RETENTION
AGREEMENT
THIS RETENTION AGREEMENT (this
“Agreement”) is made and entered into as of
, 2006, by and between Encore
Credit Corp. (the “Company”) and
(“Employee”).
WHEREAS, Employee is currently
employed by the Company or one of its subsidiaries as its
;
WHEREAS, the Company is exploring
alternatives to maximize shareholder value, including the potential
merger of the Company with another entity or the sale of all or
substantially all of the assets and/or liabilities or capital stock
of the Company (referred to herein as a
“Transaction”);
WHEREAS, the Company believes it is
in the best interest of the Company to provide Employee with an
incentive to remain with the Company while the Company explores its
alternatives and to be available to the successor or acquirer of
the Company for a period of time after a Transaction; and
WHEREAS, Employee wishes to assist
the Company in exploring its alternatives and consummating a
Transaction and to continue to perform Employee’s present
responsibilities and support this transition and overall Company
business operations in a manner consistent with Employee’s
past high-level performance.
THEREFORE, in exchange for the
foregoing premises and the consideration set forth below, the
Employee and the Company (collectively, the “Parties”)
hereby agree as follows:
1. RETENTION BONUS
Employee shall be eligible to receive
a retention Bonus of $ (the
“Retention Bonus Amount”), less applicable withholding,
upon the following terms:
To be eligible to receive the
Retention Bonus Amount, Employee must be employed by ECC, a
subsidiary of ECC, or a successor in interest to ECC or ECC’s
subsidiaries’ business (collectively the
“Business”), as of [
] (the “Retention Bonus
Date”). If Employee: (i) terminates his/her employment
with the Business; (ii) refuses to accept employment offered
by a successor in interest to the Company or its business for any
reason; or (iii) the Company terminates Employee’s
employment with “Cause”, as defined in Section 3
below, on or before the Retention Bonus Date, the Retention Bonus
Amount shall not be earned, in whole or in part. However, if the
Business terminates Employee’s employment other than for
Cause prior to the Retention Bonus Date, Employee shall be paid the
Retention Bonus Amount on the date of such termination. If the
Retention Bonus Amount is earned, it shall be paid on the Retention
Bonus Date.
2. TRANSACTION BONUS [INSERT AS APPLICABLE]
Employee shall be eligible to receive
a transaction bonus of $ (the
“Transaction Bonus Amount”), less applicable
withholding, upon the following terms:
If a Transaction occurs on or before
March 31, 2007, and Employee is employed by ECC or one of its
subsidiaries as of the date of the consummation of the Transaction,
Employee shall be entitled to the Transaction Bonus Amount, which
shall be payable within 15 business days following the closing of
the Transaction.
3. DEFINITIONS
3.1 Cause . For purposes of
this Agreement, “cause” shall mean:
(a) Employee’s conviction
of or plea of nolo contender to a felony or any crime involving
moral turpitude;
(b) Employee’s commission
of any act of theft, embezzlement or misappropriation against the
Company;
(c) Employee’s failure to
substantially perform Employee’s duties hereunder (other than
such failure resulting from Employee’s incapacity due to
physical or mental illness), which failure is not remedied within
thirty (30) days after written demand for substantial
performance is delivered by the Company which specifically
identifies the manner in which the Company believes that Employee
has not substantially performed Employee’s duties; or
(d) Employee’s material
breach of his/her obligations under this Agreement, which breach is
not remedied within thirty (30) days after written notice is
delivered by the Company which specifica
