Unassociated Document


    EXHIBIT
      10.1

     

    SEVERANCE
      PACKAGE AND RELEASE AGREEMENT

     

    This
      Severance Package and Release Agreement (“Agreement”) is made and entered into
      between United PanAm Financial Corporation, United Auto Credit Corporation,
      and
      their officers, directors, shareholders, employees, representatives, attorneys,
      agents, affiliates and subsidiaries (hereinafter collectively referred to as
      “the Company”) and Ray Thousand (“Mr. Thousand”). The purpose of this Agreement
      is to settle and compromise any and all disputes and controversies of any nature
      existing between the parties, including, but not limited to, any claims arising
      out of Mr. Thousand’s employment with, and separation from, the Company.


     

    Separation
      of Employment.
      The
      cessation of Mr. Thousand’s employment with the Company was effective July 25,
      2008. Mr. Thousand has received all
      salary and benefits up to and including that date. Mr. Thousand has also
      received payment for all accrued and unused vacation as of July 25, 2008, less
      applicable state and federal taxes and withholdings. Mr. Thousand confirms
      that
      he has previously submitted any and all outstanding business related expenses
      for reimbursement and has received payment from the Company for such expenses.
      In addition, within 30 days of July 25, 2008, Mr. Thousand has the right to
      exercise One Million One-Hundred Seventy Thousand (1,170,000) options that
      have
      vested of Company common stock. Mr. Thousand has zero (0) shares of restricted
      Company common stock that have vested as of July 25, 2008. In selling any shares
      of Company common stock, Mr. Thousand shall be responsible for complying with
      Rule 144 of the Securities Act of 1933 for a period of 90 days from July 25,
      2008. In addition, Mr. Thousand understands that any purchase or sale of Company
      common stock made by him for six months prior to July 25, 2008 could potentially
      be matched to a purchase or sale of Company common stock made by him for six
      months after July 25, 2008 pursuant to Section 16 of the Securities Exchange
      Act
      of 1934. Mr. Thousand shall also be responsible for complying with any reporting
      obligations under Section 16 of the Securities Exchange Act of
      1934.

     

    Termination
      of Positions.
      Effective as of July 25, 2008, Mr. Thousand has been terminated as an officer,
      trustee and any other position currently held at the Company and any subsidiary
      of the Company.

     

    Resignation
      as Director.
      Effective as of July 25, 2008, Mr. Thousand hereby resigns as a director of
      the
      Company and any subsidiary of the Company. This resignation is not a result
      from
      any disagreement with the Company concerning any matter relating to the
      Company’s operations, policies or practices.

     

    1. Severance
      Payment, Target and Discretionary Bonuses, and COBRA
      Payments.
      After
      execution of this Agreement and the expiration of the revocation period provided
      in Paragraph 13 below, provided that this Agreement has not been revoked by
      Mr.
      Thousand, and after the return of all Company property as described in Paragraph
      2 below, the Company agrees to pay Mr. Thousand: (1) severance pay in an amount
      equivalent to twelve (12) months of his current base salary or Six Hundred
      Fifty
      Six Thousand and Two Hundred Fifty Dollars ($656,250), less applicable state
      and
      federal taxes and withholdings and (2) a prorated Target Bonus through the
      date
      of termination, in the amount of One Hundred Forty-Eight Thousand, Four Hundred
      and Sixty-Three Dollars ($148,463), less applicable state and federal taxes
      and
      withholdings, and (3) a prorated Discretionary Bonus, through the date of
      termination, in the amount of Seventy-Four Thousand, Two Hundred and Thirty-Two
      Dollars ($74,232). The severance pay, pro-rated Target Bonus and pro-rated
      Discretionary Bonus shall be wired to Mr. Thousand’s personal account. The
      Company further agrees to pay to the Company’s COBRA Administrator six (6)
      months of Mr. Thousand’s COBRA premium payments in the total amount of Three
      Thousand, One Hundred Forty-Nine and 58/100 Dollars ($3,149.48). Thereafter,
      Mr.
      Thousand shall be solely responsible for his COBRA payments should he choose
      to
      continue such benefits coverage. The Company shall not be providing Mr. Thousand
      any separate or additional notice with respect to this COBRA payment
      obligation.

     

    2. Return
      of Property.
      Mr.
      Thousand agrees immediately to return to the Company all property of the Company
      which he has in his custody or control such as keys, key cards, passwords,
      office equipment, forms, manuals, customer files, personnel files, or other
      confidential or proprietary materials of the Company.

     

    
      
        
        

      

      
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    3. Release
      of Known and Unknown Claims.
      In
      consideration of the payment outlined above and the further agreements set
      forth
      below, and excepting only the obligations created in this letter Agreement,
      Mr.
      Thousand hereby agrees unconditionally to release and discharge United Pan
      Am
      Financial Corporation, United Auto Credit Corporation, their respective current
      and former officers, directors, shareholders, employees, representatives,
      attorneys and agents, as well as their predecessors, parents, subsidiaries,
      affiliates, divisions, and successors in interest, of and from any and all
      claims, demands, liabilities, suits or damages of any type or kind, whether
      known or unknown, including, but not limited to, any claims or demands arising
      from or in any way related to Mr. Thousand’s employment with or separation from
      the Company on or before the date of the execution of this Agreement. Mr.
      Thousand also hereby releases the Company from any claims made to recover
      additional taxes paid under Internal Revenue Code Section 409A.

     

    This
      release specifically includes, without limitation, all claims for wrongful
      discharge, breach of express or implied contract, defamation, fraud,
      misrepresentation, discrimination, harassment, breach of implied covenant of
      good faith and fair dealing, compensatory and/or other relief relating or in
      any
      way connected with the terms, conditions, and benefits of employment,
      discrimination based on race, color, sex, religion, national origin, age,
      marital status, handicap and medical condition, and/or all claims arising under
      Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e
et
      seq.,
      the Age
      Discrimination in Employment Act of 1967 as amended by the Older Workers Benefit
      Protection Act, the California Fair Employment and Housing Act, the California
      Labor Code, the Family and Medical Leave Act, the California Family Rights
      Act,
      COBRA, the Employee Retirement Income Security Act of 1974 (“ERISA”), and/or
      violations of any other statutes, rules, regulations or ordinances whether
      federal, state or local.

     

    It
      is
      understood and agreed that this release extends to all claims of whatever
      nature, known or unknown, and includes all rights under Section 1542 of the
      Civil Code of California, which provides as follows:

     

    A
      general
      release does not extend to claims which the creditor does not know or suspect
      to
      exist in his or her favor at the time of executing the release, which if known
      by him or her must have materially affected his or her settlement with the
      debtor.

     

    Thus,
      notwithstanding the provisions of Section 1542, and for the purpose of
      implementing a full and complete release and discharge of all claims, Mr.
      Thousand expressly acknowledges that this Agreement also includes in its effect,
      without limitation, all claims that Mr. Thousand does not know or suspect to
      exist in his favor at the time of execution hereof, and that this Agreement
      contemplates the extinguishment of any and all such claim(s). Notwithstanding
      the foregoing, nothing in this Agreement shall prevent Mr. Thousand from filing
      a charge with any federal, state or administrative agency, but Mr. Thousand
      agrees not to participate in, and waives any rights with respect to, any
      monetary or financial relief arising from any such proceeding that relates
      to
      the matters released by this Agreement.

     

    4. No
      Admission of Liability.
      By
      entering into this Agreement, the Company and Mr. Thousand do not suggest or
      admit to any liability to each other or that they violated any law or any duty
      or obligation to the other party.

     

    5. Confidentiality.
      Mr.
      Thousand agrees that neither he nor his agents or representatives will disclose,
      disseminate and/or publicize, or cause or permit to be disclosed, disseminated
      or publicized, the existence of this Agreement, any of the terms of this
      Agreement, or any claims or allegations which he believes could have been made
      or asserted against the Company, directly or indirectly, specifically or
      generally, to any person, corporation, association or governmental agency or
      other entity, or participate, cooperate or assist any person(s) with respect
      to
      any claim they may have against the Company, except: (1) to the extent necessary
      to report income to appropriate taxing authorities; (2) to members of his
      immediate family; (3) in response to an order of a court of competent
      jurisdiction or subpoena issued under the authority thereof; or (4) in response
      to any inquiry or subpoena issued by a state or federal governmental agency;
      provided, however, that notice of receipt of such judicial order or subpoena
      shall be immediately communicated to the Company telephonically, and confirmed
      immediately thereafter in writing, so that the Company will have the opportunity
      to assert what rights it has to non-disclosure prior to the response to the
      order, inquiry or subpoena. Mr. Thousand also agree to maintain all non-public
      information regarding the Company while at the Company, including but not
      limited to, information regarding the Company’s customers, officers, directors,
      employees, financial and business information, and internal Company policies
      or
      procedures as strictly confidential and shall not disclose them to third
      parties.

     

    
      
        
        

      

      
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    In
      the
      event that the Human Resources Department of the Company receives an inquiry
      into Mr. Thousand’s employment with United Auto Credit Corporation related in
      any way to a future employment opportunity for Mr. Thousand, the Company will
      confirm, in writing, the dates of employment of Mr. Thousand, the last position
      he held with the Company, and if authorized in writing by Mr. Thousand, his
      last
      salary. In addition, the parties have agreed that the following statement will
      be provided with respect to Mr. Thousand’s separation from the Company: United
      PanAm Financial Corp. will announce the termination of Mr. Thousand as Chief
      Executive Officer of United PanAm Financial Corp. and United Auto Credit
      Corporation and any positions held with subsidiaries and will announce he has
      agreed to resign as a director. In return, Mr. Thousand will not provide or
      disclose any information, adverse or otherwise, regarding matters related to
      this Agreement or the Company to any other party or entity he is seeking
      employment with, nor with any current or past employees or vendors of the
      Company.

     

    Any
      violation of the confidentiality provision contained in this Agreement by Mr.
      Thousand shall be considered a material breach of this Agreement. 

     

    7. Employee
      Contact. At
      no
      time shall Mr. Thousand contact any employee who is currently employed by United
      Auto Credit Corporation or United Pan Am Financial Corporation during normal
      business hours for any reason. Should Mr. Thousand maintain personal
      relationships with United Auto Credit Corporation or United Pan Am Financial
      Corporation employees outside of employment with the Company, Mr. Thousand
      shall
      at no time discuss the terms of this Agreement with current employees of the
      Company.

     

    8. Arbitration.
      Any and
      all disputes, controversies or claims arising under or in any way relating
      to
      the interpretation, application or enforcement of this Agreement, Mr. Thousand’s
      employment with the Company, any claim for benefits, or his separation of
      employment from the Company, including without limitation any claim by him
      that
      he was fraudulently induced to enter into this Agreement, or regarding the
      enforceability or interpretation of this Agreement, shall be settled by final
      and binding arbitration under the auspices and rules of JAMS or other mutually
      agreeable alternative dispute resolution service in accordance with that
      service’s rules for the resolution of employment disputes. Any such arbitration
      must be filed in Orange, California, and the laws of the State of California
      shall control except where federal law governs. The prevailing party in any
      such
      arbitration proceeding shall be entitled to reasonable costs and attorney’s
      fees. The award of the arbitrator is to be final and enforceable in any court
      of
      competent jurisdiction.

     

    9. Waiver
      and Modification.
      The
      failure to enforce any provision of this Agreement shall not be construed to
      be
      a waiver of such provision or to affect either the validity of this Agreement
      or
      the right of any party to enforce the Agreement. This Agreement may be modified
      or amended only by a written agreement executed by Mr. Thousand and a properly
      authorized designee of the Board of Directors of the Company.

     

    10. Integration.
      This
      Agreement constitutes a single, integrated written contract expressing the
      entire agreement of the parties hereto relative to the subject matter hereof.
      No
      covenants, agreements, representations, or warranties of any kind whatsoever
      have been made by any party hereto. All prior discussions and negotiations
      have
      been and are merged and integrated into, and are superseded by, this
      Agreement.

     

    11. Severability.
      In the
      event that any provision of this Agreement should be held to be void, voidable,
      or unenforceable, the remaining portions hereof shall remain in full force
      and
      effect.

     

    12. Governing
      Law.
      This
      Agreement shall be construed in accordance with, and be governed by the laws
      of
      the State of California.

     

    
      
        
        

      

      
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    13. Right
      to an Attorney, Time to Consider, Revocation.
      Mr.
      Thousand acknowledges and agrees that he was provided twenty-one (21) days
      to
      consider this Agreement and to consult with counsel and the Company has advised
      Mr. Thousand of his right to do so. To the extent that Mr. Thousand has taken
      less than twenty-one (21) days to consider this Agreement, Mr. Thousand
      acknowledges that he has had sufficient time to consider the Agreement and
      to
      consult with counsel and that he does not desire additional time. This Agreement
      is revocable by Mr. Thousand for a period of seven (7) calendar days following
      Mr. Thousand’s execution of this Agreement. The revocation by Mr. Thousand of
      this Agreement must be by registered letter addressed to the undersigned
      representative of the Company, must specifically revoke this Agreement, and
      must
      be received by the Company prior to the eighth (8th) day following the execution
      of this Agreement by Mr. Thousand. This Agreement becomes effective, enforceable
      and irrevocable on the eighth (8th) day following Mr. Thousand’s execution of
      this Agreement.

     

    


     

    PLEASE
      READ CAREFULLY. THIS AGREEMENT CONTAINS A RELEASE OF ALL KNOWN AND UNKNOWN
      CLAIMS.

     

     

    UNITED
      PANAM FINANCIAL CORPORATION

    


    


    
      	/S/
              Giles H. Bateman	 	Dated:
              July 29,  2008 
	
              By:
                Giles H. Bateman

            	 	 


    

     

    
    

    I
      have carefully read this Agreement and understand that it contains a release
      of
      known and unknown claims. I acknowledge and agree to all of the terms and
      conditions of this Agreement. I further acknowledge that I enter into this
      Agreement voluntarily with a full understanding of its
      terms.

     

    


    
      	/S/
              Ray Thousand	 	Dated:
              July 29,  2008 
	
              
                Ray
                  Thousand

              

            	 	 


    

    
       

      
        
          
          

        

        
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