Exhibit 10.4


 


AMENDMENT NO. 1
TO EMPLOYMENT AGREEMENT


 


This Amendment No. 1 (“Amendment”) to that certain
Employment Agreement between Deerfield Capital Management LLC, a Delaware
limited liability company (“Deerfield”), and Jonathan W. Trutter (“Employee”), dated as of June 26,
2004 (“Original Employment Agreement”),
is made and entered into as of the 11th day of May, 2009.  Any capitalized term not otherwise defined
herein shall have the same meaning given to such term in the Original
Employment Agreement.


 


W  I
T  N  E  S  S  E  T  H


 


WHEREAS, the Original
Employment Agreement expires pursuant to its terms on or about June 25,
2009;


 


WHEREAS, Deerfield
wishes to retain the services of Employee for an additional period, and
Employee wishes to provide services to Deerfield, on amended terms and
conditions; and


 


WHEREAS, Deerfield and
Employee agree that certain terms and conditions of the Original Employment
Agreement must be amended, with all other terms and conditions to remain in
full force and effect,


 


NOW, THEREFORE, in
consideration of the covenants and agreements herein contained and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Deerfield and Employee agree that following sections shall
supersede and replace in their entirety the corresponding sections of the
Original Employment Agreement:


 


1.             Employment.


 


(a) Term.  The term of Employee’s employment under this
Agreement shall commence on June 25, 2009, and shall conclude on December 31,
2010, unless sooner terminated according to Section 3 of this Agreement
(the “Term”).  Except as provided
in Section 8(i) of this Agreement, or as is otherwise agreed in
writing between the parties, this Agreement shall terminate upon expiration of
the Term.


 


2.             Compensation and Benefits.


 


(b)           Bonus.


 


(i)            Guaranteed Bonus.  Deerfield shall pay to Employee a cash bonus
for services rendered during fiscal year 2009 in an amount equal to the cash
bonus Employee received from Deerfield for fiscal year 2008 (which was $783,750).  Further, subject to the terms of this Section 2(b)(i),
Deerfield shall pay to Employee a cash bonus for services rendered during
fiscal year 2010 in an amount equal to Fifty Percent 


 


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(50%) of the cash bonus Employee received
from Deerfield for fiscal year 2008.  The
bonus for fiscal year 2009 shall be paid to Employee no later than March 15,
2010 in accordance with Deerfield’s standard bonus payment policies, and the
bonus for fiscal year 2010 shall be paid to Employee no later than March 15,
2011 in accordance with Deerfield’s standard bonus payment policies; provided,
however, that Employee must be an employee of Deerfield at the time the payment
of the respective bonus is due.


 


Notwithstanding the foregoing, in the event a
Change of Control (as such term is defined as of the date hereof in Deerfield’s
First Amended and Restated Stock Incentive Plan) occurs during fiscal year
2010, the amount of the bonus Employee shall be entitled to receive for services
rendered in fiscal year 2010 shall be increased to an amount equal to One
Hundred Percent (100%) of the cash bonus Employee received from Deerfield for
fiscal year 2008 if, following such Change of Control, Employee is either
terminated without Cause or Employee’s duties and responsibilities are
substantially diminished from his duties and responsibilities in effect as of
the date hereof.


 


(d)           Intentionally
omitted.


 


3.             Termination.


 


(a) Termination
by Deerfield without Cause; Termination by Employee for Good Reason.


 


(i)            This
Agreement and Employee’s employment may be terminated at any time prior to December 31,
2010, by Deerfield without “Cause” (as defined below) (other than by
reason of Employee’s death or “Disability” (as defined below)) following
the delivery of a “Notice of Termination” (as defined below) to
Employee. In addition, this Agreement and Employee’s employment hereunder may
be terminated at any time prior to December 31, 2010 by Employee for “Good
Reason” (as defined below) following the delivery of a Notice of
Termination to Deerfield.


 


(ii)           If Employee’s
employment is terminated by Deerfield without Cause (other than by reason of
Employee’s death or Disability) or by Employee for Good Reason (A) Employee
shall be entitled to receive any unpaid Guaranteed Bonus payments) for fiscal
year 2009 and fiscal year 2010 as set forth in Section 2(b)(i) and in
accordance with the normal bonus payment practices of Deerfield, (B) Employee
shall continue to receive the Base Salary Employee would have received through December 31,
2010 in accordance with the normal payroll payment practices of


 


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Deerfield
and (C) Deerfield will pay the Employee the Retention Bonus within 90 days
following the fifth anniversary of the Effective Date to the extent it has not
been previously paid.  Except as set
forth above, Employee shall have no further rights to any compensation
(including any Base Salary or bonus) or any other benefits under this
Agreement.  All other benefits, if any,
due Employee following a termination pursuant to this Section 3(a) shall
be determined in accordance with the plans, policies and practices of
Deerfield; provided, however, that Employee shall not participate in any
severance plan, policy or program of Deerfield.


 


(b)           Termination
for Cause.


 


(iii)          In
the event Employee’s employment is terminated pursuant to this Section 3(b),
Employee shall be entitled to receive Employee’s Base Salary through the date
of termination and any earned but unpaid bonus for any fiscal year preceding
the fiscal year in which the termination occurs. Employee shall have no further
rights to any compensation or any other benefits under this Agreement.  All other benefits, if any, due Employee
following a termination pursuant to this Section 3(b) shall be
determined in accordance with the plans, policies and practices of Deerfield;
provided, however, that Employee shall not participate in any severance plan,
policy or program of Deerfield.


 


(c)           Termination due to Death or
Disability.  This Agreement and
Employee’s employment shall terminate immediately upon Employee’s death or,
following delivery of a Notice of Termination by Deerfield to Employee, due to
Employee’s Disability. In the event Employee’s employment is terminated
pursuant to this Section 3(c), Employee (or Employee’s estate, as the case
may be) shall be entitled to receive Employee’s Base Salary through the date of
termination and any earned but unpaid bonus for any fiscal year preceding the
fiscal year in which the termination occurs. 
Employee (or Employee’s estate, as the case may be) shall have no
further rights to any compensation (including any Base Salary or bonus) or any
other benefits under this Agreement.  All
other benefits, if any, due Employee (or Employee’s estate, as the case may be)
following a termination pursuant to this Section 3(c) shall be
determined in accordance with the plans, policies and practices of Deerfield;
provided, however, that Employee (or Employee’s estate, as the case may be)
shall not participate in any severance plan, policy or program of Deerfield.
For purposes of this Agreement, “Disability” shall mean: Employee’s
physical or mental incapacity as a result of which Employee is unable for a
period of ninety (90) days during any one hundred eighty (180) day period to
perform Employee’s duties with substantially the same level of quality as
immediately prior to such incapacity.


 


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6.             Non Competition and Other
Covenants.


 


(a)           Employee reaffirms all obligations
and commitments in the letter agreement between Employee and Deerfield dated April 9,
2009 (“April 2009 Letter Agreement”).


 


(b)           In addition to the obligations and
commitment in Section 6(a) of this Agreement, as amended, during the
term of this Agreement and for a period equal to the earlier of two years from
the date Employee’s employment is terminated for any reason and December 31,
2012 (except as otherwise provided in Section 6(b)(i) below), Employee
shall not:


 


(i)            engage
in any Prohibited Competition Activity anywhere in the United States of America;
provided, however, that, solely with respect to the Prohibited Competition
Activity described in clause (ii) of the definition thereof, the obligations
and commitment set forth in this Section 6(b)(i) shall be applicable only for a
period equal to the earlier of six months from the date of the last payment of
Base Salary to Employee required by Section 3 of this Agreement and July 1,
2011.  Employee acknowledges and agrees
that the market for Investment Management Services rendered by Employee on
behalf of Deerfield includes the entire United States of America;


 


(ii)           solicit
or induce, whether directly or indirectly, any Person for the purpose (which
need not be the sole or primary purpose) of (A) causing any funds (other
than funds of which Employee and/or members of Employee’s Immediate Family are
the sole beneficial owners) with respect to which Deerfield or any of its
Affiliates provides Investment Management Services to be withdrawn from such
management, or (B) causing any Client (including any Potential Client) not
to engage Deerfield or any of its Affiliates to provide Investment Management
Services for any additional funds; provided, however, that this clause (ii)(B) shall
not be applicable to Clients (including Potential Clients) who are also members
of the Immediate Family of Employee;


 


(iv)          (A) solicit
or induce, or attempt to solicit or induce, directly or indirectly, any
employee or agent of, or consultant to, Deerfield or any of its Affiliates to
terminate its, his or her relationship therewith, or (B) hire or engage
any employee, external researcher or similar agent or consultant, or former
employee, external researcher or similar agent or consultant of Deerfield or
any of its Affiliates who was employed by or acted as an external researcher or
similar agent or consultant of Deerfield or any of its Affiliates at any time
during the eighteen (18) month period preceding such hiring or engagement of
such Person.


 


8.             Miscellaneous.


 


(g)           Entire Agreement. This
Agreement constitutes the entire agreement between the parties as of the
Effective Date and supersedes all previous agreements and understandings
between the parties with respect to the subject matter hereof, including
Employee’s employment agreement with Deerfield and D&C dated January 1,
2002 (the “Prior Employment Agreement”), except for the April 2009
Letter Agreement and the letter agreement between 


 


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Employee and Deerfield dated
May 11, 2009, which shall remain in full force and effect.


 


(k)           Intentionally
omitted.


 


Except as specifically amended herein, all
provisions of the Original Employment Agreement remain in effect through the
entire Term.


 


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IN WITNESS WHEREOF, the parties
hereto have executed this Amendment as of the date first written above.


 


	
  Date:

  	
  May 11, 2009

  	
   

  
	
   

  	
   

  
	
  EMPLOYEE

  	
  DEERFIELD CAPITAL
  MANAGEMENT LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Jonathan W.
  Trutter

  	
   

  	
  /s/ Robert A.
  Contreras

  
	
  Jonathan W. Trutter

  	
   

  	
  By: Robert A. Contreras

  
	
   

  	
  Its: General Counsel

  
				



 


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