UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): August 27, 2007
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FIRSTPLUS FINANCIAL GROUP, INC.
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(Exact Name of Registrant as specified in Charter)
Nevada 0-27750 75-2561085
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(State or Other (Commission (IRS Employer
Jurisdiction of Incorporation) File Number) Identification No.)
122 W. John Carpenter Freeway, Suite 450, Irving, Texas 75039
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (972) 717-7969
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(Former Name or Former Address, if Changed Since Last Report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (SEE General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On August 27, 2007, FIRSTPLUS Financial Group, Inc. (the "Company")
entered into an indemnification agreement with each of its directors and
executive officers (collectively, the "Indemnification Agreements") whereby the
Corporation is to indemnify each such person from and against any and all
judgments, fines, penalties, excise taxes and amounts paid in settlement or
incurred by such person for or as a result of action taken or not taken while
such director was acting in his capacity as a director or executive officer of
the Corporation.
The foregoing description of the Indemnification Agreements is not
complete and is qualified in its entirety by reference to the full text of the
Indemnification Agreements. A "form of" the Indemnification Agreements is
attached hereto as Exhibit 10.1.
ITEM 5.02. DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF
DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY
ARRANGEMENTS OF CERTAIN OFFICERS.
The Company regrets to announce the passing of the Chairman of its Board
of Directors, Harold Garber. On behalf of the directors, officers and employees
of the Company, the Company would like to thank Mr. Garber for his service to
the Company.
In order to fill the vacancy on the Board of Directors left by the passing
of Mr. Garber, on August 27, 2007, Roger S. Meek was elected to the Board of
Directors and Robert O'Neal was elected Chairman of the Board of Directors.
On August 27, 2007, the Board of Directors appointed Messrs. Meek
(Chairman) and O'Neal to its newly formed Audit Committee and appointed Messrs.
Meek (Chairman) and O'Neal to its newly formed Compensation Committee.
On August 27, 2007, the Company entered into an employment agreement with
John Maxwell, the Company's Chief Executive Officer and President. The
agreement, effective as of July 1, 2007, provides for an initial term ending on
June 30, 2009 and is automatically renewed for additional one-year terms unless
either party provides the other party with advance notice of its intent not to
renew. Mr. Maxwell is to receive a base salary at the annual rate of $200,000
and such incentive compensation and bonuses, if any, (i) as the Board of
Directors in its absolute discretion may determine, and (ii) to which the Mr.
Maxwell may become entitled pursuant to the terms of any incentive compensation
or bonus program, plan or agreement from time to time in effect in which he is a
participant.
On August 27, 2007, the Company entered into an employment agreement with
William Handley, the Company's Chief Financial Officer, Vice President and
Treasurer. The agreement is substantially identical to Mr. Maxwell's agreement
except that it provides for a base salary at the annual rate of $145,000.
The foregoing descriptions of these agreements are not complete and are
qualified in their entirety by reference to the full text of the agreements,
copies of which are filed herewith as Exhibits 10.2 and 10.3, respectively, and
are incorporated herein by reference.
ITEM 8.01. OTHER EVENTS.
On August 27, 2007, the Company adopted an insider trading policy, a copy
of which is attached hereto as Exhibit 99.1.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits
Exhibit No. Exhibits
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10.1 FIRSTPLUS Financial Group, Inc. Form of Director and
Officer Indemnification Agreement.
10.2 Employment Agreement dated August 27, 2007, by and
between FIRSTPLUS Financial Group, Inc. and John
Maxwell.
10.3 Employment Agreement dated August 27, 2007, by and
between FIRSTPLUS Financial Group, Inc. and William
Handley.
99.1 FIRSTPLUS Financial Group, Inc. Insider Trading
Policy.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this Current Report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
August 30, 2007
FIRSTPLUS FINANCIAL GROUP, INC.
By: /s/ John Maxwell
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Name: John Maxwell
Title: President and Chief Executive Officer
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Exhibit 10.1
FIRSTPLUS Financial Group, Inc.
122 W. John Carpenter Freeway, Suite 450
Irving, Texas 75039
August __, 2007
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c/o FIRSTPLUS Financial Group, Inc.
122 W. John Carpenter Freeway, Suite 450
Irving, Texas 75039
Dear ____________:
In consideration of your service as a director and/or officer of FIRSTPLUS
Financial Group, Inc., a Nevada corporation (the "Company"), the Company will,
to the extent provided herein, indemnify you and hold you harmless from and
against any and all "Losses" (as defined below), that you may incur in
connection with any "Proceeding" (as defined below) to the fullest extent
permitted by law.
1. DEFINITIONS.
(a) "Costs and Expenses" means, for the purposes of this Agreement,
all direct and indirect costs of any type or nature whatsoever (including,
without limitation, any fees and disbursements of your counsel, accountants and
other experts and other out-of-pocket costs) actually and reasonably incurred by
you in connection with the investigation, preparation, defense or appeal of a
Proceeding.
(b) "Losses" means all liabilities, Costs and Expenses, amounts of
judgments, fines, penalties or excise taxes (or other amounts assessed,
surcharged or levied under the Employee Retirement Income Security Act of 1974,
as amended) and amounts paid in settlement of or incurred in defense of or
otherwise in connection with any threatened, pending or completed Proceeding,
whether civil, criminal, administrative or investigative, and whether brought by
or in the right of the Company or otherwise, and appeals in which you may become
involved, as a party or otherwise, by reason of acts or omissions in your
capacity as and while serving as a director, officer, employee, agent, fiduciary
or representative of the Company or any Related Entity.
(c) "Proceeding" means, for the purposes of this Agreement, any
threatened, pending or completed action or proceeding, whether civil, criminal,
administrative or investigative (including an action brought by or in the right
of the Company) in which you may be or may have been involved as a party or
otherwise, by reason of the fact that you are or were a director or officer of
the Company, by reason of any action taken by you or of any inaction on your
part while acting as such director or officer or by reason of the fact that you
are or were serving at the request of the Company as a director, officer,
employee, agent, fiduciary or representative of a Related Entity whether or not
you were serving in such capacity at the time any liability or expense is
incurred for which indemnification or reimbursement can be provided under this
Agreement.
(d) "Related Entity" means any corporation, partnership, joint
venture, trust or other entity or enterprise in which the Company is in any way
interested, or in or as to which you are serving at the Company's request or on
its behalf, as a director, officer, employee, agent, fiduciary or representative
including, but not limited to, any employee benefit plan or any corporation of
which the Company or any Related Entity is, directly or indirectly, a
stockholder or creditor.
2. AGREEMENT TO SERVE.
You agree to serve or continue to serve as a director and/or officer of
the Company to the best of your abilities at the will of the Company or under
separate contract, if such contract exists, for so long as you are duly elected
or appointed and qualified or until such time as you tender your resignation in
writing. Nothing contained in this Agreement is intended to create in you any
right to continued employment.
3. INDEMNIFICATION.
(a) THIRD PARTY PROCEEDINGS. To the fullest extent permitted by law,
the Company shall indemnify you against Losses actually and reasonably incurred
by you in connection with a Proceeding (other than a Proceeding by or in the
right of the Company) if (i) you are not liable pursuant to NRS 78.138 or (ii)
you acted in good faith and in a manner you reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
Proceeding, had no reasonable cause to believe your conduct was unlawful. The
termination of any Proceeding by judgment, order, settlement, conviction, or
upon a plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a
presumption that you are liable pursuant to NRS 78.138 or did not act in good
faith and in a manner that you reasonably believed to be in or not opposed to
the best interests of the Company, or, with respect to any criminal Proceeding,
had reasonable cause to believe that your conduct was unlawful.
(b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. To the fullest
extent permitted by law, the Company shall indemnify you against Losses,
actually and reasonably incurred by you in connection with a Proceeding by or in
the right of the Company to procure a judgment in its favor if (i) you are not
liable pursuant to NRS 78.138 or (ii) you acted in good faith and in a manner
you reasonably believed to be in or not opposed to the best interests of the
Company and its shareholders. Notwithstanding the foregoing, no indemnification
shall be made in respect of any claim, issue or matter as to which you shall
have been adjudged by a court of competent jurisdiction, after exhaustion of all
appeals therefrom, to be liable to the Company in the performance of your duty
to the Company and its shareholders unless and only to the extent that the court
in which such action or proceeding is or was pending shall determine upon
application that, in view of all the circumstances of the case, you are fairly
and reasonably entitled to indemnity for Costs and Expenses and then only to the
extent that the court shall determine.
(c) SCOPE. Notwithstanding any other provision of this Agreement but
subject to Section 15(b), the Company shall indemnify you to the fullest extent
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permitted by law, notwithstanding that such indemnification is not specifically
authorized by other provisions of this Agreement, the Company's Articles of
Incorporation, as amended, the Company's Bylaws, as amended, or by statute.
4. LIMITATIONS ON INDEMNIFICATION.
Any other provision herein to the contrary notwithstanding, the Company
shall not be obligated pursuant to the terms of this Agreement:
(a) EXCLUDED ACTS. To indemnify you for any acts or omissions or
transactions from which a director or officer may not be relieved of liability
under applicable law;
(b) EXCLUDED INDEMNIFICATION PAYMENTS. To indemnify or advance Costs
and Expenses in violation of any prohibition or limitation on indemnification
under the statutes, regulations or rules promulgated by any state or federal
regulatory agency having jurisdiction over the Company or in circumstances that
would otherwise be contrary to public policy;
(c) CLAIMS INITIATED BY YOU. To indemnify or advance Costs and
Expenses to you with respect to Proceedings or claims initiated or brought
voluntarily by you and not by way of defense, except with respect to proceedings
brought to establish or enforce a right to indemnification under this Agreement
or any other statute or law or otherwise as required under Section 78.7502 of
the Nevada Revised Statutes, but such indemnification or advancement of Costs
and Expenses may be provided by the Company in specific cases if the Board of
Directors has approved the initiation or bringing of such suit;
(d) LACK OF GOOD FAITH. To indemnify you for any Costs and Expenses
incurred by you with respect to any proceeding instituted by you to enforce or
interpret this Agreement, if a court of competent jurisdiction determines that
each of the material assertions made by you in such proceeding was not made in
good faith;
(e) INSURED CLAIMS. To indemnify you for Costs and Expenses or
liabilities of any type whatsoever (including, but not limited to, judgments,
fines, ERISA excise taxes or penalties, and amounts paid in settlement) that
have been paid directly to or on behalf of you by an insurance carrier under a
policy of directors' and officers' liability insurance maintained by the Company
or any other policy of insurance maintained by the Company or you;
(f) CLAIMS UNDER SECTION 16(B). To indemnify you for Costs and
Expenses and the payment of profits arising from the purchase and sale by you of
securities in violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended, or any similar successor statute.
(g) MUTUAL ACKNOWLEDGMENT. Both the Company and you acknowledge that
in certain instances, federal law or applicable public policy may prohibit the
Company from indemnifying its directors and officers under this Agreement or
otherwise. You understand and acknowledge that the Company has undertaken or may
be required in the future to undertake with the appropriate state or federal
regulatory agency to submit for approval any request for indemnification, and
has undertaken or may be required in the future to undertake with the Securities
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and Exchange Commission to submit the question of indemnification to a court in
certain circumstances for a determination of the Company's right under public
policy to indemnify you.
5. DETERMINATION OF A RIGHT TO INDEMNIFICATION.
Upon receipt of a written claim addressed to the Board of Directors for
indemnification pursuant to Section 3, the Company shall determine by any of the
methods set forth in Section 78.751 of the Nevada Revised Statutes whether you
have met the applicable standards of conduct that makes it permissible under
applicable law to indemnify you. If a claim under Section 3 is not paid in full
by the Company within 60 days after such written claim has been received by the
Company, you may at any time thereafter bring suit against the Company to
recover the unpaid amount of the claim and, unless such action is brought in bad
faith, you shall be entitled to be paid also the expense of prosecuting such
claim. In any such action, except as otherwise provided in Section 78.7502 of
the Nevada Revised Statutes, the Company shall have the burden of proof
concerning whether you have or have not met the applicable standard of conduct.
6. INDEMNIFICATION FOR COSTS AND EXPENSES OF A WITNESS.
Notwithstanding any other provision of this Agreement, to the extent that
you are, by reason of your position as director or officer of the Company, a
witness in any Proceeding to which you are not a party, you shall be indemnified
against all Costs and Expenses actually and reasonably incurred by you or on
your behalf in connection therewith.
7. ADVANCEMENT AND REPAYMENT OF COSTS AND EXPENSES.
Subject to Section 4 hereof, the Costs and Expenses incurred by you in
defending and investigating any Proceeding shall be paid by the Company in
advance of the final disposition of such Proceeding within 30 days after
receiving from you the copies of invoices presented to you for such Costs and
Expenses, if you shall provide an undertaking to the Company to repay such
amount to the extent it is ultimately determined that you are not entitled to
indemnification. In determining whether or not to make an advance hereunder,
your ability to repay shall not be a factor.
8. PARTIAL INDEMNIFICATION.
If you are entitled under any provision of this Agreement to
indemnification or advancement by the Company of some or a portion of any Losses
of any type whatsoever (including, but not limited to, judgments, fines,
penalties, and amounts paid in settlement) incurred by you in the investigation,
defense, settlement or appeal of a Proceeding, but are not entitled to
indemnification or advancement of the total amount thereof, the Company shall
nevertheless indemnify or pay advancements to you for the portion of such Losses
or liabilities to which you are entitled.
9. NOTICE TO COMPANY BY YOU.
You shall notify the Company in writing of any matter with respect to
which you intend to seek indemnification hereunder as soon as reasonably
practicable following the receipt by you of written notice thereof; provided,
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however, that any delay in so notifying the Company shall not constitute a
waiver by you of your rights hereunder. The written notification to the Company
shall be addressed to the Board of Directors and shall include a description of
the nature of the Proceeding and the facts underlying the Proceeding and be
accompanied by copies of any documents filed with the court in which the
Proceeding is pending. In addition, you shall give the Company such information
and cooperation as it may reasonably require and as shall be within your power.
10. MAINTENANCE OF LIABILITY INSURANCE.
(a) Subject to Section 4 hereof, so long as you shall continue to
serve as a director or officer of the Company and thereafter so long as you
shall be subject to any possible Proceeding, the Company, subject to Section
10(b), shall use reasonable commercial efforts to obtain and maintain in full
force and effect directors' and officers' liability insurance ("D&O Insurance")
that provides you the same rights and benefits as are accorded the most
favorably insured of the Company's directors, if you are a director, or of the
Company's officers, if you are not a director of the Company, but are an
officer.
(b) Notwithstanding the foregoing, the Company shall have no
obligation to obtain or maintain D&O Insurance if the Company determines in good
faith that such insurance is not reasonably available, the premium costs for
such insurance are disproportionate to the amount of coverage provided, the
coverage provided by such insurance is limited by exclusions so as to provide an
insufficient benefit, or you are covered by similar insurance maintained by a
subsidiary or parent of the Company.
(c) If, at the time of the receipt of a notice of a claim pursuant
to Section 9 hereof, the Company has D&O Insurance in effect, the Company shall
give prompt notice of the commencement of such Proceeding to the insurers in
accordance with the procedures set forth in the respective policies. The Company
shall thereafter take all necessary or desirable action to cause such insurers
to pay, on your behalf, all amounts payable as a result of such Proceeding in
accordance with the terms of such policies.
11. DEFENSE OF CLAIM.
In the event that the Company shall be obligated under Section 7 hereof to
pay the Costs and Expenses of any Proceeding against you, the Company, if
appropriate, shall be entitled to assume the defense of such Proceeding, with
counsel of recognized standing. After the retention of such counsel by the
Company, the Company will not be liable to you under this Agreement for any fees
of counsel subsequently incurred by you with respect to the same Proceeding,
provided that (i) you shall have the right to employ your counsel in any such
Proceeding at your expense; and (ii) if (A) the employment of counsel by you has
been previously authorized by the Company, or (B) you shall have reasonably
concluded that there may be a conflict of interest between the Company and you
in the conduct of such defense or (C) the Company shall not, in fact, have
employed counsel to assume the defense of such Proceeding, then the fees and
Costs and Expenses of your counsel shall be at the expense of the Company.
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12. ATTORNEYS' FEES.
In the event that you or the Company institutes an action to enforce or
interpret any terms of this Agreement, the Company shall reimburse you for all
of your reasonable fees and Costs and Expenses in bringing and pursuing such
action or defense, unless as part of such action or defense, a court of
competent jurisdiction determines that the material assertions made by you as a
basis for such action or defense were not made in good faith.
13. CONTINUATION OF OBLIGATIONS.
All agreements and obligations of the Company contained herein shall
continue during the period you are a director or officer of the Company, or are
or were serving at the request of the Company as a director, officer, employee,
agent, fiduciary or representative of a Related Entity and shall continue
thereafter so long as you shall be subject to any possible Proceeding by reason
of the fact that you served in any capacity referred to herein.
14. SUCCESSORS AND ASSIGNS.
This Agreement establishes contract rights that shall be binding upon, and
shall inure to the benefit of, the successors, assigns, heirs and legal
representatives of the parties hereto.
15. NON-EXCLUSIVITY.
(a) The provisions for indemnification and advancement of Costs and
Expenses set forth in this Agreement shall not be deemed to be exclusive of any
other rights that you may have under any provision of law, the Company's
Articles of Incorporation, as amended, or Bylaws, as amended, the vote of the
Company's shareholders or disinterested directors, other agreements or
otherwise, both as to action in your official capacity and action in another
capacity while occupying your position as a director or officer of the Company.
(b) In the event of any changes, after the date of this Agreement,
in any applicable law, statute, or rule that expand the right of a Nevada
corporation to indemnify its officers and directors, your rights and the
Company's obligations under this Agreement shall be expanded to the full extent
permitted by such changes. In the event of any changes in any applicable law,
statute or rule that narrow the right of a Nevada corporation to indemnify a
director or officer, such changes, to the extent not otherwise required by such
law, statute or rule to be applied to this Agreement, shall have no effect on
this Agreement or the parties' rights and obligations hereunder.
16. EFFECTIVENESS OF AGREEMENT.
This Agreement shall be effective as of the date set forth on the first
page hereof and shall apply to your acts or omissions that occurred prior to
such date if you were an officer, director, employee or other agent of the
Company, or were serving at the request of the Company as a director, officer,
employee, agent, fiduciary or representative of a Related Entity at the time
such act or omission occurred.
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17. SEVERABILITY.
Nothing in this Agreement is intended to require or shall be construed as
requiring the Company to do or fail to do any act in violation of applicable
law. The Company's inability, pursuant to court order, to perform its
obligations under this Agreement shall not constitute a breach of this
Agreement. The provisions of this Agreement shall be severable as provided in
this Section 17. If this Agreement or any portion hereof shall be invalidated on
any ground by any court of competent jurisdiction, then the Company shall
nevertheless indemnify you to the full extent permitted by any applicable
portion of this Agreement that shall not have been invalidated, and the balance
of this Agreement not so invalidated shall be enforceable in accordance with its
terms.
18. GOVERNING LAW.
This Agreement shall be interpreted and enforced in accordance with the
laws of the State of Nevada, without reference to its conflict of law rules. To
the extent permitted by applicable law, the parties hereby waive any provisions
of law that render any provision of this Agreement unenforceable in any respect.
19. NOTICE.
All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed duly given (i) when received,
if delivered by hand (which shall include delivery by responsible overnight
carrier) or (ii) if mailed by certified or registered mail with postage prepaid,
on the fifth business day after the mailing date. Addresses for notice to either
party are as shown at the head of this Agreement, or as subsequently modified by
written notice given as provided hereunder.
20. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which
shall constitute an original.
21. AMENDMENT AND TERMINATION.
No amendment, modification, termination or cancellation of this Agreement
shall be effective unless in writing signed by both parties hereto.
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Your signature below will evidence your agreement and acceptance with
respect to the foregoing.
Very truly yours,
FIRSTPLUS FINANCIAL GROUP, INC.
By:
-----------------------------------
Name:
Title:
AGREED TO AND ACCEPTED:
----------------------------------------
Name:
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Exhibit 10.2
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated August 27, 2007, effective as of July 1,
2007, by and between FIRSTPLUS FINANCIAL GROUP, INC., a Nevada corporation with
its principal office at 122 W. John Carpenter Freeway, Suite 450, Irving, Texas
75039 (the "Company"), and JOHN MAXWELL, residing at 330 East Las Colinas
Boulevard, #444, Irving, Texas 75039 (the "Employee").
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Employee for the period
provided in this Agreement and the Employee is willing to accept such employment
with the Company on a full-time basis, all in accordance with the terms and
conditions set forth below.
NOW, THEREFORE, for and in consideration of the premises hereof and
the mutual covenants contained herein, the parties hereto covenant and agree as
follows:
1. EMPLOYMENT.
(a) The Company hereby employs the Employee, and the Employee
hereby accepts such employment with the Company, for the period set forth in
Section 2 hereof, all upon the terms and conditions hereinafter set forth.
(b) The Employee affirms and represents that he is under no
obligation to any former employer or other party that is in any way inconsistent
with, or that imposes any restriction upon, the Employee's acceptance of
employment hereunder with the Company, the employment of the Employee by the
Company, or the Employee's undertakings under this Agreement.
2. TERM OF EMPLOYMENT.
(a) Unless earlier terminated as provided in this Agreement,
the term of the Employee's employment under this Agreement shall be for a period
beginning on the effective date hereof and ending on June 30, 2009 (the "Initial
Term").
(b) The term of the Employee's employment under this Agreement
shall be automatically renewed for additional one-year terms (each a "Renewal
Term") upon the expiration of the Initial Term or any Renewal Term unless the
Company or the Employee delivers to the other, at least 90 days prior to the
expiration of the Initial Term or the then current Renewal Term, as the case may
be, a written notice specifying that the term of the Employee's employment will
not be renewed at the end of the Initial Term or such Renewal Term, as the case
may be. The period from the date hereof until June 30, 2009 or, in the event
that the Employee's employment hereunder is earlier terminated as provided
herein or renewed as provided in this Section 2(b), such shorter or longer
period, as the case may be, is hereinafter called the "Employment Term."
3. DUTIES. The Employee shall be employed as Chief Executive
Officer and President of the Company and shall faithfully and competently
perform such duties consistent with such position as the Board of Directors of
the Company shall from time to time determine. The Employee shall perform his
duties principally at the offices of the Company in Irving, Texas, with such
travel to such other locations from time to time as the Board of Directors may
reasonably prescribe. Except as may otherwise be approved in advance by the
Board of Directors of the Company, and except during vacation periods and
reasonable periods of absence due to sickness, personal injury or other
disability or non-profit public service activities, the Employee shall devote
his full time throughout the Employment Term to the services required of him
hereunder. The Employee shall render his business services exclusively to the
Company and its present and future subsidiaries (collectively, the "FIRSTPLUS
Companies") during the Employment Term and shall use his best efforts, judgment
and energy to improve and advance the business and interests of the FIRSTPLUS
Companies in a manner consistent with the duties of his position.
4. COMPENSATION. As compensation for the complete and
satisfactory performance by the Employee of the services to be performed by him
hereunder during the Employment Term,
(a) the Company shall pay the Employee a base salary at the
annual rate of $200,000 (such amount, together with any increases thereto as may
be determined from time to time by the Board of Directors of the Company in its
discretion but subject to the provisions of this Agreement, being hereinafter
referred to as "Salary"). Any Salary payable hereunder shall be paid at regular
intervals in accordance with the Company's payroll practices from time to time
in effect; and
(b) the Company shall pay to the Employee such incentive
compensation and bonuses, if any, (i) as the Board of Directors in its absolute
discretion may determine to award the Employee, and (ii) to which the Employee
may become entitled pursuant to the terms of any incentive compensation or bonus
program, plan or agreement from time to time in effect and applicable to the
Employee.
5. OTHER BENEFITS. During the Employment Term, the Employee
shall:
(a) be eligible to participate in any medical and health plans
or other employee welfare benefit plans that may be provided by the Company for
its senior executive employees in accordance with the provisions of any such
plans, as the same may be in effect from time to time;
(b) be entitled to accrue three weeks' paid time off in
respect of each 12-month period during the term of his employment hereunder. The
Employee shall accrue paid time off at a rate of 1.25 days per month. The
Employee shall also be entitled to all paid holidays given by the Company to its
senior executive employees;
(c) be eligible for consideration by the Board of Directors of
the Company for awards of stock options under any stock option plan that may be
maintained by the Company for its and its subsidiaries' key employees, the
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amount of shares with respect to which options may be granted to the Employee to
be in the sole discretion of the Board of Directors of the Company or the
Compensation Committee thereof;
(d) be entitled to sick leave, sick pay and disability
benefits in accordance with any Company policy that may be applicable to senior
executive employees from time to time in effect;
(e) be entitled to reimbursement for all reasonable and
necessary out-of-pocket business expenses, incurred by the Employee in the
performance of his duties hereunder in accordance with the Company's
reimbursement policy from time to time in effect;
(f) be entitled to receive an automobile allowance of $850 per
month;
(g) be entitled to reimbursement for the actual cost of the
Employee's cellular telephone usage upon the Employee's presentment of
appropriate documentation thereof; and
(h) be entitled to coverage under directors' and officers'
liability insurance policies, if any, from time to time maintained by the
Company for its directors and officers subject to the terms and conditions of
the Indemnification Agreement of even date herewith by and between the Company
and the Employee.
6. CONFIDENTIAL INFORMATION. The Employee and the Company, as
applicable, hereby covenant, agree and acknowledge as follows:
(a) The Company hereby agrees to immediately provide the
Employee with access to unpublished and otherwise confidential information
("Confidential Information") both of a technical and non-technical nature,
relating to the business of the Company and any of its parents, subsidiaries,
divisions or affiliates, its actual or anticipated business, research or
development, its technology or the implementation or exploitation thereof,
including without limitation information Employee and others have collected,
obtained or created, information pertaining to customers, accounts, vendors,
prices, costs, materials, processes, codes, material results, technology, system
designs, system specifications, materials of construction, trade secrets and
equipment designs, including information disclosed to the Company by others
under agreements to hold such information confidential. Employee agrees to
observe all Company policies and procedures concerning such Confidential
Information.
(b) The Employee shall not disclose, use or make known for his
or another's benefit any Confidential Information or use such Confidential
Information in any way, except as is in the best interests of the FIRSTPLUS
Companies in the performance of the Employee's duties under this Agreement. The
Employee may disclose Confidential Information when required by a third party
and applicable law or judicial process, but only after providing (i) immediate
notice to the Company at any third party's request for such information, which
notice shall include the Employee's intent with respect to such request, and
(ii) sufficient opportunity for the Company to challenge or limit the scope of
the disclosure on behalf of the FIRSTPLUS Companies, the Employee or both.
3
(c) Upon the request of the Company at any time, or upon
termination of his employment with the Company for any reason, the Employee
shall forthwith return to the Company all originals and copies of Confidential
Information in whatever form maintained (including, without limitation, computer
discs and other electronic media).
(d) The Employee will promptly disclose to the Company any
idea, invention, discovery, improvement, whether patentable or not, conceived or
made by the Employee alone or with others at any time during his employment. The
Employee agrees that the Company owns any idea, invention, discovery,
improvement, whether patentable or not, conceived or made by him alone or with
others at any time during his employment, and hereby assign and agree to assign
to the Company all rights the Employee has or may acquire therein and agrees to
execute any and all applications, assignments or other instruments relating
thereto which the Company deems necessary. These obligations shall continue
beyond the termination of the Employee's employment with respect to ideas,
inventions, discoveries and improvements and derivatives of such ideas,
inventions, discoveries and improvements, conceived or made during the
Employee's employment with the Company. The Employee understands that the
obligation to assign his inventions to the Company shall not apply to any
invention which is developed entirely on his own time without using any of the
Company's equipment, supplies, facilities, and/or Confidential Information
unless such invention (a) relates in any way to the business or to the current
or anticipated research or development of the Company, or (b) results in any way
from the Employee's work at the Company.
(e) The Employee will not assert any rights to any invention,
discovery, idea or improvement relating to the business of the Company or to his
duties hereunder as having been made or acquired by him prior to his work for
the Company, except for the matters, if any, described in Appendix A to this
Agreement.
(f) At the Company's request and expense, the Employee agrees
to assist in protecting the Company's right in any idea, discovery, invention,
improvement or copyright owned by him pursuant to 6(e) above, or to be assigned
to the Company pursuant to this Agreement. The Employee hereby appoints each
executive officer of the Company, acting severally, as his attorney-in-fact with
full power of substitution for him and in his name, place and stead, in any and
all capacities, to execute any and all documents or other instruments in his
name and to take such other actions as may be necessary or advisable to effect
any such assignment to the Company. The Employee further agrees, that without in
any way limiting the rights of the Company under this Agreement, that any work
created by the Employee in the course of his employment shall be considered a
"work made for hire" created for the benefit of the Company to the extent it
could be considered as such.
(g) If the Company does not wish to retain ownership of any
such idea, discovery, invention or improvement, or copyright, and the Employee
wishes to use or develop same for his own benefit, the Employee will obtain the
Company's written permission before doing so.
4
7. TERMINATION.
(a) The Employee's employment hereunder shall be terminated
upon the occurrence of any of the following:
(i) the death of the Employee;
(ii) the Employee's inability to perform his duties
on account of disability or incapacity for a period of 120 or more days, whether
or not consecutive, within any period of 12 consecutive months;
(iii) the Company giving written notice, at any time,
to the Employee that the Employee's employment is being terminated for
"cause" (as defined below); or
(iv) the Company giving written notice, at any time,
to the Employee that the Employee's employment is being terminated other than
pursuant to clause (i), (ii) or (iii) above.
The following actions, failures and events by or affecting the
Employee shall constitute "cause" for termination within the meaning of clause
(iii) above: (A) a conviction of the Employee of, or the entering of a plea of
NOLO CONTENDERE by the Employee with respect to, having committed a felony, (B)
use of controlled substances or alcohol in the workplace or outside of the
workplace in such a manner as impairs or prevents the performance of the
Employee's duties hereunder or endangers the Employee or any other employee of
the Company, (C) acts of dishonesty or moral turpitude by the Employee that are
detrimental to one or more of the FIRSTPLUS Companies, (D) acts or omissions by
the Employee that the Employee knew were likely to damage the business of one or
more of the FIRSTPLUS Companies, (E) willful and repeated failure of the
Employee to perform any material duties hereunder or gross negligence of the
Employee in the performance of such duties, or (F) failure by the Employee to
obey the reasonable and lawful orders and policies of the Board of Directors
that are consistent with the provisions of this Agreement (provided that, in the
case of a conviction described in clause (A) above, and in the case of clause
(B), (C), (D) or (E) above, the Employee shall have received written notice of
such proposed termination and a reasonable opportunity to discuss the matter
with the Board of Directors of the Company, followed by written notice that the
Board of Directors of the Company adheres to its position.
(b) Notwithstanding anything to the contrary expressed or
implied herein, except as required by applicable law, the FIRSTPLUS Companies
shall not be obligated to make any payments to the Employee or on his behalf of
whatever kind or nature by reason of the termination of the Employment Term (i)
by the Employee (except in the case of the breach of this Agreement by the
Company) or (ii) pursuant to clause (i), (ii) or (iii) of Section 7(a) above,
other than such amounts, if any, that may be then otherwise payable to the
Employee pursuant to the terms of the Company's benefits plans or pursuant to
Section 5(e) hereof.
(c) If the Company terminates Employee's employment hereunder
pursuant to clause (iv) of Section 7(a), whether during the Initial Term or
during any Renewal Term, subject to and in exchange for the execution by the
Employee of a release absolving the Company of any further liability to the
Employee hereunder, the Company shall pay to the Employee in six equal monthly
5
installments, on the date in each month corresponding with the date of
termination, commencing with the month following termination and continuing for
five additional consecutive months thereafter, as severance pay, an amount equal
to one twelfth (1/12th) of the sum of (x) the Employee's annual Salary in effect
immediately prior to such termination, and (y) the amount of incentive
compensation and bonuses, if any, paid to the Employee in respect of the most
recent fiscal year of the Company preceding such termination. In any such event,
the Company, at its own expense, shall provide the Employee with six months of
continuation of medical and health benefits pursuant to COBRA (subject to the
Employee's eligibility and timely election of such benefits). The provisions of
this Section 7(c) shall not be applicable to the termination of the Employee's
employment at the end of the Initial Term or any Renewal Term.
(d) In the event of the death of the Employee at any time when
he is entitled to receive payments under Sections 7(c) hereof, such payments
shall be made to the estate of the Employee or if the Employee has designated a
beneficiary to receive such payments under Section 7 hereof, to such
beneficiary.
(e) No interest shall accrue on or be paid with respect to any
portion of any payments hereunder.
(f) Employee shall have no duty to mitigate any damages that
he may incur by reason of termination of employment under the circumstances
described in Section 7(c) and shall be entitled to receive the amounts provided
in Section 7(c) regardless of any income that he may receive from other sources
following the date he becomes entitled to receive such amounts.
(g) Neither this Agreement nor any right or interest hereunder
shall be assignable by the Employee or his beneficiaries or legal
representatives without the Company's prior written consent; provided, however,
that nothing in this Section 7 shall preclude the Employee from designating a
beneficiary to receive any benefit payable hereunder upon his death or
incapacity.
(h) Except as required by law, no right to receive payments
under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion,
attachment, levy or similar process or to assignment by operation of law, and
any attempt, voluntary or involuntary, to effect any such action shall be null,
void and of no effect.
8. RESTRICTIVE COVENANTS.
(a) During the Employment Term and, in the event that the
Employee's employment is terminated for any reason (including the non-renewal of
this Agreement in accordance with Section 2(b) above), during the 18-month
period following such termination, the Employee will not directly or indirectly
(as a director, officer, executive employee, manager, consultant, independent
contractor, advisor or otherwise) engage in competition with, or own any
interest in, perform any services for, participate in or be connected with any
business or organization that engages in competition with any of the FIRSTPLUS
6
Companies within the meaning of Section 8(d), provided, however, that the
provisions of this Section 8(a) shall not be deemed to prohibit the Employee's
ownership of not more than 2% of the total shares of all classes of stock
outstanding of any publicly held company.
(b) In the event that the Employee's employment is terminated
for any reason (including the non-renewal of this Agreement in accordance with
Section 2(b) above), during the 18-month period following such termination, the
Employee will not directly or indirectly hire, solicit, retain, compensate or
otherwise induce or attempt to induce any person who is and/or was an employee
of any of the FIRSTPLUS Companies at any time during the six months prior to the
Employee's termination, to leave the employ of the FIRSTPLUS Companies, or in
any way interfere with the relationship between any of the FIRSTPLUS Companies
and any employee thereof.
(c) During the Employment Term and, in the event that the
Employee's employment is terminated for any reason (including the non-renewal of
this Agreement in accordance with Section 2(b) above), during the 18-month
period following such termination, the Employee will not directly or indirectly
hire, engage, send any work to, place orders with, or in any manner be
associated with any supplier, contractor, subcontractor or other business
relation of any of the FIRSTPLUS Companies if such action by the Employee would
have a material adverse effect on the business, assets or financial condition of
any of the FIRSTPLUS Companies, or materially interfere with the relationship
between any such person or entity and any of the FIRSTPLUS Companies.
(d) For all purposes in this Section 8, a person or entity
(including without limitation, the Employee) shall be deemed to be a competitor
of or engaging in competition with one or more of the FIRSTPLUS Companies, if
such person or entity engages in any business competing with, or substantially
similar to, the businesses of one or more of the FIRSTPLUS Companies, as such
businesses exist at the time of termination of the Employee's employment with
the Company in any state of the United States of America in which any of the
FIRSTPLUS Companies conduct, or are actively investigating the possibility of
conducting, their businesses at the time of such termination. The provisions of
this Section 8 shall cease to be applicable to any state in which the FIRSTPLUS
Companies are actively investigating the possibility of conducting their
businesses at the time of termination of Employee's employment with the Company,
unless within three months after such termination, the FIRSTPLUS Companies, or
any of them, have commenced soliciting prospective customers in such state, and
have effectuated either of the following: (i) the opening of an office in such
state; or (ii) the hiring of one or more employees to be employed in such state
or the assignment of one or more incumbent employees to solicit business in such
state.
(e) In connection with the foregoing provisions of this
Section 8, the Employee represents that his experience, capabilities and
circumstances are such that such provisions will not prevent him from earning a
livelihood. The Employee further agrees that the limitations set forth in this
Section 8 (including, without limitation, time limitations) are reasonable and
properly required for the adequate protection of the current and future
businesses of the FIRSTPLUS Companies. It is understood that the covenants made
by the Employee in this Section 8 (and in Section 6 hereof) shall survive the
expiration or termination of this Agreement.
7
9. LEGITIMATE BUSINESS INTERESTS OF THE FIRSTPLUS COMPANIES.
(a) The parties hereto acknowledge and agree that the matters
set forth above in Sections 6 and 8 constitute the legitimate business interests
of the FIRSTPLUS Companies and are hereby conclusively agreed to be legally
sufficient to support such covenants. Such legitimate business interests include
but are not necessarily limited to trade secrets; valuable confidential business
or professional information that does not legally qualify as trade secrets;
substantial relationships with specific prospective or existing customers or
clients; customer or client good will associated with an ongoing business in a
specific geographic location and a specific marketing area; and extraordinary or
specialized training. It is further acknowledged and agreed that all such
restrictive covenants set forth above are reasonably necessary to protect the
legitimate business interests of the FIRSTPLUS Companies and are not overbroad
or unreasonable. It is acknowledged and agreed that the Company is specifically
relying upon the foregoing statements in entering into this Agreement.
(b) The Employee acknowledges that a remedy at law for any
breach or threatened breach of the provisions of Sections 6 or 8 hereof would be
inadequate, that the FIRSTPLUS Companies would be irreparably injured by such
breach and that, therefore, the FIRSTPLUS Companies shall be entitled to
injunctive relief in addition to any other available rights and remedies in case
of any such breach or threatened breach.
10. BINDING EFFECT. Without limiting or diminishing the effect of
Section 7 hereof, this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective heirs, successors, legal
representatives and assigns.
11. NOTICES. All notices that are required or may be given
pursuant to the terms of this Agreement shall be in writing and shall be
sufficient in all respects if given in writing and (i) delivered personally,
(ii) mailed by certified or registered mail, return receipt requested and
postage prepaid, or (iii) sent via a responsible overnight courier, to the
parties at their respective addresses set forth above, or to such other address
or addresses as either party shall have designated in writing to the other party
hereto. The date of the giving of such notices delivered personally or by
carrier shall be the date of their delivery and the date of giving of such
notices by certified or registered mail shall be the date five days after the
posting of the mail.
12. LAW GOVERNING. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, except that body of
law relating to choice of laws.
13. SEVERABILITY. In the event that any court of competent
jurisdiction shall finally hold that any provision of Section 6 or 8 hereof is
void or constitutes an unreasonable restriction against the Employee, Section 6
or 8, as the case may be, shall not be rendered void, but shall apply with
respect to such extent as such court may judicially determine constitutes a
reasonable restriction under the circumstances, and, in such connection, the
parties hereto authorize any such court to modify or sever any such provision,
including without limitation, any such provision relating to duration and
geographical area, to the extent deemed necessary or appropriate by such court.
If any part of this Agreement other than Section 6 or 8 is held by a court of
competent jurisdiction to be invalid, illegal or incapable of being enforced in
whole or in part by reason of any rule of law or public policy, such part shall
8
be deemed to be severed from the remainder of this Agreement for the purpose
only of the particular legal proceedings in question and all other covenants and
provisions of this Agreement shall in every other respect continue in full force
and effect and no covenant or provision shall be deemed dependent upon any other
covenant or provision.
14. WAIVER. Failure to insist upon strict compliance with any of
the terms, covenants or conditions hereof shall not be deemed a waiver of such
term, covenant or condition, nor shall any waiver or relinquishment of any right
or power hereunder at any one or more times be deemed a waiver or relinquishment
of such right or power at any other time or times.
15. ENTIRE AGREEMENT; MODIFICATIONS. This Agreement constitutes
the entire agreement of the parties with respect to the subject matter hereof
and supersedes all prior agreements, oral and written, between the parties
hereto with respect to the subject matter hereof. This Agreement may be modified
or amended only by an instrument in writing signed by both parties hereto.
16. SURVIVAL OF PROVISIONS. Neither the termination of this
Agreement, nor of Executive's employment hereunder, shall terminate or affect in
any manner any provision of this Agreement that is intended by its terms to
survive such termination, including without limitation, the provisions of
Sections 4 to 8 inclusive and Section 11 hereof.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Employee have duly executed
and delivered this Agreement, as of the day and year first above written.
FIRSTPLUS FINANCIAL GROUP, INC.
By: /s/ William Handley
---------------------------------
Name: William Handley
Title: Chief Financial Officer
/s/ John Maxwell
-------------------------------------
JOHN MAXWELL
9
APPENDIX A
None
10
Exhibit 10.3
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated August 27, 2007, effective as of July 1,
2007, by and between FIRSTPLUS FINANCIAL GROUP, INC., a Nevada corporation with
its principal office at 122 W. John Carpenter Freeway, Suite 450, Irving, Texas
75039 (the "Company"), and WILLIAM HANDLEY, residing at 9911 S.W. 48th Street,
Miami, Florida 33139 (the "Employee").
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Employee for the period
provided in this Agreement and the Employee is willing to accept such employment
with the Company on a full-time basis, all in accordance with the terms and
conditions set forth below.
NOW, THEREFORE, for and in consideration of the premises hereof and
the mutual covenants contained herein, the parties hereto covenant and agree as
follows:
1. EMPLOYMENT.
(a) The Company hereby employs the Employee, and the Employee
hereby accepts such employment with the Company, for the period set forth in
Section 2 hereof, all upon the terms and conditions hereinafter set forth.
(b) The Employee affirms and represents that he is under no
obligation to any former employer or other party that is in any way inconsistent
with, or that imposes any restriction upon, the Employee's acceptance of
employment hereunder with the Company, the employment of the Employee by the
Company, or the Employee's undertakings under this Agreement.
2. TERM OF EMPLOYMENT.
(a) Unless earlier terminated as provided in this Agreement,
the term of the Employee's employment under this Agreement shall be for a period
beginning on the effective date hereof and ending on June 30, 2009 (the "Initial
Term").
(b) The term of the Employee's employment under this Agreement
shall be automatically renewed for additional one-year terms (each a "Renewal
Term") upon the expiration of the Initial Term or any Renewal Term unless the
Company or the Employee delivers to the other, at least 90 days prior to the
expiration of the Initial Term or the then current Renewal Term, as the case may
be, a written notice specifying that the term of the Employee's employment will
not be renewed at the end of the Initial Term or such Renewal Term, as the case
may be. The period from the date hereof until June 30, 2009 or, in the event
that the Employee's employment hereunder is earlier terminated as provided
herein or renewed as provided in this Section 2(b), such shorter or longer
period, as the case may be, is hereinafter called the "Employment Term."
3. DUTIES. The Employee shall be employed as Chief Financial
Officer, Vice President and Treasurer of the Company and shall faithfully and
competently perform such duties consistent with such position as the Board of
Directors of the Company shall from time to time determine. The Employee shall
perform his duties principally at the offices of the Company in Irving, Texas,
with such travel to such other locations from time to time as the Board of
Directors may reasonably prescribe. Except as may otherwise be approved in
advance by the Board of Directors of the Company, and except during vacation
periods and reasonable periods of absence due to sickness, personal injury or
other disability or non-profit public service activities, the Employee shall
devote his full time throughout the Employment Term to the services required of
him hereunder. The Employee shall render his business services exclusively to
the Company and its present and future subsidiaries (collectively, the
"FIRSTPLUS Companies") during the Employment Term and shall use his best
efforts, judgment and energy to improve and advance the business and interests
of the FIRSTPLUS Companies in a manner consistent with the duties of his
position.
4. COMPENSATION. As compensation for the complete and
satisfactory performance by the Employee of the services to be performed by him
hereunder during the Employment Term,
(a) the Company shall pay the Employee a base salary at the
annual rate of $145,000 (such amount, together with any increases thereto as may
be determined from time to time by the Board of Directors of the Company in its
discretion but subject to the provisions of this Agreement, being hereinafter
referred to as "Salary"). Any Salary payable hereunder shall be paid at regular
intervals in accordance with the Company's payroll practices from time to time
in effect; and
(b) the Company shall pay to the Employee such incentive
compensation and bonuses, if any, (i) as the Board of Directors in its absolute
discretion may determine to award the Employee, and (ii) to which the Employee
may become entitled pursuant to the terms of any incentive compensation or bonus
program, plan or agreement from time to time in effect and applicable to the
Employee.
5. OTHER BENEFITS. During the Employment Term, the Employee
shall:
(a) be eligible to participate in any medical and health plans
or other employee welfare benefit plans that may be provided by the Company for
its senior executive employees in accordance with the provisions of any such
plans, as the same may be in effect from time to time;
(b) be entitled to accrue three weeks' paid time off in
respect of each 12-month period during the term of his employment hereunder. The
Employee shall accrue paid time off at a rate of 1.25 days per month. The
Employee shall also be entitled to all paid holidays given by the Company to its
senior executive employees;
(c) be eligible for consideration by the Board of Directors of
the Company for awards of stock options under any stock option plan that may be
maintained by the Company for its and its subsidiaries' key employees, the
amount of shares with respect to which options may be granted to the Employee to
2
be in the sole discretion of the Board of Directors of the Company or the
Compensation Committee thereof;
(d) be entitled to sick leave, sick pay and disability
benefits in accordance with any Company policy that may be applicable to senior
executive employees from time to time in effect;
(e) be entitled to reimbursement for all reasonable and
necessary out-of-pocket business expenses, incurred by the Employee in the
performance of his duties hereunder in accordance with the Company's
reimbursement policy from time to time in effect;
(f) be entitled to receive an automobile allowance of $350 per
month;
(g) be entitled to reimbursement for the actual cost of the
Employee's cellular telephone usage upon the Employee's presentment of
appropriate documentation thereof; and
(h) be entitled to coverage under directors' and officers'
liability insurance policies, if any, from time to time maintained by the
Company for its directors and officers subject to the terms and conditions of
the Indemnification Agreement of even date herewith by and between the Company
and the Employee.
6. CONFIDENTIAL INFORMATION. The Employee and the Company, as
applicable, hereby covenant, agree and acknowledge as follows:
(a) The Company hereby agrees to immediately provide the
Employee with access to unpublished and otherwise confidential information
("Confidential Information") both of a technical and non-technical nature,
relating to the business of the Company and any of its parents, subsidiaries,
divisions or affiliates, its actual or anticipated business, research or
development, its technology or the implementation or exploitation thereof,
including without limitation information Employee and others have collected,
obtained or created, information pertaining to customers, accounts, vendors,
prices, costs, materials, processes, codes, material results, technology, system
designs, system specifications, materials of construction, trade secrets and
equipment designs, including information disclosed to the Company by others
under agreements to hold such information confidential. Employee agrees to
observe all Company policies and procedures concerning such Confidential
Information.
(b) The Employee shall not disclose, use or make known for his
or another's benefit any Confidential Information or use such Confidential
Information in any way, except as is in the best interests of the FIRSTPLUS
Companies in the performance of the Employee's duties under this Agreement. The
Employee may disclose Confidential Information when required by a third party
and applicable law or judicial process, but only after providing (i) immediate
notice to the Company at any third party's request for such information, which
notice shall include the Employee's intent with respect to such request, and
(ii) sufficient opportunity for the Company to challenge or limit the scope of
the disclosure on behalf of the FIRSTPLUS Companies, the Employee or both.
3
(c) Upon the request of the Company at any time, or upon
termination of his employment with the Company for any reason, the Employee
shall forthwith return to the Company all originals and copies of Confidential
Information in whatever form maintained (including, without limitation, computer
discs and other electronic media).
(d) The Employee will promptly disclose to the Company any
idea, invention, discovery, improvement, whether patentable or not, conceived or
made by the Employee alone or with others at any time during his employment. The
Employee agrees that the Company owns any idea, invention, discovery,
improvement, whether patentable or not, conceived or made by him alone or with
others at any time during his employment, and hereby assign and agree to assign
to the Company all rights the Employee has or may acquire therein and agrees to
execute any and all applications, assignments or other instruments relating
thereto which the Company deems necessary. These obligations shall continue
beyond the termination of the Employee's employment with respect to ideas,
inventions, discoveries and improvements and derivatives of such ideas,
inventions, discoveries and improvements, conceived or made during the
Employee's employment with the Company. The Employee understands that the
obligation to assign his inventions to the Company shall not apply to any
invention which is developed entirely on his own time without using any of the
Company's equipment, supplies, facilities, and/or Confidential Information
unless such invention (a) relates in any way to the business or to the current
or anticipated research or development of the Company, or (b) results in any way
from the Employee's work at the Company.
(e) The Employee will not assert any rights to any invention,
discovery, idea or improvement relating to the business of the Company or to his
duties hereunder as having been made or acquired by him prior to his work for
the Company, except for the matters, if any, described in Appendix A to this
Agreement.
(f) At the Company's request and expense, the Employee agrees
to assist in protecting the Company's right in any idea, discovery, invention,
improvement or copyright owned by him pursuant to 6(e) above, or to be assigned
to the Company pursuant to this Agreement. The Employee hereby appoints each
executive officer of the Company, acting severally, as his attorney-in-fact with
full power of substitution for him and in his name, place and stead, in any and
all capacities, to execute any and all documents or other instruments in his
name and to take such other actions as may be necessary or advisable to effect
any such assignment to the Company. The Employee further agrees, that without in
any way limiting the rights of the Company under this Agreement, that any work
created by the Employee in the course of his employment shall be considered a
"work made for hire" created for the benefit of the Company to the extent it
could be considered as such.
(g) If the Company does not wish to retain ownership of any
such idea, discovery, invention or improvement, or copyright, and the Employee
wishes to use or develop same for his own benefit, the Employee will obtain the
Company's written permission before doing so.
4
7. TERMINATION.
(a) The Employee's employment hereunder shall be terminated
upon the occurrence of any of the following:
(i) the death of the Employee;
(ii) the Employee's inability to perform his duties
on account of disability or incapacity for a period of 120 or more days, whether
or not consecutive, within any period of 12 consecutive months;
(iii) the Company giving written notice, at any time,
to the Employee that the Employee's employment is being terminated for
"cause" (as defined below); or
(iv) the Company giving written notice, at any time,
to the Employee that the Employee's employment is being terminated other than
pursuant to clause (i), (ii) or (iii) above.
The following actions, failures and events by or affecting the
Employee shall constitute "cause" for termination within the meaning of clause
(iii) above: (A) a conviction of the Employee of, or the entering of a plea of
NOLO CONTENDERE by the Employee with respect to, having committed a felony, (B)
use of controlled substances or alcohol in the workplace or outside of the
workplace in such a manner as impairs or prevents the performance of the
Employee's duties hereunder or endangers the Employee or any other employee of
the Company, (C) acts of dishonesty or moral turpitude by the Employee that are
detrimental to one or more of the FIRSTPLUS Companies, (D) acts or omissions by
the Employee that the Employee knew were likely to damage the business of one or
more of the FIRSTPLUS Companies, (E) willful and repeated failure of the
Employee to perform any material duties hereunder or gross negligence of the
Employee in the performance of such duties, or (F) failure by the Employee to
obey the reasonable and lawful orders and policies of the Board of Directors
that are consistent with the provisions of this Agreement (provided that, in the
case of a conviction described in clause (A) above, and in the case of clause
(B), (C), (D) or (E) above, the Employee shall have received written notice of
such proposed termination and a reasonable opportunity to discuss the matter
with the Board of Directors of the Company, followed by written notice that the
Board of Directors of the Company adheres to its position.
(b) Notwithstanding anything to the contrary expressed or
implied herein, except as required by applicable law, the FIRSTPLUS Companies
shall not be obligated to make any payments to the Employee or on his behalf of
whatever kind or nature by reason of the termination of the Employment Term (i)
by the Employee (except in the case of the breach of this Agreement by the
Company) or (ii) pursuant to clause (i), (ii) or (iii) of Section 7(a) above,
other than such amounts, if any, that may be then otherwise payable to the
Employee pursuant to the terms of the Company's benefits plans or pursuant to
Section 5(e) hereof.
(c) If the Company terminates Employee's employment hereunder
pursuant to clause (iv) of Section 7(a), whether during the Initial Term or
during any Renewal Term, subject to and in exchange for the execution by the
Employee of a release absolving the Company of any further liability to the
5
Employee hereunder, the Company shall pay to the Employee in six equal monthly
installments, on the date in each month corresponding with the date of
termination, commencing with the month following termination and continuing for
five additional consecutive months thereafter, as severance pay, an amount equal
to one twelfth (1/12th) of the sum of (x) the Employee's annual Salary in effect
immediately prior to such termination, and (y) the amount of incentive
compensation and bonuses, if any, paid to the Employee in respect of the most
recent fiscal year of the Company preceding such termination. In any such event,
the Company, at its own expense, shall provide the Employee with six months of
continuation of medical and health benefits pursuant to COBRA (subject to the
Employee's eligibility and timely election of such benefits). The provisions of
this Section 7(c) shall not be applicable to the termination of the Employee's
employment at the end of the Initial Term or any Renewal Term.
(d) In the event of the death of the Employee at any time when
he is entitled to receive payments under Sections 7(c) hereof, such payments
shall be made to the estate of the Employee or if the Employee has designated a
beneficiary to receive such payments under Section 7 hereof, to such
beneficiary.
(e) No interest shall accrue on or be paid with respect to any
portion of any payments hereunder.
(f) Employee shall have no duty to mitigate any damages that
he may incur by reason of termination of employment under the circumstances
described in Section 7(c) and shall be entitled to receive the amounts provided
in Section 7(c) regardless of any income that he may receive from other sources
following the date he becomes entitled to receive such amounts.
(g) Neither this Agreement nor any right or interest hereunder
shall be assignable by the Employee or his beneficiaries or legal
representatives without the Company's prior written consent; provided, however,
that nothing in this Section 7 shall preclude the Employee from designating a
beneficiary to receive any benefit payable hereunder upon his death or
incapacity.
(h) Except as required by law, no right to receive payments
under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion,
attachment, levy or similar process or to assignment by operation of law, and
any attempt, voluntary or involuntary, to effect any such action shall be null,
void and of no effect.
8. RESTRICTIVE COVENANTS.
(a) During the Employment Term and, in the event that the
Employee's employment is terminated for any reason (including the non-renewal of
this Agreement in accordance with Section 2(b) above), during the 18-month
period following such termination, the Employee will not directly or indirectly
(as a director, officer, executive employee, manager, consultant, independent
contractor, advisor or otherwise) engage in competition with, or own any
interest in, perform any services for, participate in or be connected with any
6
business or organization that engages in competition with any of the FIRSTPLUS
Companies within the meaning of Section 8(d), provided, however, that the
provisions of this Section 8(a) shall not be deemed to prohibit the Employee's
ownership of not more than 2% of the total shares of all classes of stock
outstanding of any publicly held company.
(b) In the event that the Employee's employment is terminated
for any reason (including the non-renewal of this Agreement in accordance with
Section 2(b) above), during the 18-month period following such termination, the
Employee will not directly or indirectly hire, solicit, retain, compensate or
otherwise induce or attempt to induce any person who is and/or was an employee
of any of the FIRSTPLUS Companies at any time during the six months prior to the
Employee's termination, to leave the employ of the FIRSTPLUS Companies, or in
any way interfere with the relationship between any of the FIRSTPLUS Companies
and any employee thereof.
(c) During the Employment Term and, in the event that the
Employee's employment is terminated for any reason (including the non-renewal of
this Agreement in accordance with Section 2(b) above), during the 18-month
period following such termination, the Employee will not directly or indirectly
hire, engage, send any work to, place orders with, or in any manner be
associated with any supplier, contractor, subcontractor or other business
relation of any of the FIRSTPLUS Companies if such action by the Employee would
have a material adverse effect on the business, assets or financial condition of
any of the FIRSTPLUS Companies, or materially interfere with the relationship
between any such person or entity and any of the FIRSTPLUS Companies.
(d) For all purposes in this Section 8, a person or entity
(including without limitation, the Employee) shall be deemed to be a competitor
of or engaging in competition with one or more of the FIRSTPLUS Companies, if
such person or entity engages in any business competing with, or substantially
similar to, the businesses of one or more of the FIRSTPLUS Companies, as such
businesses exist at the time of termination of the Employee's employment with
the Company in any state of the United States of America in which any of the
FIRSTPLUS Companies conduct, or are actively investigating the possibility of
conducting, their businesses at the time of such termination. The provisions of
this Section 8 shall cease to be applicable to any state in which the FIRSTPLUS
Companies are actively investigating the possibility of conducting their
businesses at the time of termination of Employee's employment with the Company,
unless within three months after such termination, the FIRSTPLUS Companies, or
any of them, have commenced soliciting prospective customers in such state, and
have effectuated either of the following: (i) the opening of an office in such
state; or (ii) the hiring of one or more employees to be employed in such state
or the assignment of one or more incumbent employees to solicit business in such
state.
(e) In connection with the foregoing provisions of this
Section 8, the Employee represents that his experience, capabilities and
circumstances are such that such provisions will not prevent him from earning a
livelihood. The Employee further agrees that the limitations set forth in this
Section 8 (including, without limitation, time limitations) are reasonable and
properly required for the adequate protection of the current and future
7
businesses of the FIRSTPLUS Companies. It is understood that the covenants made
by the Employee in this Section 8 (and in Section 6 hereof) shall survive the
expiration or termination of this Agreement.
9. LEGITIMATE BUSINESS INTERESTS OF THE FIRSTPLUS COMPANIES.
(a) The parties hereto acknowledge and agree that the matters
set forth above in Sections 6 and 8 constitute the legitimate business interests
of the FIRSTPLUS Companies and are hereby conclusively agreed to be legally
sufficient to support such covenants. Such legitimate business interests include
but are not necessarily limited to trade secrets; valuable confidential business
or professional information that does not legally qualify as trade secrets;
substantial relationships with specific prospective or existing customers or
clients; customer or client good will associated with an ongoing business in a
specific geographic location and a specific marketing area; and extraordinary or
specialized training. It is further acknowledged and agreed that all such
restrictive covenants set forth above are reasonably necessary to protect the
legitimate business interests of the FIRSTPLUS Companies and are not overbroad
or unreasonable. It is acknowledged and agreed that the Company is specifically
relying upon the foregoing statements in entering into this Agreement.
(b) The Employee acknowledges that a remedy at law for any
breach or threatened breach of the provisions of Sections 6 or 8 hereof would be
inadequate, that the FIRSTPLUS Companies would be irreparably injured by such
breach and that, therefore, the FIRSTPLUS Companies shall be entitled to
injunctive relief in addition to any other available rights and remedies in case
of any such breach or threatened breach.
10. BINDING EFFECT. Without limiting or diminishing the effect of
Section 7 hereof, this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective heirs, successors, legal
representatives and assigns.
11. NOTICES. All notices that are required or may be given
pursuant to the terms of this Agreement shall be in writing and shall be
sufficient in all respects if given in writing and (i) delivered personally,
(ii) mailed by certified or registered mail, return receipt requested and
postage prepaid, or (iii) sent via a responsible overnight courier, to the
parties at their respective addresses set forth above, or to such other address
or addresses as either party shall have designated in writing to the other party
hereto. The date of the giving of such notices delivered personally or by
carrier shall be the date of their delivery and the date of giving of such
notices by certified or registered mail shall be the date five days after the
posting of the mail.
12. LAW GOVERNING. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, except that body of
law relating to choice of laws.
13. SEVERABILITY. In the event that any court of competent
jurisdiction shall finally hold that any provision of Section 6 or 8 hereof is
void or constitutes an unreasonable restriction against the Employee, Section 6
or 8, as the case may be, shall not be rendered void, but shall apply with
respect to such extent as such court may judicially determine constitutes a
reasonable restriction under the circumstances, and, in such connection, the
8
parties hereto authorize any such court to modify or sever any such provision,
including without limitation, any such provision relating to duration and
geographical area, to the extent deemed necessary or appropriate by such court.
If any part of this Agreement other than Section 6 or 8 is held by a court of
competent jurisdiction to be invalid, illegal or incapable of being enforced in
whole or in part by reason of any rule of law or public policy, such part shall
be deemed to be severed from the remainder of this Agreement for the purpose
only of the particular legal proceedings in question and all other covenants and
provisions of this Agreement shall in every other respect continue in full force
and effect and no covenant or provision shall be deemed dependent upon any other
covenant or provision.
14. WAIVER. Failure to insist upon strict compliance with any of the
terms, covenants or conditions hereof shall not be deemed a waiver of such term,
covenant or condition, nor shall any waiver or relinquishment of any right or
power hereunder at any one or more times be deemed a waiver or relinquishment of
such right or power at any other time or times.
15. ENTIRE AGREEMENT; MODIFICATIONS. This Agreement constitutes the
entire agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements, oral and written, between the parties hereto
with respect to the subject matter hereof. This Agreement may be modified or
amended only by an instrument in writing signed by both parties hereto.
16. SURVIVAL OF PROVISIONS. Neither the termination of this
Agreement, nor of Executive's employment hereunder, shall terminate or affect in
any manner any provision of this Agreement that is intended by its terms to
survive such termination, including without limitation, the provisions of
Sections 4 to 8 inclusive and Section 11 hereof.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Employee have duly executed
and delivered this Agreement, as of the day and year first above written.
FIRSTPLUS FINANCIAL GROUP, INC.
By: /s/ John Maxwell
---------------------------
Name: John Maxwell
Title: President and Chief Executive Officer
/s/ William Handley
------------------------------
William Handley
9
APPENDIX A
None
Exhibit 99.1
FIRSTPLUS FINANCIAL GROUP, INC.
POLICY AND PROCEDURES GOVERNING SALES AND PURCHASES OF COMPANY SECURITIES BY
INSIDERS
I. PURPOSE
In order to comply with federal and state securities laws governing (a)
trading in an issuer's securities while in the possession of "material
nonpublic information" concerning the issuer, and (b) disclosure of
material nonpublic information about an issuer to outsiders, and in order
to prevent even the appearance of improper insider trading or tipping,
FirstPlus Financial Group, Inc. (the "Company") has adopted this Policy
for all of its directors, officers and employees, their immediate family
members and specially designated outsiders who have access to the
Company's material nonpublic information.
II. SCOPE
A. This Policy covers all directors, officers and employees of the
Company and their immediate family members (collectively referred to
as "Insiders"), and any outsiders whom the Compliance Officer may
designate as Insiders because they have access to material nonpublic
information concerning the Company.
B. Except as provided in Section VI below, this Policy applies to any
and all transactions in the Company's securities, including its
Common Stock and options to purchase Common Stock, and any other
type of securities that the Company may hereafter issue, such as
preferred stock, convertible debentures, warrants and options or
other derivative securities.
C. This Policy will be delivered to all directors, officers, employees
and designated outsiders upon its adoption by the Company, and to
all new directors, officers, employees and designated outsiders at
the start of their employment or relationship with the Company. Upon
first receiving a copy of this Policy or any revised versions, each
Insider must sign an acknowledgment that he or she has received a
copy, confirming agreement to comply with this Policy's terms.
III. INSIDER TRADING COMPLIANCE OFFICER
The Company has designated its Chief Financial Officer as its Insider
Trading Compliance Officer (the "Compliance Officer"). The Compliance
Officer, in consultation with the Company's outside securities counsel
(the "Securities Counsel"), will review and, wherever appropriate, approve
proposed trades by Insiders.
In addition to the trading approval duties described in Section V.C below,
the duties of the Compliance Officer will include the following:
A. Administering this Policy and monitoring and enforcing compliance
with all Policy provisions and procedures;
B. Responding to all inquiries relating to this Policy and its
procedures;
C. Designating and announcing regular and special trading blackout
periods;
D. Providing copies of this Policy and other appropriate materials to
all current and new directors, officers and employees, and such
other persons whom the Compliance Officer determines have access to
material nonpublic information concerning the Company;
E. Administering, monitoring and enforcing compliance with all federal
and state insider trading laws and regulations, including without
limitation Sections 10(b), 16, 20A and 21A of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules
and regulations promulgated thereunder, and Rule 144 under the
Securities Act of 1933, as amended; and assisting in the preparation
and filing of all required reports with the Securities and Exchange
Commission (the "SEC") relating to ownership of Company securities,
including without limitation Forms 3, 4, 5 and 144 and Schedules 13D
and 13G under the Exchange Act;
F. Revising this Policy as necessary to reflect changes in federal or
state insider trading laws and regulations; and
G. Maintaining as Company records originals or copies of all documents
required by the provisions of this Policy or the procedures set
forth herein, and copies of all required SEC reports relating to
insider trading, including without limitation Forms 3, 4, 5 and 144
and Schedules 13D and 13G.
The Compliance Officer may designate one or more individuals who may
assist him/her in the performance of his/her duties and/or perform the
Compliance Officer's duties in the event that he/she is unable or
unavailable to perform such duties.
IV. DEFINITION OF "MATERIAL NONPUBLIC INFORMATION"
A. "MATERIAL" INFORMATION
Information about the Company is "material" if it would be expected to
affect the investment or voting decisions of the reasonable shareholder or
investor, or if the disclosure of the information would be expected to
significantly alter the total mix of the information in the marketplace
about the Company. In simple terms, material information is any type of
information that could reasonably be expected to affect the price of
Company securities. While it is not possible to identify all information
that would be deemed "material," the following types of information
ordinarily would be considered material:
o Financial performance, especially quarterly and year-end earnings,
and significant changes in financial performance or liquidity;
2
o Potential mergers and acquisitions or the sale of Company assets
or subsidiaries;
o New significant contracts, orders, customers, or finance sources,
or the loss thereof;
o Significant policy pricing changes;
o Stock splits and extraordinary dividends;
o Public or private securities/debt offerings;
o Significant changes in senior management; and
o Actual or threatened major litigation or the resolution of such
litigation.
B. "NONPUBLIC" INFORMATION
Material information is "nonpublic" if it has not been widely disseminated
to the public through major newswire services, national news services and
financial news services. For the purposes of this Policy, information will
be considered public, I.E., no longer "nonpublic," after the close of
trading on the second full trading day following the Company's widespread
public release of the information.
V. STATEMENT OF COMPANY POLICY AND PROCEDURES
A. PROHIBITED ACTIVITIES
1. No Insider may trade in Company securities without following
the procedures set forth in Section V.C below.
2. Except as provided in Section VI below, no Insider may trade
in Company securities while possessing material nonpublic
information concerning the Company. The fact that a trade may
have been approved does not excuse a violation of law. It is
ultimately the Insider's responsibility not to trade in the
Company's securities while in possession of material nonpublic
information concerning it.
3. Except as provided in Section VI below, no Insider may trade
in Company securities during any regular trading blackout
period or during any special trading blackout period
designated by the Compliance Officer.
4. The Compliance Officer may not trade in Company securities
unless the trade has been approved by the Chief Executive
Officer of the Company and Securities Counsel in accordance
with the procedures set forth in Section V.C below.
3
5. No Insider may "tip" or disclose material nonpublic
information concerning the Company to any non-Insider
(including analysts, individual investors and members of the
investment community and news media), unless required as part
of that Insider's regular duties for the Company and
authorized by the Compliance Officer and/or the Chief
Executive Officer. In any instance in which such information
is disclosed to outsiders, the Company will take such steps as
are necessary to preserve the confidentiality of the
information, including requiring the outsider to agree in
writing to comply with the terms of this Policy and/or to sign
a confidentiality agreement. All inquiries from outsiders
regarding material nonpublic information about the Company
must be forwarded to the Compliance Officer or the Chief
Executive Officer.
6. No Insider may give trading advice of any kind about the
Company to anyone while possessing material nonpublic
information about the Company, except that Insiders should
advise others not to trade if doing so might violate the law
or this Policy. The Company strongly discourages all Insiders
from giving trading advice concerning the Company to third
parties even when Insiders do not possess material nonpublic
information about the Company.
7. No Insider may trade in any interest or position relating to
the future price of Company securities, such as a put, call or
short sale.
B. TRADING BLACKOUT PERIODS
1. REGULAR TRADING BLACKOUT PERIODS. The Company has established
four regular trading blackout periods annually. These periods
begin 14 days prior to the anticipated date of public
announcement of the Company's results of operations for the
first, second and third calendar quarters and for the full
calendar year and end at the close of the second full trading
day following the date on which such public announcement is
made. The Compliance Officer will announce each regular
trading blackout period prior to its commencement. The dates
of regular trading blackout periods may vary from year to year
depending upon projected public announcement dates, but
generally such periods will occur in March, late April/early
May, late July/early August and late October/early November.
2. SPECIAL TRADING BLACKOUT PERIODS. From time to time, the
Compliance Officer may announce special trading blackout
periods. Such designation may specify the duration of the
period or may require that Insiders refrain from trading in
Company securities until a further announcement that the
special trading blackout period has ended. No Insider may
disclose to any non-Insider that a special trading blackout
period has been designated.
4
3. ANNOUNCEMENTS OF TRADING BLACKOUT PERIODS. All regular and
special trading blackout periods and the termination of
special trading blackout periods will be announced by
Company-wide electronic mail.
4. EXCEPTIONS FOR HARDSHIP AND EXPIRING OPTION CASES. The
Compliance Officer may, after consultation with Securities
Counsel, on a case-by-case basis, authorize trading in Company
securities during a trading blackout period due to financial
or other hardships or when an Insider's stock option is about
to expire, but only in accordance with the procedures set
forth in Section V.C.
C. PROCEDURES FOR APPROVAL
1. CLEARANCE BY COMPLIANCE OFFICER. Each proposed trade in
Company securities and each Rule 10b5-1 sales plan proposed to
be adopted by an Insider (referred to in Section VI) must be
approved in writing by the Compliance Officer. A request for
approval must be submitted in writing in the applicable form
attached to this Policy, either in paper or electronically.
The request should be submitted as far in advance of the
proposed trade/adoption as practicable, but in any event
should be submitted not less than two days in advance of the
proposed trade/adoption. The Compliance Officer will consult
with Securities Counsel as he/she believes necessary or
desirable.
2. NO OBLIGATION TO APPROVE TRADES. The existence of the
foregoing approval procedure does not in any way obligate the
Compliance Officer to approve any trades or sales plans. The
Compliance Officer may reject any request in his/her sole
discretion based upon either or both of securities laws
requirements and the Company's business needs.
VI. SALES UNDER RULE 10B5-1 SALES PLANS
Anything contained in this Policy to the contrary notwithstanding, sales
of Company securities pursuant to a sales plan adopted by an Insider,
which plan conforms to the requirements of Rule 10b5-1 under the Exchange
Act and is approved by the Chief Compliance Officer, shall be exempt from
the provisions of this Policy.
VII. POTENTIAL CIVIL, CRIMINAL AND DISCIPLINARY SANCTIONS
A. CIVIL AND CRIMINAL PENALTIES
The consequences of prohibited insider trading or tipping can be severe.
Persons violating insider trading or tipping rules may be required to
disgorge the profit made or the loss avoided by the trading, pay the loss
suffered by the person who purchased securities from or sold securities to
an insider tippee, pay civil penalties up to three times the profit made
or loss avoided, pay a criminal penalty of up to $1 million, and serve a
5
jail term of up to 10 years. The Company and/or the supervisors of the
person violating the rules may also be required to pay major civil or
criminal penalties.
B. COMPANY DISCIPLINE
Violation of this Policy or federal or state insider trading laws by any
director, officer or employee, or their family members, may subject the
director to removal and the officer or employee to disciplinary action by
the Company up to and including termination for cause.
C. REPORTING OF VIOLATIONS
Any Insider who violates this Policy or any federal or state laws
governing insider trading or tipping, or knows of any such violation by
any other Insiders, must report the violation immediately to the
Compliance Officer. Upon learning of any such violation, the Compliance
Officer, in consultation with Securities Counsel, will determine whether
the Company should release any material nonpublic information, or whether
the Company should report the violation to the SEC or other appropriate
governmental authority.
VIII. INQUIRIES
Please direct all inquiries regarding any of the provisions of or
procedures under this Policy to the Compliance Officer.
6
RECEIPT AND ACKNOWLEDGMENT
I, _________________________, hereby acknowledge that I have received and read a
copy of the "FirstPlus Financial Group, Inc. Policy and Procedures Governing
Sales and Purchases of Company Securities by Insiders" and agree to comply with
its terms. I understand that violation of insider trading laws or regulations
may subject me to severe civil and/or criminal penalties, and that violation of
the terms of the above-titled Policy may subject me to discipline by the
Company, up to and including termination for cause.
------------------------------------- ---------------------------------------
Signature Date
7
APPLICATION AND APPROVAL FOR TRADING BY A FIRSTPLUS FINANCIAL
GROUP, INC. INSIDER
Name:
------------------------------------------------------------------------
Title:
------------------------------------------------------------------------
Proposed Trade Date:
-------------------------------------------------
Type of Security to be Traded:
-------------------------------------------------
Type of Trade (Purchase/Sale):
-------------------------------------------------
Number of Shares to be Traded:
-------------------------------------------------
CERTIFICATION
I, ____________________________, hereby certify that (i) I am not in possession
of any "material nonpublic information" concerning the Company (as defined in
the Company's "Policy and Procedures Governing Sales and Purchases of Company
Securities by Insiders") and (ii) to the best of my knowledge, the proposed
trade(s) listed above do(es) not violate trading restrictions under securities
laws applicable to me. I understand that if I trade while possessing such
information or in violation of such trading restrictions, even if this
application is approved, I may be subject to severe civil and/or criminal
penalties, and may be subject to discipline by the Company up to and including
termination for cause.
------------------------------------- ---------------------------------------
Signature Date
REVIEW AND DECISION
The undersigned hereby certifies that I have reviewed the foregoing application
and ______APPROVE _______PROHIBIT the proposed trade(s).
-------------------------------------------------- ----------------------------
Insider Trading Compliance Officer (or Designee) Date
8
APPLICATION AND APPROVAL FOR ADOPTION OF A RULE 10B5-1 PLAN BY A
FIRSTPLUS FINANCIAL GROUP, INC. INSIDER
Name:
------------------------------------------------------------------------
Title:
------------------------------------------------------------------------
Proposed Plan Adoption Date:
--------------------------------------------------
Type of Security to be Traded:
--------------------------------------------------
Number of Shares Covered under Plan:
-------------------------------------------
CERTIFICATION
I, ____________________________, hereby certify that (i) attached to this
Application is a true and correct copy of the Rule 10b5-1 Sales Plan proposed to
be adopted by me, (ii) I am not in possession of any "material nonpublic
information" concerning the Company (as defined in the Company's "Policy and
Procedures Governing Sales and Purchases of Company Securities by Insiders") and
(iii) to the best of my knowledge, adoption by me of proposed Plan does not
violate trading restrictions under securities laws applicable to me. I
understand that if I trade in violation of such trading restrictions, even if
this application is approved, I may be subject to severe civil and/or criminal
penalties, and may be subject to discipline by the Company up to and including
termination for cause.
------------------------------------- ---------------------------------------
Signature Date
REVIEW AND DECISION
The undersigned hereby certifies that I have reviewed the foregoing
application and ______APPROVE _______PROHIBIT the proposed Plan.
-------------------------------------------------- ----------------------------
Insider Trading Compliance Officer (or Designee) Date
9