Exhibit
10.13

    


    

     

    August
13, 2009

     

    Mr.
Daniel Gilligan

    401 East
88th Street, Apt. 16C

    New York,
NY  10128

     

    Dear
Dan:

     

    This
letter will confirm our offer to you of employment with Katonah Debt Advisors,
L.L.C. (“KDA”) (the “Company”), under the terms and conditions that
follow.  This letter supersedes the letter agreement dated February
23, 2006 between you and KDA in its entirety effective as of the date
hereof.

    


    
      	
               
      

            	
              1.

            	
              Term, Position and
      Duties.

            


    

    


    
      	
               
      

            	
              (a)

            	
              You
      will be employed as a Director of Portfolio Administration.  You
      will report to the Portfolio Manager or Managers of various funds managed
      by the Company and any of its
affiliates.

            


    

    


    
      	
               
      

            	
              (b)

            	
              You
      agree to perform the duties of your position and such other duties as may
      reasonably be assigned to you from time to time including, but not limited
      to   overseeing trade settlement, trustee reporting, and
      other documentation concerning loans, bonds, and other instruments
      purchased or held by various types of collateralized loan obligation
      (“CLO”) funds, synthetic collateralized debt obligation (“CDO”) funds, and
      other credit-based funds (collectively “Funds”) as directed by the
      Portfolio Manager.  You also agree that you will devote your
      full business time and your best efforts, business judgment, skill and
      knowledge exclusively to the advancement of the business and interests of
      the Company.

            


    

    


    
      	
               
      

            	
              2.

            	
              Compensation and
      Benefits. During your employment, as compensation for all services
      performed by you for the Company and its Affiliates, the Company will
      provide you the following pay and
benefits:

            


    

    


    
      	
               
      

            	
              (a)

            	
              Base Salary.
      The Company will pay you a base salary at the rate of One Hundred Fifty
      Thousand Dollars ($150,000) per year, payable in accordance with the
      regular payroll practices of the Company and subject to increase from time
      to time by the Committee in its
discretion.

            


    

     


      
        

      

    

    295
Madison Avenue, 6th Floor
● New York, NY
10017

    Telephone
(212) 455-8300 ● Facsimile
(212) 983-7654

     

    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
2

            


    

     

    
      
        	
              	
                (b)

              	
                Bonus
      Compensation. During employment, you will be considered for a
      target annual minimum bonus of One Hundred and Twenty Five Thousand
      Dollars ($125,000) each calendar year. You will be considered for an
      increase in the annual bonus amount, solely at the discretion of the
      Committee, based on the future growth and performance of the
      Company.  Bonus awards will be determined by the Committee
      against goals established annually by the Portfolio Manager after
      consultation with you.  The bonus will be paid on or about
      January 31 of each succeeding calendar
year.

              


      

    

    


    
      	
               
      

            	
              (c)

            	
              Vacation.  You
      will be entitled to four (4) weeks paid vacation per calendar
      year.

            


    

    


    
      
        	
              	
                (d)

              	
                Participation in
      Employee Benefit Plans. You will be entitled to participate in all
      employee benefit plans from time to time in effect for employees of the
      Company generally, except to the extent such plans are duplicative of
      benefits otherwise provided you under this agreement.  Your
      participation will be subject to the terms of the applicable plan
      documents and generally applicable Company
  policies.

              


      

    

     

    
      	
               
      

            	
              3.

            	
              Confidential
      Information and Restricted
Activities.

            


    

     

    
      	
               
      

            	
              (a)

            	
              Confidential
      Information. During the course of your employment with the Company,
      you will learn of Confidential Information, as defined below, and you may
      develop Confidential Information on behalf of the Company.  You
      agree that you will not use or disclose to any Person (except as required
      by applicable law or for the proper performance of your regular duties and
      responsibilities for the Company) any Confidential Information obtained by
      you incident to your employment or any other association with the Company
      or any of its Affiliates.  You understand that this restriction
      shall continue to apply after your employment terminates, regardless of
      the reason for such termination.

            


    

     

    
      	
               
      

            	
              (b)

            	
              Protection of
      Documents. All documents, records and files, in any media of
      whatever kind and description, relating to the business, present or
      otherwise, of the Company or any of its Affiliates, and any copies, in
      whole or in part, thereof (the “Documents”), whether or not prepared by
      you shall be the sole and exclusive property of the Company. You agree to
      safeguard all Documents and to surrender to the Company, at the time your
      employment terminates or at such earlier time or times as the Committee or
      its designee may specify, all Documents then in your possession or
      control.

            


    

     

    
      	
               
      

            	
              (c)

            	
              Non-Competition.
      You acknowledge that in your employment with the Company you will have
      access to Confidential Information which, if disclosed, would assist in
      competition against the Company and its Affiliates and that you will also
      generate goodwill for the Company and its Affiliates in the course of your
      employment. Therefore, you agree that the following restrictions on your
      activities during and after your employment are necessary to protect the
      goodwill, Confidential Information and other legitimate interests of the
      Company and its Affiliates:

            


    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
3

            


    

     

    
      	
               
      

            	
              (i)

            	
              While
      you are employed by the Company and for six (6) months after your
      employment terminates (in the aggregate, the “Non-Competition Period”),
      you agree that you will not, without the prior written consent of the
      Company, directly or indirectly, own, manage, operate, join, control,
      finance, or participate in the ownership, marketing, management,
      operation, control, fundraising or financing of, or be connected as an
      officer, director, employee, partner, principal, agent, representative,
      consultant, or otherwise use or permit your name to be used in connection
      with any business or enterprise engaged in the United States in the
      business of structuring CDO or CLO securitization vehicles, analyzing and
      acquiring loans and other assets to be held by CDO or CLO vehicles,
      arranging for the issuance of debt and preferred securities by CDO or CLO
      vehicles, acting as collateral managers for such securitizations, or
      performing similar functions.

            


    

    


    
      	
               
      

            	
              (ii)

            	
              You
      agree that during the Non-Competition Period, you will not, directly or
      through any other Person, (i) hire any employee of the Company or any of
      its Affiliates or seek to persuade any employee of the Company or any of
      its Affiliates to discontinue employment, (ii) solicit or encourage any
      customer or investor of the Company or any of its Affiliates or
      independent contractor providing services to the Company or any of its
      Affiliates to terminate or diminish its relationship with them or (iii)
      seek to persuade any customer or investor or prospective customer or
      investor of the Company or any of its Affiliates to conduct with anyone
      else any business or activity that such customer or investor or
      prospective customer or investor conducts or could conduct with the
      Company or any of its Affiliates.

            


    

     

    
      	
               
      

            	
              (d)

            	
              In
      signing this agreement, you give the Company assurance that you have
      carefully read and considered all the terms and conditions of this
      agreement, including the restraints imposed on you under this Section
      3.  You agree without reservation that these restraints are
      necessary for the reasonable and proper protection of the Company and its
      Affiliates and that each and every one of the restraints is reasonable in
      respect to subject matter, length of time and geographic
      area.  You further agree that, were you to breach any of the
      covenants contained in this Section 3, the damage to the Company and its
      Affiliates would be irreparable.  You therefore agree that the
      Company, in addition to any other remedies available to it, shall be
      entitled to preliminary and permanent injunctive relief against any breach
      or threatened breach by you of any of those covenants, without having to
      post bond.  You and the Company further agree that, in the event
      that any provision of this Section 3 is determined by any court of
      competent jurisdiction to be unenforceable by reason of its being extended
      over too great a time, too large a geographic area or too great a range of
      activities, that provision shall be deemed to be modified to permit its
      enforcement to the maximum extent permitted by law.  It is also
      agreed that each of the Company's Affiliates shall have the right to
      enforce all of your obligations to that Affiliate under this agreement,
      including without limitation pursuant to this Section
  3.

            


    

    


    
      	
               
      

            	
              4.

            	
              Termination of
      Employment. Your employment under this agreement may be terminated
      at any time pursuant to this Section
4.

            


    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
4

            


    

    


    
      	
               
      

            	
              (a)

            	
              The
      Company may terminate your employment for cause upon notice to you setting
      forth in reasonable detail the nature of the cause.  The
      following shall constitute cause for termination:  (i) your
      repeated material failure to perform (other than by reason of disability),
      or gross negligence in the performance of, your duties and
      responsibilities to the Company or any of its Affiliates which failure is
      not cured within thirty (30) days after written notice of such failure or
      negligence is delivered to you; (ii) your material breach of this
      agreement or any other agreement between you and the Company or any of its
      Affiliates which breach is not cured within thirty (30) days after written
      notice of such breach is delivered to you; or (iii)  commission
      by you of a felony involving moral turpitude or fraud with respect to the
      Company or any of its Affiliates.  The Company also may
      terminate your employment at any time without cause upon notice to
      you.

            


    

    


    
      	
               
      

            	
              (b)

            	
              This
      agreement shall automatically terminate in the event of your death during
      employment, and you shall be entitled to the severance payments set forth
      under 5 (a) below.  In the event of your death, any amounts owed
      to you under this agreement will be paid to the beneficiary designated in
      writing by you or, if no beneficiary has been so designated by you, to
      your estate.  In the event you become disabled during employment
      and, as a result, are unable to continue to perform substantially all of
      your duties and responsibilities under this agreement, the Company will
      continue to pay you your base salary and to provide you benefits in
      accordance with Section 2(a) above, to the extent permitted by plan terms,
      for up to twelve (12) weeks of disability during any period of three
      hundred and sixty-five (365) consecutive calendar days.  If you
      are unable to return to work after twelve (12) weeks of disability, the
      Company may terminate your employment, upon written notice to you, and you
      shall be entitled to the severance payments set forth under 5(a)
      below.  If any question shall arise as to whether you are
      disabled to the extent that you are unable to perform substantially all of
      your duties and responsibilities for the Company and its Affiliates, you
      shall, at the Company's request, submit to a medical examination by a
      physician selected by the Company to whom you or your guardian, if any,
      has no reasonable objection to determine whether you are so disabled and
      such determination shall for the purposes of this agreement be conclusive
      of the issue.  If such a question arises and you fail to submit
      to the requested medical examination, the Company's determination of the
      issue shall be binding on you.

            


    

    


    
      	
               
      

            	
              (c)

            	
              You
      may terminate your employment hereunder for “Good Reason” by providing
      written notice to the Company of the condition giving rise to the Good
      Reason no later than thirty (30) days following the occurrence of the
      condition; by giving the Company thirty (30) days to remedy the condition;
      and, if the Company fails to remedy the condition, by terminating your
      employment within ten (10) days following the expiration of such thirty
      (30) day period.  For purposes of this letter agreement, the
      term “Good Reason” means, without your consent, the occurrence of one or
      more of the following events:  (i) material diminution in the
      nature or scope of your responsibilities, duties or authority as
      contemplated by this letter agreement; (ii) failure by the Company to pay
      the minimum Bonus Compensation set forth in 2(b) above in any year under
      this letter agreement if you have achieved the annual financial target
      referenced therein; or (iii) your being required to relocate to a
      principal place of employment outside of the New York metropolitan
      area.  For purposes of this paragraph 4(c) a change in reporting
      relationships resulting from a Change in Control will constitute Good
      Reason.  In addition, a termination of your employment by you
      for any reason during the 90-day period immediately following a Change in
      Control shall be deemed to be a termination for Good Reason for all
      purposes of this letter
agreement.

            


    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
5

            


    

    


    
      	
               
      

            	
              5.

            	
              Severance Payments and
      Other Matters Related to
Termination.

            


    

    


    
      	
               
      

            	
              (a)

            	
              In
      the event of termination of your employment by the Company without cause,
      the Company will continue to pay you your base salary (“severance
      payments”) and will continue to contribute to the premium cost of your
      health insurance on the same terms and conditions as it contributes for
      active employees provided that you make a timely election under the
      federal law known as “COBRA”.  The Company may, in its sole
      discretion, elect to cease the continuation of base salary and
      contributions toward health insurance premiums at any point after you have
      received six (6) months of base salary continuation and health insurance
      contributions (or one (1) year if you are terminated by the Company within
      ninety (90) days of the completion of a Change in Control) provided that
      it also releases you from your remaining obligation under Section 3(c)(i)
      above.  The Company will also pay you on the date of termination
      any base salary earned but not paid through the date of termination and
      pay for any vacation time accrued but not used to that date.  In
      addition, the Company will pay you any bonus compensation and profit
      sharing payment to which you are entitled in accordance with Sections 2(b)
      and 2(d) above, prorated to the date of termination and payable at the
      time such monies are payable to Company executives
      generally.  Any obligation of the Company to provide you
      severance payments or other payments or benefits under this Section 5(a)
      is conditioned, however, upon your signing and not revoking a release of
      claims in the form provided by the Company (the “Employee Release”), which
      shall be delivered to you not later than ten (10) business days following
      the date of termination and you shall be required to execute the Employee
      Release and return it to the Company, if at all, not later than the date
      determined by the Company to be the last day of the period it must provide
      to you by law to consider the Employee Release.  All severance
      payments will be in the form of salary continuation, payable in accordance
      with the normal payroll practices of the Company, and will begin at the
      Company's next regular payroll period following the effective date of the
      Employee Release, but shall be retroactive to the date of
      termination.  Notwithstanding anything else contained in this
      agreement, no bonus or severance payments or other payments or benefits
      will be due and payable under any provision of this Section 5(a) until the
      next regular Company payday following the effective date of the Employee
      Release.

            


    

    


    
      	
               
      

            	
              (b)

            	
              In
      the event of termination of your employment by the Company for cause or by
      you for any reason, the Company will pay you any base salary earned but
      not paid through the date of termination and pay for any vacation time
      accrued but not used to that date.  The Company shall have no
      obligation to you for any bonus or other incentive compensation, benefits
      continuation or severance
payments.

            


    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
6

            


    

    


    
      	
               
      

            	
              (c)

            	
              In
      the event of termination of your employment by death, or by disability,
      the Company will pay you any base salary earned but not paid through the
      date of termination, pay for any vacation time accrued but not used to
      that date, and any bonus or other incentive compensation to which you are
      entitled in accordance with Sections 2(b) and 2(c) above, prorated to the
      date of termination and payable at the time such bonuses are payable to
      Company executives generally.  The Company shall have no
      obligation to you for any severance payments or benefits
      continuation.

            


    

     

    
      	
               
      

            	
              (d)

            	
              Except
      for any rights you may have under Section 5(a) above or under the federal
      law known as “COBRA” to continue participation in the Company's group
      health and dental plans at your cost, benefits shall terminate in
      accordance with the terms of the applicable benefit plans based on the
      date of termination of your employment, without regard to any continuation
      of base salary or other payment to you following
      termination.  Your Option and/or Restricted Stock Agreement will
      govern your exercise, if any, of your option following termination of
      employment.

            


    

     

    
      	
               
      

            	
              (e)

            	
              Provisions
      of this agreement shall survive any termination if so provided in this
      agreement or if necessary or desirable to accomplish the purposes of other
      surviving provisions, including without limitation your obligations under
      Section 3 of this agreement.  The obligation of the Company to
      make payments to you under this Section 5 is expressly conditioned upon
      your continued full performance of obligations under Section 3
      hereof.   Upon termination by either you or the Company,
      all rights, duties and obligations of you and the Company to each other
      shall cease, except as otherwise expressly provided in this
      agreement.

            


    

     

    
      	
               
      

            	
              6.

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

            


    

    


    “Affiliates”
means all persons and entities directly or indirectly controlling, controlled by
or under common control with the Company, where control may be by management
authority, equity interest or otherwise.

    


    “Change
in Control” means:

    


    
      	
               
      

            	
              (i)

            	
              The
      acquisition by any person, entity or “group”, within the meaning of
      Section 13(d)(3) or 14(d)(2) of the Exchange Act, (excluding, for this
      purpose, the Company or its Affiliates) of beneficial ownership of 33% or
      more of either the then outstanding shares of the Company’s common stock
      or the combined voting power of the Corporation’s then outstanding voting
      securities entitled to vote generally in the election of
      directors.

            


    

     

    
      
         


      

      
        
        

        
          

        

      

      
         


      

    
 

    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
7

            


    

     

    
      	
               
      

            	
              (ii)

            	
              Individuals
      who, as of the date hereof, constitute the Board (the “Incumbent Board”)
      cease for any reason to constitute at least a majority of the Board,
      provided that any person who first becomes a director subsequent to the
      date hereof whose recommendation, election or nomination for election by
      the Company’s stockholders was approved by a vote of at least a majority
      of the directors then comprising the Incumbent Board (other than an
      election or nomination of an individual whose initial assumption of office
      is in connection with an actual or threatened election contest relating to
      the election of the directors of the Company as described in Rule 14a-11
      of Regulation 14A promulgated under the Exchange Act) shall be, for the
      purposes of this Agreement, considered as though such person were a member
      of the Incumbent Board; or

            


    

    


    
      	
               
      

            	
              (iii)

            	
              Approval
      by the stockholders of the Company of a reorganization
      share  exchange, merger or consolidation with respect to which,
      in any such case, the persons who were the stockholders of the Company
      immediately prior to such reorganization, share exchange, merger or
      consolidation do not, immediately thereafter, own more than 50% of the
      combined voting power entitled to vote in the election of directors of the
      reorganized, merged or consolidated company;
or

            


    

    


    
      	
               
      

            	
              (iv)

            	
              Liquidation
      or dissolution of the Company or a sale of all or substantially all of the
      assets of the Company.

            


    

    


    “Confidential
Information” means any and all information of the Company and its Affiliates
that is not generally available to the public. Confidential Information also
includes any information received by the Company or any of its Affiliates from
any Person with any understanding, express or implied, that it will not be
disclosed.  Confidential Information does not include information that
enters the public domain, other than through your breach of your obligations
under this agreement.

    


    “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 or any of its Affiliates.

    


    
      	
               
      

            	
              7.

            	
              Conflicting
      Agreements. You hereby represent and warrant that your signing of
      this agreement and the performance of your obligations under it will not
      breach or be in conflict with any other agreement to which you are a party
      or are bound and that you are not now subject to any covenants against
      competition or similar covenants or any court order that could affect the
      performance of your obligations under this agreement.  You agree
      that you will not disclose to or use on behalf of the Company any
      proprietary information of a third party without that party's
      consent.

            


    

    


    
      	
               
      

            	
              8.

            	
              Withholding.
      All payments made by the Company under this agreement shall be reduced by
      any tax or other amounts required to be withheld by the Company under
      applicable law.

            


    

     

    
      	
               
      

            	
              9.

            	
              Assignment.
      Neither you nor the Company may make any assignment of this agreement or
      any interest in it, by operation of law or otherwise, without the prior
      written consent of the other; provided, however, that the Company may
      assign its rights and obligations under this agreement without your
      consent to one of its Affiliates or to any Person with whom the Company
      shall hereafter affect a reorganization, consolidate with, or merge into
      or to whom it transfers all or substantially all of its properties or
      assets.  This Agreement shall inure to the benefit of and be
      binding upon you and the Company, and each of our respective successors,
      executors, administrators, heirs and permitted
  assigns.

            


    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    
      	
              Mr.
      Daniel Gilligan

            	 
      
	
              August 13, 2009

            	
              Page
8

            


    

    


    
      	
            	
              10.

            	
              Severability.
      If any portion or provision of this agreement shall to any extent be
      declared illegal or unenforceable by a court of competent jurisdiction,
      then the remainder of this agreement, or the application of such portion
      or provision in circumstances other than those as to which it is so
      declared illegal or unenforceable, shall not be affected thereby, and each
      portion and provision of this agreement shall be valid and enforceable to
      the fullest extent permitted by
law.

            


    

      

    
      	
            	
              11.

            	
              Miscellaneous.
      This agreement sets forth the entire agreement between you and the Company
      and replaces all prior and contemporaneous communications, agreements and
      understandings, written or oral, with respect to the terms and conditions
      of your employment.  This agreement may not be modified or
      amended, and no breach shall be deemed to be waived, unless agreed to in
      writing by you and an expressly authorized representative of the
      Committee.  The headings and captions in this agreement are for
      convenience only and in no way define or describe the scope or content of
      any provision of this Agreement.  This agreement may be executed
      in two or more counterparts, each of which shall be an original and all of
      which together shall constitute one and the same instrument. This is a
      Delaware contract and shall be governed and construed in accordance with
      the laws of the State of Delaware, without regard to the conflict of laws
      principles thereof.

            


    

      

    
      	
            	
              12.

            	
              Notices.
      Any notices provided for in this agreement shall be in writing and shall
      be effective when delivered in person or deposited in the United States
      mail, postage prepaid, and addressed to you at your last known address on
      the books of the Company or, in the case of the Company, to it at its
      principal place of business, attention of the Committee, or to such other
      address as either party may specify by notice to the other actually
      received.

            


    

    


    If the
foregoing is acceptable to you, please sign this letter in the space provided
and return it to me at your earliest convenience.  We will provide a
countersigned copy for your records.

    


    
      
        
          
            	
                    Sincerely
      yours,

                  
	 
      
	
                    
                      /s/
      E.A. Kratzman

                    

                  
	
                    
                      E.A.
      Kratzman

                    

                  
	
                    
                      President
      and Portfolio
Manager

                    

                  


          

        

      

    

     

    Accepted
and agreed:

     

    
      
        
          	
                  
                    /s/
      Daniel Gilligan

                  

                
	
                  
                    Daniel
      Gilligan

                  

                


        

      

    

    


    
      
        
          	
                  August 13, 2009

                
	
                  Date

                


        

      

    

    


    cc:  Michael
Wirth