EX-10.2



 





EXHIBIT 10.2




ATTORNEY WORK PRODUCT

PRIVILEGED AND CONFIDENTIAL




EXECUTIVE EMPLOYMENT AGREEMENT




          THIS EMPLOYMENT AGREEMENT (the “Agreement”) dated as of [                    ], 2007 (the “Effective
Date”) is entered into by and among Pzena Investment Management, Inc. (the “Company”), Pzena
Investment Management, LLC. (the “Operating Company” and together with the Company, the “Employer”)
and [Richard A. Pzena][A. Rama Krishna][John P. Goetz][William L. Lipsey] (the “Executive”).



          WHEREAS, the Executive currently provides services to the Operating Company and owns units
therein (the “OC Units”);



          WHEREAS, the Employer desires to employ Executive in the positions set forth below and to
enter into an agreement embodying the terms of such employment;



          WHEREAS, the Executive desires to provide such services to the Employer and enter into such an
agreement; and



          WHEREAS, the Agreement is entered into in connection with: (1) the initial public offering and
sale of shares of Class A common stock of the Company (the “Class A Shares”) and simultaneous
listing of the Class A Shares on the New York Stock Exchange, (2) the Company’s acquisition of
interests in the Operating Company in exchange for certain OC Units and its appointment as the
managing member thereof (the “Managing Member”), (3) the amendment and restatement of the operating
agreement of the Operating Company, to be dated as of [      ], 2007 (the “Operating
Agreement”), pursuant to which the Executive’s OC Units will become exchangeable for Class A Common
Stock at the times and in the amounts described therein and to sell such Class A Shares at the
times and in the amounts and the manner described therein.



          NOW, THEREFORE, in consideration of the promises and mutual covenants set forth herein and for
other good and valuable consideration, the parties agree as follows:




	1.	 	Term of Employment. Subject to earlier termination as provided herein, Executive
shall be employed by the Employer for a period commencing on the Effective Date and ending on
the third anniversary of the Effective Date (the “Term”) on the terms and subject to the
conditions set forth in this Agreement; provided, however, that commencing with the third
anniversary of the Effective Date and on each anniversary thereof (each, an “Extension Date”),
the Term shall be automatically extended for an additional one-year period, unless the
Employer or Executive provides the other party hereto [60] days’ prior written notice before
the next Extension Date that the Term shall not be so extended. For purposes of this
Agreement, “Employment Term” shall mean the period of time that Executive is employed under
this Agreement.




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	2.	 	Positions.






	 	(a)	 	During the Employment Term, the Executive shall serve as (i)
[                    ] of the Operating Company and have the authority commensurate with
such position and such duties commensurate with such position, as shall be determined
from time to time by the Managing Member, and (ii) [                    ] of the Company
and have the authority commensurate with such position and such duties commensurate
with such position, as shall be determined from time to time by the Board of Directors
of the Company (the “Board”). If appointed thereto, the Executive further agrees to
serve, without additional compensation, as a director of the Company or a director (or
equivalent for non-corporate entities) or officer of the Operating Company or any other
consolidated subsidiary of the Company.
	 
	 	(b)	 	During the Employment Term, the Executive will devote Executive’s full business
time and best efforts to the performance of the duties of the positions in which he
serves pursuant to Section 2(a) hereof and will not engage in any other business,
profession or occupation for compensation or otherwise which would conflict or
materially interfere with the rendition of such services either directly or indirectly,
without the prior written consent of the Board and the Managing Member; provided that
nothing herein shall preclude Executive from (i) continuing to serve on any board of
directors or trustees of any business corporation or charitable organization on which
the Executive serves as of the Effective Date and which have been previously disclosed
to the Employer, (ii) serving on the boards of directors (or bodies with similar
management powers) of any entities managed by the Operating Company and/or consolidated
by the Company; or (iii) [subject to the prior written consent of the Board and the
Managing Member,] from accepting appointment to any board of directors or trustees of
any business corporation or charitable organization; provided in each case, and in the
aggregate, that such activities do not conflict or materially interfere with the
performance of the Executive’s duties hereunder or conflict with Section 5 of this
Agreement.






	3.	 	Guaranteed Payments and Employee Benefits.






	 	(a)	 	During the Employment Term, the Operating Company shall make a “guaranteed
payment” to the Executive at the annual rate of $300,000, payable in regular
installments in accordance with the Operating Company’s usual payment practices for
members. With respect to each fiscal year of the Operating Company which ends during
the Employment Term, the Operating Company shall also make an additional “guaranteed
payment” (the “Performance Payment”) to the Executive in an amount to be determined by
the Compensation Committee of the Board of the Managing Member in its sole discretion,
which Performance Payment shall not exceed $2,700,000 for any fiscal year of the
Company ending during the Employment Term. The Performance Payment, if any, shall be
paid to the Executive in a lump sum when payments are made to other members, but in no
event later than the 15th day of the third month following the end of the
fiscal




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	 	 	 	year in respect of which such guaranteed payment is earned, so long as Executive is
providing services to the Employer as of the last day of the fiscal year in respect
of which such guaranteed payment is earned.
	 
	 	(b)	 	During the Employment Term, the Executive shall be entitled to participate in
all employee benefit programs of the Employer on a basis which is no less favorable
than is provided to any other executives of the Employer.






	4.	 	Termination.






	 	(a)	 	General. This Agreement and the Executive’s employment hereunder may
be terminated by either party at any time and for any reason; provided that the
Executive shall be required to give the Employer at least 6 months’ advance written
notice of any resignation of the Executive’s employment hereunder. Following any such
termination, the Executive shall have no further rights to any payments or other
benefits provided pursuant to the provisions of this Agreement.
	 
	 	(b)	 	Expiration of Term.






	 	(i)	 	In the event the Term is not extended pursuant to Section 1 of
this Agreement, unless this Agreement and the Executive’s employment hereunder
has been earlier terminated pursuant to paragraph (a) of this Section 4, the
Executive’s employment hereunder shall be deemed terminated (whether or not the
Executive continues to provide services to the Employer thereafter) as the
close of business on the day immediately preceding the next scheduled Extension
Date. Following any such expiration of the Term, the Executive shall have no
further rights to any payments or other benefits provided pursuant to the
provisions of this Agreement.
	 
	 	(ii)	 	Unless the parties otherwise agree in writing, continuation of
the Executive’s employment by the Employer beyond the expiration of the Term
shall be deemed employment “at-will” and shall not be deemed to extend any of
the provisions of this Agreement, except for Sections 5 and 6 of this
Agreement, each of which shall survive the expiration of the Term and any
termination of this Agreement.






	 	(c)	 	Notice of Termination. Any purported termination by the Employer or by
the Executive (other than due to the Executive’s death) shall be communicated by
written notice of termination to the other party hereto in accordance with Section 6(h)
hereof.






	5.	 	Executive Covenants. The Executive acknowledges and recognizes the highly competitive
nature of the business of the Employer and its affiliates and accordingly agrees to be bound
by the restrictive covenants set forth in Sections 5.07 and 5.08 of the Operating Agreement,
to which the Executive is a party, and, in the event of his violation of such restrictive
covenants, the forfeiture of certain of his OC Units pursuant to Section 6.02 of the Operating
Agreement. A recitation of such restrictive covenants is set forth in




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	 	 	Exhibit A hereto. The Executive further acknowledges that he and the Employer have agreed
to enter into this Agreement in connection with the transactions described in the recitals
hereto, pursuant to which the Executive will have the opportunity to exchange OC Units for
Class A Shares and sell such Class A Shares.
	 
	6.	 	Miscellaneous.






	 	(a)	 	Survival of Certain Provisions. The provisions of Sections 5 and 6 of
this Agreement shall survive any expiration of the Term or any termination of the
Employment Term or this Agreement.
	 
	 	(b)	 	Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflicts of laws
principles thereof.
	 
	 	(c)	 	Entire Agreement; Amendments. This Agreement, along with the Operating
Agreement, contains the entire understanding of the parties with respect to the
services (or any termination thereof) to be provided by the Executive to the Company
and the Operating Company, and supersedes all prior agreements and understandings
(including verbal agreements) between the Executive and any of the Company, the
Operating Company or their respective affiliates regarding the terms and conditions of
the Executive’s services to the Company, the Operating Company and their respective
affiliates. There are no restrictions, agreements, promises, warranties, covenants or
undertakings between the parties with respect to the subject matter of this Agreement
other than those expressly set forth in this Agreement. This Agreement may not be
altered, modified, or amended except by written instrument signed by the parties
hereto.
	 
	 	(d)	 	No Waiver. The failure of a party to insist upon strict adherence to
any term of this Agreement on any occasion shall not be considered a waiver of such
party’s rights or deprive such party of the right thereafter to insist upon strict
adherence to that term or any other term of this Agreement.
	 
	 	(e)	 	Severability. In the event that any one or more of the provisions of
this Agreement shall be or become invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions of this Agreement
shall not be affected thereby.
	 
	 	(f)	 	Assignment. This Agreement, and all of the Executive’s rights and
duties hereunder, shall not be assignable or delegable by the Executive. Any purported
assignment or delegation by the Executive in violation of the foregoing shall be null
and void ab initio and of no force and effect. This Agreement may be assigned by the
Employer to a person or entity which is an affiliate or a successor in interest to
substantially all of the business operations of the Employer. Upon such assignment,
the rights and obligations of the Employer hereunder shall become the rights and
obligations of such affiliate or successor person or entity.




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	 	(g)	 	Successors; Binding Agreement. This Agreement shall inure to the
benefit of and be binding upon personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
	 
	 	(h)	 	Notice. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be deemed to
have been duly given when delivered by hand or overnight courier or three days after it
has been mailed by United States registered mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth below in this Agreement, 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.
	 
	 	 	 	If to the Employer:
	 
	 	 	 	120 West 45th Street

New York, New York 10036

Attention: [General Counsel]
	 
	 	 	 	If to the Executive:
	 
	 	 	 	To the most recent address of the Executive set forth in the personnel records of
the Employer.
	 
	 	(i)	 	Cooperation. The Executive shall provide the Executive’s reasonable
cooperation in connection with any action or proceeding (or any appeal from any action
or proceeding) which relates to events occurring during the Executive’s employment
hereunder.
	 
	 	(j)	 	Withholding Taxes. The Employer may withhold from any amounts payable
under this Agreement such Federal, state and local taxes as may be required to be
withheld pursuant to any applicable law or regulation.
	 
	 	(k)	 	Counterparts. This Agreement may be signed in counterparts, each of
which shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument.





[Remainder of Page Intentionally Left Blank]




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     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.



	 	 	 	 	 
	 	PZENA INVESTMENT MANAGEMENT, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PZENA INVESTMENT MANAGEMENT, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	
[Richard A. Pzena][A. Rama Krishna]

[John P. Goetz][William L. Lipsey]

 	 
	 	 	 
	 	 	 
	 	 	 



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