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EMPLOYMENT AGREEMENT
BETWEEN CARDINAL REALTY SERVICES, INC.
AND
XXXX X. XXXXX
128
TABLE OF CONTENTS
Page
1. Employment................................................................1
2. Term and Positions........................................................1
3. Compensation..............................................................2
4. Insurance and Other Benefits..............................................8
5. Payment in the Event of Death or Permanent Disability.....................8
6. Termination and Further Compensation......................................9
7. Reimbursement............................................................11
8. Covenants and Confidential Information...................................11
9. Withholding Taxes........................................................12
10. No Conflicting Agreement.................................................13
11. Severable Provisions.....................................................13
12. Binding Agreement........................................................13
13. Arbitration..............................................................13
14. Notices..................................................................13
15. Waiver...................................................................13
16. Miscellaneous............................................................14
17. Governing Law............................................................14
18. Captions and Section Headings............................................14
19. Miscellaneous............................................................14
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of the 15th
day of April, 1996, between Cardinal Realty Services, Inc., an Ohio corporation
("Employer"), and Xxxx X. Xxxxx ("Employee").
WITNESSETH:
WHEREAS, Employer and Employee desire to enter into this Agreement to
assure Employer of the services of Employee, and Employee's employment for the
term set forth herein, and to set forth the rights and duties of the parties
hereto.
NOW, THEREFORE, in consideration of the mutual promises herein
contained, the parties agree as follows:
1. Employment.
(a) Employer hereby employs Employee, and Employee hereby
accepts such employment, upon the terms and conditions hereinafter set
forth.
(b) During the term of this Agreement, or any renewal or
extension hereof (for purposes hereof, all references herein to the
term of this Agreement shall be deemed to include references to the
period of renewal or extension hereof, if any), Employee shall devote
his full time to his employment and perform with reasonable diligence
such duties as are customarily performed by the Senior Vice President
and Manager of Advisory Services or similar senior executive officer of
a company having the size and structure of Employer and its
subsidiaries, together with such other duties as may be reasonably
requested from time to time by the Board of Directors of Employer (the
"Board"), which duties shall be consistent with the further covenants
set forth in Section 2 of this Agreement.
(c) Employee shall not, without the prior written consent of
Employer, directly or indirectly, during the term of this Employment
Agreement, other than in the performance of duties naturally inherent
in the businesses of Employer or any subsidiary of Employer and in
furtherance thereof, render services of a business, professional or
commercial nature to any other person or firm, for compensation. For
purposes of this Agreement, all references herein to subsidiaries and
affiliates of Employer shall be deemed to include subsidiaries and
affiliates now or hereafter existing.
2. Term and Positions.
(a) Subject to the provisions for termination as hereinafter
provided, the term of this Agreement shall begin on April 15, 1996 and
shall continue through April 14, 1997 (the "Original Term"). The
Original Term may be extended for additional terms of one year each
(each, a "Renewal Term") upon the mutual agreement of Employer and
Employee.
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(b) Employee shall, without any compensation in addition to
that which is specifically provided in this Agreement, serve as Senior
Vice President and Manager of Advisory Services of Employer and in such
other offices or positions with any subsidiary or affiliate of Employer
as shall, from time to time, be assigned reasonably by the Board (but
such office or positions shall be consistent with the duties, offices
or positions hereinbefore named). It is agreed that in addition to the
provisions of Section 4(e) of this Agreement and any other obligations
due him hereunder, Employee shall be entitled to the protection of the
applicable indemnification provisions of the Articles of Incorporation
and Code of Regulations of Employer and the corporate or partnership
organizational documents of any such subsidiary or affiliate. Employer
will use all commercially reasonable efforts to maintain its directors
and officers liability insurance for the benefit of, among others,
Employee. For purposes of this Agreement, the term: (i) "affiliate,"
when used with reference to Employer, means any entity which, directly
or indirectly through one or more intermediaries, is controlled by,
under common control with, or which controls, Employer; (ii) "control"
means (A) the power to direct the management and policies of the entity
in question, directly or indirectly, whether through ownership of
voting securities, by contract or otherwise and (B) "controlled" and
"controlling" have meanings correlative to the foregoing; and (iii)
"subsidiary" means, with reference to Employer, any corporation,
general or limited partnership, limited liability company, association
or other business entity (A) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of
the ordinary voting power or more than 50% of the general partners
interests are, at the time any determination is being made, owned,
controlled or held by Employer or (B) that, at the time any
determination is being made, is otherwise controlled, by Employer or
one or more subsidiaries of Employer or by Employer and one or more
subsidiaries of Employer.
3. Compensation.
(a) For all services he may render to Employer (and any
subsidiary or affiliate) during the term of this Agreement, Employer
shall pay to Employee base compensation ("Base Compensation") on the
following terms:
(i) For the Original Term and any Renewal Term, One
Hundred and Twenty-Five Thousand Dollars ($125,000) per annum.
(ii) Base Compensation payable to Employee under this
Section 3(a) shall be payable in equal bi-weekly installments.
(iii) Commencing January 1, 1997, Base Compensation
may be increased each fiscal year upon appropriate action by
the Board. If increased, such increased dollar amount shall
thereafter constitute "Base Compensation" for all purposes
under this Agreement.
(b) Employer shall pay to Employee bonus compensation during
the term of this Agreement as follows:
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(i) For Employer's 1997 fiscal year, and for each
fiscal year thereafter during which this Employment Agreement
remains in effect, Employer will pay to Employee a cash bonus
(the "Cash Bonus") determined on the basis of Employer's
aggregate return on equity ("XXX" as defined in Exhibit "A-1"
attached hereto and incorporated herein) from investments in
real estate (including interests comprised of receivables) as
follows:
Cash Bonus Expressed as
Percentage of Base
XXX Compensation
-------------------------------- --------------------------
up to 5% 0
greater than 5% up to 10% XXX multiplied by 1.0;
plus, if applicable
----
greater than 10% up to 15% XXX exceeding 10%
multiplied by
1.5; plus, if applicable
----
greater than 15% up to 20% XXX exceeding 15%
multiplied by
2.5; plus, if applicable
----
greater than 20% to 25% XXX exceeding 20%
multiplied by
3.0; plus, if applicable
----
greater than 25% XXX exceeding 25%
multiplied by 4.0, but not
to exceed a total of
60% of Base Compensation
(ii) For purposes of determining the Cash Bonus, if any,
payable to Employee, Employee and Employer acknowledge and
agree that (subject to any increase pursuant to Section
3(a)(iii) of this Agreement) Employee's 1996 Base Compensation
will be deemed (solely for purposes of this Section 3(b) to
equal One Hundred Twenty-Five Thousand Dollars ($125,000), and
the maximum Cash Bonus payable to Employee on account of
Employer's 1996 fiscal year equals Seventy-Five Thousand
Dollars ($75,000).
(iii) Employee's Cash Bonus due under subsections (i) and
(ii) above shall be paid within thirty (30) days after XXX is
calculated from the applicable final audited year end income
statements of Employer.
(iv) In addition to the Cash Bonus, for Employer's 1996
fiscal year, and for each fiscal year thereafter during which
this Employment Agreement remains in effect, Employer shall,
and hereby does, grant to Employee a stock bonus ("Stock
Bonus"; and, together with the Cash Bonus, the "Bonus")
payable in shares of Employer's common stock, without par
value (the "Common Stock"), in accordance
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with a Deferred Shares Award Agreement (the "Deferred Shares
Agreement") to be entered into between Employer and Employee
in the form attached hereto as Exhibit A. The dollar amount of
the Stock Bonus will be determined on the same basis as the
Cash Bonus (including the partial-year provision set forth in
Section 5(a), except that the dollar value of the Stock Bonus
as a percentage of Base Compensation will be as follows:
Percentage Increase Dollar Value of Stock
in Employer's XXX Bonus Expressed as Percentage
-------------------- of Base Compensation
-----------------------------
up to 103% 0
greater than 103% up to 105% Equivalent to Percentage
Increase in XXX; plus, if
applicable
greater than 105% up to 110% Additional Percentage
Increase in XXX (above 5%)
multiplied by 2; plus, if
applicable
greater than 110% Additional Percentage
Increase in XXX (above 10%)
multiplied by 3,
but not to exceed 30% of
Base Compensation
(v) The number of shares constituting the Stock Bonus
payable to Employee will be determined by dividing (A) the
dollar value of the Stock Bonus determined in accordance with
the table above by (B) the closing price of Employer's Common
Stock on the Nasdaq National Market System, or if Employer's
Common Stock is not listed or admitted to trading in such
system, the principal securities exchange on which Employer's
Common Stock is listed or admitted to trading on the last
trading date in the period for which the Stock Bonus is
calculated (i.e. December 31, March 31 or the last closing
price for the Common Stock immediately preceding the date
Employee ceases employment with Employer). Any Stock Bonus
which Employee is entitled to receive from Employer shall be
issued on the same date as the Cash Bonus for the same period.
No fractional share shall be payable to Employee in connection
with the Stock Bonus, but Employee will be entitled to a cash
payment equal to the dollar value of any fractional share to
which he would otherwise be entitled under the Stock Bonus, to
be paid together with the payment of the Employee's Cash Bonus
hereunder.
(c) As additional inducement to Employee to enter into this
Agreement, Employer shall issue to The Provident Bank, a state
chartered bank, in its capacity as Trustee under that certain Executive
Deferred Compensation Rabbi Trust Agreement dated as of April 18, 1996
(the "Trust Agreement"), or any successor trustee thereunder
("Trustee"), for
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the benefit of Employee, at no additional consideration or cost to
Employee, up to two thousand five hundred (2,500) shares of the Common
Stock for each share of Common Stock of Employer purchased by Employee
from the date of this Agreement through and including April 15, 1997
(the "Matching Stock"). Any Matching Stock which Trustee is entitled to
receive from Employer shall be issued to Trustee within thirty (30)
days of Employee's purchase of any shares of Common Stock and shall be
subject to all restrictions and limitations imposed by applicable state
and federal securities laws and regulations. Notwithstanding the
provisions of Section 3(b)(iv) of this Agreement, in the event that
Employee shall be entitled to the payment of a Cash Bonus on account of
Employer's 1996 fiscal year, then, in such event, on or before April
30, 1997 Employee may furnish Employer with his written election to
receive shares of Common Stock having a fair market value (such fair
market value to be determined in the same manner as shares of Common
Stock issuable to the Trustee for the benefit of the Employee on
account of Employee's Stock Bonus for Employer's 1996 fiscal year) in
an amount specified by Employee in such written election in lieu of
such Cash Bonus. Employee may make such an election only on account of
Employer's 1996 fiscal year. Any shares of Common Stock so issued to
the Trustee for the benefit of Employee on account of such written
election will, in turn, qualify under this Section 3(c) as shares of
Common Stock purchased by Employee and, accordingly, the Trustee will
be entitled to receive one share of Matching Stock on account of each
share of Common Stock issued to Trustee for the benefit of Employee in
lieu of Employee's Cash Bonus in accordance with the provisions of this
Section 3(c).
(d) Further, Employer shall, and hereby does, grant to
Employee rights to receive additional shares of Common Stock subject to
the terms and conditions of those certain Restricted Shares Agreement
(the "Restricted Shares Agreement") to be entered into between Employer
and Employee, in the form attached hereto as Exhibit B (such Common
Stock to be referred to herein as "Restricted Stock") as follows:
(i) nine thousand (9,000) shares of Restricted Stock,
which shall be issued to Trustee on April 15, 1996 and shall
vest as follows (and as more particularly set forth under the
applicable Restricted Shares Agreement):
A. one-third when the number of issued and
outstanding shares of Employer's Common Stock
multiplied by the closing price of Employer's Common
Stock on the Nasdaq National Market System, or if
Employer's Common Stock is not listed or admitted to
trading in such system, the principal securities
exchange or market on which Employer's Common Stock
is listed or admitted to trading, plus the
liquidation value of all issued and outstanding
preferred stock of Employer ("Market
Capitalization"), exceeds Ninety Million Dollars
($90,000,000) for a continuous period over three (3)
consecutive months;
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B. one-third when the Market Capitalization
exceeds One Hundred Twenty Million Dollars
($120,000,000) for a continuous period three (3)
consecutive months; and
C. one-third when the Market Capitalization
exceeds One Hundred Fifty Million Dollars
($150,000,000) for a continuous three consecutive
month period.
(ii) Notwithstanding the foregoing, the vesting of all
Restricted Stock and Stock Options (as defined hereinbelow)
granted under this Agreement shall be accelerated in the event
of any of the following:
(A) Employer shall merge or be merged or
consolidated with, another corporation and as a
result of such merger or consolidation less than
seventy percent (70%) of the outstanding voting
securities of the surviving or resulting corporation
shall be owned in the aggregate by the former
shareholders of Employer as the same shall have
existed immediately prior to such merger or
consolidation;
(B) Employer shall sell or transfer to one
or more persons, corporations or entities, in a
single transaction or a series of related
transactions, more than one-half of the assets of
Employer unless by an affirmative vote of two-thirds
of the members of the Board, the transaction or
transactions are exempted from the operation of this
provision based on a good faith finding that the
transaction or transactions are not within the
intended scope of this definition for purposes of
this Agreement;
(C) a person, within the meaning of Section
3(a)(9) or Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended and as in effect on
the date hereof the "Exchange Act"), shall become the
beneficial owner (as defined in Rule 13d-3 of the
Exchange Act) of thirty percent (30%) or more of the
outstanding voting securities of Employer; or
(D) any shareholder of Employer shall
nominate a person to the Board, which nominee shall
be elected to the Board without receiving the prior
endorsement of the Board or its Nominating Committee.
(e) Employer shall grant to Employee options to purchase
twelve thousand five hundred (12,500) shares of Employer's Common Stock
("Stock Options") in accordance with, and subject to, the Employer's
Incentive Equity Plan, as amended, and a Non-Qualified Stock Option
Agreement in the form attached hereto as Exhibit C (the "Option Award
Agreement" and, together with the Deferred Shares Agreement and the
Restricted Shares Agreements, the "Award Agreements"). The Stock
Options shall have an exercise price equal to the closing price of
Employer's Common Stock on the Nasdaq National Market
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System on April 14, 1996, one-fifth of which shall vest on the first,
second, third, fourth and fifth anniversaries of the date of such
grant, which grant shall be made pursuant to the Option Award
Agreement.
(f) Employee shall be entitled to participate in any pension
or profit- sharing plan covering highly compensated salaried employees
which the Employer may have in effect or hereafter adopt during the
term of this Employment Agreement.
(g) Employer represents and warrants to Employee that unless
Employee makes an election pursuant to Section 83(b) of the Internal
Revenue Code of 1986, as amended (the "Code"), Employee shall not have
any taxable income solely by reason of the grants described in Sections
3(c), (d) and (e) hereof. Employee understands that he will have
taxable income upon the vesting of Restricted Stock, the exercise of
the Stock Options, the disposition of the rights granted in Sections
3(c), (d) and (e) hereof, or other similar event.
(h) If Employee makes an election pursuant to Section 83(b) of
the Code in connection with Restricted Stock acquired by Employee
pursuant to Section 3(d) hereof, Employer shall make a loan to Employee
in an amount equal to forty-eight percent (48%) (subject to appropriate
adjustment if the combined effective federal, state, and local income
tax rate on compensation income changes in 1996) or any subsequent year
in which income may be recognized) of the compensation income
recognized by Employee for federal income tax purposes in connection
with such election. The loan shall (i) bear interest at a rate per
annum equal to that charged from time to time to Employer under
Employer's senior secured credit facility (which credit facility, as of
the date of this Agreement is provided to Employer by The Provident
Bank) plus two percent (2%), (ii) be secured by a pledge of the
Restricted Stock, (iii) be due upon the earliest of three (3) years
from the date of the loan, the sale of the Restricted Stock (to the
extent of the proceeds of such sale with any remaining balance being
thereafter due as originally scheduled), or one (1) year after
Employee's termination of employment with Employer, and (iv) be
evidenced by a promissory note and a pledge agreement in customary form
reasonably acceptable to Employer and Employee.
(i) With respect to the Restricted Stock, if Employee does not
make an election pursuant to Section 83(b) of the Code as described in
Section 3(g) of this Agreement, and with respect to the Stock Options,
upon each occasion Employee recognizes compensation income, as a result
of the vesting of the Restricted Stock or the exercise of the Stock
Options, Employee may borrow from Employer an amount equal to
forty-eight percent (48%) (subject to adjustment as described in
Section 3(h) of this Agreement) of the compensation income so
recognized by Employee, provided that Employee is still employed by
Employer. The loan shall have the same terms and conditions described
in Section 3(h) of this Agreement.
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4. Insurance and Other Benefits.
(a) Employee shall be entitled to such medical,
hospitalization, health, accident, life and disability insurance and
pension plan benefits and such other similar employment privileges and
benefits as are afforded generally from time to time to other executive
officers of Employer, or subsidiaries of Employer, and in no event
shall Employee be provided benefits at a level less generous than those
benefits provided to any other officer or employee of Employer, or any
subsidiary of Employer. Further, with respect to medical coverage,
Employer shall provide medical coverage for Employee and his dependents
at least equal to the value of coverage afforded Employee on the
effective date of this Agreement if such coverage is available on
commercially reasonable terms.
(b) In connection with the move of Employee's principal
residence to the Columbus, Ohio area, Employer will reimburse Employee
up to Forty-Five Thousand Dollars ($45,000) for typical relocation
expenses, including but not limited to, reasonable temporary living
expenses, including Employee's or Employee's spouse's travel between
Oakton, Virginia and Columbus, Ohio, closing costs on the sale of
Employee's home, and reasonable out-of-pocket costs relating to the
move of furniture, household goods and personal effects from Oakton,
Virginia to Columbus, Ohio. Employee shall bear sole responsibility for
documenting the deductibility of amounts paid pursuant to this
subsection if so required by the Internal Revenue Service, but shall
not be required to provide such documentation to Employer unless
Employer is required to produce same in connection with an audit.
5. Payment in the Event of Death or Permanent Disability.
(a) In the event of Employee's death or Permanent Disability
(as defined hereinbelow) during the term of this Agreement, Employee or
his estate, as the case may be, shall be entitled to receive (i) an
amount equal to (A) the lesser of (x) any remaining Base Compensation
for the Original Term or any then current Renewal Term or (y) one year
of Base Compensation reduced by (B) any and all payments made to
Employee pursuant to any disability insurance policy maintained by
Employer for Employee's benefit pursuant to Section 4(a) of this
Agreement or otherwise (the "Disability Policy"), (ii) a pro rata
portion of the Bonus, if any, applicable to the fiscal year in which
such death or Permanent Disability occurs, as such bonuses are
determined under Section 3(b) of this Agreement, and (iii) any shares
of Restricted Stock and Stock Options that have vested in accordance
with the provisions of the Award Agreements. Such pro rata portion of
the Bonus shall be determined by a multiplying a fraction (the
numerator of which shall be the number of days in the applicable fiscal
year elapsed prior to the date of death or Permanent Disability, as the
case may be, and the denominator of which shall be three hundred
sixty-five (365)) by the amount of the Bonus that would have been
payable, if any, pursuant to such Section 3(b), if Employee had
remained employed under this Agreement for the entire applicable fiscal
year.
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(b) Upon death or Permanent Disability of Employee, the Bonus,
if any, shall be paid when and as provided in Section 3(b) of this
Agreement. The other compensation to be paid pursuant to this Section 5
shall be paid, at the election of Employee or Employee's designated
beneficiary (who shall be his wife, unless he gives Employer written
notice of a different designation), either (i) in two (2) equal annual
installments paid within the two (2) year period beginning on the date
of such death or Permanent Disability, as the case may be, or (ii) in
one (1) lump sum paid within ninety (90) days after the date of such
death or Permanent Disability, as the case may be.
(c) Employee shall be entitled to no further compensation or
other benefits under this Agreement, except as to that portion of any
benefits accrued and earned by him hereunder up to and including the
date of such death or Permanent Disability.
(d) For purposes of this Section 5, Employee's Permanent
Disability shall be deemed to occur on the date after the first to
occur of (i) ninety (90) consecutive days, or (ii) one hundred eighty
(180) days cumulatively in any twelve (12) month period, of Employee's
inability to provide the services required hereunder of him due to
sickness or injury ("Permanent Disability").
6. Termination and Further Compensation.
(a) The employment of Employee under this Agreement, and the
term hereof, subject to Employee's rights set forth elsewhere herein,
may be terminated by Employer:
(i) on death or Permanent Disability of Employee, or
(ii) for cause at any time by action of the Board.
For purposes hereof, the term "cause" shall mean:
A. an intentional act of fraud,
embezzlement, theft or any other material violation
of law in connection with Employee's duties or in the
course of his employment with Employer;
B. intentional wrongful damage to material
assets of Employer;
C. intentional wrongful disclosure of
material confidential information of Employer;
D. intentional wrongful engagement in any
competitive activity which would constitute a
material breach of the duty of loyalty; or
E. breach of any material term of this
Agreement.
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No act, or failure, to act, on the part of Employee shall be
deemed "intentional", or provide the basis for termination for
cause, if it was due primarily to an error in judgment or
negligence without bad faith or reckless disregard, but shall
be deemed "intentional" only if done, or omitted to be done,
by Employee not in good faith and without reasonable belief
that his action or omission was in or not opposed to the best
interest of Employer. Failure to meet performance standards or
objectives of Employer shall not constitute cause for purposes
hereof. Further, in the event Employer terminates Employee for
"cause", Employer shall give Employee written notice as to the
specific circumstances giving rise to its decision to
terminate Employee for cause ("Notice"), and, Employee shall
be given the opportunity to respond, with counsel, to
Employer's decision and Employer's articulated circumstances,
such responses shall be before the Board of Directors of
Employer and shall take place within fourteen (14) days of
Employer's Notice. Any termination by reason of the foregoing
shall not be in limitation of any other right or remedy
Employer may have under this Agreement or otherwise. On any
termination of this Agreement, Employee shall be deemed to
have resigned from all offices and directorships held by
Employee in Employer and any subsidiaries and affiliates of
Employer.
(b) In the event of termination of this Agreement for any of
the reasons set forth in Section 6(a)(ii) hereof, Employee shall be
entitled to no further compensation or other benefits under this
Agreement, except as to (i) that portion of any unpaid Base
Compensation reduced by any and all payments made, or to be made, to
Employee pursuant to the Disability Policy and other benefits accrued
and earned by him hereunder up to and including the effective date of
such termination; and (ii) any of his shares of Restricted Stock and
Stock Options that have vested in accordance with the provisions of
Section 3(c) of this Agreement.
(c) In the event that Employee's employment is terminated
without cause during the Original Term of this Agreement or in the
event that the Original Term of this Agreement shall have expired and
shall not have been renewed and Employee thereupon ceases to be
employed by Employer, Employee shall be entitled to receive: (i) an
amount equal to his Base Compensation, and any other benefits due
Employee under Section 4 of this Agreement, for the nine (9) month
period immediately following such termination; (ii) the Bonus, if any,
applicable to the fiscal year in which such cessation of employment
occurs, as such Bonus is determined under Section 3(b) of this
Agreement but on a prorated basis calculated in the manner contemplated
by Section 5(a) of this Agreement; and (iii) all of his shares of
Restricted Stock awarded pursuant to Section 3(d)(i) of this Agreement
(but not, however, any shares of Restricted Stock awarded pursuant to
Section 3(d)(i) of this Agreement which have not theretofore vested)
and Stock Options immediately fully vested, and otherwise free of any
forfeiture provisions or other restrictions imposed under the Award
Agreements except for any restrictions or limitations imposed by
applicable state and federal securities laws and regulations. In the
event that Employee's employment is terminated without cause during a
Renewal Term, Employee will be entitled to receive all of the
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compensation and benefits provided for in the immediately preceding
sentence. Upon any such termination by Employer, other than for
"cause", Employee's obligations to Employer hereunder shall terminate.
7. Reimbursement. Employer shall reimburse Employee or provide him with
an expense allowance during the term of this Agreement, for travel,
entertainment and other expenses reasonably and necessarily incurred by Employee
in performing services hereunder or, generally, the promotion of Employer's
business. Employee shall furnish such documentation with respect to
reimbursement to be paid under this Section 7 as Employer shall reasonably
request.
8. Covenants and Confidential Information.
(a) Employee acknowledges Employer's reliance and expectation
of Employee's continued commitment of performance of his duties and
responsibilities during the term of this Agreement. In light of such
reliance and expectation on the part of Employer, Employee agrees that
during the period beginning on the effective date of this Agreement and
ending eighteen (18) months after the termination of Employee's
employment for cause or Employee's resignation from employment with
Employer, he shall not, directly or indirectly, do or suffer any of the
following:
(i) own, manage, control or participate in the
ownership, management, or control of, or be employed or
engaged by or otherwise affiliated or associated as a
consultant, independent contractor or otherwise with, any
other corporation, partnership, proprietorship, firm,
association, or other business entity, or otherwise engage in
any business, which directly of indirectly acquires, or
solicits to acquire, property management agreements or any
other service agreement directly relating to any property with
respect to which Employer or any of its subsidiaries or
affiliates has contracted to provide (or is actively
negotiating to provide) similar services on the date that
Employee's employment relationship with Employer is terminated
hereunder; provided, however, that the ownership of not more
than one percent (1%) of the stock of any publicly-traded
corporation shall not be deemed a violation of this covenant;
(ii) employ, assist in employing, or solicit for
employment any employee or officer of Employer or any of
Employer's affiliates or subsidiaries who was employed or
retained at any time during the one (1) year period preceding
the date on which Employee's employment with Employer is
terminated;
(iii) induce any person who is an employee or officer
of Employer or any of Employer's affiliates or subsidiaries to
terminate said relationship in such a manner which is not in
furtherance of Employer's interest; or
(iv) except in performing services hereunder,
disclose, divulge, discuss, copy or otherwise use or suffer to
be used in any manner, in competition with, or
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contrary to the interests of, Employer or any of Employer's
affiliates or subsidiaries entities, the proprietary customer
lists, limited partner lists, research or data or other trade
secrets of Employer or any of Employer's affiliates or
subsidiaries, it being acknowledged by Employee that any such
proprietary information regarding the business of Employer and
Employer's affiliates or subsidiaries entities compiled or
obtained by, or furnished to, Employee while Employee shall
have been employed by or associated with Employer, and which
has not been publicly disclosed by Employer or which is
otherwise not available in the public domain, is confidential
information and Employer's property.
(b) Employee expressly agrees and understands that the remedy
at law for any breach by him of this Section 8 will be inadequate and
that the damages flowing from such breach are not readily susceptible
to being measured in monetary terms. Accordingly, it is acknowledged
that upon adequate proof of Employee's violation of any legally
enforceable provision of this Section 8, Employer shall be entitled to
immediate injunctive relief and may obtain a temporary order
restraining any threatened or further breach. Nothing in this Section 8
shall be deemed to limit Employer's remedies at law or in equity for
any breach by Employee of any of the provisions of this Section 8 which
may he pursued or availed of by Employer.
(c) Employee has carefully considered the nature and extent of
the restrictions upon him and the rights and remedies conferred upon
Employer under this Section 8, and hereby acknowledges and agrees that
the same are reasonable in time and territory, are designed to
eliminate competition which otherwise would be unfair to Employer, do
not stifle the inherent skill and experience of Employee, would not
operate as a bar to Employee's sole means of support, are fully
required to protect the legitimate interests of Employer and do not
confer a benefit upon Employer disproportionate to the detriment to
Employee.
9. Withholding Taxes. All payments to Employee shall be subject to
withholding on account of federal, state and local taxes as required by law. Any
amounts remitted by Employer to the appropriate taxing authorities as taxes
withheld by Employer from Employee on income realized by Employee with respect
to the vesting of his shares of Restricted Stock shall reduce the amounts
payable by Employer to Employee by way of compensation or otherwise. If any
particular payment required hereunder is insufficient to provide the amount of
such taxes required to be withheld, Employer may withhold such taxes from any
other payment due Employee. In the event all cash payments due Employee are
insufficient to provide the required amount of such withholding taxes, Employee,
within thirty (30) days of written notice from Employer, shall pay to Employer
the amount of such withholding taxes in excess of all cash payments due Employee
at the time such withholding is required to be made by Employer, provided,
however, the foregoing shall not be deemed to limit Employee's right to receive
loans from Employer to fund income tax obligations as set forth in Section 3 of
this Agreement.
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10. No Conflicting Agreement. The parties hereto represent and warrant
to each other that they are not a party to any agreement, contract or
understanding, whether employment or otherwise, which would restrict or would
prohibit them from undertaking or performing in accordance with the terms and
conditions of this Agreement. Employer represents and covenants that its
entering into this Agreement has been duly authorized and ratified, and that it
has full authority to consummate the undertakings set forth herein including,
without limitation, the grant of the Restricted Stock and Stock Options to
Employee.
11. Severable Provisions. The provisions of this Agreement are
severable and if any one or more provisions may be determined to be illegal or
otherwise unenforceable, in whole or in part, the remaining provisions and any
partially unenforceable provision to the extent enforceable in any jurisdiction
shall, nevertheless, be binding and enforceable.
12. Binding Agreement. The rights and obligations of Employer under
this Agreement shall inure to the benefit of, and shall be binding upon,
Employer and its successors and assigns, and the rights and obligations (other
than obligations to perform services) of Employee under this Agreement shall
inure to the benefit of, and shall be binding upon, Employee and his heirs,
personal representatives and estate. Employer agrees and acknowledges that the
services Employee is providing Employer are personal to Employer, and Employer
shall not have the right to assign this Agreement without Employee's written
consent.
13. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the breach thereof, shall be settled by arbitration in
accordance with the Rules of the American Arbitration Association then
pertaining in the City of Columbus, Ohio, and judgment upon the award rendered
by the Arbitrator or Arbitrators may be entered in any Court having jurisdiction
thereof. The Arbitrator or Arbitrators shall be deemed to possess the powers to
issue mandatory orders and restraining orders in connection with such
arbitration; provided, however, that nothing in this Section 13 shall be
construed so as to deny Employer the right and power to seek and obtain
injunctive relief in a court of equity for any breach or threatened breach of
Employee of any of his covenants contained in Section 8(a) of this Agreement.
14. Notices. Any notice to be given under this Agreement shall be
personally delivered in writing or shall have been deemed duly given when
received after it is posted in the United States mail, postage prepaid,
registered or certified, return receipt requested, and if mailed to Employer,
shall be addressed to its principal place of business, attention: General
Counsel, and if mailed to Employee, shall be addressed to him at his home
address last known on the records of Employer, or at such other address or
addresses as either Employer or Employee may hereafter designate in writing to
the other.
15. Waiver. The failure of either party to enforce any provision or
provisions of this Agreement shall not in any way be construed as a waiver of
any such provision or provisions as to any future violations thereof, nor
prevent that party thereafter from enforcing each and every other provision of
this Agreement. The rights granted the parties herein are cumulative and the
waiver
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of any single remedy shall not constitute a waiver of such party's right to
assert all other legal remedies available to it under the circumstances.
16. Miscellaneous. This Agreement supersedes all prior agreements and
understandings between the parties and may not be modified or terminated orally.
No modification, termination or attempted waiver shall be valid unless in
writing and signed by the party against whom the same it is sought to be
enforced.
17. Governing Law. This Agreement shall be governed by and construed
according to the laws of the State of Ohio.
18. Captions and Section Headings. Captions and section headings used
herein are for convenience and are not a part of this Agreement and shall not be
used in construing it.
19. Miscellaneous. Where necessary or appropriate to the meaning
hereof, the singular and plural shall be deemed to include each other, and the
masculine and neuter shall be deemed to include each other.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement
on the day and year first set forth above.
"EMPLOYER"
ATTEST: CARDINAL REALTY SERVICES, INC.
______________________________ By: Xxxx X. Xxxxxxxx, Xx.
---------------------------------
XXXX X. XXXXXXXX, XX.,
President
______________________________ and Chief Executive
Officer
"EMPLOYEE"
------------------------------
Xxxx X. Xxxxx
------------------------------------
XXXX X. XXXXX
------------------------------
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