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EXHIBIT 10.19
AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into on June 11, 1999 (the
"Effective Date"), by and between Xxxxxx X. Xxxxxxx ("Employee") and Crescent
Real Estate Equities Company ("CEI"), Crescent Real Estate Equities Limited
Partnership ("CREELP") and Crescent Real Estate Equities, Ltd. ("CREE, Ltd." and
together with CEI, CREELP, and each of their respective subsidiary entities and
other direct or indirect affiliates, the "Employer Group").
WHEREAS, Employee presently serves as President and Chief Executive Officer of
CEI, CREE, Ltd. and certain of the other entities constituting the Employer
Group;
WHEREAS, the parties wish to resolve all outstanding claims and disputes between
them in an amicable manner;
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements set forth in this Agreement, the sufficiency of which the parties
acknowledge, it is agreed as follows:
1. Employee hereby resigns from all directorships and offices of whatever
nature held by Employee with any member of the Employer Group, with such
resignation to be effective as of the Effective Date. Employee shall also
tender a full and unconditional resignation in writing from all
directorships and offices of whatever nature held by Employee at Crescent
Operating, Inc. and each of its respective subsidiary entities and other
direct or indirect affiliates by the close of business of the business day
following the Effective Date.
2. In consideration for Employee's promises in this Agreement, the Employer
Group agrees to continue Employee's current salary of $500,000 and current
benefits for the period ending June 30, 2000, with such salary and benefits
to be paid and/or provided in the same manner and on the same basis as in
effect on the Effective Date hereof. Employee shall have no obligation to
mitigate the amounts payable to Employee under this Agreement, nor shall
the amount of any payment hereunder be reduced by any compensation earned
by Employee as a result of his performance of services for a third party.
The Employer Group also agrees to reimburse all reasonable business
expenses incurred by Employee on behalf of the Employer Group prior to the
date of his resignation, in accordance with the Employer Group's policies
and procedures regarding executive expense reimbursement. Payments
hereunder shall be subject to such payroll tax and other withholding as is
required by law. Except as set forth specifically in this Section or as set
forth in the document(s) effecting the accelerated vesting of the New
Vested Options (defined in Section 3 below), Employee will not be entitled
to any other payment whatsoever for his promises in this Agreement.
3. Employee and CEI and CREE, Ltd. acknowledge that, contemporaneously with
this Agreement, the Executive Compensation Committee of CEI, acting on
behalf of CEI and CREELP, has accelerated the vesting of certain unvested
stock and unit options held by Employee (the "New Vested Options"),
pursuant to the CREELP First Amended and Restated Unit Option Agreement
attached hereto as Exhibit A and to the CEI First Amended and Restated
Stock Option Agreement attached hereto as Exhibit B. The Employer Group
agrees to use all reasonable efforts to ensure that the New Vested Options,
all other options that are vested as of the Effective Date, and all
securities as to which those options may be exercised by Employee will
continue to be registered under the Securities Act of 1933 and that all
existing rights of Employee pursuant to the relevant stock or unit option
plans, stock or unit option agreements, partnership agreements and other
arrangements to exercise those options (including without limitation the
right to exchange partnership units for two shares of the common stock of
CEI) will be preserved. Employee represents and acknowledges to the
Employer Group that his interest in the stock options and unit options
previously issued to him by certain members of the Employer Group are
either his separate property or subject to the sole management, control and
disposition of Employee.
4. The Employer Group shall provide Employee an insurance and indemnification
policy (including any fiduciary liability policy) that provides coverage
with respect to any claims made during the six (6) year period following
the Effective Date that is substantially similar to the Employer Group's
existing policies or, if substantially equivalent insurance coverage is
unavailable, the best coverage reasonably available.
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5. As a further condition to the agreements contained herein, neither Employee
nor any person acting on Employee's behalf will, and neither Employee or
such other person will assist or encourage others (including those
providing financing to Employee for any purpose) to, directly or
indirectly, for a period of one (1) year from the date of this Agreement
(i) induce or attempt to persuade any persons with whom any member of the
Employer Group is now doing business, or has at any time in the past done
business, to curtail, cancel or otherwise terminate their business with any
member of the Employer Group, provided, however, that commencing on the
Effective Date, Employee may do business with investment banking firms,
real estate companies, and any other business which now does, or at any
time in the past has done, business with any member of the Employer Group,
where the Employee's conduct of such business does not otherwise violate
this Section 5(i) or the Noncompetition Agreement referenced in paragraph
16, or (ii) without the express prior written approval of the relevant
member, employ, offer to employ or permit to post for any position of
employment any employee of any member of the Employer Group or otherwise
interfere with the employment by any member of the Employer Group of any
individual who is at that time an employee of such member. Notwithstanding
the foregoing, nothing in this Section is to be construed as restricting
Employee from engaging in any business or pursuing any opportunity which
Employee was free to engage in or pursue pursuant to the Non-Competition
Agreement.
6. Employee agrees that the payments and other benefits referenced in Section
2 and the modifications to the unvested stock and unit options contemplated
by Section 3 are in full, final and complete settlement of all claims
Employee may have against any member of the Employer Group or any of such
member's past and present affiliates, officers, directors, owners,
employees, agents, successors and assigns, and the Employer Group agrees
that Employee's promises in this Agreement are in full, final and complete
settlement of all claims Employer Group may have against Employee, his
heirs and assigns. Nothing in this Agreement shall be construed as an
admission of liability by any member of the Employer Group or any of such
member's past and present affiliates, officers, directors, owners,
employees or agents, or by Employee.
7. (a) Employee covenants not to xxx, and fully and forever releases and
discharges each member of Employer Group and each of such member's past and
present affiliates, directors, officers, owners, employees and agents, as
well as each of such member's successors and assigns (collectively, the
"Crescent Releasees") from any and all claims, liabilities, damages,
demands, and causes of action or liabilities of any nature or kind, whether
now known or unknown, arising out of or in any way connected with
Employee's employment or other relationship with any member of Employer
Group or the termination of that employment or other relationship. Each
member of the Employer Group covenants not to xxx, and fully and forever
releases Employee, his agents, heirs and assigns (collectively, the
"Xxxxxxx Releasees"), from any and all claims, liabilities, damages,
demands, and causes of action or liabilities of any nature or kind, whether
now known or unknown, arising out of or in any way connected with
Employee's employment or other relationship with any member of the Employer
Group or the termination of that employment or other relationship.
(b) Nothing in this Agreement shall be construed to prohibit either party
from taking action to enforce this Agreement or the other agreements or
arrangements that survive in accordance with Section 16. In the event such
action is taken, the prevailing party shall be entitled to payment by the
non-prevailing party of his or its costs and expenses, including without
limitation reasonable attorney's fees, in additional to any other relief to
which he or it may be entitled.
(c) Nothing in this Agreement shall preclude the Crescent Releasees or the
Xxxxxxx Releasees, or any one or more of them, from raising counterclaims
and defenses in any suit brought against such Releasee by, in the case of a
suit against a Crescent Releasee, a Xxxxxxx Releasee, or, in the case of a
suit brought against a Xxxxxxx Releasee, a Crescent Releasee.
8. (a) Employee recognizes the proprietary interest of the Employer Group and
their affiliates in any Confidential Information (as hereinafter defined)
of the Employer Group and their affiliates. Employee acknowledges and
agrees that any and all Confidential Information learned by Employee during
the course of his engagement by Employer or otherwise, whether developed by
Employee alone or in conjunction with others or otherwise, is the property
of the Employer Group and their affiliates. Employee further acknowledges
and understands that his disclosure of any Confidential Information and/or
proprietary information will result in irreparable injury and
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damage to the Employer Group and their affiliates. As used herein,
"Confidential Information" means all confidential and proprietary
information of the Employer Group and their affiliates, including without
limitation information derived from reports, investigations, experiments,
research, drawings, designs, plans, proposals, codes, marketing and sales
programs, client lists, client mailing lists, financial projections, cost
summaries, pricing formulas, and all other concepts, ideas, materials, or
information prepared or performed for or by the Employer Group or their
affiliates. "Confidential Information" also includes information related to
the business, products or sales of the Employer Group or their affiliates,
or any of their respective customers, other than information that is
otherwise publicly available without breach by any person of any duty to
the Employer Group or their affiliates.
(b) Employee acknowledges and agrees that the Employer Group and their
affiliates are entitled to prevent the disclosure of Confidential
Information. As a portion of the consideration for the compensation being
paid to Employee by Employer Group, Employee agrees at all times to hold in
strict confidence and not to disclose or allow to be disclosed to any
person, firm or corporation, other than to persons engaged by the Employer
Group and their affiliates to further the business of the Employer Group
and their affiliates, and not to use, the Confidential Information without
the prior written consent of the Employer Group.
(c) Employee agrees to provide representatives of the Employer Group
reasonable access to the files and other information containing
Confidential Information. Employee will return to the Employer Group all
originals and copies of any material containing Confidential Information
within 14 days following written request. Employee will also return to the
Employer Group within 14 days following a written request any other items
in his possession, custody or control that are the property of a member of
the Employer Group.
(d) Notwithstanding the foregoing, (i) Employee may use for his own benefit
or the benefit of others any Confidential Information which he can show he
developed outside the course and scope of his employment with the Employer
Group; and (ii) Employee may disclose Confidential Information when
required to do so by compulsory legal process, provided that Employee
promptly upon receiving notice of such process shall notify the Employer
Group and shall cooperate to the fullest extent in any lawful efforts of
the Employer Group to protect the Confidential Information from compulsory
disclosure.
9. Employee hereby acknowledges that he is aware of the restrictions imposed
by federal and state securities laws on a person possessing material
nonpublic information about a company. In this regard, Employee hereby
agrees that while he is in possession of material nonpublic information
with respect to the Employer Group, he will not purchase or sell any
securities of CEI or any other member of the Employer Group, or communicate
such information to any third party, in violation of any such laws.
10. Employee agrees that he will not encourage or assist any of the Employer
Group's employees to litigate claims or file administrative charges against
any member of the Employer Group or any of such member's past or present
affiliates, officers, directors, owners, employees and agents, unless
required to provide testimony or documents pursuant to a lawful subpoena or
other compulsory legal process.
11. Each of Employee and the Employer Group agrees that money damages would not
be a sufficient remedy for any breach of any provision of this Agreement by
the other, and that in addition to all other remedies which the aggrieved
party may have at law or in equity, including without limitation in the
case of a breach by Employee the cessation of payments of salary and
benefits pursuant to Section 2 and the forfeiture of Employee's rights in
the New Vested Options, such party will be entitled, without the
requirement of posting a bond or other security, to specific performance
and injunctive or other equitable relief as a remedy for any such breach.
No failure or delay by either of Employee or Employer Group in exercising
any right, power or privilege hereunder will operate as a waiver thereof,
nor will any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any right, power or privilege
hereunder.
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12. Except as otherwise provided in Section 14, Employee and Employer Group
agree that he and they will treat the existence and terms of this Agreement
as confidential and will not discuss the Agreement or the Press Release
referenced in Section 14 hereof with anyone other than: (i) his or their
counsel, accountants, or tax advisors as necessary to secure their
professional advice, (ii) as may be required by law, and (iii) in
Employee's case, his spouse.
13. Employee agrees to refrain from making any unfavorable comments, in writing
or orally, about any member of Employer Group, or their operations,
policies, or procedures, or about the Releasees. Each member of Employer
Group agrees to refrain from making any unfavorable comments, in writing or
orally, about Employee or his job performance while in the service of the
Employer Group.
14. The Employer Group in its sole discretion shall issue a Press Release
concerning Employee's resignation from Employer Group and Employee
expressly convenants and agrees that neither the issuance nor the contents
of nor discussions relating to such Press Release (subject to Section 13)
shall constitute a violation of this Agreement or create a right of action
against any member of the Employer Group.
15. This Agreement shall be binding on the Employer Group and on Employee and
upon their respective heirs, representatives, successors and assigns, and
shall run to the benefit of the Releasees and each of them and to their
respective heirs, representatives, successors and assigns. The undersigned
members of the Employer Group shall be jointly and severally responsible
for any breach of this Agreement by any other member of the Employer Group.
16. This Agreement sets forth the entire agreement between Employee and the
members of the Employer Group, and fully supersedes and terminates any and
all prior agreements or understandings between them regarding its subject
matter, including without limitation the Employment Agreement dated April
15, 1994, between Rainwater, Inc. and Employee, as amended; provided,
however, that nothing in this Agreement is intended to or shall be
construed to modify, impair or terminate any obligation of Employee
pursuant to that certain Noncompetition Agreement entered into between
Employee and Rainwater, Inc., a copy of which is attached hereto as Exhibit
D, or any obligation of Employee or any member of the Employer Group
pursuant to that certain Indemnification Agreement covering Employee, a
copy of which is attached hereto as Exhibit E, or to deprive Employee of
any indemnification rights he otherwise would have pursuant to statute or
the Employer Group's governing documents. This Agreement may only be
modified by written agreement signed by both parties.
17. Each of the undersigned members of the Employer Group and Employee agree
that in the event any provision of this Agreement is deemed to be invalid
or unenforceable by any court or administrative agency of competent
jurisdiction, or in the event that any provision cannot be modified so as
to be valid and enforceable, then that provision shall be deemed severed
from the Agreement and the remainder of the Agreement shall remain in full
force and effect.
18. Employee and the Employer Group mutually agree to cooperate fully with each
other and to execute and deliver such other instruments, documents and
agreements, and to take such other actions reasonably required by any party
to better evidence and reflect the transactions contemplated hereby and to
carry into effect the interests and purposes of this Agreement.
19. Employer Group will reimburse Employee for all reasonable and necessary out
of pocket travel and other expenses incurred by Employee in negotiating the
terms of this Agreement.
20. This Agreement in all respects shall be interpreted and entered under the
laws of the State of Texas. The language of all parts of this Agreement in
all cases shall be construed as a whole, according to its fair meaning, and
not strictly for or against any of the parties.
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PLEASE READ CAREFULLY. THIS
AGREEMENT AND GENERAL RELEASE INCLUDES A
RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.
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Xxxxxx X. Xxxxxxx
CRESCENT REAL ESTATE EQUITIES COMPANY
By:
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Name:
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Title:
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CRESCENT REAL ESTATE EQUITIES LIMITED
PARTNERSHIP
By: CRESCENT REAL ESTATE EQUITIES, LTD., its
general partner
By:
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Name:
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Title:
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CRESCENT REAL ESTATE EQUITIES, LTD.
By:
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Name:
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Title:
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