EXHIBIT 10.1
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EXECUTION COPY
SEPARATION AGREEMENT
AND GENERAL RELEASE OF ALL CLAIMS
This Separation Agreement and General Release of all Claims (this
"AGREEMENT") is entered into by and among BKF Capital Group, Inc. (together with
its successors and assigns, "BKF"), Xxxxx Management Co., Inc. (together with
its successors and assigns, the "SUBSIDIARY" and together with BKF, the
"Companies") on the one hand and Xxxxx Xxxxx (the "MANAGER") on the other and is
dated as of December 16, 2005 (the "Effective Date").
WHEREAS, the Manager has been employed by the Subsidiary as Senior
Portfolio Manager;
WHEREAS, the Companies and the Manager wish to document the terms upon
which Manager's employment with the Companies is being terminated on a mutually
amicable basis;
THEREFORE, and in consideration of the promises set forth in this
Agreement, the Manager and the Companies (collectively, the "PARTIES" and each,
a "PARTY") hereby agree as follows:
1. ENTIRE AGREEMENT
This Agreement is the entire agreement between the Manager and the
Companies with respect to the subject matter hereof and contains all agreements,
whether written, oral, express or implied, between the Manager and the Companies
directly relating thereto. It also supersedes and extinguishes any and all prior
oral agreements between either Company and the Manager. For the avoidance of
doubt, it does not supercede that certain letter agreement among the Parties and
Xxxxx Rango, dated April 19, 2005 (including the term sheet enclosed therewith
and its Exhibits) (the "TERM SHEET") (collectively, the "COMPENSATION
AGREEMENT"). In that connection, the Parties expressly reaffirm each of the
provisions and commitments set forth in the Compensation Agreement, except to
the extent that they are expressly modified by this Agreement.
2. TERMINATION OF EMPLOYMENT; TRANSITION PERIOD.
A. The Parties hereby agree that any and all appointments the Manager
holds with the Companies or any of their respective affiliates or subsidiaries
(collectively, the "COMPANY GROUP"), whether as employee, consultant, agent or
otherwise, shall cease as of 11:59 p.m. on December 30, 2005 (the "TERMINATION
DATE"). Notwithstanding the foregoing, the Parties further agree that, for
purposes of determining the payments and benefits to which the Manager is
entitled under the Compensation Agreement or otherwise (including, without
limitation, payment of his monthly "Draw," provision of employee benefits, and
payment of amounts due him under Section 4(a) of the Term Sheet), the Manager's
employment shall be treated as having continued through December 31, 2005, and
as having then been terminated by him voluntarily (and under no circumstances by
the Companies, whether with or without "Cause").
B. Notwithstanding anything to the contrary in the Term Sheet, the
Companies represent and warrant that the 2005 compensation for each of the "Team
Members" (as such term is
defined in the Term Sheet) has been established by Xxxxx Rango and that the Team
Members shall receive such amounts for their 2005 compensation.
C. Effective as of the Effective Date, the Manager shall have no
authority to act on behalf of the Companies or any other member of the Company
Group, and shall not hold himself out as having such authority or otherwise act
in a management or other decision making capacity.
3. TERMS OF CERTAIN PAYMENTS AND BENEFITS.
A. The Manager confirms that the 61,583 restricted stock units granted to
him pursuant to a certain Deferred Stock Award Agreement between the Manager and
BKF (the "DSA") have vested, and been settled, in shares of BKF common stock,
and that he elected (and BKF agreed) to satisfy any required tax withholding
obligation with respect to such settlement by having BKF withhold from the
settlement that number of shares of BKF common stock having a fair market value
equal to the amount of such withholding based upon the applicable minimum
withholding rates. The Companies confirm that the shares delivered to the
Manager are fully vested and nonforfeitable, are not subject to direct or
indirect clawback pursuant to the DSA or otherwise, and were distributed to the
Manager pursuant to an effective registration statement filed under the
Securities Act of 1933.
B. The next business day after the expiration of the seven day period in
which the Manager may revoke the release given under Section 9 in accordance
with Section 9.G. of this Agreement, if the Manager has not so revoked the
release, the Companies shall pay to the Manager, by wire transfer to an account
identified by the Manager, the sum of $750,000 as an advance against amounts
that will otherwise be due to the Manager under Section 4 of the Term Sheet.
Unless the Manager has revoked the release given under Section 9 in accordance
with Section 9.G., the Manager shall be entitled to the balance of the amounts
due to him under Section 4 of the Term Sheet no later than Xxxxx Rango is paid
corresponding amounts under such Section. The Manager shall be entitled to
prompt access to the books and records of the Companies, and their affiliates,
sufficient to confirm that the amounts paid under Section 4 of the Term Sheet
have been correctly determined.
C. The Companies confirm that the Manager (i) shall be entitled to a
matching contribution for 2005 under the 401(k) plan and (ii) shall be entitled
to withdraw his personal funds from any of the Subsidiary's investment funds on
terms no less favorable than the withdrawal terms applicable to any other
investor in such funds.
D. For the avoidance of doubt, as of and after the Termination Date, the
Manager shall no longer accrue service credit or have contributions made, either
by the Manager or on his behalf, under any employee benefit plan sponsored by
the Companies in respect of periods commencing on and following the Termination
Date, including without limitation any plan which is intended to qualify under
Section 401(a) of the Internal Revenue Code of 1986, as amended (the "Code").
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4. RETURN OF COMPANY PROPERTY.
The Manager shall return to the Companies, no later than the Termination
Date, all home office equipment, and other physical equipment and property, if
any, that belongs to any member of the Company Group and that is in the
Manager's possession or under his control. In addition, within seven (7) days
following the Effective Date, all telephone and other accounts (if any) being
paid by the Companies on the Manager's behalf shall be terminated, and all
company credit cards (if any) shall be returned to the Companies and canceled.
To the extent any charges are made by the Manager using company accounts or
credit cards after the Effective Date, such charges will be solely the Manager's
responsibility.
5. INDEMNIFICATION; D&O INSURANCE.
For the avoidance of doubt, the provisions of Exhibit C of the Term Sheet
shall survive the execution of this Agreement and shall continue in effect in
accordance with the terms thereof.
6. CONFIDENTIALITY.
A. The Manager agrees that he will not at any time disclose any "trade
secrets" or proprietary or commercially sensitive information of any member of
the Company Group to any third party, and that nothing in this Agreement shall
be interpreted as reducing any common law or statutory obligation of
confidentiality that he may owe to any member of the Company Group.
B. The Manager acknowledges and agrees that certain papers, notes and
documents (in any medium including computer disks) made or compiled by him, or
made available to him, in connection with, and during his employment by, the
Companies may be the property of the Companies, especially to the extent that
they contain "trade secrets" or proprietary or commercially sensitive
information (such materials, to the extent they contain non-public information
are called, collectively, "Documents"). The Manager agrees to return the
originals and all copies of such Documents (other than those protected by
privilege, the attorney work product doctrine, or the like) that are in his
custody or control to the Companies within three (3) business days after the
Effective Date, provided however, that (i) in the case of Documents residing on
Manager's computer, Manager shall provide to the Companies copies of such
Documents or a disk containing copies of such Documents and, thereafter, at the
Companies' election, the Parties shall work together in good faith to ensure
that appropriate measures are taken to ensure the confidentiality of any such
Documents and (ii) legal advisors representing the Manager need not return to
the Companies, and shall be entitled to retain, their files pertaining to
services rendered for the Manager. The Companies will retain such Documents and
provide a copy of them (except for Documents subject to a legal privilege
belonging to one of the Companies) to the Manager within three (3) business days
of receipt of a written request from the Manager in the event of the initiation
of any litigation, proceeding or governmental investigation or action relating
to the Manager's tenure at the Companies.
C. Notwithstanding the foregoing, nothing in this Agreement or elsewhere
shall prevent the Manager from retaining and utilizing: copies of benefits plans
and programs in which the
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Manager retains an interest; other documents relating to the Manager's personal
compensation, investments, benefits, tax obligations, and other obligations; his
desk calendar, rolodex, and the like; office furnishings which are his property
and personal correspondence files; and such other records and documents as may
be approved by the Chief Executive Officer or General Counsel of BKF, such
approval not to be unreasonably withheld. Neither shall anything in this
Agreement or elsewhere be interpreted to prohibit or restrict any person from
testifying, disclosing information, or making truthful statements, in each case
as required by law, including pursuant to any court or government decree and/or
subpoena and/or responding to any inquiry, or from providing testimony about
this settlement or its underlying facts and circumstances to the Securities and
Exchange Commission, the National Association of Securities Dealers, Inc., any
other self-regulatory organization, any other federal or state regulatory
authority, or any other investigatory organization, or from testifying,
disclosing information or making truthful statements in any arbitration,
lawsuit, or governmental proceeding, or from disclosing information that is in
the public domain, or from making any disclosure in confidence to such person's
spouse or to an attorney or other professional for the purpose of obtaining
professional advice.
D. Notwithstanding the provisions of Section 5 of the Term Sheet, the
Manager agrees that, without the Companies' express written approval, he will
not at any time (i) write, be the source of or contribute to any articles,
stories, books, screenplays or any other communication or publicity of any kind
(written or otherwise) or deliver lectures in any way regarding confidential
information of the Company Group or any of its officers, directors, employees
and agents, or (ii) grant any interviews regarding confidential information of
the Company Group or any of its officers, directors, employees and agents.
7. NONDISPARAGEMENT; COMMUNICATION.
A. Notwithstanding the provisions of Section 5 of the Term Sheet, the
Manager agrees that he will not at any time knowingly defame, disparage or
criticize any member of the Company Group or any of their products, services,
finances, financial condition, capabilities or any other material aspect of any
of their businesses, or any person whom the Manager then knows is a former or
existing employee, manager, director or officer of any member of the Company
Group in any medium to any person or entity (any person or entity that is a
beneficiary of any protection set forth in this sentence being a "PROTECTED
PERSON"). The Companies hereby agree to instruct their executives, and the
members of their respective Boards of Directors, not to at any time defame,
disparage, or criticize the Manager or the Manager's capabilities or integrity
in any medium to any person or entity. In addition, the Companies agree that,
upon reasonable request by the Manager, they will use their reasonable
commercial efforts to cause any Protected Person specified by the Manager, who
is at the time a current employee or director of the Companies, not to defame,
disparage, or criticize the Manager or the Manager's capabilities or integrity
in any medium to any person or entity. Notwithstanding the foregoing, nothing in
this Agreement shall prevent the Manager from responding fully and truthfully to
any statement made or action taken by any Protected Person or any Protected
Person from responding fully and
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truthfully to any statement made or action taken by the Manager. The
restrictions in this Section 7.A shall terminate on the third anniversary of the
Effective Date.
B. The Companies and the Manager shall mutually agree as to the timing,
content and other aspects of any press release or other written statement to be
disseminated outside of the Companies concerning the termination of the
Manager's employment by the Companies, provided, however, that any such press
release or written statement shall reflect that the Manager's employment was
terminated on a mutually amicable basis. The Manager shall be provided with an
opportunity to review and comment upon (but not the right to approve) any Form
8-K, or the applicable portion of any Form 10-Q or other securities law filing
relating to the termination of the Manager's employment and/or the subject
matter of this Agreement, prior to the filing of such Form 8-K, 10-Q or other
securities law filing with the Securities and Exchange Commission.
8. COOPERATION.
Notwithstanding the provisions of Section 5 of the Term Sheet, the Manager
agrees to make himself available, at reasonable times and upon reasonable
request by the Chief Executive Officer of the Subsidiary, to consult with the
Company about disputes between the Companies and third parties, or about other
matters pertinent to the Companies, in each case as to which the Manager has
knowledge, subject in each case to such reasonable conditions as the Manager may
reasonably establish. In return, the Companies agree to make their employees
available, at reasonable times and upon reasonable request by the Manager, to
consult with the Manager about disputes between the Manager and third parties,
or about other matters pertinent to the Manager, in each case as to which such
employees have knowledge, subject in each case to such reasonable conditions as
the Companies may reasonably establish. The Companies also will cooperate to
facilitate the Manager's transfer of any assets in personal accounts currently
in the custody of any member of the Company Group to any other institution of
Manager's choosing, provided that no securities (other than U.S. Government
paper) will be transferred from such accounts until after the Termination Date.
For purposes of the preceding sentence, Manager may communicate with Xxxxxx
Xxxxxxxxx and Xxxxx Xxxxxx at any time.
9. ACKNOWLEDGMENT AND RELEASE
A. In consideration of the Companies' execution of this Agreement, the
Manager, for and on behalf of himself and his heirs and assigns (the "MANAGER
RELEASORS"), hereby waives and releases any common law, statutory or other
complaints, claims, charges or causes of action arising out, of or relating in
any way to, the Manager's employment or termination of employment with, or his
serving in any capacity in respect of, any member of the Company Group, both
known and unknown, in law or in equity (collectively, "CLAIMS"), OTHER THAN
Claims arising out of or preserved by this Agreement, which the Manager may now
have or ever had against any member of the Company Group or any shareholder,
employee, director or officer of any member of the Company Group (collectively,
the "COMPANY RELEASEES"), including, without limitation, any such Claim that
constitutes a complaint, charge or cause of action arising out of
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his employment with the Company Group under the Age Discrimination in Employment
Act of 1967 ("ADEA," a law which prohibits discrimination on the basis of age),
the National Labor Relations Act, the Civil Rights Act of 1991, the Americans
With Disabilities Act of 1990, Title VII of the Civil Rights Act of 1964, the
Employee Retirement Income Security Act of 1974, the Family Medical Leave Act,
the Securities Act of 1933, the Securities Exchange Act of 1934, the New York
State Human Rights Law, all as amended; and all other federal, state and local
statutes, ordinances and regulations.
B. In consideration of the Manager's execution of the Agreement, the
Companies, for and on behalf of each of the Company Releasees, hereby waive and
release any Claims, OTHER THAN (x) Claims arising under or preserved by this
Agreement, and (y) Claims that are based on willful misconduct by the Manager,
unless the material facts of which were known (or should have been known) on or
before the Effective Date by the current Chief Executive Officer, Chief
Financial Officer or General Counsel of BKF, or by any member of the Board of
Directors of either of the Companies, which any Company Releasee may now have,
or ever has had, against any Manager Releasor.
C. The Manager and the Companies each acknowledge that they have not
filed any complaint, charge, claim or proceeding against any of the Company
Releasees or the Manager Releasors, respectively, before any local, state or
federal agency, court or other body relating to the Manager's employment or the
termination thereof (each individually a "Proceeding").
D. Each Party (i) covenants that he/it will not initiate, or cause to be
initiated on his/its behalf any Proceeding, and will not participate in any
Proceeding, in each case with respect to any Claim released under Sections 9.A
or 9.B (collectively, "RELEASED CLAIMS"), except as required by law; and (ii)
waives any right he/it may have to benefit in any manner from any relief
(whether monetary or otherwise) attributable to any Released Claim and arising
out of any Proceeding, including any Proceeding conducted by the Equal
Employment Opportunity Commission ("EEOC"). In the event that any Manager
Releasor brings any Released Claim against any Company Releasee, (i) the Manager
shall fully and promptly indemnify such Company Releasee against any and all
loss, liability, judgment, cost or expense resulting therefrom, including
without limitation prompt payment of all attorneys' fees incurred in connection
therewith, and (ii) the Companies' obligations under Section 7.A of this
Agreement shall automatically terminate. In the event that any Company Releasee
brings any Released Claim against any Manager Releasor, (i) the Companies shall
fully and promptly indemnify such Manager Releasee against any and all loss,
liability, judgment, cost or expense resulting therefrom, including without
limitation prompt payment of all attorneys' fees incurred in connection
therewith, and (ii) the Manager's obligations under Section 7.A of this
Agreement shall automatically terminate.
E. Notwithstanding the above, nothing in this Section 9 shall prevent the
Manager from (i) initiating or causing to be initiated on his behalf any
complaint, charge, claim or proceeding against the Companies before any local,
state or federal agency, court or other body challenging
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the validity of the waiver of his claims under ADEA contained in Section 9 of
the Agreement (but no other portion of such waiver); or (ii) initiating or
participating in an investigation or proceeding conducted by the EEOC with
respect to ADEA.
F. The Manager acknowledges that he has been given twenty-one (21) days
from the date of receipt of the Agreement to consider all the provisions of the
Agreement and he does hereby knowingly and voluntarily waive said given
twenty-one (21) day period. THE MANAGER FURTHER ACKNOWLEDGES THAT HE HAS READ
THE AGREEMENT CAREFULLY, HAS BEEN ADVISED BY THE COMPANIES TO CONSULT AN
ATTORNEY AND HAS CONSULTED AN ATTORNEY, AND FULLY UNDERSTANDS THAT BY SIGNING
BELOW HE IS GIVING UP CERTAIN RIGHTS WHICH HE MAY HAVE TO XXX OR ASSERT ANY
RELEASED CLAIM AGAINST ANY OF THE COMPANY RELEASEES, AS DESCRIBED IN THIS
SECTION 9 AND THE OTHER PROVISIONS HEREOF. THE MANAGER ACKNOWLEDGES THAT HE HAS
NOT BEEN FORCED OR PRESSURED IN ANY MANNER WHATSOEVER TO SIGN THE AGREEMENT AND
THE MANAGER AGREES TO ALL OF ITS TERMS VOLUNTARILY.
G. The Manager shall have seven days from the date of his execution of
the Agreement to revoke the release given under this Section 9 with respect to
any and all claims arising under ADEA (but no other portion of Section 9 or any
other provision of the Agreement). If the Manager revokes the release of ADEA
claims as described in the preceding sentence, the Companies shall not be
required to provide the Manager with the payment described in Section 3.B. of
the Agreement.
10. INJUNCTIVE RELIEF
Each Party acknowledges and agrees that the remedy at law available for
breach of his/its obligations under Sections 6.A, 6.D 7.A and 8 of this
Agreement could be inadequate and that damages flowing from such a breach may
not readily be susceptible to being measured in monetary terms. Accordingly,
each Party acknowledges, consents and agrees that, in addition to any other
rights or remedies which any other Party may have at law, in equity or under
this Agreement with respect to a violation of Section 6.A, 6.D 7.A or 8 by any
Party, upon adequate proof of such a violation by a Party, the other Party shall
be entitled to immediate injunctive relief and may obtain a temporary order
restraining any threatened or further breach, without the necessity of proof of
actual damage and without the requirement of posting a bond, from any court with
jurisdiction over the Parties and the matter.
11. MISCELLANEOUS.
A. NOTICES. All notices required or permitted by this Agreement to be
given to any party shall be in writing and shall be delivered personally, or
sent by certified mail, return receipt requested, or by Federal Express or
similar overnight service, prepaid recorded delivery, addressed as follows:
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If to the Manager:
Xxxxx Xxxxx
000 Xxxxx Xxxxxx - Xx. 0X
Xxx Xxxx, Xxx Xxxx 00000
with copies to:
Xxxxxxxx Xxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx
and
Xxxxxxxx Xxxxxxxx & Xxxxxxxxxxx, P.A.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx
If to the Companies:
BKF Capital Group, Inc.
Xxx Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
with copies to:
Xxxxx Management Co., Inc.
Xxx Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
and
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx
and shall be deemed to have been duly given when so delivered
personally or, if mailed or sent by overnight courier, upon delivery; provided,
that, a refusal by a party to accept delivery shall be deemed to constitute
receipt.
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B. TAXES. Each Party shall be responsible for the payment of any and all
required federal, state, local and foreign taxes incurred, or to be incurred, by
such Party in connection with payments and benefits to which it is entitled
under this Agreement or otherwise. Notwithstanding any other provision of this
Agreement or the Compensation Agreement, the Companies may withhold from amounts
payable under this Agreement, or the Compensation Agreement all federal, state,
local and foreign taxes that are required to be withheld by applicable laws and
regulations with respect to any amounts payable, or benefits provided, to the
Manager thereunder at the minimum applicable statutory rate, and report on any
applicable federal, state, local or foreign tax reporting form any income to the
Manager resulting from such amounts or benefits.
C. SEVERABILITY. In the event that any provision of this Agreement is
determined to be invalid or unenforceable, the remaining terms and conditions of
this Agreement shall be unaffected and shall remain in full force and effect. In
addition, if any provision is determined to be invalid or unenforceable due to
its duration and/or scope, the duration and/or scope of such provision, as the
case may be, shall be reduced, such reduction shall be to the smallest extent
necessary to comply with applicable law, and such provision shall be
enforceable, in its reduced form, to the fullest extent permitted by applicable
law.
D. NON-ADMISSION. Nothing contained in this Agreement shall be deemed or
construed as an admission of wrongdoing or liability on the part of the Manager
or on the part of the Companies.
E. NO MITIGATION. The Manager shall not be required to mitigate the
amount of any payment provided for pursuant to this Agreement or the
Compensation Agreement by seeking other employment and, to the extent that the
Manager obtains or undertakes other employment, the payment will not be reduced
by the earnings of the Manager from the other employment.
F. MISCELLANEOUS. All disputes between the Parties shall be resolved in
AAA Arbitration conducted in Manhattan. All expenses (including attorney's fees)
shall be promptly advanced to the Manager, subject to repayment to the extent
the Manager does not substantially prevail. Only a successor to all, or
substantially all, of the business and assets of a Company may succeed to the
rights of such Company under this Agreement. In the event of the Manager's
death, or a judicial determination of his incompetence, references in this
Agreement to Manager shall be deemed, as appropriate, to refer to Manager's
beneficiaries, estate, executor(s), or other legal representative(s). Each of
the Companies guarantees prompt performance by the other Company of such other
Company's obligations to Manager. The Companies represent that they are
collectively authorized, by action of their Boards and of any other person or
entity whose authorization is required, to enter into this Agreement on their
own behalf and on behalf of each member of the Company Group. New York law
governs this Agreement, without regard to choice-of-law principles. No provision
of this Agreement may be amended, nor may any breach of any provisions of this
Agreement be waived, other than by a writing signed by the waiving party (in the
case of a waiver) or all of the Parties (in the case of an amendment).
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G. COUNTERPARTS. This Agreement may be executed by one or more of the
Parties hereto on any number of separate counterparts and all such counterparts
shall be deemed to be one and the same instrument. Each Party hereto confirms
that any facsimile copy of such party's executed counterpart of the Agreement
(or its signature page thereof) shall be deemed to be an executed original
thereof.
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IN WITNESS WHEREOF, the undersigned have executed the Agreement as of the
date first written above.
BKF CAPITAL GROUP, INC.
/s/ Xxxxxx Xxxxxx
---------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President and General Counsel
XXXXX MANAGEMENT CO., INC.
/s/ Xxxxxx Xxxxxx
---------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President and General Counsel
MANAGER
/s/ Xxxxx Xxxxx
---------------------------------
Xxxxx Xxxxx
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