Phil Fragasso, SVP and chief marketing officer officer at Rydex Investments, has filed a suit alleging that retention pay promised to him by Rydex's CEO, Carl Verbencoeur, has not been forthcoming. [Download original and amended complaint PDFs].

In a complaint filed on August 1, Fragasso says that he was promised an additional 30,000 "Executive Participation Units" by Verbencouer on top of the 30,000 units he received in June of 2006 for putting his John Hancock on a non-compete agreement. The added units are said to be worth $1.3 million, according to court papers.

The second set of 30,000 units included 20,000 units by June 2007 and the addition 10,000 in June of 2008, providing Fragasso was still employed by Rydex.

The suit also contends that Verbencour promised Fragasso that if Rydex were to be sold in the interim, Rydex would "do the right thing" and accelerate the award of the additional shares.

Based on the promise of the addition units, Fragasso signed an even more restrictive non-compete agreement and continued toiling away at the firm, despite his "lengthy" daily commute from Wellesley, Massachusetts to Rockville, Maryland.

Fragasso is suing Rydex for breach of contract and damages caused by the breach. He hopes to receive the 30,000 units promised, any other damages the court sees as necessary, and the cost of his attorney's fees.

A spokeswoman for Rydex said that the company does not comment on pending litigation. 

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