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EXHIBIT 10.61
EMPLOYMENT AGREEMENT
This Agreement ("Agreement") is made as of this 31st day of January, 1997
by and between XXX XXXXXX (hereinafter "Xxxxxx") and FIRST INDUSTRIAL REALTY
TRUST, INC., a Maryland corporation (hereinafter "Employer"). Capitalized terms
contained herein and otherwise undefined shall have the respective meanings
given to each of them in that certain Contribution Agreement, dated as of
January 31, 1997, by and among FR Acquisitions, Inc. and the other parties
thereto (the "Contribution Agreement").
The parties hereto agree as follows:
ARTICLE I - TERM OF EMPLOYMENT
1.01 Employer hereby employs Xxxxxx and Xxxxxx hereby accepts employment by
Employer commencing on the date hereof and pursuant to the terms hereof.
1.02 The term of this Agreement (the "Term") shall end at 12:01 a.m. New
York time on the fifth anniversary of the date hereof (the "Expiration Date"),
except as otherwise provided herein.
ARTICLE II - DUTIES AND POWERS OF BURMAN
2.01 Except as may be otherwise approved by the Board of Directors of
Employer (the "Board") or as otherwise expressly provided herein, Xxxxxx shall
devote his full-time, diligent and good faith efforts to the operation of the
business of Employer, as more fully detailed below, at all times in accordance
with any and all written rules and policies of Employer, if and to the extent
that such rules and policies are uniformly enforced with respect to all Senior
Regional Directors of Employer (the "SRDs"). Additionally during the Term,
except as may otherwise be approved by the Board, Employer shall be entitled to
the exclusive benefits of Burman's knowledge, experience, business contacts and
opportunities relating to the business of Employer. Notwithstanding anything to
the contrary contained in this Agreement, however, Xxxxxx shall have the right
to participate in strategic and significant business decisions (e.g., sale and
refinance) concerning the Retained Properties, but Xxxxxx, acting in his
individual capacity, shall not have the right to participate in the day-to-day
management and leasing decisions concerning any or all of the Retained
Properties. The "business of Employer" shall consist of the acquisition,
development, ownership, management, leasing and sale of warehouse and industrial
real property.
Xxxxxx shall be responsible to Employer to perform and/or oversee the
following:
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1. The day-to-day management and operation of real property assets
located (collectively, the "Territory"), owned by Employer or by entities in
which Employer holds an ownership interest ("Property Management");
2. The marketing for lease or sale of real property assets located in
the Territory and owned or managed by Employer or entities in which
Employer holds an ownership interest (together with Employer, the "Employer
Entities") and the negotiation, documentation and consummation of lease and
sale transactions involving real property assets located in the Territory and
owned or managed by Employer Entities (the "Real Property Assets")
[collectively, "Marketing"];
3. The acquisition of Real Property Assets, if and to the extent such
acquisitions are approved by the Board (or the Board's Investment Committee, as
the case may be) or the appropriate partners, officers or directors of any other
applicable affiliate of Employer ("Acquisition").
2.02 Xxxxxx will hold the title of SRD of the Territory, and shall have
primary responsibility for the conducting of Employer's business in the
Territory. The Territory's Regional Headquarters will be located initially in
Syosset, New York, but may be relocated elsewhere in Nassau County, New York by
Employer.
2.03 If (a) a proposed Acquisition is presented to Employer by Xxxxxx; (b)
Employer approves such Acquisition in accordance with its policies and
procedures then in effect; and (c) the property to be acquired (the "New
Property") is located outside the then-applicable geographic boundaries of the
Territory, then, upon the closing of such Acquisition, the Territory shall
automatically be expanded to include the city (or township, village or
municipality, as the case may be) in which the New Property is located unless
(i) the New Property is located in the existing territory of another SRD (it
being understood and agreed that, except as is otherwise expressly provided in
this Section 2.03 with respect to the Territory, the senior officers of Employer
shall have the sole discretion to establish the geographic boundaries of each
SRD's respective territory); or (ii) the Board (or the Investment Committee, as
the case may be), in the process of approving the acquisition of the New
Property, specifically determines that the Territory shall not so expand. In the
event that either (i) or (ii) above is applicable, then none of Burman and the
employees engaged by Employer in the Territory shall be responsible for the
day-to-day management and operation of that particular New Property. Except as
otherwise expressly provided above in this Section 2.03, any other expansion or
contraction of the Territory shall be made by amendment to this Agreement and
shall be subject to Burman's prior approval.
2.04 Subject to: (a) with respect to those matters that may require Board
approval, the specific approval of the Board; (b) policies or guidelines
implemented by Employer out of its Chicago headquarters or by the Board, and
uniformly applied with respect to all SRDs; and (c) any budget adopted by
Employer, from time to time during the Term, with respect to all or some portion
of the Territory (a "Budget"), Xxxxxx shall have the right and obligation within
the Territory to: (i) hire and fire employees (pursuant to Employer's personnel
policies, as such
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policies may be modified or amended from time to time); (ii) establish, review,
and revise the compensation of employees engaged to perform services in the
Territory (excepting only himself); (iii) negotiate, document, and enter into
contracts for Property Management and Marketing; (iv) negotiate, document, and
enter into contracts with such suppliers of products and services as Xxxxxx
deems appropriate for the rendering of Property Management and Marketing
services to Employer; (v) purchase or lease equipment for Employer for the
performance and rendering of Property Management, Marketing and Acquisition
services, and tend to all matters relating thereto; (vi) lease building space
for occupancy by Employer for Employer's offices and for such other reasonable
functions as Xxxxxx deems appropriate for the business of Employer in the
Territory; and (vii) negotiate, document, execute and perform under leases on
behalf of any Employer Entities, whether as landlord or management/leasing
agent, as the case may be ("Leases"). Notwithstanding anything to the contrary
contained in this Section 2.04, and, with respect to leasing commissions and
tenant improvements, Section 2.06, if any expenditure proposed to be made by
Burman pursuant to his duties to Employer (1) is not contemplated or provided
for in the relevant Budget and (2) exceeds $25,000, per item or occasion,
Xxxxxx shall refrain from making such expenditure until Xxxxxx receives the
approval for such expenditure from any Vice President or more senior officer
based in the Chicago headquarters of Employer.
2.05 Without the prior approval of the Board or the Investment Committee,
as the case may be (which, as in all cases requiring the approval or consent of
the Board or Investment Committee under this Agreement, may be given or withheld
in the Board's or the Investment Committee's sole discretion), Xxxxxx shall not
do any or all of the following:
1. Increase his compensation or extend the Term;
2. Purchase, or contract to purchase, any real
property on behalf of Employer or any Employer Entities; or
3. Sell or refinance, or contract to sell or
refinance, any Real Property Assets on behalf of Employer or
any Employer Entities.
Xxxxxx agrees that he shall promptly advise the Employer's chief investment
officer or its Senior Vice President-Acquisitions (individually or
collectively, "Head of Acquisitions") of the pendency of any acquisition or
disposition of any real property on behalf of Employer or any Employer
Entities, and shall follow the directions of the Head of Acquisitions with
respect to the further pursuit of any such potential acquisition or
disposition. If, at any time during the Term, however, Xxxxxx seeks approval
or direction from the Head of Acquisitions with respect to a particular
acquisition or disposition, and the Head of Acquisitions is not available, then
Xxxxxx may seek approval or direction from Employer's Chief Operating Officer
(the "COO"). If Xxxxxx receives the approval of the Head of Acquisitions or
the COO, as applicable, to pursue an acquisition or disposition, and Xxxxxx
desires that a formal purchase and sale contract be executed in connection
therewith, then any one of the President, Chief Operating Officer, Chief
Financial Officer or Senior Vice President - Acquisitions of Employer shall be
the signatory to any such contract for an acquisition or disposition. Xxxxxx
acknowledges that, as of the date of this Agreement, no acquisition or
disposition may be consummated on behalf
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of the Employer without the approval of the Investment Committee or, in certain
instances, the Board. As of the date of this Agreement, acquisitions or
dispositions of real property on behalf of Employer require only the approval
of the Investment Committee if the aggregate consideration required to be paid
for such acquisition or disposition does not exceed $15,000,000. Currently,
then, the Board must approve acquisitions or dispositions involving
consideration in excess of $15,000,000. Notwithstanding anything to the
contrary contained in this Section 2.05, if the Board modifies its policies
with respect to the matters provided in this Section 2.05, and such
modifications are applicable to all SRDs, or to Xxxxxx, as an SRD,
specifically, then Xxxxxx shall abide by such modified policies to the extent
such policies differ from what is provided above in this Section 2.05.
2.06 Notwithstanding anything to the contrary contained above, without the
prior approval of the COO, or such other officer designated by the COO for such
purpose, Xxxxxx shall not enter into any Lease (i) with respect to premises
exceeding 100,000 rentable square feet, or (ii) with annual fixed net base rent
exceeding $500,000 for any year of the lease term, assuming the exercise of all
options in the Lease, or (iii) with an initial term exceeding five (5) years, or
with a full term, assuming the exercise of all options in the Lease, exceeding
ten (10) years, or (iv) that requires the expenditure of $100,000 or more, in
the aggregate, by Employer to both satisfy the obligations imposed on the
landlord under that Lease to perform tenant improvements and pay any leasing
commissions owed by Employer in connection with such Lease.
2.07 As an SRD, Xxxxxx shall also have the authority to negotiate the terms
and provisions of, and enter into, any third-party management contracts for the
day-to-day leasing, operation and management of New Properties if and to the
extent that, in the process of approving an Acquisition, the Investment
Committee or the Board (if the Board's approval of the Acquisition is required)
approve the engagement of a third-party manager for the applicable New Property.
In such an event, Xxxxxx must engage the third-party manager in accordance with
any additional terms, with respect to such third-party management arrangement,
required by the Investment Committee and the Board (if the Board's approval of
the Acquisition is required).
ARTICLE III - COMPENSATION
3.01 Xxxxxx shall receive a guaranteed minimum annual salary ("Annual
Salary"), based on the duration of his employment during any year, equal to the
Annual Salary payable to all other SRDs engaged by Employer, from time to time;
and such Annual Salary shall be payable in twenty-four (24) equal installments
on the fifteenth day and last day of each month during the Term (a "Payment
Date"). The Annual Salary shall be $125,000 for each of 1996 and 1997. If any
Payment Date falls on other than a normal business day, the salary payment due
on such Payment Date shall instead be payable on the last normal business day
preceding such Payment Date.
3.02 In addition to the Annual Salary, Xxxxxx shall also be entitled to
participate in all incentive, bonus and stock option programs offered by
Employer from time to time to the SRDs, as such may be approved or implemented
from time to time by the Compensation
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Committee of the Board. Burman's right to participate in, and to receive
compensation under, such programs shall in no event be on lesser terms or in
lesser amounts than those offered to the SRDs; provided, however, that
incentive or bonus arrangements (a) for which Burman and the SRDs are eligible;
(b) that are based upon the achievement or surpassing of performance goals
established by Employer, and (c) that are based upon specified commercial
criteria made known to Burman and the SRDs in advance, may vary among the
different regions of Employer based upon relative regional performance.
3.03 Employer shall be entitled to withhold from those amounts payable to
Xxxxxx from time to time under this Agreement any and all federal, state or
local withholding or other taxes or charges which Employer is, from time to
time, required (by applicable law, statute, ordinance or regulation) to
withhold. Employer shall be entitled to rely upon the opinion of its legal
counsel with regard to any question concerning the amount or requirement of any
such withholding.
ARTICLE IV - BURMAN'S BENEFITS AND BONUSES
4.01 Employer will provide Xxxxxx with medical/hospitalization/major
medical insurance coverage, including dental benefits, in the same amounts,
pursuant to the same terms, and subject to the same deductible, as is provided
pursuant to the insurance coverage made available, from time to time, to the
SRDs.
4.02 Employer will provide Xxxxxx with, and keep in effect during the
Term, a term life insurance policy which Employer will purchase from an insurer
satisfactory to Xxxxxx and providing coverage in an amount equal to the amount
of such term life insurance provided to the SRDs. Xxxxxx shall have the right
to designate such individual or other entity as he wishes as the owner of such
life insurance policy, and shall have the power to designate and change, from
time-to-time, the beneficiary under such insurance policy.
4.03 Employer will provide Xxxxxx with a disability income insurance policy
that will (i) provide Xxxxxx with income per year equal to that amount of annual
income provided to the SRDs under their respective disability insurance
policies, (ii) have a waiting period of not greater than three (3) months from
the date of sickness, injury or other disability prior to any disability
payment, (iii) provide for lifetime benefits, and (iv) contain a waiver of
premium clause. At Burman's option, he may elect to pay the annual premiums for
such disability insurance himself, in which case his Annual Salary will be
increased by the amount equal to such annual premium. The foregoing disability
income insurance policy will define disability in terms of the functions which
Xxxxxx is required to perform pursuant to this Agreement, and should Xxxxxx not
be able to perform such functions, he shall be deemed disabled under such
policy.
4.04 Xxxxxx shall be entitled to vacation leave of three (3) weeks during
each calendar year, beginning January 1, 1997, with full pay (determined on a
pro rata basis, based on the then-applicable Annual Salary). The time for
vacation shall be chosen by Burman and must be taken within fifteen (15) months
after the start of the calendar year with respect to which such vacation leave
is made available. Burman's right to be paid in lieu of any vacation leave not
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timely taken shall be determined by the Compensation Committee of the Board
and shall be consistent with the policy established for the SRDs.
4.05 Xxxxxx shall be entitled to the following paid holidays per year (if
falling on a day other than a Saturday or Sunday): New Year's Day, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.
4.06 Xxxxxx shall be entitled to fifteen (15) days per calendar year,
beginning January 1, 1997, as sick or personal leave days with full pay
(determined on a pro rata basis, based on the then-applicable Annual Salary).
Sick or personal leave may be accumulated up to a total of twenty (20) days.
4.07 If Xxxxxx becomes disabled during the Term for any reason that
prevents him from fully performing his duties under this Agreement and, as a
result, he would be entitled, but for any waiting period, to disability payments
under the disability insurance policy described above, Employer agrees to
continue his salary (determined on a pro rata basis, based on the
then-applicable Annual Salary) during the period of his disability until such
time as benefits due under the disability income insurance policy (provided
pursuant to Section 4.03 above), begin to accrue, but in no event beyond the end
of the Term.
4.08 So long as this Agreement is in full force and effect, Xxxxxx shall
have the right to provide reasonable office space accommodations at the
Territory's Regional Headquarters for use by Xxxxxx Xxxxxxx (the allocation of
such space will be applied against the Budget in effect from time to time).
4.09 As soon as practicable (i) after the commencement of the Term,
Employer shall cause Xxxxxx to be elected as a member of the board of directors
of FI Development Services Corporation, a wholly-owned subsidiary of Employer,
and (ii) after the commencement of the Term and after such entity has been
incorporated, Employer shall cause Xxxxxx to be elected as a member of the board
of directors of First Industrial Development Services Group, Inc.
4.10 Upon the commencement of the Term of this Agreement, Xxxxxx shall be
elected as a "Signing Officer" of Employer, with authority as designated by the
Board (to the same extent as the SRDs in their respective territories) to
execute various acquisition-, leasing-, operational-, disposition-, and
development-related documents for and on behalf of Employer (either directly or
as general partner of First Industrial, L.P., a Delaware limited partnership).
In addition, during such period of time as Xxxxxx is SRD of the Territory and
Xxxxxxx Xxxxx is employed in the Territory by Employer, Xxxxxxx Xxxxx shall have
the authority to execute Leases so long as (i) Xxxxxx has approved the Lease in
question, (ii) Xxxxxx is unavailable and will not be available to execute an
original of that Lease within the prescribed timeframe to execute such Lease and
(iii) the Lease is for premises not exceeding 10,000 rentable square feet in
size, and has an initial term not exceeding five (5) years and a full term
(assuming the exercise of all options in the Lease) not exceeding ten (10)
years.
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ARTICLE V - REIMBURSEMENT OF BURMAN'S EXPENSES
5.01 Xxxxxx is authorized to incur reasonable business expenses for
promoting the business of Employer, including expenditures for entertainment,
gifts, and travel. Employer will reimburse Xxxxxx in accordance with its normal
expense-reimbursement procedure for all business expenses reasonably incurred,
provided that Xxxxxx presents to Employer both of the following:
(a) A monthly expenses report in which Xxxxxx records:
(i) the amount of each expenditure;
(ii) the date, place, and designation of the type of entertainment,
travel, or other expenses or the date and description of any gift
given by Xxxxxx for a business purpose;
(iii) the business purpose for each expenditure; and
(iv) the name, occupation, address, and other relevant information of
each person who is entertained or given a gift sufficient to
establish the business relationship to Employer.
(b) Documentary evidence (such as receipts or paid bills) providing
sufficient information to establish the amount, date, place, and essential
character of each business expenditure of $75.00 or more.
5.02 In addition to the foregoing, it is understood and agreed that, in
order to properly perform his duties, Xxxxxx must have the use of a mobile
telephone. Employer agrees to pay directly, or to reimburse Xxxxxx for, any and
all costs associated with the purchase, installation, activation, and business
use of such mobile telephone (in the ordinary course of Burman's performance of
his duties under this Agreement).
ARTICLE VI - TERMINATION
6.01 Employer may terminate this Agreement for any reason whatsoever,
including, without limitation, under the following circumstances:
(a) The occurrence of a breach of this Agreement by Xxxxxx (including,
but not limited to, excessive absence) that Xxxxxx does not cure within ten
(10) days after Employer delivers to Xxxxxx written notice of the alleged
breach ("Default Notice"). Notwithstanding the foregoing, if such breach
is not capable of being cured within such ten-day period, but Xxxxxx
commences to cure such breach within five (5) days of Employer's delivery
of the Default Notice, then Xxxxxx may have such additional time as may be
reasonably necessary, up to a maximum of 30 days, to complete such cure,
acting diligently and in good faith. A termination pursuant to this
paragraph shall take
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effect upon the expiration of the relevant cure period, if the subject
breach has not been cured.
(b) For "cause," which, for purposes of this Agreement, shall include,
without limitation, (i) the fraudulent or criminal conduct of Xxxxxx
adversely affecting Employer, (ii) alcoholism of, or illegal substance
abuse by, Xxxxxx, (iii) any willful, reckless, or grossly negligent act, or
failure to act, of Xxxxxx, or any breach of the fiduciary duty owed by
Burman to Employer, which breach has a material adverse effect on either or
both of (x) the reputation of either or both of Xxxxxx and Employer and (y)
Employer's products, trademarks or goodwill (including, without limitation,
the reputation thereof), or (iv) any dishonesty, disclosure of Confidential
Information (as hereinafter defined) or aiding a competitor of Employer. A
termination "for cause" shall take effect immediately upon written notice
to Xxxxxx from Employer;
(c) Xxxxxx suffering a long-term disability. A long-term disability
shall be defined as Burman's inability (based on the standard for honoring
a claim established under the disability insurance policy procured for
Burman pursuant to this Agreement), due to illness or injury (including
alcoholism or illegal substance abuse), to perform his duties as
established in Article II above, for a period of three (3) consecutive
months. A termination pursuant to this paragraph shall take effect
immediately upon written notice to Xxxxxx from Employer after the
expiration of such three-month period;
(d) Burman's death, in which case the Agreement shall terminate
immediately; and
(e) The occurrence of a breach of this Agreement on three or more
occasions during any 12-month period of the Term (regardless of whether or
not such breaches are cured in a timely fashion), in which case this
Agreement shall terminate immediately upon written notice to Xxxxxx from
Employer.
In the event Employer exercises its right of termination for reasons other than
any of those specified for in paragraphs (a) through (e) above ("Unstated
Reasons"), such termination shall be effective thirty (30) days after
Employer's delivery of its written notice of such termination; provided,
however, from and after the effective date of a termination for any Unstated
Reason, and continuing for a period of six (6) months (or such longer severance
period as may be applicable to all of the other SRDs, based on Employer's
then-applicable policy at the time of Burman's termination), or through the
Expiration Date, whichever occurs first, Employer shall continue to pay to
Xxxxxx, the Annual Salary and benefits to which he would have been entitled
(under the express terms of this Agreement), but for the accelerated
termination hereof.
6.02 Xxxxxx shall have no right to terminate this Agreement, except (a) as
provided in Sections 6.06 and 6.07 below, and (b) in the event of the occurrence
of a breach of this Agreement by Employer, which Employer does not cure within
ten days after delivery of Burman's written notice of such alleged breach.
Notwithstanding the foregoing, if such breach is not capable of being cured
within such ten-day period, but Employer commences to cure such breach within
five (5) days of Burman's delivery of written notice of such alleged breach, it
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may have such additional time as may be reasonably necessary to complete such
cure, provided Employer acts diligently and in good faith.
6.03 Subject to Article 8, termination of this Agreement by Employer or by
Burman pursuant to any of the provisions of this Article VI shall not prejudice
any other remedy to which the terminating party may be entitled as a result of a
breach of this Agreement by the non-terminating party, whether at law, in
equity, or under this Agreement.
6.04 In the event this Agreement is terminated for any reason, Xxxxxx shall
be entitled to receive a prorated portion of his Annual Salary through the
effective date of such termination. In addition, in the event this Agreement is
terminated for any reason, Xxxxxx shall be entitled to reimbursement of all
business expenses incurred by him (pursuant to Section 5.01) prior to the
effective date of termination that would otherwise be reimbursable hereunder.
Further, Xxxxxx shall also be entitled to the remuneration provided in Sections
6.01, 6.06 and 6.07.
6.05 Upon the termination of this Agreement for any reason, Xxxxxx shall
forthwith return and deliver to Employer, and shall not retain any originals or
copies of, any books, papers, price lists or customer contracts, written
proposals of Employer or prospective customers or tenants, customer/tenant
lists, rent rolls, leases, files, books of account, notebooks and other
documents and data relating to the performance of services rendered by Burman
hereunder, except for those materials relating to the Retained Properties or in
Burman's possession immediately prior to the commencement of the Term
(collectively, "Employer's Materials"), all of which Employer Materials are
hereby deemed to constitute the property of Employer.
6.06 Constructive Termination. If, at any time during the Term, except in
connection with a termination pursuant to Section 6.01(a), (b) or (e) above,
Xxxxxx is Constructively Discharged (as hereinafter defined), then Xxxxxx shall
have the right, by written notice to the Employer, given within one hundred and
twenty (120) days of the effective date of such Constructive Discharge, to
terminate his services hereunder (the "Termination Notice"), effective as of the
date that is thirty (30) days after the date on which such Termination Notice is
delivered, and Xxxxxx shall have no further rights or obligations under this
Agreement other than as provided in this Section 6.06 and in Article VII. For
purposes of this Agreement, Xxxxxx shall be deemed to have been "Constructively
Discharged" upon the occurrence of any of the following events:
(i) Xxxxxx is not re-elected to, or is otherwise removed from,
his position as the SRD in the Territory with the Employer other than
as a result of (x) Burman's election or appointment to positions of
equal or superior scope and responsibility or (y) Burman's breach of,
or default under, the terms of this Agreement; or
(ii) Employer fails to vest Xxxxxx with the powers, authority and
support services normally attendant, from time to time, to the other
SRDs; or
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(iii) The Employer notifies Xxxxxx, in writing, that Burman's
employment will be terminated (other than pursuant to Section 6.01(a),
(b) or (e) above) or materially modified in the future, or that Xxxxxx
will be Constructively Discharged in the future.
If Xxxxxx is Constructively Discharged and timely delivers a
Termination Notice, then from and after the effective date of a
termination pursuant to a Termination Notice, and continuing for a
period of six months or through the Expiration Date, whichever occurs
first, Employer shall continue to pay to Xxxxxx the Annual Salary and
benefits to which he would have been entitled (under the express terms
of this Agreement), but for the accelerated termination hereof.
6.07 Termination Upon Change of Control.
(a) In the event of a Change in Control (as defined below) of the
Employer and the termination of Burman's employment by Xxxxxx or by
the Employer under either (i) or (ii) below, Xxxxxx shall be entitled
to the "Severance Payment" described below. The Severance Payment
shall not be offset against or diminish any other compensation or
benefits accrued as of the effective date of termination. The
following shall constitute termination under this Section 6.07:
(i) Xxxxxx terminates his employment under this Agreement
pursuant to a written notice to that effect delivered to the Board
within six (6) months after the occurrence of the Change in Control;
or
(ii) Burman's employment is terminated, including Constructively
Discharged, by the Employer or its successor either in contemplation
of or within two (2) years after the Change in Control, other than
pursuant to Section 6.01(a), (b) or (e) above.
(b) For purposes of this paragraph, the term "Change in Control" shall mean
the following:
(i) The consummation of the acquisition by any person [as such
term is defined in Section 13(d) or 14(d) of the Securities Exchange
Act of 1934, as amended (the "1934 Act")] of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the 0000 Xxx) of
forty percent (40%) or more of the combined voting power embodied in
the then-outstanding voting securities of the Employer; or
(ii) Approval by the stockholders of the Employer of: (1) a
merger or consolidation of the Employer, if the stockholders of the
Employer immediately before such merger or consolidation do not, as a
result of such merger or consolidation, own, directly or indirectly,
more than fifty percent (50%) of the combined voting power of the
then-outstanding voting securities of the entity resulting from such
merger or consolidation in substantially the same proportion as was
represented by their ownership of the combined voting power of the
voting securities of the Employer outstanding immediately before such
merger or consolidation; or (2) a complete or substantial
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liquidation or dissolution, or an agreement for the sale or other
disposition, of all or substantially all of the assets of the Employer.
Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur solely because forty percent (40%) or more of the combined voting power of
the then-outstanding securities is acquired by: (x) a trustee or other
fiduciary holding securities under one or more employee benefit plans maintained
for employees of the entity; or (y) any corporation or other entity which,
immediately prior to such acquisition, is owned directly or indirectly by the
stockholders of the Employer in the same proportion as their ownership of stock
in the Employer immediately prior to such acquisition. For purposes of this
Section 6.07, the "Severance Payment" shall be deemed to be mean the Annual
Salary and benefits to which Xxxxxx would have been entitled (under the express
terms of this Agreement), but for the accelerated termination hereof, and such
Severance Payment shall be due and payable with respect to and during the period
of time commencing on the effective date of the termination of Burman's
employment under this Section 6.07, and continuing for a period of six (6)
months or through the Expiration Date, whichever occurs first.
ARTICLE VII - NONCOMPETITION AND CONFIDENTIALITY
7.01 Xxxxxx hereby reaffirms his obligations under, and all of the terms
set forth in, Paragraph 25 of the Contribution Agreement.
7.02 Employer acknowledges that heretofore or hereafter during the course
of Burman's employment, Employer has produced, and Xxxxxx may hereafter produce
or have access to, records, data, trade secrets and information not generally
available to the public, including, but not limited to, the Employer's Materials
("Confidential Information"), regarding Employer, its subsidiaries and
affiliates, the business of Employer, and its real properties and tenants in the
Territory and elsewhere in the United States. Accordingly, during and
subsequent to the Term, Burman shall hold in confidence and not directly or
indirectly disclose, copy or make lists of any or all of such Confidential
Information, except to the extent that (i) such information is or hereafter
becomes lawfully available from public sources; (ii) such disclosure is
authorized in writing by Employer; (iii) such disclosure is required by a law or
any competent administrative agency or judicial authority; or (iv) otherwise as
is reasonably necessary or appropriate in connection with the performance by
Xxxxxx of his duties hereunder. All records, files, documents and other
materials or copies thereof relating to Employer's business that Xxxxxx
prepares, has access to, or utilizes (including, but not limited to, the
Employer Materials), shall be and remain the sole property of Employer; and
shall be promptly returned to Employer upon termination of Burman's employment
hereunder. Subject to Section 7.01, during the term of this Agreement, Xxxxxx
agrees to abide by Employer's reasonable policies, as in effect from time to
time and applicable to the SRDs, respecting avoidance of interests conflicting
with those of Employer.
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ARTICLE VIII - ARBITRATION
8.01 Preliminary Dispute Resolution Through Mediation.
(a) Notice of Dispute. If a claim or controversy arises out of,
or relating to, this Agreement, then the party raising or alleging the
existence of the claim or controversy shall give notice to the other
party specifying (in reasonable detail) the nature of the dispute,
including the claim being made or the matter in controversy; the
factual basis for the claim or controversy; any purported damages; and
any requested relief (a "Dispute Notice"). The Dispute Notice must be
given prior to initiating any arbitration concerning the dispute, as
provided in Section 8.02 below. If either party commences any
arbitration concerning a matter covered by this Section 8.01 prior to
sending the required Dispute Notice and mediating in good faith (the
"Non-Complying Party"), such failure constitutes grounds for both
dismissal of the arbitration, and the levy of attorneys' fees, costs,
and expenses against the Non-Complying Party.
(b) Good Faith Negotiations and Mediation. Within 15 days after
delivery of the Dispute Notice, the contesting parties shall make
reasonable and good faith efforts to settle the dispute through
communication and negotiations through a designated representative of
each party to the dispute, each of whom shall have the authority to
settle the dispute. If the dispute is not settled within the 15-day
period (the "Settlement Period"), then the dispute shall be submitted
to a mutually acceptable mediator. Neither party may unreasonably
withhold acceptance of a proposed mediator. If the parties fail to
agree upon a mediator with ten (10) business days after the
expiration of the Settlement Period, each party shall select a
mediator and the two mediators selected by the parties shall promptly
select a third mediator to preside over the mediation. If either
party does not select a mediator within ten (10) business days after
the expiration of the Settlement Period, the mediator selected by the
other party shall preside over the mediation. The cost of the
mediation, and any other subsequent alternative dispute resolution
procedures agreed to by the parties, shall be shared equally, except
as otherwise expressly provided in Section 8.02(d). The parties
shall appear before the selected mediator and engage in mediation in
good faith. The mediation must be completed within 60 days after the
date of the delivery of the Dispute Notice.
8.02 Arbitration As Optional Means Of Resolution.
(a) Arbitration. In the event that the parties fail to agree
upon the resolution of any claim or controversy, notwithstanding
preliminary mediation under Section 8.01 above, then either of them
may then institute arbitration proceedings administered by the
American Arbitration Association (the "Association") under its
Commercial Arbitration Rules (the "Rules"), to resolve the matter in
dispute. Any such arbitration proceeding shall commence by the
delivery by one party of a written notice of demand for arbitration
(the "Arbitration Demand Notice") to the other party. A copy of the
Arbitration Demand Notice shall be simultaneously delivered to the New
York City chapter of the Association, as provided by the Rules.
Arbitration proceedings shall
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commence no later than thirty (30) days after delivery of the
Arbitration Demand Notice, pursuant to procedure set forth below.
(b) The arbitration proceeding shall be conducted in New York
City by a single arbitrator (the "Arbitrator"), who shall be selected
pursuant to the provisions of this Section 8.02(b). The Arbitration
Demand Notice shall direct the Association to assemble a list of five
(5) proposed independent arbitrators, each of whom shall be a member
of the Association and none of whom may be related to, or affiliated
with, any of Employer or Xxxxxx or any affiliates of any of them.
Within ten (10) days of the delivery of the Arbitration Demand Notice,
the Association shall deliver its list of the names of those five (5)
proposed independent arbitrators to each party. No later than ten
(10) days after delivery of said list of proposed independent
arbitrators by the Association to the parties, the parties shall cause
a meeting to occur between their respective spokespersons (or their
authorized representatives), which meeting shall occur at a mutually
convenient location in New York City. At that meeting, the two (2)
spokespersons shall examine the list of five (5) names submitted to
the parties by the Association, and they shall each eliminate two (2)
of those names, and the sole remaining proposed arbitrator shall be
the Arbitrator. In order to eliminate four (4) of the proposed
arbitrators whose names were submitted by the Association, first, the
spokesperson for the party who issued the Arbitration Demand Notice
shall eliminate a proposed arbitrator of his choice and then the other
spokesperson shall eliminate a proposed arbitrator of his choice. The
two (2) spokespersons shall continue to eliminate names from the
Association's list in this manner until each of them has eliminated
two (2) names, and they have thereby selected the Arbitrator through
mutual elimination. The two (2) spokespersons shall immediately
notify the Association, in writing and by telephone, of the name of
the Arbitrator, and they shall direct the Association to contact the
Arbitrator in order to schedule the commencement of the arbitration
proceedings within the required time period described above. In the
event that the chosen Arbitrator is not available to commence the
Arbitration proceedings within a thirty (30) day limit, the parties
shall direct the Association to engage the last eliminated Arbitrator
whose schedule permits commencement of the proceedings within such
thirty (30) day period. In the event any party fails to participate in
the elimination process, the other party may unilaterally choose the
Arbitrator.
(c) In connection with the arbitration proceedings, each party
shall submit, in writing, a description of the dispute(s) giving rise
to the arbitration proceedings, together with the specific requested
resolution that the submitting party seeks with respect to each
component of the dispute or each matter in dispute. The Arbitrator
shall be obligated to choose one (1) party's specific requested
resolution with respect to each component of, or each matter
comprising, the dispute, without being permitted to effectuate any
compromise position as to any such matters or disputes. Except as
otherwise stated in this Section 8.02 and as the parties otherwise
expressly agree in writing, the arbitration proceeding shall be
conducted in accordance with the Rules then in effect. The decision
or award rendered by the Arbitrator shall be final and non-appealable,
and judgment may be entered upon it in accordance with applicable law
in the State of New York, or any other court of competent
jurisdiction.
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(d) The party whose requested resolution is not selected by the
Arbitrator shall bear the cost of all counsel, experts or other
representatives which are retained by the parties in the arbitration
proceeding, together with all other costs of the arbitration
proceeding, including, without limitation, the fees, costs and
expenses imposed or incurred by the Arbitrator (collectively,
"Arbitration Expenses"). If the dispute resolved by the Arbitrator
involves more than one matter, issue or component, then the burden to
pay the Arbitration Expenses shall be allocated between each of
Acquiror and Contributor, in the manner reasonably deemed appropriate
by the Arbitrator in light of the value to each of Acquiror and
Contributor, respectively, of those matters or components for which
their respective requested resolution was not selected.
(e) Unless otherwise agreed in writing, during the period of time
that any arbitration proceeding is pending under this Agreement, the
parties shall continue to comply with all those terms and provisions
of this Agreement which are not the subject of their dispute and the
pending arbitration proceeding.
(f) Subject to Section 9.05, nothing herein contained shall deny
any party the right to seek injunctive or other equitable relief from
a court of competent jurisdiction in the context of a bona fide
emergency or prospective irreparable harm, and such an action may be
filed and maintained notwithstanding or auxiliary to any previously
commenced arbitration proceeding.
Notwithstanding any provision of this Agreement to the contrary, the
obligations of the parties under this Article VIII shall survive termination or
expiration of this Agreement.
ARTICLE IX - GENERAL PROVISIONS
9.01 Any notices to be given under this Agreement by either party to the
other must be in writing and may be effected either by personal delivery or by a
reputable next-day overnight delivery service which obtains a signed receipt for
its deliveries. Notices delivered personally shall be deemed communicated as of
the actual receipt by the addressee. Notices sent by next-day overnight
delivery service shall be deemed communicated on the next business day after
being sent. Notices shall be addressed as follows:
If intended for Xxxxxx:
Xxx Xxxxxx
000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000
X.X. Xxx 000
Xxxxxxx, Xxx Xxxx 00000
If intended for Employer:
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First Industrial Realty Trust, Inc.
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx Xxxxxxx,
Chief Operating Officer
9.02 This Agreement shall be governed by and construed in accordance with
the laws of New York.
9.03 This Agreement is a contract for personal services of Xxxxxx, and as
such, is not assignable by Burman.
9.04 This Agreement shall not be assignable by Employer except with the
prior written approval of an assignment and of the proposed assignee by Xxxxxx.
Notwithstanding the foregoing, Employer may assign its rights under this
Agreement to any entity which acquires title to all of Employer's Real Property
Assets in the Territory, without Burman's prior approval, subject to the
following two (2) conditions:
1. Employer shall stand as surety for the performance of the assignee
under this Agreement; and
2. If, after being informed of the assignment and of the identity of
the assignee, Xxxxxx is not willing to be employed by the assignee, upon three
(3) months' prior written notice to Employer and to the assignee, Xxxxxx may
terminate this Agreement.
9.05 SUBJECT TO SECTION 8.02, THE PARTIES AGREE THAT ALL DISPUTES BETWEEN
ANY OF THEM ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT, AND
WHETHER ARISING IN LAW OR EQUITY OR OTHERWISE, SHALL BE RESOLVED BY STATE OR
FEDERAL COURTS LOCATED IN NEW YORK COUNTY, NEW YORK, BUT THE PARTIES ACKNOWLEDGE
THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT OUTSIDE OF
SUCH COUNTY.
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IN WITNESS WHEREOF, the parties hereto, intending to be legally bound
hereby, have caused this Employment Agreement to be duly signed the day and year
first above written.
FIRST INDUSTRIAL REALTY TRUST, INC.
By: Johannson X. Xxx
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Name: Johannson X. Xxx
Title: Senior Vice President -- Acquisitions
Xxx Xxxxxx
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Xxx Xxxxxx
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