Document:

exv10w26

 

Exhibit 10.26

April 13, 2007

Mr. Edward F. Kenney

Onyx Pharmaceuticals, Inc.

2100 Powell Street

Emeryville, CA 94608

Dear Ed:

This letter sets forth the substance of the retirement agreement (the “Agreement”) that Onyx
Pharmaceuticals, Inc. (the “Company”) is offering to you to facilitate your retirement from the
Company:

     1. Retirement Date. On December 31, 2007, you shall retire from your position as
Chief Commercial Officer and your employment with the Company will end (the “Retirement Date”).
Until the Retirement Date, you shall continue to use your best efforts to perform your assigned
duties and responsibilities, including, without limitation, the product launch of any Company
products. You will continue to receive your full current salary and benefits until the Retirement
Date, and you will continue to comply with all of the Company’s policies and procedures during this
time.

     2. Accrued Salary and Vacation. On the Retirement Date, the Company will pay you
all accrued salary, and all accrued and unused vacation earned through the Retirement Date, subject
to standard payroll deductions and withholdings. You are entitled to these payments whether or not
you sign this Agreement.

     3. Retirement Benefits. If you: (i) sign this Agreement and allow the Release
contained herein to become effective; and (ii) sign the Retirement Date Release attached hereto as
Exhibit A on or within 21 days after the Retirement Date and allow this Retirement Date Release to
become effective; then the Company will provide you with the following retirement benefits:

          (a) Retirement Payments. The Company will make retirement payments to you in the
form of continuation of your base salary in effect on the Retirement Date for twelve (12) months
following the Retirement Date (the “Retirement Payments”). The Retirement Payments will be made on
the Company’s ordinary payroll dates, and will be subject to standard payroll deductions and
withholdings.

          (b) Health Insurance. As provided by the federal COBRA law, state insurance laws,
and by the Company’s current group health insurance policies, you will be eligible to continue your
current health insurance benefits at your own expense for a period of time following the Retirement
Date and, later, to convert to an individual policy if you wish. You will be provided with a
separate notice of your COBRA rights. If you timely elect continued coverage under COBRA, as part
of this Agreement, the Company will pay the COBRA premiums necessary to continue your current
health insurance coverage for a period of twelve (12) months from the Retirement Date.

 

 

Edward F. Kenney

April 13, 2007

          (c) 2007 Bonus. You will be eligible to receive a bonus for 2007 pursuant to the
terms of the Company’s Bonus Plan. The Company shall have the sole discretion to determine whether
you receive any such bonus and, if so, the amount of any such bonus. If awarded, this bonus will
be paid at the same time as bonuses paid to other Company executives.

     4. Consulting Agreement. You will serve as a consultant to the Company under the
terms specified below. The consulting relationship commences on the Retirement Date and continues
for fifteen months from the Retirement Date (the “Consulting Period”).

          (a) Consulting Services. You agree to provide consulting services to the Company in
any area of your expertise upon request by the Chief Executive Officer (“CEO”) of the Company.
During the Consulting Period, you will report directly to the CEO, or as otherwise specified by the
CEO. You agree to exercise the highest degree of professionalism and utilize your expertise and
creative talents in performing these services. You agree to make yourself available to perform
such consulting services throughout the Consulting Period, up to a maximum of forty (40) hours per
month.

          (b) Consulting Fees and Benefits.

               (i) Consulting Fees. During the Consulting Period, you will receive as consulting
fees $400.00 per hour for each hour or portion thereof that you actually provide services to the
Company (“Consulting Fees”).

               (ii) Independent Contractor Relationship. During the Consulting Period, your
relationship with the Company will be that of an independent contractor, and nothing in this
Agreement is intended to, or should be construed to, create a partnership, agency, joint venture or
employment relationship. Except as set forth above in Section 3(b) of this Agreement, you will not
be entitled to any of the benefits which the Company may make available to its employees during the
Consulting Period, including, but not limited to, group health or life insurance, profit-sharing or
retirement benefits.

               (iii) Taxes and Withholding. You are solely responsible for, and will file, on a
timely basis, all tax returns and payments required to be filed with, or made to, any federal,
state or local tax authority with respect to the performance of consulting services and receipt of
fees under this Agreement. You are solely responsible for, and must maintain adequate records of,
expenses incurred in the course of performing services under this Agreement. The Company will not
withhold from the Consulting Fees any amount for taxes, social security or other payroll
deductions. The Company will regularly report amounts paid to you by filing Form 1099-MISC with
the Internal Revenue Service as required by law. You acknowledge that you will be entirely
responsible for payment of any such taxes, and you hereby indemnify and hold harmless the Company
from any liability for any taxes, penalties or interest that may be assessed by any taxing
authority with respect to all Consulting Fees you receive under this Agreement, with the exception
of the employer’s share of social security, if any.

               (iv) Stock Option. Your outstanding stock options (the “Options”) and stock bonus
awards will continue to vest through the Consulting Period, provided that you remain in compliance
with the terms of this Agreement. You will have ninety (90) days to exercise any vested Option
shares following the end of the Consulting Period. The Options that vest during the Consulting
Period will cease being incentive stock options under Section 422 of the Internal Revenue Code due
to the extension of your vesting period beyond your employment termination.

 

 

Edward F. Kenney

April 13, 2007

          (c) Limitations on Authority. You will have no responsibilities or authority as a
consultant to the Company other than as provided above. You agree not to represent or purport to
represent the Company in any manner whatsoever to any third party unless authorized by the Company,
in writing, to do so.

          (d) Proprietary Information and Inventions. You agree that the Employee Proprietary
Information and Inventions Agreement between you and the Company that you signed on May 10, 2004
(the “Proprietary Information and Inventions Agreement” a copy of which is attached hereto as
Exhibit B) shall govern any Company information to which you have access or which you develop, or
inventions made by you, while performing services during the Consulting Period.

          (e) Other Work Activities. Throughout the Consulting Period, you retain the right
to engage in employment, consulting, or other work relationships in addition to your work for the
Company. The Company will make reasonable arrangements to enable you to perform your work for the
Company at such times and in such a manner so that it will not interfere with other activities in
which you may engage. In order to protect the trade secrets and confidential and proprietary
information of the Company, you agree that, during the Consulting Period, you will notify the
Company, in writing, before you obtain competitive employment, perform competitive work for any
business entity, or engage in any other work activity that is competitive with the Company, and you
will obtain the Company’s written consent before engaging in any such competitive activity. If you
engage in such competitive activity without the Company’s express written consent, or otherwise
materially breach this Agreement, then, in addition to any other remedies, the Company’s obligation
to pay you Consulting Fees will cease immediately, and you will not receive option vesting after
the Retirement Date as provided in paragraph 4(b)(iv).

     5. Other Compensation or Benefits. You acknowledge that, except as expressly
provided in this Agreement, you will not receive from the Company any additional compensation,
including but not limited to salary or bonuses, severance or employee benefits after the Retirement
Date. You further acknowledge and agree that you are not currently entitled to receive any Change
in Control severance benefits nor shall you be entitled to receive any Change in Control severance
benefits in the future (including without limitation any accelerated vesting of your stock options
provided for in your stock option agreements or the Company’s stock option plan). Any such
provisions in your stock option agreements, stock bonus awards or the stock option plan providing
for accelerated vesting of stock options or stock bonus awards in the event of a change in control
are hereby superseded and shall have no further force or effect.

     6. Proprietary Information Obligations. You acknowledge your continuing obligations
under your Proprietary Information and Inventions Agreement both during and after the Consulting
Period. You agree not to use or disclose any confidential or proprietary information of the
Company without prior written authorization from a duly authorized representative of the Company.

     7. Nonsolicitation. You agree that for one year following the Retirement Date you
will not, either directly or through others, solicit or attempt to solicit any employee,
consultant, or independent contractor of the Company to terminate his or her relationship with the
Company in order to become an employee, consultant or independent contractor to or for any other
person or entity.

     8. Nondisparagement. You agree not to disparage the Company or the Company’s
officers, directors, employees, shareholders, parents, subsidiaries, affiliates, and agents, in any
manner

 

 

Edward F. Kenney

April 13, 2007

likely to be harmful to them or their business, business reputation or personal reputation;
provided that you may respond accurately and fully to any question, inquiry or request for
information when required by legal process.

     9. Dispute Resolution. Unless otherwise prohibited by law or specified below, all
disputes, claims and causes of action in law or equity arising from or relating to this Agreement
or its enforcement, performance, breach or interpretation shall be resolved solely and exclusively
by final and binding confidential arbitration through the Judicial Arbitration and Mediation
Service (“JAMS”) to be held in San Francisco, California under the then-existing JAMS arbitration
rules for employment matters. Nothing in this section, however, is intended to prevent either
party from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion
of any such arbitration.

     10. General Release. In exchange for the consideration provided to you by this
Agreement that you are not otherwise entitled to receive, you hereby generally and completely
release the Company and its current and former directors, officers, employees, shareholders,
partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations, both known and
unknown, that arise out of or are in any way related to events, acts, conduct, or omissions
occurring prior to your signing this Agreement. This general release includes, but is not limited
to: (a) all claims arising out of or in any way related to your employment with the Company or the
termination of that employment; (b) all claims related to your compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance
pay, fringe benefits, stock, stock options, or any other ownership interests in the Company; (c)
all claims for breach of contract, wrongful termination, and breach of the implied covenant of good
faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional
distress, and discharge in violation of public policy; and (e) all federal, state, and local
statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or
other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans
with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as
amended) (“ADEA”), and the California Fair Employment and Housing Act (as amended).
Notwithstanding the foregoing, nothing in this Agreement shall prevent you from filing, cooperating
with, or participating in any proceeding before the Equal Employment Opportunity Commission or the
California Department of Fair Employment and Housing, except that you acknowledge and agree that
you shall not recover any monetary benefits in connection with any such claim, charge or proceeding
with regard to any claim released herein.

     11. ADEA Waiver. You acknowledge that you are knowingly and voluntarily waiving and
releasing any rights you may have under the ADEA (“ADEA Waiver”). You also acknowledge that the
consideration given for the ADEA Waiver is in addition to anything of value to which you were
already entitled. You further acknowledge that you have been advised by this writing, as required
by the ADEA, that: (a) your ADEA Waiver does not apply to any rights or claims that arise after
the date you sign this Agreement; (b) you should consult with an attorney prior to signing this
Agreement; (c) you have twenty-one (21) days to consider this Agreement (although you may choose to
voluntarily sign it sooner); (d) you have seven (7) days following the date you sign this Agreement
to revoke the ADEA Waiver; and (e) the ADEA Waiver will not be effective until the date upon which
the revocation period has expired unexercised, which will be the eighth day after you sign this
Agreement (“Effective Date”). Nevertheless, your general release of claims, except for the ADEA
Waiver, is effective immediately, and not revocable.

 

 

Edward F. Kenney

April 13, 2007

     12. Waiver. In giving the release herein, which includes claims which may be
unknown to you at present, you acknowledge that you have read and understand Section 1542 of the
California Civil Code, which reads as follows:

A general release does not extend to claims which the creditor does not know or suspect to
exist in his favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor. (California Civil Code section 1542)

You hereby expressly waive and relinquish all rights and benefits under that section and any law or
legal principle of similar effect in any jurisdiction with respect to the release of unknown and
unsuspected claims granted in this Agreement.

     13. Entire Agreement. This Agreement, including all exhibits, constitutes the
complete, final and exclusive embodiment of the entire agreement between you and the Company with
regard to the subject matter hereof. It supersedes any and all other agreements entered into by
and between you and the Company. It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein. It may not be
modified except in writing signed by you and a duly authorized officer of the Company. Each party
has carefully read this Agreement, has been afforded the opportunity to be advised of its meaning
and consequences by his or its respective attorneys, and signed the same of his or its own free
will.

     14. Attorneys’ Fees. If either you or the Company brings any action to enforce
rights under this Agreement, the party successful in enforcing this Agreement shall be entitled to
recover reasonable attorneys’ fees and costs incurred by that party in connection with such action.

     15. Successors and Assigns. This Agreement will bind the heirs, personal
representatives, successors, assigns, executors and administrators of each party, and will inure to
the benefit of each party, its heirs, successors and assigns.

     16. Applicable Law. This Agreement will be deemed to have been entered into and
will be construed and enforced in accordance with the laws of the State of California as applied to
contracts made and to be performed entirely within California.

     17. Severability. If a court or an arbitrator of competent jurisdiction determines
that any term or provision of this Agreement is invalid or unenforceable, in whole or in part, then
the remaining terms and provisions hereof will be unimpaired. The court or the arbitrator will
then have the authority to
modify or replace the invalid or unenforceable term or provision with a valid and enforceable
term or provision that most accurately represents the parties’ intention with respect to the
invalid or unenforceable term or provision.

     18. Counterparts. This Agreement may be executed in two counterparts, each of which
will be deemed an original, all of which together constitutes one and the same instrument.
Facsimile signatures are as effective as original signatures.

     19. If this Agreement is acceptable to you, please sign below and return the
original to me.

 

 

Edward F. Kenney

April 13, 2007

I wish you the best of luck in your future endeavors.

Sincerely,

Onyx Pharmaceuticals, Inc.

	 	 	 	 	 
	By:
	 	/s/ Hollings C. Renton 	 	 
	 

	 	 

     Hollings C. Renton

     Chairman and Chief Executive Officer
	 	 

Exhibit A — Retirement Date Release

Exhibit B — Proprietary Information and Inventions Agreement

Understood and Agreed:

/s/ Edward F. Kenney                                                            

Edward F. Kenney

Date:
April 17, 2007

749590/paexv10w1

 

Exhibit 10.1

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

     AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) dated as of May 7, 2007 between
Luminent Mortgage Capital, Inc., a Maryland corporation having its principal place of business at
101 California Street, Suite 1350, San Francisco, California 94111 (the “Employer”) and Gail P.
Seneca, whose address is P.O. Box 1018, Inverness, California 94937 (the “Executive”).

WITNESSETH:

     WHEREAS, the Employer and the Executive wish to amend and restate the employment agreement
dated as of December 20, 2005 between the Employer and the Executive; and

     WHEREAS, the Employer and the Executive are entering into this Agreement to set forth and
confirm their respective rights and obligations with respect to the Executive’s continued
employment by the Employer;

     NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this
Agreement, the Employer and the Executive, intending to be legally bound hereby, mutually agree as
follows:

     1. Employment and Term.

          (a) Effective as of May 10, 2007 (the “Effective Date”), the Employer shall continue to employ
the Executive, and the Executive shall continue to be employed by the Employer, as the Chairman of
the Board (the “Position”) of the Employer, in accordance with the terms and subject to the
conditions set forth in this Agreement for a term (the “Term”) that shall commence on the Effective
Date and, as provided in and subject to paragraphs 1(b), 1(c), 1(d) and 1(e), shall continue until
December 31, 2008.

          (b) Unless otherwise provided in this Agreement or agreed by the Employer and the Executive,
all of the terms and conditions of this Agreement shall continue in full force and effect
throughout the Term and, with respect to those terms and conditions that apply after the Term,
after the Term.

          (c) Notwithstanding paragraph 1(b), the Employer, by action of its board of directors (the
“Board”) and effective as specified in a written notice thereof to the Executive in accordance with
the terms of this Agreement, shall have the right to terminate the Executive’s

 

 

employment under this Agreement at any time during the Term, for Cause (as defined in this
Agreement) or other than for Cause or on account of the Executive’s death or Permanent Disability
(as defined in this Agreement), subject to the provisions of this paragraph 1.

               (i) “Cause” shall mean (A) the Executive’s willful and continued failure substantially to
perform her material duties with the Employer as set forth in this Agreement, or the commission by
the Executive of any activities constituting a violation or breach under any material federal,
state or local law or regulation applicable to the activities of the Employer, in each case, after
written notice thereof from the Employer to the Executive and a reasonable opportunity for the
Executive to cease such failure, breach or violation in all material respects, (B) fraud, breach of
fiduciary duty, dishonesty, misappropriation or other actions that cause intentional material
damage to the property or business of the Employer by the Executive, (C) the Executive’s repeated
absences from work such that she is unable to perform her duties hereunder in all material respects
other than for physical or mental impairment or illness which the Executive fails to cure after
written notice or (D) the Executive’s admission or conviction of, or plea of nolo contendere to,
any felony or any other crime that, in the reasonable judgment of the Board, has a material adverse
effect on the Executive’s ability to carry out her obligations under this Agreement.
Notwithstanding the foregoing, the Employer may not terminate the Executive’s employment under this
Agreement for Cause unless the Executive is given (A) written notice, in accordance with the
by-laws of the Employer, of a special meeting of the Board to consider the termination of the
Executive’s employment under this Agreement for Cause and (B) the opportunity for the Executive to
address such special meeting.

               (ii) “Permanent Disability” shall mean a physical or mental disability such that the Executive
is substantially unable to perform the duties of the Position and the nonperformance of such duties
has continued for a period of 240 consecutive days, provided, however, that in order to terminate
the Executive’s employment under this Agreement on account of the Executive’s Permanent Disability,
the Employer must provide the Executive with written notice of the Board’s good faith determination
to terminate the Executive’s employment under this Agreement for reason of the Executive’s
Permanent Disability not less than 30 days prior to such termination, which notice shall specify
the date of termination. Until the specified effective date of termination by reason of the
Executive’s Permanent Disability, the Executive shall continue to receive compensation at the rates
set forth in paragraph 3. No termination of the Executive’s employment under this Agreement
because of the Executive’s Permanent Disability shall impair any rights of the Executive under any
disability insurance policy maintained by the Employer at the commencement of the aforesaid 240-day
period.

          (d) The Executive shall have the right to terminate her employment under this Agreement at any
time during the Term for Good Reason or without Good Reason, or in

-2-

 

the event a Change of Control occurs, all as specified in a written notice thereof to the
Employer in accordance with the terms of this Agreement. As used herein:

               (i) “Good Reason” shall mean (A) the Executive’s Position or the scope of the Executive’s
authority, duties or responsibilities as described in this Agreement are materially diminished
without the Executive’s written consent, excluding for this purpose any action that was not taken
by the Employer in bad faith and that is remedied by the Employer promptly following written notice
thereof from the Executive to the Employer; (B) a material breach by Employer of its obligations to
the Executive under this Agreement, which breach is not cured in all material respects to the
reasonable satisfaction of the Executive within 30 days (except in the case of a payment default
for which the cure period shall be 10 days), in each case following written notice thereof from the
Executive to the Employer or (C) any termination of the Executive’s employment under this Agreement
without Cause.

               (ii) As used herein, “Change of Control” shall mean (A) the acquisition of shares of the
Employer by any “person” or “group” (as such terms are used in Rule 13d-3 under the Securities
Exchange Act of 1934 as now or hereafter amended) in a transaction or series of transactions that
result in such person or group directly or indirectly becoming the beneficial owner of 25% or more
of the Employer’s Common Stock after the date of this Agreement, (B) the consummation of a merger
or other business combination after which the holders of voting capital stock of the Employer do
not collectively own 60% or more of the voting capital stock of the entity surviving such merger or
other business combination, (C) the sale, lease, exchange or other transfer in a transaction or
series of transactions of all or substantially all of the assets of the Employer, but excluding
therefrom the sale and reinvestment of the Employer’s investment portfolio or (D) as the result of
or in connection with any cash tender offer or exchange offer, merger or other business
combination, sale of assets or contested election of directors or any combination of the foregoing
transactions (a “Transaction”), the persons who constituted a majority of the members of the Board
on the date of this Agreement and persons whose election as members of the Board was approved by
such members then still in office or whose election was previously so approved after the date of
this Agreement, but before the event that constitutes a Change of Control, no longer constitute
such a majority of the members of the Board then in office. A Transaction constituting a Change in
Control shall only be deemed to have occurred upon the closing of the Transaction.

          (e) (i) If the Employer terminates the Executive’s employment under this Agreement for any
reason other than Cause and said termination occurs as of a date that is within 270 days preceding
or within 180 days after the consummation of a Change of Control (such 270-day period or such
180-period being referred to in this Agreement as a “Change of Control Period”), (B) this Agreement
is terminated as a result of the death or disability of the Executive effective as of a date within
a Change of Control Period, (C) the Executive

-3-

 

terminates her employment under this Agreement for Good Reason effective as of a date within a
Change of Control Period or (D) the Executive terminates her employment under this Agreement within
180 days after the consummation of a Change of Control, the Employer shall pay to the Executive or
her Estate promptly after the event giving rise to such payment occurs an amount equal to the sum
of (x)(1) the Executive’s Base Salary (as defined in this Agreement) accrued through the date the
termination of the Executive’s employment under this Agreement is effective and (2) any amount in
respect of excise taxes required to be paid to the Executive pursuant to paragraphs 1(f) or 1(g),
with such payments, rights and benefits described in clauses (x)(1) and (x)(2) being collectively
referred to in this Agreement as the “Accrued Obligations,” (y) an amount equal to the aggregate
premium that would be payable by the Executive to maintain in effect throughout the period (the
“Subsequent Period”) from the date of the termination of the Executive’s employment under this
Agreement through the remainder of the Term (assuming no increase in insurance premium rates) the
same medical, health, disability and life insurance provided by the Employer immediately prior to
the date of such termination (the “Benefit Obligations”) and (z) $1,000,000.

               (ii) If (A) the Employer terminates the Executive’s employment under this Agreement for any
reason other than for Cause effective as of a date that is not within a Change of Control Period or
(B) the Executive terminates her employment under this Agreement for Good Reason effective as of a
date that is not within a Change of Control Period, the Employer shall pay to the Executive
promptly after the event giving rise to such payment occurs an amount equal to the sum of (x) (1)
the Accrued Obligations, (y) the Benefit Obligations and (z) the Executive’s annual Base Salary as
of the effective date of termination of the Executive’s employment for the Subsequent Period.

               (iii) If (A) the Employer terminates the Executive’s employment under this Agreement for
Cause, (B) the Executive terminates her employment under this Agreement for any reason other than
Good Reason, her death or the Executive’s Permanent Disability or (C) this Agreement is terminated
by the Employer as a result of the death or Permanent Disability of the Executive, the sole
obligation of the Employer shall be to pay the Accrued Obligations to the Executive or her estate.

          (f) In the event that the independent public accountants of the Employer or the Internal
Revenue Service determines that any payment, coverage or benefit provided to the Executive pursuant
to this Agreement is subject to the excise tax imposed by Sections 280G and 4999 of the Internal
Revenue Code of 1986, as amended (the “Code”) or any successor provision thereof or any interest or
penalties incurred by the Executive with respect to such excise tax, the Employer, within 30 days
thereafter, shall pay to the Executive, in addition to any other payment, coverage or benefit due
and owing under this Agreement, an additional amount that will result in the Executive’s net after
tax position, after taking into account any interest, penalties or taxes imposed on the amount
payable under this paragraph

-4-

 

1(f), upon the receipt of the payments provided for by this Agreement be no less advantageous
to the Executive than the net after tax position to the Executive that would have been obtained had
Sections 280G and 4999 of the Code not been applicable to such payment, coverage or benefits.
Except as otherwise provided in this Agreement, all determinations to be made under this paragraph
1(f) shall be made by tax counsel whose selection shall be reasonably acceptable to the Executive
and the Employer and whose fees and costs shall be paid for by the Employer.

          (g) In the event that the independent public accountants of the Employer or the Internal
Revenue Service determines that any payment, coverage or benefit due or owing to the Executive
pursuant to this Agreement is subject to the excise tax imposed by Section 409A of the Code or any
successor provision thereof or any interest or penalties, including interest imposed under Section
409A(1)(B)(i)(I) of the Code, incurred by the Executive as a result of the application of such
provision, the Employer, within 30 days thereafter, shall pay to the Executive, in addition to any
other payment, coverage or benefit due and owing under this Agreement, an amount that will result
in the Executive’s net after tax position, after taking into account any interest, penalties or
taxes imposed on the amounts paid under this paragraph 1(g), being no less advantageous to the
Executive than the net after tax position to the Executive that would have been obtained had
Section 409A of the Code not been applicable to such payment, coverage or benefits. Except as
otherwise provided in this Agreement, all determinations to be made under this paragraph 1(g) shall
be made by tax counsel whose selection shall be reasonably acceptable to the Executive and the
Employer and whose fees and costs shall be paid for by the Employer.

          (h) Any notice of termination of the employment of the Executive under this Agreement by the
Employer to the Executive or by the Executive to the Employer shall be given in accordance with the
provisions of paragraph 9.

          (i) The Employer agrees to reimburse the Executive for the reasonable fees and expenses of the
Executive’s attorneys and for court and related costs in any proceeding to enforce the provisions
of this Agreement in which the Executive is successful on the merits.

     2. Duties of the Executive. Subject to the ultimate control and discretion of the
Board of the Employer, the Executive shall serve in the Position and perform all duties and
services commensurate with the Position. Throughout the Term, the Executive shall perform all
duties reasonably assigned or delegated to her under the by-laws of the Employer or from time to
time by the Board consistent with the Position. Except for travel normally incidental and
reasonably necessary to the business of the Employer and the duties of the Executive under this
Agreement, the duties of the Executive shall be performed in the greater San Francisco, California
metropolitan area. The Executive shall be free to engage in any other business activities during
the Term provided that such business activities do not materially impair her performance of the
duties of the Position.

-5-

 

     3. Compensation. For all services to be rendered by the Executive under this
Agreement:

          (a) Base Salary. The Employer shall pay the Executive a base salary (the “Base
Salary”) at an annual rate of $300,000, plus such other compensation as may, from time to time, be
determined by the Employer. At the end of each fiscal year of the Employer, the Employer shall
review the amount of the Executive’s Base Salary, and shall increase such Base Salary for the
following year to such amount as the Board may determine in its discretion. Such Base Salary and
other compensation shall be payable in accordance with the Employer’s normal payroll practices as
in effect from time to time.

          (b) Restricted Stock Award. Effective as of January 1, 2008, the Employer shall make
a restricted stock award to the Executive of 50,000 shares (the “Award”) of the Employer’s Common
Stock (the “Shares”). The Award shall be evidenced by a Restricted Stock Award Agreement between
the Employer and the Executive in substantially the form thereof currently in use by the Employer.
The Award and the Restricted Stock Award Agreement shall have the following other principal terms:

               (i) the Shares under the Award shall become vested, and remain vested from and after the
Effective Date, in three cumulative installments as follows:

                    (A) the first installment, consisting of one-half of the Shares, shall become vested from and
after December 31, 2008; and

                    (B) the second installment, consisting of an additional one-half of the Shares, shall become
vested from and after December 31, 2009.

               (ii) the Shares under the Award shall become vested pursuant to paragraphs 3(b)(i)(A) and (B)
regardless of whether this Agreement extends beyond the Term;

               (iii) the Shares, and any other shares of the Employer’s Common Stock held under prior or
subsequent restricted stock awards made to the Executive by the Employer, shall become immediately
vested in full and shall remain vested in the event of (A) a Change of Control (as defined herein),
(B) a termination of the employment of the Executive by the Employer under this Agreement without
Cause or (C) a termination of the employment of the Executive under this Agreement by the Executive
for Good Reason;

               (iv) any unvested Shares shall revert to the Employer immediately in the event of (A) a
termination of the employment of the Executive under this Agreement by the Employer for Cause or
(B) a termination of the employment of the Executive under this Agreement by the Executive without
Good Reason; and

-6-

 

               (v) The Executive shall have the right by notice to the Employer to require that the Employer
purchase from the Executive that number of vested shares of the Employer’s Common Stock at a price
per share equal to the average closing price of the Employer’s Common Stock on the New York Stock
Exchange for the 20 days preceding the Executive’s notice of purchase, as is necessary to provide
the Executive with sufficient funds to pay applicable federal and state income taxes resulting from
the vesting of Shares under the Awards, subject to the prior approval by the Compensation Committee
of the Employer’s Board of Directors of the price per share at the time of each such purchase.

          (c) The Executive shall be entitled to continue to receive all of the employee fringe benefits
currently received from the Employer as well as any other employee fringe benefits the Employer
makes available to its other executive officers, subject to the terms and conditions of the
applicable benefit plans.

          (d) The Employer shall provide the Executive with office space and administrative support at
its offices during the Term.

     4. Expenses. The Employer shall promptly reimburse the Executive for (a) all
reasonable expenses paid or incurred by the Executive in connection with the performance of the
Executive’s duties and responsibilities under this Agreement, upon presentation of expense vouchers
or other appropriate documentation therefor and (b) all reasonable professional expenses, such as
licenses and dues and professional educational expenses, paid or incurred by the Executive during
the Term.

     5. Indemnification. Notwithstanding anything in the Employer’s certificate of
incorporation or its by-laws to the contrary, the Executive shall at all times during her
employment by the Employer, and thereafter, be indemnified by the Employer to the fullest extent
permitted by applicable law for any matter in any way relating to the Executive’s affiliation with
the Employer and its subsidiaries.

     6. Confidential Information. The Executive understands that, in the course of her
employment by the Employer, the Executive will receive confidential information concerning the
business of the Employer and that the Employer desires to protect. The Executive agrees that she
will not at any time during or after the period of her employment by the Employer reveal to anyone
outside the Employer, except as required by law, or use for her own benefit, any such information
that has been designated as confidential by the Employer or understood by the Executive to be
confidential without specific written authorization by the Employer. Upon termination of this
Agreement, and upon the request of the Employer, the Executive shall promptly deliver to the
Employer any and all written materials, records and documents, including all copies thereof, made
by the Executive or coming into her possession during the Term and retained by the Executive
containing or concerning confidential information of the Employer and all other written materials
furnished to and retained by the

-7-

 

Executive by the Employer for her use during the Term, including all copies thereof, whether
of a confidential nature or otherwise.

     7. Entire Agreement; Amendment. This Agreement and any Restricted Stock Award
Agreements between the parties contain the entire agreement between the Employer and the Executive
with respect to the subject matter hereof, and may not be amended, waived, changed, modified or
discharged except by an instrument in writing executed by the Employer and the Executive.

     8. Assignability. The services of the Executive under this Agreement are personal in
nature, and neither this Agreement nor the rights or obligations of the Employer under this
Agreement may be assigned by the Employer, whether by operation of law or otherwise, without the
Executive’s prior written consent. This Agreement shall be binding upon, and inure to the benefit
of, the Employer and its permitted successors and assigns under this Agreement. This Agreement
shall not be assignable by the Executive, but shall inure to the benefit of the Executive’s heirs,
executors, administrators and legal representatives.

     9. Notice. Any notice that may be given under this Agreement shall be in writing and
be deemed given when hand delivered and acknowledged or, if mailed, one day after mailing by
registered or certified mail, return receipt requested, or if delivered by an overnight delivery
service, one day after the notice is delivered to such service, to either the Employer or the
Executive at their respective addresses stated above, or at such other address as the Executive or
the Employer may by similar notice designate.

     10. Specific Performance. The Employer and the Executive agree that irreparable
damage would occur in the event that any of the provisions of paragraph 6 were not performed in
accordance with their specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent breaches of paragraph 6 and to
enforce specifically the terms and provisions of paragraph 6, this being in addition to any other
remedy to which any party is entitled at law or in equity.

     11. No Third Party Beneficiaries. Nothing in this Agreement, express or implied, is
intended to confer upon any person or entity other than the parties (and the Executive’s heirs,
executors, administrators and legal representatives and the permitted transferees of the Shares)
any rights or remedies of any nature under or by reason of this Agreement.

     12. Successor Liability. The Employer shall require any successor, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or substantially all of the
business or assets of the Employer to assume expressly and agree to perform this Agreement in the
same manner and to the same extent that the Employer would be required to perform it if no such
succession had taken place.

-8-

 

     13. Mitigation. The Executive shall not be required to mitigate the amount of any
payment provided for in this Agreement by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this Agreement be reduced by any compensation
earned by the Executive as the result of employment by another employer or by retirement benefits
payable after the termination of this Agreement.

     14. Waiver of Breach. The failure at any time to enforce or exercise any right under
any of the provisions of this Agreement or to require at any time performance by the other parties
of any of the provisions hereof shall in no way be construed to be a waiver of such provisions or
to affect either the validity of this Agreement or any part hereof, or the right of any party
hereafter to enforce or exercise its rights under each and every provision in accordance with the
terms of this Agreement.

     15. No Attachment. Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge or hypothecation or to execution, attachment, levy or similar process or assignment
by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be
null, void and of no effect; provided, however, that nothing in this paragraph 15 shall preclude
the assumption of such rights by executors, administrators or other legal representatives of the
Executive or her estate and their assigning any rights under this Agreement to the person or
persons entitled hereto.

     16. Severability. The invalidity or unenforceability of any term, phrase, clause,
paragraph, restriction, covenant, agreement or other provision hereof shall in no way affect the
validity or enforceability of any other provision, or any part thereof, but this Agreement shall be
construed as if such invalid or unenforceable term, phrase, clause, paragraph, restriction,
covenant, agreement or other provision had never been contained in this Agreement unless the
deletion of such term, phrase, clause, paragraph, restriction, covenant, agreement or other
provision would result in such a material change as to cause the covenants and agreements contained
in this Agreement to be unreasonable or would materially and adversely frustrate the objectives of
the Employer and the Executive as expressed in this Agreement.

     17. Survival of Benefits. Any provision of this Agreement that provides a benefit to
the Executive and that by the express terms hereof does not terminate upon the expiration of the
Term shall survive the expiration of the Term and shall remain binding upon the Employer until such
time as such benefits are paid in full to the Executive or her estate.

     18. Construction. This Agreement shall be governed by and construed in accordance
with the internal laws of the State of California, without giving effect to principles of conflict
of laws. All headings in this Agreement have been inserted solely for convenience of reference
only, are not to be considered a part of this Agreement and shall not affect the interpretation of
any of the provisions of this Agreement.

-9-

 

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

	 	 	 	 	 
	 	LUMINENT MORTGAGE CAPITAL, INC.

 	 
	 	By:  	
 	 
	 	 	S. Trezevant Moore, 	 
	 	 	Jr., President and Chief Operating Officer 	 
	 

	 	 	 	 	 
	 	 	 
	 	
 	 
	 	Gail P. Seneca 	 
	 	 	 
	 

-10-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00123-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00123-of-00352.parquet"}]]