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Exhibit 10.4

 

[FORM OF] STOCKHOLDER AGREEMENT

 

 

 

This Stockholder Agreement (this “Agreement”) is made as of [__], 20[_] by and between, ENDI Corp., a Delaware Corporation (the “Company”), and Cohanzick Management, LLC (the “Shareholder”). For purposes of this Agreement, capitalized terms used and not defined herein shall have the respective meanings ascribed to them in the Merger Agreement (as defined below).

 

 

 

RECITALS

 

 

 

WHEREAS, the Company together with Enterprise Diversified, Inc., CrossingBridge Advisors LLC, a Delaware limited liability company (“CBA”), Zelda Merger Sub 1, Inc., a Delaware corporation, Zelda Merger Sub 2, LLC, a Delaware limited liability company and the Shareholder have entered into an Agreement and Plan of Merger dated [•], 2021 (the “Merger Agreement”);

 

 

 

WHEREAS, the Shareholder received and will own, upon closing of the transactions contemplated by the Merger Agreement, 2,400,000 shares of Class A Common Stock, par value $0.0001 per share (“Class A Common Stock”), and 1,800,000 shares of Class B Common Stock, par value $0.0001 per share (“Class B Common Stock” and, together with the Class A Common Stock, the “Common Stock”); and

 

 

 

WHEREAS, in connection with the Merger, and as part of the consideration to Shareholder for the Merger, Shareholder received Class W-1 warrants (the “Class W-1 Warrants”) to purchase one million eight hundred thousand (1,800,000) shares of Class A Common Stock and Class W-2 Warrants (the “Class W-2 Warrants” and, together with the Class W-1 Warrants, the “Warrants”) to purchase two hundred fifty thousand (250,000) shares of Class A Common Stock.

 

 

 

NOW THEREFORE, in consideration of the foregoing and of the promises and covenants contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

 

 

AGREEMENT

 

 

 

1.    Election of Boards of Directors.

 

 

 

1.1    Definitions. As used herein, the following capitalized terms have the following meanings when used herein with initial capital letters:

 

 

 

(a)“    Affiliate” means, with respect to the Principal Stockholder, any person, entity or firm which, directly or indirectly, controls, is controlled by or is under common control with such Person, including, without limitation, any entity of which such Person is a partner or member, any partner, officer, director, member or employee of such Person, any trust or other estate in which the Principal Stockholder holds at least a 10% beneficial interest or as to which the Principal Stockholder serves as trustee, grantor, or in a similar fiduciary capacity, and any trust established for estate planning purposes of which any partner or member of the Principal Stockholder, individually or jointly with such Person’s spouse, has the exclusive right to control such trust; and “control” (including the terms “controlling,” “controlled by,” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities, by contract, or otherwise.

 

 

 

(b)“    Beneficial Ownership” by a Person of any securities means ownership of such securities in respect of which such Person is considered to be a “beneficial owner” under Rule 13d-3 under the Exchange Act as in effect on the date hereof.

 

 

 

(c)“    Board of Directors” means the Board of Directors of the Company.

 

 

 

(d)“    Certificate of Incorporation” shall mean the Amended and Restated Certificate of Incorporation of the Company, dated as of ___________, 2022.

 

 

 

(e)“    Class B Director” means any director elected to the Company’s Board of Directors pursuant to Section 6.01(b) of the Certificate of Incorporation. The initial Class B Directors are listed on Schedule 1.

 

 

 

(f)“    Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

 

 

 

(g)“    Majority Owner” means David Sherman, an individual.

 

 

 

(h)“    Person” shall mean any individual, firm, corporation or other legal entity, and includes any successor (by merger or otherwise) of such entity.

 

 

 

(i)“    Principal Stockholder” shall mean collectively the Majority Owner, the Shareholder, and any successors or assignees of the Majority Owner or the Shareholder.

 

 

 

1.2    Nomination and Election of Directors. From and after the date that the holders of Class B Common Stock are no longer entitled to elect at least one Class B Director to the Board of Directors pursuant to the Certificate of Incorporation, the following provisions apply:

 

 

 

 (a)    [From and after the date that the holders of Class B Common Stock are no longer entitled to elect at least one Class B Director to the New Parent Board pursuant to the terms of the Amended and Restated Certificate of Incorporation of New Parent, the following provisions apply: for so long as David Sherman, the CBA Member and any of their successors or assigns (collectively, the “Principal Stockholder”) and their Affiliates beneficially own at least five percent (5%) of the outstanding shares of New Parent Common Stock, the Principal Stockholder has the right to designate a number of directors of the New Parent board (rounded up to the nearest whole number) equal to the percentage of the New Parent Common Stock beneficially owned by the Principal Stockholder and its Affiliates at the time of such designation, provided however that for purposes of this designation right, the Principal Stockholder and its Affiliates’’ shall have the right to designate not more than a majority of the members of the Board of Directors then in office and, provided further, that so long as the Principal Stockholder and its Affiliates beneficially owns at least 5.0% of the total outstanding shares of Common Stock its shall have the right to designate at least one director. The Company, acting through the committee of the Board of Directors with authority to select or recommend director nominees for the Board’s selection (the “Nominating Committee”), and, as necessary, the Board of Directors, shall cause such individual or individuals (the “Principal Stockholder Directors”) to be nominated for election or appointment to the Board of Directors as set forth below; provided, that the Nominating Committee’s obligations under this Agreement are subject to the requirements of the committee members’ fiduciary duties as directors and Delaware General Corporation Law. At each meeting of the Company’s stockholders at which the directors of the Company are to be elected and, if the Board of Directors is classified at the time of such election, at which the class of directors of which the Principal Stockholder Director is a member, the Board of Directors agrees to recommend that the stockholders elect to the Board of Directors each Principal Stockholder Director nominated for election at such meeting in accordance with the provisions of Section 1.2(a), subject to the directors’ fiduciary duties as directors and the Delaware General Corporation Law.] 

 

 

 

(b)    At any time at which a vacancy shall be created on the Board of Directors as a result of the death, disability, retirement, resignation, removal or otherwise of a Principal Stockholder Director, the Principal Stockholder and its Affiliates shall then have, as a result thereof, the right to designate a replacement person for nomination for election to the Board of Directors, as specified in Section 1.2(a) and subject to the limitations thereof. The Principal Stockholder and its Affiliates, voting together as a single class, shall have the right to designate for appointment by the remaining directors under the Bylaws of the Company an individual to fill such vacancy and serve as a director. In connection with the foregoing, the Principal Stockholder agrees to provide information to the Nominating Committee as is necessary to determine that such individual will qualify to serve as a director of the Company under any applicable law, rule or regulation as well as under the terms of this Agreement.

 

 

 

(c)    To the extent there is an authorized committee of the Company’s Board of Directors, it shall include at least one (1) Principal Stockholder Director designated by the Majority Owner, to the extent qualified to serve on such committee.

 

 

 

(d)    For all Principal Stockholder Directors:

 

 

 

(i)     In the event that the Principal Stockholder and its Affiliates shall determine to remove from office a then Principal Stockholder Director, the Company shall take all actions necessary and appropriate to cause such removal to be effected promptly.

 

 

 

(ii)    In the event of removal, resignation, incapacity or death of a then Principal Stockholder Director, the Company shall take all actions necessary and appropriate to cause the successor Principal Stockholder Director to be elected or appointed as a director.

 

 

 

1.3    Obligations. The Shareholder and the Company agree not to take any actions that would contravene or materially and adversely affect the provisions of this Agreement and the intention of the parties with respect to the composition of the Company’s Board of Directors as herein stated, and will at all times in good faith assist in the carrying out of all of the provisions of this Agreement and in the taking of all such actions as may be necessary or appropriate in order to protect the rights of the Shareholder hereunder against impairment. The parties acknowledge that the fiduciary duties of each member of the Company’s Board of Directors are to the Company’s stockholders as a whole.

 

 

 

2.    Redemption.

 

 

 

2.1    Definitions. As used herein, the following capitalized terms have the following meanings when used herein with initial capital letters:

 

 

 

(a)“    Original Issue Price” shall mean $0.0001 per share, subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the shares of Class B Common Stock.

 

 

 

(b)“    Redemption Date” shall mean the effective date of a redemption pursuant to Section 2.

 

 

 

(c)“    Redemption Price” per share shall equal the Original Issue Price per share.

 

 

 

2.2    Redemption by the Company.

 

 

 

	 	
			2.2.1

				
			Redemption on the Fifth Anniversary. Unless prohibited by Delaware law governing distributions to stockholders, if, on or after the fifth (5th) anniversary of the Closing, any shares of Class B Common Stock shall remain outstanding, then the Company shall redeem all, but not less than all, of the outstanding shares of the Class B Common Stock at the Redemption Price (the “Anniversary Redemption”).

			

 

 

 

	 	
			2.2.2

				
			Mandatory Redemption Upon Exercise of Class W-1 Warrants. Upon the exercise of any Class W-1 Warrant by any Class W-1 Warrant holder, the Company shall redeem the number of shares of Class B Common Stock (on a pro rata basis from the holders of Class B Common Stock) that are equal to the number of shares of Class A Common Stock issued to the Class W-1 Warrant holder upon exercise of the Class W-1 Warrant (a “Mandatory Redemption”). Such Mandatory Redemption shall be at the Redemption Price. For the avoidance of doubt, the exercise of any Class W-2 Warrant shall not result in the reduction of Class B Common Shares pursuant to this Section 2.2.

			

 

 

 

	 	
			2.2.3

				
			Redemption Notice. The Company shall send written notice of any redemption pursuant to Subsection 2.2 (the “Redemption Notice”) to each holder of record of shares of the Class B Common Stock (i) thirty (30) days prior to the Redemption Date with respect to the Anniversary Redemption (provided that such notice shall not prevent a Class W-1 Warrant holder from continuing to exercise such Class W-1 Warrant through the fifth anniversary thereof) and (ii) three (3) business days after the Class W-1 Warrant has been exercised with respect to a Mandatory Redemption. Each Redemption Notice shall state:

			

 

 

 

	 	
			(a)

				
			the number of shares of the Class B Common Stock that the Company shall redeem on the Redemption Date specified in the Redemption Notice;

			

 

 

 

	 	
			(b)

				
			the Redemption Date and the Redemption Price; and

			

 

 

 

	 	
			(c)

				
			that the holder is to surrender to the Company, in the manner and at the place designated, his, her or its certificate or certificates representing the shares of the Class B Common Stock to be redeemed.

			

 

 

 

 

2.3    Surrender of Certificates; Payment. On or before the Redemption Date, each holder of shares of Class B Common Stock to be redeemed on such Redemption Date, shall surrender the certificate or certificates representing such shares (or, if such registered holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Company (including a bond if required by the Company’s transfer agent) to indemnify the Company against any claim that may be made against the Company on account of the alleged loss, theft or destruction of such certificate) to the Company, in the manner and at the place designated in the Redemption Notice and thereupon the Redemption Price for such shares shall be payable to the order of the Person whose name appears on such certificate or certificates as the owner thereof. Prior to the Redemption Date, the Principal Stockholder shall not transfer any shares of Class B Common Stock to any Person other than the owners of Shareholder and Shareholder’s Affiliates without the prior consent of the Board of Directors, not to be unreasonably withheld.

 

 

 

3.    Termination. The rights set forth in Section 1 shall terminate on the date that the Principal Stockholder and its Affiliates hold less than 5% of the outstanding shares of Common Stock.

 

 

 

4.    Amendments and Waivers. Except as otherwise provided herein, any provision of this Agreement may be amended or the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of (i) the Company and (ii) the Shareholder. No failure or delay of any party in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the parties hereunder are cumulative and are not exclusive of any rights or remedies which they would otherwise have hereunder.

 

 

 

5.    Severability. Whenever possible, each provision or portion of any provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but in the event that any provision of the Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

 

 

6.    Governing Law. This Agreement and the legal relations between the parties arising hereunder shall be governed by and interpreted in accordance with the laws of the State of Delaware without reference to its conflicts of laws provisions.

 

 

 

7.    Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile, portable document format (“.pdf”) or other electronic means of transmission shall be effective as delivery of an original counterpart of this Agreement.

 

 

 

8.    Successors and Assigns. Except as otherwise expressly provided in this Agreement, the provisions hereof shall inure to the benefit of, and be binding upon, the successors and assigns of the parties hereto. Nothing in this Agreement, express or implied, is intended to confer on any Person other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement.

 

 

 

9.    Entire Agreement. This Agreement constitutes the full and entire understanding and agreement among the parties, and supersedes any prior agreement or understanding among the parties, with regard to the subjects hereof and thereof, and no party shall be liable or bound to any other party in any manner by any warranties, representations or covenants except as specifically set forth herein or therein.

 

 

 

[Remainder of page intentionally left blank; signature page follows]

 

 

 

 

 

This Agreement is hereby executed effective as of the date first set forth above.

 

 

 

 

 

	
			COMPANY:

			ENDI CORP.

			By: _________________________

			Name:

			Title:

			
	
			SHAREHOLDER:

			COHANZICK MANAGEMENT, LLC

			By: _________________________

			Name:

			Title:

			

 

 

 

 

 

 

 

 

Schedule 1

 

 

 

Initial Class B Directors

 

 

 

See attached.HTML Editor

Exhibit 10.7

 

 AMENDED AND RESTATED EMPLOYMENT AGREEMENT 

 

 This Amended and Restated Employment Agreement (this “Agreement”) is made and entered into this 3rd day of June, 2022 to be effective as of immediately prior to the Closing (as defined in the Merger Agreement, as hereinafter defined) (the “Effective Date”), by and between CrossingBridge Advisors, LLC, a Delaware limited liability company (the “LLC”), and David K. Sherman (the “Employee”). 

 

W I T N E S S E T H:

 

 WHEREAS, on December 29, 2021, the LLC and Employee entered into that certain Employment Agreement (the “Original Employment Agreement”) prior to the execution of the Agreement and Plan of Merger (the “Merger Agreement”) dated as of December 29, 2021 by and among ENDI Corp. (“Parent”), the LLC, Zelda Merger Sub 1, Inc., Zelda Merger Sub 2, LLC, Enterprise Diversified, Inc. and Cohanzick Management, LLC (“Cohanzick”), which Original Employment Agreement set forth the terms by which the LLC will employ Employee from and after the Effective Date. 

 

 WHEREAS, Employee is an equityholder and the President of Cohanzick Management, LLC (“Cohanzick”), the LLC’s sole member. 

 

 WHEREAS, concurrently with the execution of the Original Employment Agreement, the LLC and Cohanzick entered into a Services Agreement pursuant to which the LLC will be providing certain ongoing operational services and support to Cohanzick and certain expenses will be allocated between them (the “Cohanzick Services Agreement”). 

 

 WHEREAS, in connection with certain other amendments to the Merger Agreement and ancillary agreements referenced therein,  the parties have determined to amend the severance provisions of the Original Employment Agreement in connection with a termination of employment by Employee for Good Reason or a termination by the LLC without Cause and in connection therewith have agreed to this amendment and restatement of the Original Employment Agreement. 

 

WHEREAS, in consideration of the mutual covenants contained herein, the parties hereto hereby agree as follows:

 

	 	
			1.0

				
			Employment

			

 

Employee is hereby employed by the LLC as of the Effective Date, according to the terms and conditions of this Agreement and Employee hereby accepts such employment.

 

	 	
			2.0

				
			Services by Employee 

			

 

 Employee will be employed as President of the LLC and as Chief Executive Officer of Parent.  Employee will perform duties and responsibilities which are consistent with such positions.  Employee is expected to observe and comply with all LLC policies and procedures, which may be modified by the LLC from time to time in the LLC’s sole discretion.  Employee will report to the Board of Directors of Parent (the “Board”).  Except as set forth below, Employee will render his business services exclusively to the LLC and Parent and will use his reasonable best efforts, judgment and energy to improve and advance the operations, programs, services and interests of the LLC and Parent in a manner consistent with the duties of his positions, including, without limitation and where applicable, in accordance with the terms of the Cohanzick Services Agreement.  Notwithstanding the foregoing, Parent and the LLC acknowledge and agree that (a) Employee continues to own a controlling interest in, and serve as President of, Cohanzick, which has or may have, presently or in the future, direct or indirect conflicts of interest with the LLC and/or Parent, and Employee shall have the discretion to allot as much time as he deems reasonable to the operation of Cohanzick and its related entities and, in connection therewith, Employee serves, and shall continue to serve, as a portfolio manager for clients that Cohanzick advises or sub-advises, including, without limitation, RiverPark Short Term HighYield Fund and RiverPark Strategic Income Fund; (b), Employee may (i) participate in educational, welfare, social, religious and civic organizations, and (ii) serve as an Adjunct Professor or in a similar temporary instructor role at New York University and/or similar higher education institutions.  All activities and services of Employee hereunder shall be rendered in a faithful, responsible and competent manner consistent with standards which may be established and maintained by the LLC. 

 

	 	
			3.0

				
			Compensation

			

 

	 	
			 3.1 

				
			 The LLC shall pay Employee a salary (the “Base Salary”) of $400,000 per calendar  year,  payable in accordance with the normal practices of the LLC. 

			

 

	 	
			3.2

				
			The LLC shall consider discretionary bonuses for Employee for each fiscal year of the LLC (each, a “Discretionary Bonus”).

			

 

	 	
			4.0

				
			Employee Benefits 

			

 

In addition to any other employee benefits which may be made available to Employee from time-to-time in the discretion of the LLC, the LLC shall provide the following to Employee:

 

	 	
			4.1

				
			The LLC shall provide Employee and his dependents with health insurance coverage, including dental and eye coverage.

			

 

	 	
			4.2

				
			The LLC shall provide a 401(k) plan if desired by Employee.

			

 

	 	
			4.3

				
			Employee shall be entitled to three (3) weeks of vacation in accordance with the standard vacation policy of the LLC during each year of the term of this Agreement.

			

 

	 	
			4.4

				
			The LLC will reimburse Employee, upon the submission by Employee of satisfactory documentation, for all reasonable and necessary travel and entertainment expenses incurred in connection with his performance hereunder.

			

 

	 	
			4.5

				
			The LLC shall indemnify and hold harmless Employee to the fullest extent permitted by law from and against any and all claims, suits, liabilities and expenses (including attorneys’ fees) arising out of or in connection with the service of Employee as an employee of the LLC, except for those caused by gross negligence or a breach of fiduciary duty of Employee.

			

 

	 	
			5.0

				
			Term 

			

 

Unless earlier terminated by the parties in accordance with Section 6.0 hereof, the term of this Agreement shall commence as of the date specified in Section 1.0 hereof and extend through the fifth (5th) anniversary thereof (the “Term”).

 

	 	
			6.0

				
			Termination of Employment

			

 

	 	
			6.1

				
			Termination by the LLC for Cause.  The LLC may terminate Employee’s employment and this Agreement for Cause, in which case Employee will be entitled to payment of any accrued but unpaid Base Salary due through termination, unreimbursed expenses incurred through the termination date in connection with Section 4.4 above, and all other vested and nonforfeitable compensation and benefits (in each case payable no later than ten (10) days after such termination).  “Cause” shall mean (a) Employee’s material or repeated (i) failure or refusal to perform his material duties, (ii) breach of a material policy of the LLC related to discrimination, harassment or retaliation, or (iii) breach of a material term of this Agreement, in each of (i)-(iii) which condition remains uncured within thirty (30) days following reasonable notice to Employee, if capable of cure, or (b) Employee’s fraud, embezzlement, material misappropriation of funds or property of the LLC or the Parent and/or conviction of a felony.

			

 

	 	
			 6.2 

				
			 Termination by Employee.  Employee may terminate his employment (a) for Good Reason, in which case he will be entitled to (i) payment of Base Salary, via normal payroll practice, for a period commencing on the date of termination and ending six (6) months thereafter (the “Payment Obligation Period”), provided that the Employee complies with Employee’s continuing obligations to the LLC and the Employee timely executes, returns to the LLC and does not revoke a general release of claims in favor of the LLC and its affiliated and related entities and their current and former officers, directors, employees and agents, in a form and substance reasonably satisfactory to the LLC, which release will be mutual (provided, however, that the release in favor of the Employee shall be subject to customary carve outs for claims arising out of Employee’s bad acts) and will include mutual non-disparagement provisions (subject to customary carve outs for required or protected disclosures) (the “Mutual Release of Claims”), (ii) accrued but unpaid Base Salary due through the date of termination, (iii) for the period commencing on the date of Employee’s termination of employment and ending at the end of the Payment Obligation Period or the date when COBRA continuation coverage has expired, whichever is earlier (such period, the “COBRA Coverage Period”), monthly reimbursement by the LLC of premiums for COBRA coverage of Employee (and, to the extent he has family coverage, his family), provided that Employee elects and is eligible for such coverage, and (iv) unreimbursed expenses incurred through the termination date in connection with Section 4.4 above, and all other vested and nonforfeitable compensation and benefits (in each case payable no later than ten (10) days after such termination); provided that the LLC’s obligations under (a)(i) and (iii) shall be contingent upon the Employee’s continued compliance with Employee’s continuing obligations to the LLC and Employee timely executing, returning to the LLC and not revoking the Mutual Release of Claims, or (b) for any reason other than Good Reason, in which case Employee shall provide the LLC with thirty (30) days’ advance notice of Employee’s intent to resign, and Employee will be entitled to payment of any accrued but unpaid Base Salary due through the date of termination, unreimbursed expenses incurred through the termination date in connection with Section 4.4 above, and all other vested and nonforfeitable compensation and benefits (in each case payable no later than ten (10) days after such termination).  “Good Reason” shall mean a reduction by the LLC of the Base Salary without Employee’s consent, which is not cured by the LLC within thirty (30) days after notice by the Employee.  Notwithstanding the foregoing, if Employee terminates his employment for Good Reason and the decision to reduce Employee’s Base Salary was made by a decision of the Board without the approval of Board members elected pursuant to the rights of the Principal Stockholder (as defined in the Stockholder Agreement) set forth in the Stockholder Agreement (as defined in the Merger Agreement) and/or the rights of the holders of the Class B Common Stock as set forth in the Amended and Restated Certificate of Incorporation of Parent, then in addition to the amounts due to Employee set forth above in this Section 6.2, Employee shall be entitled to a lump sum payment (payable no later than ten (10) days after such termination) equal to 2.5x his then annual Base Salary.   

			

 

	 	
			 6.3 

				
			 Termination by the LLC Without Cause.  The LLC may terminate Employee’s employment and this Agreement for any reason other than pursuant to Sections 6.1, 6.4 and 6.5 hereof, and, in such event, the LLC will pay to Employee (a) his Base Salary via normal payroll practice during the Payment Obligation Period, (b) accrued but unpaid Base Salary due through the date of termination, (c) unreimbursed expenses incurred through the termination date in connection with Section 4.4 above, and all other vested and nonforfeitable compensation and benefits (in each case payable no later than ten (10) days after such termination), and (d) during the COBRA Coverage Period, the LLC shall reimburse Employee each month for premiums for COBRA coverage for Employee (and, to the extent he has family coverage, his family), provided that Employee elects and is eligible for such coverage; provided that the LLC’s obligations under (a) and (d) shall be contingent upon the Employee’s continued compliance with Employee’s continuing obligations to the LLC and Employee timely executing, returning to the LLC and not revoking the Mutual Release of Claims.  Notwithstanding the foregoing, if the LLC terminates the employment of Employee without Cause and the decision to terminate Employee’s employment was made by a decision of the Board without the approval of Board members elected pursuant to the rights of the Principal Stockholder (as defined in the Stockholder Agreement) set forth in the Stockholder Agreement (as defined in the Merger Agreement) and/or the rights of the holders of the Class B Common Stock as set forth in the Amended and Restated Certificate of Incorporation of Parent, then in addition to the amounts due to Employee set forth above in this Section 6.3, Employee shall be entitled to a lump sum payment (payable no later than ten (10) days after such termination) equal to 2.5x his then annual Base Salary.   

			

 

	 	
			6.4

				
			Disability.  Notwithstanding any other provision of this Agreement, if during the Term Employee becomes physically or mentally disabled due to an illness, injury or condition such that he is unable to perform his essential duties for a period of more than ninety (90) consecutive days or for a cumulative period of more than ninety (90) days in any one (1) year period (a “Permanent Disability”), this Agreement will automatically terminate, and Employee will be entitled to payment of (a) his Base Salary via normal payroll practice during the Payment Obligation Period, provided Employee continues to comply with Employee’s continuing obligations to the LLC and Employee timely executes, returns to the LLC and does not revoke the Mutual Release of Claims, (b) accrued but unpaid Base Salary due through the date of termination, and (c) accrued but unreimbursed expenses incurred in connection with Section 4.4 above, and all other vested and nonforfeitable compensation and benefits (in each case payable no later than ten (10) days after such termination).  All rights and obligations hereunder shall be subject to state and federal laws governing disabilities and leaves of absence as well as the LLC’s applicable policies.  

			

 

	 	
			6.5

				
			Death.  If Employee dies during the Term of this Agreement, this Agreement will automatically terminate and his estate or legal representative will be paid any accrued but unpaid Base Salary due to Employee through his date of death and unreimbursed expenses incurred through the termination date in connection with Section 4.4 above and all other vested and nonforfeitable compensation and benefits (in each case payable no later than ten (10) days after such termination).  Payments pursuant to the immediately preceding sentence shall be made within thirty (30) days of his death.  

			
	 	 	 

 

	 	
			7.0

				
			Confidential Information 

			

 

Employee recognizes and acknowledges that there may be made available to him confidential information concerning the administrative, management, financial and marketing activities of the LLC and the Parent, and their respective affiliated and related entities, including, but not limited to, customer lists, procedures, processes, plans, strategies, cost and financial data and other trade secrets of a proprietary nature (collectively the “Confidential Information”). It is recognized that the Confidential Information, as it may exist from time to time, is a valuable, special, proprietary and unique asset of the LLC’s, the Parent’s and their respective affiliated and related entities’ business.  Employee shall not disclose, both during and after the term of his employment hereunder, any Confidential Information to any person or entity for any reason or purpose whatsoever or make any use thereof except (a) for use in the LLC’s interest and with its express authorization and (b) for use in connection with Employee’s services to Cohanzick under the Services Agreement (as applicable). In the event of a breach or threatened breach by Employee of the provisions of this Section 7.0, the LLC shall be entitled to obtain injunctive relief, without the necessity of posting a bond, restraining Employee from so disclosing any such Confidential Information, and to recover any and all costs and expenses (including attorneys’ fees) incurred in enforcing this Section 7.0, in addition to any other relief provided by applicable law.  Notwithstanding the foregoing, nothing in this Section 7.0 shall restrict Employee’s ability to perform, or cause the LLC to perform, his and its obligations arising under the Cohanzick Services Agreement.  Further, nothing in this Agreement shall prevent Employee from disclosing Confidential Information: (i) to the extent required by law, rule or regulation; (ii) in response to a subpoena or other valid legal process; (iii) to the extent necessary to enforce any provision of this Agreement, provided that Employee shall endeavor to file any such information under seal; (iv) as protected by law (including engaging in concerted activity under the National Labor Relations Act for mutual aid and protection); or (v) if such information becomes publicly available other than from disclosure by Employee or anyone acting in concert with Employee; provided that, under subsections (i) and (ii), where not prohibited by law, Employee agrees to provide the LLC with advance notice of disclosure.  Nothing in this Agreement, however, limits Employee’s ability to disclose Confidential Information or factual information to any federal, state, or local governmental agency, commission or body, including law enforcement agencies, the Equal Employment Opportunity Commission, the state or local human rights commission, the National Labor Relations Board, the Occupational Safety and Health Administration, and the Securities and Exchange Commission (the “SEC”) (each, a “Governmental Agency”), or self-regulatory organization or otherwise participate in any investigation or proceeding that may be conducted by any Governmental Agency or self-regulatory organization, without notice to the LLC, or to disclose Confidential Information or factual information to an attorney retained by Employee for the purposes of seeking legal advice regarding Employee’s employment or the termination thereof.  In all cases, Employee agrees to take all reasonable steps to protect the confidentiality of any information disclosed, including seeking confidential treatment by the relevant body, as applicable.  Further, nothing in this Agreement constitutes a waiver of the LLC’s or the Parent’s attorney-client, work product or other applicable privileges, and to the extent Employee is in possession of any information protected by such privileges, nothing herein authorizes Employee to disclose such privileged information to any third party.  Further, to the extent provided under applicable law, an individual shall not be held criminally or civilly liable for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney and solely for the purpose of reporting or investigating a suspected violation of law, or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  Further, an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal; and does not disclose the trade secret, except pursuant to court order.

 

 

8.0    Miscellaneous Provisions

 

8.1    This Agreement shall be binding upon the parties, their heirs, legal representatives, successors assigns.

8.2    The nature of Employee’s services are personal and Employee may not assign any of his rights and duties hereunder.

8.3    All notices required under this Agreement shall be made by certified mail, return receipt requested, addressed as follows, provided that either party may change its notice address by notifying the other party:

 

	
			If to Employee:

				
			Mr. David K. Sherman

			427 Bedford Road

			Pleasantville, NY 10570

			Email: david@crossingbridge.com

			
	
			If to the LLC:

				
			CrossingBridge Advisors, LLC

			427 Bedford Road

			Pleasantville, NY 10570

			Email: jbarkoe@crossingbridge.com

			

 

8.4    The headings of this Agreement have been inserted for convenience only and are to be ignored in any construction of the provisions hereof.

8.5    Any waiver of any provision of this Agreement must be in writing, signed by the party to be charged therewith, and a waiver on any occasion shall not be construed as a bar to or waiver of any such right or remedy on any future occasion unless the waiver specifically provides otherwise.

8.6    This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

8.7    This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and supersedes any prior agreements and understandings in connection therewith. This Agreement may be amended or modified only by a written instrument executed by both parties hereto.

 

 

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

 

 

	 	
			CrossingBridge Advisors, LLC

			By: /s/ David K. Sherman                                                      

			Title:  Managing Principal                                                     

			David K. Sherman

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