Exhibit 10.2
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
\ THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT ("Agreement") dated as
of the 13th day of November 2008 (the "Effective Date"), by and between First
Montauk Financial Corp., a New Jersey corporation with its principal address at
Parkway 109 Office Center, 328 Newman Springs Road, Red Bank New Jersey 07701
(the "Company") and Mindy A. Horowitz, with her residence at 208 Buttermere
Avenue, Interlaken, New Jersey 07712 ("Executive").
WHEREAS, the Company, through its wholly owned subsidiary, First
Montauk Securities Corp. ("FMSC"), is engaged in the investment banking and
general securities business as a registered broker-dealer;
WHEREAS, the Company has employed the Executive since February 1, 2005
pursuant to an Employment Agreement dated as of February 8, 2005 ("Original
Agreement");
WHEREAS, the Board of Directors of the Company (the "Board") wishes
Executive to continue to serve as Senior Vice President of the Company and Chief
Financial Officer of the Company's Broker Dealer Subsidiary, First Montauk
Securities Corp.; and
WHEREAS, Executive is willing to provide her services and experience to
the Company and its subsidiaries in such capacities upon the terms, conditions
and provisions hereinafter set forth in this Agreement.
NOW, THEREFORE, in consideration of the promises and mutual
representations, covenants and agreements set forth herein, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. TERM:
Subject to the terms and conditions of Section 7 hereof and for the
compensation hereinafter set forth, the Company hereby agrees to employ
Executive for term commencing effective as of the date hereof and ending April
30, 2009 (such period in its entirety being herein referred to as the "Term").
The portion of the Term from the date hereof through and including January 31,
2009 shall sometimes be referred to as the "Initial Period" and the portion of
the Term from February 1, 2009 through and including April 30, 2009 shall
sometimes be referred to as the "Secondary Period"
2. EMPLOYMENT:
(A) Executive shall serve as Senior Vice President and Chief Financial
Officer of the Company's Broker Dealer Subsidiary, First Montauk Securities
Corp. ("Broker Dealer Subsidiary"). Executive's powers and duties shall be those
of an executive nature (including those responsibilities specified in Section
2(B)) below, which are appropriate for a Senior Vice President and Chief
Financial Officer. Executive shall report to the Chief Executive Officer of the
Company or the Board of Directors.
(B) Executive does hereby accept such employment and agrees during the
Initial Period to devote substantially all of her business time, attention,
knowledge and skills faithfully, diligently and to the best of her ability, in
furtherance of the business and activities of the Company. During the Secondary
Period, Executive shall devote such amount of her business time, attention,
knowledge and skills faithfully, diligently and to the best of her ability, in
furtherance of the business and activities of the Company in order to (i) assist
the Company's management and its outside auditors and legal counsel in the
preparation of any and all filings with the Securities and Exchange Commission,
including, without limitation, the Company's Annual Report on Form 10-K, the
Company's federal, state and local income tax returns, and any and all reports
that the Company and/or the Broker Dealer Subsidiary may be required to file
with the Financial Industry Regulatory Authority ("FINRA")(formerly the National
Association of Securities Dealers, Inc.), the Municipal Securities Rule Making
Board, the National Futures Association and the Securities Investor Protection
Corporation, and any other applicable regulatory agencies or governmental bodies
having jurisdiction over the Company or the Broker Dealer Subsidiary; and (ii)
in the winding down of the business operations of the Company and/or the Broker
Dealer Subsidiary.
(C) The Company shall not require Executive to be employed in any
location other than the Red Bank, New Jersey area unless she consents in writing
to such location provided, however, the Executive understands and agrees that
her position with the Company may include travel to the Company's other offices
and branch locations.
(D) During the Term, Executive shall be furnished with office space and
facilities commensurate with her position and adequate for the performance of
her duties; Executive also shall be provided with the perquisites customarily
associated with the position as Senior Vice President and Chief Financial
Officer.
(E) Executive shall be allowed, to the extent such activities do not
substantially interfere with the performance of her duties and responsibilities
hereunder, (i) to manage her personal, financial and legal affairs, (ii) to be
engaged in civic, charitable, religious and educational activities, and (iii) to
serve on other corporate boards with the prior written approval of the Board.
3. COMPENSATION:
(A) SALARY:
1. During the Initial Period of this Agreement, the Company agrees to
pay Executive, and Executive agrees to accept, an annual salary of not less than
One Hundred Sixty Thousand Dollars ($160,000) per year (the "Initial Base
Salary"), payable in accordance with the Company's policies, for services
rendered by Executive hereunder.
2. During the Secondary Period of this Agreement, Executive will not
receive any annual salary. In lieu of any annual salary or severance pay payable
under the Original Agreement and in consideration of the duties and services to
be provided by Executive during the Secondary Period, Executive will receive on
November 15, 2008 a lump sum payment in the amount of One Hundred Forty Thousand
Dollars ($140,000) ("Lump Sum Amount").
3. In the event that Executive voluntarily terminates her employment
with the Company other than for Reason (as defined in Section 7(D) below) prior
to February 1, 2009 (the commencement date of the Secondary Period), Executive
shall reimburse the Lump Sum Amount in its entirety to the Company.
4. In the event that Executive voluntarily terminates her employment
with the Company other than for Reason on February 1, 2009, Executive shall
reimburse $40,000 to the Company.
5. In the event that Executive voluntarily terminates her employment
with the Company other than for Reason during the Secondary Period after
February 1, 2009 and prior to April 30, 2009, Executive shall reimburse to the
Company an amount equal to the product of (a) $40,000 and (b) a fraction, the
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numerator of which is the number of calendar days remaining in the Secondary
Period following Executive's date of termination and the denominator of which is
89 representing the total number of calendar days in the Secondary Period;
provided that in the event that Executive terminates her employment after
March 31, 2009, Executive will not be required to make any reimbursement to the
Company if Executive, in the reasonable judgment of the Board of Directors,
makes herself available on a reasonable basis to assist the Company's Board of
Directors, management and auditors in the preparation of the Company's income
tax returns and the winding down of the business of the Company and/or the
Broker Dealer Subsidiary.
(B) AUTOMOBILE ALLOWANCE AND CELL PHONE:
The Company shall provide the Executive with an automobile allowance of
$500 per month, cellular telephone, and reimburse reasonable automobile expenses
including auto insurance, repairs, maintenance, gasoline charges, etc. via
receipted expense reports.
(C) CORPORATE CREDIT CARD:
Executive shall have continued use of a corporate credit card to be
used for all reasonable business expenses incurred by Executive on behalf of the
Company upon presentation of suitable documentation.
4. EXPENSES:
The Company shall reimburse Executive for all reasonable and actual
business expenses incurred by her in connection with her service to the Company,
Broker Dealer Subsidiary and/or any direct and/or indirect subsidiaries of such
entities upon submission by her of appropriate vouchers and expense account
reports and otherwise in compliance with the policies and procedures of the
Company.
5. BENEFITS:
(A) INSURANCE:
1. The Company shall maintain family medical insurance for Executive.
In addition, Executive and her dependents shall be entitled to
participate in such other benefits as may be extended to active
executive employees of the Company and/or Broker Dealer Subsidiary
and their dependents including but not limited to pension,
retirement, profit-sharing, 401(k), stock option, bonus and
incentive plans, life insurance, hospitalization, medical,
disability or other benefits made available by the Company to its
employees generally.
2. The Company shall maintain Broker/Dealer Professional Liability
Insurance (E&O), Directors and Officers Liability Insurance (D&O)
and a Broker Dealer Fidelity Blanket Bond, each of which shall
cover Executive as an insured or covered person, at no charge to
Executive, provided the Company is able to obtain such coverage.
(B) LICENSES AND REGISTRATIONS:
During the Term, Executive shall maintain in good standing all required
licenses and registrations required for the proper performance of her duties and
functions. During the Term, the Company shall pay the cost of maintaining such
licenses and registrations on Executive's behalf, including but not limited to
Executive's accounting licenses and continuing educations costs, and securities
licenses and registrations.
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(C) INDEMNIFICATION:
Executive shall be entitled to the benefits of all provisions of the
Certificate of Incorporation of the Company, as amended, and the Bylaws of the
Company, as amended, that provide for indemnification of officers and directors
of the Company. In addition, without limiting the indemnification provisions of
the Certificate of Incorporation or Bylaws, to the fullest extent permitted by
law, the Company shall indemnify and save and hold harmless Executive from and
against any and all claims, demands, liabilities, costs and expenses, including
judgments, fines or amounts paid on account thereof (whether in settlement or
otherwise), and reasonable expenses, including attorneys' fees actually and
reasonably incurred (except only if and to the extent that such amounts shall be
finally adjudged to have been caused by Executive's willful misconduct or gross
negligence, including the willful breach of the provisions of this Agreement) to
the extent that Executive is made a party to or witness in any action, suit or
proceeding, or if a claim or liability is asserted against Executive (whether or
not in the right of the Company), by reason of the fact that she was or is a
director or officer, or acted in such capacity on behalf of the Company, or the
rendering of services by Executive pursuant to her Agreement, whether or not the
same shall proceed to judgment or be settled or otherwise brought to a
conclusion. The Company shall, at no cost to Executive, include Executive during
the Term and for a period of not less than two (2) years thereafter, as an
insured under the directors and officers liability insurance policy maintained
by the Company, unless (despite best efforts of the Company) due to some
unforeseeable reason it is not possible for Executive to be so included, in
which event the Company shall immediately notify Executive.
6. RESTRICTIVE COVENANTS:
(A) Executive recognizes and acknowledges that the Company, Broker
Dealer Subsidiary and their subsidiaries, through the expenditure of
considerable time and money, have developed and will continue to
develop in the future information concerning customers, clients,
marketing, business and operational methods of the Company, Broker
Dealer Subsidiary and their subsidiaries and their customers or
clients, contracts, financial or other data, technical data or any
other confidential or proprietary information possessed, owned or used
by the Company, Broker Dealer Subsidiary and their subsidiaries, and
that the same are confidential and proprietary, and are "confidential
information" of the Company, Broker Dealer Subsidiary and their
subsidiaries. In consideration of her continued employment by the
Company hereunder, Executive agrees that she will not, during or for a
period of one year after termination of employment, directly or
indirectly, make any disclosure of confidential information now or
hereafter possessed by the Company, Broker Dealer Subsidiary, and/or
any of their current or future, direct or indirect subsidiaries
(collectively, the "Group"), to any person, partnership, corporation or
entity either during or after the term hereunder, except to employees
of the Group and to others within or without the Group, as Executive
may deem necessary in order to conduct the Group's business and except
as may be required pursuant to any court order, judgment or decision
from any court of competent jurisdiction. The foregoing shall not apply
to information which is in the public domain on the date hereof; which,
after it is disclosed to Executive by the Group, is published or
becomes part of the public domain through no fault of Executive; which
is known to Executive prior to disclosure thereof to her by the Group
as evidenced by her written records; or, after Executive is no longer
employed by the Group, which is thereafter disclosed to Executive in
good faith by a third party which is not under any obligation of
confidence or secrecy to the Group with respect to such information at
the time of disclosure to her. The provisions of this Section 6 shall
continue in full force and effect notwithstanding termination of
Executive's employment under this Agreement or otherwise.
(B) Executive agrees that if the Company has made and is continuing to
make all required payments to her upon and after termination of her
employment, then for a period commencing on the date of termination of
Executive's employment pursuant to this Agreement and ending twelve
(12) months thereafter, Executive shall neither directly and/or
indirectly solicit or hire any then current employee of the Company
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and/or Broker Dealer Subsidiary nor any of their respective direct
and/or indirect subsidiaries (collectively, the "Applicable Entities"),
nor (b) solicit any business with any prior (within twelve (12) months
of termination) or then current customer and/or client of the
Applicable Entities, unless Executive had a pre-existing relationship
with the customer.
(C) Executive acknowledges that the restrictive covenants (the
"Restrictive Covenants") contained in her Section 6 are a condition of
her continued employment and are reasonable and valid in geographical
and temporal scope and in all other respects. If any court determines
that any of the Restrictive Covenants, or any part of any of the
Restrictive Covenants, is invalid or unenforceable, the remainder of
the Restrictive Covenants and parts thereof shall not thereby be
affected and shall be given full effect, without regard to the invalid
portion. If any court determines that any of the Restrictive Covenants,
or any part thereof, is invalid or unenforceable because of the
geographic or temporal scope of such provision, such court shall have
the power to reduce the geographic or temporal scope of such provision,
as the case may be, and, in its reduced form, such provision shall then
be enforceable.
(D) If Executive breaches, or threatens to breach, any of the
Restrictive Covenants, the Company, in addition to and not in lieu of
any other rights and remedies it may have at law or in equity, shall
have the right to injunctive relief; it being acknowledged and agreed
to by Executive that any such breach or threatened breach would cause
irreparable and continuing injury to the Company and that money damages
would not provide an adequate remedy to the Company.
7. TERMINATION:
(A) DEATH:
In the event of Executive's death ("Death") during the Term of her
employment, Executive's designated beneficiary, or in the absence of such
beneficiary designation, her estate, shall be entitled to the Accrued
Obligations, and to the payment of Executive's salary with respect to the
Initial Period, through the date of Death. For purposes of this Agreement,
"Accrued Obligations" shall mean (i) all accrued but unpaid salary through the
date of termination of Executive's employment, (ii) any unpaid or unreimbursed
expenses incurred in accordance with this Agreement, and (iii) all compensation
or benefits due to Executive under the terms and rules of any Company or Broker
Dealer Subsidiary compensation or benefit plan in which Executive participates,
including without limitation, any Company option plans, or otherwise required by
applicable law.
(B) DISABILITY:
(i) In the event Executive, by reason of physical or mental incapacity,
shall be disabled for a period of at least a period of 90 consecutive days
("Disability"), the Company shall have the option at any time thereafter to
terminate Executive's employment hereunder for Disability. Such termination will
be effective ten (10) days after the Board gives written notice of such
termination to Executive, unless Executive shall have returned to the
performance of her duties prior to the effective date of the notice. Upon such
termination, Executive shall be entitled to the Accrued Obligations and such
benefits to which he and her dependents are entitled by law, and except as
otherwise expressly provided herein, all obligations of the Company hereunder
shall cease upon the effectiveness of such termination other than payment of
salary earned through the date of Disability, provided that such termination
shall not affect or impair any rights Executive may have under any policy of
long term disability insurance or benefits then maintained on her behalf by the
Company.
(ii) "Incapacity" as used herein shall mean the inability of Executive
due to physical or mental illness, injury or disease substantially to perform
her normal duties as Senior Vice President and Chief Financial Officer.
Executive's salary as provided for hereunder shall continue to be paid during
any period of incapacity prior to and including the date on which Executive's
employment is terminated for Disability.
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(C) BY THE COMPANY FOR CAUSE:
(i) The Company shall have the right, before the expiration of the term
of this Agreement, to terminate Executive's employment hereunder and to
discharge Executive for cause (hereinafter "Cause"), and all compensation to
Executive shall cease to accrue upon discharge of Executive for Cause. For the
purposes of this Agreement, the term "Cause" shall mean (a) Executive's
conviction of a felony; (b) the alcoholism or drug addiction of Executive which
impairs her ability to perform her duties in the determination of the Chief
Executive Officer; (c) the continued and willful failure by Executive to
substantially and materially perform her material duties hereunder or the
refusal or failure by Employee to adhere to the Company's employment policies,
including, without limitation, policies regarding sexual harassment,
discrimination or the federal and state securities laws, after a reasonable
notice and an opportunity to cure same if such refusal or failure may be cured;
(d) an act or acts of personal dishonesty by Executive intended to result in
personal enrichment of Executive at the expense of the Company, the Company or
any of their subsidiaries or affiliates or any other material breach or
violation of Executive's fiduciary duty owed to the Company, Broker Dealer
Subsidiary or any of their subsidiaries or affiliates; (e) any grossly negligent
act or omission or any willful and deliberate misconduct by Executive that
results, or is likely to result, in material economic, or other harm, to the
Company, Broker Dealer Subsidiary or any of their subsidiaries or affiliates;
(f) an action taken by a governmental, regulatory body or self regulatory
organization that substantially impairs the Executive from performing her
duties; or (g) refusal by Executive to assist the Company, at the request of the
Board of Directors, in any investigation or other proceeding (whether formal or
informal) which is commenced by the Board of Directors, or any governmental,
regulatory body or self regulatory organization.
(ii) If the Company elects to terminate Executive's employment for
Cause under 7(C)(i) above, such termination shall be effective five (5) days
after the Company gives written notice of such termination to Executive. In the
event of a termination of Executive's employment for Cause in accordance with
the provisions of 7(C)(i), the Company shall have no further obligation to
Executive, except for the payment of the Accrued Obligations and such benefits
to which he and her dependents are entitled by law.
(D) RESIGNATION FOR REASON. Executive shall have the right to terminate
her employment at any time for "good reason" (herein designated and referred to
as "Reason"). The term Reason shall mean (i) the Company's failure or refusal to
perform any obligations required to be performed in accordance with this
Agreement after a reasonable notice and an opportunity to cure same, (ii) a
material diminution in Executive's title, duties, responsibilities, reporting
relationship or positions, (iii) the relocation of Executive's principal office
location more than fifty (50) miles from its current location, and (iv) the
failure of the Company or Broker Dealer Subsidiary to obtain the assumption in
writing of its obligation to perform this Agreement by any successor to all or
substantially all of the assets of the Company. Notwithstanding the occurrence
of any such event or circumstance above, such occurrence shall not be deemed to
constitute Reason hereunder if, within the thirty-day notice period, the event
or circumstance giving rise to Reason has been fully corrected by the Company.
(E) NON-RENEWAL: This Agreement shall not be renewed ("Non-Renewal),
after the expiration of the Secondary Period except as otherwise agreed in
writing by the Company and Executive.
(F) SEVERANCE: Except as provided in Section 3(A), Executive shall not
be entitled to any pay upon termination of her employment with the Company.
Notwithstanding the foregoing sentence, in the event Executive's employment
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hereunder shall be terminated by the Company for other than Cause, Death or
Disability, or Non-Renewal, or if terminated by Executive for Reason: (i)
Executive's (and her dependents') participation in any and all life, disability,
medical and dental insurance plans shall be continued, or equivalent benefits
provided to her or them by the Company, at no cost to her or them, for a period
of 12 months from the termination and (ii) Executive shall be entitled to the
Accrued Obligations and such benefits to which he and her dependents are
entitled by law.
(G) RESIGNATION WITHOUT REASON: Executive may voluntarily resign her
employment with the Company upon ten (10) days' written notice to the Company
without any liability to Executive except that if Executive voluntarily resigns
prior to February 1, 2009, the commencement date of the Secondary Period,
Executive shall reimburse the Lump Sum Amount in its entirety to the Company on
her date of termination of employment as provided in Section 3(A)(iii). In the
event Executive resigns without reason prior to the expiration of this
Agreement, she shall receive only the Accrued Obligations and such benefits to
which she and her dependents are entitled by law.
8. WAIVER:
No delay or omission to exercise any right, power or remedy accruing to
either party hereto shall impair any such right, power or remedy or shall be
construed to be a waiver of or an acquiescence to any breach hereof. No waiver
of any breach hereof shall be deemed to be a waiver of any other breach hereof
theretofore or thereafter occurring. Any waiver of any provision hereof shall be
effective only to the extent specifically set forth in the applicable writing.
All remedies afforded to either party under this Agreement, by law or otherwise,
shall be cumulative and not alternative and shall not preclude assertion by
either party of any other rights or the seeking of any other rights or remedies
against the other party.
9. GOVERNING LAW:
The validity of this Agreement or of any of the provisions hereof shall
be determined under and according to the laws of the State of New Jersey, and
this Agreement and its provisions shall be construed according to the laws of
the State of New Jersey, without regard to the principles of conflicts of law
and the actual domiciles of the parties hereto.
10. NOTICES:
All notices, demands or other communications required or permitted to
be given in connection with this Agreement shall be given in writing, shall be
transmitted to the appropriate party by hand delivery, by certified mail, return
receipt requested, postage prepaid or by overnight carrier and shall be
addressed to a party at such party's address shown on the signature page hereof.
A party may designate by written notice given to the other parties a new address
to which any notice, demand or other communication hereunder shall thereafter be
given. Each notice, demand or other communication transmitted in the manner
described in this Section 10 shall be deemed to have been given and received for
all purposes at the time it shall have been (i) delivered to the addressee as
indicated by the return receipt (if transmitted by mail) or the affidavit of the
messenger (if transmitted by hand delivery or overnight carrier) or (ii)
presented for delivery during normal business hours, if such delivery shall not
have been accepted for any reason.
11. ASSIGNMENT:
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and each of their respective successors, assigns, heirs and legal
representatives; provided, however, that Executive may not assign or delegate
her obligations, responsibilities and duties hereunder except as may otherwise
be expressly agreed to in writing by the parties hereto. The Company and Broker
Dealer Subsidiary will require any such purchaser, successor or assignee to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company and Broker Dealer Subsidiary would be required
to perform it if no such purchase, succession or assignment had taken place. If
Executive shall die, all amounts then payable to Executive hereunder shall be
paid in accordance with the terms of this Agreement to Executive's devisee,
legatee or other designee or, if there be no such designee, the Executive's
estate.
12. MISCELLANEOUS:
This Agreement contains the entire understanding between the parties
hereto and supersedes all other oral and written agreements or understandings
between them with respect to the subject matter hereof. No modification or
addition hereto or waiver or cancellation of any provision shall be valid except
by a writing signed by the party to be charged therewith.
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13. SEVERABILITY:
The parties agree that if any of the covenants, agreements or
restrictions contained herein are held to be invalid by any court of competent
jurisdiction, the remainder of the other covenants, agreements, restrictions and
parts thereof herein contained shall be severable so not to invalidate any
others and such other covenants, agreements, restrictions and parts thereof
shall be given full effect without regard to the invalid portion.
14. ARBITRATION:
Any and all disputes, controversies, or differences, whether arising or
commenced during or subsequent to the term hereof, which may arise between the
parties directly and/or indirectly out of or in relation to or in connection
with this Agreement, or for the breach of this Agreement, shall be settled by
arbitration in New York City, New York before three arbitrators under the
arbitration rules of the Financial Industry Regulatory Authority ("FINRA") then
in effect. Each of the arbitrators shall be appointed in accordance with the
rules of FINRA. Such arbitration shall be final and binding and shall be limited
to an interpretation and application of the provisions of this Agreement and any
related agreements or documents. Any arbitral award shall be enforceable in any
court, wherever located, having jurisdiction over the party against whom the
award was rendered and may include an award of attorneys' fees and expenses,
proceeding costs, and all other costs and expenses reasonably associated with
such arbitration or enforcement proceedings (i.e., travel, lodging,
telecommunications charges).
15. SURVIVAL OF OPERATIVE SECTIONS:
The respective rights and obligations of the parties hereto, including,
without limitation, the rights and obligations set forth in Sections 3(A), 5(C),
6 through 14 of this Agreement, shall survive any termination of this Agreement
to the extent necessary to preserve all such rights and obligations until
discharged in full.
16. COUNTERPARTS:
This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original but all of which together shall
constitute one and the same instrument. The execution of this Agreement may be
by actual or facsimile signature.
17. SEPARATE COUNSEL. Executive hereby expressly acknowledge that she
has been advised that she has not been represented by Becker & Poliakoff, LLP,
the Company's attorney in connection with this Agreement and has been advised
and urged to seek separate legal counsel for advice in this matter.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day
and year first above written.
FIRST MONTAUK FINANCIAL CORP. MINDY A. HOROWITZ
/s/ Victor K. Kurylak /s/ Mindy A. Horowitz
- --------------------------------- ---------------------------
Victor K. Kurylak, Mindy A. Horowitz
Title: President and C.E.O. Executive
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