October 26, 2006 Mr. Lewis A. Sanders AllianceBernstein Corporation New York, NY 10105 Dear Lew:
EXHIBIT
99.31
October
26, 2006
Xx.
Xxxxx
X. Xxxxxxx
AllianceBernstein
Corporation
0000
Xxxxxx xx xxx Xxxxxxxx
New
York,
NY 10105
Dear
Xxx:
This
letter, which sets forth the terms of your agreement with AllianceBernstein
Corporation (the “Company”)
and
AllianceBernstein L.P. (the “Partnership”),
has
been duly reviewed and approved by the Compensation Committee of the Board
of
Directors of the Company (the “Board”).
1. Position
and Responsibilities.
You will continue to serve as Chairman
of the Board and Chief
Executive Officer
of the Company until December 31, 2011.
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2.
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Compensation.
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(a) Base
Salary.
During the term of your employment, you will be entitled to receive a minimum
base salary of $275,000 per year, or such greater amount as shall be determined
on an annual basis by the Compensation Committee of the Board. Your base salary
shall be payable in bi-weekly installments or otherwise in accordance with
the
Partnership’s payroll practices in effect from time to time.
(b) Deferred
Compensation Awards.
(i) Except as provided in Section 6 hereof, for calendar year 2006
and for
each subsequent calendar year during the term of your employment, the
Partnership will make a deferred compensation award to you of
not
less than one percent (1%) of the Partnership’s consolidated operating income
before incentive compensation (as defined with respect to the calculation of
the
Partnership’s bonus pool) for such calendar year,
which
shall vest in annual installments at the rates applicable to each award
following the grant date of the award, with such vesting to occur on December
1
of each year, and be distributed to you thereafter with earnings as provided
in
(ii) below unless you elect to defer payment. For
years
2006, 2007 and 2008, each award shall vest over two years as
follows:
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2006
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2007
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2008
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First
Year
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65%
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75%
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85%
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Second
Year
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35%
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25%
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15%
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The
award
in 2009, and in each subsequent year, will vest after one year. (ii) The
deferred compensation awards shall be treated as notionally invested in such
Approved Funds as selected by you from time to time based on procedures
established by the Partnership. Approved Funds shall mean any money market,
debt
or equity fund sponsored by the Partnership or its affiliates and designated
by
the Partnership from time to time.
3. Benefits.
During the term of your employment, you and your eligible dependents shall
continue to participate in the Partnership’s benefit plans and programs,
including group health, dental and life insurance. You shall also continue
to
participate in, contribute to or accrue benefits under the Partnership’s profit
sharing plan.
4. Perquisites
and Expenses.
During the term of your employment, you will be entitled to perquisites,
including use of the Partnership’s leased or owned aircraft, on the same terms
and conditions as other senior executives, and you will also be entitled to
the
services of a chauffeur in connection with your services to the Company and
the
Partnership. In addition, the Partnership will reimburse you for all reasonable
business-related expenses incurred by you, in accordance with the Partnership’s
policies and procedures.
5. Office
and Support Staff.
During the term of your employment, the Partnership will make available to
you
at its New York headquarters such office space and other assistance as is
consistent with your position, responsibilities and duties. In addition to
the
foregoing, the Partnership will provide you with a staff with compensation
and
abilities commensurate with your current staff.
6. Termination
of Employment.
The Partnership may terminate your employment hereunder at any time with or
without cause.
(a) Termination
by the Partnership without Cause.
In
the event of a termination of your employment by the Partnership without Cause
(as defined below), you shall be entitled to receive (i) the base salary that
would otherwise have been payable to you pursuant to Section 2(a) had you
remained employed through the later of December 31, 2007 or the end of the year
in which your employment terminates, to the extent not previously paid, (ii)
a
pro-rata deferred compensation award for the calendar year in which such
termination occurs (calculated in
accordance with Section 2(b) hereof based
on
the Partnership’s consolidated income before incentive compensation through the
last day of your employment),
(iii)
all unvested deferred compensation awards (including any pro-rata award made
to
you in accordance with clause (ii) hereof) made to you under Section 2(b) hereof
prior to the termination of your employment, (iv) comparable health and welfare
benefits for yourself, your spouse and your dependents through the later of
December 31, 2007 or the end of the year in which your employment terminates,
(v) if the termination occurs prior to December 31, 2007, a lump sum cash
payment equal to the product of $20,000 times the number of plan years through
and including 2007 for which you will not receive a Partnership contribution
to
your account under the tax-qualified Profit Sharing Plan for Employees of
AllianceBernstein L.P. as a result of your termination, and (vi) if the
termination occurs prior to December 31, 2007, continuation of the perquisites,
reimbursements and support provided under Section 4 hereof until December 31,
2007. The amounts payable under clauses (i) and (v) above shall be distributed
to you within 90 days after the termination of your employment, and the amount
under clause (iii) above shall be distributed to you on the first business
day
following six (6) months after the termination of your employment.
(b) Termination
by the Partnership for Cause.
In
the event of a termination of your employment for Cause (as defined below),
you
shall be entitled to receive (i) the pro rata portion of your base salary for
services rendered to the date of termination, to the extent not previously
paid,
(ii) all deferred compensation awards made to you under Section 2(b) hereof
that
have vested prior to the termination of your employment, and you shall not
be
entitled to any further benefits or payments hereunder. For purposes of this
agreement, “Cause”
means
(i) your continuing willful failure to perform your duties hereunder (other
than
as a result of total or partial incapacity due to physical or mental illness),
following at least 30 days’ written notice to you, which specifies the details
of such failure, and a reasonable opportunity to cure, (ii) your engaging in
any
conduct which a court or other governmental body with proper jurisdiction finds
(A) constitutes an employment disqualification under applicable law (including
the Securities Exchange Act of 1934) or a felony under the laws of the United
States or any state thereof and which is materially and demonstrably injurious
to the business or the reputation of the Partnership, or (B) a material
violation of federal or state securities law, (iii) in the absence of a finding
by a court or other governmental body with proper jurisdiction that a felony
or
employment disqualification described in (ii)(A) or a violation described in
(ii)(B) has occurred, a determination in good faith by the Board that an act
or
acts by you constitutes such a felony or employment disqualification or
violation, and that the continued employment of you by the Partnership would
be
materially and demonstrably injurious to the business or the reputation of
the
Partnership or (iv) breach of the provisions of Section 7(a) or Section 7(b)
hereof, which breach is material to the business of the Partnership.
(c) Resignation
and Retirement.
In the event of your resignation prior to January 1, 2011, you shall be entitled
to receive the pro rata portion of your base salary for services rendered to
the
date of termination, to the extent not previously paid, all deferred
compensation awards made to you under Section 2(b) hereof that have vested
prior
to the termination of your employment, and you shall not be entitled to any
further benefits or payments hereunder; provided, however, that you may elect
to
retire from the Partnership by providing twelve (12) months’ notice to the
Partnership on or after January 1, 2008.
During
the notice period, you shall continue to receive your base salary (as well
as
the other benefits, perquisites, reimbursements and support set forth in
Sections 3, 4 and 5 hereof) and, in lieu of a deferred compensation award
calculated in accordance with Section 2(b) hereof, you shall receive a bonus,
the amount of which will be determined in the discretion of the Compensation
Committee of the Board and consistent with your position and performance. Your
deferred compensation awards shall continue to vest during the notice period
and
the amounts that have vested prior to the termination of your employment shall
be distributed to you on the first business day following six (6) months after
the termination of your employment. Your resignation or retirement will only
be
valid hereunder if effected pursuant to a written notice signed by you and
submitted to the Secretary of the Company for delivery to the
Board.
(d) Termination
due to Death or Disability.
In the event that your employment is terminated due to your death or Disability
(as defined below), you or your estate (as applicable) shall be entitled to
receive the benefits and payments that you would have received under Section
6(a) above had your termination of employment been a termination by the
Partnership without Cause, and you, your spouse and your dependents shall be
entitled to continued health benefits as described in clause (iv) of Section
6(a), provided, however, that neither you, your estate nor your survivors will
be entitled to the payment described in clause (v) of Section 6(a) or the
continuation of the perquisites, reimbursements and support provided under
Section 4 and 5 (and clause (vi) of Section 6(a)) hereof in the event your
employment is terminated due to your death or Disability. Disability shall
mean
a good faith determination by the Partnership that you are physically or
mentally incapacitated and have been unable for a period of six consecutive
months to perform substantially all of the duties for which you are responsible
immediately before the commencement of the incapacity. In order to assist the
Partnership in making such a determination and as reasonably requested by the
Partnership, you will (i) make yourself available for medical examination by
one
or more physicians chosen by the Partnership and approved by you , whose
approval shall not be unreasonably withheld, (ii) grant the Partnership and
any
such physicians access to all relevant medical information relating to you,
(iii) arrange to furnish copies of medical records to the Partnership and such
physicians, and (iv) use your best efforts to cause your own physicians to
be
available to discuss your health with the Partnership and its chosen
physicians.
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7.
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Covenants.
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(a) Confidentiality.
You acknowledge that you have acquired and will acquire confidential information
respecting the business of the Partnership and its affiliates. Accordingly,
you
agree that you will not disclose, at any time (during your employment or
thereafter) any such confidential information to any unauthorized third party
without the written consent of the Partnership as authorized by the Board,
(or,
in the case of information pertaining to one of the Partnership’s affiliates,
the Chief Executive Officer of such affiliate) except as required to respond
to
a subpoena or other legal proceeding and except to consult with legal or other
advisors, provided
that
such
advisors agree to be bound by the provisions of this Section 7(a); provided,
that in
the event you are requested pursuant to a subpoena or other legal proceeding
to
disclose any such confidential information, you shall promptly notify the
Partnership of such request and shall fully cooperate with the Partnership
in
any attempt to contest such request. For this purpose, information shall be
considered confidential only if such information is proprietary to the
Partnership and has not been made publicly available prior to its disclosure
by
you.
(b) Non-Competition.
From the date hereof through (i) the later of December 31, 2007 or the
termination of your employment hereunder, or (ii) in the case of a termination
of your employment by the Partnership without Cause prior to December 31, 2007,
through the date of such termination, you will not, without the consent of
the
Board, directly or indirectly, engage in or be interested in (whether as owner,
partner, shareholder, employee, director, officer, agent, consultant or
otherwise), with or without compensation, any business that is in direct
competition with any active business of the Partnership, any successor to the
Partnership’s business, or any of their affiliates or subsidiaries and in which
you participated while you were employed by the Partnership, any successor
to
the Partnership’s business or any of their affiliates or subsidiaries prior to
the date hereof or while you are employed. Nothing in this Section 7(b) shall
prohibit you from acquiring or holding, directly or indirectly, any units in
the
Partnership or not more than 3% of any class of publicly traded securities
of
any business.
(c) Remedy
for Breach and Modification.
You acknowledge that the provisions of this Section 7 are reasonable and
necessary for the protection of the Partnership and that the Partnership will
be
irrevocably damaged if such covenants are not specifically enforced.
Accordingly, you agree that, in addition to any other relief or remedies
available to the Partnership, the Partnership shall be entitled to seek and
obtain an appropriate injunction or other equitable remedy from a court with
proper jurisdiction for the purposes of restraining you from any actual or
threatened breach of such covenants, and no bond or security will be required
in
connection therewith. If any provision of this Section 7 is deemed invalid
or
unenforceable, such provision shall be deemed modified and limited to the extent
necessary to make it valid and enforceable.
(d) Cooperation.
Following any termination of your employment for any reason or upon the
expiration of this agreement, you agree that you will cooperate with the
Company’s and the Partnership’s reasonable requests relating to matters that
pertain to your employment by the Company and the transition of your duties
to
your successor. In addition, following termination of your employment by either
party, you will cooperate with the Company or the Partnership’s reasonable
requests relating to any legal proceedings on behalf of the Company or the
Partnership, or otherwise making yourself reasonably available to the Company
or
the Partnership for other related purposes. Any such cooperation hereunder
will
be performed at times scheduled taking into consideration your other commitments
and the Partnership will reimburse you for your reasonable expenses incurred
in
connection with your cooperation.
8. Indemnification.
During the term of your employment, you shall be an “Indemnified Person” within
the meaning set forth in the Agreement of Limited Partnership of the
Partnership. You shall also be covered by the Partnership’s directors’ and
officers’ liability policy. The foregoing indemnity shall not apply to claims
against you that arise under the terms of this agreement and nothing herein
shall require indemnification for any conduct occurring after the termination
of
your employment.
9. Legal
Rights, Fees and Expenses.
The Partnership will reimburse all reasonable attorneys’ and related fees and
expenses incurred by you in connection with the negotiation of this agreement.
In addition, the Partnership will reimburse all reasonable attorneys’ and
related fees and expenses incurred by you in connection with any dispute
associated with the interpretation, enforcement or defense of your rights under
this agreement unless you have proceeded without substantial merit or good
faith. Nothing contained herein is intended to limit remedies or damages to
which the parties may be entitled for any breach of this agreement either in
law
or in equity.
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10.
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Miscellaneous.
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(a) Governing
Law.
This agreement shall be governed by New York law, without reference to
principles of conflicts of law.
(b) Entire
Agreement; Amendments.
This agreement contains the entire understanding of the parties with respect
to
the subject matter hereof, including the terms and conditions of your continued
employment with the Company and the Partnership, and supercedes any and all
prior agreements and understandings, whether written or oral, among you, the
Company, the Partnership or any affiliate thereof with respect to the subject
matter hereof, including, but not limited to, your agreement dated December
28,
2004. There are no restrictions, agreements, promises, warranties, covenants
or
undertakings between the parties with respect to the subject matter herein
other
than those expressly set forth herein. This agreement may not be altered,
modified, or amended except by written instrument signed by the parties
hereto.
(c) Assignment.
This agreement shall not be assignable by you, and shall be assignable by the
Company or the Partnership only to any affiliate of the Company or the
Partnership or to any corporation or other entity resulting from the
reorganization, merger or consolidation of the Company or the Partnership with
any other corporation or entity or any corporation or entity to or with which
the Company’s or the Partnership’s business or substantially all of its business
or assets may be sold, exchanged or transferred.
(d) Waiver.
The failure of a party to insist upon strict adherence to any term of this
agreement on any occasion shall not be considered a waiver thereof or deprive
that party of the right thereafter to insist upon strict adherence to that
term
or any other term of this agreement.
(e) Severability.
In
the event any provision of this agreement shall be held illegal or invalid
for
any reason, the illegality or invalidity shall not affect the remaining parts
of
the agreement and the agreement shall be construed and enforced as if the
illegal or invalid provision had not been included.
(f) Taxes.
The Partnership shall have the right to deduct from all amounts paid to you
any
taxes required by law to be withheld in respect of payments pursuant to this
agreement.
(g) Arbitration.
Subject to Section 7(c), any dispute arising out of, or relating to, this
agreement shall be resolved by binding arbitration, to be held in the Borough
of
Manhattan in New York City, under the auspices of the American Arbitration
Association and the rulings of such arbiters shall be enforceable by any court
of competent jurisdiction.
(h) Headings.
Section headings are used herein for convenience of reference only and shall
not
affect the meaning of any provision of this agreement.
(i) Notice.
Any notice, consent, request or other communication made or give in connection
with this agreement shall be in writing and shall be deemed to have been duly
given when delivered or mailed by registered or certified mail, return receipt
requested, to those listed below at their following respective addresses or
at
such other address as each may specify by notice to the others:
To
the
Executive:
At
the
address set forth below
To
the
Partnership:
AllianceBernstein
Corporation
0000
Xxxxxx xx xxx Xxxxxxxx
Attention:
Xxxxxxxx X. Xxxxxx
Executive
Vice President and General Counsel
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11.
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Unsecured
Creditor.
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(a) Your
rights to receive the deferred compensation, and earnings thereon, shall be
an
unsecured claim against the general assets of the Partnership. All such
distributions shall be paid from the general funds of the Partnership and no
special or separate fund shall be established and no segregation of assets
shall
be made to assure payments of any such distributions. You shall have no right,
title or interest whatsoever in, or to, any investments which the Partnership
may make to assist it in meeting its obligations hereunder. Nothing contained
herein, and no action taken pursuant hereto, shall create or be construed to
create a trust of any kind or a fiduciary relationship between the Partnership
and you.
(b) Your
right to receive any payment hereunder may not be transferred or assigned,
pledged or otherwise encumbered by you, other than by will, by the applicable
laws of descent and distribution or by a court of competent jurisdiction. Any
other attempted assignment or alienation of any payment hereunder shall be
void
and of no force or effect.
(c) The
provisions hereof are intended to comply with the requirements of Internal
Revenue Code section 409A and the provisions hereof shall be deemed modified
to
the extent necessary to comply herewith.
Sincerely,
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By:
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ALLIANCEBERNSTEIN
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CORPORATION,
its General Partner
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By:
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/s/
Xxxxxx X. Xxxxxxxxx
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Xxxxxx
X. Xxxxxxxxx
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President
and Chief Operating Officer
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AGREED
TO
AND ACCEPTED BY
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/s/
Xxxxx X. Xxxxxxx
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Xxxxx
X. Xxxxxxx
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Date
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Address:
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