Exhibit 10.116
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
FOR
XXXXX XXXXXXXXX
TABLE OF CONTENTS
Page
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1. Employment. 2
2. Employment Period. 2
3. Services / Place of Employment. 3
4. Compensation and Benefits. 4
5. Termination of Employment and Change in Control. 6
6. Compensation Upon Termination of Employment By the Company for
Cause or By Executive without Good Reason. 9
7. Compensation Upon Termination of Employment Upon Death or
Disability. 10
8. Compensation Upon Termination of Employment By the Company
Without Cause or By Executive for Good Reason. 12
9. Change in Control. 13
10. Mitigation / Effect on Employee Benefit Plans and Programs. 17
11. Confidential Information. 17
12. Return of Documents. 18
13. Noncompete. 19
14. Remedies. 20
15. Indemnification/Legal Fees. 21
16. Successors and Assigns. 22
17. Timing of and No Duplication of Payments. 24
18. Modification or Waiver. 24
19. Notices. 25
20. Governing Law. 25
21. Severability. 25
22. Legal Representation. 26
23. Counterparts. 26
24. Headings. 26
25. Entire Agreement. 26
26. Survival of Agreements. 26
XXXXX XXXXXXXXX
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (the "Agreement") is entered
into as of December , 1997, by and between Xxxxx Xxxxxxxxx, an individual
residing at 0 Xxxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000 ("Executive"), and
Xxxx-Xxxx Realty Corporation, a Maryland corporation with offices at 00 Xxxxxxxx
Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 (the "Company").
RECITALS
Whereas, Executive has served as Executive Vice President - Finance and
Chief Financial Officer of the Company pursuant to his prior employment
agreement dated as of January 21, 1997 (the "Prior Agreement") and prior thereto
and, through such service, has acquired special and unique knowledge, abilities
and expertise;
Whereas, in connection with the combination of Cali Realty Corporation with
the Xxxx Companies (the "Xxxx Combination") the Prior Agreement is hereby
amended and restated in its entirety as of the closing of the Xxxx Combination;
and
Whereas, the Company desires to continue to employ Executive as Executive
Vice President - Finance and Chief Financial Officer, and Executive desires to
continue to be employed by the Company as Executive Vice President - Finance and
Chief Financial Officer, pursuant to the amended and restated terms set forth
herein.
Now, Therefore, in consideration of the premises and the mutual covenants
and agreements set forth herein, the parties hereby agree as follows:
1. Employment.
The Company hereby agrees to employ Executive, and Executive hereby agrees
to accept such employment during the period and upon the terms and conditions
set forth in this Agreement.
2. Employment Period.
(a) Except as otherwise provided in this Agreement to the contrary,
the terms and conditions of this Agreement shall be and remain in effect during
the period of employment (the "Employment Period") established under this
Paragraph 2. The initial Employment Period shall be for a term commencing on
the date of this Agreement and ending on the fifth anniversary of the date of
this Agreement provided, however, that commencing on the day after the date of
this Agreement and on each day thereafter, the Employment Period shall be
extended for one additional day so that a constant five (5) year Employment
Period shall be in effect, unless (i) the Company or Executive elects not to
extend the term of this Agreement by giving written notice to the other party in
accordance with Paragraph 19, in which case, subject to the provisions of
sub-paragraph 5(a)(iv) below, the term of this Agreement shall become fixed and
shall end on the fifth anniversary of the date of such written notice ("Notice
of Non-Renewal"), or (ii) Executive's employment terminates hereunder.
(b) Notwithstanding anything contained herein to the contrary: (i)
Executive's employment with the Company may be terminated by the Company or
Executive during the Employment Period, subject to the terms and conditions of
this Agreement; and (ii) nothing in this Agreement shall mandate or prohibit a
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continuation of Executive's employment following the expiration of the
Employment Period upon such terms and conditions as the Board of Directors of
the Company (the "Board") and Executive may mutually agree.
(c) If Executive's employment with the Company is terminated, for
purposes of this Agreement the term "Unexpired Employment Period" shall mean the
period commencing on the date of such termination and ending on the last day of
the Employment Period.
3. Services / Place of Employment.
(a) Services. During the Employment Period, Executive shall hold the
positions of Executive Vice President - Finance and Chief Financial Officer of
the Company. Executive shall devote his best efforts and substantially all of
his business time, skill and attention to the business of the Company (other
than absences due to vacation, illness, disability or approved leave of
absence), and shall perform such duties as are customarily performed by similar
executive officers and as may be more specifically enumerated from time to time
by the Chief Executive Officer and President; provided, however, that the
foregoing is not intended to (a) preclude Executive from (i) owning and managing
personal investments, including real estate investments, subject to the
restrictions set forth in Paragraph 13 hereof or (ii) engaging in charitable
activities and community affairs, or (b) restrict or otherwise limit Executive
from conducting real estate development, acquisition or management activities
with respect to those properties described in Schedule A, attached hereto, (the
"Excluded Properties"), provided that the performance of the activities referred
3
to in clauses (a) and (b) does not prevent Executive from devoting substantially
all of his business time to the Company.
(b) Place of Employment. The principal place of employment of
Executive shall be at the Company's principal executive offices in Cranford, New
Jersey.
4. Compensation and Benefits.
(a) Salary. During the Employment Period, the Company shall pay
Executive a minimum annual base salary in the amount of $300,000 (the "Annual
Base Salary") payable in accordance with the Company's regular payroll
practices. Executive's Annual Base Salary shall be reviewed annually in
accordance with the policy of the Company from time to time and may be subject
to upward adjustment based upon, among other things, Executive's performance, as
determined in the sole discretion of the Chief Executive Officer and the
President. In no event shall Executive's Annual Base Salary in effect at a
particular time be reduced without his prior written consent.
(b) Incentive Compensation/Bonuses. In addition, Executive shall be
eligible for incentive compensation payable each year in such amounts as may be
determined by the Option and Executive Compensation Committee of the Board (the
"Compensation Committee") based upon, among other factors, growth in Funds from
Operations per Common Share (as hereinafter defined) for the year. Executive
shall be entitled to receive such bonuses and options to purchase shares of
common stock, par value $0.01 per share, of the Company (the "Common Stock") as
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the Board or the Compensation Committee as the case may be shall approve, in its
sole discretion, including, without limitation, options and bonuses contingent
upon Executive's performance and the achievement of specified financial and
operating objectives for Funds from Operations per Common Share. For purposes
of this Agreement, "Funds from Operations per Common Share" for any period shall
mean (i) net income (loss) before minority interest of unit holders, computed in
accordance with generally accepted accounting principles ("GAAP"), excluding
gains (or losses) from debt restructuring and sale of property, plus real estate
return, depreciation and amortization as calculated in accordance with the
National Association of Real Estate Investment Trusts definition published in
March 1995, as amended from time to time, and as applied in accordance with the
accounting practices and policies of the Company in effect from time to time on
a consistent basis to the entire Employment Period, divided by (ii) the sum of
(A) the primary weighted average number of outstanding shares of Common Stock as
it appears in the Company's financial statement for the applicable period and
(B) the primary weighted average number of outstanding common limited
partnership units ("Common OP Units") of Xxxx-Xxxx Realty, L.P., a Delaware
limited partnership (the "Partnership") of which the Company is the sole general
partner, for the applicable period. All classes of preferred stock which are
convertible into Common Stock and all classes of preferred or other units which
are convertible into Common OP Units shall be treated as if they have been
converted into Common Stock or Common OP Units and shall be included in the
denominator, irrespective of any waiting period which must elapse prior to
conversion.
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(c) Taxes and Withholding. The Company shall have the right to
deduct and withhold from all compensation all social security and other federal,
state and local taxes and charges which currently are or which hereafter may be
required by law to be so deducted and withheld.
(d) Additional Benefits. In addition to the compensation specified
above and other benefits provided pursuant to this Paragraph 4, Executive shall
be entitled to the following benefits:
(i) participation in the Employee Stock Option Plan of Cali Realty
Corporation, the Cali Realty Corporation 401(k) Savings and
Retirement Plan (subject to statutory rules and maximum
contributions and non-discrimination requirements applicable to
401(k) plans) and such other benefit plans and programs ,
including but not limited to restricted stock, phantom stock
and/or unit awards, loan programs and any other incentive
compensation plans or programs (whether or not employee benefit
plans or programs), as maintained by the Company from time to
time and made generally available to executives of the Company
with such participation to be consistent with reasonable Company
guidelines;
(ii) participation in any health insurance, disability insurance, paid
vacation, group life insurance or other welfare benefit program
made generally available to executives of the Company; and
(iii) reimbursement for reasonable business expenses incurred by
Executive in furtherance of the interests of the Company
including a monthly allowance of twelve hundred ($1,200) which is
intended to cover the cost of local business-related travel
expenses exclusive of amounts paid to third-parties (e.g. taxi
service).
5. Termination of Employment and Change in Control.
(a) Executive's employment hereunder may be terminated during the
Employment Period under the following circumstances:
(i) Cause. The Company shall have the right to terminate Executive's
employment for Cause upon Executive's: (A) willful and continued
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failure to use best efforts to substantially perform his duties
hereunder (other than any such failure resulting from Executive's
incapacity due to physical or mental illness) for a period of
thirty (30) days after written demand for substantial performance
is delivered by the Company specifically identifying the manner
in which the Company believes Executive has not substantially
performed his duties; (B) willful misconduct and/or willful
violation of Paragraph 11 hereof, which is materially
economically injurious to the Company and the Partnership taken
as a whole; (C) the willful violation of the provisions of
Paragraph 13 hereof; or (D) conviction of, or plea of guilty to a
felony. For purposes of this sub-paragraph 5(a), no act, or
failure to act, on Executive's part shall be considered "willful"
unless done, or omitted to be done, by him (I) not in good faith
and (II) without reasonable belief that his action or omission
was in furtherance of the interests of the Company.
(ii) Death. Executive's employment hereunder shall terminate upon his
death.
(iii) Disability. The Company shall have the right to terminate
Executive's employment due to "Disability" in the event that
there is a determination by the Company, upon the advice of an
independent qualified physician, reasonably acceptable to
Executive, that Executive has become physically or mentally
incapable of performing his duties under this Agreement and such
disability has disabled Executive for a cumulative period of one
hundred eighty (180) days within a twelve (12) month period.
(iv) Good Reason. Executive shall have the right to terminate his
employment for "Good Reason": (A) upon the occurrence of any
material breach of this Agreement by the Company which shall
include but not be limited to; an assignment to Executive of
duties materially and adversely inconsistent with Executive's
status as Executive Vice President - Finance and Chief Financial
Officer or a material or adverse alteration in the nature of or
diminution in Executive's duties and/or responsibilities,
reporting obligations, titles or authority; (B) upon a reduction
in Executive's Annual Base Salary or a material reduction in
other benefits (except for bonuses or similar discretionary
payments) as in effect at the time in question, a failure to pay
such amounts when due or any other failure by the Company to
comply with Paragraph 4 hereof; (C) within six (6) months
following the date a Notice of Non-Renewal is issued by the
Company pursuant to Paragraph 2 hereof; (D) on or within six (6)
months following a Change in Control (as hereinafter defined) in
accordance with the provisions set forth in sub-paragraph
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5(a)(vii) hereof; (E) any purported termination of Executive's
employment for Cause which is not effected pursuant to the
procedures of sub-paragraph 5(a)(i) (and for purposes of this
Agreement, in the event of such failure to comply, no such
purported termination shall be effective); or (F) upon the
relocation of the Company's principal executive offices or
Executive's own office location to a location more than thirty
(30) miles away from Cranford, New Jersey.
(v) Without Cause. The Company shall have the right to terminate the
Executive's employment hereunder without Cause subject to the
terms and conditions of this Agreement.
(vi) Without Good Reason. The Executive shall have the right to
terminate his employment hereunder without Good Reason subject to
the terms and conditions of this Agreement.
(vii) Change in Control. Executive shall have the right to terminate
his employment hereunder on or within six (6) months following a
Change in Control. Such termination shall be deemed a
termination for Good Reason hereunder. For purposes of this
Agreement "Change in Control" shall mean that any of the
following events has occurred: (A) any "person" or "group" of
persons, as such terms are used in Sections 13 and 14 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
other than any employee benefit plan sponsored by the Company,
becomes the "beneficial owner", as such term is used in Section
13 of the Exchange Act, (irrespective of any vesting or waiting
periods) of (I) Common Stock or any class of stock convertible
into Common Stock and/or (II) Common OP Units or preferred units
or any other class of units convertible into Common OP Units, in
an amount equal to twenty (20%) percent or more of the sum total
of the Common Stock and the Common OP Units (treating all classes
of outstanding stock, units or other securities convertible into
stock units as if they were converted into Common Stock or Common
OP Units as the case may be and then treating Common Stock and
Common OP Units as if they were a single class) issued and
outstanding immediately prior to such acquisition as if they were
a single class and disregarding any equity raise in connection
with the financing of such transaction; (B) any Common Stock is
purchased pursuant to a tender or exchange offer other than an
offer by the Company; (C) the dissolution or liquidation of the
Company or the consummation of any merger or consolidation of the
Company or any sale or other disposition of all or substantially
all of its assets, if the shareholders of the Company and
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unitholders of the Partnership taken as a whole and considered as
one class immediately before such transaction own, immediately
after consummation of such transaction, equity securities and
partnership units possessing less than fifty (50%) percent of the
surviving or acquiring company and partnership taken as a whole;
or (D) a turnover, during any two (2) year period, of the
majority of the members of the Board, without the consent of the
remaining members of the Board as to the appointment of the new
Board members.
(b) Notice of Termination. Any termination of Executive's employment
by the Company or any such termination by Executive (other than on account of
death) shall be communicated by written Notice of Termination to the other party
hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of Executive's employment under the
provision so indicated. In the event of the termination of Executive's
employment on account of death, written Notice of Termination shall be deemed to
have been provided on the date of death.
6. Compensation Upon Termination of Employment By the Company for
Cause or By Executive without Good Reason.
In the event the Company terminates Executive's employment for Cause or
Executive terminates his employment without Good Reason, the Company shall pay
Executive any unpaid Annual Base Salary at the rate then in effect accrued
through and including the date of termination. In addition, in such event,
Executive shall be entitled (i) to receive any earned but unpaid incentive
9
compensation or bonuses and (ii) to exercise any options which have vested and
are exercisable in accordance with the terms of the applicable option grant
agreement or plan.
Except for any rights which Executive may have to unpaid salary amounts
through and including the date of termination, earned but unpaid incentive
compensation or bonuses and vested options, the Company shall have no further
obligations hereunder following such termination. The aforesaid amounts shall
be payable in full immediately upon such termination.
7. Compensation Upon Termination of Employment Upon Death or Disability.
In the event of termination of Executive's employment as a result of either
Executive's death or Disability, the Company shall pay to Executive, his estate
or his personal representative (i) the unpaid Annual Base Salary at the rate
then in effect through the end of the Unexpired Employment Period (the "Annual
Base Salary Payment"); (ii) a pro-rata portion, based upon the number of days in
the period beginning with the date of the termination of Executive's employment
due to death or Disability and ending with the last day of the Unexpired
Employment Period, of the cash equivalent of the average annual amount of all
other compensation based on the average of the last two (2) calendar years
immediately preceding the year in which Executive's termination of employment
occurs including, without limitation, incentive compensation payments, bonuses
and stock based compensation (e.g., stock options, restricted stock awards,
etc.) paid, granted or accreted to Executive during such years (the "Pro-Rata
Portion of Other Compensation") and (iii) reimbursement of expenses incurred
prior to date of termination ("Expense Reimbursement"). The aforesaid
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amounts shall be payable in cash without discount for early payment, at the
option of Executive, his estate or his personal representative, either in
full immediately upon such termination or monthly over the Unexpired
Employment Period (the "Payment Election"). In the event of termination of
employment due to Disability, Executive shall also receive continuation of
health coverage through the end of the Unexpired Employment Period on the
same basis as health coverage is provided by the Company for active employees
and as may be amended from time to time ("Medical Continuation").
In addition, all (A) incentive compensation payments or programs of any
nature whether stock based or otherwise that are subject to a vesting schedule
including, without limitation, restricted stock, phantom stock, units and any
loan forgiveness arrangements granted to Executive ("Incentive Compensation")
shall immediately vest as of the date of such termination ("Vested Incentive
Compensation") and (B) options granted to Executive shall immediately vest as of
the date of such termination (the "Vested Options") and Executive shall be
entitled at the option of Executive, his estate or his personal representative,
within one (1) year of the date of such termination, to exercise any options
which have vested (including, without limitation, by acceleration in accordance
with the terms of this Agreement, the applicable option grant agreement or plan)
and are exercisable in accordance with the terms of the applicable option grant
agreement or plan and/or any other methods or procedures for exercise applicable
to optionees or to require the Company (upon written notice delivered within one
hundred eighty (180) days following the date of Executive's termination) to
repurchase all or any portion of Executive's vested options to purchase shares
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of Common Stock at a price equal to the difference between the Repurchase Fair
Market Value (as hereinafter defined) of the shares of Common Stock for which
the options to be repurchased are exercisable and the exercise price of such
options as of the date of Executive's termination of employment (the "Vested
Option Exercise Election"). In the event of a conflict between any option grant
agreement or plan and this Agreement, the terms of this Agreement shall control.
Except for any rights which Executive may have to all of the above including the
Annual Base Salary Payment, the Pro-Rata Portion of Other Compensation, Vested
Incentive Compensation, Vested Options, Expense Reimbursement and in the event
of a termination of employment due to Disability, Medical Continuation, the
Company shall have no further obligations hereunder following such termination.
For purposes of this Agreement, "Repurchase Fair Market Value" shall mean the
average of the closing price on the New York Stock Exchange (or such other
exchange on which the Common Stock is primarily traded) of the Common Stock on
each of the trading days within the thirty (30) days immediately preceding the
date of termination of Executive's employment.
8. Compensation Upon Termination of Employment By the Company Without
Cause or By Executive for Good Reason.
In the event the Company terminates Executive's employment for any reason
other than Cause or Executive terminates his employment for Good Reason, the
Company shall pay to Executive and Executive shall be entitled to receive the
greater of (i) three million dollars ($3,000,000) with such amount subject only
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to upwards adjustment from time to time by the Compensation Committee (the
"Fixed Amount") or (ii) the sum total of (A) the Annual Base Salary Payment and
(B) the Pro-Rata Portion of Other Compensation. The aforesaid amount shall be
payable in cash without discount for early payment, at the option of Executive,
either in full immediately upon such termination or monthly over the Unexpired
Employment Period.
In addition, the Executive shall be entitled to receive Vested Incentive
Compensation, Vested Options exercisable pursuant to the Vested Option Exercise
Election, Medical Continuation, and Expense Reimbursement. Executive
understands that any options exercised more than ninety (90) days following the
date of his termination of employment which were granted as incentive stock
options shall automatically be converted into non-qualified options.
Except for any rights which Executive may have to Vested Incentive Compensation,
Vested Options, Medical Continuation and Expense Reimbursement and either the
Fixed Amount or in lieu thereof to the Annual Base Salary Payment, and the
Pro-Rata Portion of Other Compensation (as defined in Paragraph 7), the Company
shall have no further obligations hereunder following such termination. The
parties both agree that the agreement to make these payments was consideration
and an inducement to obtain Executive's consent to enter into this Agreement.
The payments are not a penalty and neither party will claim them to be a
penalty. Rather, the payments represent a fair approximation of reasonable
amounts due to Executive for the Employment Period.
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9. Change in Control.
(a) Options. Any Incentive Compensation and options granted to
Executive that have not vested as of the date of a Change in Control shall
immediately vest upon the date of the Change in Control. Neither the occurrence
of a Change in Control, nor the vesting in any options as a result thereof shall
require Executive to exercise any options. In the event of a conflict between
any Incentive Compensation grant agreement or program or any option grant
agreement or plan and this Agreement, the terms of this Agreement shall control.
(b) Upon Termination. In the event Executive terminates his
employment on or following a Change in Control as set forth in sub-paragraph
5(a)(vii), the Company shall pay to Executive and Executive shall be entitled to
all the payments and rights Executive would have had if Executive had terminated
his employment with Good Reason as set forth in Paragraph 8.
The aforesaid amount shall be payable in accordance with Executive's
Payment Election.
Except for any rights which Executive may have to Vested Incentive
Compensation, Vested Options (including, without limitation, by acceleration in
accordance with sub-paragraph 9(a)), Medical Continuation, Expense Reimbursement
and the Excise Tax Gross Up set forth in subparagraph 9(d), and either the
Fixed Amount or in lieu thereof to the Annual Base Salary Payment, and the
Pro-Rata Portion of Other Compensation (as defined in Paragraph 7), the Company
shall have no further obligations hereunder following such termination.
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(c) Retention Payment. Prior to the date of a Change in Control and
subject to the approval of the Board, Executive may make an election to receive,
as a retention payment, the payments and rights set forth sub-paragraph 9(b)
above (the "Retention Payment") and remain in the employ of the successor after
the Change in Control. In the event that Executive makes such election and the
Board approves the same, this Agreement shall remain in full force and effect
except that (i) simultaneously with the receipt of the Retention Payment,
Executive shall waive any right to receive any additional payment as a direct
result of such Change in Control, and (ii) other than with respect to the
consummation of a subsequent transaction which constitutes a Change in Control
and is unrelated to the Change in Control with respect to which the Retention
Payment was paid, termination payments otherwise due subsequently under this
Agreement for any event requiring payment of termination payments under this
Agreement which occurs within the six (6) month period immediately following the
date of the Change In Control as to which the Retention Payment was paid shall
be reduced by the Retention Payment paid to Executive on the date of the Change
in Control.
Any cash payments owed to Executive pursuant to this sub-paragraph 9(c)
shall be paid to Executive in a single sum without discount for early payment at
the time of the Change in Control but prior to the consummation of the
transaction with any successor.
(d) Excise Tax Gross Up. In addition, if it is determined by an
independent accountant mutually acceptable to the Company and Executive that as
a result of any payment in the nature of compensation made by the Company to (or
for the benefit of) Executive pursuant to this Agreement or otherwise, an excise
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tax may be imposed on Executive pursuant to Section 4999 of the Code (or any
successor provisions), the Company shall pay Executive in cash an amount equal
to X determined under the following formula: (the "Excise Tax Gross Up"):
X = E x P
------------------------------------
1-[(FI x (1-SLI)) + SLI + E + M]
where
E = the rate at which the excise tax is assessed under Section 4999 of
the Code (or any successor provisions);
P = the amount with respect to which such excise tax is assessed,
determined without regard to the Excise Tax Gross Up;
FI = the highest effective marginal rate of income tax applicable to
Executive under the Code for the taxable year in question (taking
into account any phase-out or loss of deductions, personal exemptions
or other similar adjustments);
SLI = the sum of the highest effective marginal rates of income tax
applicable to Executive under all applicable state and local laws
for the taxable year in question (taking into account any phase-out
or loss of deductions, personal exemptions and other similar
adjustments); and
M = the highest marginal rate of Medicare tax applicable to Executive
under the Code for the taxable year in question.
With respect to any payment in the nature of compensation that is made to (or
for the benefit of) Executive under the terms of this Agreement or otherwise and
on which an excise tax under Section 4999 of the Code (or any successor
provisions) may be assessed, the payment determined under this sub-paragraph
9(d) shall be paid to Executive at the time of the Change in Control but prior
to the consummation of the transaction with any successor. It is the intention
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of the parties that the Company provide Executive with a full tax gross-up under
the provisions of this Paragraph, so that on a net after-tax basis, the result
to Executive shall be the same as if the excise tax under Section 4999 of the
Code (or any successor provisions) had not been imposed. The Excise Tax Gross
Up may be adjusted if alternative minimum tax rules are applicable to Executive.
10. Mitigation / Effect on Employee Benefit Plans and Programs.
(a) Mitigation. Executive shall not be required to mitigate amounts
payable under this Agreement by seeking other employment or otherwise, and there
shall be no offset against amounts due Executive under this Agreement on account
of subsequent employment. Amounts owed to Executive under this Agreement shall
not be offset by any claims the Company may have against Executive and such
payment shall not be affected by any other circumstances, including, without
limitation, any counterclaim, recoupment, defense, or other right which the
Company may have against Executive or others.
(b) Effect on Employee Benefit Programs. The termination of
Executive's employment hereunder, whether by the Company or Executive, shall
have no effect on the rights and obligations of the parties hereto under the
Company's (i) welfare benefit plans including, without limitation, Medical
Continuation as provided for herein and, health coverage thereafter but only to
the extent required by law, and on the same basis applicable to other employees
and (ii) 401(k) Plan but only to the extent required by law and pursuant to the
terms of the 401(k) Plan.
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11. Confidential Information.
(a) Executive understands and acknowledges that during his employment
with the Company, he will be exposed to Confidential Information (as defined
below), all of which is proprietary and which will rightfully belong to the
Company. Executive shall hold in a fiduciary capacity for the benefit of the
Company such Confidential Information obtained by Executive during his
employment with the Company and shall not, directly or indirectly, at any time,
either during or after his employment with the Company, without the Company's
prior written consent, use any of such Confidential Information or disclose any
of such Confidential Information to any individual or entity other than the
Company or its employees, attorneys, accountants, financial advisors,
consultants, or investment bankers except as required in the performance of his
duties for the Company or as otherwise required by law. Executive shall take
all reasonable steps to safeguard such Confidential Information and to protect
such Confidential Information against disclosure, misuse, loss or theft.
(b) The term "Confidential Information" shall mean any information
not generally known in the relevant trade or industry or otherwise not generally
available to the public, which was obtained from the Company or its predecessors
or which was learned, discovered, developed, conceived, originated or prepared
during or as a result of the performance of any services by Executive on behalf
of the Company or its predecessors. For purposes of this Paragraph 11, the
Company shall be deemed to include any entity which is controlled, directly or
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indirectly, by the Company and any entity of which a majority of the economic
interest is owned, directly or indirectly, by the Company.
12. Return of Documents.
Except for such items which are of a personal nature to Executive (e.g., daily
business planner), all writings, records, and other documents and things
containing any Confidential Information shall be the exclusive property of the
Company, shall not be copied, summarized, extracted from, or removed from the
premises of the Company, except in pursuit of the business of the Company and at
the direction of the Company, and shall be delivered to the Company, without
retaining any copies, upon the termination of Executive's employment or at any
time as requested by the Company.
13. Noncompete.
Executive agrees that:
(a) During the Employment Period and, in the event (i) the Company
terminates Executive's employment for Cause, or (ii) Executive terminates his
employment without Good Reason, for a one (1) year period thereafter, Executive
shall not, directly or indirectly, within the continental United States, engage
in, or own, invest in, manage or control any venture or enterprise primarily
engaged in any office-service, flex, or office property development, acquisition
or management activities without regard to whether or not such activities
compete with the Company. Nothing herein shall prohibit Executive from being a
passive owner of not more than five percent (5%) of the outstanding stock of any
class of securities of a corporation or other entity engaged in such business
19
which is publicly traded, so long as he has no active participation in the
business of such corporation or other entity. Moreover, the foregoing
limitations shall not be deemed to restrict or otherwise limit Executive from
conducting real estate development, acquisition or management activities with
respect to the Excluded Properties, if any, provided that during the Employment
Period the performance of such activities does not prevent Executive from
devoting substantially all of his business time to the Company.
(b) If, at the time of enforcement of this Paragraph 13, a court
shall hold that the duration, scope, area or other restrictions stated herein
are unreasonable, the parties agree that reasonable maximum duration, scope,
area or other restrictions may be substituted by such court for the stated
duration, scope, area or other restrictions and upon substitution by such court,
this Agreement shall be automatically modified without further action by the
parties hereto.
(c) For purposes of this Paragraph 13, the Company shall be deemed to
include any entity which is controlled, directly or indirectly, by the Company
and any entity of which a majority of the economic interest is owned, directly
or indirectly, by the Company.
14. Remedies.
The parties hereto agree that the Company would suffer irreparable harm
from a breach by Executive of any of the covenants or agreements contained in
Paragraphs 11, 12 or 13 of this Agreement. Therefore, in the event of the
actual or threatened breach by Executive of any of the provisions of Paragraphs
11, 12 or 13 of this Agreement, the Company may, in addition and supplementary
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to other rights and remedies existing in its favor, apply to any court of law or
equity of competent jurisdiction for specific performance and/or injunctive or
other relief in order to enforce or prevent any violation of the provisions
thereof.
15. Indemnification/Legal Fees.
(a) Indemnification. In the event the Executive is made party or
threatened to be made a party to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of
Executive's employment with or serving as an officer or director of the Company,
whether or not the basis of such Proceeding is alleged action in an official
capacity, the Company shall indemnify, hold harmless and defend Executive to the
fullest extent authorized by Maryland law, as the same exists and may hereafter
be amended, against any and all claims, demands, suits, judgments, assessments
and settlements including all expenses incurred or suffered by Executive in
connection therewith (including, without limitation, all legal fees incurred
using counsel reasonably acceptable to Executive) and such indemnification shall
continue as to Executive even after Executive is no longer employed by the
Company and shall inure to the benefit of his heirs, executors, and
administrators. Expenses incurred by Executive in connection with any
Proceeding shall be paid by the Company in advance upon request of Executive
that the Company pay such expenses; but, only in the event that Executive shall
have delivered in writing to the Company an undertaking to reimburse the Company
for expenses with respect to which Executive is not entitled to indemnification.
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The provisions of this Paragraph shall remain in effect after this Agreement is
terminated irrespective of the reasons for termination. The indemnification
provisions of this Paragraph shall not supersede or reduce any indemnification
provided to Executive under any separate agreement, or the by-laws of the
Company since it is intended that this Agreement shall expand and extend the
Executive's rights to receive indemnity.
(b) Legal Fees. If any contest or dispute shall arise between the
Company and Executive regarding or as a result of any provision of this
Agreement, the Company shall reimburse Executive for all legal fees and expenses
reasonably incurred by Executive in connection with such contest or dispute, but
only if Executive is successful in respect of substantially all of Executive's
claims pursued or defended in connection with such contest or dispute. Such
reimbursement shall be made as soon as practicable following the resolution of
such contest or dispute (whether or not appealed).
16. Successors and Assigns.
(a) The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, by agreement in
form and substance satisfactory to Executive, to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such agreement prior to the effectiveness of an
such succession shall be a breach of this Agreement and shall entitle Executive
to compensation from the Company in the same amount and on the same terms as he
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would be entitled to hereunder if Executive terminated his employment hereunder
within six (6) months of a Change in Control as set forth in Paragraph 9, except
that for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the date of termination. In the
event of such a breach of this Agreement, the Notice of Termination shall
specify such date as the date of termination. As used in this Agreement,
"Company" shall mean the Company as hereinbefore defined and any successor to
all or substantially all of its business and/or its assets as aforesaid which
executes and delivers the agreement provided for in this Paragraph 16 or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law. Any cash payments owed to Executive pursuant to this
Paragraph 16 shall be paid to Executive in a single sum without discount for
early payment immediately prior to the consummation of the transaction with such
successor.
(b) This Agreement and all rights of Executive hereunder may be
transferred only by will or the laws of descent and distribution. Upon
Executive's death, this Agreement and all rights of Executive hereunder shall
inure to the benefit of and be enforceable by Executive's beneficiary or
beneficiaries, personal or legal representatives, or estate, to the extent any
such person succeeds to Executive's interests under this Agreement. Executive
shall be entitled to select and change a beneficiary or beneficiaries to receive
any benefit or compensation payable hereunder following Executive's death by
giving Company written notice thereof. If Executive should die following the
date of termination while any amounts would still be payable to him hereunder if
he had continued to live, all such amounts, unless otherwise provided herein,
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shall be paid in accordance with the terms of this Agreement to such person or
persons so appointed in writing by Executive, including, without limitation,
under any applicable plan, or otherwise to his legal representatives or estate.
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17. Timing of and No Duplication of Payments.
All payments payable to Executive pursuant to this Agreement shall be paid
as soon as practicable after such amounts have become fully vested and
determinable. In addition, Executive shall not be entitled to receive duplicate
payments under any of the provisions of this Agreement.
18. Modification or Waiver.
No amendment, modification, waiver, termination or cancellation of this
Agreement shall be binding or effective for any purpose unless it is made in a
writing signed by the party against whom enforcement of such amendment,
modification, waiver, termination or cancellation is sought. No course of
dealing between or among the parties to this Agreement shall be deemed to affect
or to modify, amend or discharge any provision or term of this Agreement. No
delay on the part of the Company or Executive in the exercise of any of their
respective rights or remedies shall operate as a waiver thereof, and no single
or partial exercise by the Company or Executive of any such right or remedy
shall preclude other or further exercise thereof. A waiver of right or remedy
on any one occasion shall not be construed as a bar to or waiver of any such
right or remedy on any other occasion.
The respective rights and obligations of the parties hereunder shall
survive the Executive's termination of employment and termination of this
Agreement to the extent necessary for the intended preservation of such
rights and obligations.
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19. Notices.
All notices or other communications required or permitted hereunder shall be
made in writing and shall be deemed to have been duly given if delivered by hand
or delivered by a recognized delivery service or mailed, postage prepaid, by
express, certified or registered mail, return receipt requested, and addressed
to the Company or Executive, as applicable, at the address set forth above (or
to such other address as shall have been previously provided in accordance with
this Paragraph 19).
20. Governing Law.
This agreement will be governed by and construed in accordance with the
laws of the State of New Jersey except as to Paragraph 15(a), without regard to
principles of conflicts of laws thereunder.
21. Severability.
Whenever possible, each provision and term of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision or term of this Agreement shall be held to be prohibited by
or invalid under such applicable law, then, subject to the provisions of
sub-paragraph 13(b) above, such provision or term shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating or affecting
in any manner whatsoever the remainder of such provisions or term or the
remaining provisions or terms of this Agreement.
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22. Legal Representation.
Each of the Company and Executive have been represented by counsel with
respect to this Agreement.
23. Counterparts.
This Agreement may be executed in separate counterparts, each of which is deemed
to be an original and both of which taken together shall constitute one and the
same agreement.
24. Headings.
The headings of the Paragraphs of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part hereof and shall
not affect the construction or interpretation of this Agreement.
25. Entire Agreement.
This Agreement constitutes the entire agreement of the parties with respect
to the subject matter hereof and supersedes all other prior agreements and
undertakings, both written and oral, among the parties with respect to the
subject matter hereof. The parties recognize that the Prior Agreement has been
amended and restated in its entirety by this Agreement and the terms of the
Prior Agreement are of no further force and effect.
26. Survival of Agreements.
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The covenants made in Paragraphs 5 through 15 and 21 each shall survive the
termination of this Agreement.
In Witness Whereof, the undersigned have executed this Agreement as of the
date first above written.
XXXX-XXXX REALTY CORPORATION
By:
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Name:
Title:
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Xxxxx Xxxxxxxxx
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SCHEDULE A
None.
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