AGREEMENT
AGREEMENT, dated as of July 23, 2006, between WINTHROP REALTY TRUST
(formerly First Union Real Estate Equity and Mortgage Investments), an Ohio
business trust (the "Company") and XXXXXXX X.XXXXXX ("Xxxxxx"), an individual.
RECITALS
WHEREAS, pursuant to that certain Exclusivity Services Agreement, dated
December 31, 2003, between the Company and Xxxxxx (the "Exclusivity Agreement"),
Xxxxxx agreed to offer to the Company all Business Opportunities offered to
Xxxxxx during the term of the Agreement;
WHEREAS, the Exclusivity Agreement was amended in certain respects by that
certain Amendment No. 1 to the Exclusivity Agreement, dated October 27, 2005,
which provided, among other things, that "Business Opportunity" shall mean an
investment in real property or assets related thereto other than certain
specified investments;
WHEREAS, pursuant to that certain Assignment made as of November 7, 2005,
(the "Exclusivity Assignment"), the Company assigned to Xxxxxxx Realty Trust,
Inc. ("Xxxxxxx") its rights under the Exclusivity Agreement solely with respect
to "Net Lease Assets," as that term is defined in the Acquisition Agreement
dated as of November 7, 2005 by and between the Company and Xxxxxxx (the
"Acquisition Agreement");
WHEREAS, Xxxxxxx and Lexington Corporate Properties Trust, a Maryland real
estate investment trust ("Lexington") are, simultaneously herewith, entering
into that certain Agreement and Plan of Merger, dated of even date herewith (the
"Merger Agreement"), pursuant to which Xxxxxxx shall be merged with and into
Lexington, among other things (the "Merger");
WHEREAS, it is a condition to the consummation of the Merger that, at the
effective time of the Merger (the "Effective Time"), Xxxxxxx assign to
Lexington, and Lexington assume all of Xxxxxxx'x rights and obligations under
the Acquisition Agreement, which assignment and assumption by Lexington shall
include Xxxxxxx'x rights and obligations under the Exclusivity Assignment, and
which assignment and assumption is to be evidenced by that certain proposed form
of Amendment to Acquisition Agreement and Assignment and Assumption attached as
Annex __ to the Merger Agreement (the "Amendment, Assignment and Assumption"), a
copy of which is attached hereto as Exhibit A;
WHEREAS, it is further a condition to the consummation of the Merger that
upon the Effective Time, Xxxxxx become an employee of Lexington pursuant to the
terms of that certain proposed form of Employment Agreement by and between
Lexington and Xxxxxx attached as Annex __ to the Merger Agreement ("Employment
Agreement"), a copy of which attached hereto as Exhibit B;
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WHEREAS, Lexington and Xxxxxx have requested that the Company consent to
Xxxxxx'x entering into of the Employment Agreement upon the consummation of the
Merger;
NOW THEREFORE, in consideration of the foregoing and the mutual provisions
and agreements contained herein, the parties hereto agree as follows:
1. Capitalized terms used herein and not otherwise defined herein
shall have the respective meanings set forth in the Amendment, Assignment and
Assumption.
2. The parties acknowledge and agree that certain provisions have
been included in the Employment Agreement and the Amendment, Assignment and
Assumption for the direct or indirect benefit of the Company or in furtherance
of the rights and obligations of the parties to the Exclusivity Agreement, as
amended, including but not limited to the following:
(i) The Employment Agreement provides that Xxxxxx may
terminate his employment thereunder with Good Reason (as defined therein)
in the event that Lexington acquires or makes an Investment in Real
Property (as defined therein) other than a Net Lease Asset (except for
certain Investments in Real Property specified therein) without prior
written notice to, and the participation or consent of the Company (such
event to be referred to hereinafter as a "Nonconforming Investment
Event"), provided that Xxxxxx first gives Lexington written notice of his
intention to terminate and of the grounds for such termination within 90
days of such event (the "Termination Notice").
(ii) The Amendment, Assignment and Assumption provides that if
Xxxxxx shall have terminated the Employment Agreement for Good Reason, the
"Reversion Date" under the amended Acquisition Agreement shall be the date
on which Xxxxxx ceases to be a trustee of Lexington and that, upon the
occurrence of the Reversion Date, the Exclusivity Assignment shall
immediately terminate without any further action on the part of either
party and all rights assigned to Xxxxxxx pursuant to the Acquisition
Agreement (and further assigned to Lexington as of the Effective Time
under the Amendment, Assignment and Assumption) and any assignment
delivered in connection therewith (including as a result of the assignment
of the Exclusivity Assignment to Lexington as of the Effective Time) shall
revert to the Company.
3. In consideration of the covenants and agreements set forth in
Section 4 hereof, the Company hereby consents to Xxxxxx entering into the
Employment Agreement at such time as the Merger is consummated.
4. Xxxxxx hereby covenants and agrees that:
(i) in the event that Xxxxxx has the right to terminate his
employment under the Employment Agreement for Good Reason due to the
occurrence of a Nonconforming Investment Event, Xxxxxx shall promptly (1)
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resign and terminate his employment for Good Reason under the Employment
Agreement, and shall take all steps necessary to effectuate such
termination, including providing promptly to Lexington a Termination
Notice specifying the Nonconforming Investment Event as the grounds for
such termination, provided that in no event shall Xxxxxx provide such
Termination Notice to Lexington later than 90 days after the occurrence of
a Nonconforming Investment Event, (2) resign as a trustee of Lexington,
and (3) resign all of his positions with Lexington and its affiliated
entities; provided, that if Xxxxxx has received the consent of a majority
of the independent trustees of the Board of Trustees of the Company with
respect to a specific Nonconforming Investment Event, which consent may be
granted or withheld in such trustee's sole discretion, Xxxxxx shall not be
obligated to take the actions provided in this subparagraph (i) with
respect to said Nonconforming Investment Event.
(ii) he will not, without the prior written consent from a
majority of the independent trustees of the Board of Trustees of the
Company, which consent may be granted or withheld in such trustee's sole
discretion, consent to any modification or amendment to the Employment
Agreement from and after the date hereof that would have the effect of
modifying the provisions thereof which directly or indirectly benefit the
Company, including but not limited to an amendment that would: (1)
adversely affect his ability to serve as the Chief Executive Officer and
as a trustee of the Company, (2) modify Section 5(b)(ii) of the Employment
Agreement or the procedure for termination for Good Reason, or (3) extend
the time period for which the restrictive covenants in Section 7(a) of the
Employment Agreement are applicable.
5. In the event that any party threatens to take any action prohibited by
this Agreement, the parties agree that there may not be an adequate remedy at
law. Accordingly, in such an event, a party may seek and obtain preliminary and
permanent injunctive relief (without the necessity of posting any bond or
undertaking). Such remedies shall, however, be cumulative and not exclusive and
shall be in addition to any other remedies which any party may have under this
Agreement or otherwise.
6. The terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective successors and assigns of the parties
hereto. Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the parties hereto or their respective successors and
assigns any rights, remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided in this Agreement.
7. This Agreement shall be governed by the laws of the State of New York,
without regard to the conflicts of law provisions thereof.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date and year first above written.
WINTHROP REALTY TRUST
By:
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Xxxxx Xxxxxxxxx
President
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Xxxxxxx X. Xxxxxx
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