Document:

exv10w17

Exhibit 10.17

MODIFICATION AGREEMENT

                    ,                      COUNTY

     THIS MODIFICATION AGREEMENT (the “Modification Agreement”) is made and
entered into as of April 27, 2010 by and among FORTEGRA FINANCIAL
CORPORATION, a Georgia corporation (“Borrower”), LOTS INTERMEDIATE CO.,
a Delaware corporation (“Guarantor”) and COLUMBUS BANK AND TRUST COMPANY,
a Georgia banking corporation, whose address is 1148 Broadway, Columbus,
Georgia 31901 (hereinafter referred to as “Lender”).

WITNESSETH THAT:

     WHEREAS, Borrower, Guarantor and Lender entered into a Line of Credit Agreement dated April 6,
2009 (the “Loan Agreement”); and

     WHEREAS, as described in the Loan Agreement, Lender established a revolving line of
credit for Borrower in the stated principal amount of $15,000,000.00 (the “Credit
Line”) and Borrower agreed to repay advances made under said Credit Line, with interest
thereon, as provided in that certain Revolving Line of Credit Note given by Borrower to Lender
dated April 6, 2009 in the stated principal amount of Fifteen Million and No/l00ths ($15,000,000.00) Dollars (said Revolving Line of Credit Note is being referred to herein as the
“Line of Credit Note”); and

     WHEREAS, Guarantor executed and delivered to Lender an Unconditional Guaranty dated April 6,
2009 whereby Guarantor guaranteed to Lender, inter alia, the payment of the Line of Credit Note
(such Unconditional Guaranty being herein called the “Guaranty”); and

     WHEREAS, to secure the payment of the Line of Credit Note and all renewals, modifications,
extensions, amendments, restatements and amendments and restatements thereof, the Borrower executed
and delivered to Lender that certain Stock Pledge and Security Agreement from Borrower in favor of
Lender dated April 6, 2009 (the “Stock Pledge”) and that certain Pledge and Security
Agreement (Deposit Account) from Borrower in favor of Lender dated April 6, 2009 (the “Deposit
Account Pledge”; the Loan Agreement, the Line of Credit Note, the Guaranty, the Stock
Pledge, the Deposit Account Pledge and all other documents, instruments and agreements relating to
and/or securing the Credit Line being herein called the “Loan
Documents”; the Stock Pledge and
Deposit Account Pledge and any other documents and/or instruments and agreements entered into by
Borrower as security for the Line of Credit Note being herein called the “Security Documents”); and

     WHEREAS, Borrower and Guarantor have requested, among other things, that Lender extend the
maturity date of the Line of Credit Note from March 31, 2010 to
September 30, 2010 and that the
principal amount of the Credit Line be reduced from $15,000,000.00 to $6,000,000.00; and

     WHEREAS, Lender has agreed, subject to the terms, conditions and provisions of this
Modification Agreement, to such extension of the maturity date of the Line of Credit Note to
September 30, 2010 and the reduction of the principal amount of the Line of Credit.

 

 

     NOW, THEREFORE, for and in consideration of the foregoing benefits and other good and
valuable consideration flowing among the parties hereto, the receipt and sufficiency of which is
hereby acknowledged, Borrower, Guarantor and Lender do hereby agree that:

     1. Modification of the Line of Credit Note.

          (a) As of and after the date hereof, the face principal amount of the Line of Credit Note is
decreased from $15,000,000.00 to $6,000,000.00.

          (b) As
of and after the date hereof, the “Maturity Date” as defined in Section 1(f) of
the Line of Credit Note is changed from March 31, 2010 to
September 30, 2010.

          (c) Borrower shall continue to pay accrued interest on the outstanding principal amount of the
Line of Credit Note, as amended and modified hereby, on each Monthly Payment Date (as defined in
the Line of Credit Note) until the Maturity Date (as defined in the Line of Credit Note, as
amended, modified and extended by this Modification Agreement). On the Maturity Date (as defined in
the Line of Credit Note, as amended, modified and extended by this Modification Agreement), the
entire outstanding principal amount of the Line of Credit Note and all accrued but unpaid interest
and other charges shall be due and payable in full from Borrower.

     2. Modification
of Loan Agreement. (a) As of and after the date hereof,
the Loan Agreement is hereby amended and modified so that all references therein to the Line
of Credit Note shall refer to the Line of Credit Note as amended and modified by this Modification
Agreement and as same may be further amended, modified, extended, renewed and/or replaced from time
to time .

          (b) Additionally, as of and after the date hereof, the references to “$15,000,000.00”
found in the Loan Agreement are hereby changed to $6,000,000.00 and the references
to “March 31, 2010” found in the Loan Agreement are hereby changed to September 30,
2010.

     3. Modification of Stock Pledge. (a) As of and after the date hereof, the Stock Pledge
is hereby amended and modified so that all references therein to the Line of Credit Note shall
refer to (and the Stock Pledge shall secure, without limitation, the payment of) the Line of Credit
Note as amended and modified by this Modification Agreement and as same may be further amended,
modified, extended, renewed and/or replaced from time to time.

          (b) As of and after the date hereof, the Stock Pledge is further hereby amended and modified
to add the following as subpart (f) of Section 5 of the Stock Pledge:

	 	(f)	 	Pledgor shall deliver to Secured Party, immediately upon Pledgor’s receipt of same, any and all stock certificates representing stock in LOTS
which Pledgor shall hereinafter acquire; it being the intent of the parties
that any and all stock acquired by Pledgor in LOTS shall be included in the
Stock Collateral and subject to the security interest granted Secured Party
by this Agreement. The delivery of such after acquired stock to
Secured Party shall be accompanied by an irrevocable stock power executed
in blank in a form promulgated by Secured Party and shall be
deemed to be a reaffirmation by Pledgor of all of the terms and provisions
of this Agreement.

2

 

     4. Modification of the other Loan Documents. As of and after the date hereof, the
other Loan Documents are hereby amended and modified such that all references therein to the Line
of Credit Note shall as of and after the date hereof refer to (and in the case of the Security
Documents, shall, without limitation, secure the payment of) the Line of Credit Note as amended,
modified and extended hereby and as same may be further amended, modified, extended, renewed and/or
restated from time to time. Guarantor hereby confirms that the debts, liabilities and obligations
of Borrower to Lender guaranteed by Guarantor pursuant to the Guaranty include, without limitation,
all debts, liabilities and obligations of Borrower under the Line of Credit Note as amended and
modified by this Modification Agreement and as same may be further amended, modified, extended,
renewed and/or replaced from time to time. Guarantor acknowledges and confirms that Guarantor’s
obligations under the Guaranty remain in full force and effect and have not been limited, waived, discharged, impaired or released in any respect by virtue of this Modification Agreement.

     5. Ratification. Except as expressly set forth herein, all terms, covenants and
provisions of the Line of Credit Note, Guaranty, and all other Loan Documents, shall remain in full
force and effect, and Borrower and Guarantor each does hereby expressly ratify and confirm the Line
of Credit Note, Guaranty and other Loan Documents, as amended and modified hereby, and ratifies and
confirms the continuing priority of the Security Documents, as amended and modified hereby, and
all UCC financing statements filed in connection with any of such Security Documents. It is the
intent of the parties hereto that this Modification Agreement shall
not constitute a novation or an
accord and satisfaction of any of the indebtedness evidenced by the Line of Credit Note, and shall
not adversely affect or impair the priority of any of the Security Documents.

     6. Waiver of Claims. Each of Borrower and Guarantor does hereby waive any claim which
it now has by virtue of this Modification Agreement or any instrument or agreement set forth
hereunder, and further agrees not to raise any such claims in any civil proceeding or otherwise.
Each of Borrower and Guarantor hereby acknowledges and agrees that as of the date hereof it has no
set-offs, claims, counterclaims or defenses to the obligations evidenced by the Loan Documents, as
amended and modified hereby. Each of Borrower and Guarantor does further hereby for itself and for
its agents, employees, successors, legal representatives, and assigns, forever release, acquit and
discharge Lender and its officers, directors, stockholders, agents, servants, employees,
successors, legal representatives and assigns of and from any and all claims, demands, debts,
actions and causes of actions arising out of or in connection with the Loan Documents which they
(or either of them) now have against Lender and its officers, directors, stock holders, agents,
servants, employees, legal representatives, heirs and assigns.

     7. Successors and Assigns/Miscellaneous. This Modification Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective successors and
assigns. Whenever the context may require, any pronouns used herein shall include the
corresponding masculine, feminine or neuter forms, and the singular form of nouns and
pronouns shall include the plural and vice versa. Any references in any of the Loan Documents to
any of the documents, instruments and agreements amended hereby shall as of and after the date
hereof refer to such documents, instruments and agreements as amended and modified hereby and as
same may be further amended, modified, extended, renewed and/or restated from time to time.

     8. Legal Fees and Expenses. Borrower agrees to pay directly or reimburse Lender for
all reasonable legal fees and other expenses actually incurred by Lender in connection with this
Modification Agreement and/or the recording hereof, if, at Lender’s option, this Modification
Agreement is recorded. Borrower further agrees to pay Lender a renewal fee of $3,000.00 which fee
shall be deemed fully earned and non-refundable on the date hereof.

3

 

     IN WITNESS WHEREOF, the parties have caused this Modification Agreement to be
appropriately executed and delivered under seal, effective as of the day and year first above
written.

	 	 	 	 	 
	 	BORROWER:

FORTEGRA FINANCIAL CORPORATION, a Georgia corporation

 	 
	 	By:  	/s/ Michael Vrban
 	 
	 	 	Name:  	Michael Vrban 	 
	 	 	Title:  	EVP and CFO 	 
	 

(CORPORATE SEAL)

4

 

	 	 	 	 	 
	 	GUARANTOR:

LOTS INTERMEDIATE CO., a Delaware corporation

 	 
	 	By:  	/s/ Michael Vrban
 	 
	 	 	Name:  	Michael Vrban 	 
	 	 	Title:  	EVP and CFO 	 
	 

(CORPORATE SEAL)

5

 

	 	 	 	 	 
	 	LENDER:

COLUMBUS BANK AND TRUST COMPANY, a Georgia 

banking corporation

 	 
	 	By:  	/s/ [ILLEGIBLE]
 	 
	 	 	Its: S.V.P. 	 
	 	 	 	 
	 	 	(CORPORATE SEAL) 	 
	 

6exv10w1

Exhibit
10.1

September 15, 2010

Mr. Michael M. Larsen

1527 Willowbrook Lane

Villanova, Pennsylvania 19085

Dear Mr. Larsen;

This will serve to confirm our recent discussion regarding our offer to you to join Gardner Denver,
Inc. as Vice President and Chief Financial Officer reporting directly to me and located at Gardner
Denver’s new headquarters in the greater Philadelphia area. This offer is contingent on successful
completion of a background check and acceptable results from a pre-employment drug screen.
Specifically please note the following:

	 	1.	 	Salary. Your annual base salary will be $450,000.
	 
	 	2.	 	Executive Annual Bonus Incentive Program. You will be eligible to participate
in the Gardner Denver, Inc. Executive Annual Bonus Incentive Program, subject to the terms
and conditions of the program. Your target annual incentive is 60% of your base salary.
Your annual incentive payout may range from 0% to 200% (max of 120%) of your annual
incentive target. Your award for the 2010 plan year will be prorated based on your start
date. A minimum amount of $140,000 will be awarded to you during March 2011 based on the
2010 bonus estimate you will no longer receive as a result of your resignation from General
Electric.
	 
	 	 	 	The specific performance objectives and measures for your annual incentive will be defined
and reviewed each year and your annual incentive awards will be calculated, approved and
paid after financial results have been finalized and the awards have been approved by the
Board of Directors.
	 
	 	3.	 	Long Term Cash Bonus Plan (LTCB). In addition, the Compensation Committee
instituted a long-term cash bonus plan in 2001, which is based on a rolling three (3) year
earnings before tax (EBT) performance of the Company’s businesses. Your target long-term
bonus opportunity will be 55% of base salary (with a maximum payout of 110% of base
salary).
	 
	 	 	 	Your participation in the Long Term Cash Bonus Plan is based on your employment with Gardner
Denver. You will have one full year employment participation in 2011, which is
1/3rd participation in the 2009 — 2011 LTCB plan, which will result in a
1/3rd payout of the plan in March 2012. You will have two full years employment
participation in 2011 and 2012, which is 2/3rds participation in the 2010 — 2012
LTCB plan, which will result in a 2/3rds payout of the plan in March 2013. And
then you will have three full years employment participation in 2011, 2012 and 2013, which
is 3/3rds participation in the 2011 — 2013 LTCB plan, which will result in a
3/3rds or 100% payout of the plan in March 2014.

Note that your plan participation (1/3, 2/3, 3/3rds) does not guarantee a payout and that
achievement of the plan results drive the actual payouts which can result in no payout, below or
above target payouts.

													
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Gardner Denver, Inc.
	 	1800 Gardner Expressway
	 	Quincy, IL 62305
	 	217 222 5400
	 	fax 217 223 5897
	 	 

M Larsen Final Offer Letter 9-15-2010

 

 

Note that the specifics of both of the Gardner Denver bonus plans (Executive Annual Bonus Incentive
Program and the Long Term Cash Bonus Plan) are determined by the Management Development and
Compensation Committee of the Board of Directors (the “Compensation Committee”) on an annual basis.
The criteria for achieving the annual bonus will be determined by the Compensation Committee, in
its sole discretion, at its annual first quarter meeting (normally in February) and bonuses will be
awarded following that meeting within a two to three week period depending on the payroll
processing cycle.

	 	4.	 	Equity Incentive Plan. Annually, you will be eligible to receive a restricted
stock (or restricted stock unit) and stock option grant pursuant to the Company’s Long-Term
Incentive Plan. Historically, these grants are determined by the Compensation Committee at
it’s annual first quarter meeting (normally in February) and the Company’s stock options
are granted with a strike price equal to the market close on the date of the Compensation
Committee’s approval of the grant. Stock option grants vest over a three (3) year period
in three (3) equal increments and are exercisable for seven (7) years. The Company’s
restricted stock units vest at the end of three (3) years.
	 
	 	5.	 	Special Restricted Stock Unit Grant. In order to bridge your transition from
your current employer to Gardner Denver, you will receive a special one-time award of 2,400
restricted stock units that will be granted at the market close price on October 11, 2010
or your first day of employment, whichever is later.
	 
	 	6.	 	Special Stock Options Grant. In order to bridge your transition from your
current employer to Gardner Denver, you will receive a special one-time award of 7,100
stock options that will be granted at the strike price at the market close price on
October 11, 2010 or your first day of employment, whichever is later.
	 
	 	 	 	Note, the above restricted stock units and stock options grants will have the same vesting
and forfeiture requirements as other annual grants.
	 
	 	7.	 	Change in Control. As an executive of the Company, you will receive a Change
in Control Agreement. This Agreement addresses adverse changes that may occur with respect
to your terms and conditions of employment, including position, location, compensation and
benefits, following a change of control. If, during the 24-month period following a change
in control, the Company terminates your employment other than for cause, or you terminate
for a good reason (i.e., relating to material changes in position, location, compensation
and/or benefits), you will receive payments consistent with the prevailing Change in
Control Agreement. Generally, per the current agreement at the time of this offer, you
would be entitled to receive:

	 	•	 	Cash payment of severance of two (2) times the sum of your base salary and bonus
amount
	 
	 	•	 	To the extent not included in the executives accrued compensation, the Company
will pay a pro-rata bonus amount for the year of termination, based on the
executives bonus amount and

													
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Gardner Denver, Inc.
	 	1800 Gardner Expressway
	 	Quincy, IL 62305
	 	217 222 5400
	 	fax 217 223 5897
	 	 

M Larsen Final Offer Letter 9-15-2010

 

 

	 	•	 	The Company will pay for the continuation of medical, dental and life insurance
benefits for two (2) years.

	 	 	 	The Executive Change in Control Agreement will be provided to you for complete review.
	 
	 	 	 	You will also receive an Indemnification Agreement to protect you from potential claims made
against you in your capacity as an executive of the Company.
	 
	 	8.	 	Sign on Bonus. You will be eligible to receive a one-time sign on bonus in the
amount of $100,000 less applicable taxes and withholding. This payment will be made to you
with your regularly scheduled paycheck as soon as practicable after your start date.
Should you voluntarily terminate your employment or be involuntarily terminated for cause,
(violation of code of conduct), from the Company within eighteen (18) months of your date
of hire, you will be required to repay the sign-on bonus payment in full.
	 
	 	9.	 	Executive Agreements.
	 
	 	 	 	As part of this offer you will receive a severance plan agreement with the following
provisions;

	 	a.	 	lump sum severance payment equal to two times the sum of your annual
base salary and executive annual bonus at full target
	 
	 	b.	 	12 months of paid COBRA for Health and Welfare benefits at the coverage
level prior to your termination
	 
	 	c.	 	outplacement services for up to 12 months
	 
	 	d.	 	with the following general terms and conditions (agreement will have
full T&C’s);

	 	i.	 	the agreement stipulates that you will receive the
severance benefits only if you are involuntarily terminated for other than
for cause
	 
	 	ii.	 	subject to other standard terms and conditions for
the Company’s severance packages including but not limited to waiver and
release and non-disclosure agreements, and
	 
	 	iii.	 	the severance agreement will expire after your second
year of employment (day of your second anniversary of date of hire).

	 	10.	 	Retirement Plans. As an executive of Gardner Denver, you will be eligible to
participate in the Company’s Retirement Savings Plan and Supplemental Excess Defined
Contribution Plan.
	 
	 	 	 	The Company’s Retirement Savings Plan is a tax-qualified 401(k) retirement savings plan.
You will be eligible to contribute from 1% to 100% of compensation tax deferred to this plan
up to the IRS limit (2010 = $16,500 pre-tax limit plus $5,500 pre-tax catch-up if age 50 or
older). The Company matches the first 3% of employee contributions $1 for each $1 and the
second 3% of employee contributions $.50 for each $1. The Company match is contributed in
the form of our common stock, but you will have the right to diversify out of Company common
stock into other fund alternatives, subject to applicable securities law requirements. You
will also receive a non-elective Company contribution equal to 4% of compensation up to the
Social Security wage limit (2010 = $106,800) base plus 8% of compensation that exceeds the
Social Security wage base up to the IRS limit (2010 =

													
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Gardner Denver, Inc.
	 	1800 Gardner Expressway
	 	Quincy, IL 62305
	 	217 222 5400
	 	fax 217 223 5897
	 	 

M Larsen Final Offer Letter 9-15-2010

 

 

	 	 	 	$245,000). All employee and company matching contributions are fully vested immediately and
the non-elective company contribution becomes fully vested after three (3) years of
employment.
	 
	 	 	 	In addition to the Retirement Savings Plan, you will be eligible to participate in the
Supplemental Excess Defined Contribution Plan. The Supplemental Plan provides you the
opportunity to continue to be credited with contributions on a pre-tax basis beyond the IRS
limits that apply to the Gardner Denver Retirement Savings Plan. The Company matching
contributions in this Plan are made at the same rate as in the Retirement Savings plan
described above. You will also receive a non-elective Company contribution equal to 12% of
compensation that exceeds the IRS limit (2010 = $245,000). All employee and Company
matching contributions are fully vested immediately and the non-elective company
contribution becomes fully vested after three (3) years of employment.
	 
	 	11.	 	Long-Term Care Insurance Program. The Compensation Committee adopted a
Long-Term Care Insurance program for Executives in 2004. The Company will pay for your
premium payments under this Program for ten (10) years. It provides lifetime benefit
protection of $300 per day and increases each year after 2005 at the lesser of the CPI or
5%.
	 
	 	12.	 	Additional Executive Benefits. As an executive of Gardner Denver, you will
also be eligible for the following benefits: (a) annual tax planning and tax return
preparation services by an external financial planning services company, (currently Rubin
Brown); (b) estate planning services (every five (5) years); (c) executive retirement
planning in connection with your retirement from Gardner Denver; (d) required annual
executive physical examinations; (e) executive long-term disability insurance; and (f)
participation in the charitable donations matching gifts program that matches your
charitable donations up to $2,500 annually.
	 
	 	13.	 	Health and Medical Insurance Coverage. You will also be eligible for other
benefits coverage including medical, dental, and life insurance and disability. A brief
summary of these benefit programs will be provided to you. Gardner Denver Benefits plan
coverage year begins on April 1st and ends on March 31st.
	 
	 	14.	 	Vacation. You will be eligible for four (4) weeks of vacation per year.
	 
	 	15.	 	Start Date: Your start date will be October 11th 2010 or earlier.

													
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Gardner Denver, Inc.
	 	1800 Gardner Expressway
	 	Quincy, IL 62305
	 	217 222 5400
	 	fax 217 223 5897
	 	 

M Larsen Final Offer Letter 9-15-2010

 

 

Michael, I am very excited by the prospect of your acceptance of this offer to become a part of the
Gardner Denver team. Clearly, you can make a positive contribution to our goal of growing the
Company into a larger and more profitable organization. Please acknowledge your acceptance of this
offer by signing and dating this letter on the space provided below and faxing it back to Armando
L. Castorena, Vice President Human Resources at (217) 223-5897 or email a pdf of the signed offer
letter to armando.castorena@gardnerdenver.com

If you have any questions regarding any of the matters described in this letter, please do not
hesitate to contact me.

	 	 	 	 	 

	Sincerely,	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	/s/ Barry L. Pennypacker

Barry L. Pennypacker	 	 
	President & Chief Executive Officer	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	I have read and accept this offer of employment and agree to the terms and conditions.
	 
	 	 	 	 
	 
	 	 	 	 
	ACCEPTED AND AGREED:	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	/s/
Michael M. Larsen 	 	 
	Michael M. Larsen	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	Date:
	 	9/17/10	 	 
	 

	 	 	 	 

													
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Gardner Denver, Inc.
	 	1800 Gardner Expressway
	 	Quincy, IL 62305
	 	217 222 5400
	 	fax 217 223 5897
	 	 

M Larsen Final Offer Letter 9-15-2010

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