EXHIBIT 10.7.7
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), is made and entered into
as of the 17th day of December, 2001, by and between SUMMIT MANAGEMENT COMPANY,
a Maryland corporation, and Xxxxx X. Xxxxxx ("Employee").
STATEMENT OF PURPOSE
The "Company" (as hereinafter defined) is principally engaged in the
business of real estate acquisition, development, construction, management,
leasing and brokerage. The Company desires to employ Employee and Employee
desires to be employed in the business of the Company in the manner hereinafter
specified in order to obtain for the Company the benefit of Employee's
experience and expertise and also to make provision for payment of reasonable
and proper compensation to Employee for such services. For purposes of this
Agreement, the term "Company" means and refers to (i) Summit Management Company,
(ii) Summit Properties Inc., (iii) any business entity that is, directly or
indirectly, controlled by or under common control with Summit Properties Inc. or
(iv) any of their respective successors.
As previously agreed between the parties, this Agreement is being
executed as a condition precedent to the commencement of the employment of
Employee with the Company, and Employee has agreed to accept initial employment
subject to and in accordance with all the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and the aforesaid Statement of Purpose, the Company and Employee
hereby agree as follows:
1. Employment and Employee's Duties. The Company employs Employee to
assist the Company in expanding, developing, operating and managing its business
operations, primarily in the field of acquisition, development, management,
leasing and construction of real estate, and specifically, the acquisition,
development, management, leasing and construction of multi-family housing
developments and other commercial real estate projects. In such capacity,
Employee shall perform the duties and have responsibilities as may be assigned
to Employee from time to time by the Company. In the performance of Employee's
duties hereunder, Employee shall at all times be under the supervision, control
and direction of the Company, and Employee shall perform Employee's duties
hereunder in accordance with, and at all times strictly adhere to, all such
reasonable rules, regulations, guidelines and instructions as may be adopted
from time to time by the Company.
2. Sole Employment. Employee agrees to devote Employee's full time
during the customary business hours of the Company and give Employee's best
efforts to the business of the Company and, during the period of Employee's
employment by the Company, Employee shall not engage in any manner, whether as
an officer, employee, owner, partner, stockholder, director, consultant or
otherwise - directly or indirectly - in any business other than as provided for
herein without the prior written approval of the President of the Company, and
shall not accept any other employment whatsoever from any other person, firm,
corporation or entity; provided, however, that
Employee may acquire an interest in a business entity so long as such interest
is a passive investment of Employee not exceeding ten percent (10%) of the total
ownership interest in such entity.
3. Term. The employment relationship under the Agreement shall commence
as of the above written date (the "Effective Date") and shall continue until the
date ten (10) business days after written notice is given to the other party by
either the Company or Employee that the employment relationship shall terminate.
Such termination notice may be given by either party without cause and for any
or no reason.
4. Compensation.
(a) Base Salary. Commencing on the Effective Date (as defined
in paragraph 3), the Company shall pay employee during the term of Employee's
employment under this Agreement, a base salary equal to $200,000 per annum
(the "Base Salary"), which amount shall be subject to adjustment, if any, in
accordance with this paragraph 4(a). The Company shall review Employee's Base
Salary on an annual basis, and the Company upon such review and in its sole
discretion, may increase or decrease Employee's Base Salary by an amount which
the Company deems appropriate in light of the Company's and Employee's
performance during the period covered by such review. The Base Salary, less all
applicable withholding taxes, shall be paid to Employee in accordance with the
payroll procedures in effect with respect to officers of the Company.
(b) Incentive Compensation. In addition to the Base Salary
payable to Employee pursuant to paragraph 4(a) and any special compensatory
arrangements which the Company provides for Employee, effective as of the
Effective Date, Employee shall be entitled to participate in any incentive
compensation plans in effect with respect to employees of the Company whose
positions in the Company are commensurate to Employee's, with the criteria for
Employee's participation in such plans to be established by the Company in its
sole discretion.
(c) Stock Options. Employee shall be entitled to participate
in employee stock option plans from time to time established for the benefit of
employees of the Company in accordance with the terms and conditions of such
plans.
(d) Participation in Employee Benefit Plans. Employee shall be
entitled to participate in such medical, dental, disability, hospitalization,
life insurance, profit sharing and other benefit plans as the Company shall
maintain from time to time for the benefit of executive officers of the Company,
on the terms and subject to the conditions set forth in such plans.
(e) Compensation upon Termination of Employment. If Employee's
employment under this Agreement is terminated for any reason whatsoever,
Employee shall not thereafter be entitled to receive any Base Salary for periods
following such termination; provided, however, that Employee shall be entitled
to receive any Base Salary which may be owed to Employee but is unpaid as of the
date on which Employee's employment is terminated. The benefits, if any, payable
to or on behalf of Employee upon Employee's termination of employment from the
Company under any employee benefit plans and incentive compensation and other
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compensatory arrangements shall be governed by the terms and conditions for
benefit payments set forth in such plans and arrangements.
5. Employee's Obligations upon Termination of Employment.
(a) Definitions. For purposes of this paragraph 5, the
following terms shall have the following meanings:
"Affiliate" means (i) any entity directly or
indirectly controlling (including without limitation an entity
for which Employee serves as an officer, director, employee,
consultant or other agent), controlled by, or under common
control with Employee, and (ii) each other entity in which
Employee, directly or indirectly, owns any controlling
interest or of which Employee serves as a general partner.
"Company Project" means any Multifamily Property that
the Company owns, operates or manages as of the date of
Employee's termination of employment with the Company or that
the Company has in any manner taken steps to acquire, develop,
construct, operate, manage or lease (including without
limitation making market surveys of a site, talking to the
owner or his agent concerning the purchase or joint venture of
a site, optioning or contracting to buy a site or discussions
with the owner or his agent regarding managing or leasing a
property) during the twelve (12) month period immediately
preceding Employee's termination of employment with the
Company.
"Multifamily Property" means any real property on
which multifamily residential-use development has been
constructed or is now or hereafter proposed to be constructed
(for example, and not by way of limitation, a property of the
type managed by the Company).
(b) Anti-Pirating of Employees. For a two (2) year period
immediately following the termination of Employee's employment with the Company,
Employee agrees not to hire, directly or indirectly, or entice or participate in
any efforts to entice to leave the Company's employ, any person who was or is an
employee of the Company at any time during the twelve (12)month period
immediately preceding the termination date of Employee's employment with the
Company.
(c) Anti-Pirating of Company Projects. For a period of one (1)
year immediately following the termination of Employee's employment with the
Company, Employee agrees not to engage in any manner, whether as an officer,
employee, owner, partner, stockholder, director, consultant or otherwise -
directly or indirectly - in any business which engages or attempts to engage,
directly or indirectly, in the acquisition, development, construction,
operation, management or leasing of any Company Project.
(d) Trade Secrets and Confidential Information. Employee
hereby agrees that Employee will hold in a fiduciary capacity for the benefit of
the Company, and shall not directly or indirectly use or disclose any Trade
Secret, as defined hereinafter, that Employee may have acquired during the term
of Employee's employment by the Company for so long as such
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information remains a Trade Secret. The term "Trade Secret" as used in this
Agreement shall mean information including, but not limited to, technical or
nontechnical data, a formula, a pattern, a compilation, a program, a device, a
method, a technique, a drawing, a process, financial data, financial plans,
product plans, or a list of actual or potential customers or suppliers which:
derives economic value, actual or potential from not being
generally known to, and not being readily ascertainable by
proper means by, other persons who can obtain economic value
from its disclosure or use; and is the subject of reasonable
efforts by the Company to maintain its secrecy.
In addition to the foregoing and not in limitation thereof, Employee
agrees that during the period of Employee's employment by the Company and for a
period of one (1) year thereafter, Employee will hold in a fiduciary capacity
for the benefit of the Company and shall not directly or indirectly use or
disclose, any Confidential or Proprietary Information, as defined hereinafter,
that Employee may have acquired (whether or not developed or compiled by
Employee and whether or not Employee was authorized to have access to such
Information) during the term of, in the course of or as a result of Employee's
employment by the Company. The term "Confidential or Proprietary Information" as
used in this Agreement means any secret, confidential or proprietary information
of the Company not otherwise included in the definition of "Trade Secret" above.
The term "Confidential and Proprietary Information" does not include information
that has become generally available to the public by the act of one who has the
right to disclose such information without violating any right of the Company.
(e) Return of Information. Upon termination of Employee's
employment relationship with the Company, Employee agrees to turn over and
return to the Company all property in Employee's possession which belongs to the
Company and all files, information and data received, held or developed by
Employee while employed by the Company.
(f) Reasonable and Necessary Restrictions. Employee
acknowledges that the restrictions, prohibitions and other provisions of this
paragraph 5, including without limitation the various periods of restrictions
set forth in paragraphs 5(b), 5(c) and 5(d), are reasonable, fair and equitable
in scope, terms and duration, are necessary to protect the legitimate business
interests of the Company, and are a material inducement to the Company to enter
into this Agreement. Employee covenants that Employee will not challenge the
enforceability of this Agreement nor will Employee raise any equitable defense
to its enforcement.
(g) Specific Performance. Employee acknowledges that the
obligations undertaken by Employee pursuant to this paragraph 5 are unique and
that the Company likely will have no adequate remedy at law if Employee shall
fail to perform any of Employee's obligations hereunder, and Employee therefore
confirms that the Company's right to specific performance of the terms of this
paragraph 5 is essential to protect the rights and interests of the Company.
Accordingly, in addition to any other remedies that the Company may have at law
or in equity, the Company shall have the right to have all obligations,
covenants, agreements and other provisions of this paragraph 5 specifically
performed by Employee, and the Company shall have the right to obtain
preliminary and permanent injunctive relief to secure specific performance and
to prevent a
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breach or contemplated breach of this paragraph 5 by Employee, and Employee
submits to the jurisdiction of the courts of the State of North Carolina for
this purpose.
(h) Operations of Affiliates. Employee agrees that Employee
will refrain from (i) authorizing any Affiliates to perform or (ii) assisting in
any manner any Affiliate in performing any activities that would be prohibited
by the terms of this paragraph 5 if they were performed by Employee.
(i) Survival. The provisions of this paragraph 5 shall survive
the termination of this Agreement regardless of the date, cause or manner of
such termination.
6. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to be given when delivered
personally or mailed first class, registered or certified mail, postage prepaid,
in either case, addressed as follows:
o If to Employee:
at Employee's last know address on file with the Company
o If to the Company:
Summit Management Company
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
7. Non-waiver. No Waiver by a party hereto of any breach by another
party to this Agreement of any provision hereof, shall be deemed to be a waiver
of any later or other breach thereof or as a waiver of any such other provisions
of this Agreement.
8. Severability. Should any provision of this Agreement be declared
invalid or unenforceable as a matter of law, such invalidity or unenforceability
shall not affect or impair the validity or enforceability of any other provision
of this Agreement or the remainder of this Agreement as a whole.
9. Entire Agreement. This Agreement constitutes the entire Agreement
and sets forth all the terms of the understanding between the parties hereto
with respect to the subject matter hereof, and any amendment, change or
modification in any provision of this Agreement or any waiver of this Agreement
shall be in writing signed by the parties hereto.
10. Section Headings. The section headings inserted in this Agreement
are for convenience of reference only and shall not be deemed to have any legal
effect whatsoever on the interpretation of this Agreement.
11. Applicable Law. This Agreement shall be governed, enforced and
construed according to the laws of the State of North Carolina.
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12. Assignment. The benefits hereunder with respect to the rights of
the Company may be assigned by the Company to any other corporation acquiring
all or substantially all of the assets of the Company or to any other
corporation into which the Company may be liquidated or with which the Company
may be merged or consolidated. The rights of the Company under this Agreement,
as well as the obligations and the liabilities of the Company hereunder, shall
inure to and be binding upon any successors-in-interest or transferees of the
business or assets of the Company, and Employee agrees on demand to execute any
and all documents in connection therewith. Employee may not assign this
Agreement or any rights or benefits hereunder, whether for collateral purposes
or otherwise.
13. Freedom of the Company to Act. No provision of this Agreement shall
be deemed to restrict the absolute right of the Company, at any time, to sell or
dispose of all or any part of its assets, or reconstitute the same into any one
or more subsidiary corporations, or to merge, consolidate, sell or to otherwise
dispose of said subsidiary corporation or any of the assets thereof.
14. Execution. This Agreement is executed in triplicate originals, one
of which is being retained by Employee and two of which by the Company, and all
three of which shall be deemed an original hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
SUMMIT MANAGEMENT COMPANY
By: /s/ Xxxxxxx X. Xxx
--------------------------------------
Xxxxxxx X. Xxx
President
"EMPLOYEE"
(SEAL) By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
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