exh10_3.htm


     

    
      

      

    

    Exhibit 10.3

    


    EMPLOYMENT
AGREEMENT

     

    Amended and
Restated as of December 29, 2008

     

    This
Amended and Restated Employment Agreement (“Agreement”)
is dated as of December 29, 2008 by and between RESOURCE AMERICA, INC., a
Delaware corporation having its principal place of business at 1 Crescent Drive,
Suite 203, Navy Yard, Philadelphia, Pennsylvania 19112 (“RAI”)
and STEVEN J. KESSLER (“Kessler”).

     

    BACKGROUND

     

    WHEREAS,
Kessler and RAI are parties to an Employment Agreement dated October 5, 1999
(“Existing Agreement”); and

     

    WHEREAS, RAI
and Kessler desire to amend the Existing Agreement to comply with section 409A
of
the Code (as defined below) and to make other appropriate changes to
comply with applicable law.

     

    TERMS

     

    NOW,
THEREFORE, in consideration of the mutual promises set forth herein, and
intending to be legally bound hereby, RAI and Kessler agree that the Existing
Agreement is amended and restated to read as follows:

     

    1.           Employment.  During
the term of this Agreement, Kessler shall be employed as the Executive Vice
President and Chief Financial Officer of RAI.

     

    2.           Duties.  Kessler
shall report to and accept direction from the Chairman of the Board (as defined
below) and from the Board.  Kessler shall serve RAI diligently and to
the best of his abilities, but Kessler shall be required to devote only
so much of his time and attention to the business of RAI as may be required to
fulfill his duties.  It is recognized that Kessler in the past has
participated, and it is agreed that Kessler in the future may participate in
business endeavors separate and apart from RAI.

     

    3.           Term.  Kessler’s
employment hereunder shall continue in full force and effect for a period of
three (3) years, unless sooner terminated in accordance with the provisions
hereof.  Such term shall automatically extend so that on any day that
this Agreement is in effect, it shall have a then current term of three (3)
years.  Such automatic extensions shall cease upon RAI’s written
notice to Kessler of its election to terminate this Agreement at the end of the
three (3) year period then in effect.

     

    4.           Compensation.

     

                  a)           Base
Compensation.  During the period of employment, RAI shall pay
to Kessler “Base Compensation” to
be established by the Board, which was initially as of the date of the Existing
Agreement in an amount equal to Three Hundred Thousand Dollars ($300,000) per
annum base compensation (the “Initial
Level”).  The Base Compensation will be payable in accordance
with the general payroll practices by which RAI pays its executive officers,
and the historical practice of RAI’s compensation of Kessler.  It is
understood that RAI, through the compensation committee of the Board, will
review Kessler’s performance on an annual basis and increase or decrease (but in
no event below the Initial Level) such Base Compensation, based upon Kessler’s
performance.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    b)           Incentive
Compensation.  During the period of employment Kessler may
receive incentive compensation in the form of cash bonus payments, stock option
grants and other forms of incentive compensation, based upon Kessler’s
performance.

     

    c)           Reimbursement of
Expenses.  RAI shall reimburse Kessler for all reasonable
expenses incurred by Kessler in the performance of his duties, including
(without limitation) expenses incurred during business-related
travel.

     

    5.
          Benefits.

     

    Kessler
shall be entitled to receive the following benefits from RAI independent of any
other benefits which Kessler may receive from RAI or otherwise:

     

    a)           Participation in
Benefit Plans.  Kessler will participate in all employee
benefit plans in effect during the term of Kessler’s employment
hereunder.

     

    b)           Temporary
Disability.  During any period that Kessler fails to perform
his duties hereunder as a result of incapacity due to physical or mental illness
Kessler shall continue to receive his full compensation at the rate then in
effect for such period until his employment is terminated pursuant to paragraph
6(b) hereof.

     

    6.           Termination.

     

    Kessler’s
employment hereunder shall terminate as follows:

     

    a)           Death.  Kessler’s
employment shall terminate automatically upon the death of Kessler.

     

    b)           Disability.  RAI
may terminate this Agreement if Kessler becomes disabled by reason of any
physical or mental disability whatsoever for more than two hundred forty (240)
days in the aggregate during any calendar year and the Board determines, that
Kessler, by reason of such physical or mental disability, is rendered unable to
perform his duties and services hereunder (a “Disability”);

     

    c)           Termination
by Kessler for Cause.  Kessler
may terminate his employment for “cause” upon thirty (30) days’ prior written
notice to RAI, which notice shall set forth the grounds for such
termination.  The notice must be provided within sixty (60) days after
the event giving rise to the termination for “cause” occurs.  RAI
shall have a period of thirty (30) days during which it may cure any condition
reasonably susceptible of cure.  If RAI does not correct the grounds
for termination during the thirty (30) day period following the notice of
termination, Kessler’s termination of employment for “cause” must become
effective within thirty (30) days after the end of the cure period, in order for
such termination to be treated as a termination for “cause” under this
Agreement.  For the
purposes of this paragraph 6(c), “cause” shall be
deemed to exist if any of the following shall occur: (i) without the written
consent of Kessler, a substantial change in the services or duties required of
Kessler hereunder or the imposition of any services or duties substantially
inconsistent with, or in diminution of Kessler’s current position, services
or  duties, or status with RAI; (ii) failure to continue Kessler’s
coverage under any RAI benefit plan as required under paragraph 5(a) except
pursuant to a change to a benefit plan that applies to senior executives of RAI
generally or is required by law or regulation; or (iii) any material breach by
RAI of any provision of this Agreement;

    
      
        
        

      

      
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    d)           Termination by
Kessler Without Cause.  Kessler may terminate this Agreement
without cause upon one hundred eighty (180) days prior written notice to
RAI.

     

    e)           Change of
Control.  Kessler may, in his discretion, terminate his
employment upon a Change of Control by sending a Notice of
Termination.

     

    f)           Termination
by RAI.  Subject
to the requirements of Section 7, RAI may terminate this Agreement for any
reason upon sixty (60) days prior written notice to
Kessler.

     

    7.           Effect
of Termination.

     

    a)           Death.  Upon
the termination of Kessler’s employment pursuant to paragraph 6(a) hereof due to
Kessler’s death, a death benefit shall be paid to Kessler’s estate equal to the
total amount payable to Kessler under this Agreement until expiration of the
term in effect as of Kessler’s Date of Termination, as provided under Section 3,
assuming that Kessler’s total compensation for each year would be equal to the
Average Compensation.  The amount to be paid under this Section shall
be paid as described in Section 7(d).

     

    b)           Disability.  Upon
the termination of Kessler’s employment pursuant to paragraph 6(b) hereof due to
Kessler’s Disability, Kessler shall be entitled to receive compensation equal to
the product of (i) the Average Compensation, multiplied by (ii) seventy-five
percent (75%).  The amount to be paid under this Section shall be paid
as described in Section 7(d) and shall not be reduced by any payments made
directly to Kessler by an insurance company.

     

                    c)           For Cause; Change of
Control.  Upon the termination of this Agreement either (i) by
Kessler for cause pursuant to paragraph 6(c) hereof, (ii) by Kessler pursuant to
paragraph 6(e) after a Change of Control or (iii) by RAI pursuant to section
6(f) hereof, then RAI shall provide to Kessler the benefits described (the
“Severance
Benefits”).  All Severance Benefits shall be paid as described
in Section 7(d).

     

    (1)           Severance
Payment.  In lieu of any further compensation payments to
Kessler for periods subsequent to the Date of Termination, RAI shall pay to
Kessler an amount equal to the sum of the total amount payable to Kessler under
this Agreement until expiration of the term in effect as of Kessler’s Date of
Termination, as provided under Section 3, assuming that Kessler’s total
compensation for each year would be equal to the Average
Compensation.

     

    (2)           Benefits.

     

    
      
        
        

      

      
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      (A)           During
the thirty-six (36)-month period following Kessler’s Date of Termination (the
“Separation Period”), Kessler may elect continued health coverage under RAI’s
health plan in which Kessler participated at the Date of Termination, as in
effect from time to time, provided that Kessler shall be responsible for paying
the full monthly cost of such coverage, which shall be equal to the premium
determined for purposes of continued coverage under section 4980B(f)(4) of the
Code (“COBRA Premium”) in effect from time to time.

       

      (B)           RAI
shall pay Kessler an amount equal to the COBRA Premium cost of continued health
coverage under RAI’s health plan for the Separation Period, less the premium
charge that is paid by RAI employees for such coverage, as in effect on
Kessler’s Date of Termination.  The cash payments under this
subsection (B) shall be increased by a tax gross up payment equal to Kessler’s
income and FICA tax imposed on the payment under this subsection
(B).

    

     

    (C)           RAI
shall pay Kessler an amount equal to the cost that RAI would incur for life,
disability and accident insurance coverage (as calculated below) for the
Separation Period as if Kessler had continued in employment and participated in
RAI’s plans, less the premium charge that is paid by active RAI employees for
such coverage as in effect at Kessler’s Date of Termination.  The
monthly cost of disability, life and accident insurance coverage shall be
calculated based on RAI’s monthly cost of such coverage on Kessler’s Date of
Termination. The cash payments under this subsection (C) shall be increased by a
tax gross up payment equal to Kessler’s income and FICA tax imposed on the
payment under this subsection (C).

     

                    (d)           Payment
Provisions.

     

    (1)           Except
as provided in subsection (2) below, all amounts paid upon Kessler’s termination
of employment as described in Sections 7(a), 7(b), and 7(c) shall be payable in
regular payroll installments over the applicable period described in such
Sections .  Such installments shall commence within thirty (30) days
after the date of Kessler’s Date of Termination, subject to Kessler’s delivery
to RAI of an effective release of all claims against RAI and its affiliates in
the standard form provided by RAI for employee terminations (“Release”)
and Kessler’s compliance with Section 12 below. Notwithstanding anything to the
contrary in this Agreement, if RAI is paying Severance Benefits to Kessler
pursuant to this Section 7(d), then COBRA Premiums paid pursuant to Section
7(c)(2)(B) shall be paid by RAI to Kessler only for the period during which
Kessler elects to participate in continued
health coverage under RAI’s health plan.  Notwithstanding anything in
this subsection (d) to the contrary, no Release shall be required with respect
to death benefits under Section 7(a)

     

    (2)           If
Kessler’s employment is terminated upon or within two (2) years after a Change
of Control that is a 409A Change of Control, all amounts paid as upon Kessler’s
termination of employment as described in Sections 7(a), 7(b), and 7(c) shall be
payable in a single lump sump payment instead of installments.  The
lump sum payment shall be made within thirty (30) days after Kessler’s Date of
Termination, subject to Kessler’s delivery to RAI of an effective Release and
compliance with Section 12 below.  For purposes of determining the
amounts
to be paid pursuant to Section 7(c)(2)(B) and Section 7(c)(2)(C), the single
lump sum payment shall equal the total amount that would otherwise have been
paid to Kessler under Section 7(c)(2)(B) and Section 7(c)(2)(C) for the duration
of the Separation Period. as determined as of the Date of
Termination.

     

    
      
        
        

      

      
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    (3)           Notwithstanding
the foregoing, all payments that are subject to the section 409A six-month delay
shall be postponed as described in Section 12 below.

     

    (4)           Vesting of
Options.  Upon any termination of this Agreement, the vesting
of all options to purchase securities of RAI granted to Kessler during his
employment with RAI shall be accelerated to the later of the effective date of
termination of this Agreement, or six (6) months after the date such option was
granted, and any provision contained in the agreements under which such options
were granted that is inconsistent with such acceleration is hereby modified to
the extent necessary to provide for such acceleration; such acceleration shall
not apply to any option that by its terms would vest prior to the date provided
for in this paragraph 7(d).

     

    8.           Gross-Up
Payment.

     

    a)           In
the event that (i) Kessler becomes entitled to any benefits or payments in
connection with the termination of Kessler’s employment, whether pursuant to the
terms of this Agreement or otherwise, including without limitation the Severance
Benefits (collectively, the “Total
Benefits”), and (ii) any of the Total Benefits will be subject to the
Excise Tax, RAI shall pay to Kessler an additional amount (the “Gross-Up
Payment”) such that the net amount retained by Kessler, after deduction
of any Excise Tax on the Total Benefits and any federal, state and local income
taxes, Excise Tax, and FICA and Medicare withholding taxes upon the payment
provided for by this paragraph 8(a), shall be equal to the Total
Benefits.  For purposes of determining whether any of the Total
Benefits will be subject to the Excise Tax and the amount of such Excise Tax,
the amount of the Total Benefits that shall be treated as subject to the Excise
Tax shall be equal to the amount of the Total Benefits reduced by the amount of
such Total Benefits that, in the opinion of tax counsel selected by Kessler, at
RAI’s expense and reasonably acceptable to RAI (“Tax
Counsel”), are not excess parachute payments (within the meaning of
section 28OG(b)(1) of the Code).

     

    b)           For
purposes of this Section 8, Kessler shall be deemed to pay federal income taxes
at the highest marginal rate of federal income taxation in the calendar year in
which the Excise Tax is (or would be) payable and state and local income taxes
at the highest marginal rate of taxation in the state and locality of Kessler’s
residence on the Date of Termination, net of the reduction in federal income
taxes which could be obtained from deduction of such state and local taxes
(calculated by assuming that any reduction under section 68 of the Code in the
amount of itemized deductions allowable to Kessler applies first to reduce the
amount of such state and local income taxes that would otherwise be deductible
by Kessler).  Except as otherwise provided herein, all determinations
required to be made under this Section 8 shall be made by Tax
Counsel.

     

    c)           In
the event that the Excise Tax is subsequently determined to be less than the
amount taken into account hereunder at the time of termination of Kessler’s
employment,

     

    
      
        
        

      

      
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    Kessler
shall repay to RAI, at the time that the amount of such reduction in Excise Tax
is finally determined, the portion of the Gross-Up Payment attributable to such
reduction (plus that portion of the Gross-Up Payment attributable to the Excise
Tax, federal, state and local income taxes and FICA and Medicare withholding
taxes imposed on the Gross-Up Payment being repaid by Kessler to the extent that
such repayment results in a reduction in Excise Tax, FICA and Medicare
withholding taxes and/or a federal, state or local income tax deduction) plus
interest on the amount of such repayment at the rate provided in section
1274(b)(2)(B) of the Code.  In the event that the Excise Tax is
determined to exceed the amount taken into account hereunder at the time of the
termination of Kessler’s employment (including by reason of any payment the
existence or amount of which cannot be determined at the time of the Gross-Up
Payment), RAI shall make an additional Gross-Up Payment to Kessler in respect of
such excess (plus any interest, penalties or additions payable by Kessler with
respect to such excess) at the time that the amount of such excess is finally
determined.

     

    (d)           Any
Gross-Up Payment shall be paid by RAI to Kessler within five (5) days of receipt
of the Tax Counsel’s determination, but in any event not later than the end of
the calendar year in which the related taxes are remitted to the taxing
authority.

     

    9.           Indemnification.

     

    a)           If
Kessler is made a party or is threatened to be made a party to or is involved in
any action, suit or proceeding, whether civil, criminal, administrative or
investigative (herein a “proceeding”), by reason of the fact that he is or was
an employee (which term includes officer, director, agent and any other
capacity) of RAI or is or was serving at the request of RAI as an employee or
agent of another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans, whether
the basis of such proceeding is alleged action in an official capacity as an
employee or agent or in any other capacity while serving as an employee or
agent, Kessler shall be indemnified and held harmless by RAI to the fullest
extent authorized by applicable law, against all expense, liability and loss
(including, but not limited to, attorneys’ fees, judgments, fines, ERISA excise
taxes and penalties and amounts paid or to be paid in settlement) incurred or
suffered by Kessler in connection therewith and such indemnification shall
continue as to Kessler after he has ceased to be a director, officer, employee
or agent and shall inure to the benefit of Kessler’s heir, executors, and
administrators; provided, however, that RAI shall indemnify any such person
seeking indemnification in connection with a proceeding (or part thereof)
initiated by Kessler (other than a proceeding to enforce this paragraph 9) only
if such proceeding (or part thereof) was authorized directly or indirectly by
the Board of RAI.  The right to indemnification conferred in this
paragraph shall be a contract right and shall include the right to be, promptly
upon request, paid by RAI the expenses incurred in defending any such proceeding
in advance of its final disposition; provided, however, that if the Business
Corporation Law of the Commonwealth of Pennsylvania requires the payment of such
expenses incurred by an employee in his capacity as an employee (and not in any
other capacity in which service was or is rendered by such person while a
director or officer, including, without limitation, service to an employee
benefit plan) in advance of the final disposition of a proceeding, payment shall
be made only upon delivery to RAI  of an undertaking, by or on behalf
of Kessler, to repay all amounts so advanced if it shall ultimately be
determined that such employee is not entitled to be indemnified under this
paragraph or otherwise.

    


    
      
        
        

      

      
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    b)           The
indemnification provided by this paragraph shall not be limited or exclude any
rights, indemnities or limitations of liability to which Kessler may be
entitled, whether as a matter of law, under the Certificate of Incorporation,
By-laws of RAI, by agreement, vote of the stockholders or disinterested
directors of RAI or otherwise.

     

    c)           Kessler,
in seeking indemnification under this Agreement (an “Indemnitee”),
shall give the other party or parties (the “Indemnitor”)
prompt written notice of any claim, suit or demand that the Indemnitee believes
will give rise to indemnification under this Agreement; provided, however, that
the failure to give such notice shall not affect the liability of the Indemnitor
under this Agreement unless the failure to give such notice materially and
adversely affects the ability of the Indemnitor to defend itself against or to
cure or mitigate the damages.  Except as hereinafter provided, the
Indemnitor shall have the right (without prejudice to the right of the
Indemnitee to participate at its expense through counsel of its own choosing) to
defend and to direct the defense against any such claim, suit or demand, at the
Indemnitor’s expense and with counsel chosen jointly by Indemnitor and
Indemnitee, and the right to settle or compromise any such claim, suit or
demand; provided, however, that the Indemnitor shall not, without the
Indemnitee’s written consent, which shall not be unreasonably withheld, settle
or compromise any claim or consent to any entry of judgment.  The
Indemnitee shall, at the Indemnitor’s expense, cooperate in the defense of any
such claim, suit or demand.  If the Indemnitor, within a reasonable
time after notice of a claim fails to defend the Indemnitee, the Indemnitee
shall be entitled to undertake the defense, compromise or settlement of such
claim at the expense of and for the account and risk of the
Indemnitor.

     

    d)           Kessler
will be covered during the entire term of this Agreement by Officer and Director
liability insurance in amounts and on terms similar to that afforded to other
executives and/or directors of RAI or its affiliates, which such insurance shall
be paid by RAI.

     

    10.           Definitions.  Any
terms not otherwise defined herein shall have the following
meaning:

     

    a)           “Average
Compensation” means the average of the three highest amounts of annual
total compensation received by Kessler during any of the then current calendar
year (on an annualized basis) and the then preceding eight (8) calendar
years.

     

    b)           “Board”
means the Board of Directors of RAI.

     

    c)           A
“Change of
Control” means the occurrence of any of the following
events:

     

    (A)           Consummation
of a merger, consolidation, share exchange, division or other reorganization or
transaction of RAI (a “Fundamental Transaction”) with any other corporation,
other than a Fundamental Transaction which would result in the voting securities
of RAI outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least sixty percent (60%) of the combined voting power
immediately after such Fundamental Transaction of (i) RAI’s outstanding
securities, (ii) the surviving entity’s outstanding securities, or (iii)
in the case of a division, the outstanding securities of each entity resulting
from the division;

     

    
      
        
        

      

      
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    (B)           Consummation
of a plan of complete, liquidation or winding-up of RAI or an agreement for the
sale or disposition (in one transaction or a series of transactions) of all or
substantially all of RAI’s assets;

     

    (C)           During
any period of twenty-four consecutive months, individuals who at the beginning
of such period constituted the Board (including for this purpose any new
director whose election or nomination for election by RAI’s shareholders was
approved by a vote of at least two-thirds (2/3) of the directors then still in
office who were directors at the beginning of such period) cease for any reason
to constitute at least a majority of the Board; or

     

    d)           “Code”
means the Internal Revenue Code of 1986, as amended from time to
time.

     

    e)           “Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to
time.

     

    f)           “Excise
Tax” means any excise tax imposed under Section 4999 of the Code or a
similar provision that may later be enacted.

     

    g)           A “409A
Change of Control” means a Change of Control of RAI that meets the
requirements of a change of control under section 409A of the Code and section
1.409A-3(i)(5) of the Treasury Regulations, and any additional guidance or
regulations promulgated under section 409A of the
Code.

     

    (h)           “Notice of
Termination” After a Change of Control, Kessler may terminate this
Agreement by sending a written notice to RAI that
shall (i) specify the date of termination (the “Date of
Termination”) which shall not be more than sixty (60) days from the date
such Notice of Termination is given, (ii) indicate the specific provisions of
this Agreement that will apply upon such termination and (iii) set forth in
reasonable detail the facts and circumstances for the application of the
provisions indicated.

     

    (i)           “Person”
shall have the meaning given in Section 3(a)(9) of the Exchange Act and shall
also include any syndicate or group deemed to be a “person” under Section
13(d)(3) of the Exchange Act.

     

    (j)           “RAI”
means Resource America, Inc., a Delaware corporation and any direct or indirect
subsidiary of RAI by which Kessler is employed.  References to
payments, benefits, privileges or other rights to be provided by RAI
or  such subsidiary by which Kessler is employed, as the case may be,
will correspond to the corporate entity obligated to make payments or provide
benefits, privileges or other rights pursuant to employee benefit plans affected
by the provisions hereof, and in the absence of any such existing plans or
provisions, such reference shall be deemed to be to RAI.  RAI shall
also mean any successor by merger or other business combination to more than
one-half of the assets or ownership of RAI.

    


    
      
        
        

      

      
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              11.           Miscellaneous.

    

     

    a)           Severability.  In
case any one or more of the provisions contained herein shall, for any reason,
be held to be invalid, illegal, or unenforceable in any respect such validity,
illegality or unenforceability shall not affect any other provisions of this
Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision(s) had never been contained herein, provided that such
invalid, illegal or unenforceable provision(s) shall first be curtailed, limited
or eliminated only to the extent necessary to remove such invalidity, illegality
or unenforceability with respect to the applicable law as it shall then be
applied.

     

    b)           Modification of
Agreement.  This Agreement shall not be modified by any oral
agreement, either expressed or implied, and all modifications thereof shall be
in writing and signed by the parties hereto.

     

    c)           Waiver.  The
waiver of any right under this Agreement by any of the parties hereto shall not
be construed as a waiver of the same right at a future time or as a waiver of
any other rights under this Agreement.

     

    d)           Governing
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware, without giving
affect to the principles of conflicts of laws.

     

    e)           Notices.  Any
notice to be given pursuant to this Agreement shall be sufficient if in writing
and mailed by certified or registered mail, postage-prepaid, to the addresses
listed below, or to such other address as either party may notify the other of
in accordance with this section.

     

    If to
RAI:

     

    Resource
America, Inc.

    1
Crescent Drive, Suite 203

    Navy
Yard

    Philadelphia,
PA  19112

     

    If to
Kessler:

     

    Steven J.
Kessler

    1
Crescent Drive, Suite 203

    Navy
Yard

    Philadelphia,
PA  19112

     

    (f)           Duplicate Originals
and Counterparts.  This Agreement may be executed in any number
of duplicate originals or counterparts or facsimile counterparts, each of such
duplicate original or counterpart or facsimile counterpart shall be deemed to be
an original and all taken together shall constitute but one and the same
instrument.

     

    
      
        
        

      

      
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            12.           Section
409A.

     

                    (a)           Payment
Delay.  Notwithstanding anything in this Agreement to the
contrary, if Kessler is a “specified employee” of a publicly traded corporation
under section 409A of the Code and if payment of any amount under this Agreement
is required to be delayed for a period of six (6) months after separation from
service pursuant to section 409A of the Code, payment of such amount shall be
delayed as required by section 409A of the Code, and the accumulated postponed
amount, with interest (if applicable), shall be paid in a lump sum payment
within ten (10) days after the end of the six-month period.  If
Kessler dies during the postponement period prior to the payment of postponed
amount, the amounts withheld on account of section 409A of the Code, with
interest (if applicable), shall be paid to the personal representative of
Kessler’s estate within sixty (60) days after the date of Kessler’s
death.  A “specified employee” shall mean an employee who, at any time
during the twelve (12) month period ending on the identification date, is a
“specified employee” under section 409A of the Code, as determined by the
Board.  The determination of “specified employees,” including the
number and identity of persons considered “specified employees” and the
identification date, shall be made by the Board in accordance with the
provisions of sections 416(i) and 409A of the Code and the regulations issued
thereunder.  If a Change of Control shall have occurred and amounts
are postponed on account of section 409A, interest on the postponed amounts
shall accrue during for the postponement period at the prime rate published in
the Wall
Street Journal on Kessler’s Date of
Termination.

     

                    (b)           Section 409A
Compliance.  This Agreement is intended to comply with the
requirements of section 409A of the Code, and shall in all respects be
administered in accordance with section 409A.  Notwithstanding
anything in the Agreement to the contrary, distributions may only be made under
the Agreement upon an event and in a manner permitted by section 409A of the
Code or an applicable exemption.  All payments to be made upon a
termination of employment under this Agreement may only be made upon a
“separation from service” under section 409A.  For purposes of section
409A of the Code, the right to a series of payments under this Agreement shall
be treated as a right to a series of separate payments.  In no event
may Kessler, directly or indirectly, designate the calendar year of a
payment.  All reimbursements and in-kind benefits provided under this
Agreement shall be made or provided in accordance with the requirements of
section 409A of the Code, including, where applicable, the requirement that (i)
any reimbursement shall be for expenses incurred during Kessler’s lifetime (or
during a shorter period of time specified in this Agreement), (ii) the amount of
expenses eligible for reimbursement, or in-kind benefits provided, during a
calendar year may not affect the expenses eligible for reimbursement, or in-kind
benefits to be provided, in any other calendar year, (iii) the reimbursement of
an eligible expense will be made on or before the last day of the calendar year
following the year in which the expense is incurred, and (iv) the right to
reimbursement or in-kind benefits is not subject to liquidation or exchange for
another benefit.

     

     

    
      
        
        

      

      
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    IN
WITNESS WHEREOF, the parties hereto have executed or caused to be executed this
Agreement on the date first above written.

     

     

     

    
      	 
      	
              RESOURCE
      AMERICA, INC.

            
	 
      	 
      
	 
      	
              By:             /s/
      Michael S.
      Yecies                                                  

            
	 
      	
              Michael S. Yecies

            
	 
      	
              SVP, CLO &
  Sec.

            


    

     

     

    
      	 
      	
                       
      /s/ Steven J. Kessler

            
	 
      	          STEVEN
      J. KESSLER
	 
      	 
      


    

     

     

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