Exhibit 10.17
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Agreement is made as of the 1st day of January, 1997,
between Pennsylvania Real Estate Investment Trust ("PREIT") and Xxxxxxx
X. Xxxx ("Employee").
Background of Agreement
Employee has, for many years, served PREIT faithfully as a
Vice President or Senior Vice President-Acquisitions and is acknowledged as
having been instrumental in the growth and success of PREIT. PREIT desires
that Employee continue to serve in his current or in another executive
capacity, and Employee desires to continue to so serve. The parties are
entering into this Agreement to amend and restate in its entirety the
Employment Agreement between the parties dated as of October 1, 1985, as
extended (the "Original Agreement"), and to provide for the relationships and
obligations of each of the parties hereto with respect to the employment of
Employee.
NOW, THEREFORE, the parties hereto, intending to be legally
bound hereby and in consideration of the mutual covenants herein contained,
agree as follows:
1. Employment. PREIT hereby employs the Employee, and the
Employee hereby accepts employment, upon the terms and conditions set forth
herein.
2. Duties. Employee shall serve PREIT in the position of
Senior Vice President-Acquisitions or in such other executive capacity as
shall be determined by the Board of Trustees and as shall be consistent with
Employee's skills and experience. Employee shall devote his time, attention
and best efforts to the performance of his duties hereunder and shall not,
during the term of his employment, be engaged in any other business activity
(whether or not such business activity is pursued for gain, profit or other
pecuniary advantage) that would interfere with the services to be rendered by
Employee hereunder. However, this provision shall not prevent Employee from
investing his assets in such form or manner as will not require any service on
his part in connection with such investments.
3. Term. The term of employment hereunder shall commence on
the date first set forth above and shall continue for an initial term expiring
December 31, 1999. The initial or any additional term of employment shall be
automatically extended for an additional term of one year unless either party
gives the other not less than one hundred eighty (180) days notice prior to
the expiration of the then current term of its or his intention not to extend
the term of such employment. If such notice is given, the term of employment
shall terminate at the end of the then current term.
4. Basic Compensation. PREIT agrees to pay and Employee
agrees to accept, as the basic compensation for all services to be rendered by
Employee hereunder, the sum of $136,500 per annum, payable
in approximately equal weekly, bi-monthly or monthly installments. The Board
of Trustees of PREIT (or any Committee of the Board thereunto authorized), in
its sole discretion, may increase (but not decrease) the annual basic
compensation payable hereunder at any time or times during the term hereof.
5. Working Facilities and Expenses. PREIT shall furnish
Employee with appropriate office space, stenographic help and other facilities
and services suitable to his employment hereunder and adequate for the
performance of his duties. PREIT shall also pay directly or reimburse to
Employee all business-related expenses incurred in the course of his duties
hereunder.
6. Termination of Employment. In addition to the provisions
contained in Section 2 hereof, PREIT shall have the right to terminate the
term of employment pursuant to the provisions of Sections 6.1 and 6.2 hereof
and the term of employment shall end upon the occurrence described in Section
6.3 hereof:
6.1 Upon thirty (30) days written notice for "good
cause." The term "good cause" shall mean (i) dishonesty; (ii) conduct on the
part of Employee intended to injure the business of PREIT; (iii) Employee's
(a) indictment for a crime involving moral turpitude relating to his
employment or (b) conviction for a crime involving moral turpitude not
involving employment, whether or not an appeal shall be pending; (iv)
insobriety repeated after notice; or (v) a material
failure of Employee to perform or observe the provisions of this Agreement
(other than by reason of illness or incapacity) which persists for an
unreasonable period of time after notice is given to Employee which details
the failure.
6.2 By complying with the provisions of Section 7 hereof.
6.3 Upon the death of Employee.
7. Disability.
7.1 Effect of Disability. In the event that during the
term of employment Employee shall become disabled so that he is unable to
perform his duties hereunder, the compensation herein provided shall continue
to be paid until PREIT exercises its right of termination set forth herein.
Should the disability continue for more than six (6) consecutive months or
should such disability exist for more than nine (9) months in any twelve (12)
month period, PREIT shall have the right to terminate the term of employment,
without further liability to pay compensation hereunder, by giving Employee
thirty (30) days notice of its intention to do so. If Employee shall resume
his duties within thirty (30) days after such notice is given and shall
perform such duties on a regular basis for three (3) consecutive months
thereafter, the term of employment shall continue in full force and effect and
the notice of intention to terminate shall have no further force or
validity; otherwise the term of employment shall terminate at the end of such
thirty (30) day period or, if applicable, upon the recurrence of disability
during the three (3) month period.
7.2 Determination of Disability. Employee shall be deemed
disabled for purposes of this Agreement either (i) if he is deemed disabled
for purposes of any disability policy, group or individual, paid for by PREIT
and at the time in effect, or (ii) if no such policy is then in effect, by an
independent referee licensed to practice medicine selected by the Board of
Trustees of PREIT and approved by Employee or in the event that PREIT and
Employee are unable to agree on a single referee, then by a panel of three (3)
independent referees licensed to practice medicine, one of whom shall be
selected by PREIT, one by Employee and a third by the other two (2) referees.
7.3 Clarification. Employee shall not be entitled to the
benefits of Sections 7.1 and 7.2 hereof if he should become disabled after his
employment has been terminated pursuant to the provisions of Section 6.1
hereof.
8. Rights and Obligations on Termination and Expiration.
8.1 In the event that PREIT terminates Employee's
employment hereunder without cause, PREIT shall pay to Employee within thirty
(30) days of such termination (a) the sum, if any, required under clause (a)
of the second sentence of Section 9.1 hereof plus (b) the
amount obtained by multiplying Employee's annual basic compensation in effect
at the date of termination by the number of months (but not less than 12
months) in the remainder of the employment term hereunder at the date of
termination (which shall include any additional term resulting from a failure
to give timely notice of non-extension under Section 3 hereof) and dividing
the result by twelve (12). The resulting amount under (b) of the preceding
sentence shall then be discounted at the prime rate then prevailing at
CoreStates Bank, N.A. (or its successor), assuming that the resulting amount
had been paid out over the greater of the remainder of the employment period
and 12 months in accordance with PREIT's normal payroll practices at the time
of termination. The discounted value of Employee's basic compensation for 12
months shall be paid without regard to any obligation that Employee might
otherwise have to mitigate damages, and Employee shall not be required to seek
other employment to reduce the aforesaid amount; nor shall PREIT be entitled
to set-off against the amount aforesaid any sums earned by Employee in other
employment or to obtain reimbursement in respect of such amount out of such
earnings. It is, however, understood and agreed that any rights which Employee
may have in respect of compensation for the remainder of the term (including
any additional term referred to above), if any, in excess of twelve (12)
months from the date of termination shall be subject to such obligations to
mitigate damages as exist under applicable law. Moreover, Employee agrees
that, except in connection with the obligations in respect of annual basic
compensation herein described and obligations under other contracts and
applicable law, PREIT shall have no obligation to Employee as a consequence of
such
wrongful termination.
8.2 In the event that, within eighteen (18) months of a
Change of Control of PREIT, PREIT or its successor shall give Employee notice
of its intention not to extend the term of Employee's employment under this
Agreement, PREIT shall pay to Employee within thirty (30) days of the
expiration date (a) the sum, if any, required under Section 9 hereof plus (b)
an amount equal to Employee's annual basic compensation in effect at
expiration, discounted at the prime rate then prevailing at CoreStates Bank,
N.A. (or its successor) assuming that the annual basic compensation had been
paid out over 12 months in accordance with PREIT's normal payroll practices at
the time of expiration. The discounted value of Employee's annual basic
compensation shall be paid without regard to any obligation that Employee
might otherwise have to mitigate damages, and Employee shall not be required
to seek other employment to reduce the aforesaid amount; nor shall PREIT be
entitled to set-off against the amount aforesaid any sums earned by Employee
in other employment or to obtain reimbursement in respect of such amount out
of such earnings.
8.3 All payments under this Section 8 or other provisions
hereof shall be subject to and reduced by any federal, state or local
withholding or similar tax required under applicable law.
8.4 The term "Change of Control" as used in Section 8.2
hereof shall have the meaning ascribed to such term under the
Pennsylvania Real Estate Investment Trust Amended Incentive and Non-
Qualified Stock Option Plan as constituted on the date hereof, a copy of
which definition is attached hereto.
9. Additional Benefits.
9.1 Employee shall be entitled to receive benefits
equivalent to those presently provided to him by PREIT and such additional
benefits as may be provided to a majority of the other executive employees of
PREIT, including, without limitation, contributions by PREIT on his behalf in
connection with the non-qualified deferred compensation plan (the "Plan")
maintained for executive officers of PREIT. In the event of the applicability
of either Section 8.1 or 8.2 hereof, Employee shall be entitled to receive (a)
at the time set forth in Section 8.1 or 8.2, as applicable, a sum, without
discount, equal to the amount of the contribution to the Plan accrued to the
date of termination or expiration but not paid plus the amount which would
have been contributed in respect of the period (12 months or, if applicable,
the remainder of the employment term) referred to in the first sentence of the
applicable Section and (b) reimbursement for a one year period following such
termination or expiration of payments required to be made by Employee to
maintain the health care coverage provided by PREIT to Employee and his family
at the time of termination. The good faith determination by the Chief
Executive Officer of PREIT of the sum to be paid to Employee pursuant to
clause (a) of the preceding sentence shall be conclusive in the absence of
manifest error.
9.2 Employee acknowledges that he has received payment
net of applicable tax withholding for all unused vacation time to date and
that, hereafter, he shall be entitled to paid vacation and payment in respect
of unused vacation time in accordance with the policy of PREIT for executive
personnel as in effect from time to time during the term of his employment.
10. Trade Secrets; Confidential Information. In the event
that, during the course of his employment hereunder, Employee shall acquire
trade secrets or other information confidential to the business of PREIT,
Employee agrees not to disclose any such information, during or after his term
of employment, to any person, firm, corporation or other entity for any reason
whatsoever. Employee may disclose information if required to do so by order of
a court of competent jurisdiction or by a government agency acting under due
authority provided that Employee shall have given PREIT written notice of any
effort to compel such disclosure as promptly as possible and shall cooperate
with PREIT at PREIT's expense in all lawful ways requested by PREIT in
connection with any effort by PREIT to contest or restrict such disclosure.
11. Notices. Any notice required or permitted under this
Agreement shall be in writing and shall be deemed to have been given when
delivered personally or sent by registered or certified mail,
postage prepaid, addressed as follows:
If to Employee:
Xxxxxxx Xxxx
#0 Xxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
If to PREIT:
Pennsylvania Real Estate Investment Trust
000 Xxxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: President
The designation of the person to be so notified or the address of such person
for the purposes of such notice may be changed from time to time by a similar
notice to be effective ten (10) days after such change designation is
supplied.
12. Binding Effect. This Agreement and all of the terms
hereof shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, successors, administrators and assigns.
13. Location of Employment. Employee's place of employment
shall be Philadelphia or elsewhere in Pennsylvania within a twenty (20) mile
radius of Philadelphia.
14. Severability. If any term or provision of this Agreement
is held to be invalid or unenforceable for any reason, such invalidity or
unenforceability shall not affect any other term or provision hereof, and this
Agreement shall continue in full force and effect as if such
invalid or unenforceable term or provision (to the extent of the invalidity or
unenforceability) had not been contained herein.
15. Headings. The section headings in this Agreement are for
reference purposes only and shall not define, limit or affect the meaning or
interpretation of this Agreement.
16. Applicable Law. This Agreement shall be construed and
enforced in accordance with the laws of the Commonwealth of Pennsylvania.
17. Entire Agreement. This Agreement contains the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior negotiations, understandings
and agreements (including, without limitation, the Original Agreement), if
any, with respect to such subject matter and there are no agreements other
than those set forth, provided for, or referred to herein.
18. Liability Limited to Trust's Property. Neither the
Trustees of PREIT nor its shareholders shall be held to any personal liability
hereunder, and Employee agrees to look only to the property of PREIT for
satisfaction of obligations hereunder.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written on this 16th day of April, 1997.
PENNSYLVANIA REAL ESTATE
INVESTMENT TRUST
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, Trustee
By: /s/ Xxxxxxxx X. Xxxxxx
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Xxxxxxxx X. Xxxxxx, Trustee
EMPLOYEE
/s/ Xxxxxxx X. Xxxx 4/10/97
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Xxxxxxx X. Xxxx
