EXHIBIT 10.1
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RETENTION AGREEMENT
THIS AGREEMENT is entered into as of August 11, 2005 by and between
▇▇▇▇▇ Management Co., Inc. and BKF CAPITAL GROUP, INC., both Delaware
corporations (referred to collectively herein as the "Company"), and ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ("Employee").
W I T N E S S E T H
WHEREAS, the Company considers the establishment and maintenance of a
sound and vital employee infrastructure to be essential to protecting and
enhancing the best interests of the Company and its stockholders; and
WHEREAS, the Board (as defined in Section 1) has determined that it is
in the best interests of the Company and its stockholders to secure Employee's
and certain other employees of the Company (identified below) continued services
and to ensure Employee's and such other employees' continued and undivided
dedication to his and their duties, respectively; and
WHEREAS, the Board has authorized the Company to enter into this
Agreement,
NOW, THEREFORE, for and in consideration of the promises and the mutual
covenants and agreements herein contained, the Company and Employee hereby agree
as follows:
1. DEFINITIONS. As used in this Agreement, the following terms
shall have the respective meanings set forth below:
(a) "Board" means the Board of Directors of the Company.
(b) "Cause" means: (i) the willful and continued failure
of Employee to substantially perform his duties with the Company (other than any
such failure resulting from Employee's incapacity due to physical or mental
illness or any such failure subsequent to Employee being delivered a Notice of
Termination without Cause by the Company or delivering a Notice of Termination
for Good Reason to the Company) after a written demand for substantial
performance is delivered to Employee by the Board which specifically identifies
the manner in which the Board believes that Employee has not substantially
performed Employee's duties and Employee has not cured to the satisfaction of
the Board any such failure that is capable of being cured in all respects within
ten (10) days of receiving such written demand; (ii) the willful engaging by
Employee in misconduct which is demonstrably and materially injurious to the
Company or its affiliates; or (iii) Employee's conviction of, or plea of guilty
or no contest to, any felony. For purpose of the preceding sentence, no act or
failure to act by Employee shall be considered "willful" unless done or omitted
to be done by Employee in bad faith and without reasonable belief that
Employee's action or omission was in the best interests of the Company. Any act,
or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board, based upon the advice of counsel for the Company (or upon
the instructions of an officer of the Company) shall be conclusively presumed to
be done, or omitted to be done, by Employee in good faith and in the best
interests of the Company. "Cause" shall not include mere poor performance or
underperformance of the Company's Long Only Investment and Trading Group
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and/or any fund(s) managed by it and/or Employee. The Company must notify
Employee of any event constituting Cause within thirty (30) days following the
Company's knowledge of its existence or such event shall not constitute Cause
under this Agreement.
(c) "Date of Termination" means (i) the effective date on
which Employee's employment by the Company terminates as specified in a prior
written notice by the Company or Employee, as the case may be, to the other,
delivered pursuant to Section 10 or (ii) if Employee's employment by the Company
terminates by reason of death, the date of death of Employee.
(d) "Disability" means termination of Employee's
employment by the Company due to Employee's absence from Employee's duties with
the Company on a full-time basis for at least one hundred eighty (180)
consecutive days as a result of Employee's incapacity due to physical or mental
illness; PROVIDED, THAT, the Company may not terminate the Employee's employment
as a result of Disability unless it has first given the Employee notice of such
termination and, within thirty (30) days after such notice is given, the
Employee has not returned to the full-time performance of the Employee's duties.
(e) "Good Reason" means, without Employee's express
written consent, the occurrence of any of the following events:
(i) (A) any change in the duties or
responsibilities (including reporting responsibilities) of
Employee that is inconsistent in any material and adverse
respect with Employee's position(s), duties, responsibilities
or status with the Company (including any material and adverse
diminution of such duties or responsibilities) or (B) a
material and adverse change in Employee's titles or offices
with the Company;
(ii) a reduction by the Company in Employee's
rate of annual base salary as the same may be increased from
time to time thereafter;
(iii) any requirement of the Company that Employee
be based anywhere other than the office where Employee is
located at the date of this Agreement, if such relocation
increases Employee's commute by more than thirty-five (35)
miles;
(iv) the failure by the Company or any of its
affiliates to pay any compensation to Employee within seven
(7) days of its becoming due; or
(v) the failure of the Company to obtain the
assumption (and, if applicable, guarantee) of this Agreement
from any successor (and Parent Corporation) as contemplated in
Section 9(b);
PROVIDED, that, in the case of any event described in clauses (i) through (v)
which is an isolated, insubstantial and inadvertent event, the Company has not
cured such change, reduction, requirement or failure within thirty (30) days
after receiving written notice thereof from Employee.
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(f) "Qualifying Termination" means a termination of
Employee's employment: (i) by the Company other than for Cause; (ii) by Employee
for Good Reason; or (iii) due to his death or Disability.
(g) "Subsidiary" means any corporation or other entity in
which the Company has a direct or indirect ownership interest of 50% or more of
the total combined voting power of the then outstanding securities or interests
of such corporation or other entity entitled to vote generally in the election
of directors or in which the Company has the right to receive 50% or more of the
distribution of profits or 50% of the assets upon liquidation or dissolution.
2. TERM: The term of this Agreement shall run from the date set
forth above through December 31, 2005 except that the respective provisions of
Section 3 (to the extent any amount due under such section shall not have been
paid by December 31, 2005), Section 4, Section 7 and Section 8 shall survive the
expiration of the term.
3. PAYMENTS
A. 2005 COMPENSATION
(a) Employee's annual base salary, and the annual base
salary of ▇▇▇▇ ▇▇▇▇▇▇ ("▇▇▇▇▇▇"), shall be increased
on a going forward basis effective August 1, 2005 for
the remainder of the term hereof to $800,000, without
retroactive adjustment for periods prior August 1,
2005.
(b) Except as otherwise provided below, for the
calendar/compensation year 2005, the Company shall
pay the below identified members (the "Group
Members") of the 2005 Long Only Investment and
Trading Group (the "Group"), which Group is currently
headed by Employee, a total minimum cash bonus
compensation (inclusive of 401k contributions made by
the Company, consistent with prior policy) of
$7,012,740 ("Group Minimum Bonus Compensation Pool"),
consisting of the Group Members' total 2004 and/or
2004 annualized cash bonuses of $5,612,740 plus an
additional $1,400,000. Each Group Member shall be
paid his/her 2005 bonus on or before January 15,
2006.
(c) Notwithstanding anything to the contrary stated
above, the Group Minimum Bonus Compensation Pool may
be allocated between and/or among Employee, ▇▇▇▇▇▇,
the Group Members and/or "Other Group Members" (as
defined below), or some of them. Such allocation -
whether to Employee, ▇▇▇▇▇▇, any Group Members and/or
any Other Group Members -- shall be made at the sole
and exclusive discretion of Employee (unless Employee
leaves the Company for any reason, in which case
Employee and the Company agree that such allocation
shall be made at the sole
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and exclusive discretion of ▇▇▇▇▇▇) and shall be
delivered to the Company in writing on or about
December 15, 2005. In the event Employee (or ▇▇▇▇▇▇
as the case may be) fails to timely deliver the
aforesaid written allocation, the Company shall
advise Employee (or, again, ▇▇▇▇▇▇ as the case may
be) in writing, and the Employee (or, again, ▇▇▇▇▇▇
as the case may be) shall deliver such written
allocation within three business days of the
Company's aforesaid notice. In the event neither
Employee nor ▇▇▇▇▇▇ are employed by the Company and
hence do not make the aforesaid allocation, each
Group Member shall be paid; (i) a 2005 cash bonus
equal to his/her 2004 cash bonus, or in the event the
Group Member commenced employment with the Group
after January 1, 2004, his or her 2004 cash bonus
annualized for a full year; and (ii) his/her PRO
RATA, portion of the aforesaid $1.4 million (based
upon such individual's respective total 2004 cash and
equity (for this purpose, "equity" means the value
(as determined by the Company in good faith) of any
equity awarded in 2004 as measured at the time of the
award) compensation (annualized where applicable)).
In no event shall any Group Member receive an
allocation from the Group Minimum Bonus Compensation
Pool if he or she is involuntarily terminated for
cause (in the case of Employee, if he is
involuntarily terminated for "Cause" or if he
voluntarily terminates employment without Good
Reason, as such terms, respectively, are defined
herein). For purposes of this Agreement, "cause" with
respect to any Group Member (other than Employee),
Other Group Member, Subsequent Group Member (as
defined herein) or Separate Group Member (as defined
herein), shall have the same meaning as the "Cause"
definition under Section 1(b), as applicable to
Employee, except that it shall apply to actions taken
(or failed to be taken) by the individual to whom it
applies.
(d) The Group Members are:
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(e) In the event a Group Member (other than Employee) who
was employed in the Group in 2004 is terminated
without cause, dies or terminates due to a disability
on or before December 31, 2005, he/she, or his/her
estate, shall be paid a minimum 2005 cash bonus,
within thirty days, at least equal to his/her 2004
cash bonus, provided, however, that in the event such
Group Member was employed by the Group for less than
all of 2004, he/she shall, or his/her estate, shall
instead be paid at least his/her 2004 bonus
annualized for a full year (E.G., a person who
commenced employment with the Group on July 1, 2004,
who received a cash bonus for 2004 of $50,000, and
who is terminated without Cause shall be paid a
minimum cash bonus for 2005 of $100,000).
(f) The Group Minimum Bonus Compensation Pool shall
exclude and be in addition to any payments made from
the other Alternative groups (including without
limitation SR Capital, RCL Capital, Island Drive,
and/or any other Alternative Group).
(g) Any Group Member (other than Employee) or Other Group
Member who voluntarily resigns for any reason or
whose employment is terminated for cause prior to
December 31, 2005, shall not be paid a bonus for
2005, and the amount of his/her 2004 cash bonus, or
annualized cash bonus in the event the Group Member
joined the Group after January 1, 2004, shall be
deducted from the Group Minimum Bonus Compensation
Pool.
(h) Any person who joins the Group in 2005 after
execution of this Agreement ("Subsequent Group
Member") shall be paid a 2005 cash bonus by the
Company pursuant to a separate written agreement and
not from the Group Minimum Bonus Compensation Pool.
(i) The following persons (the "Separate Group Members")
shall also be paid 2005 cash bonus compensation by
the Company, separate from and outside of the Group
Minimum Bonus Compensation Pool, as follows: (i) ▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇ - each in amounts
at least equal to their respective 2004 cash and
equity bonuses; (ii) ▇▇▇ ▇▇▇▇▇▇ - an amount at least
equal to his 2004 cash and equity bonus annualized
for a full year; (iii) ▇▇▇▇
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▇'▇▇▇▇▇▇▇ - at least 25% of his 2005 annualized
salary in cash; (iv) ▇▇▇▇▇▇ ▇▇▇▇ - at least 25% of
his 2005 annualized salary in cash; (v) ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ - an amount at least equal to his 2004 cash
bonus annualized for a full year multiplied by a
fraction with the numerator being the number of
business days he works during 2005, if any, and the
denominator being 235; and (vi) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇ ▇▇▇▇▇▇▇ - each to be paid a cash bonus at least
equal to 50% of their combined 2004 cash bonuses.
Such bonuses shall be paid on or before January 15,
2006. Additionally, the Company shall award to each
of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇ 4,500 shares of
BKF stock, such stock award shall be separate from
and outside of the Group Minimum Bonus Compensation
Pool and shall vest and be delivered to them in equal
tranches on December 31, 2005, 2006 and 2007,
respectively, so long as they do not resign and are
not terminated for cause prior to such dates. In the
event a Separate Group Member is terminated without
cause, dies or terminates employment due to a
long-term disability, he/she shall be paid, within
thirty days of such termination date, a 2005 cash
bonus in an amount at least equal to the amount
he/she would have been paid had he/she not been
terminated without cause, died or terminated due to a
disability (and with respect to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇ ▇▇▇▇▇▇▇, they shall at the same time be vested
in and distributed their aforesaid BFK shares to the
extent not already done).
(j) The Subsequent Group Members and Separate Group
Members are collectively referred to herein as the
"Other Group Members." The parties to this Agreement
acknowledge and agree that a reason this Agreement is
being entered into is to induce ▇▇▇▇▇▇, the Group
Members and other Group Members to remain with the
Company, and that, as such, ▇▇▇▇▇▇, the Group Members
and other Group Members are intended to be, and are,
third party beneficiaries to this Agreement, and thus
have the right to enforce this Agreement. Such
third-party beneficiary rights shall cease if any
such individual enters into a separate agreement with
the Company which specifically acknowledges the
cessation of such rights.
(k) Any terminations from or new hires to the Group, or
any changes to any Group Member's or Other Group
Member's base salary, made by the Company in 2005
after the date hereof shall not adversely affect any
Group Member's, Other Group Member's, Separate Group
Member's or Subsequent Group Member's right, if any,
to (i) participate in the Group Minimum Bonus
Compensation Pool or (ii) receive severance benefits
as provided hereunder
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unless, if Employee is then still employed by the
Company, Employee consents thereto.
(l) To the extent the Company does not timely and fully
make the aforesaid Group Minimum Compensation Pool
payment and other payments/awards set forth herein,
in whole or in part, it is agreed that such failure
shall increase the Group Minimum Compensation Pool
by: (i) interest at the rate and in the manner set
forth in the New York C.P.L.R. for a breach of
contract (from December 31, 2005, until the date
paid); and (ii) 25% of the unpaid principal
amount(s), and the Company shall also pay all
reasonable attorneys' fees and costs incurred in
connection with efforts by Employee and/or others to
be paid such compensation.
B. UPON TERMINATION OF EMPLOYMENT.
(a) QUALIFYING TERMINATION - SEVERANCE. If on or prior to
December 31, 2005, the employment of Employee shall terminate pursuant to a
Qualifying Termination, then the Company shall provide to Employee, within ten
(10) days following the Date of Termination, a lump-sum cash amount equal to the
sum of: (A) Employee's unpaid base salary through December 31, 2005; (B) the
amount of Employee's 2004 cash bonus plus $700,000; and (C) any accrued and
unused vacation pay. Similarly, if on or prior to December 31, 2005, the
employment of ▇▇▇▇▇▇ shall terminate pursuant to a Qualifying Termination, then
the Company shall provide to ▇▇▇▇▇▇, within ten (10) days following the Date of
Termination, a lump-sum cash amount equal to the sum of: (A) ▇▇▇▇▇▇'▇ unpaid
base salary through December 31, 2005; (B) the amount of ▇▇▇▇▇▇'▇ 2004 cash
bonus plus $700,000; and (C) any accrued and unused vacation pay.
(b) QUALIFYING TERMINATION - BENEFITS. If, on or prior to
December 31, 2005, the employment of Employee shall terminate pursuant to a
Qualifying Termination, the Company shall continue to provide, for a period of
eighteen months following Employee's Date of Termination, Employee (and
Employee's dependents, if applicable) with the same level of medical and life
insurance benefits upon substantially the same terms and conditions (including
contributions required by Employee for such benefits) as existed immediately
prior to Employee's Date of Termination; PROVIDED, that if Employee cannot
continue to participate in the Company plans providing such benefits, the
Company shall otherwise provide such benefits on the same after-tax basis as if
continued participation had been permitted. Notwithstanding the foregoing, in
the event Employee becomes reemployed with another employer and becomes eligible
to receive welfare benefits from such employer, the welfare benefits described
herein shall be secondary to such benefits during the period of Employee's
eligibility, but only to the extent that the Company reimburses Employee for any
increased cost and provides any additional benefits necessary to give Employee
the benefits provided hereunder.
(c) NONQUALIFYING TERMINATION. If on or prior to December
31, 2005, the employment of Employee shall terminate other than by reason of a
Qualifying
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Termination, then the Company shall pay to Employee within thirty (30) days
following the Date of Termination, a lump-sum cash amount equal to the sum of:
(i) Employee's base salary through the Date of Termination; and (ii) any accrued
vacation pay, in each case to the extent not theretofore paid.
C. COUNSEL FEES. The Company shall promptly and directly
pay the legal fees incurred by Employee in connection with the negotiation of
this Agreement, up to $35,000, upon presentation of an invoice for same.
3. WITHHOLDING TAXES. The Company may withhold from all payments
due to Employee (or his beneficiary or estate) hereunder all taxes which, by
applicable federal, state, local or other law, the Company is required to
withhold therefrom and any additional amounts which the Employee has agreed to
have withheld.
4. REIMBURSEMENT OF EXPENSES. If any contest or dispute shall
arise under this Agreement involving termination of Employee's employment with
the Company or involving the failure or refusal of the Company to perform fully
in accordance with the terms hereof, the Company shall reimburse Employee, on a
current basis for all reasonable legal fees and expenses, if any, incurred by
Employee in connection with such contest or dispute (regardless of the result
thereof); PROVIDED that Employee shall be required to repay any such amounts to
the Company unless Employee prevails on any material issue which is a subject of
such contest or dispute.
5. PROTECTION OF THE FIRM'S INTERESTS.
(a) Confidentiality. As a condition of his employment,
the Employee shall be required to execute the Company's standard proprietary
inventions and confidentiality agreement. In addition, the Employee recognizes
that the services to be performed by him hereunder are special, unique and
extraordinary in that, by reason of his employment hereunder, he may acquire
confidential information and trade secrets concerning the operation of the
Company or its affiliates or subsidiaries, the use or disclosure of which could
cause the Company or its affiliates or subsidiaries substantial losses and
damages which could not be readily calculated and for which no remedy at law
would be adequate. Accordingly, the Employee covenants and agrees that he will
not at any time, except in performance of his obligations hereunder, or with the
prior written consent of the Board, or as otherwise required by law, directly or
indirectly disclose to any person any secret or confidential information that he
may learn or has learned by reason of his association with the Company, or any
of its predecessors, subsidiaries and affiliates. The term "CONFIDENTIAL
INFORMATION" means any information not previously disclosed or otherwise
available to the public or to the trade with respect to the Company's, or any of
its predecessors', affiliates' or subsidiaries' products, facilities and
methods, trade secrets and other intellectual property, systems, procedures,
manuals, confidential reports, product price lists, customer lists, financial
information, business plans, prospects or opportunities. Nothing herein shall
preclude Employee from disclosing such confidential information necessary to
receive advice from his lawyers, accountants and tax advisers.
(b) Exclusive Property. The Employee confirms that all
confidential information is and shall remain the exclusive property of the
Company, its affiliates and
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subsidiaries. All business records, papers and documents kept or made by the
Employee relating to the business of the Company, its predecessors, affiliates
and subsidiaries shall be and remain the property of the Company. Upon the
termination of his employment with the Company or upon the request of the
Company at any time, the Employee shall promptly deliver to the Company, and
shall not without the consent of the Board retain copies of, any written
materials not made available to the public, or records and documents made by the
Employee or coming into his possession concerning the business or affairs of the
Company or any of its affiliates or subsidiaries.
(c) During the Employee's employment with the Company and
after a resignation by the Employee without Good Reason, Employee shall not,
through December 31, 2005 (the "Restricted Period"), whether as owner, part
owner, shareholder, partner, member, director, officer, trustee, employee, agent
or consultant, or in any other capacity, on behalf of himself or any "Person"
(as defined below) other than the Company or its "Affiliates" (as defined
below):
(i) directly or indirectly solicit or induce any
Person for the purpose of (A) causing any funds (other than
funds of which Employee and/or members of his Immediate Family
are the sole beneficial owners) with respect to which the
Company or its Affiliates provides Investment Management
Services to be withdrawn from such management, or (B) causing
any "Client" (as defined below), including any Potential
Client, not to engage the Company or any of its Affiliates to
provide Investment Management Services for any additional
funds; provided, however, that this clause (i)(B) shall not be
applicable to Clients (including Potential Clients) who are
also members of the Immediate Family of Employee;
(ii) directly or indirectly solicit or induce any
Past Client on behalf of any Person other than the Company or
its Affiliates for the purpose of providing Investment
Management Services; provided, however, that this clause (ii)
shall not be applicable to Past Clients who are also members
of the Immediate Family of Employee; or
(iii) (A) directly or indirectly solicit or
induce, or attempt to solicit or induce any employee or agent
of, or consultant to, the Company or any of its Affiliates to
terminate its, his or her relationship therewith, (B) hire any
employee, external researcher or similar agent or consultant,
or former employee, external researcher or similar agent or
consultant of the Company or any of its Affiliates who was
employed by or acted as an external researcher or similar
agent or consultant of the Company or its Affiliates at any
time during the one (1) year period preceding such hiring of
such Person or (C) work in any enterprise involving Investment
Management Services with any employee, external researcher or
similar agent or consultant or former employee, external
researcher or similar agent or consultant, of the Company or
its Affiliates who was employed by or acted as an agent or
consultant to the Company or its Affiliates at any time during
the one (1) year period preceding the termination of
Employee's
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employment (excluding for all purposes of this sentence,
secretaries and persons holding other similar positions).
For purposes of this Section 5,
the term "Past Client" shall mean at any particular time, any Person who at any
point prior to such time is known to the Employee to have been an advisee or
investment advisory customer of, or otherwise a recipient of Investment
Management Services from, the Company or any of its Affiliates, but at such time
is not an advisee or investment advisory customer or client of, or recipient of
Investment Management Services from the Company or any of its Affiliates;
provided however, that the term "Past Client" shall be limited to those Past
Clients who were recipients of Investment Management Services, directly or
indirectly, from the Company or its Affiliates at the date of termination of
Employee's employment or at any time during the one (1) year immediately
preceding the date of such termination;
the term "Potential Client" shall mean, at any particular time, any Person to
whom the Company or any of its Affiliates, or any director, officer employee,
agent or consultant (or persons acting in any similar capacity) of the Company
or any such Affiliate (acting on its behalf), has, to the knowledge of the
Employee, within one (1) year prior to such time, offered (whether by means of a
personal meeting or by telephone call, letter, written proposal or otherwise) to
provide Investment Management Services, but who is not at such time an
investment advisory customer of, or otherwise a recipient of Investment
Management Services from, the Company or any of its Affiliates (directly or
indirectly). The preceding sentence is meant to exclude (i) advertising, if any,
through mass media in which the offer, if any, is available to the general
public, such as magazines, newspapers and sponsorships of public events and (ii)
"cold calls" and mass-mailing form letters, in each case to the extent not
directed towards any particular Person and not resulting in an indication of
interest or a request for further information;
the term "Present Client" shall mean, at any particular time, any Person who is,
to the knowledge of the Employee, at such time an advisee or investment advisory
customer of, or otherwise a recipient of Investment Management Services from,
the Company or its Affiliates (directly or indirectly);
the term "Client" shall mean all Past Clients, Present Clients and Potential
Clients, subject to the following general rules: (i) with respect to each
Client, the term shall also include any Persons which are known to Employee to
be Affiliates of such Client, directors, officers or employees of such Client or
any such Affiliates thereof, or Persons who are members of the Immediate Family
of any of the foregoing Persons or Affiliates of any of them; (ii) with respect
to any Client that is a collective investment vehicle (provided that, for the
avoidance of doubt, a 401(k) retirement plan shall not itself be considered a
"collective investment vehicle" except to the extent Employee (as applicable)
has actual knowledge of the identities of investors therein), the term shall
also include any investor or participant in such Client; and (iii) with respect
to any Client that is a trust or similar entity, the term shall include the
settler and each of the beneficiaries of such Client and the Affiliates and
Immediate Family members of any such Persons (and, for the avoidance of doubt,
the Company will provide Employee with a list of "Clients" within five business
days following Employee's termination of employment during the term hereof);
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the term "Immediate Family" shall mean, with respect to any individual, such
individual, the individual's spouse; the descendants (natural or adoptive, of
the whole or half blood) of such individual, such individual's spouse and the
parents (natural or adoptive) of such individual or such individual's spouse;
the grandparents and parents (natural or adoptive) of such individual or such
individual's spouse; the aunts and uncles of such individual or such
individual's spouse; and the siblings and their children (natural or adoptive)
of such individual or such individual's spouse;
the term "Investment Management Services" shall mean any services (including
sub-advisory services) which involve (a) the management of an investment account
or fund (or portions thereof or a group of investment accounts or funds) of any
Person other than the Company or its Affiliates for compensation and (b) the
rendering of advice with respect to the investment and reinvestment of assets or
funds (or any group of assets or funds) of any Person other than the Company or
any of its Affiliates for compensation, and performing activities related or
incidental thereto;
the term "Person" shall mean any individual, corporation, partnership, joint
venture, association, joint-stock company, business trust, limited liability
company, trust, unincorporated organization or government or a political
subdivision, agency or instrumentally thereof or other entity or organization of
any kind; and
the term "Affiliate" shall mean, with respect to any Person, any other Person
which directly or indirectly controls, is controlled by, or is under common
control with that first Person. For purposes of this definition, "control" of a
Person shall mean the power, direct or indirect, to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting stock, by contract, or otherwise.
Notwithstanding the provisions of this Section 5, Employee may following the
termination of his employment during the Restricted Period make passive personal
investments in an enterprise which is competitive with the Company or its
Affiliates, the shares or other equity interests of which are publicly traded;
provided, his holdings therein, together with any holdings of his Affiliates and
members of his Immediate Family, are less than three percent (3%) of the
outstanding shares or comparable interests in such entity.
For the avoidance of doubt, notwithstanding the provisions of this Section 5,
the Employee shall not be subject to the restrictions set forth in this Section
5(c) of this Agreement following his Termination Without Cause, his Termination
With Cause, his Termination due to Disability, or his Resignation With Good
Reason. Moreover, the Employee shall not be subject to any of the restrictions
set forth in this Section 5(c) of this Agreement following the expiration of
this Agreement -- to wit December 31, 2005.
Upon any knowing, material violation of this Section 5, the Company shall have
no further obligations to Employee hereunder.
INJUNCTIVE RELIEF. Without intending to limit the remedies available to the
Company, the
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Employee acknowledges that a breach of any of the covenants contained in this
Section 5 may result in material irreparable injury to the Company or its
affiliates or subsidiaries for which there is no adequate remedy at law, that it
will not be possible to measure damages for such injuries precisely and that, in
the event of such a breach or threat thereof, the Company, its affiliates or
subsidiaries, shall be entitled to seek a temporary restraining order and/or a
preliminary or permanent injunction restraining the Employee from engaging in
activities prohibited by this Section 5 or such other relief as may be required
to specifically enforce any of the covenants in this Section 5.
6. SCOPE OF AGREEMENT. Nothing in this Agreement shall be deemed
to entitle Employee to continued employment with the Company or its
Subsidiaries; PROVIDED, that any termination of Employee's employment shall be
subject to all of the provisions of this Agreement.
7. NO MITIGATION. In no event shall Employee be obligated to seek
other employment or take other action by way of mitigation of the amounts
payable to Employee under any of the provisions of this Agreement and, except as
may be provided in Section 3(B)(b), such amounts shall not be reduced whether or
not Employee obtains other employment.
8. INDEMNIFICATION. The Company shall indemnify and hold Employee
harmless for against and for any and all costs, expenses, liabilities, losses,
fees (including without limitation attorneys' and/or other professional fees,
disbursements and charges), awards, judgments, penalties, fines, verdicts,
taxes, penalties, sanctions and interests, arising out of any and all acts
and/or omissions, or claimed acts and/or omissions, in his capacity as an
officer, director, manager, agent, representative, member and/or employee of the
Company, to the maximum extent permitted under the greater of: (a) any Company
corporate governance document (such as a bylaw or articles of incorporation); or
(b) applicable law. Employee shall further be entitled to a prompt advancement
of any and all reasonable costs, expenses, disbursements, and fees (including
without limitation attorneys' and/or other professional fees, disbursements and
charges) incurred or to be incurred by him in connection with an actual or
threatened civil, criminal, regulatory, arbitral, governmental, administrative
and/or other action of other proceeding, or investigation, arising out of any
and all acts and/or omissions, or claimed acts and/or omissions, in his capacity
as an officer, director, manager, agent, representative, member and/or employee
of the Company in accordance with Company policy. The Company shall also
maintain a Director's and Officer's Liability Insurance Policy which shall
provide liability coverage for Employee's benefit, on terms no less favorable to
him in any respect than the coverage provided to any other officer, director,
manager, agent, representative, member or employee of the Company of similar
status, and the Employee shall remain covered under such policy for so long as
Employee is employed by the Company and for such period after his Date of
Termination as provided to other similarly situated employees of the Company
from time to time. Nothing in this Agreement shall operate to limit or
extinguish any rights (whether to indemnification, contribution, or otherwise)
that Employee may otherwise have (including without limitation under any
agreement or under the law).
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9. SUCCESSORS; BINDING AGREEMENT.
(a) This Agreement shall not be terminated by any
business combination to which the Company is a party ("Business Combination").
In the event of any Business Combination during the Term, the provisions of this
Agreement shall be binding upon the Surviving Corporation, and such Surviving
Corporation shall be treated as the Company hereunder.
(b) The Company agrees that in connection with any
Business Combination during the Term, it will cause any successor entity to the
Company unconditionally to assume (and for any Parent Corporation in such
Business Combination to guarantee), by written instrument delivered to Employee
(or his beneficiary or estate), all of the obligations of the Company hereunder.
Failure of the Company to obtain such assumption and guarantee prior to the
effectiveness of any such Business Combination shall be a breach of this
Agreement and shall constitute Good Reason hereunder and shall entitle Employee
to compensation and other benefits from the Company in the same amount and on
the same terms as Employee would be entitled hereunder if Employee's employment
were terminated without Cause or for Good Reason. For purposes of implementing
the foregoing, the date on which any such Business Combination becomes effective
shall be deemed the date Good Reason occurs, and shall be the Date of
Termination if requested by Employee.
(c) This Agreement shall inure to the benefit of and be
enforceable by Employee's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If
Employee shall die while any amounts would be payable to Employee hereunder had
Employee continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement to such person or
persons appointed in writing by Employee to receive such amounts or, if no
person is so appointed, to Employee's estate.
10. NOTICE
(a) For purposes of this Agreement, all notices and other
communications required or permitted hereunder shall be in writing and shall be
deemed to have been duly given when delivered or five (5) days after deposit in
the United States mail, certified and return receipt requested, postage prepaid,
addressed as follows:
If to the Employee:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇. ▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
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With a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Wechsler & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
If to the Company:
▇▇▇▇▇ Management Co., Inc
▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
(b) A written notice of Employee's Date of Termination by
the Company or Employee, as the case maybe, to the other, shall (i) indicate the
specific termination provision in this Agreement relied upon, (ii) to the extent
applicable, set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of Employee's employment under the provision
so indicated and (iii) specify the termination date (which date shall be not
less than fifteen (15) days (thirty (30) days, if termination is by the Company
for Disability) nor more than sixty (60) days after the giving of such notice).
The failure by Employee or the Company to set forth in such notice any fact or
circumstance which contributes to a showing of Good Reason or Cause shall not
waive any right of Employee or the Company hereunder or preclude Employee or the
Company from asserting such fact or circumstance in enforcing Employee's or the
Company's rights hereunder.
11. FULL SETTLEMENT. The Company's obligation to make any payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall be in lieu and in full settlement of all other severance
payments to Employee under any other severance or employment agreement between
Employee and the Company, and any severance plan of the Company. The Company's
obligations herein shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim or action which the Company may have against
Employee or others, except with respect to any claim, obligation, right or
action which arises during the term hereof.
12. RESOLUTION OF DISPUTES. All claims by the Employee for
benefits under this Agreement shall first be directed to and determined by the
Board and shall be in writing. Any denial by the Board of a claim for benefits
under this Agreement shall be delivered to the Employee in writing and shall set
forth the specific reasons for the denial and the specific provisions of this
Agreement relied upon. The Board shall afford a reasonable opportunity to the
Employee for a review of the decision denying a claim and shall further allow
the Employee to appeal to the Board a decision by the Board within sixty (60)
days after notification by the Board that the Employee's claim has been denied.
Thereafter, any disputes shall be submitted for
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resolution, on expedited basis, to the American Arbitration Association ("AAA"),
to be decided by the three arbitrators in New York, New York. New York law shall
govern any such dispute, and the AAA rules governing employment disputes shall
control and be applied. The Company shall be responsible for and pay any and all
AAA (including arbitrator) fees in excess of those normally charged in a
judicial proceeding filed in the New York Supreme Court. The parties shall bear
their own legal fees. The award may be confirmed in any New York state or
federal court of competent jurisdiction.
13. EMPLOYMENT WITH SUBSIDIARIES. Employment with the Company for
purposes of this Agreement shall include employment with, any Subsidiary.
14. SURVIVAL. The respective obligations and benefits afforded to
the Company and Employee as provided herein, as applicable, shall survive the
termination of this Agreement.
15. GOVERNING LAW; VALIDITY. THE INTERPRETATION, CONSTRUCTION AND
PERFORMANCE OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF, OF SUCH PRINCIPLES OF ANY OTHER
JURISDICTION WHICH COULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION
OTHER THAN THE STATE OF NEW YORK. THE INVALIDITY OR UNENFORCEABILITY OF ANY
PROVISION OF THIS AGREEMENT SHALL NOT AFFECT THE VALIDITY OR ENFORCEABILITY OF
ANY OTHER PROVISION OF THIS AGREEMENT, WHICH OTHER PROVISIONS SHALL REMAIN IN
FULL FORCE AND EFFECT.
16. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original and all of which together shall
constitute one and the same instrument.
17. MISCELLANEOUS. No provision of this Agreement may be modified
or waived unless such modification or waiver is agreed to in writing and signed
by Employee and by a duly authorized officer of the Company. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. Failure by Employee
or the Company to insist upon strict compliance with any provision of this
Agreement or to assert any right Employee or the Company may have hereunder,
including, without limitation, the right of Employee to terminate employment for
Good Reason, shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement. Except as otherwise specifically
provided herein, the rights of, and benefits payable to, Employee, his estate or
his beneficiaries pursuant to this Agreement are in addition to any rights of,
or benefits payable to, Employee, his estate or his beneficiaries under any
other employee benefit plan or compensation program of the Company.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by a duly authorized officer of the Company and Employee has executed
this Agreement as of the day and year first above written.
▇▇▇▇▇ MANAGEMENT CO., INC
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President, General Counsel
and Secretary
BKF CAPITAL GROUP, INC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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