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Exhibit
10.2
Gregory H.
Sachs
1890 Robinwood Lane
Riverwoods, Illinois 60015
Sachs Capital Management LLC
Spensyd Asset Management
LLLP
c/o Redleaf Management Company,
LLC
8750 W. Bryn Mawr, Suite
620E
Chicago, Illinois 60631
December 17,
2007
Re: Termination of Employment and Waiver of Put
Rights
Gentlemen:
Reference is made to (i) the Employment Agreement, dated as
of June 26, 2004 (as amended, supplemented or otherwise modified
from time to time, the “ Employment Agreement ”), among Deerfield & Company LLC, an Illinois
limited liability company (“ D&C ”),
Deerfield Capital Management LLC, a Delaware limited liability
company and a wholly owned subsidiary of D&C (“
Deerfield ”), and Gregory H. Sachs (“
Sachs ”), (ii) the Fourth Amended and Restated
Operating Agreement of D&C, dated as of June 26, 2004 (as
amended, supplemented or otherwise modified from time to time, the
“ Operating
Agreement ”) and (iii)
the Agreement and Plan of Merger, dated as of the date hereof (as
amended, supplemented or otherwise modified from time to time, the
“ Merger
Agreement ”), by and
among Deerfield Triarc Capital Corp., a Maryland corporation
(“ DFR
”), DFR Merger Company, LLC, an
Illinois limited liability company and a wholly owned subsidiary of
DFR (“ Merger
Sub ”), D&C and
Triarc Companies, Inc., a Delaware corporation (“
Triarc ”), for the purposes set forth therein (in such
capacity, the “ Sellers’ Representative ”). Pursuant to the Merger Agreement, Merger Sub
will merge with and into D&C and, as a result of such merger,
the members of D&C will be entitled to receive, shares of
preferred stock of DFR that will be exchanged into shares of common
stock of DFR upon receipt of necessary DFR stockholder approvals,
and promissory notes of DFR (such merger, the “
Merger ”).
This letter agreement (the “ Agreement ”) reflects certain arrangements between you and your
affiliates, Sachs Capital Management LLC (“
SCM ”) and Spensyd Asset Management LLLP (“
Spensyd ”), on the one hand, and D&C, Deerfield,
Triarc and DFR, on the other hand, regarding, among other things,
the termination of the Employment Agreement and the cessation of
your employment thereunder, the waiver of your Put Rights under the
Operating Agreement, the termination of certain of your obligations
under the Operating Agreement and the treatment of certain other
matters, in each case subject to and only upon the consummation of
the Merger pursuant to the Merger Agreement. Capitalized terms not
otherwise defined herein shall have the meanings given such terms
in the Employment Agreement (which meanings shall remain
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incorporated herein by
reference notwithstanding the termination of the Employment
Agreement pursuant to paragraph 2 below). In addition, all
references in this Agreement to “you” (including in its
possessive form) shall be deemed to be references to
Sachs.
1. Your services as a
director and as an officer and employee of the Deerfield Companies
and each of their subsidiaries shall cease subject to, and be
effective immediately upon, the consummation of the Merger. The
foregoing did not (and does not) apply to, or affect, your position
as a member of the Board of Directors of DFR. The date on which
your services so terminate is referred to herein as the
“ Termination
Date ”.
2. The Employment
Agreement shall terminate simultaneously with the termination of
your services on the Termination Date and have no further legal
effect and you shall have no further liability or obligations
thereunder, including without limitation any liability or
obligations under Sections 5 and 6 of the Employment
Agreement; provided ,
however , that each of Sachs, SCM and Spensyd shall enter into
on the Termination Date a non-solicit and non-hire agreement in a
form substantially the same as that set forth in
Annex I hereto. Prior to the Termination Date, the terms of
the Employment Agreement continue in full force and effect and
shall govern the rights and obligations of the parties
thereto.
3. The parties
acknowledge that your resignation from employment with the
Deerfield Companies shall be treated as a termination by the
Deerfield Companies without Cause (other than by reason of
Employee’s death or Disability) pursuant to Section 3(a)(ii)
of the Employment Agreement and shall become effective as of the
Termination Date. The date of the Notice of Termination shall be
deemed to be the Termination Date. Notwithstanding anything to the
contrary contained in the Employment Agreement, you will be
entitled to receive (a) a Severance Benefit in an amount equal to
the Base Salary you would have received had you remained employed
with the Deerfield Companies from the Termination Date until July
22, 2009 and (b) a bonus in an amount equal to (i) 8% of the sum of
(x) EBITDA from the first day of the D&C fiscal year in which
the Termination Date occurs through the last day of the month in
which the Termination Date occurs and (y) $12,500,000 (the
“ Pro Rata
Bonus ”);
provided that in the event the Termination Date occurs after
December 31, 2007, you shall also be entitled to receive your
Annual Bonus and Additional Bonus for the year ended December 31,
2007 as calculated and paid in accordance with the Employment
Agreement in addition to the Pro Rata Bonus. The Severance Benefit
and the Pro Rata Bonus, plus interest thereon, shall each be
payable to you on the first business day following the six-month
anniversary of the Termination Date (the parties acknowledging that
such six-month delay is being implemented to comply with Section
409A of the Internal Revenue Code of 1986, as amended). The
interest on the Severance Benefit shall accrue at a rate of
six-month LIBOR per annum, as appearing in the
Wall Street Journal
“Money Rates” on the
Termination Date, from and including the Termination Date to (but
excluding) the payment date, and the interest on the Pro Rata Bonus
shall accrue at a rate of six-month LIBOR per annum, as appearing
in the Wall Street
Journal “Money
Rates” on the 75th day following the end of the month in
which the Termination Date occurs (the “
75th Day ”), from and including the 75th Day to (but
excluding) the payment date. The Annual Bonus and Additional Bonus,
if any, shall be paid on or prior to
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February 28, 2008.
Effective as of the Termination Date, you shall have no further
rights to any compensation (including any Base Salary, Annual Bonus
or Additional Bonus) or other benefits, including those benefits
set forth in Section 2(c) through (h) under the Employment
Agreement (other than your right to receive the Severance Benefit
(including Pro Rata Bonus) described above, any earned but unpaid
Base Salary through the Termination Date, any Annual Bonus and
Additional Bonus earned in respect of the fiscal year ended
December 31, 2007 (but only if the Termination Date does not occur
on or prior to December 31, 2007, it being acknowledged and agreed
that you shall in no event be entitled to any payment of such
Annual Bonus or Additional Bonus under this Agreement to the extent
you have received any payment of such Annual Bonus or Additional
Bonus under the Employment Agreement), your right to receive
reimbursement for business expenses incurred through the
Termination Date pursuant to Section 2(c) of the Employment
Agreement, your right to elect to receive COBRA continuation
coverage, other vested benefits pursuant to the applicable plans
and as otherwise specifically provided in this Agreement) under the
Employment Agreement, and you shall not participate in any
severance plan, policy or program of the Deerfield Companies. The
right to and payment of the Severance Benefit, the Pro Rata Bonus
and, if applicable, Annual Bonus and Additional Bonus shall be
unconditional and absolute and shall be made without setoff,
recoupment, counterclaim or any other defense of
payment.
4. (a) On the
Termination Date, you shall have the option, but shall not be
required to, purchase at its fair market value of $1,000, the
computer equipment listed on Annex II .
(b) D&C agrees to provide (i) for a period of not less than
twelve (12) months following the Termination Date, your continued
use of your D&C email address and phone number and to ensure
that during the first six (6) months of such period (x) all emails
are forwarded to an email address that you will provide to D&C
prior to the Termination Date and (y) an automated response is
provided on each of your D&C email and your phone number
indicating your new email address and your new phone number (such
number to be provided by you to D&C prior to the Termination
Date), (ii) you with permanent use of, or transfer directly to you
on or before the Termination Date, the cell phone number that you
currently use in connection with your employment with the Deerfield
Companies and you shall be responsible for all charges and costs in
connection therewith relating to periods following the Termination
Date.
(c) From the Termination Date through and including February
29, 2008 (the “ Covered
Period ”), the
Deerfield Companies shall use reasonable efforts to provide you, at
the Deerfield Companies’ expense, with (i) access to your
current office in the Deerfield Companies’ premises (the
“ Office
”) and (ii) the services of your
current administrative assistant (the “ Assistant ”). During the Covered Period, the Deerfield
Companies shall pay the Assistant the same salary and bonus, and
provide the Assistant with the same benefits, such Person received
or was entitled to immediately prior to the Termination
Date; provided
, that on the final day of the Covered
Period, the Deerfield Companies shall pay to the Assistant, to the
extent not previously paid, in respect of the bonus for the year
ended December 31, 2007, an amount equal to the amount of
the
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bonus the Assistant was
paid for the year ended December 31, 2006, assuming such individual
was not (i) terminated for “Cause” (as customarily
determined by the Deerfield Companies for such purposes in the
ordinary course of business) and (ii) did not resign as an employee
of the Deerfield Companies prior to December 31, 2007.
5. The Deerfield
Companies and Triarc will use commercially reasonable efforts to
transfer to you effective on or promptly after the Termination
Date, the key man life insurance policies insuring you, that they
own, that are listed on Annex
III , to the extent
permitted by such policies and without any obligation to incur any
out-of-pocket costs to effect such transfer; provided that Sachs
may at his election pay any such out-of-pocket expenses in order to
permit such transfer.
6. (a) Each of SCM and
Spensyd hereby agree that, until the earlier of (i) the
consummation of the Merger, (ii) the termination of the Merger
Agreement in accordance with its terms or (iii) December 31, 2007,
it shall not Transfer (as defined in the Operating Agreement) any
Membership Interests (as defined in the Operating Agreement) it
owns except pursuant to the Merger or to a Permitted Transferee (as
defined in the Operating Agreement). The parties hereto acknowledge
and agree that each of SCM and Spensyd shall be entitled to all
rights as, and subject to all obligations of, the Members for
purposes of the Operating Agreement and the Merger Agreement, in
each case, to the extent of its Membership Interests (as defined in
the Operating Agreement); provided ,
however , that neither SCM nor Spensyd shall have any
obligations under the Merger Agreement with respect to any
indemnification provisions contained therein (other than in Section
9.3 thereof in accordance with the terms contained in Section 9.3
thereof). Notwithstanding the foregoing, nothing in this paragraph
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party beneficiary or other rights or other remedies under the
Merger Agreement, except as expressly set forth therein.
(b) At the closing contemplated by the
Merger Agreement, each of the parties hereto shall, and shall cause
its controlled affiliates to, enter into the applicable Note
Documents (as defined in the Merger Agreement) to which such party
is contemplated to be a party.
7. Each of SCM and
Spensyd hereby agree that until the earlier of (i) the consummation
of the Merger, (ii) the termination of the Merger Agreement in
accordance with its terms or (iii) December 31, 2007, it will
refrain from exercising any and all rights it may have under
Section 9.11 of the Operating Agreement. In addition, you hereby
agree that until the earlier of (i) the consummation of the Merger,
(ii) the termination of the Merger Agreement in accordance with its
terms or (iii) December 31, 2007, you will refrain from objecting
to any determination made by you and the other directors of D&C
under Section 9.13 of the Operating Agreement in respect of the
transactions contemplated by the Merger Agreement, except as may
otherwise be required by law, and you will also refrain from
requesting any fairness opinion under Section 7.7 of the Operating
Agreement in connection with the transactions contemplated by the
Merger Agreement and related agreements. The parties hereto
acknowledge and agree that from and after the Termination Date,
neither SCM, Spensyd, Sachs nor any of
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their affiliates shall
have any further duties or obligations under Sections 11.1 and 11.2
of the Operating Agreement.
8. (a) You, on your own
behalf and on behalf of your affiliates, descendants, dependents,
heirs, executors and administrators and permitted assigns, past and
present (collectively, the “ Sachs Releasees ”), in consideration for the amounts payable and
benefits to be provided to you under paragraphs 3, 4, 5 and 6
above, do hereby covenant not to sue or pursue any litigation (or
file any charge or, except as may be required by applicable law,
otherwise correspond with any Federal, state or local
administrative agency), arbitration or other proceeding against,
and waive, release, acquit and forever discharge, to the fullest
extent permitted by law, the Deerfield Companies, Triarc and their
respective assigns, affiliates, subsidiaries, parents, predecessors
and successors, and the past and present shareholders, employees,
officers, directors, partners, members, managers, representatives
and agents or any of them, and each of their affiliates, successors
and assigns, but not including DFR and its subsidiaries
(collectively, the “ Company Group ”), of, from and against any and all claims, demands,
damages, rights, judgments, debts, dues, defenses, actions, suits,
charges or causes of action whatsoever, of any and every kind,
nature and description (other than for fraud or willful
misconduct), whether known or unknown, accrued or not accrued, in
law or in equity, that you ever had, now have or shall or may have
or assert as of the date of this Agreement relating to or arising
out of events or circumstances occurring on or before the date
hereof against any member of the Company Group, including, without
limiting the generality of the foregoing, any claims, demands,
damages, rights, judgments, debts, dues, defenses, actions, suits,
charges or causes of action arising out of or related to your
employment or termination of employment, or any term or condition
of that employment, or that arise out of or relate in any way to
any Federal, state or local statutory and common laws, including
but not limited to the Age Discrimination in Employment Act of 1967
(“ ADEA
,” a law that prohibits
discrimination on the basis of age), the Older Workers Benefit
Protection Act, 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 and Medical Leave Act, the
Sarbanes-Oxley Act of 2002, all as amended, and any other Federal,
state and local laws relating to discrimination on the basis of
age, sex or other protected class, all claims under Federal, state
or local laws for express or implied breach of contract, wrongful
discharge, defamation, intentional infliction of emotional
distress, and any related claims for attorneys’ fees and
costs; provided
, that you do not waive, release,
acquit or discharge any rights to indemnification that you may have
under the articles of organization, the operating agreement,
charter, bylaws or equivalent governing documents of the Deerfield
Companies, Triarc or their respective subsidiaries or affiliates,
the laws of the State of Illinois or Delaware or any other state of
which such subsidiary or affiliate is a domiciliary, or any
indemnification agreement between you and the Deerfield Companies
or between you and Triarc, or any rights to insurance coverage
under any directors’ and officers’ personal liability
insurance or fiduciary insurance policy; provided further , that the
foregoing covenant, waiver, release, acquittal and discharge shall
not apply to any claims any Sachs Releasee may have to enforce this
Agreement, the Merger Agreement and related agreements or the
surviving provisions of the Operating Agreement to the extent they
relate to periods from and after the date
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hereof. You further
agree that this Agreement may be pleaded as a full defense to any
action, suit, arbitration or other proceeding covered by the terms
hereof which is or may be initiated, prosecuted or maintained by
you, your heirs or assigns. Notwithstanding the foregoing, you
understand and confirm that you are executing this Agreement
voluntarily and knowingly, and this Agreement shall not affect your
right to claim otherwise under the ADEA. In addition, you shall not
be precluded by this Agreement from filing a charge with any
relevant Federal, State or local administrative agency, but you
agree not to participate in any such administrative proceeding
(other than any proceeding brought by the Equal Employment
Opportunity Commission), and agree to waive your rights with
respect to any monetary or other financial relief arising from any
such administrative proceeding.
(b) The Deerfield Companies, each on their own behalf and on
behalf of eac
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