Document:

BOFISubscriptionAgreementSeriesC

SUBSCRIPTION AGREEMENT

Series C – 6% Non-Cumulative Convertible Perpetual Preferred Stock

BofI Holding, Inc.

Subscription Agreement Instructions 

BofI Holding, Inc., a Delaware corporation (the “Company”), is offering for sale up to 2,000 shares of its Series C – 6% Non-Cumulative Convertible Perpetual Preferred Stock (the “Shares”).  If, after thoroughly considering an investment in the Shares, including reviewing all information you deem material to your investment decision, you elect to subscribe for Shares, please follow the following procedures:

		
	1.
	Subscription Agreement:  Please carefully and completely read the Subscription Agreement and be certain that you understand and agree with all of its terms.  In particular, please pay special attention to Section B, containing the representations and warranties made by you, the investor, as well as to Section D, containing certain understandings, acknowledgements and agreements by you.

		
	2.
	Signature Page:  Please complete and execute the appropriate Signature Page attached to this Subscription Agreement.  Please verify that you have the correct Signature Page for the kind of person or entity that is subscribing for Shares.

	
		
	If the Subscriber is a(n):
	Use the Signature Page Entitled:

	 
	 

	Individual
	Individual Signature Page

	Living Trust or Inter Vivos Trust
	Individual Signature Page

	Individual Retirement Account (“IRA”)
	Individual Signature Page

	Other Retirement Plans
	Individual Signature Page

	Corporation
	Corporation Signature Page

	General or Limited Partnership
	Partnership Signature Page

	Limited Liability Company
	Partnership Signature Page

	Trust (other than living or inter vivos trusts)
	Trust Signature Page

If you have any questions about the selection of the appropriate Signature Page, please contact the Company.

Please complete, date and execute the Signature Page, as instructed, and return it to the Company with the Subscription Agreement.

3.    IRS Form W‐9:  Please complete, execute and return the attached IRS Form W‐9.

		
	4.
	Return of Executed Subscription Documents to the Company:  Please return to the Company the following subscription documents: (a) Subscription Agreement; (b) Signature Page and Questionnaire; (c) IRS Form W‐9; and (d) a check in the full amount of your subscription, payable to “BofI Holding, Inc.”  If you intend to wire 

subscription funds, please remit by wire transfer the amount of funds equal to the aggregate purchase price to the following account: 

Bank:                  BofI Federal Bank
		
	Bank Address:  
	12777 High Bluff Drive, Suite 100

San Diego, CA  92130
ABA Routing Number:    122287251
Account Number:        12002000805
Reference - Comments:    Series C Preferred Subscription Agreement

Upon receipt, the Company will review each subscription and determine its acceptability.  An incomplete or improperly completed subscription will delay consideration and “acceptance” of your subscription.  The Company will do its best to notify you of the disposition of your subscription as soon as reasonably practicable.  The Company reserves the right to reject any subscription, in whole or in part, in its sole and absolute discretion. 

5.    If you have any questions about these procedures, please direct all questions to:

Andy Micheletti at (858) 350-6211 or amicheletti@bofifederalbank.com 

SUBSCRIPTION AGREEMENT

BofI Holding, Inc.

Series C—6% Non-Cumulative Convertible Perpetual Preferred Stock
_________________________

BofI Holding, Inc.
12777 High Bluff Drive, Suite 100
San Diego, California 92130

This Subscription Agreement (this “Agreement”) is made by and between BofI Holding, Inc., a Delaware corporation (the “Company”), and the undersigned subscriber who is subscribing to purchase shares of Series C – 6% Non-Cumulative Convertible Perpetual Preferred Stock (the “Shares”).

In consideration of the Company’s agreement to sell Shares to the undersigned upon the terms and conditions set forth in this Subscription Agreement, the undersigned agrees and represents as follows:

		
	A.
	SUBSCRIPTION 

		
	1.
	The undersigned hereby irrevocably subscribes (the “Subscription”) for and agrees to purchase the number of Shares at the purchase price per Share, in the aggregate dollar amount indicated on the signature page hereto (the “Subscription Amount”).  The undersigned tenders with this Subscription Agreement the Subscription Amount in immediately available funds to the Company (the “Payment”).

		
	2.
	The undersigned understands that the Payment will be held for his, her or its benefit up to the time the Subscription is accepted or rejected.

		
	3.
	The undersigned agrees that the Company reserves the right to reject any Subscription, in whole or in part, in its sole discretion.  The undersigned further acknowledges and agrees that the Company will determine in its sole discretion, if and when the Subscription is accepted.  If your Subscription is accepted by the Company, the Company will deliver to you a countersigned copy of this Agreement. 

		
	B.
	REPRESENTATIONS AND WARRANTIES OF THE INVESTOR

The undersigned hereby represents and warrants to, and agrees with, the Company, as follows:

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	1.
	The Shares are being purchased for the undersigned’s own account, for investment purposes only, not for the account of any other person, and not with a view to distribution, assignment, or resale to others, or to fractionalization in whole or in part.  No other person has or will have a direct or indirect beneficial interest in the undersigned’s Shares.  Subject to Section D.8, the undersigned subscriber agrees not to sell, hypothecate, or otherwise transfer the undersigned’s Shares unless:  (a) the Shares are registered under the Securities Act of 1933 (the “Securities Act”) and all applicable state securities laws, or (b) in the opinion of counsel, concurred in by counsel to the Company, an exemption from the registration requirements of the Securities Act and such state laws is available.

		
	2.
	The undersigned has sufficient savings, investments, reserves or cash flow to withstand a complete loss of his or her or its investment in the Company and, to the extent the undersigned is an individual, the undersigned can provide for his or her living expenses for the foreseeable future assuming such a complete loss.

		
	3.
	In evaluating the suitability of an investment in the Company and in deciding to invest in Shares, the undersigned has neither received nor relied upon any oral or written representations from the Company or any other person, except as expressly set forth in this Agreement.  With respect to United States tax and other economic considerations involved in this investment, the undersigned is not relying on the Company or any other person with respect to evaluating the suitability of an investment in the Company.  The undersigned has carefully considered and, to the extent the undersigned believes such discussion necessary, has discussed with the undersigned’s professional legal, tax, accounting and financial advisors the suitability of an investment in the Company for the undersigned’s particular tax and financial situation, and the undersigned has determined that the Shares being subscribed for by the undersigned are a suitable investment for the undersigned.

		
	4.
	The undersigned recognizes that an investment in the Company involves substantial risks, including the possibility of the loss of the entire amount of such investment.  The undersigned is capable of identifying and evaluating all of the risks and other considerations related to the purchase of the Shares.

		
	5.
	If this Subscription Agreement is executed and delivered on behalf of a partnership, corporation, trust or estate or retirement plan:  (i) such partnership, corporation, trust or estate or retirement plan has been duly organized in accordance with applicable law and is duly qualified (a) to execute and deliver this Subscription Agreement and all other 

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instruments executed and delivered on behalf of such partnership, corporation, trust or estate or retirement plan or by use of a power of attorney in connection with the purchase of its Shares, and (b) to purchase and hold such Shares; (ii) the signature of the party signing on behalf of such partnership, corporation, trust or estate or retirement plan is binding upon such partnership, corporation, trust or estate or retirement plan; and (iii) such partnership, corporation, trust or estate or retirement plan has not been formed for the specific purpose of acquiring such Shares, unless each beneficial owner of such entity is an “accredited investor” within the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act (“Regulation D”) and has submitted information substantiating such qualification.

		
	6.
	The undersigned is an “accredited investor,” as defined in Regulation D, and understands that the information provided to the Company in the attached Questionnaire will be used by the Company to verify his, her or its status as an accredited investor. 

		
	7.
	The undersigned shall indemnify and hold harmless the Company and the officers, directors, employees, agents and representatives of the Company who is or are a party or is or are threatened to be made a party to any threatened, pending or completed action, suit or proceeding (whether civil, criminal, administrative or investigative) by reason of or arising from any actual or alleged misrepresentation or misstatement of facts or omission to represent or state facts made by the undersigned to the Company concerning the undersigned, or the undersigned’s financial position in connection with the offering or sale of the Shares, including, without limitation, any such misrepresentation, misstatement or omission contained in the Questionnaire submitted by the undersigned, against losses, liabilities, and expenses for which the Company or any officer, director, employee, agent, and representative of the Company has not otherwise been reimbursed (including attorneys’ fees, judgments, fines and amounts paid in settlement) actually and reasonably incurred by such person or entity in connection with such action, suit or proceeding.    

		
	C.
	REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to the undersigned as follows:

		
	1.
	The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.  The Company has all requisite corporate power to own and operate its properties and assets, and to carry on its business as presently conducted and as proposed to be conducted.

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	2.
	The Company has all requisite legal and corporate power to execute and deliver this Agreement and to sell and issue the Shares hereunder.

		
	3.
	As of the date hereof, the authorized capital stock of the Company consists of 25,000,000 shares of common stock, $0.01 par value per share, of which 12,813,171 shares are issued and outstanding as of September 30, 2012, and 1,000,000 shares of preferred stock, $0.01 par value per share, of which 515 shares of Series A Preferred Stock are issued and outstanding.  All issued and outstanding shares have been duly authorized and validly issued and are fully paid and nonassessable.  There are no pre-emptive rights with respect to the capital stock of the Company.  The Company has no outstanding rights, options, warrants, conversion rights or agreements for the purchase or acquisition from the Company of any shares of its capital stock or other securities of the Company, other than:  (a) shares issuable pursuant to the exercise of stock options outstanding under the Company’s 1999 Stock Option Plan and 2004 Stock Incentive Plan; and (b) outstanding shares of Series A Preferred Stock. 

		
	4.
	All corporate action on the part of the Company, its directors, and its stockholders necessary for the sale and issuance of the Shares and the performance of the Company’s obligations hereunder has been taken, or will be taken.  When and if accepted by the Company, this Subscription Agreement will be a valid and binding obligation of the Company, enforceable in accordance with its terms, subject to laws of general application relating to bankruptcy, insolvency and the relief of debtors.  The Shares, when paid for and issued pursuant hereto, will be validly issued, fully paid and nonassessable.

		
	D.
	UNDERSTANDINGS, ACKNOWLEDGEMENTS AND AGREEMENTS

The undersigned understands, acknowledges and agrees with the Company as follows:

		
	1.
	This Subscription may be rejected, in whole or in part, by the Company in its sole discretion.  If your Subscription is accepted by the Company, the consummation of the sale of Shares will occur upon delivery to you by the Company of a countersigned copy of this Agreement.  Until such time, any offer to purchase the Shares may be withdrawn or revoked, without obligation or commitment of any kind.

		
	2.
	This Subscription is irrevocable except with the written consent of the Company, and except that the undersigned shall have no obligation for 

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this Subscription in the event that this Subscription is rejected in full for any reason.

		
	3.
	The Shares are not savings accounts, deposits or other obligations of a bank or savings institution and are not insured by the Federal Deposit Insurance Corporation or any other government agency.  Furthermore, the Shares have not been recommended by any federal or state securities commission or other regulatory authority.  Furthermore, the foregoing authorities have not confirmed the accuracy, or determined the adequacy of this Agreement or any other document relating to the offering of Shares, and have not endorsed the merits of the Shares.  Any representation to the contrary is a criminal offense.

		
	4.
	There is no public or other market for the Shares and no such public or other market is expected to develop.  There can be no assurance that the undersigned will be able to sell or dispose of the undersigned’s Shares and the undersigned may have to bear the economic risk of this investment in the Shares indefinitely.  It is understood that in order not to jeopardize the offering’s exempt status under Section 4(2) of the Securities Act and Regulation D, the transferee may at a minimum be required to fulfill the investor suitability requirements prescribed under Regulation D.

		
	5.
	The stock certificates evidencing Shares will be endorsed with the following legend:

“THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, ASSIGNED, PLEDGED, OR OTHERWISE TRANSFERRED UNLESS REGISTERED OR QUALIFIED PURSUANT TO THE PROVISIONS OF THE ACT AND APPLICABLE STATE SECURITIES LAWS, OR UNLESS AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY IS OBTAINED STATING THAT SUCH OFFER, SALE, ASSIGNMENT, PLEDGE, OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION OR QUALIFICATION.”

		
	6.
	Rule 144.   Subscriber acknowledges and agrees that the Shares are “restricted securities” as defined in Rule 144 promulgated under the Securities Act as in effect from time to time and must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available.  The Company is under no obligation to register the Shares.  During such time as the Company is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company agrees to 

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timely file all required reports under the Exchange Act in order to enable you to utilize Rule 144 in connection with transfer or sale of the Shares (or shares of Common Stock issued upon conversion of the Shares).  In addition, upon request, the Company will furnish you with copies of its most recent annual or quarterly reports and such other information as you may reasonably request to avail yourself of any rule or regulation of the SEC which permits the sale of securities without registration.  At such time as any Shares (or shares of Common Stock issued upon conversion of the Shares) are eligible for sale or transfer under Rule 144(b)(1), the Company will remove any restrictive legend from the certificates evidencing such shares upon your request within a reasonable time.

		
	7.
	No Private Offering Memorandum.  The undersigned acknowledges and understands that the Company did not prepare or deliver a private offering memorandum for the offer and sale of the Shares, and agrees that such a memorandum was not necessary for the undersigned to evaluate a prospective investment in the Shares. The Company has provided the undersigned with all information that the undersigned has requested and that the undersigned considers material and relevant, as well as necessary or desirable, in connection with making a decision whether or not to invest in the Shares, including this Subscription Agreement, the Memorandum of Terms, the Certificate of Designations and the Company’s periodic filings with the Securities and Exchange Commission.  The undersigned has made the decision to invest in the Shares only after reviewing all such information, either individually or in consultation with the undersigned’s personal financial advisers.  By subscribing for Shares, the undersigned represents and warrants that the undersigned needs no other information in order to make an investment decision to purchase the Shares.

		
	8.
	Confidential Information.  If the undersigned has been informed by the Company that the undersigned has been provided with any material non-public information concerning the Company (“Confidential Information”), the undersigned agrees (a) that such Confidential Information is the property of the Company, (b) to use such Confidential Information solely in connection with an evaluation of the Company and an investment in the Shares, and (c) not to purchase or sell any securities of the Company (including entering into hedging or other derivative transactions based on the Company’s securities) until all such Confidential Information has been publicly disclosed by the Company.  Furthermore, the undersigned (i) is aware that the United States securities laws prohibit any person who has material nonpublic information about a company from purchasing or selling securities of such company, or from communicating such information to any other person under 

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circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell such securities, and (ii) represents and warrants to the Company that the undersigned has not used or caused any third party to use, and agrees not to use or cause any third party to use, any Confidential Information in contravention of the Exchange Act or any such rules and regulations, including without limitation Rule 10b-5 thereunder.  

E.    MISCELLANEOUS

		
	1.
	Neither this Subscription Agreement nor any provisions hereof shall be waived, modified, changed, discharged, terminated, revoked, or cancelled except by an instrument in writing signed by the party against whom any change, discharge, or termination is sought.

		
	2.
	Notices required or permitted to be given hereunder shall be in writing and shall be deemed to be sufficiently given when personally delivered or sent by registered mail, return receipt requested, addressed to the other party at the address given for such party in the accompanying Subscription Package.

		
	3.
	Failure of the Company to exercise any right or remedy under this Subscription Agreement or any other agreement between the Company and the undersigned, or otherwise, or delay by the Company in exercising such right or remedy, will not operate as a waiver thereof.  No waiver by the Company will be effective unless and until it is in writing and signed on behalf of the Company.

		
	4.
	This Subscription Agreement shall be enforced, governed, and construed in all respects in accordance with the laws of the State of Delaware, as such laws are applied by Delaware courts to agreements entered into and to be performed in Delaware by and between residents of Delaware, and shall be binding upon the undersigned, the undersigned’s heirs, estate, legal representatives, successors, and assigns, and shall inure to the benefit of the Company, its successors, and assigns.  If any provision of this Subscription Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law.  Any provision hereof which may prove invalid or unenforceable under any law shall 

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not affect the validity or enforceability of any other provision hereof.

F.     SIGNATURE AND QUESTIONNAIRE

The Signature Page and Questionnaire are contained as part of and are an integral part of this Subscription Agreement. 

8ex10-4.htm

BONDS.COM GROUP, INC. 8-K

 

Exhibit 10.4

 

EXECUTION VERSION

SEPARATION AGREEMENT

 

This is a SEPARATION AGREEMENT (this “Agreement”) dated as of August 1, 2012 (the “Effective Date”), between DAVID J. WEISBERGER (“Executive”) and BONDS.COM GROUP, INC., a Delaware corporation (the “Company”).

 

Executive was employed by the Company.  The Company and Executive have agreed to end their employment relationship on terms that are mutually agreeable.  Executive and the Company agree that Executive’s separation from the Company is effective as of his last day of work, July 31, 2012 (the “Separation Date”).  Executive will be paid his normal salary through the Separation Date, less all legally required deductions.

 

The Company will provide Executive with financial benefits and other consideration in return for Executive’s execution of this Agreement and the release Executive is providing under this Agreement.  Additionally, the Company and Executive intend to enter into a consulting relationship after the Separation Date, pursuant to the terms and subject to the conditions set forth in a Consulting Agreement dated as of even date herewith (the “Consulting Agreement”).

 

Accordingly, in consideration of the mutual promises set forth below, the Company and Executive agree as follows:

 

1.   Recitals.  The parties agree that the above Recitals are true and correct and are incorporated into this Agreement by reference.

 

2.   Severance Compensation and Benefits.

 

   2.1.   The Company shall pay to Executive severance at the rate of $175,000.00 per annum for the twelve months beginning August 1, 2012 through July 31, 2013 (the “Severance Period”), less ordinary payroll deductions (the “Severance Compensation”).  Additionally, the Company shall reimburse Executive’s COBRA premiums for continued health insurance coverage for Executive and his dependents through the end of the Severance Period (such reimbursement to be made promptly upon Executive’s submission of proof of payment by Executive) or until such earlier date as Executive is eligible for substantially similar health insurance benefits from a subsequent employer, but only if providing such benefit is permitted under applicable law and does not result in excise taxes, fines or penalties for the Company or the Company’s group health insurance plan (collectively with the Severance Compensation, the “Severance Payments”).  The parties acknowledge and agree that this is the severance employee is otherwise entitled to pursuant to Sections 4(b)(i) and (iv) of the Prior Employment Agreement (as defined below). The Severance Compensation will be paid on a periodic basis over the Severance Period in accordance with the Company’s normal payroll practices in effect as of the Separation Date.  Payment of the Severance Compensation will not commence until the first available payroll date after the Revocation Period referenced in Section 6 of this Agreement has expired, and payment of the Severance Payments are contingent upon Executive’s performing and complying his obligations under Sections 5 and 10.1 of this Agreement.  Specifically, if Executive breaches any of his obligations under Sections 5 or 10.1 below, then Executive will not be entitled to any Severance Payments and the Company shall not pay the Severance Payments; or, if such Severance Payment has already been paid, Executive shall be required to reimburse the Company in the full amounts paid.

 

3.   Return of All Company Property.  No later than seven (7) days after the Separation Date and except as the Company may expressly authorize in writing under the Consulting Agreement, Executive shall return in good condition to the Company all property of the Company that has yet to be returned that was or is in his possession or under his control.  In addition, Executive shall return to the Company on a computer disk any electronically stored confidential information that is the property of the Company, including but not limited to any data and files Executive has stored on his home or other computer or on a portable storage device; Executive shall also permanently and completely delete and remove such electronically stored information from wherever it is stored and provide written verification of doing so.

 

  

  

  

	
4.

	
Miscellaneous.

 

4.1.   Effective as of the first day immediately after the Separation Date, Executive agrees that he shall have no authority to and shall not enter or attempt to enter into any agreements with third-parties on behalf of or purportedly on behalf of the Company, except as may be permitted under the express written terms of the Consulting Agreement.  Executive shall also not represent himself as being employed by or associated with the Company, except as may otherwise be provided pursuant to the express written terms of the Consulting Agreement.  Executive further understands and agrees that he will receive no further compensation or benefits as a Company employee or otherwise due to him under his Prior Employment Agreement (as defined below).

 

4.2.   Executive shall refrain from making any disparaging statements, written or oral, in any forum or media, regarding the Company or its executives, managers, directors, officers, employees, shareholders, affiliates, policies, products, processes, operations, or facilities.

 

4.3.   From the Separation Date to the expiration of the Severance Period, Executive shall make himself available to the extent reasonably requested by the Company for the purpose of transitioning his duties, responsibilities, and any tasks or projects in which he was involved during his employment. Such services will be performed solely in a consultant, independent contractor capacity.  The Company will reimburse Consultant for reasonable and documented out-of-pocket expenses incurred in the performance of such services, but only to the extent pre-approved by the Company’s Chief Executive Officer and otherwise in accordance with the Company’s reimbursement policies in place from time to time. 

 

4.4.   Before and after the Separation Date, Executive shall cooperate with the Company, its Subsidiaries and their respective Affiliates in any internal investigation, any administrative, regulatory or judicial investigation or proceeding or any dispute with a third party as reasonably requested by the Company, any Subsidiary or any of their respective Affiliates (including, without limitation, Executive being available to the Company, its Subsidiaries and their respective Affiliates upon reasonable notice for interviews and factual investigations, appearing at the Company’s, any Subsidiary’s or any of their respective Affiliates’ request to give testimony without requiring service of a subpoena or other legal process, volunteering to the Company, its Subsidiaries and their respective Affiliates all pertinent information and turning over to the Company, its Subsidiaries and their respective Affiliates all relevant documents which are or may come into Executive’s possession, all at times and on schedules that are reasonably consistent with Executive’s other permitted activities and commitments).  In the event the Company, any of its Subsidiaries or their respective Affiliates require Executive’s cooperation in accordance with this Section following the Separation Date, the Company shall pay Executive a per diem reasonably determined by the Company’s Board of Directors and reimburse Executive for reasonable expenses incurred in connection therewith (including any lodging and meals, upon submission of receipts).

 

  

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4.5. Executive was awarded options to purchase shares of Common Stock on May 30, 2012, pursuant to a Notice of Stock Option Grant and a Stock Option Agreement, dated as of May 30, 2012, between the Company and Executive (the “2012 Option Agreement”). With respect to the 2012 Option Agreement, Executive and the Company have entered into an Amendment No. 1 to Notice of Stock Option Grant and Stock Option Agreement dated as of the Effective Date, a copy of which is attached hereto as Exhibit A.

 

	
5.

	
Release and Covenant Not to Sue.

 

5.1.   Executive’s Release of Company.  Executive, for himself and his heirs, successors, and assigns, and anyone claiming by or through them (collectively, the “Releasing Parties”), irrevocably and unconditionally releases, waives, and forever discharges Bonds.com Group, Inc., Bonds.com Holdings, Inc., Bonds.com, Inc., each of their respective parents, subsidiaries and affiliates, and each of their and their respective parents’, subsidiaries’, and affiliates’ respective directors, officers, agents, attorneys, present and former employees, partners, investors, shareholders, insurers, predecessors, successors, assigns, and representatives (each a “Released Party”), from any and all actual or potential claims, complaints, liabilities, obligations, promises, actions, causes of action, liabilities, agreements, damages, costs, debts, and expenses of any kind, whether known or unknown, that the Releasing Parties have ever had or now have from the beginning of time through the date Executive executes this agreement (each a “Released Claim,” and collectively, the “Released Claims”).  Without limitation, the Released Claims include all claims arising out of, related to or connected with Executive’s employment, the termination of his employment, or the payment of wages, salary, or any other benefit Executive received or claims he should have received in connection with his employment; all claims under Title VII of the Civil Rights Act of 1964, as amended; (42 U.S. C. § 2000e, et seq.); the Civil Rights Acts of 1866, 1871 and 1991, all as amended; 42 U.S.C. § 1981; the Family and Medical Leave Act of 1993, as amended (29 U.S.C. § 2601, et seq.); the Americans With Disabilities Act, as amended (42 U.S.C. § 12101, et seq.); the Rehabilitation Act of 1973, as amended (29 U.S.C. § 793-94); the Fair Labor Standards Act, as amended (29 U.S.C. § 201, et. seq.); the Equal Pay Act of 1963, as amended (29 U.S.C. § 206); the Employee Retirement Income Security Act, as amended (29 U.S.C. § 1001, et seq.); the Consolidated Omnibus Budget Reconciliation Act of 1985 (29 U.S.C. § 1161, et seq.); the Age Discrimination in Employment Act (29 U.S.C. § 621 et seq.); the Older Workers Benefit Protection Act of 1990 (29 U.S.C. § 623); the National Labor Relations Act (NLRA); the Occupational Safety and Health Act (OSHA); any federal or state whistle-blower statute or regulation; any law, rule or regulation of the State of New York, including but not limited to, the New York Human Rights Law; any other state law, rule or regulation of any other state; any local ordinance; workers' compensation statutes; any other federal, state or local statute, rule, regulation or ordinance; any obligations under, arising out of, or related to Executive’s Employment Agreement dated February 2, 2011 and any and all prior versions or amendments thereto; any obligations under, arising out of, or related to any other actual or quasi-contract, including but not limited to, salary payments, bonus payments, benefits; common law claims, including but not limited to claims of intentional or negligent infliction of emotional distress, negligent hiring, retention, training or supervision, defamation, invasion of privacy, breach of a covenant of good faith and fair dealing, breach of fiduciary duty, breach of express or implied contract, promissory estoppel, negligence or wrongful termination of employment; any claims for or to past or future unpaid salary, commissions, bonuses, incentive payments, expense reimbursements, health care benefits, life insurance, disability insurance and any other income or benefits the Releasing Parties received or claim they should receive; and all other claims of any kind, including but not limited to any claims for attorneys’ fees.

 

  

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5.2.   The Releasing Parties covenant not to sue any Released Party for any Released Claim.  The Releasing Parties warrant that they have not filed any complaint, claim or charge against a Released Party with any local, state or federal agency or court.  The Releasing Parties agree that, if any such agency or court assumes the prosecution or jurisdiction of any complaint or charge against a Released Party, the Releasing Parties will immediately dismiss the complaint or charge and/or will immediately request such agency or court to dismiss and withdraw from the matter, and the Releasing Parties will not support the effort of anyone else or any entity that might file an action against a Released Party.  In the event the Releasing Parties fail or refuse to undertake these obligations, the Releasing Parties agree that this Agreement shall operate to effectuate their dismissal or withdrawal of such complaint, charge or claim and that the Releasing Parties will forward to the Released Party any monies the Releasing Parties receive from such complaint, charge or claim.

 

5.3.   The Releasing Parties have not assigned or otherwise transferred any interest in any Released Claim.  The Releasing Parties shall not commence, join in, or in any manner seek relief through any suit arising out of, based upon, or relating to any Released Claim.

 

5.4.   If any provision of this release is held invalid, unenforceable or void to any extent by a court of competent jurisdiction, the provision shall be modified, if possible, by reducing its duration and scope to allow enforcement of the maximum permissible duration and scope.  The Company reserves the right to rescind this Agreement and recover all amounts paid under it if any provision of this release is held invalid, unenforceable or void in connection with a claim by Executive that any provision of this release is invalid, unenforceable or void.

 

	
6.

	
Review of this Agreement.

 

6.1.   Executive acknowledges that he has read each section of this Agreement, that the Agreement is written in a manner calculated to be understood by Executive, and that Executive in fact understands his rights and obligations under it, including the fact that he is waiving and releasing his rights to sue the Company.

 

6.2.   Executive is advised to consult with his legal counsel before executing this Agreement.

 

6.3.   Executive acknowledges that the money being paid pursuant to this Agreement and any other consideration is in excess of all monies or anything else of value owed to him.

 

6.4.   Executive has up to twenty-one (21) calendar days following the receipt of this Agreement to consider this Agreement before signing it.  However, Executive may consider and sign this Agreement in less time if he so chooses.

 

6.5.   Executive may revoke this Agreement within seven (7) days after his execution of this Agreement (the “Revocation Period”).  To revoke this Agreement, Executive shall deliver notice of such election in writing to the Company’s Chief Executive Officer, Thomas Thees, before 5:00 p.m. on the seventh day after execution.  If the seventh day does not fall on a business day, then the Revocation Period shall be deemed extended to 5:00 p.m. the next business day.

 

6.6.   This Agreement is not effective or enforceable until the Revocation Period has expired, and no monies or other consideration will be sent to Executive until after the Revocation Period has expired (assuming the Executive has not timely exercised his right to revoke the Agreement).

 

  

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7.   Consent to Jurisdiction.  EACH OF THE PARTIES IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE AND FEDERAL COURTS HAVING JURISDICTION OVER NEW YORK, NEW YORK AND THAT SUCH COURTS SHALL BE THE EXCLUSIVE JURISDICTION AND VENUE FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF THIS AGREEMENT, ANY RELATED AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.  EACH OF THE PARTIES HERETO FURTHER AGREES THAT SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY U.S. REGISTERED MAIL TO SUCH PARTY’S RESPECTIVE ADDRESS SET FORTH ABOVE SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY ACTION, SUIT OR PROCEEDING WITH RESPECT TO ANY MATTERS TO WHICH IT HAS SUBMITTED TO JURISDICTION IN THIS SECTION 7.  EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY OBJECTION TO THE LAYING OF SUCH COURTS’ JURISDICTION AND VENUE FOR ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF THIS AGREEMENT, ANY RELATED DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, AND HEREBY AND THEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION, SUIT OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

8.   Waiver of Jury Trial.  AS A SPECIFICALLY BARGAINED FOR INDUCEMENT FOR EACH OF THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT (AFTER HAVING THE OPPORTUNITY TO CONSULT WITH THEIR COUNSEL), EACH PARTY HERETO EXPRESSLY WAIVES, TO THE MAXIMUM EXTENT ALLOWED BY APPLICABLE LAW, THE RIGHT TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING RELATING TO OR ARISING IN ANY WAY FROM THIS AGREEMENT OR THE MATTERS CONTEMPLATED HEREBY.

 

9.   Choice of Law.  All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement and the exhibits and schedules hereto shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.

 

10.   Entire Agreement; Prior Agreements.

 

10.1.   The parties hereby terminate Executive’s Employment Agreement dated February 2, 2011 (the “Prior Employment Agreement”); provided, however, that Executive acknowledges, agrees, and understands that Sections 5 (Nondisclosure and Nonuse of Proprietary Information; Ownership of Intellectual Property), 6 (Non-Competition and Non-Solicitation) (except as amended in Section 10.2 below) and 11 through 23 of the Prior Employment Agreement remain applicable and enforceable, Executive shall be required to comply with the terms thereof, such Sections are incorporated into this Agreement by reference, and that nothing contained in this Agreement except as expressly set forth in Section 10.2 below shall be interpreted as modifying, replacing, terminating, or otherwise affecting the enforceability of such Sections.

 

10.2.   The parties agree that Section 6(a) of the Prior Employment Agreement is hereby amended by the addition of the following sentence at the end thereof:

 

“Nothing herein shall prohibit Employee from trading or investing in mortgage backed securities directly or as an employee or contractor of a broker-dealer, investment advisor, investment company or private fund, including where Employee is using an electronic trading platform solely as a user or trader and is not otherwise engaged in the Business.”

  

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10.3.   This Agreement and the Consulting Agreement (and in each case, any agreement or document expressly referenced therein) represents the entire agreement of the parties with respect to the subject matters addressed herein and may not be modified or amended except upon a written agreement signed by both parties.

 

11.   No Fraud.  The parties agree that no inducements, statements or representations have been made that are not set forth in this Agreement and that they did not rely on any inducements, statements or representations not set forth herein.

 

12.   Severability.  Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any action in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

13.   No Strict Construction.  The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party.

 

14.   Counterparts.  This Agreement may be executed in separate counterparts (including by means of facsimile and electronic transmission in portable document format (pdf)), each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

 

15.   Successors and Assigns.  This Agreement is intended to bind and inure to the benefit of and be enforceable by Executive, the Company and their respective heirs, successors and assigns, except that Executive may not assign his rights or delegate his duties or obligations hereunder without the prior written consent of the Company.

 

16.   Amendment and Waiver.  The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and Executive, and no course of conduct or course of dealing or failure or delay by any party hereto in enforcing or exercising any of the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement or be deemed to be an implied waiver of any provision of this Agreement.

 

17.   Titles and Headings.  The titles and headings of the various sections of this Agreement are intended solely for convenience of reference and are not intended to explain, modify or place any interpretation upon any of the provisions of this Agreement.

 

18.   Legal Fees and Costs.  In any litigation that arises from this Agreement, the prevailing party (or parties) may recover his or its legal fees and costs from the non-prevailing party (or parties).

19.   Notices.  Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, sent by reputable overnight courier service or mailed by first class mail, return receipt requested, to the recipient at the address below indicated:

  

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Notices to the Company:

 

Bonds.com Group, Inc.

1500 Broadway, 31st Floor

New York, NY 10036

Attention: Chief Executive Officer

 

	 	
Notices to Executive:

 

To Executive’s last known address on the Company’s personal records or to such other name or address as any designated recipient shall specify by notice to the other designated recipients in the manner specified in the Employment Agreement.

 

or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party.  Any notice under this Agreement shall be deemed to have been given when so delivered, sent or mailed.

 

20.   Section 409A Matters. Executive and the Company acknowledge and agree that Executive’s termination of employment constitutes an involuntary separation from service, within the meaning of Treasury Regulation Section 1.409A-1(n), as of the Separation Date.

 

21.   Definitions.  For purposes of this Agreement, the following terms shall have the meanings set forth below:

 

“Affiliate” means, with respect to the Company and its Subsidiaries, any other Person controlling, controlled by or under common control with the Company or any of its Subsidiaries and, in the case of a Person which is a partnership, any partner of the Person.

“Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

“Subsidiary” or “Subsidiaries” means any Person of which (i) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, or trustees thereof is at the time owned or controlled, directly or indirectly, by the Company or one or more of the other Subsidiaries of the Company or a combination thereof or (ii) if a limited liability company, partnership, association or other business entity (other than a corporation), a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by the Company or one or more Subsidiaries of the Company or a combination thereof and for this purpose a Person or Persons owns a majority ownership interest in such a business entity (other than a corporation) if such Person or Persons shall be allocated a majority of such business entity’s gains or losses or shall be or control any managing director or general partner of such business entity (other than a corporation).  For the purposes hereof, the term Subsidiary shall include all Subsidiaries of such Subsidiary.

PLEASE READ CAREFULLY.  THIS GENERAL RELEASE INCLUDES

A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.

  

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IN WITNESS WHEREOF, the Company and Executive have executed this Agreement as of the date first above written.

 

	Executed this 15th day of October 2012.	 	 	 	 
	
 

 

/s/ Betsy Caughman

	 	
 

 

/s/ David J. Weisberger

	WITNESS	 	DAVID J. WEISBERGER
	
  

	 	 	 
	Executed this 15th day of October 2012.	 	 	 
	 	 	BONDS.COM GROUP, INC.
	 	 	 	 
	 /s/ Betsy Caughman	 	By:	/s/ John Ryan
	WITNESS	 	Title:	Chief Financial Officer
	 	 	 	 

 

[SIGNATURE PAGE TO SEPARATION AGREEMENT]

 

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