EMPLOYMENT AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into effective
November 17, 1997, by and between ATLANTIC GULF COMMUNITIES CORPORATION, a
Delaware corporation with its principal office located at 0000 Xxxxx Xxxxxxxx
Xxxxx, Xxxxx, Xxxxxxx 00000 (the "Company"), and XXXX XXXXXXXXX (the
"Employee").
RECITALS
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A. The Company is engaged in, among other things, the acquisition,
development and sale of real estate, and the management of various assets,
including a portfolio of receivables resulting from the sale of real estate.
B. The Company desires to employ the Employee as its Executive Vice
President - Chief Operating Officer under terms which are competitive in the
industry and which will provide the proper incentives to yield the maximum
benefit to the Company and its stockholders.
C. The Employee desires to enter into employment with the Company under
the terms of this Agreement.
AGREEMENT
---------
The Company and the Employee (individually, a "Party"; collectively,
the "Parties"), in consideration of the promises and mutual covenants herein set
forth, agree as follows:
1. EMPLOYMENT. The Company hereby employs the Employee, and the
Employee hereby accepts such employment, to serve as the Executive Vice
President - Chief Operating Officer under the terms of this Agreement.
2. DUTIES AND PERFORMANCE. The Employee shall serve as the Executive
Vice President - Chief Operating Officer of the Company, and shall perform such
executive and administrative services as are generally expected of a corporate
Executive Vice President - Chief Operating Officer, or as may reasonably be
assigned to him from time to time by the Company's president (the "President"),
board of directors (the "Board") or Compensation/ Stock Option Committee (the
"Compensation Committee"). The Employee shall report directly to the President.
The Employee agrees to devote his full business time, attention, energy, and
skill to the Company's business and goodwill and to perform diligently and to
the best of his ability to serve the Company's interests. Notwithstanding the
above, the Company acknowledges that the Employee has certain duties (including,
without limitation, attendance at a trial for approximately two (2) weeks) as
the liquidating trustee of Xxxxxxxx Investment Group, Incorporated, pursuant to
orders issued in Case No. CI 00-000,
Xxxxxxx Xxxxx of the Ninth Judicial Circuit in and for Osceola County, Florida,
and shall be entitled to perform such duties as required and to accept such
compensation as is paid for the performance of such duties until such time as
the Employee is dismissed by the court of applicable jurisdiction from the
Employee's duties as liquidating trustee. Employee represents to the Company
that the Employee's performance of his duties as liquidating trustee shall not
have a material, adverse effect on the performance of Employee's duties under
this Agreement.
3. TERM OF AGREEMENT. The term of the Employee's employment hereunder
shall commence on November 17, 1997, and continue until 5:00 p.m. November 17,
2001, unless earlier terminated pursuant to Section 9 below.
4. COMPENSATION.
a. The Company shall pay to the Employee, as compensation for his
services hereunder, a salary at the rate of $300,000.00 per annum ("Base
Compensation"), payable biweekly in accordance with the Company's general
policies and procedures for payment of salaries to its executive officers.
b. In addition to the Base Compensation, the Employee shall be
eligible for an annual bonus based upon Employee and Company performance (the
"Performance Bonus") of up to 100% of his Base Compensation. The Employee's
ability to earn a Performance Bonus shall be determined based upon objectives
and other criteria set by the President and approved by the Board or
Compensation Committee, as applicable, in consultation with the Employee. Fifty
percent (50%) of the Performance Bonus shall be payable in cash, and at the
Company's option, fifty percent (50%) of the Performance Bonus may be paid in
shares of the Company's common stock based upon the fair market value per share
at the close of business on the day immediately preceding the date of the
payment of the Performance Bonus; provided however that to the
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extent that any portion of the Performance Bonus is paid in stock, the Company
shall, on or before the end of the calendar year in which such stock is
transferred to Employee, make a loan (the "Stock Loan") to Employee upon the
following terms and conditions:
(i) The Stock Loan shall be in an amount
equal to the actual federal income tax imposed upon the issuance of the common
stock based upon the highest marginal tax bracket actually imposed upon
Employee;
(ii) The Stock Loan shall be evidenced by a
non-recourse promissory note (the "Note"), secured by the stock issued to
Employee as a portion of the Performance Bonus. Interest on the Stock Loan shall
accrue at the prime rate, as published in The Wall Street Journal from time to
time, and shall be payable monthly in arrears. The full amount of the principal
of the Stock Loan, together with any accrued and unpaid interest, shall be
payable one year from the date of the Note;
(iii) The Note shall allow Employee, at any
time, to pay the note in full by tendering to the holder of the Note the stock
secured by the Note.
c. Pursuant to the authorization and action by the
Compensation/Stock Option Committee (the "Compensation Committee") on November
17, 1997, the Employee has been granted options to purchase up to Four Hundred
Fifty Thousand (450,000) shares of the Company's common stock (the "Stock
Options"), subject to the terms and conditions set forth in the Stock Option
Plan and Agreement dated November 17, 1997, attached hereto as Exhibit "A" (the
"Stock Option Plan and Agreement"). Notwithstanding anything to the contrary
contained herein, the Employee may not exercise his Stock Options at any time
prior to the date (the "Shareholder Approval Date") on which the Stock Option
Plan and Agreement is approved by a majority vote of the shareholders of the
Company, in satisfaction of Section 162(m) of the Internal Revenue Code. Subject
to the foregoing, the Employee's Stock Options shall vest and become exercisable
according to the following schedule (provided the Employee's employment
hereunder has not been terminated prior to each "Exercisability Date") and
subject to such other terms as may be contained in the Stock Option Plan and
Agreement:
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Number Of Shares
Exercisability Date Available For Purchase
------------------- ----------------------
Shareholder Approval Date 150,000
June 30, 1998 150,000
June 30, 1999 150,000
In the event the Shareholders of the Company do not approve the Stock
Option Plan and Agreement, in accordance with Section 162(m) of the Internal
Revenue Code, prior to September 30, 1998, any Stock Option granted to the
Employee pursuant to this Section 4.c. shall be deemed null and void AB INITIO,
and Employee shall have the right, on or before December 31, 1998, to terminate
Employee's employment. In the event Employee terminates this Agreement pursuant
to the preceding sentence, the Company shall pay to Employee (i) any Performance
Bonus or Base Compensation earned but unpaid, and (ii) a lump sum severance
compensation in the amount of $300,000, within thirty (30) days following the
date of termination. Employee shall not be entitled to any other compensation or
benefits.
The exercise price of the Stock Options shall be equal to the fair
market value per share of the common stock of the Company at the close of
business on the Shareholder Approval Date. The Stock Options shall expire on the
seventh (7th) anniversary of the applicable Exercisability Date as set forth
above, unless the Stock Options shall be forfeited on an earlier date, as set
forth herein and under the Stock Option Plan and Agreement. All other terms and
conditions of the Stock Options shall be as set forth in the Stock Option Plan
and Agreement.
Notwithstanding the above, any and all unexercisable and/or unexercised
Stock Options shall be forfeited, terminated and deemed null and void on the
dates set forth in Sections 9.a. through 9.d. hereof, as applicable in the event
the Employee's employment hereunder is terminated pursuant to the applicable
section hereof.
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d. In respect of all payments under this Agreement, the
Company shall withhold and pay over to the appropriate governmental agency all
payroll taxes (including income, social security, and unemployment compensation
taxes) required by the federal, state and local governments with jurisdiction
over the Company.
5. RELOCATION. The Company acknowledges that Employee currently owns a
residence located at 0000 Xxxxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxx, 00000-0000 (the
"Residence"). Employee has advised the Company that Employee does not desire to
list the Residence for sale with a broker prior to April 1, 1998, and Employee
agrees to be responsible for all costs and expenses (including, without
limitation, mortgage payments, insurance payments and real estate taxes),
incurred with respect to the Residence through and including March 31, 1998 and
to keep the Residence in a condition substantially similar to its current
condition at the time of execution of this Agreement. From the date of this
Agreement until March 31, 1998, the Company shall reimburse Employee for the
costs to rent an apartment (the "Leased Premises") in Miami, Florida (including
utility expenses but excluding telephone expenses) (the "Rental Expenses");
provided the monthly Rental Expense does not exceed $2,000.00 and such Rental
Expenses are reasonable. From and after April 1, 1998, (i) Employee shall list
the Residence with a licensed real estate broker acceptable to the Company,
pursuant to a listing agreement reasonably acceptable to the Company for an
amount not to exceed $750,000.00, and (ii) the Company will be responsible for
paying all out-of-pocket carrying costs of the Residence (including, without
limitation, mortgage payments, real estate taxes, utilities, insurance payments,
upkeep, maintenance, repair, and similar costs of ownership, operation and
maintenance)(the "Home Expenses"), not to exceed $4,500 per month, until the
earlier to occur of the sale of the Residence or March 31, 1999. Employee agrees
to accept a net purchase price (after all closing costs, prorations and expenses
related to closing) for the Residence equal
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to or exceeding $700,000.00 without regard to any federal taxes which may be
imposed on the sale of the Residence (or less than $700,000.00 in the event the
Company agrees to pay to Employee the difference between $700,000.00 and the
actual net purchase price). In the event the Residence has not been sold for a
net purchase price of at least $700,000.00 prior to March 31, 1999, the Company
agrees to purchase the Residence from Employee for a net purchase price of
$700,000.00; provided however that, in the event the Residence is under a
contract for sale which is scheduled to close after March 31, 1999, the
Company's duty to purchase the Residence on or before March 31, 1999, shall be
postponed until the earlier of the closing of such contract or until the time
for closing under such contract has passed without closing, but the Company
shall pay the Home Expenses during such extended period until the closing or
subsequent purchase of the Residence by the Company. In the event of a sale to
the Company, (i) Employee shall convey to the Company or its designee by
Warranty Deed good, marketable and insurable fee simple title to the Residence
with title in a condition substantially similar to that shown on the title
insurance policy attached hereto as Exhibit "B"(excluding any mortgages or liens
referenced therein), and (ii) all closing costs shall be paid by the Company.
Employee shall be responsible for correcting any title defects with respect to
the Residence at Employee's sole cost and expense. The Company's obligation to
pay the Home Expenses and purchase the Residence pursuant to this Section 5
shall not be terminated by the earlier termination of this Agreement by the
Company without cause pursuant to Section 9.b. below. In addition to the
foregoing, the Company agrees to reimburse Employee for the costs of moving the
Employee's personalty (the Moving Expenses"); provided such expenses are
reasonable and approved by the Company in advance of being incurred.
In the event that Employee purchases a residence in Dade or Broward
County, Florida prior to the earlier to occur of (i) the sale of the Residence,
or (ii) March 31, 1999, the Company agrees to make a loan (the "Relocation
Loan") to the Employee in an amount equal to $700,000.00 less the outstanding
principal balance, together with any accrued and unpaid interest thereon, of any
existing mortgages or liens on the Residence, which Relocation Loan shall remain
outstanding until the Residence is sold to a third party, the Company or its
designee. The Relocation Loan shall be evidenced by a non-recourse promissory
note secured by a second mortgage on the Residence or the new residence, at the
Company's option, provided such mortgage is not prohibited under the applicable
first mortgage. Interest on the Relocation Loan shall accrue at the prime rate,
as published in The Wall Street Journal from time to time, and shall be payable
monthly in arrears. The full amount of the principal of the Relocation Loan,
together with
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any accrued and unpaid interest, shall be due and payable upon the sale of the
Residence.
To the extent that any portion of the Rental Expenses, the Home
Expenses, the Moving Expenses, or the Relocation Loan, results in taxable income
to Employee, the Company shall pay to employee, as an additional cash
performance bonus, the "Gross Up Amount".
6. EXPENSES. The Company will reimburse the Employee for all
reasonable and necessary travel and entertainment and professional expenses
incurred by the Employee in the performance of business-related duties for the
Company and its subsidiaries.
7. FRINGE BENEFITS. During the term of the Employee's employment
hereunder, the Employee shall be entitled to such comparable fringe benefits and
perquisites as may be provided to any or all of the Company's senior executives,
including the President, pursuant to policies established from time to time by
the Board or Compensation Committee, as applicable. These fringe benefits and
perquisites shall include: (a) life insurance and health insurance; (b) four
weeks of paid vacation per year (but not cumulative from year to year); (c)
eligibility to participate in the Company's 401(k) Plan; (d) a Company-leased
car or car allowance equivalent to that provided to the president and chief
executive officer; (e) reimbursement of all reasonable expenses for or related
to car insurance, repairs and maintenance; and (f) reimbursement of up to $1,000
annually for tax planning and tax return preparation services. To the extent
that Employee is not eligible to participate in the Company's 401(k) plan during
any period of employment, the Company shall increase Employee's Base
Compensation by an amount equal to the amount which the Company would have
contributed as matching funds, assuming that the Employee would have made the
maximum contribution that would be allowed by law if the Employee were eligible
to participate in the Company's 401(k) plan during such periods; such increase
to occur at the time such amounts would have otherwise vested in Employee.
8. COVENANTS NOT TO COMPETE. During the Term of the Employee's
employment with the Company, the Employee will not: (a) other than as an
employee of the Company or any of its subsidiaries or affiliates, engage in an
active way in real estate development or sales within the geographical
boundaries of Florida; or (b) engage as a passive investor in real estate
development or sales "in competition" with the Company or any of its
subsidiaries or affiliates. Whether a particular passive investment is in
competition with the Company or any of its subsidiaries or affiliates shall be
determined by the Company's Conflicts Committee upon full disclosure of the
prospective investment by the Employee. The Employee acknowledges and agrees
that (a) the territory set
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forth above in which the foregoing restrictions apply are the areas in which the
Company derives or will derive a significant portion of its revenues, (b) the
foregoing restrictions as to time and area are reasonable for the protection of
the goodwill and business of the Company against irreparable injury, (c) the
foregoing restrictions do not place an undue hardship on the Employee, and (d)
the restrictions do not affect adversely the public's health, safety or welfare.
The Company acknowledges that Employee is or expects to be a passive investor in
a company to be formed which will buy, rehabilitate and sell single family homes
in the central Florida area, with relatives and friends, and the Company agrees
that this activity is not in competition with the Company; provided that
Employee agrees not to be an employee of the company.
9. TERMINATION OF EMPLOYMENT.
a. The Company may terminate the Employee's employment
hereunder at any time for "Cause," as defined below, upon giving written notice
of such involuntary termination to the Employee. In such event, Employee shall
not be entitled to any further compensation, bonus and/or benefits, and any and
all unexercisable and/or unexercised Stock Options as of the date of the
Employee's termination under this Section 9.a. shall be forfeited, terminated
and deemed null and void five (5) business days from the date of termination.
"Cause" justifying termination by the Company immediately upon written notice
shall mean any one of the following acts of or omissions by the Employee:
(1) An action or omission of the Employee which
constitutes a willful and material breach of this Agreement which is not cured
within fifteen (15) days after receipt by the Employee of written notice of
same,
(2) Fraud, embezzlement, misappropriation of
funds, breach of trust or any other dishonest and injurious conduct against the
Company, committed by the Employee,
(3) Conviction of the Employee with respect to a
felony or any other crime that involves moral turpitude, unless the conviction
is attributable to an act committed before the date of this Agreement and the
Company had actual knowledge of such act prior to its execution of this
Agreement,
(4) From and after the date of this Agreement,
any act committed by the Employee involving the excess consumption of alcohol or
drugs, or any other acts of moral turpitude committed in such a manner as to
publicly and adversely reflect upon the reputation or stature of the Company,
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(5) Gross or continuing negligence in connection
with the performance of the Employee's duties hereunder, or
(6) The material and willful or knowing failure
or refusal by the Employee, or the inability of the Employee (other than as a
result of a disability or death), to perform his duties hereunder, or in
accordance with the lawful written instructions of the Board of Directors.
b. If the Company wishes to: (i) terminate the Employee's
employment hereunder other than for Cause, as defined above in Section 9.a.;
(ii) to substantially diminish the duties or responsibilities of Employee; or
(iii) to materially change the title or position of Employee in the hierarchy of
the Company, (all of which shall be deemed to be a "Termination Without Cause",
and in the instance of the Company's actions described in (ii) or (iii)
immediately above, the Employee may either consent to and waive such action or
terminate his employment with the Company in writing with sixty (60) days
notice, which termination shall be deemed to be a Termination Without Cause by
the Company; provided that a failure to timely terminate as aforesaid shall
constitute a waiver by Employee), the Company shall be entitled to do so upon a
60-day written notice to the Employee of the Company's intention to Terminate
Without Cause, provided, however, that: (i) any and all unexercised Stock
Options shall be forfeited, terminated and deemed null and void ninety (90) days
from the date on which the Employee's employment with the Company terminates,
and (ii) Employee shall be entitled to receive the following compensation and
benefits:
(1) any Performance Bonus or Base Compensation
earned but unpaid;
(2) lump sum severance compensation in the
amount of $300,000, payable within fifteen days of notice to the Employee,
regardless of the Employee's future employment; and
(3) during the twelve month period directly
following the effective date of such Termination Without Cause, (i) all fringe
benefits to which the Employee would otherwise be entitled under clauses (a),
(d), (e) and (f) of the second sentence of Section 7 above or, at the Company's
option, the payment of an amount necessary, computed on an after tax basis, for
the Employee to purchase benefits substantially comparable to those to which he
would otherwise be entitled to under clauses (a), (d), (e) and (f) of the second
sentence of Section 7 above and (ii) use of an "out placement" service provider,
as designated by the Company, to the extent the Company's cost therefor does not
exceed $10,000.00; and
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(4) the Company shall assume, pay and be
responsible for all lease obligations in any manner related to the Leased
Premises through the earlier of: (i) the expiration of the term of this
Agreement, or (ii) the expiration of the term of the lease for the Leased
Premises. In such event, the Company shall be entitled to take possession of the
Leased Premises for the period in which the Company is satisfying the lease
obligations.
c. Employee may terminate his employment with the Company at
any time upon sixty (60) days prior written notice to the Company; however in
such event (except for Employee's termination as a result of the Company's
actions described in Section 9.b. above) Employee shall not be entitled to any
further compensation, bonus and/or severance benefits; and any and all
unexercisable and/or unexercised Stock Options as of the Employee's termination
under this Section 9.c. shall be forfeited, terminated and deemed null and void
thirty (30) days from the date of Employee's termination of employment with the
Company.
d. Notwithstanding anything herein to the contrary, this
Agreement shall terminate immediately upon the Employee's death or total and
permanent disability. For purposes of this Agreement, the Employee shall be
considered totally and permanently disabled if, as a result of illness or
injury, the Employee becomes unable to perform his regular duties on the
Company's behalf and such inability continues for 180 or more consecutive days.
In such event, Company shall (i) pay to the Employee or the estate of the
deceased Employee any accrued but unpaid Base Compensation through Employee's
date of disability or death, and (ii) pay to the Employee or the estate of the
deceased Employee his accrued and earned but unpaid Performance Bonus, if any.
Any and all unexercisable and/or unexercised Stock Options as of the date of the
Employee's death or disability shall be forfeited, terminated and deemed null
and void ninety (90) days from the date of the Employee's death and/or
disability.
10. CONFIDENTIALITY/NO SOLICITATION.
a. CONFIDENTIAL INFORMATION. The Employee shall not at any
time during or after his employment with the Company disclose or use, directly
or indirectly, any confidential information or trade secrets of the Company,
except as required by the performance of his duties hereunder and solely for the
Company's benefit and except as may be required by any law or court order. For
the purposes of this Agreement, "confidential information" shall mean all
information disclosed to the Employee, or known by him as a consequence of or
through his employment with the Company, where such information is not generally
known in the trade or industry, and where such information refers or relates in
any manner
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whatsoever to the business activities, processes, services or products of the
Company. Such information includes business and development plans (whether
contemplated, initiates or completed), development sites, business contacts,
methods of operation, results of analysis, customer lists, business forecasts,
financial data, costs, revenues, and similar information. Upon termination of
this Agreement, the Employee shall immediately return to the Company all of its
property, and all copies thereof, including all confidential information which
has been reduced to tangible form, in his possession, custody or control.
b. EMPLOYEE SOLICITATION. The Employee shall not, either
during the term of this Agreement, or the first 180 days after the termination
of this Agreement, solicit, encourage or induce any employee of the Company to
leave his or her employment with the Company.
c. OTHER AGREEMENTS. The Employee represents and warrants
that his performance hereunder shall not conflict with any other agreements to
which he was or is a party. The Employee agrees not to enter into any agreement,
either written or oral, which may conflict with this Agreement.
d. RELIEF. The Employee agrees that the Company will be
irreparably damaged by a breach of Section 8 or this Section 10 and that damages
at law will be an insufficient remedy to the Company. The Employee also agrees
that the Company shall be entitled, upon application to a court of competent
jurisdiction, to obtain injunctive relief to enforce the provisions of Section 8
or this Section 10, which injunctive relief shall be in addition to any other
rights or remedies available to the Company.
This Section 10 shall survive the expiration or earlier termination of
this Agreement.
11. GROSS UP PROVISIONS. It is the intent of the Company and Employee
that: (i) issuance of the Stock Loan to Employee under Section 4.b.; (ii)
reimbursement or payment by the Company of Rental Expenses, the Home Expenses,
or the Moving Expenses; and (iii) the Relocation Loan, be revenue neutral after
taxes to Employee. To the extent that any of the above compensation or payments
made under this Agreement are taxable to Employee, including payments made under
this paragraph, the Company shall pay to Employee the amounts (the "Gross Up
Amounts") necessary to pay all income taxes on such compensation or payments
reimbursed in order to "gross up" the total payments to Employee to cover taxes
on such payments and on the gross up payments required by this paragraph so that
the total payments and reimbursements to Employee
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under Sections 4.b., 5 and 11 of this Agreement shall be revenue neutral after
taxes to Employee.
12. INDEMNIFICATION. The Company shall indemnify Employee in all suits
or proceedings relating to or arising out of conduct or actions in his official
capacity as an officer or employee of the Company to the fullest extent
permitted by Section 145 of the General Corporation Law of the State of
Delaware, including the right to have expenses (including attorney's fees)
incurred by the Employee paid by the Company in advance, as it may be amended
from time to time, and the Company's certificate of incorporation and by-laws.
This Agreement shall not in any manner diminish or change the Employee's
indemnification rights under law, including Delaware law, or under the Company's
certificate of incorporation and by-laws.
13. MODIFICATION. No change or modification of this Agreement shall be
valid unless made in writing and signed by both the Parties.
14. APPLICABLE LAW. Except for Section 12 above, which shall be
governed by and construed in accordance with the laws of the State of Delaware,
this Agreement shall be governed by and construed in accordance with the laws of
the State of Florida, without reference to provisions that refer a matter to the
laws of any other jurisdiction. The Parties hereby agree that venue shall be
exclusively within Dade County, Florida.
15. NO JURY TRIAL. THE COMPANY AND EMPLOYEE HEREBY VOLUNTARILY,
KNOWINGLY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING UNDER OR IN CONNECTION WITH THIS AGREEMENT.
16. ASSIGNMENT PROHIBITED. This Agreement is personal to the Parties
and neither Party may assign or alienate any of its rights or obligations under
this Agreement without the written consent of the other Party.
17. SEVERABILITY. If any part of this Agreement is contrary to,
prohibited by, or deemed invalid under applicable law or regulations, such
provision shall be inapplicable and deemed omitted to the extent so contrary,
prohibited or invalid, but that remainder of this Agreement shall not be invalid
and shall be given full force and effect so far as possible.
18. WAIVERS. The failure or delay of either Party at any time to
require performance by the other of any provision of this Agreement, even if
known, shall not affect the right of such Party to require performance of that
provision or to exercise any right,
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power or remedy hereunder, and any waiver by either Party of any breach of any
provision of this Agreement shall not be construed as a waiver of any continuing
or succeeding breach of such provision, a waiver of the provision itself, or a
waiver of any right, power or remedy under this Agreement. No notice to or
demand on either Party in any case shall, of itself, entitle such Party to any
other or further notice or demand in similar or other circumstances.
19. ENFORCEMENT COSTS. If any legal action or other proceeding is
brought for the enforcement of this Agreement, or because of an alleged dispute,
breach, default or misrepresentation in connection with any provisions of this
Agreement, the successful or prevailing Party shall be entitled to recover
reasonable attorneys' and paralegals' fees, court costs and all expenses even if
not taxable as court costs (including all such fees, costs and expenses incident
to appeals), incurred in that action or proceeding, in addition to any other
relief to which such Party may be entitled. The terms of this Section 19 shall
survive any termination of this Agreement.
20. REMEDIES CUMULATIVE. No remedy conferred upon any Party pursuant to
this Agreement is intended to be exclusive of any other remedy, and each and
every such remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law, in equity, by
statute or otherwise, including the right to recoup damages arising out of a
breach hereof. No single or partial exercise by any Party of any right, power or
remedy hereunder shall preclude any other or further exercise thereof.
21. NOTICES. All notices and other communications required or permitted
under this Agreement shall be in writing, and shall be deemed properly given if
delivered personally, mailed by registered or certified mail in the United
States mail, postage prepaid, return receipt requested, sent by facsimile, or
sent by Express Mail, Federal Express or other nationally recognized express
delivery service, as follows:
If to the Company or the Board:
Atlantic Gulf Communities Corporation
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Attention: President
Fax Number: 000-000-0000
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With a copy to:
Atlantic Gulf Communities Corporation
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: General Counsel
Fax Number: 000-000-0000
If to the Employee:
Xxxx Xxxxxxxxx
0000 Xxxxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Fax Number 000-000-0000
With a copy to:
Xxxxx & Xxxxxxxxx LLP
Attn: Xxxxxxx X. Xxxxxx
000 Xxxxx Xxxxxx Xxxxxx
2300 SunTrust Center
Post Office Box 112
Fax Number: 000-000-0000
Xxxxxxx, Xxxxxxx, 00000
Notice given by hand, certified or registered mail, or by Express Mail,
Federal Express or other such express delivery service, shall be effective upon
actual receipt. Notice given by facsimile transmission shall be effective upon
actual receipt if received during the recipient's normal business hours, or at
the beginning of the recipient's next business day after receipt if not received
during the recipient's normal business hours. All notices by facsimile
transmission shall be confirmed promptly after transmission in writing by
certified mail or personal delivery.
Any party may change any address to which notice is to be given to it
by giving notice as provided above of such change of address.
22. ENTIRE AGREEMENT. This Agreement incorporates the entire agreement
between the Parties with respect to the subject matter here, and supersedes all
other prior or contemporaneous agreements, negotiations or discussions between
the Parties with respect thereto.
23. MISCELLANEOUS. Captions and section headings used herein are for
convenience and are not a part of this Agreement and shall not be used in
construing it. Where necessary or appropriate to the meaning hereof, the
singular and plural shall be deemed to
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include each other, and the masculine, feminine and neuter shall be deemed to
include each other.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first set forth above.
WITNESSES: COMPANY:
ATLANTIC GULF COMMUNITIES
CORPORATION
By:
------------------------- ---------------------------
Print: J. Xxxxx Xxxxxxxxxx,
------------------ Chairman of the Board, President
and Chief Executive Officer
-------------------------
Print:
------------------
EMPLOYEE:
------------------------- ------------------------------
Print: ------------------ XXXX XXXXXXXXX
-------------------------
Print: ------------------
ATLANTIC GULF COMMUNITIES CORPORATION
STOCK OPTION PLAN AND AGREEMENT
FOR
XXXX XXXXXXXXX
AGREEMENT
1. GRANT OF OPTION. Atlantic Gulf Communities Corporation, a Delaware
corporation (the "Company") hereby grants, as of November 17, 1997 to Xxxx
Xxxxxxxxx (the "Optionee") an option (the "Option") to purchase up to Four
Hundred and Fifty Thousand (450,000) shares of the Company's Common Stock, $.10
par value per share (the "Shares"), at an exercise price per share equal to the
Option Price. The Option shall be subject to the terms and conditions set forth
herein. The Option is a nonqualified stock option, and not an Incentive Stock
Option
2. STOCK OPTION PLAN. This Agreement shall also serve as the plan under which
the Option is granted, pursuant to the regulations promulgated under Section 162
of the Internal Revenue Code. The maximum number of shares that may be subject
to acquisition under the Option may not exceed Four Hundred and Fifty Thousand
(450,000) shares.
3. DEFINITIONS. As used herein, the following terms shall have the meaning
indicated:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Cause" shall have the meaning set forth for such term in Section 9.a.
of the Employment Agreement.
(c) "Committee" shall mean a committee appointed by the Board (the
"Committee") which shall be composed of two or more Directors all of whom shall
be Outside Directors. The membership of the Committee shall be constituted so as
to comply at all times with the applicable requirements of Rule 16b-3
promulgated under the Securities Exchange Act and Section 162(m) of the Internal
Revenue Code. The Committee shall serve at the pleasure of the Board and shall
have the powers designated herein and such other powers as the Board may from
time to time confer upon it.
(d) "Common Stock" shall mean the Company's Common Stock, par value $.10
per share.
(e) "Director" shall mean a member of the Board.
(f) "Employment Agreement" shall mean that certain Employment Agreement
entered into by and between the Company and the Optionee, of even date herewith.
(g) "Fair Market Value" of a Share on any date of reference shall mean the
"Closing
Price" (as defined below) of the Common Stock on such date (or if such date is
not a business day, on the immediately preceding business day), unless the
Committee in its sole discretion shall determine otherwise in a fair and uniform
manner. For the purpose of determining Fair Market Value, the "Closing Price" of
the Common Stock on any day shall be the last reported sale price of the Common
Stock on the National Association of Securities Dealers' National Market System,
on an national securities exchange, or, if no such sales price is reported, the
mean between the closing high bid and low asked quotations for such day of
Common Stock on such system, as reported in any newspaper of general
circulation. If no quotation is made for the applicable day, the Fair Market
Value shall be determined in the manner set forth in the preceding sentence
using quotations for the next preceding day for which there were quotations,
provided that such quotations shall have been made within the ten (10) "trading"
days preceding the applicable day. Notwithstanding the foregoing, if no such
information is available, or if otherwise determined necessary by the Committee,
the Fair Market Value shall be determined in good faith by the Committee or the
Board in a fair and uniform manner.
(h) "Incentive Stock Option" shall mean an incentive stock option as
defined in Section 422 of the Internal Revenue Code.
(i) "Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
(j) "Non-Qualified Stock Option" shall mean an Option which is not an
Incentive Stock Option.
(k) "Option" (when capitalized) shall mean any option granted under this
Agreement.
(l) "Option Price" shall mean the Fair Market Value of a Share on the
Shareholder Approval Date.
(m) "Outside Director" shall mean a member of the Board who qualifies as an
"outside director" under Section 162(m) of the Internal Revenue Code and the
regulations thereunder and as a "Non-Employee Director" under Rule 16b-3
promulgated under the Securities Exchange Act.
(n) "Securities Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time.
(o) "Share" shall mean a share of Common Stock..
(p) "Shareholder Approval Date" shall mean the date on which this Stock
Option Plan and Agreement is approved by a majority vote of the shareholders of
the Company, in satisfaction of Section 162(m) of the Internal Revenue Code.
4. EXERCISE SCHEDULE.
(a) Except as otherwise provided in Sections 7 or 10 of this Agreement, the
Option shall
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be exercisable in whole or in part, and cumulatively, according to the following
schedule:
EXERCISABILITY DATE NUMBER OF SHARES THAT BECOME AVAILABLE FOR PURCHASE
Shareholder Approval Date 150,000
June 30, 1998 150,000
June 30, 1999 150,000
(b)The Option shall terminate on, and in no event shall the Option be
exercisable after, the seventh (7th) anniversary of the applicable
Exercisability Date as set forth above.
5. METHOD OF EXERCISE. This Option shall be exercisable in whole or in part in
accordance with the exercise schedule set forth in Section 4 hereof by written
notice which shall state the election to exercise the Option, the number of
Shares in respect of which the Option is being exercised, and such other
representations and agreements as to the holder's investment intent with respect
to such Shares as may be required by the Company. Such written notice shall be
signed by the Optionee and shall be delivered in person or by certified mail to
the Secretary of the Company. The written notice shall be accompanied by payment
of the exercise price. This Option shall be deemed to be exercised after both
(a) receipt by the Company of such written notice accompanied by the exercise
price and (b) arrangements that are satisfactory to the Committee in its sole
discretion have been made for Optionee's payment to the Company of the amount
that is necessary to be withheld in accordance with applicable Federal or state
withholding requirements. No Shares will be issued pursuant to the Option unless
and until such issuance and such exercise shall comply with all relevant
provisions of applicable law, including the requirements of any stock exchange
upon which the Shares then may be traded.
6. METHOD OF PAYMENT. Payment of the exercise price shall be by any of the
following, or a combination thereof, at the election of the Optionee: (a) cash;
(b) check; or (c) such other consideration or in such other manner as may be
determined by the Committee or the Board, which other method, in the discretion
of the Committee or the Board may include, without limitation, payment of the
exercise price in whole or in part (i) with Shares held by the Optionee for at
least six (6) months, (ii) by a promissory note payable to the order of the
Company in a form acceptable to the Committee, or (iii) by the Company retaining
from the Shares to be delivered upon exercise of the Option that number of
Shares having a Fair Market Value on the date of exercise equal to the option
price for the number of Shares with respect to which the Optionee exercises the
Option or by any other form of cashless exercise procedure approved by the
Committee or the Board.
7. TERMINATION OF OPTION. Any and all unvested or unexercised portion of the
Option shall terminate and become null and void at the time of the earliest to
occur of the following:
(a) five (5) business days after the date the Optionee's employment with the
Company is terminated for Cause, pursuant to Section 9.a. of the Employment
Agreement;
(b) ninety (90) days after the date the Optionee's employment with the
Company is
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terminated (i) as a result of a total and permanent disability of the Optionee,
pursuant to Section 9.d. of the Employment Agreement, (ii) as a result of the
death of the Optionee, or (iii) by the Company without Cause, pursuant to
Section 9.b. of the Employment Agreement; or
(c) thirty (30) days after the date the Optionee terminates his employment
with the Company, pursuant to Section 9.c. of the Employment Agreement.
Also, the Committee or the Board, in its sole discretion may by giving
written notice (the "cancellation notice") cancel, effective upon the date of
the consummation of any corporate transaction described in Section 10(a) of this
Agreement or the consummation of any reorganization, merger, consolidation or
other transaction in which the Company does not survive, any Option that remains
unexercised on such date. Such cancellation notice shall be given thirty (30)
days prior to the proposed date of such cancellation and may be given either
before or after approval of such corporate transaction.
8. TRANSFERABILITY.
(a) The Option is not transferable other than by will or by the laws of
descent and distribution, and during the lifetime of the Optionee the Option
shall be exercisable only by the Optionee or the Optionee's legal
representative. The terms of this Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
(b) Unless the prior written consent of the Committee or the Board is
obtained and the transaction does not violate the requirements of Rule 16b-3
promulgated under the Securities Exchange Act, no Shares acquired pursuant to
the exercise of an Option may be sold, assigned, pledged or otherwise
transferred prior to the expiration of the six-month period following the date
on which the Option was granted.
9. NO RIGHTS OF STOCKHOLDERS. Neither the Optionee nor any personal
representative (or beneficiary) shall be, or shall have any of the rights and
privileges of, a stockholder of the Company with respect to any shares of Stock
purchasable or issuable upon the exercise of any portion of the Option prior to
the date of exercise of the Option.
10. CHANGE IN CONTROL. This Option shall become immediately fully exercisable in
the event of a "Change in Control" or in the event that the Committee or the
Board exercises its discretion to provide a cancellation notice with respect to
the Option pursuant to Section 7 hereof. For this purpose, the term "Change in
Control" shall mean:
(a) Approval by the shareholders of the Company of (i) a reorganization,
merger, consolidation or other form of corporate transaction or series of
transactions, in each case, with respect to which persons who were the
shareholders of the Company immediately prior to such reorganization, merger or
consolidation or other transaction do not, immediately thereafter, own more than
50% of the combined voting power entitled to vote generally in the election of
directors
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of the reorganized, merged or consolidated company's then outstanding voting
securities, or (ii) a liquidation or dissolution of the Company or (iii) the
sale of all or substantially all of the assets of the Company (unless such
reorganization, merger, consolidation or other corporate transaction,
liquidation, dissolution or sale is subsequently abandoned); or
(b) Individuals who, as of the date hereof, constitute the Board (as of the
date hereof the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board, provided that (i) any person becoming a director
subsequent to the date hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the election of the
Directors of the Company, as such terms are used in Rule 14a- 11 of Regulation
14A promulgated under the Securities Exchange Act) shall be, for purposes of
this Agreement, considered as though such person were a member of the Incumbent
Board, and (ii) any person becoming a director subsequent to the date hereof who
is nominated by AP-AGC, LLC, a shareholder of the Company, and who replaces a
member of the Incumbent Board nominated by AP-AGC, LLC, shall be for purposes of
this Agreement, considered as though such person were a member of the Incumbent
Board; or
(c) The acquisition (other than from the Company) by any person, entity or
"group", within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act, (excluding, for this purpose, AP-AGC, LLC or the Company or its
subsidiaries, or any employee benefit plan of the Company or its subsidiaries
which acquires beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Securities Exchange Act) of 30% or more of either the then
outstanding Common Stock or the combined voting power of the Company's then
outstanding voting securities entitled to vote generally in the election of
directors.
11. ADJUSTMENT OF SHARES.
(a) If at any time while unexercised Options are outstanding, there shall be
any increase or decrease in the number of issued and outstanding Shares through
the declaration of a stock dividend or through any recapitalization resulting in
a stock split-up, combination or exchange of Shares, then and in such event,
appropriate adjustment shall be made in the number of Shares and the exercise
price per Share thereof subject to any outstanding Option, so that the same
percentage of the Company's issued and outstanding Shares shall remain subject
to purchase at the same aggregate exercise price.
(b) The Committee or the Board may change the terms of Options outstanding
under this Agreement, with respect to the option price or the number of Shares
subject to the Options, or both, when, in the Committee's or Board's sole
discretion, such adjustments become appropriate so as to preserve but not
increase benefits under this Agreement.
(c) Except as otherwise expressly provided herein, the issuance by the
Company of
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shares of its capital stock of any class, or securities convertible into shares
of capital stock of any class, either in connection with a direct sale or upon
the exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
to, the number of or exercise price for Shares then subject to outstanding
Options granted under this Agreement.
(d) Without limiting the generality of the foregoing, the existence of
outstanding Options granted under this Agreement shall not affect in any manner
the right or power of the Company to make, authorize or consummate (i) any or
all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business; (ii) any merger or consolidation of
the Company; (iii) any issue by the Company of debt securities, or preferred or
preference stock that would rank above the Shares subject to outstanding
Options; (iv) the dissolution or liquidation of the Company; (v) any sale,
transfer or assignment of all or any part of the assets or business of the
Company; or (vi) any other corporate act or proceeding, whether of a similar
character or otherwise.
12. ISSUANCE OF SHARES.
(a) The Company shall not be obligated to issue any Shares unless it is
advised by counsel of its selection that it may do so without violation of the
applicable Federal and State laws pertaining to the issuance of securities, and
may require any stock so issued to bear a legend, may give its transfer agent
instructions, and may take such other steps, as in its judgment are reasonably
required to prevent any such violation.
(b) As a condition to any sale or issuance of Shares upon exercise of any
Option, the Committee or the Board may require such agreements or undertakings
as the Committee or the Board may deem necessary or advisable to facilitate
compliance with any applicable law or regulation including, but not limited to,
the following:
(i) a representation and warranty by the Optionee to the
Company, at the time any Option is exercised, that he is
acquiring the Shares to be issued to him for invest ment and
not with a view to, or for sale in connection with, the
distribution of any such Shares; and
(ii) a representation, warranty and/or agreement to be bound
by any legends endorsed upon the certificate(s) for such
Shares that are, in the opinion of the Committee or the Board,
necessary or appropriate to facilitate compliance with the
provisions of any securities laws deemed by the Committee or
the Board to be applicable to the issuance and transfer of
such Shares.
13. SHAREHOLDER APPROVAL REQUIREMENT. Notwithstanding anything to the contrary
herein, the Optionee's rights hereunder shall be subject to and conditioned upon
approval of this Stock Option Plan and Agreement by a majority vote of the
shareholders of the Company, in satisfaction of Section 162(m) of the Internal
Revenue Code.
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14. ADMINISTRATION.
(a) This Agreement shall be administered by the Committee or the Board.
(b) The Committee or the Board, from time to time, may adopt rules and
regulations for carrying out the purposes of this Agreement. The determinations
by the Committee or the Board, and the interpretation and construction of any
provision of this Agreement by the Committee or the Board, shall be final and
conclusive.
15. NO RIGHT TO CONTINUED EMPLOYMENT. Neither the Option nor this Agreement
shall confer upon the Optionee any right to continued employment or service with
the Company.
16. LAW GOVERNING. This Agreement shall be governed in accordance with and
governed by the internal laws of the State of Delaware.
17. INTERPRETATION. The Optionee accepts the Option subject to all the terms and
provisions of this Agreement. The undersigned Optionee hereby accepts as
binding, conclusive and final all decisions or interpretations of the Committee
upon any questions arising under the this Agreement.
18. NOTICES. Any notice under this Agreement shall be in writing and shall be
deemed to have been duly given when delivered personally or when deposited in
the United States mail, registered, postage prepaid, and addressed, in the case
of the Company, to the Company's Secretary at 0000 X. Xxxxxxxx Xxxxx, Xxxxx,
Xxxxxxx 00000, or if the Company should move its principal office, to such
principal office, and, in the case of the Optionee, to the Optionee's last
permanent address as shown on the Company's records, subject to the right of
either party to designate some other address at any time hereafter in a notice
satisfying the requirements of this Section.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.
COMPANY:
ATLANTIC GULF COMMUNITIES
CORPORATION
By:
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Name:
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Title:
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Dated: OPTIONEE:
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By:
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