EXHIBIT 10.1
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of May 14, 1998, by and between Excel Realty Trust,
Inc., a Maryland corporation (the "Company") and Xxxxxx Xxxxxxx ("Executive").
RECITALS
A. Executive is currently President and Chief Operating Officer of New
Plan Realty Trust, a Massachusetts business trust ("New Plan").
B. The Company, a wholly owned subsidiary of the Company ("Sub"), and New
Plan are entering into an Agreement and Plan of Merger ("Merger Agreement"),
pursuant to which Sub shall merge with and into New Plan (the "Merger").
C. The Company desires to employ Employee, effective as of the time the
Merger is consummated (the "Effective Time"), on the terms and conditions set
forth in this Agreement, and Executive desires to be so employed.
AGREEMENT
IN CONSIDERATION of the premises and the mutual covenants set forth below,
the parties hereby agree as follows:
1. Employment. The Company hereby agrees to employ Executive as Chief
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Executive Officer of the Company, and Executive hereby accepts such employment,
on the terms and conditions hereinafter set forth. Notwithstanding the
employment of Executive by the Company, the Company shall be entitled to pay
Executive from the payroll of New Plan.
2. Term. The period of employment of Executive by the Company hereunder
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(the "Employment Period") shall commence at the Effective Time of the Merger
(the "Commencement Date") and shall continue through December 31, 2002;
provided, that, commencing January 1, 2003, and on each January 1 thereafter,
the Employment Period shall automatically be extended for one (1) additional
year unless either party gives written notice not to extend this Agreement prior
to six (6) months before such extension would be effectuated. The Employment
Period may be sooner terminated by either party in accordance
with Section 6 of this Agreement. Employment hereunder and entering into this
Agreement shall not be deemed to constitute termination of employment of
Executive with New Plan and shall not trigger any obligations resulting from
such termination. Therefore, without limiting the generality of the foregoing,
the note(s) of Executive payable to New Plan shall not be accelerated as a
result of this Agreement or any action taken in accordance with the terms
hereof.
3. Position and Duties.
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(a) Position. During the Employment Period, Executive shall serve as
Chief Executive Officer of the Company, and shall report solely and directly to
the Board of Directors of the Company (the "Board"). Executive shall have those
powers and duties normally associated with the position of Chief Executive
Officer, and such other powers and duties as may be properly prescribed by the
Board, provided that such other powers and duties are consistent with
Executive's position as Chief Executive Officer. Executive shall devote such
time, attention and energies to Company affairs as are necessary to fully
perform his duties (other than absences due to illness or vacation) for the
Company. Notwithstanding the above, Executive shall be permitted, to the extent
such activities do not materially and adversely affect the ability of Executive
to fully perform his duties and responsibilities hereunder, to (i) manage
Executive's personal, financial and legal affairs, and (ii) serve on civic or
charitable boards or committees and/or donate a reasonable portion of his time
to various charitable endeavors and organizations. Upon Xxxxxxx Xxxxxx'x
ceasing to serve as Chairman of the Board, the Company intends and expects to
appoint Executive as Chairman of the Board.
(b) No Senior Employee. During the Employment Period, the Company
shall not hire or retain any person to replace him as Chief Executive Officer or
anyone to serve as Chairman of the Board or any other position senior to him
other than Xxxxxxx Xxxxxx.
(c) Investment Committee. At the Effective Time, Executive shall be
appointed by the Board to the Board's Investment Committee (the "Investment
Committee"). During the Employment Period, the Investment Committee shall
consist of four persons, two of which shall be (i) Executive, if he is then a
director, and (ii) an additional director of the Company designated by Executive
if he is then a director. During
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the Employment Period, neither the Company nor the Board shall (w) appoint or
create any other committee to act as the Investment Committee or as an Executive
Committee of the Board without Executive's prior written consent, (x) delegate
any of the duties of the Investment Committee to the Board (subject only to
matters required by law to be voted upon by the Board) or any other committee of
the Board, (y) limit the scope or authority of the Investment Committee except
as provided by the Merger Agreement and its ancillary documents, schedules and
exhibits, or (z) change the size or composition of the Investment Committee. A
similar arrangement shall prevail with respect to the Investment Committee of
the Company's principal subsidiary, New Plan, and the term "Investment
Committee" shall apply to each or both of such Committees.
(d) During the term of this Agreement, Executive shall be nominated
by the Board to serve as a director of the Company.
4. Place of Performance. The principal place of employment of Executive
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shall be at the Company's corporate headquarters in New York, New York.
5. Compensation and Related Matters.
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(a) Salary. During the Employment Period, the Company shall pay
Executive an annual base salary at the rate of not less than the annual salary
paid to the President of the Company, but in no event less than $525,000 per
year ("Base Salary"). Executive's Base Salary shall be paid in approximately
equal installments in accordance with the Company's customary payroll practices.
If Executive's Base Salary is increased by the Company, such increased Base
Salary shall then constitute the Base Salary for all purposes of this Agreement.
(b) Bonus. The Board's compensation committee (the "Compensation
Committee") shall review Executive's performance at least annually during each
year of the Employment Period and cause the company to award Executive a cash
bonus in an amount equal to up to 50% of the Base Salary, as provided in Section
5(a) above, which the Compensation Committee shall reasonably determine as
fairly compensating and rewarding Executive for services rendered to the Company
and/or as an incentive for continued service to the Company; provided, however,
that the cash bonus paid to Executive under this Section 5(b) during the first
year of the Employment Period shall not
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be less than $262,500. Subject to the proviso set forth in the preceding
sentence, the amount of Executive's cash bonus shall be determined in the
reasonable discretion of the Compensation Committee and shall be dependent upon,
among other things, the achievement of certain performance levels by the
Company, including, without limitation, growth in funds from operations, and
Executive's performance and contribution to increasing the funds from
operations.
(c) Stock Options. Incentive stock options (the "Stock Options") are
to be awarded in the future at the times and in the amounts awarded to Xxxx
Xxxxx. Each share subject to the Stock Options shall have an exercise price
equal to the closing price of a share of Common Stock of the Company on the date
of grant. The Stock Options shall be subject to the terms and conditions of the
Company's 1993 Stock Option Plan (the "Company Option Plan"). The Company
hereby represents and warrants to Executive that at the time of grant (a) the
Company Option Plan will have sufficient shares available to effect the grant
and exercise of the Stock Options and the Company Option Plan has been approved
by its shareholders, (b) the Stock Options shall be granted by the Board or by a
compensation committee of the Board satisfying the conditions for "non-employee
directors" under Rule 16b-3, promulgated under the Securities Exchange Act of
1934, as amended ("Rule 16b-3"), (c) the Stock Options will be properly
authorized and approved by the Board and/or its compensation committee, (d) the
Common Stock underlying the Stock Options will be registered on Form S-8 and (e)
the Common Stock underlying the Stock Options will be listed on the New York
Stock Exchange.
(d) Automobile. During the Employment Period, the Company shall
provide Executive with an automobile allowance of at least $12,000 per year or
in lieu thereof purchase a comparable new automobile for the Executive every
three years.
(e) Expenses. The Company shall promptly reimburse Executive for all
reasonable business expenses upon the presentation of reasonably itemized
statements of such expenses in accordance with the Company's policies and
procedures now in force or as such policies and procedures may be modified with
respect to all senior executive officers of the Company.
(f) Vacation. Executive shall be entitled to the number of weeks of
vacation per year provided to the
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Company's President, but in no event less than four (4) weeks annually.
(g) Services Furnished. During the Employment Period, the Company
shall furnish Executive with office space, stenographic and secretarial
assistance and such other facilities and services comparable to those provided
to the Company's President.
(h) Welfare, Pension and Incentive Benefit Plans. During the
Employment Period, Executive (and his spouse and dependents to the extent
provided therein) shall be entitled to participate in and be covered under all
the welfare benefit plans or programs maintained by the Company from time to
time for the benefit of its senior executives including, without limitation, all
medical, hospitalization, dental, disability, accidental death and dismemberment
and travel accident insurance plans and programs. The Company shall at all
times provide to Executive (and his spouse and dependents to the extent provided
under the applicable plans or programs) (subject to modifications affecting all
senior executive officers) the same type and levels of participation and
benefits as are being provided to the Company's President (and his spouse and
dependents to the extent provided under the applicable plans or programs) during
the Employment Period. In addition, during the Employment Period, Executive
shall be eligible to participate in all pension, retirement, savings and other
employee benefit plans and programs maintained from time to time by the Company
for the benefit of its senior executives, or any annual incentive or long-term
performance plans. With respect to each such employee benefit plan, program,
policy or arrangement, service with New Plan or any of its Subsidiaries (as
applicable) shall be included for purposes of determining eligibility to
participate (including waiting periods, and without being subject to any entry
date requirement after the waiting period has been satisfied), vesting (as
applicable) and entitlement to benefits. The medical plan or plans maintained
by the Company after the Effective Time shall waive all limitations as to pre-
existing conditions, exclusions and waiting periods with respect to
participation and coverage requirements. With respect to vacation benefits
provided by the Company, the vacation benefit of Executive shall include all
hours of accrued but unused vacation and sick time hours, respectively, with
New Plan or its affiliates.
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6. Termination. Executive's employment hereunder may be terminated
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during the Employment Period under the following circumstances:
(a) Death. Executive's employment hereunder shall terminate upon his
death.
(b) Disability. If, as a result of Executive's incapacity due to a
physical or mental illness, Executive shall have been substantially unable to
perform his duties hereunder for an entire period of six (6) consecutive months,
and within thirty (30) days after written Notice of Termination (as defined in
Section 7(a) is given after such six (6) months period, Executive shall not have
returned to the substantial performance of his duties on a full-time basis, the
Company shall have the right to terminate Executive's employment hereunder for
"Disability", and such termination in and of itself shall not be, nor shall it
be deemed to be, a breach of this Agreement.
(c) Cause. The Company shall have the right to terminate Executive's
employment for Cause, and such termination in and of itself shall not be, nor
shall it be deemed to be, a breach of this Agreement. For purposes of this
Agreement, the Company shall have "Cause" to terminate Executive's employment
upon Executive's:
(i) conviction of, or plea or guilty or nolo contendere to, a
felony; or
(ii) willful and continued failure to use reasonable best
efforts to substantially perform his duties hereunder (other than such
failure resulting from Executive's incapacity due to physical or mental
illness or subsequent to the issuance of a Notice of Termination by
Executive for Good Reason (as defined in Section 6(d) after demand for
substantial performance is delivered by the Company in writing that
specifically identifies the manner in which the Company believes Executive
has not used reasonable best efforts to substantially perform his duties);
or
(iii) willful misconduct (including, but not limited to, a
willful breach of the provisions of Section 10) that is materially
economically injurious to the Company or to any entity in control of,
controlled by or under common control with the Company ("Affiliate").
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For purposes of this Section 6(c), no act, or failure to act, by Executive
shall be considered "willful" unless committed in bad faith and without a
reasonable belief that the act or omission was in the best interests of the
Company or any Affiliates thereof; provided, however, that the willful
requirement outlined in paragraphs (ii) or (iii) above shall be deemed to have
occurred if the Executive's action or non-action continues for more than ten
(10) days after Executive has received written notice of the inappropriate
action or non-action. Cause shall not exist under paragraph (ii) or (iii) above
unless and until the Company has delivered to Executive a copy of a resolution
duly adopted by a majority of the Board (excluding Executive for purposes of
determining such majority) at a meeting of the Board called and held for such
purpose (after reasonable (but in no event less than thirty (30) days) notice to
Executive and an opportunity for Executive, together with his counsel, to be
heard before the Board), finding that in the good faith opinion of the Board,
Executive was guilty of the conduct set forth in paragraph (ii) or (iii) and
specifying the particulars thereof in detail. This Section 6(c) shall not
prevent Executive from challenging in any court of competent jurisdiction the
Board's determination that Cause exists or that Executive has failed to cure any
act (or failure to act) that purportedly formed the basis for the Board's
determination.
(d) Good Reason. Executive may terminate his employment for "Good
Reason" within thirty (30) days after Executive has actual knowledge of the
occurrence, without the written consent of Executive, of one of the following
events that has not been cured within thirty (30) days after written notice
thereof has been given by Executive to the Company; provided, however, that with
respect to this Section 6(d), the Company shall have the right to challenge in
any court of competent jurisdiction the Executive's determination that he has
the right to terminate his employment for "Good Reason".
(i) the assignment to Executive of duties materially and
adversely inconsistent with Executive's status as Chief Executive Officer
of the Company or a material and adverse alteration in the nature of
Executive's duties and/or responsibilities, reporting obligations, titles
or authority;
(ii) the assignment to Executive of duties materially and
adversely inconsistent with
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Executive's status as a member of the Investment Committee or a material
and adverse alteration in the nature of Executive's duties and/or
responsibilities, titles or authority in such capacity as a member of the
Investment Committee;
(iii) a breach of the Company's obligations under Section 3;
(iv) a reduction by the Company in Executive's Base Salary or a
failure by the Company to pay any such amounts when due;
(v) the hiring of any person during the Employment Period
whose position or authority would be senior to that of Executive other than
Xxxxxxx Xxxxxx;
(vi) the relocation of the Company's corporate headquarters or
Executive's own office location to a location outside of New York, New York
and more than thirty (30) miles from Scarsdale, New York;
(vii) any purported termination of Executive's employment for
Cause which is not effected pursuant to the procedures of Section 6(c) (and
for purposes of this Agreement, no such purported termination shall be
effective);
(viii) the Company's failure to provide the Stock Options or the
Company's material breach of one or more of the stock option agreements
pursuant to which the Stock Options were issued to Executive;
(ix) the Company's failure to substantially provide any
material employee benefits due to be provided to Executive;
(x) the Company's failure to provide in all material respects
the indemnification set forth in Section 11 of this Agreement;
(xi) a Change in Control (as defined below) of the Company; or
(xii) the failure of Executive to be elected Chairman of the
Board within thirty (30) days after Xxxxxxx Xxxxxx ceases to serve as
Chairman of the Board.
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Executive's right to terminate his employment hereunder for Good Reason
shall not be affected by his incapacity due to physical or mental illness.
Executive's continued employment during the thirty (30) day period referred to
above in this paragraph (d) shall not constitute consent to, or a waiver of
rights with respect to, any act or failure to act constituting Good Reason
hereunder.
(e) Without Good Reason. Executive shall have the right to terminate
his employment hereunder without good Reason by providing the Company with a
Notice of Termination, and such termination shall not in and of itself be, nor
shall it be deemed to be, a breach of this Agreement.
(f) Change of Control. For purposes of this Agreement, a "Change in
Control" of the Company means the occurrence of one of the following events:
(1) individuals who, on the Commencement Date, constitute the
Board (the "Incumbent Directors") cease for any reason to constitute at
least a majority of the Board, provided that any person becoming a director
subsequent to the Commencement Date whose election or nomination for
election was approved by a vote of a majority of the Incumbent Directors
then on the Board (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee for
director, without objection to such nomination) shall be an Incumbent
Director; provided, however, that no individual initially elected or
nominated as a director of the Company as a result of an actual or
threatened election contest with respect to directors or as a result of any
other actual or threatened solicitation of proxies by or on behalf of any
person other than the Board shall be an Incumbent Director;
(2) any "person" (as such term is defined in Section 3 (a)(9) of
the Securities Exchange Act of 1934 (the "Exchange Act") and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes, after the
Commencement Date, a "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the Company's then
outstanding securities eligible to vote for the election of the Board (the
"Company Voting Securities"); provided,
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however, that an event described in this paragraph (2) shall not be deemed
to be a Change in Control if any of following becomes such a beneficial
owner: (A) the Company or any majority-owned subsidiary (provided, that
this exclusion applies solely to the ownership levels of the Company or the
majority-owned subsidiary), (B) any tax-qualified, broad-based employee
benefit plan sponsored or maintained by the Company or any majority-owned
subsidiary, (C) any underwriter temporarily holding securities pursuant to
an offering of such securities, (D) any person pursuant to a Non-Qualifying
Transaction (as defined in paragraph (3)), or (E) Executive or any group of
persons including Executive (or any entity controlled by Executive or any
group of persons including Executive);
(3) the consummation of a merger, consolidation, share exchange
or similar form of transaction involving the Company or any of its
subsidiaries, or the sale of all or substantially all of the Company's
assets (a "Business Transaction"), unless immediately following such
Business Transaction (i) more than 50% of the total voting power of the
entity resulting from such Business Transaction or the entity acquiring the
Company's assets in such Business Transaction (the "Surviving Corporation")
is beneficially owned, directly or indirectly, by the Company's
shareholders immediately prior to any such Business Transaction, and (ii)
no person (other than the persons set forth in clauses (A), (B), or (C) of
paragraph (2) above or any tax-qualified, broad-based employee benefit plan
of the Surviving Corporation or its Affiliates beneficially owns, directly
or indirectly, 30% or more of the total voting power of the Surviving
Corporation (a "Non-Qualifying Transaction"); o r
(4) Board approval of a liquidation or dissolution of the
Company, unless the voting common equity interests of an ongoing entity
(other than a liquidating trust) are beneficially owned, directly or
indirectly, by the Company's shareholders in substantially the same
proportions as such shareholders owned the Company's outstanding voting
common equity interests immediately prior to such liquidation and such
ongoing entity assumes all existing obligations of the Company to Executive
under this Agreement and the Stock Option Agreements pursuant to which the
Stock Options were granted.
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(g) Executive retains the right at any time upon six (6) months
notice to the Company to shorten his Employment Period to a date specified in
such notice, but such action shall not require him to resign as a director.
7. Termination Procedure
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(a) Notice of Termination. Any termination of Executive's employment
by the Company or by Executive during the Employment Period (other than
termination pursuant to Section 6(a)) shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 14. For
purposes of this Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision so
indicated.
(b) Date of termination. "Date of Termination" shall mean (i) if
Executive's employment is terminated by his death, the date of his death, (ii)
if Executive's employment is terminated pursuant to Section 6(b), thirty (30)
days after Notice of Termination (provided that Executive shall not have
returned to the substantial performance of his duties on a full-time basis
during such thirty (30) day period), and (iii) if Executive's employment is
terminated for any other reason, the date on which a Notice of Termination is
given or any later date (within thirty (30) days after the giving of such
notice) set forth in such Notice of Termination.
8. Compensation Upon Termination or During Disability. In the event
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Executive is disabled or his employment terminates during the Employment Period,
the Company shall provide Executive with the payments and benefits set forth
below. Executive acknowledges and agrees that the payments set forth in this
Section 8 constitute liquidated damages for termination of his employment during
the Employment Period.
(a) Termination By Company Without Cause or By Executive for Good
Reason. If Executive's employment is terminated by the Company without Cause or
by Executive for Good Reason:
(i) the Company shall pay to Executive (A) his Base Salary and accrued
vacation pay through
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the Date of Termination, as soon as practicable following the Date of
Termination, and (B) a lump sum cash payment of Two Million Five Hundred
Thousand Dollars ($2,500,000), as soon as practicable following the Date of
Termination, provided, however, to the extent that the Company would not be
able to deduct any portion of such payments pursuant to (S)162(m) of the
Internal Revenue Code of 1986, as amended (the "Code"), such portion of the
payment, together with accrued interest as provided below, shall be made at
the earliest time that such portion first would be deductible by the
Company under Code (S)162(m); and provided, further that to the extent that
any portion of such payment is deferred as provided in this Section
8(a)(i), such portion shall accrue interest at the rate of 8% per annum
from the Date of Termination until the payment is made;
(ii) the Company shall maintain in full force and effect, for
the continued benefit of Executive, his spouse and his dependents for a
period of three (3) years following the Date of Termination the medical,
hospitalization, dental, and life insurance program in which Executive, his
spouse and his dependents were participating immediately prior to the Date
of Termination at the level in effect and upon substantially the same terms
and conditions (including without limitation contributions required by
Executive for such benefits) as existed immediately prior to the Date of
Termination; provided, that if Executive, his spouse or his dependents
cannot continue to participate in the Company programs providing such
benefits, the Company shall arrange to provide Executive, his spouse and
his dependents with the economic equivalent of such benefits which they
otherwise would have been entitled to receive under such plans and programs
("Continued Benefits"), provided, that such Continued Benefits shall
terminate on the date or dates Executive receives substantially equivalent
coverage and benefits, without waiting period or pre-existing condition
limitations, under the plans and programs of a subsequent employer (such
coverage and benefits to be determined on a coverage-by-coverage, or
benefit-by-benefit, basis); and
(iii) the Company shall reimburse Executive pursuant to Section
5(e) for reasonable
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expenses incurred, but not paid prior to such termination of employment;
(iv) Executive shall be entitled to any other rights,
compensation and/or benefits as may be due to Executive in accordance with
the terms and provisions of any agreements, plans or programs of the
Company;
(v) all stock options and other pension or employment benefits
granted to Executive during the Employment Period and more than one year
prior to the Date of Termination shall fully vest as of the Date of
Termination and all stock options granted before the Employment Period
shall fully vest;
(vi) the Company shall forgive and cancel all loans made by the
Company or any Affiliate to Executive during the Employment Period, if any,
and shall take all actions and execute all documents necessary to evidence
the forgiveness and cancellation of such loans; and
(vii) the Company shall eliminate any and all restrictions on
Executive's ability either to engage in any activities, directly or
indirectly, in competition with the Company (including, without limitation,
the restrictions set forth in Section 10(c) of this Agreement but not the
restrictions set forth in Sections 10(a) and (b)), or to make any
investment in competition with the Company and shall execute all documents
necessary or reasonably requested by Executive to reflect such elimination
of restrictions.
The foregoing notwithstanding, the total of the severance payments payable
under this Section 8(a) shall be reduced to the extent the payment of such
amounts would cause Executive's total termination benefits (as determined by
Executive's tax advisor) to constitute and "excess" parachute payment under
Section 280G of the Code and by reason of such excess parachute payment
Executive would be subject to an excise tax under Section 4999(a) of the Code,
but only if Executive determines that the after-tax value of the termination
benefits calculated with the foregoing restrictions exceed those calculated
without the foregoing restriction:
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(b) Cause or By Executive Without Good Reason. If Executive's
employment is terminated by the Company for Cause or by Executive (other than
for Good Reason);
(i) the Company shall pay Executive his Base Salary and, to
the extent required by law or the Company's vacation policy, his accrued
vacation pay through the Date of Termination, as soon as practicable
following the Date of Termination; and
(ii) the Company shall reimburse Executive pursuant to Section
5(e) for reasonable expenses incurred, but not paid prior to such
termination of employment, unless such termination resulted from a
misappropriation of Company funds; and
(iii) Executive shall be entitled to any other rights,
compensation and/or benefits as may be due to Executive in accordance with
the terms and provisions of any agreements, plans or programs of the
Company.
(c) Disability. During any period that Executive fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness
("Disability Period"), Executive shall continue to receive his full Base Salary
set forth in Section 5(a) until his employment is terminated pursuant to Section
6(b). In the event Executive's employment is terminated for Disability pursuant
to Section 6(b) ;
(i) the Company shall pay to Executive (A) his Base Salary and
accrued vacation pay through the Date of Termination, as soon as
practicable following the Date of Termination, and (B) continued Base
Salary (as provided for in Section 5(a)) and Continued Benefits for the
longer of (i) six (6) months or (ii) the date on which Executive becomes
entitled to long-term disability benefits under the applicable plan or
program of the Company paying the benefits described in Section 5(h), up to
a maximum of three (3) years of Base Salary continuation; and
(ii) the Company shall reimburse Executive pursuant to Section
5(e) for reasonable expenses incurred, but not paid prior to such
termination of employment; and
(iii) Executive shall be entitled to any other rights,
compensation and/or benefits as may be due to Executive in accordance with
the terms and
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provisions of any agreements, plans or programs of the Company.
(d) Death. If Executive's employment is terminated by his death:
(i) the Company shall pay in a lump sum to Executive's
beneficiary, legal representatives or estate, as the case may be,
Executive's Base Salary through the Date of Termination and one (1) times
Executive's annual rate of Base Salary, and shall provide Executive's
spouse and dependents with Continued Benefits for one (1) year;
(ii) the Company shall reimburse Executive's beneficiary, legal
representatives, or estate, as the case may be, pursuant to Section 5(e)
for reasonable expenses incurred, but not paid prior to such termination of
employment; and
(iii) Executive's beneficiary, legal representatives or estate,
as the case may be, shall be entitled to any other rights, compensation and
benefits as may be due to any such persons or estate in accordance with the
terms and provisions of any agreements, plans or programs of the Company.
(e) Failure to Extend or Election to Shorten Term. A failure to
extend the Agreement pursuant to Section 2 by either party or by Executive
electing to shorten the term of his employment pursuant to paragraph 6(g) shall
not be treated as a termination of Executive's employment for purposes of this
Agreement.
9. Mitigation. Executive shall not be required to mitigate amounts
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payable under this Agreement by seeking other employment or otherwise, and there
shall be no offset against amounts due Executive under this Agreement on account
of subsequent employment except as specifically provided herein. Additionally,
amounts owed to Executive under this Agreement shall not be offset by any claims
the Company may have against Executive, and the Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any other circumstances, including, without
limitation, any counterclaim, recoupment, defense or other right which the
Company may have against Executive or others.
10. Confidential Information, Ownership of Documents; Non-Competition.
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(a) Confidential Information. Executive shall hold in a fiduciary
capacity for the benefit of the Company all trade secrets and confidential
information, knowledge or data relating to the Company and its businesses and
investments, which shall have been obtained by Executive during Executive's
employment by the Company and which is not generally available public knowledge
(other than by acts by Executive in violation of this Agreement). Except as may
be required or appropriate in connection with his carrying out his duties under
this Agreement, Executive shall not, without the prior written consent of the
Company or as may otherwise be required by law or any legal process, or as is
necessary in connection with any adversarial proceeding against the Company (in
which case Executive shall use his reasonable best efforts in cooperating with
the Company in obtaining a protective order against disclosure by a court of
competent jurisdiction), communicate or divulge any such trade secrets,
information, knowledge or data to anyone other than the Company and those
designated by the Company or on behalf of the Company in the furtherance of its
business or to perform duties hereunder.
(b) Removal of Documents; Rights to Products. All records, files,
drawings, documents, models, equipment, and the like relating to the Company's
business, which Executive has control over shall not be removed from the
Company's premises without its written consent, unless such removal is in the
furtherance of the Company's business or is in connection with the Executive's
carrying out his duties under this Agreement and, if so removed, shall be
returned to the Company promptly after termination of Executive's employment
hereunder, or otherwise promptly after removal if such removal occurs following
termination of employment. Executive shall assign to the Company all rights to
trade secrets and other products relating to the Company's business developed by
him alone or in conjunction with others at any time while employed by the
Company.
(c) Protection of Business. During the Employment Period and until
the first anniversary of Executive's Date of Termination (but only in the event
Executive is terminated by the Company for Cause, Executive terminates
employment without Good Reason or Executive is terminated by the Company for
Disability), the Executive will not (i) engage, anywhere within the geographical
areas in which the Company or any of its Affiliates (the "Designated Entities")
are conducting their business operations or providing services as of the
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Date of Termination, in any business which is being engaged in by the Designated
Entities as of the Date of Termination or pursue or attempt to develop any
project known to Executive and which the Designated Entities are pursuing,
developing or attempting to develop as of the Date of Termination, unless such
project has been inactive for over nine (9) months (a "Project"), directly or
indirectly, alone, in association with or as a shareholder, principal, agent,
partner, officer, director, employee or consultant of any other organization,
(ii) divert to any entity which is engaged in any business conducted by the
Designated Entities in the same geographic area as the Designated Entities, any
Project or any customer of any of the Designated Entities, or (iii) solicit any
officer, employee (other than secretarial staff) or consultant of any of the
Designated Entities to leave the employ of any of the Designated Entities.
Notwithstanding the preceding sentence, Executive shall not be prohibited from
owning less than three 3% percent of any publicly traded corporation, whether or
not such corporation is in competition with the Company. If, at any time, the
provisions of this Section 10(c) shall be determined to be invalid or
unenforceable, by reason of being vague or unreasonable as to area, duration or
scope of activity, this Section 10(c) shall be considered divisible and shall
become and be immediately amended to only such area, duration and scope of
activity as shall be determined to be reasonable and enforceable by the court or
other body having jurisdiction over the matter; and Executive agrees that this
Section 10(c) as so amended shall be valid and binding as though any invalid or
unenforceable provision had not been included herein.
(d) Injunctive Relief. In the event of a breach or threatened breach
of this Section 10, Executive agrees that the Company shall be entitled to
injunctive relief in a court of appropriate jurisdiction to remedy any such
breach or threatened breach, Executive acknowledging that damages would be
inadequate and insufficient.
(e) Continuing Operation. Except as specifically provided in this
Section 10, the termination of Executive's employment or of this Agreement shall
have no effect on this continuing operation of this Section 10.
11. Indemnification.
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(a) General. The Company agrees that if Executive is made a party or
threatened to be made a party to any action, suits or proceeding, whether
civil, criminal, administrative or investigative (a "Proceeding"), by reason of
the fact that Executive is or was a trustee, director or officer of the Company
or any subsidiary of the Company or is or was serving at the request of the
Company or any subsidiary as a trustee, director, officer, member, employee or
agent of another corporation or a partnership, joint venture, trust or other
enterprise, including, without limitation, service with respect to employee
benefit plans, whether or not the basis of such Proceeding is alleged action in
an official capacity as a trustee, director, officer, member, employee or agent
while serving as a trustee, director, officer, member, employee or agent,
Executive shall be indemnified and held harmless by the Company to the fullest
extent authorized by Maryland law, as the same exits or may hereafter be
amended, against all Expenses incurred or suffered by Executive in connection
therewith, and such indemnification shall continue as to Executive even if
Executive has ceased to be an officer, director, trustee or agent, or is no
longer employed by the Company and shall inure to the benefit of his heirs,
executors and administrators.
(b) Expenses. As used in his Agreement, the term "Expenses" shall
include, without limitation, damages, losses, judgments, liabilities, fines,
penalties, excise taxes, settlements, and costs, attorneys' fees, accountants'
fees, and disbursements and costs of attachment or similar bonds,
investigations, and any expenses of establishing a right to indemnification
under this Agreement.
(c) Enforcement. If a claim or request under this Agreement is not
paid by the Company or on its behalf, within thirty (30) days after a written
claim or request has been received by the Company, Executive may at any time
thereafter bring suit against the Company to recover the unpaid amount of the
claim or request and if successful in whole or in part, Executive shall be
entitled to be paid also the expenses of prosecuting such suit. All obligations
for indemnification hereunder shall be subject to, and paid in accordance with,
applicable Maryland law.
(d) Partial Indemnification. If Executive is entitled under any
provision of this Agreement of indemnification by the Company for some or a
portion of any Expenses, but not, however, for the total amount
18
thereof, the Company, shall nevertheless indemnify Executive for the portion of
such Expenses to which Executive is entitled.
(e) Advances of Expenses. Expenses incurred by Executive in
connection with any Proceeding shall be paid by the Company in advance upon
request of Executive that the Company pay such Expenses; but, only in the event
that Executive shall have delivered in writing to the Company (i) an undertaking
to reimburse the Company for Expenses with respect to which Executive is not
entitled to indemnification and (ii) an affirmation of his good faith belief
that the standard of conduct necessary for indemnification by the Company has
been met.
(f) Notice of Claim. Executive shall give to the Company notice of
any claim made against him for which indemnification will or could be sought
under this Agreement. In addition, Executive shall give the Company such
information and cooperation as it may reasonably require and as shall be within
Executive's power and at such times and places as are convenient for Executive.
(g) Defense of Claim. With respect to any Proceeding as to which
Executive notifies the Company of the commencement thereof:
(i) The Company will be entitled to participate therein at its
own expense; and
(ii) Except as otherwise provided below, to the extent that it
may wish, the Company will be entitled to assume the defense thereof, with
counsel reasonably satisfactory to Executive which in the Company's sole
discretion may be regular counsel to the Company and may be counsel to
other officers and directors of the Company or any subsidiary. Executive
also shall have the right to employ his own counsel in such action, suit or
proceeding if he reasonably concludes that failure to do so would involve a
conflict of interest between the Company and Executive, and under such
circumstances the fees and expenses of such counsel shall be at the expense
of the Company.
(iii) The Company shall not be liable to indemnify Executive
under this Agreement for any amounts paid in settlement of any action or
claim effected without its written consent. The Company shall not settle
any action or claim in any manner
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which would impose any penalty or limitation on Executive without
Executive's written consent. Neither the Company nor Executive will
unreasonably withhold or delay their consent to any proposed settlement.
(h) Non-exclusivity. The right to indemnification and the payment of
expenses incurred in defending a Proceeding in advance of its final
disposition conferred in this Section 11 shall not be exclusive of any
other right which Executive may have or hereafter may acquire under any
statute, provision of the declaration of trust or certificate of
incorporation or by-laws of the Company or any subsidiary, agreement, vote
of shareholders or disinterested directors or trustees or otherwise.
12. Legal Fees and Expenses. If any contest or dispute shall arise
-----------------------
between the Company and Executive regarding any provision of this Agreement, the
Company shall reimburse Executive for all legal fees and expenses reasonably
incurred in by Executive in connection with such contest or dispute, but only if
Executive is successful in respect of substantially all of Executive's claims
brought and pursued in connection with such contest or dispute. Such
reimbursement shall be made as soon as practicable following the final
resolution of such contest or dispute to the extent the Company receives
reasonable written evidence of such fees and expenses.
13. Successors; Binding Agreement.
-----------------------------
(a) Company's Successors. No rights or obligations of the Company
under this Agreement may be assigned or transferred except that the Company will
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to expressly assume and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. As used in this Agreement,
"Company" shall mean the Company as herein before defined and any successor to
its business and/or assets (by merger, purchase or otherwise) which executes and
delivers the agreement provided for in this Section 13 or which otherwise
becomes bound by all the terms and provisions of this Agreement by operation of
law.
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(b) Executive's Successors. No rights or obligations of Executive
under this Agreement may be assigned or transferred by Executive other than his
rights to payments or benefits hereunder, which may be transferred only by will
or the laws of descent and distribution. Upon Executive's death, this Agreement
and all rights of Executive hereunder shall inure to the benefit of and be
enforceable by Executive's beneficiary or beneficiaries, personal or legal
representatives, or estate, to the event any such person succeeds to Executive's
interests under this Agreement. Executive shall be entitled to select and change
a beneficiary or beneficiaries to receive any benefit or compensation payable
hereunder following Executive's death by giving the Company written notice
thereof. In the event of Executive's death or a judicial determination of his
incompetence, reference in this Agreement to Executive shall be deemed, where
appropriate, to refer to his beneficiary(ies), estate or other legal
representative(s). If Executive should die following his Date of Termination
while any amounts would still be payable to him hereunder if he had continued to
live, all such amounts unless otherwise provided herein shall be paid in
accordance with the terms of this Agreement to such person or persons so
appointed in writing by Executive, or otherwise to his legal representatives or
estate.
14. Notice. For the purposes of this Agreement, notices, demands and all
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other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when delivered either personally or by
United States certified or registered mail, return receipt requested, postage
prepaid, addressed as follows:
If to Executive:
Xxxxxx Xxxxxxx
1120 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
If to the Company:
Excel Realty Trust
1120 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
15. Miscellaneous. No provisions of this Agreement may be amended,
-------------
modified, or waived unless such amendment or modification is agreed to in
writing signed by Executive and by a duly authorized officer of the Company, and
such waiver is set forth in writing and signed by the party to be charged. No
waiver by either party hereto at any time of any breach by the other party
hereto of any condition or provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. The respective rights and obligations of the
parties hereunder of this Agreement shall survive Executive's termination of
employment and the termination of this Agreement to the extent necessary for the
intended preservation of such fights and obligations. The validity,
interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of New York without regard to its conflicts of law
principles.
16. Validity. The invalidity or unenforceability of any provision or
--------
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of the Agreement, which shall remain in full force and
effect.
17. Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
18. Entire Agreement. This Agreement sets forth the entire agreement of
----------------
the parties hereto in respect of the subject matter contained herein and
supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto in respect of such
subject matter. Any prior agreement of the parties hereto in respect of the
subject matter contained herein is hereby terminated and canceled.
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19. Shareholder Approval. The Company represents and warrants to Executive
--------------------
that no shareholder approval is required for the Company to enter into this
Agreement and provide the benefits hereunder and to enter into the agreements
described in Section 5.
20. Withholding. All payment he renders shall be subject to any required
-----------
withholding of Federal, state and local taxes pursuant to any applicable law or
regulation.
21. Noncontravention. The Company represents that the Company is not
----------------
prevented from entering into, or performing this Agreement by the terms of any
law, order, rule or regulation, its by-laws or certificate of incorporation, or
any agreement to which it is a party, other than which would not have a material
adverse effect on the Company's ability to enter into or perform this Agreement.
22. Section Heading. The section headings in this Employment Agreement
---------------
are for convenience of reference only, and they form no part of this Agreement
and shall not affect its interpretation.
23. Resignation and Termination. As of the Effective Date, Executive
---------------------------
shall resign as President and Chief Operating Officer of East.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first above written.
EXCEL REALTY TRUST, INC.
a Maryland corporation
By: /s/ Xxxx X. Xxxxx
----------------------
Name: Xxxx X. Xxxxx
--------------------
Title: President
-------------------
/s/ Xxxxxx Xxxxxxx
-------------------------
Xxxxxx Xxxxxxx
