Exhibit 10.14
EMPLOYMENT AGREEMENT
Employment Agreement (the "Agreement"), made and entered into as of
January 2, 1998 by and between Xxxxxxx X. Xxxxxxx, Xx. ("Employee") and
Brandywine Realty Trust, a Maryland real estate investment trust (the
"Company").
BACKGROUND
The Company desires to employ Employee, and Employee desires to enter
into the employ of the Company, on the terms and conditions contained in this
Agreement.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein, and intending to be legally bound hereby, the parties hereto agree as
follows:
1. Employment. The Company hereby employs Employee, and Employee
hereby accepts employment by the Company, for the period and upon the terms and
conditions contained in this Agreement.
2. Office and Duties.
(a) Employee shall be employed by the Company as its Chairman of
the Board and will serve as a member of the Board of Trustees of the Company
(the "Board") and member of the Executive Committee of the Board, and shall
perform such duties and shall have such authority as may from time to time be
specified by the Board. Employee shall report directly to the Board.
(b) Without further consideration, Employee shall, as directed
by the Board, serve as a director or officer of, or perform such other duties
and services as may be requested for and with respect to, any of the Company's
Subsidiaries, including, without limitation, Brandywine Realty Services
Corporation. As used in this Agreement, the terms "Subsidiary" and
"Subsidiaries" shall mean, with respect to any entity, any corporation,
partnership, limited liability company or other business entity in which the
subject entity has the power (whether by contract, through securities ownership,
or otherwise and whether directly or indirectly through control of one or more
intermediate Subsidiaries) to elect a majority of board of directors or other
governing body, including, in the case of a partnership, a majority of the board
of directors or other governing body of the general partner.
(c) Employee shall devote his full working time, energy, skill
and best efforts to the performance of his duties hereunder, in a manner which
will faithfully and diligently further the business interests of the Company and
its Subsidiaries.
3. Term. Unless sooner terminated as hereinafter provided, the term
of Employee's employment shall be for a period of five (5) years (the "Term")
commencing on the date hereof. The Term shall automatically renew for
additional one-year periods at the expiration
of the then current Term unless either party shall give notice of his or its
election to terminate Employee's employment at least one year prior to the
end of the then-current Term, unless earlier terminated as hereinafter
provided.
4. Base Salary. For all of the services rendered by Employee to the
Company and its Subsidiaries, Employee shall receive an aggregate base salary of
$250,000 per annum during the term of his employment hereunder. Such salary may
be paid, at the election of the Company, either by the Company or by one or more
of its Subsidiaries, in such relative proportions as the Company may determine,
as earned in periodic installments in accordance with the Company's normal
payment policies for executive officers. In the event that the Employee is also
employed during any period by a Subsidiary of the Company, the amount of the
base salary payable by the Company during such period shall be reduced by the
amount of salary received by Employee during such period from such Subsidiary.
Employee's base salary shall be subject to review by the Board not less
frequently than annually, and Employee shall receive such salary increases as
the Board may from time to time approve.
5. Bonus. Employee shall receive, during the term of his employment
hereunder, such annual bonus as the Board, in its sole discretion, may determine
from time to time. Any such bonus may be based on Employee's annual performance
goals as established by the Board from time to time.
6. Participation in Incentive Plans. In addition to Employee's
eligibility to receive annual bonuses pursuant to Section 5, Employee shall be
entitled to participate in short-term and long-term incentive plans as shall be
maintained by the Company from time to time on such terms and conditions as
shall be established by the Board.
7. Prior Warrants. Nothing in this Agreement shall affect the terms
and conditions of warrants granted by the Company to Employee before the date of
this Agreement. Such warrants shall continue in force as in effect immediately
before the date of this Agreement.
8. Fringe Benefits. Throughout the term of his employment and as
long as they are kept in force by the Company, Employee shall be entitled to
participate in and receive the benefits of any profit sharing plan, retirement
plan, health or other employee benefit plan made available to other executive
officers of the Company, but in no event shall such benefits be less favorable
to Employee than the benefits listed on Schedule A hereto.
9. Automobile Allowance. Employee shall receive, during the term of
his employment hereunder, an automobile allowance of $833 per month.
10. Expenses. The Company shall reimburse Employee for all
reasonable, ordinary and necessary business expenses incurred by Employee in
connection with the performance of Employee's duties hereunder upon receipt of
vouchers therefor and in accordance with the Company's regular reimbursement
procedures and practices in effect from time to time.
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11. Vacation. Employee shall be entitled to a vacation of four (4)
weeks during each twelve (12) month period of his employment hereunder, during
which time Employee's compensation hereunder shall be paid in full. Employee
shall be permitted to carry over unused vacation during each twelve (12) month
period during the term and use such unused vacation in any subsequent twelve
(12) month period during the term.
12. Disability. If the Board determines in good faith by a vote of a
majority of its members (other than Employee) that Employee is unable to perform
his duties hereunder due to partial or total disability or incapacity resulting
from a mental or physical illness or injury or any similar cause for a period of
one hundred and twenty (120) consecutive days or for a cumulative period of one
hundred and eighty (180) days during any twelve (12) month period,
the Company shall have the right to terminate Employee's employment at any time
thereafter.
13. Death. Employee's employment shall terminate at the time of his
death.
14. Termination of Employment for Cause. The Company may discharge
Employee at any time for Cause. Cause shall mean: (i) habitual intoxication;
(ii) drug addiction; (iii) intentional and willful violation of any express
direction of the Board; (iv) theft, misappropriation or embezzlement of the
Company's funds; (v) conviction of a felony; or (vi) repeated and consistent
failure of Employee to be present at work during regular hours without valid
reason therefor.
15. Termination of Employment Without Cause. The Board, in its sole
discretion, may terminate Employee's employment hereunder without Cause upon 30
days' prior written notice to Employee at any time.
16. Resignation For Good Reason. Employee's resignation shall be
treated as a "Resignation for Good Reason" if Employee resigns within six (6)
months after any of the following circumstances, unless in the case of the
circumstances set forth in paragraphs (b), (c) or (d) below, such circumstances
are fully corrected within 30 days of Employee's delivery of notice to the
Company:
(a) A reduction in Employee's annual rate of base salary;
(b) A failure of the Company to make the payments required by
Section 4 hereof;
(c) A significant adverse alteration in the nature or status of
Employee's responsibilities;
(d) Any other material breach by the Company of this Agreement;
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(e) Relocation (without the written consent of Employee) of the
Company's executive offices to a location more than 30 miles from its current
location; or
(f) Upon a Change of Control (as defined in Section 17).
17. Change of Control. For purpose of this Agreement, a "Change of
Control" means:
(a) A "Change of Control" within the meaning of Section 1(d) of
the Brandywine Realty Trust 1997 Long-Term Incentive Plan, as currently in
effect; or
(b) The purchase of any common shares of beneficial interest of
the Company pursuant to a tender or exchange offer other than an offer by the
Company.
18. Payments Upon or After Termination of Employment.
(a) Voluntary Resignation Other than for Good Reason;
Termination for Cause; Non-Renewal of Employment Agreement. If Employee's
employment hereunder is terminated before the expiration of the Term because of
Employee's voluntary resignation (other than a Resignation for Good Reason) or
because of the Company's termination of Employee's employment for Cause, or if
Employee's employment is terminated at the expiration of the Term following an
election by either the Company or Employee not to renew the Term pursuant to
Section 3, the Company, or at its direction, its Subsidiaries shall pay to
Employee or, as appropriate, his legal representatives, heirs or estate all
amounts payable under Sections 4 and 8 accrued through the applicable date of
termination (the "Accrued Amount") within 30 days after such date of
termination. If Employee's employment is terminated by the Company for Cause or
by the Employee voluntarily (unless such termination of employment is a
Resignation for Good Reason), or if Employee's employment is terminated at the
expiration of the Term following an election by either the Company or Employee
not to renew the Term pursuant to Section 3, the Company shall have no
obligation or liability hereunder after the date of discharge or termination to
pay or provide base salary, bonus compensation, fringe benefits, or any other
form of compensation hereunder other than to pay the Accrued Amount.
(b) Termination of Employment Because of Death. If Employee's
employment is terminated as a result of the Employee's death before the
expiration of the Term, the Company shall pay Employee's legal representatives
the Accrued Amount as of the date of Employee's death, and, in addition, the
consideration provided for in Section 4 hereof, at the rate in effect at the
date of termination, for one year after such death, less the proceeds receivable
by Employee's heirs and legal representatives from any life insurance policy
provided by the Company. In addition, Employee shall be entitled to receive an
amount equal to the product that results from multiplying the amount of the
bonus paid to him pursuant to Section 5 hereof for the calendar year prior to
the year in which Employee dies multiplied by a fraction, the numerator of
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which is the number of days that Employee was alive during the year in which
the death occurs and the denominator of which is 365.
(c) Termination of Employment Because of Disability. If
Employee's employment is terminated by the Company for disability before the
expiration of the Term, the Company shall pay Employee the Accrued Amount as of
the such date of termination, and, in addition, the consideration described in
Sections 4 and 8 hereof, at the rate in effect at the date of termination, until
one year after Employee becomes eligible to receive benefits pursuant to the
disability insurance policy provided by the Company, at the rate in effect at
such date of termination, less the amount of disability insurance proceeds
receivable by Employee, provided that such period shall not exceed two years in
the aggregate. In addition, Employee shall be entitled to receive an amount
equal to the product that results from multiplying the amount of the bonus paid
to him pursuant to Section 5 hereof for the calendar year prior to the year in
which Employee's employement is terminated for disability multiplied by a
fraction, the numerator of which is the number of days that elapsed prior to the
termination during the year in which the termination occurs and the denominator
of which is 365.
(d) Termination of Employment by Company Without Cause;
Resignation for Good Reason. If Employee's employment is terminated by the
Company without Cause, or Employee Resigns for Good Reason, within 30 days
following the date of such termination of employment, the Company shall pay
Employee the Accrued Amount as of the date of such termination, and in addition:
(i) Subject to Section 18(d)(ii), the Company shall make a
cash lump sum payment to Employee equal to the greater of:
(A) the product of three (3) times the greater of
(1) the sum of the amounts paid or payable to Employee pursuant to Sections 4
and 5 hereunder (and the short-term portion of any bonus amounts paid or
payable pursuant to Section 6 hereunder) for the calendar year preceding the
calendar year in which such termination of employment occurs or (2) the sum
of the amounts paid or payable to Employee pursuant to Sections 4 and 5
hereunder (and the short-term portion of any bonus amounts paid or payable
pursuant to Section 6 hereunder) during the one-year period ending on the
date of such termination, provided that if such date of termination occurs
before the first anniversary of the date hereof, the cash lump sum payment
shall be equal to the product of three (3) times the sum of (x) Employee's
annualized base salary pay rate in effect as of such date of termination and
(y) the maximum bonus that would have been payable for the year that includes
such date of termination if all of the conditions for the payment of such
maximum bonus had been satisfied; or
(B) The amount payable pursuant to Section 4 hereunder
for the remainder of the Term at a rate equal to his base salary in effect at
the time of the date of such termination.
(ii) Employee may, in his sole discretion, elect in writing
to decline to receive part or all of the amount otherwise payable pursuant to
Section 18(d)(i). In
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addition, if, following payment of part or all of the amount payable pursuant
to Section 18(d)(i), Employee determines that Employee would be in a better
net after-tax position than he would be in if he retained such amount,
Employee may elect in writing to repay the Company the amount, plus interest
payable from the date of payment to the date of repayment at the "applicable
federal rate" as determined pursuant to section 1274 of the Code, and upon
such repayment and to the extent thereof, the original payment shall be
treated as a loan between the Company and Employee.
(e) In the event that Employee is employed by a Subsidiary of
the Company at the time of termination of employment, any amounts payable to the
Employee pursuant to this Section 18 shall be reduced by the amounts paid to
Employee by any such Subsidiary.
(f) Upon the payment of the amounts payable under this Section
18, neither the Company nor any of its Subsidiaries shall have any further
obligations hereunder to Employee (or to his estate, heirs, beneficiaries, or
legal representatives, as appropriate, or otherwise) to pay or provide any base
salary, bonus compensation, or fringe benefits, provided that if Employee
Resigns for Good Reason or the Company terminates Employee's employment without
Cause, Company shall, at its own expense, for a thirty-six (36) month period
after the date of termination of employment, arrange to provide Employee with
life, disability, accident and health insurance benefits substantially similar
to those which Employee was entitled to receive immediately prior to such date
of termination.
19. Prior Agreement. This Agreement is the successor to the
Employment Agreement between Employee and the Company dated as of July 31, 1996
(which Agreement was assigned to the Company as of October 31, 1996). Employee
represents to the Company that (a) there are no other agreements or
understandings with the Company to which Employee is a party relating to
employment, benefits or retirement, (b) there are no restrictions, agreements or
understandings whatsoever to which Employee is a party which would prevent or
make unlawful his execution of this Agreement or his employment hereunder, (c)
his execution of this Agreement and his employment hereunder shall not
constitute a breach of any contract, agreement or understanding, oral or
written, to which he is a party or by which he is bound, and (d) he is free and
able to execute this Agreement and to continue in the employment of the Company.
20. Key Man Insurance. The Company shall have the right at its
expense to purchase insurance on the life of Employee in such amounts as it
shall from time to time determine, of which the Company shall be the
beneficiary. Employee shall submit to such physical examinations as may be
required, and shall otherwise cooperate with the Company, in connection with the
Company obtaining such insurance.
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21. Miscellaneous.
(a) Controlling Law. This Agreement, and all questions relating
to its validity, interpretation, performance and enforcement, shall be governed
by and construed in accordance with the laws of the Commonwealth of
Pennsylvania.
(b) Notices. All notices, requests, demands and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given, made and received when delivered in
person against receipt, or when sent by United States registered or certified
mail, return receipt requested, postage prepaid, addressed as set forth below:
(i) If to Employee:
Xxxxxxx X. Xxxxxxx, Xx.
0000 Xxxxx Xxxxx
Xxxxxxx Xxxxxx, XX 00000
(ii) If to the Company:
Brandywine Realty Trust
00 Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx Xxxxxx, XX 00000
Attention: General Counsel
In addition, notice by mail shall be by air mail if posted outside of
the continental United States.
Any party may alter the address to which communications or copies are
to be sent by giving notice of such change of address in conformity with the
provisions of this paragraph for the giving of notice.
(c) Binding Nature of Agreement. This Agreement shall be
binding upon and inure to the benefit of the Company and its successors and
assigns and shall be binding upon Employee, his heirs and legal representatives.
(d) Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original
as against any party who executes the same, and all of which shall constitute
one and the same instrument. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories.
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(e) Provisions Separable. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.
(f) Entire Agreement. This Agreement contains the entire
understanding among the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and understandings, inducements or
conditions, express or implied, oral or written, except as herein contained.
The express terms hereof control and supersede any course of performance and/or
usage of the trade inconsistent with any of the terms hereof. This Agreement
may not be modified or amended other than by an agreement in writing.
(g) Section and Paragraph Headings. The section and paragraph
headings in this Agreement are for convenience only; they form no part of this
Agreement and shall not affect its interpretation.
(h) Gender, Etc. Words used herein, regardless of the number
and gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.
(i) Number of Days. In computing the number of days for
purposes of this Agreement, all days shall be counted, including Saturdays,
Sundays and holidays; provided, however, that if the final day of any time
period falls on a Saturday, Sunday or holiday, then the final day shall be
deemed to be the next day which is not a Saturday, Sunday or holiday.
(j) Survival. The provisions of Sections 7, 12, 13, 14, 15, 16,
17, 18 and 19 shall survive the expiration or termination of the term of
Employee's employment hereunder.
(k) Assignability. This Agreement is not assignable by
Employee. It is assignable by the Company only (i) to any subsidiary of the
Company so long as the Company agrees to guarantee such subsidiary's obligations
hereunder, or (ii) subject to Sections 16 and 18 and only upon Employee's prior
written consent, to a person which is a successor in interest to the Company in
the business operated by it or which acquires all or substantially all of its
assets.
(l) Liability of Trustees, etc. No recourse shall be had for
any obligation of the Company hereunder, or for any claim based thereon or
otherwise in respect thereof, against any past, present or future trustee,
shareholder, officer or employee of the Company, whether by virtue of any
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such liability being expressly waived and released by each party
hereto.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered on the date first above-written.
BRANDYWINE REALTY TRUST
By: ____________________________________
Title:___________________________________
EMPLOYEE
/s/ Xxxxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxx, Xx.
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GUARANTEE
In the event that the Company fails to perform its obligations under
the foregoing Employment Agreement, Brandywine Operating Partnership, L.P. shall
promptly perform the obligations of the Company arising thereunder which have
not been performed in strict accordance with the terms and conditions thereof.
BRANDYWINE OPERATING PARTNERSHIP, L.P.
By: BRANDYWINE REALTY TRUST, its general partner
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx, President and Chief
Executive Officer
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