Exhibit 99.6
THIRD AMENDMENT TO EMPLOYMENT AGREEMENT
This Third Amendment (this "Third Amendment") is effective July 1, 2004
by and among Kramont Operating Partnership, L.P., a Delaware limited partnership
(the "Company"), Kramont Realty Trust, a Maryland real estate investment trust
("Kramont") and Xxxx X. Xxxxx ("Executive").
BACKGROUND
WHEREAS, the parties hereto entered into an Employment Agreement dated
effective March 21, 2002, as amended by First Amendment dated July 1, 2002 and
Second Amendment dated July 1, 2003 (herein referred to as "Employment
Agreement") wherein the parties agreed to the terms and conditions of
Executive's employment with the Company; and
WHEREAS, the parties hereto desire to further amend certain of the terms
and conditions of the Employment Agreement.
NOW THEREFORE, in consideration of the mutual promises and covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. All capitalized terms used herein, but not otherwise defined,
shall have the meanings ascribed in the Employment Agreement, with the exception
of the definitions of "Change of Control" and "Good Reason", which shall be
defined as follows:
"Change of Control" means the closing of a transaction or a series of
related transactions which involves (i) a transfer of all or substantially all
of Kramont's or the Company's assets and business (whether structured as an
acquisition, sale of assets, merger, consolidation or otherwise, and whether or
not Kramont or the Company is the surviving entity of the transaction); (ii) an
exchange of 35% or more of equity securities of Kramont for assets or stock of
another entity or Person, or (iii) the election to the Company's Board of
Trustees after a transaction described in (i) or (ii) of this paragraph of new
trustees not formerly associated with Kramont constituting a majority of the
number of Trustees of the Company then in office. A Change of Control will not
be deemed to have occurred, with respect to the Executive, if the Executive is
part of or affiliated with the group that consummates the change of control
transaction.
"Good Reason" means (a) a material breach by Company of any material
provision of this Agreement, (b) a material diminution in the level of
responsibilities or authority or compensation of Executive; or (c) Company's
requiring Executive to be based at any office or location outside of 50 miles
from the City of Philadelphia, provided, however, that no event or condition
described in clauses (a) through (c) of this definition shall constitute Good
Reason unless (i) Executive gives the Company written notice of his or her
objection to such event or condition, (ii) such event or condition is not
corrected by the Company within 20 business days of its receipt of such notice
(the "Cure Period") (or in the event that such event or condition is not
susceptible of correction within such 20 business day Cure Period, the Company
has not taken all reasonable steps within such Cure Period to correct such event
or condition as promptly as practicable thereafter and does, in fact, correct
such event or condition within ninety (90) days following the date that the
Executive gives the Company written notice of his or her objection)) and (iii)
Executive resigns his or her employment with the Company and its Affiliates by
written
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notice to the Company not more than 90 days following the expiration of the 20
business day Cure Period. The closing of a transaction entered into with the
prior consent of the Board of Trustees of Kramont or events which would have
constituted a Change in Control shall not constitute "Good Reason" unless a
violation of clauses (a), (b) or (c) of this definition occurs within one year
of the closing of the transaction and the Executive complies with all the other
requirements of this definition.
2. Notwithstanding anything to the contrary contained in
Paragraph 6(4), "Termination and Severance Benefits" - Without Cause: Good
Reason," the following shall replace the language contained in the Employment
Agreement:
"6(4) Without Cause: Good Reason. If, prior to
the expiration of the Term of Employment, Executive's employment is terminated
by the Company without Cause or the Company fails to renew an employment
agreement without cause, or if Executive terminates employment hereunder for
Good Reason: Executive shall become immediately entitled to receive a lump sum
payment by the Company (or its successor in interest) in an amount equal to two
(2) times the annual Base Salary, plus all accrued and unpaid bonus and other
awards and unreimbursed expenses. In the event that the Executive terminates
employment hereunder for Good Reason, all stock options and other awards subject
to vesting periods not then expired shall become fully vested Executive shall
have no further right to receive any other compensation or benefits after such
termination or resignation of employment. Executive shall have no obligation to
mitigate the Company's severance obligations under this paragraph and no amounts
earned by Executive following such termination shall be deemed to reduce the
payments required under this paragraph 6(4). Such payments shall be in lieu of
any and all entitlements that Executive may have by contract or otherwise." Any
payments hereunder shall be conditioned on the execution by the Executive of a
General Release in a form satisfactory to Kramont."
3. Notwithstanding anything to the contrary contained in
Paragraph 6(5) "Termination and Severance Benefits - Change of Control," the
following shall replace the language contained in the Employment Agreement:
"6(5) Change in Control. In the event of a
Change of Control, and the Executive is not offered the same or similar position
with the same or similar salary and benefits with the Company prior to the
closing of the transaction, or its successor in interest, or the entity
surviving the Change of Control, Executive shall have the right to terminate his
or her employment by written notice to the Company given within thirty (30) days
after the closing ("Closing") of the transactions giving rise to the Change of
Control, in which case, effective within ten (10) days following the Company's
receipt of Executive's termination notice: (i) Executive shall become
immediately entitled to receive a lump sum payment by the Company (or its
successor in interest) in an amount equal to two (2) times the sum of the annual
Base Salary and bonus, plus all accrued and unpaid bonus and other awards and
unreimbursed expenses, and (ii) all stock options and other awards subject to
vesting periods not then expired shall, effective upon such Closing, become
fully vested. For purposes of computing the sum of the base salary and bonus due
hereunder, bonus shall mean the regular average annual bonus as determined
previously by the Board's Compensation Committee paid to the Executive during
the three years prior to the event giving rise to the payment. Executive shall
have no obligation to mitigate the Company's severance obligations under this
paragraph and no amounts earned by Executive following such termination shall be
deemed to reduce the payments required under this paragraph 6(5). Such payments
shall be in lieu of any and all entitlements that Executive may
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have by contract or otherwise. Any payments hereunder shall be conditioned on
the execution by the Executive of a General Release in a form satisfactory to
Kramont.
4. Subject to the provisions contained in Paragraph 3 of the
Employment Agreement, the Term of Employment is hereby extended to December 31,
2005 (the "Extended Term of Employment"). The sentence "In the event the Company
gives notice to Executive of non-renewal of this Agreement, Company agrees to
provide Executive with ninety (90) days of continued base salary and bonus
payments pursuant to Paragraph (4) (a) and (b) hereof." is hereby deleted in its
entirety.
5. In accordance with paragraph 4 (A), during the Extended Term of
Employment, Executive's Base Salary shall be $218,400.00 payable in equal
bi-weekly installments in accordance with the Company's normal payroll
practices, subject to periodic review by the Board of Trustees Executive shall
also be eligible to participate in any bonus plan, as approved by the Board of
Trustees.
6. Paragraph 4 (B) is deleted in its entirety.
7. This Third Amendment and the Employment Agreement represent the
entire understanding between the parties and supersedes all other oral or
written agreements between the parties The Employment Agreement, as amended by
this Third Amendment, is hereby ratified and confirmed and remains in full force
and effect.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Third Amendment as of the date and year first above written.
KRAMONT OPERATING PARTNERSHIP, L.P.
By: /s/ XXXXX X. XXXXXX, XX.
---------------------------------
Dated: 12/20/04 Xxxxx X. Xxxxxx, Xx.
-------------- President
KRAMONT REALTY TRUST
By: /s/ XXXXX X. XXXXXX, XX.
---------------------------------
Dated: 12/20/04 Xxxxx X. Xxxxxx, Xx.
-------------- President
Executive
By: /s/ XXXX X. XXXXX
---------------------------------
Dated: 12/16/04 Xxxx X. Xxxxx
--------------
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