EMPLOYMENT AND NON-COMPETITION AGREEMENT--stephen J. Shugerman

EXHIBIT 10.22


EMPLOYMENT AND NON-COMPETITION AGREEMENT
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THIS EMPLOYMENT AND NON-COMPETITION AGREEMENT (the "Agreement") is made and entered into as of January 1, 1997, by and between Southern Pacific Thrift and Loan Association (the "Corporation"), a California corporation, and Stephen J. Shugerman, an individual (the "Executive").


WITNESSETH:


WHEREAS, the Corporation desires to employ the Executive as its President; and


WHEREAS, Executive has agreed not to compete with Corporation or use any confidential and proprietary business information regarding the business of Corporation to the detriment of Corporation during the term of this Agreement (and thereafter as applicable) in order to induce Corporation to enter into this Agreement and to perform its obligations hereunder; and


WHEREAS, the Executive desires to accept such employment under the terms and conditions herein stated.


NOW, THEREFORE, the Corporation and the Executive, each intending to be legally bound, hereby mutually covenant and agree as follows:


1. Employment and Term
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(a) Employment - The Corporation hereby offers to employ the Executive as the President of the Corporation on the terms and conditions set forth herein, and the Executive hereby accepts such employment, for the term set forth in Section 1(b).


(b) Term - The employment hereunder shall be for a term of five years (the "Term") commencing on January 1, 1997 and terminating on December 31, 2002 (the "Expiration Date"), provided that such term may be extended if authorized by the Board and evidenced by a written agreement signed by the Chairman of the Corporation and the Executive.


2. Duties
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During his Term, the Executive shall serve as President of the Corporation and shall have all powers and duties consistent with such position subject to the direction of the Chairman of the Corporation, to whom the Executive shall report. The Executive shall devote


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his full time and attention and best efforts to fulfill faithfully, responsibly and to the best of his ability his duties hereunder.


3. Compensation
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(a) Base Salary - For services performed by the Executive for the Corporation pursuant to this Agreement during his Term, the Corporation shall pay the Executive a base salary ("Base Salary") at the rate of $250,000 per year, payable twice each month in the amount of $10,416.67 on the 15th day and last day of each month, or in accordance with the Corporation's regular payroll practices. Any compensation which may be paid to the Executive under any additional compensation plan of the Corporation, or which may be otherwise authorized from time to time by the Board, shall be in addition to the Base Salary to which the Executive shall be entitled under this Agreement.


(b) Annual Bonus - For each full year during his Term, commencing on January 1, 1997, the Executive shall be eligible to receive a cash bonus based on the Corporation's achievement of certain financial and business goals established at the beginning of such year by the Chairman of the Corporation. For calendar year 1997, and until changed by the Chairman, the annual cash bonus award shall be determined on the basis of the performance of three components, namely, Imperial Credit Industries, Inc.'s earnings per share and two qualitative measures of the Corporation's performance. Depending on the results of each component, the Executive's cash bonus will range from $0 to $500,000, as follows:


(i) Earnings per share - If Imperial Credit Industries Inc.'s earnings per share are less than $1.25 for the calendar year, no cash bonus shall be paid for this component. If earnings per share are from $1.25 to $1.50, the cash bonus shall be $50,000 for this component; if from $1.50 to $1.75, $100,000; and, if $1.75 or more, $167,000;


(ii) Qualitative Objective No. 1 - If Southern Pacific Thrift and Loan Association's existing Memorandum of Understanding with the Federal Deposit Insurance Corporation and the California Department of Corporations is augmented with additional corrective measures following the 1997 examination or more severe agency actions are taken, no cash bonus shall be paid for this component. If the Memorandum of Understanding remains in effect without substantive change as a result of the 1997 safety and soundness examination to the date of the 1998 examination, the cash bonus shall be $50,000 for this component. If the corrective measures required to be taken under the Memorandum of Understanding are materially reduced in scope as a result of the 1997 examination, the cash bonus shall be $100,000 for this component. If the Memorandum of Understanding is removed entirely as a result of the 1997 examination or at any time prior to the 1998 safety and soundness examination, the cash bonus shall be $167,000 for this component;


(iii) Qualitative Objective No. 2 - If Southern Pacific Thrift and Loan Association's 1997 safety and soundness examination rating is below the composite rating of the prior year's safety and soundness examination, no cash bonus shall be paid


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for this component. If the safety and soundness examination rating equals
the composite rating for the prior year, then the cash bonus shall be
$50,000 for this component. If the safety and soundness examination rating
is maintained at the prior year's level but with significant substantive
improvements noted in the report of examination, the cash bonus shall be
$100,000 for this component. If the 1997 safety and soundness examination
rating is improved from the prior year, the cash bonus shall be $167,000 for
this component.


The bonus payable for any calendar year shall be paid to the Executive no later than the 15th day of April of the following year. This annual bonus arrangement shall be in lieu of the Executive's participation in any other cash bonus or cash incentive plan or arrangement of the Corporation; provided, however, that the foregoing shall not preclude the Executive from participating in any equity or equity-based compensation program of the Corporation, and the bonus program set forth herein may be replaced with a different program approved by the Chairman and agreed with the Executive.


(c) Equity - The Executive shall be eligible to receive grants of common stock of Imperial Credit Industries, Inc. under the 1996 Stock Option Plan (the "Plan") and any successor or addition thereto, in the sole discretion of the Board-appointed committee which administers the Plan.


(d) Tax Withholding - The Corporation shall provide for the withholding of any taxes required to be withheld by federal, state and local law with respect to any payment in cash, shares of capital stock or other property made by or on behalf of the Corporation to or for the benefit of the Executive under this Agreement or otherwise. The Corporation may, at its option: (i) withhold such taxes from any cash payments owing from the Corporation to the Executive, including any payments owing under any other provision of the Agreement, (ii) require the Executive to pay to the Corporation in cash such amount as may be required to satisfy such withholding or (iii) make other satisfactory arrangements with the Executive to satisfy such withholding obligations.


4. Benefits
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In addition to the Base Salary to be paid to the Executive pursuant to Section 3(a) hereof and any annual bonuses earned by, and discretionary grants of common stock awarded to, the Executive pursuant to Sections 3(b) and 3(c) hereof, the Executive shall also be entitled to the following:


(a) Participation in Insurance and Healthcare Benefit Plans - Except as otherwise expressly provided herein, the Executive and his dependents shall be enrolled in the Corporation's insurance and healthcare benefit group plans in accordance with established Corporation policies.


(b) Participation in the Corporation's 401(k) Plan - The Executive shall be entitled to participate in the Corporation's 401(k) Plan in accordance with established Corporation policies.


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(c) Expense Reimbursement - The Corporation shall reimburse the Executive, upon proper accounting, for reasonable business expenses incurred by him in the course of the performance of his duties under this Agreement.


(d) Vacations, Holidays, Absences and Leaves - The Executive shall be entitled to the benefit of the vacation, holiday, absence and leave policies applicable to all employees of comparable title or status in the Corporation.


(e) Automobile Allowance - The Corporation shall pay the Executive a monthly automobile allowance of $900, to be applied in the Executive's discretion. The Corporation shall not provide the Executive any vehicles, insurance or the cost of any maintenance hereunder.


(f) Proration of Benefits - Any payments or benefits pursuant to this Section 4, in any year during which the Executive is employed by the Corporation for less than the entire year, shall, unless otherwise provided herein or in the applicable plan or arrangement, be prorated in accordance with the number of days in such year during which the Executive is employed by the Corporation.


5. Indemnification
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The Executive shall be entitled to the maximum indemnification provided by the Bylaws and the Articles of Incorporation of the Corporation for officers, directors and employees of the Corporation. The Executive's rights under this paragraph shall continue without time limit so long as he may be subject to any such liability, whether or not the Executive's term of employment by the Corporation may have ended.


6. Representations and Warranties of the Executive
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The Executive hereby represents and warrants to the Corporation that (a) the Executive's execution and delivery of this Agreement and his performance of his duties and obligations hereunder will not conflict with, or cause a default under, or give any party a right to damages under, or to terminate, any other agreement to which the Executive is a party or by which he is bound, and (b) there are no agreements or understandings that would make unlawful the Executive's execution or delivery of this Agreement or his employment hereunder.


7. Representations and Warranties of the Corporation
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The Corporation hereby represents and warrants to the Executive as follows:


(a) The Corporation is duly organized and established as a corporation under the laws of the State of California and has all requisite power and authority to enter into this Agreement and to perform its obligations hereunder. The consummation of the transactions contemplated by this Agreement will neither violate nor be in conflict with any agreement or instrument to which the Corporation is a party or by which it is bound.


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(b) The execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite corporate action on the part of the Corporation and are valid, legal and binding obligations of the Corporation, enforceable in accordance with their terms except as may be limited by laws of general application relating to bankruptcy, insolvency, moratorium or other similar laws relating to or affecting the enforcement of creditors' rights generally, and rules of law governing specific performance, injunctive relief or other equitable remedies.


8. Termin ...