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EXHIBIT 10.8
BROOKE GROUP LTD.
000 X.X. XXXXXX XXXXXX, 00XX XXXXX
XXXXX, XX 00000
July 20, 1998
Xx. Xxxxxxx X. XxXxx
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxx Xxxxxx, XX 00000
Dear Xx. XxXxx:
This letter agreement sets forth the first amendment to the Employment
Agreement dated as of February 21, 1992 (the "Employment Agreement"), between
Brooke Group Ltd. and Xxxxxxx X. XxXxx.
1. The Employment Agreement is amended by deleting Sections 4(a) and
4(b) thereof and substituting therefor the following:
(a) BASE SALARY.
During the Employment Period, the Company shall pay the
Executive a salary (the "Base Salary") at the rate of $950,000 per
annum. The Base Salary due the Executive hereunder shall be payable in
accordance with the Company's normal payroll practices in equal
installments less any amounts required to be withheld by the Company
from such Base Salary pursuant to the benefit plans described in
Section 3(e) hereof and the applicable laws and regulations described
in Section 10(e) hereof. The Board shall periodically review such Base
Salary and may increase it (but not decrease it below the Base Salary
earned in 1994) from time to time, in its sole discretion. As of
January 1, 1998, the Base Salary is $1,391,601.
(b) MINIMUM BONUS.
During the Employment Period, the Company shall pay to the
Executive a minimum annual bonus (the "Minimum Bonus") equal to 50% of
his (then) current Base Salary, payable in accordance with the
Company's normal payroll practices in equal installments, less any
amounts required to be withheld by the Company from such Minimum Bonus
pursuant to the applicable laws and regulations described in Section
10(e) hereof.
2. The Employment Agreement is amended by inserting the following as
the third sentence of Section 10(e):
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Xx. Xxxxxxx X. XxXxx
July 20, 1998
Page 2
Notwithstanding anything in this Agreement to the contrary,
payments hereunder of salary, bonus or other payments shall be subject
to those limitations, if any, contained in that certain Indenture,
dated as of January 1, 1996, as it may be amended from time to time,
between BGLS Inc. and State Street Bank and Trust Company (as successor
to Fleet National Bank of Massachusetts), as Trustee, relating to the
15.75% Senior Secured Notes due 2001, which limit or purport to limit
the salary, bonus or other payments which may be made by the Company or
any of its affiliates to the Executive or any of his affiliates.
Payments due hereunder which are not made by virtue of such limitations
shall be made at the earliest possible time in such a manner so as not
to violate such limitations. To the extent any payment hereunder is
made in violation of such limitations, the Executive shall hold the
amount of such payment in trust for the Company and shall return it to
the Company upon a final, non-appealable determination by a court of
competent jurisdiction that the payment of such amount, if retained by
the Executive, would violate such limitations.
3. This letter agreement constitutes an amendment to and a modification
of the Employment Agreement and shall for all purposes be considered a part of
the Employment Agreement. Except as amended hereby, the Employment Agreement is
confirmed and ratified in all respects and shall remain in full force and
effect.
Please indicate your agreement with the foregoing by countersigning two
copies of this letter agreement in the space provided below and returning one of
such copies to us.
Very truly yours,
BROOKE GROUP LTD.
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Executive Vice President
The foregoing letter agreement
is consented and agreed to as
of the date first above written.
By: /s/ Xxxxxxx X. XxXxx
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Xxxxxxx X. XxXxx
