Exhibit 10.3
FORM OF RECKSON ASSOCIATES REALTY CORP.
CHANGE-IN-CONTROL AGREEMENT
WHEREAS, _______________ (the "Executive") is an executive officer of
Reckson Associates Realty Corp. (the "Company") or one of its Affiliates;
WHEREAS, the Executive has received an award of LTIP OP Units (the "LTIP
OP Units") pursuant to the Long-Term Incentive Plan OP Unit Award Agreement,
dated as of ____ __, ____ between Executive, the Company and Reckson Operating
Partnership (the "LTIP Award Agreement"); and
WHEREAS, the Company desires to provide the Executive with an additional
incentive in the event that a Change-in-Control occurs prior to the complete
book-up of the LTIP OP Units, thereby denying the Executive the intended
benefit of the LTIP OP Units awarded.
NOW, THEREFORE, the Company and the Executive hereby agree as follows:
1. Change-in-Control Bonus:
(a) In the event the LTIP OP Units held by the Executive are redeemed
or otherwise cashed-out in connection with the occurrence of a
Change-in-Control, the Executive shall be entitled to receive from the Company
a cash bonus determined as follow:
A = (B minus C), multiplied by D, where:
A equals the amount of the cash bonus to be paid to the Executive
by the Company;
B equals the per OPU consideration received by a holder of an OPU
in connection with the Change-in-Control;
C equals the per vested LTIP OP Unit consideration received by the
Executive in connection with the Change-in-Control (but in no
event shall C be greater than B); and
D equals the number of vested LTIP OP Units held by the Executive
that are redeemed or otherwise cashed-out in connection with the
Change-in-Control.
For example, if Executive holds 100 LTIP OP Units, all 100 LTIP OP Units are
vested or become vested in connection with Change-of Control, the LTIP OP
Units are cashed-out in connection with a Change-in-Control for $5 per LTIP OP
Unit, and the OPU are cashed-out for $7 per OPU, then Executive will be
entitled to receive a cash bonus of $200 hereunder ($7 minus $5, multiplied by
100).
(b) Said amount shall be payable in one lump sum payment no later than
31 days following the date the LTIP OP Units held by the Executive are
redeemed or otherwise cashed-out.
(c) Amounts payable pursuant to this Agreement are intended to
supplement the LTIP Award Agreement and the Employment Agreement.
2. Term. This Agreement shall terminate upon the earlier of (a) the
date on which the Executive no longer holds LTIP OP Units, other than as a
result of the redemption or other cash-out of such LTIP OP Units in connection
with the occurrence of a Change-in-Control, or (b) the payment of all amounts
owed hereunder to the Executive.
3. Governing Law. This Agreement is made under, and will be construed
in accordance with, the laws of the State of New York, without giving effect
to the principle of conflict of laws of such State.
4. Transferability. This Agreement is personal to the Executive, is
non-assignable and is not transferable in any manner, by operation of law or
otherwise, other than by will or the laws of descent and distribution.
5. Amendment. The Executive acknowledges that this Agreement may be
amended or canceled by the Company for the purpose of satisfying changes in
law or for any other lawful purpose, provided that no such action shall
adversely affect the Executive's rights under this Agreement without the
Executive's written consent.
6. No Obligation to Continue Employment. Neither the Company nor any
Affiliate is obligated by or as a result of this Agreement to continue the
Executive in employment and this Agreement shall not interfere in any way with
the right of the Company or any Affiliate to terminate the employment of the
Executive at any time.
7. Withholding and Taxes. No later than the date as of which an
amount first becomes includible in the gross income of the Executive for
income tax purposes or subject to Federal Insurance Contributions Act
withholding with respect to any award under this Agreement, such Executive
will pay to the Company or, if appropriate, any of its Affiliates, or make
arrangements satisfactory to the Company's Board of Directors regarding the
payment of, any United States federal, state or local or foreign taxes of any
kind required by law to be withheld with respect to such amount. The
obligations of the Company under this Agreement will be conditional on such
payment or arrangements, and the Company and its Affiliates shall, to the
extent permitted by law, have the right to deduct any such taxes from any
payment otherwise due to the Executive.
8. Successors and Assigns. This Agreement shall be binding upon the
Company's successors and assigns, whether or not this Agreement is expressly
assumed.
9. Definitions. Capitalized terms used but not otherwise defined
herein shall have the respective meanings ascribed to such terms in the LTIP
Award Agreement.
[signature page follows]
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the _____ day of __________, 2004.
RECKSON ASSOCIATES REALTY CORP.
By:
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Name:
Title:
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The Executive
Name:
