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Item 5. Other Information

2024-08-15 compared with 2024-05-24 · 163 added, 21 removed, 24 unchanged (88% of the section changed)

Other Information.

Gould Employment Agreement

On August 14, 2024, Binah Capital Group , Inc .

(the “ Company ”) entered into an executive employment agreement with Craig Gould, the Company’s Chief Executive Officer.

The Gould Agreement is for an initial, five-year term which will automatically renew for additional, consecutive three-year terms unless either party provides the other party with 90 days’ notice of the intent not to renew prior to the expiration of the applicable term.

Notwithstanding the foregoing, Mr.

Gould’s employment is “at-will”, and the Gould Agreement may be terminated at any time, by either party, with or without Cause (as defined below) or advance notice.

Gould’s 2024 annual base salary is $600,000.

In addition, the Company may provide Mr.

Gould a discretionary year-end performance-based bonus which will not be less than the bonus paid to any other executive of the Company.

Gould’s performance and the Company’s performance are to be primary considerations in determining any such annual bonus, which is subject to his continuous employment December 31 of the relevant bonus year, with such bonus payable no later than March 31 of the year following the relevant bonus year.

No later than September 15, 2024, the Company will grant Mr.

Gould nonqualified stock options to purchase 600,000 shares of common stock of the Company, subject to any reasonable capitalization adjustments before the date of grant, under the terms of the Company’s 2024 Equity Incentive Plan, as may be amended from time to time (the “ Plan ”).

These initial options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these initial options will be equal to the fair market value of the Company’s common Stock on the date of grant.

The vesting schedule of these initial options will be as follows:

(a) one-third of the Initial Options will vest on December 31, 2024, based on continued service through such date;

and (b) two-thirds of the Initial Options will vest ratably on a monthly basis over the remainder of Mr.

Gould’s initial term based on continued service through each vesting date, with the first such vesting date being on January 31, 2025.

The Initial Options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

On each anniversary of the Closing or May 15, 2024, the Company will grant Mr.

Gould nonqualified stock options to purchase that number of shares of common stock of the Company which have a grant date fair value equal to his then annual base salary amount, as reasonably determined by the Board, under the terms of the Plan.

These additional options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these additional options will be equal to the fair market value of the Company’s common Stock on the date of grant.

The vesting schedule of these additional options will be ratable monthly over three years from the date of the grant.

The additional options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

After the filing of a registration statement on Form S-8 for the Plan, the Company will grant Mr.

Gould, subject to his continuous service, 500,000 restricted stock units settled in shares of common stock of the Company, subject to any reasonable capitalization adjustments before the date of grant, with one-half of the grant vesting on the first anniversary of the date of grant and the remainder of the grant vesting on the second anniversary of the date of grant based on Mr.

Gould’s continued service through each vesting date.

During 2024, after the filing of a registration statement on Form S-8 for the Plan, the Company will grant to Mr.

Gould, subject to his continuous service, a fully vested share grant with a grant date fair market value of $220,000.

If, during 2025, Mr.

Gould continues to provide a personal guarantee on Company debt, the Company will grant Mr.

Gould, subject to his continuous service, a fully vested share grant with a grant date fair market value of $220,000.

All options granted by the Company will be forfeited upon Mr.

Gould’s termination for Cause.

All option grants will be subject to the terms of the applicable option agreement and Plan.

If the Company terminates Mr.

Gould’s employment without Cause, or Mr.

Gould resigns for Good Reason Mr.

Gould is entitled to (i) three times the amount of Mr.

Gould’s base compensation and three times the amount of the annual bonus payment paid to Mr.

Gould for the bonus year prior to the year in which termination occurs, payable in a lump-sum payment on the first regular payday occurring 60 days following the termination date, and (ii) accelerated vesting of all outstanding options as of the effective date of Mr.

Gould’s termination.

In addition, in the event that Mr.

Gould resigns other than for Good Reason, or the Gould Agreement is not renewed upon expiration of the applicable term, Mr.

Gould will receive a payment equal to his then-current annual base salary and target annual bonus, payable in a lump sum payment on the first regular payday occurring 60 days following the termination date, in exchange for Mr.

Gould being bound to a non-competition agreement.

Gould will only receive these severance payments if Mr.

Gould executes a full general and mutual release in a form acceptable to the Company and Mr.

Gould, and such release has become effective in accordance with its terms prior to the 60th day following the termination date.

All other obligations to Mr.

Gould will be automatically terminated and completely extinguished.

Gould’s employment with the Company terminates due to (x) Mr.

Gould’s death, (y) Mr.

Gould’s inability to perform the essential functions of his position with or without reasonable accommodation, (z) termination by the Company for Cause, Mr.

Gould will not be entitled to the severance payments in the prior paragraph and will only be entitled to receive base salary and benefits accrued through the termination date.

Gould’s employment terminates due to Mr.

Gould’s disability or death, Mr.

Gould will also be entitled to accelerated vesting of all stock or other options that are unvested as of the termination date.

For this purpose, “Cause” is defined as any of the following:

(i) conviction of or a plea of nolo contendere to any felony or any misdemeanor that involves crimes of moral turpitude, fraud or theft;

or (i) the material breach by Mr.

Gould of any of his obligations, duties and/or covenants under the Gould Agreement if such breach causes material damage to the Company, which breach, if curable, continues following written notice from the Company describing same with particularity and expiration of a 60-day cure period.

“Good Reason” is defined as any of the following, without Mr.

Gould’s written consent:

(i) a material diminution in Mr.

Gould’s responsibilities, authority or duties;

(ii) a diminution in Mr.

Gould’s base salary or target annual bonus amount;

or (iii) the material breach by the Company of any material provision of the Gould Agreement or other written agreement between the Company and Mr.

Gould, provided that a Good Reason Process has been followed prior to termination.

“Good Reason Process” shall mean that (i) Mr.

Gould reasonably determines in good faith that one of the Good Reason prongs has occurred;

Gould has notified the Company of such occurrence in writing within 30 days of the occurrence;

Gould cooperates in good faith with the Company’s efforts, for a period not less than 30 days following such notice (the “ Cure Period ”), to remedy the condition;

(iv) notwithstanding such efforts, the occurrence of the Good Reason continues to exist;

Gould terminates his employment within 30 days after the end of the Cure Period.

Gould’s employment is terminated for any reason, he is subject to:

ongoing confidentiality and non-disclosure obligations;

and 12-month, post-termination restrictive covenants of non-solicitation of employees, and customers Mr.

Gould will be subject to a 12-month, post-termination non-competition clause, provided that if his initial or renewal term is not extended or where he resigns without Good Reason, he must be compensated for the restricted period in order for the non-competition clause to be enforceable.

Each of the non-solicitation and non-competition provisions, as applicable, will be extended by one day for each day that Mr.

Gould is deemed by a court or other tribunal to have violated any such restrictive covenants.

Shane Employment Agreement

On August 14, 2024, the Company entered into an executive employment agreement with David Shane, the Company’s Chief Financial Officer (the “ Shane Agreement ”).

The Shane Agreement will be for an initial, three-year term which will automatically renew for additional, consecutive one-year terms unless either party provides the other party with 60 days’ notice of the intent not to renew prior to the expiration of the applicable term.

Notwithstanding the foregoing, Mr.

Shane’s employment is “at-will” and the Shane Agreement may be terminated at any time, by either party, with or without Cause (as defined below) or advance notice.

Shane’s 2024 annual base salary is $400,000.

In addition, the Company may provide Mr.

Shane a discretionary year-end performance-based bonus with a 2024 bonus target of 100% of his annual base salary.

For calendar year 2024, Mr.

Shane is guaranteed a bonus of no less than $350,000, and Mr.

Shane may be eligible for a bonus of up to 200% of his annual base salary, based on Mr.

Shane’s exceptional performance during such year.

Shane’s performance and the Company’s performance are to be primary considerations in determining any such annual bonus, which is subject to his continuous employment through December 31 of the relevant bonus year, with such bonus payable no later than March 31 of the year following the relevant bonus year.

No later than September 15, 2024, the Company will grant Mr.

Shane nonqualified stock options to purchase 250,000 shares of common stock of the Company, subject to any reasonable capitalization adjustments before the date of grant (the “ Initial Options ”), under the terms of the Plan.

These initial options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these initial options will be equal to the fair market value of the Company’s common stock on the date of grant.

The vesting schedule of these initial options will be as follows:

(a) one-third of the Initial Options will vest on December 31, 2024, based on continued service through such date;

and (b) two-thirds of the Initial Options will vest ratably on a monthly basis over the remainder of Mr.

Shane’s initial term based on continued service through each vesting date, with the first such vesting date being on January 31, 2025.

The Initial Options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

On the May 15, 2024, May 15, 2025, and May 15, 2026, the Company will grant Mr.

Shane nonqualified stock options to purchase that number of shares of common stock of the Company which have a grant date fair value equal to $350,000, as reasonably determined by the Board, under the terms of the Plan.

These additional options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these additional options will be equal to the fair market value of the Company’s common stock on the date of grant.

The vesting schedule of these additional options will be ratable monthly over three years from the date of the grant.

The additional options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

All options granted by the Company will be forfeited upon Mr.

Shane’s termination for Cause.

All option grants will be subject to the terms of the applicable option agreement and Plan.

If the Company terminates Mr.

Shane’s employment without Cause or Mr.

Shane resigns for Good Reason, Mr.

Shane is entitled to (i) Mr.

Shane’s then current base salary and target annual bonus amounts that would be payable during the greater of (A) the remainder of the applicable term but for such termination, or (B) the Restricted Period (as defined in Section 13.2 of the Shane Agreement), payable in a lump-sum payment on the first regular payday occurring 60 days following the termination date, and (ii) accelerated vesting of all outstanding options as of the effective date of Mr.

Shane’s termination.

In addition, in the event that Mr.

Shane resigns other than for Good Reason, or the Shane Agreement is not renewed upon expiration of the applicable term, Mr.

Shane will receive a payment equal to his then-current annual base salary and target annual bonus, payable in a lump sum payment on the first regular payday occurring 60 days following the termination date, in exchange for Mr.

Shane being bound to a non-competition agreement.

Shane will only receive these severance payments if Mr.

Shane executes a full general and mutual release in a form acceptable to the Company and Mr.

Shane, and such release has become effective in accordance with its terms prior to the 60th day following the termination date.

All other obligations to Mr.

Shane will be automatically terminated and completely extinguished.

Shane’s employment with the Company terminates due to (x) Mr.

Shane’s death, (y) Mr.

Shane’s inability to perform the essential functions of his position with or without reasonable accommodation, or (z) termination by the Company for Cause, Mr.

Shane will not be entitled to the severance payments in the prior paragraph and will only be entitled to receive base salary and benefits accrued through the termination date.

For this purpose, “Cause” is defined as any of the following:

(i) conviction of or a plea of nolo contendere to any felony or any misdemeanor that involves crimes of moral turpitude, fraud or theft;

or (i) the material breach by Mr.

Shane of any of his obligations, duties and/or covenants under the Shane Agreement if such breach causes material damage to the Company, which breach, if curable, continues following written notice from the Company describing same with particularity and expiration of a 30-day cure period.

“Good Reason” is defined as any of the following, without Mr.

Shane’s written consent:

(i) a material diminution in Mr.

Shane’s responsibilities, authority or duties;

(ii) a diminution in Mr.

Shane’s base salary or target annual bonus amount;

or (iii) the material breach by the Company of any material provision of the Shane Agreement or other written agreement between the Company and Mr.

Shane, provided that a Good Reason Process has been followed prior to termination.

“Good Reason Process” shall mean that (i) Mr.

Shane reasonably determines in good faith that one of the Good Reason prongs has occurred;

Shane has notified the Company of such occurrence in writing within 30 days of the occurrence;

Shane cooperates in good faith with the Company’s efforts, for a period not less than 30 days following such notice (the “ Cure Period ”), to remedy the condition;

(iv) notwithstanding such efforts, the occurrence of the Good Reason continues to exist;

Shane terminates his employment within 30 days after the end of the Cure Period.

Shane’s employment is terminated for any reason, he is subject to:

ongoing confidentiality and non-disclosure obligations;

and 12-month, post-termination restrictive covenants of non-solicitation of employees and customers.

Shane will be subject to a 12-month, post-termination non-competition clause, provided that if his initial or renewal term is not extended or where he resigns without Good Reason, he must be compensated for the restricted period in order for the non-competition clause to be enforceable.

Each of the non-solicitation and non-competition provisions, as applicable, will be extended by one day for each day that Mr.

Shane is deemed by a court or other tribunal to have violated any such restrictive covenants.

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.

Exhibit Number

Description of Document

Subscription Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc., Wentworth Management Funding LLC and Pollen Street Capital Limited (incorporated by reference to Exhibit 10.1 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Registration Rights Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc.

and the holders party thereto (incorporated by reference to Exhibit 10.2 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Lock-Up Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc.

and the holders party thereto (incorporated by reference to Exhibit 10.3 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Voting Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc.

and the holders party thereto (incorporated by reference to Exhibit 10.4 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Fifth Amendment to the Master Credit Agreement, dated March 15, 2024, by and among Wentworth and certain other borrowers party thereto (incorporated by reference to Exhibit 10.5 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Binah Capital Group, Inc.

Guarantee Agreement (incorporated by reference to Exhibit 10.6 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

MHC Securities LLC Guarantee Agreement (incorporated by reference to Exhibit 10.7 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Kingswood Capital Acquisition Corp.

Guarantee Agreement (incorporated by reference to Exhibit 10.8 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Craig Gould Guarantee Agreement (incorporated by reference to Exhibit 10.9 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Alexander Markowitz Guarantee Agreement (incorporated by reference to Exhibit 10.10 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Stock Pledge Agreement, dated March 15, 2024, by and among Craig Gould, MHC Securities, LLC and Oak Street Funding LLC.

(incorporated by reference to Exhibit 10.11 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Strategic Alliance Agreement, dated March 15, 2024, by and between Binah Capital Group, Inc.

and Kingswood US LLC.

(incorporated by reference to Exhibit 10.12 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Executive Employment Agreement, dated August 14, 2024, by and between Craig Gould and Binah Capital Group, Inc.

Executive Employment Agreement, dated August 14, 2024, by and between David Shane and Binah Capital Group, Inc.

Certification of Craig Gould, Chief Executive Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.

11 unchanged sentences

** Furnished herewith

∔ Certain identified information has been excluded from the exhibit pursuant to Item 601(a)(6) and/or Item 601(b)(10)(iv) of Regulation S-K.

† Indicates a management contract or compensatory plan or arrangement.

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BINAH CAPITAL GROUP, INC.

August 14, 2024

/s/ Craig Gould

1 unchanged sentence

(Principal Executive Officer)

August 14, 2024

/s/ David Shane

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 5. Other Information