Exhibit 99.20
EXECUTION COPY
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered
into as of November 17, 2003, by and between Related Capital Company LLC, a
Delaware limited liability company (the "Company"), and Xxxxxx X. Xxxxxx (the
"Executive").
W I T N E S S E T H:
WHEREAS, the Company wishes to employ the Executive upon the
terms and subject to the conditions set forth herein, and the Executive desires
to enter into this Agreement and accept such employment upon such terms and
conditions;
WHEREAS, the Company, in addition to managing its own business
operations, provides management services for various of its Affiliates (as
defined below), including CharterMac, a Delaware statutory trust ("CharterMac");
and
WHEREAS, the governance of the Company is controlled by
CharterMac and the management of CharterMac is vested in its Board of Trustees
(the "Board").
NOW, THEREFORE, in consideration of the mutual covenants and
promises contained herein, the parties hereto, each intending to be legally
bound hereby, agree as follows:
Section 1. Employment. Subject to the terms and conditions set forth
herein, the Company shall employ the Executive as its Managing Director, and the
Executive accepts such employment for the Employment Term (as defined below).
During the Employment Term, the Executive shall perform the duties and functions
that are set forth on Exhibit A and such other duties and functions consistent
with Executive's role as a member of senior management of the Company as shall
be assigned to Executive from time to time by the Board. Upon the request of the
Board, or its designee, the Executive shall also serve as an officer, director
or trustee of any entity controlled by, controlling or under common control
(within the meaning of Rule 12b-2 promulgated under the Securities Exchange Act
of 1934, as amended (the "Exchange Act")) with, the Company (an "Affiliate") for
no additional compensation. Any compensation paid to the Executive by any
Affiliate shall reduce the Company's obligations hereunder by the amount of such
compensation (but shall be deemed to have been paid by the Company for purposes
of calculating any severance obligations to the Executive under this Agreement).
Section 2. Performance. During the Employment Term, the Executive will
serve the Company faithfully and to the best of his ability and will devote his
full business time, energy, experience and talents to the business of the
Company and its Affiliates. It is further understood that nothing herein shall
prevent the Executive from managing his passive personal investments and from
participating in charitable and civic endeavors, so long as such activities do
not interfere in any significant manner with the Executive's performance of his
duties hereunder. In addition, pursuant to and in accordance with that certain
Service Agreement dated as of November 17, 2003 between Relcap Holding Company
LLC ("Mirror Entity") and CharterMac Capital Company, LLC, a Delaware limited
liability company ("CCC"), it is understood that the Executive shall provide
services for Mirror Entity with respect to the Excluded Assets (as defined in
the Contribution Agreement dated as of December 17, 2002 among CCC and the other
parties identified therein (the "Contribution Agreement")). Executive
understands that his job responsibilities will include reasonable and customary
travel on behalf of the Company.
Section 3. Employment Term. Unless earlier terminated pursuant to
Section 6 hereof, the employment term shall begin upon the date hereof (the
"Effective Date") and shall continue for a period of three (3) years from such
date (the "Initial Term"); provided that such term shall automatically be
extended for additional periods of one year commencing on the third anniversary
of the Effective Date and each anniversary thereof (such period the "Additional
Term") unless either party shall have given notice to the other party that such
party does not desire to extend the term of this Agreement, such notice to be
given at least sixty (60) days prior to the end of the Initial Term or the
Additional Terms, as applicable (the Initial Term and the Additional Term or
Terms, if applicable, collectively, the "Employment Term").
Section 4. Compensation and Benefits.
(a) Base Salary. As compensation for services hereunder and in
consideration of the Executive's other agreements hereunder, during the
Employment Term the Company shall pay the Executive a base salary, payable in
equal installments in accordance with the Company's procedures, at an annual
rate of $500,000, less such deductions or amounts to be withheld as required by
applicable law and regulations and deductions authorized by the Executive in
writing, subject to review by the compensation committee of the Board (the
"Compensation Committee") in its discretion no less frequently than annually for
increase (such base salary, as increased from time to time being hereinafter
referred to as the "Base Salary"); provided, however, that the Executive shall
receive a minimum annual increase in Base Salary equal to the lesser of 5% or
the percentage equal to the increase, if any, in the Consumer Price Index
measured for the twelve (12) month period immediately preceding the effective
date of the increase. For purposes of this Section 4(a), "Consumer Price Index"
shall mean the Consumer Price Index for Urban Wage Earners and Clerical Works
(1982 - 1984 = 100) for the New York Metropolitan area published by the United
States Department of Labor, Bureau of Statistics.
(b) Cash Bonuses and Incentive Compensation. During the
Employment Term, the Executive shall have opportunities for cash bonuses and
shall be eligible to participate in all bonus and incentive compensation plans
made available by the Company from time to time. Bonus and incentive
compensation awards shall be considered at least annually by the Compensation
Committee.
(c) Medical, Dental, Disability, Life Insurance, Pension and
Other Benefits. During the Employment Term, the Executive shall, in accordance
with the terms and conditions of the applicable plan documents and all
applicable laws, be eligible to participate in the various medical, dental,
disability, life insurance, pension and other employee benefit plans, made
available by the Company, from time to time, for its senior executives, which
benefit package shall include those items identified on Exhibit B, subject to
adjustments thereto as determined by the Compensation Committee in its
discretion from time to time.
(d) Vacation. During the Employment Term, the Executive shall
be entitled to a vacation period or periods of four (4) weeks per year taken in
accordance with the vacation
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policy of the Company during each year of the Employment Term; provided, that
the Executive may carry forward up to two (2) weeks of unused vacation to the
subsequent year.
(e) Car Allowance. During the Employment Term, the Company will
purchase or lease a company car for the Executive's use and will pay the
reasonable expenses of operating and maintaining the car, including parking and
insurance costs. The company car shall be agreed upon between the Executive and
the Company from time to time and shall be a current model (not more than three
(3) years old) that is similar to the car, or most recent car, provided to the
Executive by the Company during the twelve-month period preceding the Effective
Date. If the Executive elects not to have the Company purchase or lease a car
for the Executive, the Company will make an annual payment to the Executive in
an amount reasonably determined by the Company as the approximate cost to have
been incurred by the Company in providing the car allowance benefit.
(f) Secretarial Service. During the Employment Term, the
Executive shall be entitled to secretarial service that is reasonably equivalent
to that provided to the Executive by the Company during the twelve-month period
preceding the Effective Date.
(g) Expenses. The Company shall pay for or reimburse the
Executive for all reasonable expenses actually incurred by or paid by the
Executive during the Employment Term in the performance of the Executive's
services under this Agreement (including, without limitation, out-of-pocket
expenses in connection with the Executive's ownership of Interests (but not
including capital contributions payable in connection with the acquisition of
such Interests) or serving as an officer, director or trustee of an Affiliate)
upon presentation of expense statements or vouchers or such other supporting
information as the Company customarily may require of its officers.
(h) Parallel Compensation. During the Initial Term, the
compensation and benefits referenced in this Section 4 and Section 5 shall be
equal for each member of senior management of the Company (consisting of the
Executive, Xxxx X. Xxxxxx, Xxxxxx X. Xxxxx and Xxxx X. Xxxxxxxxx), except for
the grant of additional post-termination continuing health care benefits to Xxxx
X. Xxxxxx.
Section 5. Share Options. CharterMac maintains an incentive share
option plan (the "Incentive Plan") for the benefit of directors, officers and
employees of CharterMac and its Affiliates. Subject to any applicable terms of
the Incentive Plan (as in effect from time to time), the Executive shall be
eligible for the receipt of options as the same may be awarded from time to time
in the discretion of the Compensation Committee.
Section 6. Termination.
(a) Termination of Employment. Subject to this Section 6(a),
the employment of the Executive hereunder shall terminate at the end of the
Employment Term. The employment of the Executive hereunder may be terminated at
any time during the Employment Term: (i) by the Company with or without Cause
(as defined herein) by notice of termination delivered to the Executive; (ii) by
the Executive with or without Good Reason (as defined herein) by notice of
resignation delivered to the Company; (iii) upon death of the Executive; or
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(iv) by the Company at any time after the last day of the sixth consecutive
month of the Executive's Disability (as defined herein) or the day on which the
shorter periods of Disability shall have equaled an aggregate of six (6) months,
by written notice to the Executive (but before the Executive has recovered from
such Disability).
(b) Certain Definitions. For purposes of this Agreement,
(i) "Cause" shall mean: (A) the Executive's conviction of,
plea of nolo contendere to, or written admission of the commission of, a felony;
(B) any breach by the Executive of any material provision of this Agreement; (C)
any act by the Executive involving dishonesty, moral turpitude, fraud or
misrepresentation with respect to his duties for the Company or its Affiliates,
which has caused material harm to the Company; or (D) gross negligence or
willful misconduct on the part of the Executive in the performance of his
duties, responsibilities or obligations as set forth in this Agreement;
provided, that in the case of a breach set forth in clause (B) above, such
breach shall continue for a period of thirty (30) days following written notice
thereof by the Company to the Executive.
(ii) "Change in Control" shall be deemed to have occurred
if: (A) any "person" or "group" (as such terms are used in Sections 13(d) and
14(d) of the Exchange Act), which is not an Affiliate of CharterMac or CCC is or
becomes the "beneficial owner" (as defined in Rule 13d-3 promulgated under the
Exchange Act), directly or indirectly, of securities of CharterMac representing
50.1% or more of the combined voting power of CharterMac's then outstanding
securities or becomes the managing member of CCC; (B) any consolidation or
merger of CharterMac or CCC with or into any other corporation or other entity
or person (other than an Affiliate of CharterMac or CCC) in which the
shareholders of CharterMac prior to such consolidation or merger own or owns
less than 50.1% of CharterMac's voting power immediately after such
consolidation or merger, or in which the managing member of CCC or another
Affiliate of CharterMac ceases to be the controlling person of the surviving
entity or person (excluding any consolidation or merger effected exclusively to
change the domicile of CharterMac or CCC); (C) a sale of all or substantially
all of the assets of CharterMac or CCC; or (D) a liquidation or dissolution of
CharterMac or CCC; provided, that no change in control shall be deemed to occur
with respect to any of the above-referenced events involving CCC if after such
event the Executive continues to be an employee of a company that is an
Affiliate of CharterMac and continues to have duties and functions and
compensation consistent with those referenced in Sections 1 through 5 of this
Agreement.
(iii) "Disability" shall be deemed to have occurred if in
the judgment of the a physician jointly selected by the Company and the
Executive, the Executive shall become physically or mentally disabled, whether
totally or partially, such that the Executive is unable to perform the
Executive's principal services hereunder for (A) a period of six consecutive
months or (B) for shorter periods aggregating six months during any twelve-
month period.
(iii) "Good Reason" shall mean the occurrence of the
following events without the Executive's prior written consent, provided that
such occurrence is not cured within thirty (30) days of the Executive giving the
Company written notice thereof: (A) assignment of the Executive to duties
materially inconsistent with the Executive's positions as described in Section 1
hereof, or any significant diminution in the Executive's duties or
responsibilities, other
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than in connection with the termination of the Executive's employment for Cause
or Disability or by the Executive other than for Good Reason; (B) any material
breach by the Company of its obligations under this Agreement which continues
for a period of thirty (30) days after notice to the Company; (C) a change in
the location of the Executive's principal place of employment to a location
outside of the general New York metropolitan area; (D) there is a reduction in
the Executive's Base Salary or a material reduction in the aggregate package of
benefits provided to the Executive under Sections 4(c) through 4(g) of this
Agreement; (E) so long as the holders of the Special Preferred Voting Shares (as
defined in the Second Amended and Restated Trust Agreement of CharterMac dated
as of November 17, 2003 (the "Trust Agreement")) continue to own in the
aggregate 7.5% or more of the outstanding voting securities of CharterMac, the
failure (not caused by the Executive's vote or the vote of any assignee of the
Executive) of the holders of a majority of the outstanding Special Preferred
Voting Shares to nominate the Executive for election to the Board of Trustees of
CharterMac as a Managing Trustee (as defined in the Trust Agreement) at any
meeting of the shareholders of CharterMac at which the Executive's term as a
Managing Trustee is scheduled to expire; or (F) the Company's delivery to the
Executive, pursuant to Section 3, of the Company's notice not to extend the term
of this Agreement.
Section 7. Severance.
(a) Termination by the Executive for Good Reason; Termination
by the Company Other Than for Cause, Death or Disability, in Either Case Other
Than in Connection With a Change in Control. If, during the Employment Term, the
Executive terminates his employment with the Company for Good Reason or the
Executive's employment is terminated by the Company without Cause, and such
termination by the Company, or events constituting Good Reason, do not occur in
anticipation of or within one year after a Change in Control, the Company shall
have no liability or further obligation to the Executive except as follows: the
Executive shall be entitled to receive (i) within thirty (30) days of such
termination of employment, any earned but unpaid Base Salary and any accrued car
allowance and expense reimbursement entitlements for the period prior to
termination and any declared but unpaid bonuses for prior periods which have
ended at the time of such termination ("Entitlements"), (ii) any rights to which
he is entitled in accordance with plan provisions under any employee benefit
plan, fringe benefit or incentive plan ("Benefit Rights"), and (iii) severance
compensation equal to twelve (12) months of the Base Salary plus 75% of the
amount of the Executive's most recently declared and paid annual bonus
compensation, payable in a lump sum within thirty (30) days of the date of
termination of employment (the "Severance Pay"). Additionally, medical, dental,
disability and life insurance then provided to senior executives of the Company
shall be continued following the date of termination for a period of twelve (12)
months, or at the discretion of the Company, a cash payment shall be made in
lieu of such benefits. Further, under the terms of the Incentive Plan, any
unvested options awarded to the Executive under the Incentive Plan shall fully
vest upon the date of termination of the Executive. Notwithstanding the
foregoing, the continuation period for group health benefits under Section 4980B
of the Code by reason of the Executive's termination of employment with the
Company shall be measured from his actual date of termination of employment. As
a condition of receiving the Severance Pay under this Section 7(a), the
Executive agrees to execute a release substantially in the form of Exhibit C
releasing the Company and its Affiliates from any and all obligations and
liabilities to the Executive arising from or in connection with the Executive's
employment or termination of
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employment with the Company and its Affiliates and any disagreements with
respect to such employment, except that such release shall not release the
Company from its obligations to pay the Executive the Entitlements, the Benefit
Rights and the Severance Pay provided for in this Section 7(a). If the
Executive's employment is terminated as provided in this Section 7(a) prior to
the first declaration and payment of bonus compensation under this Agreement,
the annual bonus amount used for determining Severance Pay shall be deemed to be
$187,500 (which amount shall not be multiplied by 75% in the Severance Pay
calculation). The deemed bonus compensation referenced in the preceding sentence
is not intended to be indicative of the appropriateness of the amount of bonus
compensation as may be determined from time to time by the Compensation
Committee.
(b) Termination in Anticipation of, or Within One Year After a
Change in Control. If, during the Employment Term, the Executive's employment is
terminated by the Company in anticipation of, or within one year after a Change
in Control (other than as a result of Cause, death or Disability), or by the
Executive for Good Reason within one year after a Change in Control, the Company
shall have no liability or further obligation to the Executive except as
follows: the Executive shall be entitled to receive (i) within 30 days of such
termination of employment, all Entitlements, (ii) all Benefit Rights and (iii)
an amount equal to 200% of the Severance Pay (calculated and payable as provided
in Section 7(a)). Additionally, medical, dental, disability and life insurance
then provided to senior executives of the Company shall be continued following
the date of termination for a period of twelve (12) months, or at the discretion
of the Company, a cash payment shall be made in lieu of such benefits.
Notwithstanding the foregoing, the continuation period for group health benefits
under Section 4980B of the Code by reason of the Executive's termination of
employment with the Company shall be measured from his actual date of
termination of employment. As a condition of receiving the Severance Pay under
this Section 7(b), the Executive agrees to execute a release substantially in
the form of Exhibit C releasing the Company and its Affiliates from any and all
obligations and liabilities to the Executive arising from or in connection with
the Executive's employment or termination of employment with the Company and its
Affiliates and any disagreements with respect to such employment, except that
such release shall not release the Company from its obligations to pay the
Executive the Entitlements, the Benefit Rights and the Severance Pay provided
for in this Section 7(b).
(c) Death; Disability; Non-Election to Continue Employment. If
during the Employment Term, the Executive's employment is terminated due to
death or Disability, or the Executive's employment is terminated on account of
any election by the Executive not to continue the Employment Term for an
Additional Term or Terms, the Company shall have no liability or further
obligation to the Executive except as follows: the Executive (and his estate or
designated beneficiaries under any Company-sponsored employee benefit plan in
the event of his death) shall be entitled to receive: (i) all Entitlements; (ii)
all Benefit Rights; and (iii) solely in the case of the Executive's death or
Disability, a cash payment equal to twelve (12) months of Base Salary plus 75%
of the amount of the Executive's annual bonus compensation.
(d) Termination by the Company for Cause; Termination by the
Executive Without Good Reason. If the Executive's employment is terminated by
the Company for Cause or the Executive terminates employment with the Company
without Good Reason, the Company
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shall have no liability or further obligations to the Executive except as
follows: the Executive shall be entitled to receive (i) all Entitlements and
(ii) all Benefit Rights.
(e) Pension and Benefit Calculations. The payments made
pursuant to this Section 7 shall be excluded from all pension and benefit
calculations under the employee benefit plans of the Company and its Affiliates,
except that Entitlements shall be included in such benefit calculations to the
extent provided in the applicable employee benefit plan.
Section 8. Covenants of the Executive.
(a) Non-Competition. During the period of the Executive's
employment hereunder and for a period of eighteen (18) months thereafter (the
"Non-Competition Period"), the Executive shall not (except when acting for and
on behalf of the Company and its Affiliates), for Executive's own account or for
others, in any capacity, including as an employee, officer, director, trustee,
member, manager, investor, consultant, agent, owner, stockholder or partner,
engage in a Competitive Business anywhere in the United States or its
territories or possessions; provided, however, that in the event the Executive
terminates his employment with the Company for Good Reason or the Executive's
employment is terminated by the Company without Cause (an "Excused
Termination"), the duration of the Non-Competition Period shall be for a period
of twelve (12) months following such termination. As used herein, "Competitive
Business" shall mean arranging for or providing, directly or indirectly, debt
and/or equity financing products or services to developers and owners of
multi-family housing. Without limitation, Competitive Business includes (i) the
Acquired Businesses (as defined in the Contribution Agreement) and any
businesses which have been conducted by the Company or any of the Subject
Entities (as defined in the Contribution Agreement); (ii) any business now or
hereafter conducted by CharterMac, American Mortgage Acceptance Company ("AMAC")
or any of their respective Affiliates; (iii) the syndication and sale of housing
tax credits, historic rehabilitation tax credits, new markets tax credits or
home ownership tax credits ("Tax Credits"), (iv) the syndication and sale of
real estate developments which have been allocated Tax Credits ("Tax Credit
Properties") or direct or indirect ownership interests in partnerships, limited
liability companies or other entities that have been formed to provide a
pass-through of Tax Credits and tax losses from Tax Credit Properties ("Tax
Credit Syndication Interests"), (v) the acquisition of Tax Credits or Tax Credit
Syndication Interests through tender offers or other methods, (vi) providing
credit enhancement by insurance, credit support, guaranties or otherwise with
respect to tax-exempt bond financing for multi-family housing, (vii) the
business of guaranteeing a specified internal rate of return in connection with
the sale of Tax Credit Syndication Interests, (viii) providing bridge lending,
mezzanine lending, pre-development lending, financial guarantees, default swaps,
credit derivative products or other derivative products in connection with Tax
Credit Properties or Tax Credit Syndication Interests and (ix) co-development of
Tax Credit Properties.
(b) During the period of (i) five (5) years from the date
hereof and, (ii) if greater, the period of eighteen (18) months following the
termination of the Executive's employment hereunder (or twelve (12) months in
the case of an Excused Termination), the Executive shall not, directly or
indirectly, hire or solicit for hire, for the account of the Executive or any
other person or entity, any person who is or was an employee of the Company or
any Affiliate of the Company to work in a Competitive Business (other than any
secretary to the Executive) so long as such person is an employee of the Company
or any of its Affiliates and for
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a period of 180 days after such person has ceased to be an employee of the
Company or any of its Affiliates.
(c) During the period of eighteen (18) months following the
termination of the Executive's employment hereunder (or twelve (12) months in
the case of an Excused Termination), the Executive shall not, directly or
indirectly, alone or with others contact, solicit or do business of any kind in
any Competitive Business with, or assist any other person to contact, solicit or
do business of any kind in any Competitive Business with, any person who, during
the two-year period preceding the date of the Executive's termination of
employment, sold or developed, or owned an interest in, a Tax Credit Property or
a Tax Credit Syndication Interests sponsored by CCC or any of its Affiliates.
(d) Confidential Information. For the Employment Term and
thereafter: (i) the Executive will not divulge, transmit or otherwise disclose
(except as legally compelled by court order, and then only to the extent
required, after prompt notice to the Company of any such order), directly or
indirectly, other than in the regular and proper course of business of the
Company, any confidential knowledge or information with respect to the
operations, finances, organization or employees of the Company or its Affiliates
or with respect to confidential or secret processes, services, techniques,
customers or plans with respect to the Company or its Affiliates (collectively,
"Confidential Information"); and (ii) the Executive will not use, directly or
indirectly, any Confidential Information for the benefit of anyone other than
the Company or its Affiliates; provided, however, that Confidential Information
shall not be deemed to include any information that (A) is or hereafter becomes
generally available to the public other than through disclosure by the
Executive, (B) is rightfully received by the Executive following the Employment
Term from a third party or (C) is brought by the Executive to his employment
relationship with the Company. All files, records, correspondence, memoranda,
notes or other documents (including, without limitation, those in
computer-readable form) or property relating or belonging to the Company or its
Affiliates, whether prepared by the Executive or otherwise coming into his
possession in the course of the performance of his services under this
Agreement, shall be the exclusive property of Company and shall be delivered to
Company and not retained by the Executive (including, without limitation, any
copies thereof) upon termination of the Executive's employment with the Company
for any reason whatsoever.
(e) Inventions and Patents. The Executive agrees that all
processes, technologies and inventions, including new contributions,
improvements, ideas and discoveries, together with all products and proceeds of
the Executive's services hereunder, including, but not limited to, all
materials, ideas, concepts, formats, suggestions, developments, arrangements,
packages, programs and other intellectual properties that the Executive may
acquire, obtain, develop or create in connection with and during his employment,
whether patentable or not, conceived, developed, invented or made by him during
his employment by the Company (collectively, "Inventions") shall belong
exclusively to the Company, provided that such Inventions grew out of the
Executive's work with the Company or any of its Affiliates, are related to the
business (commercial or experimental) of the Company or any of its Affiliates or
are conceived or made on the Company's time or with the use of the Company's
facilities or materials. The Executive shall promptly disclose such Inventions
to the Company and shall, subject to reimbursement by the Company for all
reasonable expenses incurred by the Executive in connection therewith: (i)
assign to the Company, without additional compensation, all patent
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and other rights to such Inventions for the United States and foreign countries;
(ii) sign all papers necessary to carry out the foregoing; and (iii) give
testimony in support of the Executive's inventorship. The provisions of this
Section 8(e) shall cease to have application to any Inventions that become known
to the public other than through disclosure by the Executive and that are not
subject to a copyright, patent or trademark in favor of the Company that (A) was
received before the termination of the Executive's employment or (B) was applied
for before the termination of the Executive's employment in the ordinary course
of business (and not in anticipation of the Executive's termination of
Employment) and ultimately is received by the Company.
(f) Disparagement. The Company and the Executive agree that,
during the Employment Term and thereafter (including following the Executive's
termination of employment for any reason) neither the Company or its Affiliates
or their respective employees, officers, trustees or directors, on the one hand,
or the Executive, on the other, will make statements or representations, or
otherwise communicate, directly or indirectly, in writing, orally, or otherwise,
or take any action which may, directly or indirectly, disparage the other or
their respective officers, trustees, directors, employees, advisors, businesses
or reputations. Notwithstanding the foregoing, nothing in this Agreement shall
preclude the Executive or a representative of the Company or its Affiliates from
making truthful statements or disclosures that are required by applicable law,
regulation or legal process.
(g) Remedies.
(i) The Executive acknowledges that a material breach of
his covenants contained in this Section 8 will cause irreparable damage to the
Company and its Affiliates, the exact amount of which will be difficult to
ascertain, and that the remedies at law for any such material breach will be
inadequate. Accordingly, the Executive agrees that if he breaches any of the
covenants contained in this Section 8 in any material respect, in addition to
any other remedy which may be available at law or in equity, the Company shall
be entitled to specific performance and injunctive relief.
(ii) The Company and the Executive further acknowledge
that the time, scope, geographic area and other provisions of this Section 8
have been specifically negotiated by sophisticated commercial parties and that
the covenants contained in this Section 8 are entered into in connection with a
sale to the Company of an interest in a business engaged in by the Executive
prior to the date of this Agreement and agree that all such provisions are
reasonable under the circumstances of the activities contemplated by this
Agreement. In the event that the agreements in this Section 8 shall be
determined by any court of competent jurisdiction to be unenforceable by reason
of their extending for too great a period of time or over too great a
geographical area or by reason of their being too extensive in any other
respect, they shall be interpreted to extend only over the maximum period of
time for which they may be enforceable and/or over the maximum geographical area
as to which they may be enforceable and/or to the maximum extent in all other
respects as to which they may be enforceable, all as determined by such court in
such action.
(h) Cooperation. The Executive agrees to cooperate with the
Company, during the Employment Term and thereafter (including following the
Executive's termination of
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employment for any reason), by making himself reasonably available to testify on
behalf of the Company or any of its Affiliates in any action, suit, or
proceeding, whether civil, criminal, administrative, or investigative, and to
assist the Company, or any Affiliate, in any such action, suit, or proceeding,
by providing information and meeting and consulting with the Board or its
representatives or counsel, or representatives or counsel to the Company, or any
Affiliate as reasonably requested; provided, however that the same does not
materially interfere with his then current professional activities or important
personal activities and is not contrary to the best interests of the Executive.
The Company agrees to reimburse the Executive, on an after-tax basis, for all
reasonable expenses actually incurred in connection with his provision of
testimony or assistance and, with respect to the provision of testimony or
assistance following the Employment Term, to pay the Executive reasonable per
diem costs for such testimony or assistance.
(i) Non-Circumvention. The Executive covenants that the
Executive will not engage in activities, or utilize any of the exceptions to the
covenants contained in this Section 8, in a manner intended to circumvent the
Executive's obligations under this Section 8.
Section 9. Interests.
(a) Acquisition of Interests. Upon request of the Company, the
Executive (or, at the Executive's option, an Affiliated Entity) shall acquire
and hold Interests (as defined below) on terms reasonably acceptable to the
Company and the Executive. Prior to transferring any Interest, the Executive
shall afford the Company the right to acquire the Interest proposed to be
transferred on the terms described in this Section 9, and the Company shall,
within 30 days of written notice from the Executive of his intention to transfer
an Interest, inform the Executive whether it or its designee will acquire such
Interest (in which case such Interest shall be acquired within 30 days
thereafter). The amount payable by the Company or its designee for any such
Interest shall be the fair market value as determined in accordance with Section
9(c). Twenty percent of the purchase price for such Interest shall be paid by
the Company or its designee in cash upon the transfer of such Interest and the
remainder shall be paid with the issuance by the Company of a recourse
promissory note, secured by the Interest sold, bearing interest at the Interest
Rate (as defined below), with interest payable annually in arrears and the
principal of such note payable in six equal installments on the first, second,
third, fourth, fifth and sixth anniversaries of the transfer.
(b) Further Assurances. In the case of any transfer of an
Interest to the Company or its designee in accordance with Section 9(a), the
Executive shall at any time and from time to time upon request by the Company
take or cause to be taken any action and shall execute and deliver any
additional documents which in the opinion of the Company, reasonably exercised
in its sole discretion, may be necessary in order to assure to Company or its
designee the full benefits of this Agreement; provided, however, that no action
or additional documents shall be required that would extend or expand upon the
obligations of the Executive hereunder or require the Executive to make any
representations, warranties, covenants or indemnifications, except with respect
to the Executive's title to the Interests.
(c) Determination of Fair Market Value of Interests. The
Executive and Company shall attempt to agree on the fair market value of any
Interest to be transferred to the
10
Company or its designee in accordance with Section 9(a). If they cannot reach
agreement on the fair market value of such Interest, the following arbitration
methodology shall apply:
(i) The Executive and the Company shall select a mutually
acceptable appraiser who shall determine the fair market value of the Interest.
In the event the parties are unable to agree upon an appraiser or if either
party disputes the results of the appraisal, the Executive and the Company shall
each select an appraiser and paragraphs (ii)-(iv) shall apply.
(ii) If the difference between the two appraisals is less
than or equal to ten percent (10%) of the lower of the two appraisals, the fair
market value shall be the average of the two appraisals.
(iii) If the difference between the two appraisals is
greater than ten percent (10%) of the lower of the two appraisals, then the two
appraisers shall jointly select a third appraiser. The third appraiser shall be
instructed and directed to select one of the two appraisals, which selection
shall then become final and binding upon the parties.
(iv) The Executive and the Company shall share the cost
equally of any appraiser jointly selected or shall pay the costs of the
appraiser they each select and shall share the cost equally of any third
appraiser.
(v) An Interest shall be valued assuming the assets of the
entity in which the Interest represents an ownership interest are sold in an
orderly manner, the liabilities of such entity are satisfied, and the net amount
is distributed in liquidation of the entity.
(d) Definitions. For purposes of this Section 9:
(i) "Affiliated Entity" means an entity of which Executive
is an equity owner.
(ii) "Interest" means an ownership interest in an entity,
including, without limitation, an Affiliated Entity (other than CCC or
CharterMac), that (a) is involved in, or related to, any business activity of
CharterMac or any of its subsidiaries or Affiliates and (b) was acquired at the
request of the Company pursuant to this Section 9; provided that (x) the
Executive shall have no personal liability from the ownership of the Interest
and no obligations under the governing documents relating to the Interest which
could subject the Executive to personal liability or require the Executive to
make any contributions other than the Executive's initial capital contribution
to acquire the Interest and (y) no amendment shall be made to the governing
documents agreed to by the Company and the Executive upon acquisition of the
Interest which increases the liabilities or obligations of the Executive without
the consent of the Executive.
(iii) "Interest Rate" means one percentage point in excess
of the "prime" rate established from time to time by Citibank, NA, but in no
event shall exceed twelve (12%) percent per annum.
11
(e) Successors and Assigns. Without limiting the rights of any
party contained elsewhere in this Agreement, the provisions of this Section 9
shall be binding on the Executive's successors and permitted assigns.
Section 10. Miscellaneous.
(a) Notices. All notices and other communications given or made
pursuant hereto shall be in writing and delivered by hand or sent by registered
or certified mail (postage prepaid, return receipt requested) or by nationally
recognized overnight air courier service and shall be deemed to have been duly
given or made as of the date delivered if delivered personally, or if mailed, on
the third business day after mailing (on the first business day after mailing in
the case of a nationally recognized overnight air courier service) to the
parties at the following addresses:
If to the Executive:
Xxxxxx X. Xxxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to:
Xxxxx Raysman Xxxxxxxxx Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
If to the Company:
Related Capital Company LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to:
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxxx, Esq.
(b) Amendment and Modification. This Agreement may be modified,
amended or supplemented only by an instrument in writing signed by all of the
parties hereto (which, in the case of the Company, shall require the approval of
not less than a majority of the independent trustees of CharterMac).
(c) Waiver of Compliance. Except as otherwise provided in this
Agreement, any failure of any of the parties to comply with any obligation,
covenant, agreement or condition herein may be waived by the party or parties
entitled to the benefits thereof only by a written
12
instrument signed by the party granting such waiver (which, in the case of a
waiver by the Company, shall require the approval of not less than a majority of
the independent trustees of CharterMac), but such waiver or failure to insist
upon strict compliance with such obligation, covenant, agreement or condition
shall not operate as a waiver of, or estoppel with respect to, any subsequent
other failure.
(d) Governing Law. This Agreement shall be governed by the laws
of the State of New York without regard to the conflict of principles thereof.
(e) Severability. The invalidity or unenforceability of any
provisions of this Agreement in any such jurisdiction shall not affect the
validity, legality or enforceability of the remainder of this Agreement in such
jurisdiction or the validity, legality or enforceability of this Agreement,
including any such provision, in any other jurisdiction, it being intended that
all rights and obligations of the parties hereunder shall be enforceable to the
fullest extent permitted by law. Upon such determination that any provision is
invalid, illegal or incapable of being enforced, the parties hereto will
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that the transactions contemplated hereby and thereby are fulfilled to the
extent possible.
(f) Arbitration.
(i) The parties shall use their reasonable best efforts
and goodwill to settle all disputes by amicable negotiations. The Company and
the Executive agree that any dispute, controversy or claim arising out of,
relating to or in connection with this Agreement, or the termination of this
Agreement or the termination of the Executive's employment hereunder that is not
amicably resolved by negotiation shall be finally settled by arbitration, under
and in accordance with the Rules of Employment Arbitration of the American
Arbitration Association then in effect, as set forth below, in New York, New
York, or such other place agreed to by the parties.
(ii) Any such arbitration shall be heard before a single
impartial arbitrator who shall be appointed in accordance with American
Arbitration Association procedures.
(iii) The award of the arbitrator shall be in writing and
state the reasons upon which it is based. It may be made public only with the
consent of the parties. Any monetary award shall be in U.S. dollars.
(iv) Each of the parties hereto accepts the exclusive
jurisdiction of the arbitrator appointed in accordance herewith. The award of
the arbitrator shall be final and binding on the parties, who undertake to carry
it out without delay. Judgment on the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof.
(v) The arbitrator may also award interim relief and grant
specific performance. Notwithstanding the foregoing, each party reserves the
right to apply to any court of competent jurisdiction for any provisional
measure, including injunctive relief, to enforce the terms of this Agreement.
13
(vi) The party against whom the arbitrator awards shall
pay all costs of the arbitrator and of the American Arbitration Association.
(vii) The Arbitrator shall be empowered to award damages
and provide remedies to the same extent as would be available from a court of
competent jurisdiction at law or in equity; provided, however, that the
arbitrator shall have no power or authority to award punitive or special
damages.
(g) Assignability. The Executive may not assign his interest in
or delegate his duties under this Agreement. This Agreement is for the
employment of the Executive, personally, and the services to be rendered by him
under this Agreement must be rendered by him and no other person. The Executive
represents and warrants to the Company that the Executive has no contracts or
agreements of any nature that the Executive has entered into with any other
person, firm or corporation that contain any restraints on the Executive's
ability to perform his obligations under this Agreement. This Agreement shall be
binding upon and inure to the benefit of the Company and its successors and
assigns. Notwithstanding anything else in this Agreement to the contrary, the
Company may assign this Agreement to and all rights hereunder shall inure to the
benefit of any Affiliate of the Company or any person, firm or corporation
resulting from the reorganization of the Company or succeeding to the business
or assets of the Company by purchase, merger or consolidation. Nothing in this
Agreement, express or implied, is intended to or shall confer upon any other
person any right, benefit, claim or remedy of any nature whatsoever under or by
reason of this Agreement.
(h) Compliance with Rules and Policies. The Executive shall
perform all services in accordance with the applicable policies, procedures and
rules established by the Company or CharterMac. In addition, the Executive,
shall comply with all laws, rules and regulations that are generally applicable
to the Company, its Affiliates and their employees, trustees, directors and
officers.
(i) Withholding. The Company shall withhold from all amounts
due hereunder any applicable withholding taxes payable to federal, state, local
or foreign taxing authorities.
(j) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(k) Section Headings. The section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties and shall not in any way affect the meaning or interpretation of
this Agreement. All references in this Agreement to Sections are to sections of
this Agreement, unless otherwise indicated.
(l) Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof,
supersedes all prior agreements and undertakings, both written and oral, and may
not be modified or amended in any way except in writing by the parties hereto.
14
(m) Duration. Notwithstanding the Employment Term hereunder,
the applicable sections of this Agreement shall continue for so long as any
obligations remain under this Agreement.
(n) Survival. The provisions of Sections 4(c), 7, 8, 10(f) and
10(p) of this Agreement shall survive and shall continue to be binding upon the
Executive and the Company notwithstanding the termination of this Agreement for
any reason whatsoever.
(o) Interpretation.
(i) The parties hereto have participated jointly in the
negotiation and drafting of this Agreement. If any ambiguity or question of
intent or interpretation arises, this Agreement will be construed as if drafted
jointly by the parties and no presumptions or burden of proof will arise
favoring or disfavoring any party by virtue of authorship of any provisions of
this Agreement.
(ii) All pronouns and any variations thereof refer to the
masculine, feminine or neuter, singular or plural, as the context may require.
(iii) The words "include," "includes" and "including"
shall be deemed to be followed by the phrase "without limitation."
(p) Indemnification and D&O Insurance. The Company shall, or
shall cause its Affiliates to, indemnify the Executive and provide Executive
with the advancement of expenses to the fullest extent provided for like senior
executives providing services for the Company or its Affiliates. During the
Employment Term, the Company shall maintain, or shall cause any Affiliate for
whom the Executive provides services at the request of the Company to maintain,
directors' and officers' insurance coverage in an amount not less than $15
million, provided that such coverage can be obtained at rates that the Company
reasonably determines are not cost prohibitive.
Section 11. Legal Fees. The Company shall reimburse the Executive for
the Executive's reasonable legal expenses incurred in negotiating the terms of
this Agreement in an amount not to exceed $2,500.
[SIGNATURE PAGE FOLLOWS]
15
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above.
RELATED CAPITAL COMPANY LLC
By: CharterMac Corporation, as managing member
By: /s/ Xxxx X. Xxxxxx
---------------------------------
Name: Xxxx X. Xxxxxx
Title: Chief Operating Officer
EXECUTIVE
/s/ Xxxxxx X. Xxxxxx
-------------------------------------------
Xxxxxx X. Xxxxxx
By its signature below, CharterMac, a Delaware statutory trust ("CharterMac"),
guarantees to the Executive the payment and performance of the Company's
obligations pursuant to Sections 4, 7, 10(p) and 11 of this Agreement, and
CharterMac hereby waives the benefits of diligence, presentment, demand of
payment, any requirement that the Executive exhaust any right or take any action
against the Company or any other person or entity, the filing of claims with a
court in the event of insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest or notice with respect
to such guaranteed obligations and all demands whatsoever.
CHARTERMAC
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Chief Operating Officer
16
Exhibit A
Description of Executive's Duties and Functions - ss.1
------------------------------------------------------
TITLES:
Chief Executive Officer - CharterMac and all CharterMac Affiliates and
subsidiaries (except for the Company)
Managing Director - the Company
DUTIES AND FUNCTIONS:
As a member of the Board and the Operating Committee of the Company established
by the Board and CEO of CharterMac and each of its Affiliates and subsidiaries
(except the Company), and Managing Director of the Company, the Executive will
be the executive primarily responsible for the following as it relates to
CharterMac and all of its Affiliates and subsidiaries (except the Equity
Business1): strategic planning, new product development, annual business
planning and budgeting, banking relationships, investment banking relationships
(other than tax credit warehouse lines), capital markets activity, CharterMac's
balance sheet, investor services (other than for tax credit investors),
communications with analysts and investors, managing all debt product
development and originations, including credit policy and pricing, and serving
as Chairman of PW Funding and Chairman and CEO of AMAC. The following
departments will report directly to the Executive: all of PW Funding, debt
originations, loan servicing and construction loan servicing, investor services
(with respect to CharterMac, AMAC), CharterMac's CFO, capital markets and
research and special projects. The Executive reports solely to the Board and the
Operating Committee. In addition, the Executive will be offered a position on
each committee of the Company and CharterMac and their Affiliates and
subsidiaries formed from time to time as may generally be offered to other
senior executives of the Company (subject to regulatory or corporate governance
restrictions).
See Schedule I, attached hereto.
The Executive shall be a direct report to the Operating Committee of the
Company. Subject to the authority of the Board of Trustees of CharterMac, the
Operating Committee shall be vested with general responsibility for the ordinary
and usual management of the business and affairs of the Company. The Executive
shall have the right to serve as a member of the Operating Committee. The other
initial members of the Operating Committee shall be Xxxx X. Xxxxxx, Xxxxxx X.
Xxxxx, Xxxx X. Xxxxxxxxx, Xxxxxxx Xxxx, Xxxx Xxxx, Xxxxxxx Xxxxxxx and Xxxxxx
Xxxxxxxxx. Each member of the Operating Committee shall have one vote. In the
event of any
----------------------
1 The Equity Business currently includes: (i) the acquisition of
properties that generate low-income housing or historic rehabilitation
tax credits, (ii) the syndication of non-guaranteed and guaranteed tax
credit funds to corporate investors, (iii) the management of the
business and reporting to investors in corporate tax credit funds, (iv)
the provision of consulting services to clients in connection with HUD
programs and housing preservation, (v) in-house construction supervision
of all projects acquired by corporate tax credit funds, and (vi) the
processing of post-closing equity installments due to project
developers.
significant disagreements at the Operating Committee level, the matter shall
be referred to the Board of Trustees of CharterMac for resolution.
The existence of the Operating Committee does not in any way alter, amend,
modify or change the primary responsibility of the Executive, or the authority
of the Executive with regard to his direct reports, within the scope of the
Executive's field of responsibility as set forth in the above job description.
Further, the Operating Committee shall not have the right or power to diminish
the Executive's duties or responsibilities as set forth in the above job
description.
2
Schedule I to
Exhibit A
---------
o The Board will confirm in writing that, notwithstanding the titles of CEO
and President of CharterMac, it views the two positions at an equivalent
level in the organizational structure, with equal authority, rights,
compensation and standing. Notwithstanding this statement, each executive
will have the distinct and separate rights and authorities with regard to
his specific responsibilities described in the Employment Agreement and
nothing contained in this statement in any way alters, amends or modifies
the job description in the executive's Employment Agreement. Such written
confirmation will be read into minutes of the first Board meeting following
the closing of the Project Timex transaction.
o The President of CharterMac (subject to input from the other members of the
management team and approval of the Operating Committee) will have authority
over the business plan, staffing and budget for the Equity Business.
o The President of CharterMac (subject to input from the other members of the
management team and approval of the Operating Committee) will have authority
over the use of the tax credit warehouse line of credit.
o Both the CEO and President of CharterMac will sign the CharterMac's annual
and quarterly report and all reports to investors signed by the CEO of the
Company shall also be signed by the CEO of CharterMac.
o Any press releases, announcements (including internal company wide policy
announcements to employees), organizational charts, electronic
communications, or company web site descriptions of the Project Timex
transaction or the management structure of CharterMac, will state that
CharterMac is managed by Kiley, Hirmes, Schnitzer and Boesky, in no
particular order, and organization charts will depict the four individuals
on the same physical level. The CEO and President of CharterMac will both
participate in any "road show" organized to promote the Project Timex
transaction to institutions (including the Company LIHTC investors) and
shareholders.
o Press opportunities will be handled by the Company or CharterMac executive
that in the opinion of the Operating Committee will be the best
representative of CharterMac for the specific opportunity taking into
consideration the intended audience and the matter to be discussed.
o Any external press releases or internal announcements disclosing the Project
Timex transaction will contain quotes from both the current CEO of
CharterMac and its incoming President.
o Any directory or other listings for CharterMac that require contact
information will list both the CEO and President. If the listing contains a
photograph of the "head" of the company, photographs for both the CEO and
President will be provided. This provision shall apply equally to any
directories or listings in which one of CharterMac's subsidiaries is to
appear.
3
o Any employee communications concerning company-wide policy will come from
the Operating Committee. Any company-wide policies will be decided and
implemented by the Operating Committee, subject to Board approval if
necessary.
o The CEO and President of CharterMac together will prepare the agenda for
Board meetings. Both parties will participate in presentations and regular
business updates to the Board. The President will make any presentations to
the Board pertaining to the Equity Business.
o The CEO and President will have equal votes and rights on the Operating
Committee and any other committee in which they both participate. Neither
party will possess any veto rights or non-proportional voting rights.
Initially, the CEO of CharterMac will sit on all debt approval committees
and the President of CharterMac will sit on all equity approval committees.
Subject to Xxxxxx Mae's approval, it is CharterMac's intention that the CEO
and President will have the rights to sit on all debt and equity approval
committees.
o The CEO of CharterMac (subject to input from the other members of the
management team and approval of the Operating Committee) will be responsible
for credit policy and pricing on debt products, and the President of
CharterMac (subject to input from the other members of the management team
and approval of the Operating Committee) will be responsible for credit
pricing for the Equity Business.
4
Exhibit B
---------
Description of Employee Benefits - ss.4(c)
------------------------------------------
The employee benefits shall be no less favorable then those
provided to the Executive by the Company during the twelve-month period
preceding the Effective Date. In addition, the Executive shall receive the
following benefits:
1. Life Insurance/Disability as follows:
Employer Employee
Monthly Monthly Monthly
Benefit Coverage Premium Cost Contribution
------- -------- ------- ---- ------------
Life Insurance 250,000 29.25 29.25 0.00
Life Insurance Optional 250,000 59.50 0.00 59.50
Long Term Disability 5000 33.33 33.33 0.00
Short Term Disability 0 5.98 5.98 0.00
Supplemental LTD 10,000 40.00 0.00 40.00
Note: Supplemental LTD coverage supersedes LTD coverage. Do not add together.
---
2. Federal, state and local income tax return preparation.
Exhibit C
---------
Form of Release
---------------
GENERAL RELEASE
---------------
It hereby is agreed, by and among Related Capital Company LLC, a
Delaware limited liability company (the "Company"), and _____________ (the
"Executive"), as follows: ------- ---------
1. [The Executive submits, and the Company accepts, [his/her]
permanent resignation from employment effective ________________] [The
Company requests and the Executive submits to [his/her] termination from
employment effective ______________]. The Executive hereby waives any and
all rights or claims to reinstatement or reemployment by the Company. The
Company reaffirms its obligation to provide the benefits and make the
payments required pursuant to Sections 7 and 10(p) of that certain
Employment Agreement dated as of November 17, 2003 between the Company and
the Executive (the "Employment Agreement"). CharterMac, by its execution of
this Release, guarantees the foregoing obligations of the Company to the
same extent of its guaranty of the obligations of the Company under the
Employment Agreement.
2. In consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged by the
Executive, the Executive, for [his/her] self, [his/her] heirs, executors,
administrators, successors and assigns, hereby releases and forever
discharges the Company, including any and all of the Company's subsidiaries,
parents, affiliates or related business entities, its or their past, present
and future owners, partners, directors, officers, agents, representatives,
and employees or any of its or their subsidiaries, parents, affiliates or
related business entities, and its or their respective heirs, executors,
administrators, successors and assigns, of, from and/or for all manner of
actions, proceedings, causes of action, suits, debts, sums of money,
accounts, contracts, controversies, agreements, promises, damages,
judgments, claims, and demands whatsoever, known or unknown, whether arising
in law or equity, out of any federal, state or city constitution, statute,
ordinance, bylaw or regulation, or under the Employment Agreement, arising
out of or relating to the Executive's employment by the Company, including
but not limited to the termination of such employment, all claims of
discrimination on the basis of age, alienage, citizenship, creed,
disability, gender, handicap, marital status, national origin, race,
religion, sex or sexual orientation, and, without limitation, any claims
arising under Title VII of the Civil Rights Act of 1964, the Age
Discrimination in Employment Act, the Equal Pay Act, the Rehabilitation Act,
the Americans With Disabilities Act, the New York State Human Rights Law,
the New York City Human Rights Law, and any other federal, state or local
statute, ordinance, rule, regulation or order (collectively, "Claims or
Damages"), which the Executive ever had, now has, or which [he/she], or
[his/her] heirs, executors, administrators, successors or assigns can or may
have for, or by reason of, any matter, cause, event, act, omission,
transaction or occurrence up to and including the date of the execution of
this Release, arising out of or relating to Executive's employment by the
Company, including but not limited to the termination of such employment.
For the
avoidance of doubt, this Release shall not extend to (i) claims
arising out of the Company's failure to perform its obligations under
Sections 7 and 10(p) of the Employment Agreement, including claims for
Entitlements, Benefits Rights and Severance Pay as such terms are defined in
Section 7, (ii) claims against CharterMac for failing to perform its
guarantee obligations as set forth in the Employment Agreement and this
Release or (iii) claims to enforce this Release or (iv) the Executive's
rights as a holder of Common Shares of CharterMac or Special Common Units of
CCC or the Executive's rights or benefits not relating to employment under
the Contribution Agreement.
3. The Company, for itself, its successors, assigns and legal
representatives, hereby releases and forever discharges the Executive, and
the Executive's heirs, executors, administrators, legal representatives and
assigns, from and against any and all Claims or Damages which the Company
ever had, now has for, or by reason of, any matter, cause, event, act,
omission, transaction or occurrence up to and including the date of the
execution of this Release, arising out of or relating to Executive's
employment by the Company; provided, however, that the Company is not
releasing any claims ("Retained Claims") arising out of intentionally
improper acts by the Executive or any fraudulent, unauthorized or illegal
acts by the Executive, with the understanding that the Company is not
currently aware of any such acts; and provided further that any Retained
Claims that are not brought in a legal proceeding against the Executive
within eighteen (18) months following the date of this Release shall be
deemed released and forever discharged from and after the date which is
eighteen months following the date of this Release.
4. (a) Except with respect to amounts or benefits owed pursuant
to Sections 7 and 10(p) of the Employment Agreement, and to the extent not
prohibited by law, the Executive covenants not to in any way cause to be
commenced or prosecuted, or to commence, maintain or prosecute any action,
charge, complaint or proceeding of any kind, on his own behalf or as a
member of any alleged class of persons, in any court or before any
administrative or investigative body or agency (whether public, quasi-public
or private), against the Company, or any of its subsidiaries, parents,
affiliates, related business entities, or their respective successors or
assigns, or any individual now or previously employed by the Company, or by
any of its subsidiaries, parents, affiliates, or related business entities
and their successors and assigns, with respect to any act, omission,
transaction or occurrence up to and including the date of this Release
relating to the Executive's employment with the Company or the termination
of [his/her] employment.
(b) The Executive further represents that [he/she] has not
commenced, maintained, prosecuted or participated in any action, charge,
complaint or proceeding of any kind (on [his/her] own behalf and/or on
behalf of any other person and/or on behalf of or as a member of any alleged
class of persons) that is presently pending in any court, or before any
administrative or investigative body or agency (whether public,
quasi-public, or private), against or involving the Company, or any of the
Company's subsidiaries, parents, affiliates, or related business entities,
or their successors or assigns or any individual now or previously employed
by the Company, or by any of its subsidiaries, parents, affiliates, or
related business entities or their successors and assigns relating to the
Executive's employment with the Company or the termination of [his/her]
employment.
2
(c) The Company covenants not to in any way cause to be commenced
or prosecuted, or to commence, maintain or prosecute any action, charge,
complaint or proceeding of any kind in any court or before any
administrative or investigative body or agency (whether public, quasi-public
or private), against the Executive with respect to any act, omission,
transaction or occurrence up to an including the date of this Release
relating to the Company's employment of the Executive or the termination of
[his/her] employment; provided, however, that the Company is not waiving and
shall not waive such right with respect to any act or failure to act by the
Executive that constitutes bad faith, gross negligence, willful misconduct
or any unlawful act. [As of the date of this Release, the Company is not
aware of any act or failure to act by the Executive that would give rise to
any action, charge, complaint or proceeding of any kind in any court or
before any administrative or investigative body or agency (whether public,
quasi-public or private), against the Executive.]2
(d) The Company represents that it has not commenced, maintained,
prosecuted or participated in any action, charge, complaint or proceeding of
any kind that is presently pending in any court, or before any
administrative or investigative body or agency (whether public,
quasi-public, or private), against or involving the Executive or relating to
the Executive's employment with the Company or the termination of [his/her]
employment.
5. The Executive acknowledges that he has been fully and fairly
represented throughout his employment by the Company including the
negotiation of this Release, the terms of which have been explained to him.
6. The Executive acknowledges that he has considered fully the
terms of this Release before signing; that he has read this Release in its
entirety and understands its terms; that he agrees to all terms and
conditions contained herein; that he is signing this Release knowingly and
voluntarily; and, that he intends to abide by its terms in all respects.
7. This Release shall be construed and enforced in accordance
with the laws of the State of New York without regard to the conflict of
principles thereof. Any action to enforce this Release shall be brought in
the New York State Supreme Court, County of New York. The parties hereby
consent to such jurisdiction.
8. This Release may be executed in more than one counterparts,
each of which shall be deemed an original, but all of which shall constitute
one and the same instrument.
EXECUTIVE
--------------------------- --------------------------------
--------------------------
2 This bracketed sentence will be included in the Release if at the time of the
execution of the Release, the Company is able to make such statement. If at that
time the Company is not able to make such statement, the Release must be
executed without such sentence.
3
Date
Signed before me this
day of , [Year]
----- --------------
Notary Public
RELATED CAPITAL COMPANY LLC
By: CharterMac Corporation, as member
By:
----------------------------- -----------------------------
Date Name:
Title:
Signed before me this
day of , [Year]
------ -------------
Notary Public
Consented To/Agreed:
CharterMac
By:
---------------------------
Name:
Title:
[This Release is to be modified if at time of execution the Executive is subject
to the protections of the Older Workers Benefit Protection Act or similar
legislation.]
4
