Exhibit 10.1
LADENBURG THALMANN FINANCIAL SERVICES INC.
153 East 53rd Street
New York, New York 10022
September 14, 2006
Vector Group Ltd.
100 S.E. Second Street
Miami, Florida 33131
Attn.: Howard M. Lorber, President
Gentlemen:
This letter agreement will confirm the understanding between Ladenburg Thalmann Financial
Services Inc. (Company), a Florida corporation with offices at 153 East 53rd Street,
New York, New York 10022, and Vector Group Ltd. (VGL), a Delaware corporation with offices at 100
S.E. Second Street, Miami, Florida 33131, under which VGL will provide certain services to the
Company.
As reasonably requested by the Company, VGL will provide the following services (Services)
to the Company: (i) VGL will make available to the Company the services of Richard J. Lampen, VGLs
Executive Vice President, to serve as the Companys Chief Executive Officer; and (ii) VGL will
provide, upon request of the Company, such other financial and accounting resources, including
assistance in complying with Section 404 of the Sarbanes-Oxley Act of 2002.
In consideration of the Services, the Company shall pay VGL an annual fee of $250,000, payable
in quarterly installments of $62,500 in advance, commencing September 1, 2006. Additionally, VGL
shall be entitled to recover all direct, out of pocket costs, fees and other expenses incurred by
VGL or Mr. Lampen in connection with the Services.
The Company shall indemnify, defend and hold harmless VGL from and against any loss,
liability, claim, demand, action, suit, proceeding, judgment, penalty, government investigation or
expense (including reasonable attorneys fees), whether or not involving a third-party claim,
proceeding, demand, or liability of any kind, (collectively, Damages) arising, directly or
indirectly, or alleged to arise, directly or indirectly, in anyway out of the provision of services
by Mr. Lampen hereunder.
VGL shall provide the Company with reasonably prompt written notice of a claim for any Damages
or the commencement of any claim, demand, proceeding, action or suit (collectively, Proceeding).
Any failure to notify the Company will not relieve the Company of its indemnification obligation
hereunder except to the extent that the Company demonstrates that the defense of a Proceeding by
the Company was materially prejudiced by failure or delay to give such notice. The Company shall
diligently assume the defense, including payment thereof, of any Proceeding through counsel
selected by the Company (and not reasonably objected to by VGL). The Company shall have the right
to compromise or settle such matters (and VGL shall not have such right) provided however, that no
compromise or settlement of any such Proceeding may be effected by the Company without the consent
of VGL, such consent not to be unreasonably withheld or delayed, unless (a) there is no finding or
admission of any violation of law by VGL and (b) the sole remedy provided thereunder is monetary
damages which will be paid in full by the Company and the Company demonstrates the capacity to do
so.
Our
agreement will commence on September 6, 2006 and will terminate upon not less than 30
days prior written notice by either of us.
Please indicate your acceptance by signing this letter in the space provided below.
LADENBURG THALMANN
FINANCIAL SERVICES INC.