Opinion ID: 147653
Heading Depth: 3
Heading Rank: 1

Heading: Termination for Cause Claim

Text: Under the Agreement, Market Street was obligated to pay McBride the “Termination Payments” if he terminated for cause. “Termination Payments” is defined in the Agreement as the sum of (1) the Annual Base Salary, (2) the Incentive Compensation and (3) health benefits for one year or the difference between the cost of COBRA benefits and the amount McBride paid for benefits at Market Street at the time of his termination for one year. The Agreement provides McBride’s Annual Base Salary is $230,000. It defines “Incentive Compensation” as “the highest annual incentive bonus argument, McBride argued for the first time that Market Street breached the Agreement by attempting to enforce its non-solicitation and non-competition provisions. We will not consider this argument. Fed. Ins. Co. v. Tri-State Ins. Co., 157 F.3d 800, 805 (10th Cir. 1998) (“Issues raised for the first time at oral argument are considered waived.”). 16 Market Street also alleges McBride received an impermissible double recovery. Because we conclude the damages awards are excessive, we need not address this issue. - 22 - paid or payable to [McBride] . . . for any of the two fiscal years . . . immediately prior to the fiscal year in which the date of termination of employment occurs.” (R. Vol. IV at 671.) The only “annual incentive bonus” is the “Net Contribution Incentive” which McBride was only entitled to if the Western Division was profitable.17 The evidence was clear the Western Division was not profitable. Finally, the evidence demonstrated McBride was paying $400 per month for benefits at Market Street at the time of his termination for cause and had paid $1,400 in COBRA benefits for one month after his 17 McBride argues the contingent part of his signing bonus is part of his “Incentive Compensation.” Market Street contends McBride would only be entitled to the $474,000 contingent payment if the Western Division originated and closed $600 million in volume and he remained in Market Street’s employ until the contingent payment was earned and paid. The evidence at trial demonstrated the Western Division reached the July 2005 to July 2006 volume goal, but McBride terminated his involvement with Market Street on March 1, 2006, and was thus gone for at least four of the relevant twelve months. In retrospect it is clear that had he stayed with Market Street for a few more months, applying his shoulder to the wheel, he would have been entitled to the contingent portion of the signing bonus. But he did not. While the signing bonus language does not specifically require McBride to be employed by Market Street in July 2006 or to have contributed one year’s effort in order to qualify for the one time/one year contingent bonus payment, it is fairly implied. In any event, the $474,000 contingent payments does not meet the definition of “Incentive Compensation” contained at Section 4.2 of the Agreement, which provides: Incentive Compensation. [McBride] shall be eligible for an annual incentive bonus determined from time to time in accordance with Annex C hereto. In addition, [McBride] shall be entitled to participate in such stock option programs as are made available to similarly situated executives of [Market Street] from time to time. Any options granted will comply in all respects with the terms of the NetBank, Inc. Stock Incentive Plan. The signing bonus (initial payment or contingent payment) does not satisfy the Agreement’s definition of “Incentive Compensation” as the described payments are not an “annual incentive bonus.” The only annual bonus mentioned in Annex C is the “Net Contribution Incentive Plan,” for which, as we will discuss, McBride did not qualify. - 23 - termination. Therefore, the difference in these monthly amounts ($1,000) for one year is $12,000. Consequently, the “Termination Payments” totaled $242,000 ($230,000 plus $12,000)—the amount awarded by the jury on the termination for cause claim.