result of Officer's Disability or termination of Officer's
employment for Cause) which is not cured by Employer within 30 days
after written notice thereof is given to Employer by Officer:
(i) other than temporarily as a result of Officer's suspension
as provided in Section 5(c), any material diminution in Officer's
then powers, reporting requirements, duties or responsibilities,
provided such diminution occurs following a Change in Control or is
instigated by someone other than the Chief Executive Officer or the
members of the Board of Directors who are members as of the date of
this Agreement,
(ii) Officer is required to relocate his place of employment
to a location which is more than 50 miles from IndyMac Bank's
current headquarters, or
(iii) any material breach by Employer of the terms of this
Agreement. If, during the term of this Agreement, Officer's
employment shall be terminated by Officer for Good Reason, Officer
shall receive the payments and benefits described in Section 5(e).
e. TERMINATION OTHER THAN FOR CAUSE.
(i) Except as provided in Section 5(e)(ii) below, if during the
term of this Agreement, Officer's employment shall be
terminated by Employer other than for Cause, then Officer
shall be entitled to:
(1) payment of his base salary through his last day of
employment, but no payment on account of any further
incentive compensation hereunder, and
(2) within 30 days after such last day, a single payment in
an amount equal to two (2) times the sum of the Annual
Rate and the Target Incentive Amount, plus a pro-rata
bonus for the Fiscal Year in which Officer is
terminated, the amount of which will be determined in
the sole and absolute discretion of Employer, and
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(3) for a period of two years following such last day, the
benefits specified in the last sentence of Section 4(e)
hereof.
(ii) Not withstanding anything in this Agreement to the contrary,
in the event it shall be determined that any payment or
distribution by Employer or any other person or entity to or
for the benefit of Officer (within the meaning of Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended
(the "Code")), whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or
otherwise in connection with, or arising out of, his
employment with Employer or a change in ownership or effective
control of Employer or a substantial portion of its assets (a
"Payment"), would be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), the Payments
shall include gross-up for any excise taxes due under IRC 280G
or similar "golden parachute" provisions plus any excise,
income, or payroll taxes owed on the payment on the excise
payment amount.
(iii) In order to receive the amounts provided by Sections 5(e),
other than base salary through the last day of employment,
Officer agrees that for a period of one year after termination
of employment by Employer other than for Cause, Officer shall
not engage in any business, whether as an employee,
consultant, partner, principal, agent, representative or
stockholder (other than as a stockholder of less than 1%
equity interest) or in any other corporate or representative
capacity with any other business whether in corporate,
proprietorship, or partnership form or otherwise, where such
business is engaged in any activity which competes with the
business of Employer or its subsidiaries or affiliates, as
conducted on the date Officer's employment terminated or which
will compete with any proposed business activity of Employer
or its subsidiaries or affiliates, in the planning stage on
such date.
If the foregoing agreement is determined invalid or unenforceable by a
Court in an interpretation of this Agreement, then Officer agrees that he
shall return the amounts received pursuant to Sections 5(e), other than
the base salary through the last day of employment.
f. RESIGNATION
If during the term of this Agreement, Officer shall resign other
than for Good Reason, Officer shall be entitled to payment of his
base salary through his last day of employment, but all other rights
to payment or benefits hereunder shall immediately terminate;
provided, however, that the termination of Officer's employment
pursuant to this Section 5(f) shall not affect Officer's entitlement
to all benefits in which he has become vested or which are otherwise
payable in respect of periods ending prior to his termination of
employment, and all
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obligations of Officer under Sections 9(f) and 9(j) shall expressly
survive such termination.
g. NOTICE OF TERMINATION. Any purported termination by Employer or by
Officer (including any resignation) shall be communicated by a
written Notice of Termination to the other party hereto which
indicates the specific termination provision in this Agreement, if
any, relied upon and which sets forth in reasonable detail the facts
and circumstances, if any, claimed to provide a basis for
termination of Officer's employment under the provision so
indicated. For purposes of this Agreement, no such purported
termination shall be effective without such Notice of Termination.
The "Termination Date" shall mean the date specified in the Notice
of Termination, which shall be no less than 30 or more than 60 days
from the date of the Notice of Termination. Notwithstanding any
other provision of this Agreement, in the event of any termination
of Officer's employment hereunder for any reason, Employer shall pay
Officer his full base salary through the Termination Date, plus any
Additional Benefits which have been earned or become payable, but
which have not yet been paid, as of such Termination Date.
6. LOCATION OF SERVICES. Officer is required to perform his services under
this Agreement at such present or future business location of Company as
may be designated by the Chief Executive Officer in the Counties of Los
Angeles, Orange or Ventura, California or wherever the Corporate
Headquarters of Employer may be located.
a. IN GENERAL. If Employer requests Officer to relocate outside of the
locations referenced above, Officer shall have the option of
agreeing to such relocation and the terms of this Agreement shall
continue in full force and effect. If Officer declines to relocate
outside of the locations referenced above, either the Officer or
Employer shall provide the other party with a Notice of Termination
in accordance with Section 5(g) and the Officer will be deemed to
have been terminated pursuant to Section 5(e).
b. CHANGE IN CONTROL. For two years following a change in control of
the Company, as declared by the Board of Directors, Employer may
only require Officer to relocate within the three counties
identified above and only if such relocation is to the Corporate
Headquarters location of Employer. During this time period, if
Employer requests that Officer relocate outside of the three
counties identified above, or within the three counties, but not to
the Corporate Headquarters location, Officer shall have the option
of agreeing to such relocation and the terms of this Agreement shall
continue in full force and effect. If Officer declines to relocate
outside of the locations referenced above, either the Officer or
Employer shall provide the other party with a Notice of Termination
in accordance with Section 5(g) and the Officer will be deemed to
have been terminated pursuant to Section 5(e).
7. REIMBURSEMENT OF BUSINESS EXPENSES. During the term of this Agreement,
Employer shall reimburse Officer promptly for all business expenditures to
the extent
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that such expenditures meet the requirements of the Code for deductibility
by Employer for federal income tax purposes or are otherwise in compliance
with the rules and policies of Employer and are substantiated by Officer
as required by the Internal Revenue Service and rules and policies of
Employer.
8. INDEMNITY. To the extent permitted by applicable law, the Certificate of
Incorporation and the By-Laws of Employer (as from time to time in effect)
and any indemnity agreements entered into from time to time between
Employer and Officer, Employer shall defend and indemnify Officer and hold
him harmless for any acts or decisions made by him in good faith while
performing services for Employer (including any subsidiary or affiliate of
Employer), and shall use reasonable efforts to obtain coverage for him
under liability insurance policies now in force or hereafter obtained
during the term of this Agreement covering the other officers or directors
of Employer. To the full extent permitted by law, so long as Employer (or
a successor) maintains directors' and officers' liability insurance for
its executives or directors, Employer shall continue to provide Officer
following the Termination Date with directors' and officers' liability
insurance insuring Officer against insurable events which occur or have
occurred while Officer was a director or officer of Employer or an
affiliate or a fiduciary of an employee benefit plan of any of the
foregoing, such insurance to have policy limits aggregating not less than
the amount in effect immediately prior to the Termination Date.
9. MISCELLANEOUS.
a. SUCCESSORSHIP. This Agreement shall inure to the benefit of and
shall be binding upon Employer, its successors and assigns, but
without the prior written consent of Officer, this Agreement may not
be assigned other than in connection with a merger or sale of
Employer or the sale of substantially all the assets of Employer or
similar transaction. Notwithstanding the foregoing, Employer may
assign, whether by assignment agreement, merger, operation of law or
otherwise, this Agreement to the Public Company or to any successor
or affiliate of Employer or the Public Company, subject to such
assignee's express assumption of all obligations of Employer
hereunder. The failure of any successor to or assignee of the
Employer's business and/or assets in such transaction to expressly
assume all obligations of Employer hereunder shall be deemed a
Termination Other Than For Cause pursuant to Section 5(e).
The obligations and duties of Officer hereby shall be personal and
not assignable.
b. NOTICES. Any notices provided for in this Agreement shall be sent to
Employer at its corporate headquarters, Attention: General Counsel,
with a copy to the Director of Human Resources at the same address,
or to such other address as Employer may from time to time in
writing designate, and to Officer at such address as he may from
time to time in writing designate (or his business address of record
in the absence of such designation). All notices shall be deemed to
have been given two (2) business days after they have been
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deposited as certified mail, return receipt requested, postage paid
and properly addressed to the designated address of the party to
receive the notices.
c. ENTIRE AGREEMENT. This instrument contains the entire agreement of
the parties relating to the subject matter hereof, and it replaces
and supersedes any prior agreements between the parties relating to
said subject matter; provided, however, that all provisions of
Employer's Employee Handbook shall be incorporated herein by this
reference and Officer hereby expressly acknowledges that all
provisions of the Employee Handbook are applicable to his employment
relationship with Employer, except to the extent that any such
provisions directly conflict with any term contained in this
Agreement; provided, further, that Officer hereby expressly
acknowledges that Officer has executed Employer's standard
Arbitration Agreement which generally requires that any dispute
under this Agreement will be arbitrated. No modifications or
amendments of this Agreement shall be valid unless made in writing
and signed by the parties hereto.
d. WAIVER. The waiver of the breach of any term or of any condition of
this Agreement shall not be deemed to constitute the waiver of any
other breach of the same or any other term or condition.
e. CALIFORNIA LAW. This Agreement shall be construed and interpreted in
accordance with the laws of California, without reference to its
conflicts of laws principles.
f. CONFIDENTIALITY. Officer hereby acknowledges and agrees that
Employer and its affiliates have developed and own valuable
information related to their business, personnel and customers,
including, but not limited to, concepts, ideas, customer lists,
business lists, business and strategic plans, financial data,
accounting procedures, secondary marketing and hedging models, trade
secrets, computer programs and plans, and information related to
officers, directors, employees and agents. Officer hereby agrees
that all such information, and all codes, concepts, copies and forms
relating to such information, Employer's plans and intentions with
respect thereto, and any information provided by Employer or its
affiliates to Officer with respect to any of the foregoing, shall be
considered "Confidential Information" for the purpose of this
Agreement. Officer acknowledges and agrees that all such
Confidential Information is a valuable asset of Employer, and if
developed by Officer, is developed by Officer in the course of
Officer's employment with Employer, and is the sole property of
Employer. Officer agrees that he will not divulge or otherwise
disclose, directly or indirectly, any Confidential Information
concerning the business or policies of Employer or any of its
affiliates which he may have learned as a result of his employment
during the term of this Agreement or prior thereto as an employee,
officer or director of or consultant to Employer or any of its
affiliates, except to the extent such use or disclosure is (i)
necessary or appropriate to the performance of this Agreement and in
furtherance of Employer's best interests, (ii) required by
applicable law
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or in response to a lawful inquiry from a governmental or regulatory
authority, (iii) lawfully obtainable from other sources, or (iv)
authorized by Employer. Furthermore, in order to protect the trade
secret or confidential information of Employer, Officer hereby
agrees not to accept any employment or engage in any activities
competitive with the Employer for a period of one year after
termination of employment if the loyal and complete fulfillment of
the duties of the competitive employment or activities would
inherently call upon Officer to reveal or use any of the trade
secret or Confidential Information of Employer to which Officer had
access during employment by Employer. The provisions of this
subsection shall survive the expiration, suspension or termination,
for any reason, of this Agreement.
g. REMEDIES OF EMPLOYER. Officer acknowledges that the services he is
obligated to render under the provisions of this Agreement are of a
special, unique, unusual, extraordinary and intellectual character,
which gives this Agreement peculiar value to Employer. The loss of
these services cannot be reasonably or adequately compensated in
damages in an action at law and it would be difficult (if not
impossible) to replace these services. By reason thereof, Officer
agrees and consents that if he violates any of the material
provisions of this Agreement, Employer, in addition to any other
rights and remedies available under this Agreement or under
applicable law, shall be entitled during the remainder of the term
to seek injunctive relief, from a tribunal of competent
jurisdiction, restraining Officer from committing or continuing any
violation of this Agreement. The provisions of this subsection shall
survive the expiration, suspension or termination, for any reason,
of this Agreement.
h. SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable, the remainder of this Agreement shall nevertheless
remain in full force and effect, and if any provision is held
invalid or unenforceable with respect to particular circumstances,
it shall nevertheless remain in full force and effect in all other
circumstances.
i. NO OBLIGATION TO MITIGATE. Officer shall not be required to mitigate
the amount of any payment provided for in this Agreement by seeking
other employment or otherwise and, except as provided in Section
5(a) hereof, no payment hereunder shall be offset or reduced by the
amount of any compensation or benefits provided to Officer in any
subsequent employment.
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j. NO SOLICITATION.
(i) IN GENERAL. Officer agrees that during employment and for a
period of one year after termination of such employment,
Officer shall not:
(1) Solicit, or cause to be solicited, any customers of
Employer for purposes of promoting or selling any
products or services competitive with those of Employer;
(2) Solicit business from, or perform services for, any
company or other business entity which at any time
during the two year period immediately preceding
Officer's termination of employment with Employer was a
client of Employer, or its subsidiaries or affiliates;
or
(3) Solicit for employment, offer, or cause to be offered,
employment, either on a full time, part time, or
consulting basis, to any person who was employed by
Employer or its subsidiaries or affiliates on the date
Officer's employment terminated, unless Officer shall
have received the prior written consent of Employer.
(ii) CONSIDERATION. The consideration for the foregoing covenants,
as well as the covenants in Section 5(e)(iii), the sufficiency
of which is hereby acknowledged, is Employer's agreement to
continue to employ Officer and provide compensation and
benefits pursuant to this Agreement, including but not limited
to Section 5(e).
(iii) EQUITABLE RELIEF AND OTHER REMEDIES. Officer acknowledges and
agrees that Employer's remedies at law for a breach or
threatened breach of any of the provisions of this Section
would be inadequate and, in recognition of this fact, Officer
agrees that, in the event of such a breach or threatened
breach, in addition to any remedies at law, Employer, without
posting any bond, shall be entitled to obtain equitable relief
in the form of specific performance, a temporary restraining
order, a temporary or permanent injunction or any other
equitable remedy which may then be available.
(iv) REFORMATION. The foregoing No Solicitation provisions are
intended to restrict Officer only to the extent permitted by
law in the jurisdiction where Officer is then a resident. To
the extent the No Solicitation Provisions would otherwise be
determined invalid or unenforceable by a Court of competent
jurisdiction, such Court shall exercise its discretion in
reforming the provisions of this Section to the end that
Officer shall be subject to reasonable no solicitation
provisions that are enforceable by Employer under the laws of
the jurisdiction where Officer is then a resident. If the laws
of the state where the Officer is then a resident completely
prohibit any form of the foregoing
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covenants, then Employer and Officer understand and agree that
the foregoing covenants are of no effect.
10. REGULATORY INTERVENTION. Notwithstanding anything in this Agreement to the
contrary, this Agreement is subject to the following terms and conditions:
(i) If Officer is suspended and/or temporarily prohibited from
participating in the conduct of Employer's affairs by a notice
served under Section 8(e)(3) or (g)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1818 (e)(3) and (g)(1)), Employer's
obligations hereunder shall be suspended as of the date of
service unless stayed by appropriate proceedings. If the
charges in the notice are dismissed, Employer shall (x) pay
Officer all or part of the compensation withheld while
Employer's contract obligations were suspended, and (y)
reinstate any of Employer's obligations which were suspended.
(ii) If Officer is removed and/or permanently prohibited from
participating in the conduct of Employer's affairs by an order
issued under Section 8(e)(4) or (g)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1818 (e)(4) and (g)(1)), all
obligations of Employer under this Agreement shall terminate
as of the effective date of the order, but vested rights of
the parties shall not be affected.
(iii) If Employer is in default (as defined in Section 3(x)(1) of
the Federal Deposit Insurance Act (12 U.S.C. 1813 (x)(1)), all
obligations under this Agreement shall terminate as of the
date of default, but any vested rights of Officer shall not be
affected.
(iv) All obligations under this Agreement shall be terminated,
except to the extent determined that continuation of the
contract is necessary for the continued operation of Employer,
(x) by the Office of Thrift Supervision ("OTS") at the time
the Federal Deposit Insurance Corporation ("FDIC") enters into
an agreement to provide assistance to or on behalf of Employer
under the authority contained in Section 13(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1823 (c)); or (y) by the OTS
at the time the OTS approves a supervisory merger to resolve
problems related to operation of Employer or when Employer is
determined by the OTS to be in an unsafe or unsound condition.
Any rights of Officer that shall have vested under this
Agreement shall not be affected by such action.
(v) With regard to the provisions of this Section 10(i) through
(iv):
A. Employer agrees to use its best efforts to oppose any
such notice of charges as to which there are reasonable
defenses;
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B. In the event the notice of charges is dismissed or
otherwise resolved in a manner that will permit Employer
to resume its obligations to pay compensation hereunder,
Employer will promptly make such payment hereunder; and
C. During the period of suspension, the vested rights of
the contracting parties shall not be affected except to
the extent precluded by such notice.
(vi) Any payments made to Officer by Employer pursuant to this
Agreement, or otherwise, are subject to and conditioned upon
their compliance with 12 U.S.C. 1828(k) and any regulations
promulgated there under.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
EMPLOYER
By:___________________________________________
Name: Michael W. Perry
Title: Vice Chairman and Chief Executive Officer
Officer:
______________________________________________
in his individual capacity
PARENT COMPANY GUARANTY
IndyMac Bancorp, Inc. ("Bancorp") is the parent holding company of Employer and
benefits directly from the strength and continuity of the management of
Employer. Accordingly, Bancorp hereby assures and guaranties the full and timely
satisfaction of all monetary and other obligations of Employer to Officer under
the Agreement. This guaranty is a guaranty of payment and not collection. This
guaranty shall continue in full force and effect notwithstanding any future
modifications, extensions or renewals to the Agreement that may be made by
Employer. Bancorp hereby waives any and all suretyship or other similar defenses
that may be available to it with respect to this guaranty to the full extent
permitted by applicable law.
IndyMac Bancorp, Inc.
By:___________________________________________
Michael W. Perry
Vice Chairman & Chief Executive Officer
Date: ________________________________________
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APPENDIX A
PROFIT CENTER
ANNUAL INCENTIVE PLAN
Officer Name: Richard Wohl
Annual Base Rate for 2002: $600,000
Target Annual Bonus for 2003: $300,000
Target Quarterly Bonus for 2003: $0
Annual or Quarterly Incentive Awards:
------------------------------------
Officer shall be eligible for an Annual or Quarterly Incentive Awards (as
applicable), which shall be comprised of the following components:
1. Business Metrics
2. Safety and Soundness, Compliance, Internal Audit and Internal
Controls (Wrap)
3. Subjective Assessment (Wrap)
These components shall be measured as follows: Measurement of Components
Intentionally Omitted.
Note: Appendix A from March 2002, indicating base salary of $544,500, will be in
effect until December 2002, and the target annual bonus of $200,000 indicated on
such Appendix A will be in effect for the full year of 2002.
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Appendix B
A "Change in Control" shall mean the occurrence during the term of the
Agreement, of any one of the following events:
A. An acquisition of any common stock or other "Voting Securities" (as
hereinafter defined) of IndyMac Bancorp, Inc. ("Employer") by any "Person" (as
the term person is used for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")), immediately after which
such Person has "Beneficial Ownership" (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of twenty five percent (25%) or more of the
then outstanding shares of Employer's common stock or the combined voting power
of Employer's then outstanding Voting Securities; provided, however, in
determining whether a Change in Control has occurred, Voting Securities which
are acquired in a "Non-Control Acquisition" (as hereinafter defined) shall not
constitute an acquisition which would cause a Change in Control. For purposes of
this Agreement, (1) "Voting Securities" shall mean Employer's outstanding voting
securities entitled to vote generally in the election of directors and (2) a
"Non-Control Acquisition" shall mean an acquisition by (i) an employee benefit
plan (or a trust forming a part thereof) maintained by (A) Employer or (B) any
corporation or other Person of which a majority of its voting power or its
voting equity securities or equity interest is owned, directly or indirectly, by
Employer (for purposes of this definition; a "Subsidiary"), (ii) Employer or any
of its Subsidiaries, or (iii) any Person in connection with a "Non-Control
Transaction" (as hereinafter defined).
B. The individuals who, as of the date of the Agreement are members of the
Board (the "Incumbent Board"), cease for any reason to constitute at least a
majority of the members of the Board; provided, however, that if the election,
or nomination for election by Employer's common stockholders, of any new
director was approved by a vote of at least two-thirds of the Incumbent Board,
such new director shall, for purposes of this Agreement, be considered as a
member of the Incumbent Board; provided further, however, that no individual
shall be considered a member of the Incumbent Board if such individual initially
assumed office as a result of either an actual or threatened "Election Contest"
(as described in Rule 14a-11 promulgated under the Exchange Act) or other actual
or threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board (a "Proxy Contest") including by reason of any agreement
intended to avoid or settle any Election Contest or Proxy Contest; or
C. The consummation of:
(i) A merger, consolidation, or reorganization involving Employer, unless
such merger, consolidation, or reorganization is a "Non-Control
Transaction." A "Non Control Transaction" shall mean a merger,
consolidation or reorganization of Employer where:
a. the stockholders of Employer, immediately before such
merger, consolidation or reorganization, own directly or indirectly
immediately following such merger, consolidation or reorganization more
than fifty percent (50%) of the combined voting power of the outstanding
Voting Securities of
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the corporation resulting from such merger, consolidation or
reorganization (the "Surviving Corporation") in substantially the same
proportion as their ownership of the Voting Securities immediately before
such merger, consolidation or reorganization; provided, however, that if
the stockholders of Parent, immediately before such merger, consolidation
or reorganization, own directly or indirectly immediately following such
merger, consolidation or reorganization forty-five percent to fifty
percent (45% to 50%) of the combined voting power of the outstanding
Voting Securities of the Surviving Corporation in substantially the same
proportion as their ownership of the Voting Securities immediately before
such merger, consolidation or reorganization, then a Change in Control
shall be deemed to have occurred unless the members of the Incumbent Board
who are not employees of Parent determine otherwise; and
b. no Person other than (i) Employer, (ii) any Subsidiary,
(iii) any employee benefit plan (or any trust forming a part thereat)
maintained by Employer, the Surviving Corporation or any Subsidiary, or
(iv) any Person who, immediately prior to such merger, consolidation or
reorganization had Beneficial Ownership of twenty-five percent (25%) or
more of the then outstanding Voting Securities or common stock of
Employer, has Beneficial Ownership of twenty-five percent (25%) or more of
the combined voting power of the Surviving Corporation's then outstanding
Voting Securities or its common stock;
(ii) Employer's stockholders approve a complete liquidation or dissolution
of Employer;
(iii) The sale or other disposition of all or substantially all of the
assets of Employer to any Person or Persons (other than a transfer to a
Subsidiary); or
(iv) The sale or other disposition of all or substantially all of the
stock or assets of IndyMac Bank, F.S.B. to any Person or Persons (other
than a transfer to a Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because any Person (the "Subject Person") acquired Beneficial Ownership
of more than the permitted amount of the then outstanding common stock or Voting
Securities as a result of the acquisition of common stock or Voting Securities
by Employer which, by reducing the number of shares of common stock or Voting
Securities then outstanding, increases the proportional number of shares
Beneficially Owned by the Subject Person; provided, however, that if a Change of
Control would occur (but for the operation of this sentence) as a result of the
acquisition of common stock or Voting Securities by Employer, and after such
share acquisition by Employer, the Subject Person becomes the Beneficial Owner
of any additional common stock or Voting Securities which increases the
percentage of the then outstanding common stock or Voting Securities
Beneficially Owned by the Subject Person, then a Change in Control shall occur.
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