Exhibit 10.53

 

DEFERRED COMPENSATION AGREEMENT
BETWEEN
ALLIANCE ENERGY LLC AND EDWARD J. FANEUIL

 

This Agreement (the “Agreement”) is entered into between Alliance Energy LLC
(the “Company”) and Edward J. Faneuil (the “Executive”).

 

WHEREAS, the Executive is the Secretary and chief legal advisor of, and provides
significant senior management services to, the Company; and

 

WHEREAS, in consideration of (i) the Executive being available to provide
management services to the Company from time to time through the earlier of
(a) August 1, 2014; and (b) the day prior to the Executive becoming entitled to
receive payment of the Deferred Compensation pursuant to Section 1 below, and
(ii) the restrictive covenants set forth in attached Exhibit A, the Company
agrees to provide deferred compensation to the Executive, payable in the amounts
and on the terms and conditions set forth herein.

 

NOW THEREFORE, in consideration of the mutual promises made herein, the
Executive and the Company hereby agree as follows:

 

1.                                       Deferred Compensation.  The Company
agrees to pay to the Executive deferred compensation on the following terms and
conditions.

 

(a)                                  Except as otherwise provided in Sections
1(b) and 1(c) below, the Company shall pay to the Executive an amount equal to
$70,000 per year (the “Deferred Compensation”) in equal monthly installments of
$5,833.33, subject to applicable withholding, on the first business day of each
month for 15 years (180 months) commencing on August 1, 2014.

 

(b)                                 In the event that the Executive dies prior
to having received any or all of the aggregate amount of the Deferred
Compensation payable under Section 1(a) (including if the Executive’s death
occurs before August 1, 2014), the Company shall pay to his Beneficiary (as
defined in Section 2 below) within sixty (60) days of the Executive’s date of
death a single lump-sum payment in an amount equal to the present value of the
remaining payments that would have been paid to the Executive had he not died. 
Such single lump-sum payment shall be calculated by applying a discount rate
equal to the then applicable 10-year Treasury Note interest rate.

 

(c)                                  If there is a Change in Control (as defined
in Section 2 below), or if the Executive is determined to have become Disabled
(as defined in Section 2 below), prior to the Executive having received any or
all of the aggregate amount of the Deferred Compensation payable under
Section 1(a) (including if the Change in Control or determination that the

 

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Executive has become Disabled occurs before August 1, 2014), the Company shall
pay to the Executive within sixty (60) days of the effective date of the Change
in Control or the determination that the Executive has become Disabled, a single
lump-sum payment in an amount equal to the present value of the remaining
payments that would have been paid to the Executive had the Change in Control
not occurred or had the Executive not become Disabled.  Such single lump-sum
payment shall be calculated by applying a discount rate equal to the then
applicable 10-year Treasury Note interest rate.

 

2.                                       Definitions. For purposes of this
Agreement, the following definitions apply:

 

(a)                                  “Affiliates” means all Persons directly or
indirectly controlling, controlled by or under common control with the Company,
where control shall be determined by a majority of voting power only.

 

(b)                                 “Beneficiary” means the Person or Persons
designated by the Executive in writing to receive the payment of Deferred
Compensation in the event of the Executive’s death. The form of Beneficiary
designation is attached to this Agreement as Exhibit B. Any Beneficiary
designation shall be effective only upon actual receipt by the Company of such
form. If no specific Beneficiary has been designated or all designated
Beneficiaries predecease the Executive, the Beneficiary shall be the Executive’s
estate.

 

(c)                                  A “Change in Control” shall occur on the
date that any one Person or group (other than Alfred Slifka or Richard Slifka,
or their respective family members or entities they control, individually or in
the aggregate, directly or indirectly (collectively referred to hereinafter as
the “Slifkas”)) acquires ownership of the equity interests of the Company that,
together with the equity interests of the Company already held by such Person or
group, constitutes more than 50% of the total voting power of the equity
interests of the Company; provided, however, if any one Person or group is
considered to own more than 50% of the total voting power of the equity
interests of the Company, the acquisition of additional equity interests by the
same Person or group shall not be deemed to be a Change in Control.  The
definition of “Change in Control” shall be interpreted, to the extent
applicable, to comply with Section 409A of the Code, and the provisions of
Treasury Regulation Section 1.409A and any successor statute, regulation and
guidance thereto; provided, however, an interpretation in compliance with
Section 409A of the Code shall not expand the definition of Change in Control in
any way or cause an acquisition by the Slifkas to result in a Change in Control.

 

(e)                                  “Code” means the Internal Revenue Code of
1986, as amended, and its related interpretive guidance, regulations and
rulings.

 

(f)                                    “Disability” or “Disabled” means that the
Executive is unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous period of not
less than twelve (12) months, or the Executive is, by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months, receiving income replacement benefits for a period of not less than
three months under an accident and health plan covering employees of the
Company.

 

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(g)                                 “Person” means an individual, a corporation,
a limited liability company, an association, a partnership, an estate, a trust
or any other entity or organization, other than the Company.

 

3.                                       Confidential Information and Restricted
Activities. The Executive will be subject to the terms and conditions relating
to confidential information, non-solicitation and non-competition set forth in
Exhibit A, which is incorporated into this Agreement by reference.

 

4.                                       Amendment and Termination.  This
Agreement may be amended or terminated only with the mutual written consent of
the Company and the Executive.  In the event of any amendments involving further
deferrals of the Deferred Compensation, each installment payment called for
under Section 1 above shall be treated, to the extent permissible under the
Code, as a separate payment for purposes of Section 409A of the Code.

 

5.                                       Section 409A; No Guarantee of any Tax
Consequences.  The parties hereto intend that this Agreement comply with the
requirements of Section 409A of the Code and related regulations and Treasury
pronouncements (“Section 409A”) and this Agreement shall be interpreted to
comply with Section 409A.  If any provision provided herein results in the
imposition of an additional tax under the provisions of Section 409A, the
Executive and the Company agree that any such provision will be reformed, to the
extent possible, to avoid imposition of any such additional tax in the manner
that the Executive and the Company mutually agree is appropriate to comply with
Section 409A. Notwithstanding the foregoing, the Company makes no guarantee of
any tax consequences under any section of the Code or state tax laws, including,
without limitation, Section 409A.

 

6.                                       Unsecured Promise to Pay.  This Plan
constitutes an unfunded and non-qualified deferred compensation arrangement
between the Company and the Executive. Neither the Executive nor any other
person shall have any interest in any specific asset or assets of the Company by
reason of any obligations hereunder nor any rights to payment of any Deferred
Compensation except as expressly provided hereunder. The rights of the Executive
and any designated beneficiary are unsecured and shall be subject to the
creditors of the Company.

 

7.                                       Incapacity.  If the Company shall
receive evidence satisfactory to it that Executive or any Beneficiary entitled
to receive any benefit under this Agreement, at the time when such benefit
becomes payable, is a minor or is physically or mentally incompetent to give a
valid release therefor, and that another person or an institution is then
maintaining or has custody of such person and that no guardian, committee or
other representative of the estate of the Executive or Beneficiary shall have
been duly appointed, the Company may make payment(s) of benefits otherwise
payable to the Executive or Beneficiary to such other person or institution,
including a custodian under a Uniform Gifts to Minors Act, or corresponding
legislation, and the release of such other person or institution shall be a
valid and complete discharge for the payment of such benefit. Notwithstanding
the foregoing, if there is a reasonable question as to who is the rightful
recipient of any Deferred Compensation payments under this Agreement, the
Company may file an action in a court of competent jurisdiction to resolve such
question.

 

8.                                       Spendthrift Provision.  The Deferred
Compensation shall not be subject to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, or charges and any

 

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attempt so to anticipate, alienate, sell, transfer, assign, pledge, encumber or
charge the same shall be void; nor shall any portion of any such right hereunder
be in any manner payable to any assignee, receiver or trustee.

 

9.                                       Plan Administration.  This Agreement is
intended to be a plan (the “Plan”) of deferred compensation for a select group
of management or highly compensated employees described in Sections 201(2),
301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”), and shall be interpreted and administered accordingly. 
The Plan shall be administered by the Board of Directors of AE Holdings Corp.,
the sole member of the Company, or any successor group of such Board of
Directors (the “Board”). The Board shall have discretionary power and authority
to administer and interpret the Plan and make claims determinations consistent
with the terms of the Plan.  Determinations by the Board shall be final and
binding on all parties with respect to all matters relating to the Plan.  The
Board may delegate any of its responsibilities under the Plan provided that such
delegation does not result in any violation of the Plan or any applicable law,
rule, regulation or order.

 

10.                                 Claims.  Any person (“Claimant”) claiming a
benefit or requesting an interpretation, ruling or information under the Plan
shall present the request in writing to the Plan’s Committee, consisting of one
or more individuals designated by the Board from time to time (the
“Committee”).  The Committee may, in its discretion and at any stage of the
claims process, hold one or more hearings.  The Claimant may, at the Claimant’s
own expense, have an attorney or other representative act on the Claimant’s
behalf; provided that a written authorization is presented to the Committee. 
The procedure applied to a claim will depend upon whether the Committee must
determine whether a Participant has a Disability to determine his/her
entitlement to benefits.

 

(a)                                  Procedures for Claims Not Requiring a
Disability Determination.  For claims that do not involve a Disability
determination, the following claims procedures shall apply.

 

(i)                                     Timing of Initial Decision.  Within 90
days after the Claimant delivers the claim, the Claimant will receive either:
(A) a decision; or (B) a notice for extension describing special circumstances
requiring additional time to process the claim (up to 180 days from the day the
Claimant delivered the claim).  Any notice for extension will describe the
special circumstances (such as the need to hold a hearing) requiring more time
and the date by which the Committee expects to render a decision.

 

(ii)                                  Content of Initial Decision.  If the
Claimant’s claim is denied in whole or in part, the Claimant will receive a
written notice specifying: (A) the reasons for the denial; (B) the Plan
provisions on which the denial is based; (C) any additional information needed
from the Claimant in connection with the claim and the reason such information
is needed; and (D) an explanation of the claims review procedure and the
applicable time limits, including a statement of the Claimant’s right to bring a
civil action under Section 502(a) of ERISA following an adverse benefit
determination on appeal.  The time limits for making a decision on the
Claimant’s claim will be frozen until any necessary additional information is
received by the Committee.

 

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(iii)                               Appeal.  To appeal a benefit claim decision,
the Claimant must deliver the Claimant’s written request for review to the
Committee within 60 days of the date the Claimant received the initial claim
denial. The Claimant’s written request for review may (but is not required to)
include issues, comments, documents, and other records the Claimant wants
considered in the review.  All the information the Claimant submits will be
taken into account on appeal, even if it was not reviewed as part of the initial
decision.  The Claimant may ask to examine or receive free copies of all
pertinent Plan documents, records, and other information relevant to the
Claimant’s claim by asking the Committee.

 

(iv)                              Timing of Decision Upon Appeal.  Within 60
days after the Claimant delivers the request for review, the Claimant will
receive either: (A) a decision; or (B) a notice for extension describing special
circumstances requiring additional time to process the Claimant’s claim (up to
120 days from the day the Claimant delivered the request for review).  Any
notice for extension will describe the special circumstances (such as the need
to hold a hearing) requiring more time and the date by which the Committee
expects to render a decision on appeal.

 

(v)                                 Content of Decision Upon Appeal.  The
decision on the Claimant’s appeal will be in writing and will specify:  (A) the
reasons for the decision; (B) the Plan provisions on which the decision is
based; (C) any documents, records or other information relevant to the
Claimant’s claim and a statement that such documents, records and/or other
relevant information is available free of charge upon request; and (D) a
statement of the Claimant’s right to bring a civil action under
Section 502(a) of ERISA.

 

(b)                                 Procedures for Claims Requiring a Disability
Determination.  For claims that involve a Disability determination, the
following claims procedures shall apply.

 

(i)                                     Timing of Initial Decision.  Within 45
days after the Claimant delivers the claim, the Claimant will receive either:
(A) a decision; or (B) a notice for extension describing special circumstances
requiring additional time to process the claim (up to 75 days from the day the
Claimant delivered the claim).  Any notice for extension will explain the
standards on which the Claimant’s entitlement to a benefit is based, describe
the unresolved issues that prevent an immediate decision on the claim, and
indicate any additional information needed.  The Claimant will be given at least
45 days to provide any necessary additional information specified in the notice
for extension, and the time limits for making a decision on the claim will be
frozen until any necessary additional information is received by the Committee. 
The Plan may extend its decision for a second 30-day period if additional
reasons beyond the control of the Plan exist.  The Committee will provide the
Claimant with written notice if such circumstances arise.

 

(ii)                                  Content of Initial Decision.  If the
Claimant’s claim is denied in whole or in part, the Claimant will receive a
written notice as set forth in Section 10(a)(ii) herein, which notice shall also
specify any internal guidelines or criteria that were relied upon in making the
adverse determination.  The Claimant may request to examine or receive free
copies of such internal guidelines or criteria.

 

(iii)                               Appeal.  To appeal a Disability benefit
claim decision, the

 

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Claimant must deliver the Claimant’s written request for review to the Committee
within 180 days of the date the Claimant received the initial claim denial.  The
Claimant’s written request for review may (but is not required to) include
issues, comments, documents, and other records the Claimant wants considered in
the review.  All the information the Claimant submits will be taken into account
on appeal, even if it was not reviewed as part of the initial decision.  The
Claimant may ask to examine or receive free copies of all pertinent Plan
documents, records, and other information relevant to the Claimant’s claim by
asking the Committee.  The Claimant will receive information concerning the
identity of medical or vocational experts whose advice was obtained by the Plan
in connection with the Claimant’s initial claim denial, even if the advice of
such expert(s) was not relied upon by the Committee in making the initial
decision.  The review shall not afford any deference to the initial decision and
the review will be conducted by the Board.  With respect to any decision made
that is based in whole or in part on a medical judgment, the Board shall consult
with a health care professional who has appropriate training and experience in
the field of medicine with respect to such decision, and such health care
professional shall not be the same person who was consulted with respect to the
initial decision on the claim, nor a subordinate of such person.

 

(iv)                              Timing of Decision Upon Appeal.  Within 45
days after the Claimant delivers the request for review, the Claimant will
receive either: (A) a decision; or (B) a notice for extension describing special
circumstances requiring additional time to process the Claimant’s claim (up to
90 days from the day the Claimant delivered the request for review).  Any notice
for extension will describe the special circumstances (such as the need to hold
a hearing) requiring more time and the date by which the Committee expects to
render a decision on appeal.

 

(v)                                 Content of Decision Upon Appeal.  The
Claimant will receive a written notice as set forth in Section 10(a)(v) herein,
which notice shall also specify any internal guidelines or criteria that were
relied upon in making the adverse determination.  The Claimant may request to
examine or receive free copies of such internal guidelines or criteria.  The
written notice will also include a statement: “You or your plan may have other
voluntary alternative dispute resolution options, such as mediation.  One way to
find out what may be available is to contact your local U.S. Department of Labor
office and your State insurance regulatory agency.”

 

(c)                                  Final Decision.  The Executive shall only
be entitled to benefits under this Plan if the Committee (or the Board, if
applicable), in its discretion, determines the Executive is entitled to them. 
All decisions on appeal are final and binding on all parties, and decisions
shall be reviewed, if at all, only for an abuse of discretion.

 

11.                                 Notices.  For purposes of this Plan, notices
and all other communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when delivered personally or mailed
by United States registered or certified mail, return receipt requested, postage
prepaid, or by nationally recognized overnight delivery service, addressed to
the Executive at the home address set forth in the Company’s records, and to the
Company at its principal place of business (attention: President) or to such
other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.

 

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12.                                 Successors and Assigns.  This Agreement
shall be applicable to, and shall inure to the benefit of, the Company and its
successors and assigns and to the Executive and his heirs, executors,
administrators and personal representatives.

 

13.                                 Governing Law.  This Agreement shall be
governed by and construed in accordance with the laws of the Commonwealth of
Massachusetts without regard to its conflict of laws principles, to the extent
not preempted by U.S. federal law.

 

14.                                 Consent to Jurisdiction.  In the event of
any alleged breach of this Agreement which the parties are unable to settle by
mutual consultation, the Company and the Executive hereby consent and submit to
arbitration. Such arbitration shall take place in Boston, Massachusetts, unless
the parties otherwise mutually agree in writing, in accordance with the
employment rules of the American Arbitration Association and under the laws of
the Commonwealth of Massachusetts. Unless otherwise required by law, the parties
hereby agree to proceed before one impartial arbitrator selected by mutual
agreement of the parties. Any demand for arbitration hereunder shall be filed
within a reasonable time after the controversy or claim has arisen, but in no
event later than the date when the institution of legal or equitable proceedings
based on the claim would be barred by the statute of limitations under
applicable law. This arbitration provision may be specifically enforced in any
court of competent jurisdiction. Judgment upon the award rendered by the
arbitrator(s) may be entered in the federal and state courts in and of the
Commonwealth of Massachusetts.

 

15.                                 Waiver of Breach.  The waiver by the Company
or the Executive of a breach of any provision of this Agreement must be in
writing and shall not operate or be construed as a waiver of any subsequent
breach.

 

16.                                 Entire Agreement.  This Agreement
constitutes the entire agreement between the parties and supersedes all prior
agreements and understandings, whether written or oral, relating to the subject
matter of this Agreement.

 

17.                                 Severability.  Any provision in this
Agreement which is prohibited or unenforceable in any jurisdiction by reason of
applicable law shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating or affecting the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

18.                                 Counterparts.  This Agreement may be
executed in one or more counterparts, each of which shall be deemed to be an
original, but all of which together will constitute one and the same Agreement.

 

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IN WITNESS WHEREOF, the Executive and the Company have executed this Agreement
this 23rd day of September, 2009.

 

 

 

By:

/s/

Edward J. Faneuil

 

 

 

Edward J. Faneuil

 

 

 

 

 

ALLIANCE ENERGY LLC

 

 

 

 

 

By:

/s/ Richard Slifka

 

Name:

Richard Slifka

 

Title:

Treasurer

 

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