AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit 10.1
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement") is made and entered into effective as of August 14, 2018 by and between REVEN HOUSING REIT, INC., a Maryland corporation (the "Company"), and XXXX XXXXXXXXX (hereinafter, the "Executive").
WHEREAS, commencing on July 2, 2012, the Executive became employed as the Chief Executive Officer of the Company;
WHEREAS, the Executive possesses intimate knowledge of the business and affairs of the Company, its policies, methods and personnel;
WHEREAS, the Board of Directors of the Company (the “Board”) recognizes that the Executive has contributed to the growth and success of the Company, and desires to assure the Company of the Executive's continued employment and to compensate him therefor;
WHEREAS, the Board has determined that this Agreement will reinforce and encourage the Executive's continued attention and dedication to the Company;
WHEREAS, the Executive is willing to make his services available to the Company and on the terms and conditions hereinafter set forth;
WHEREAS, the Executive and the Company entered into that certain Employment Agreement dated March 4, 2013 (the “Prior Agreement”); and
WHEREAS, the Executive and the Company desire to enter into this Agreement to amend certain terms and conditions in the Prior Agreement to clarify the duties of the Executive and certain restrictions related thereto and to conform certain other terms relating to occurrences of disability and death to the Company’s employment agreement(s) with its other senior executive(s).
NOW, THEREFORE, in consideration of the premises and mutual covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are mutually acknowledged, the Company and the Executive hereby agree as follows:
1. Definitions. When used in this Agreement, the following terms shall have the following meanings:
(a) “Accrued Obligations” means:
(i) all accrued but unpaid Base Salary through the end of the Term of Employment;
(ii) any unpaid or unreimbursed expenses incurred in accordance with Company policy, including amounts due under Section 5(a) hereof, to the extent incurred during the Term of Employment;
(iii) any accrued but unpaid benefits provided under the Company’s employee benefit plans, subject to and in accordance with the terms of those plans;
(iv) any unpaid Bonus in respect to any completed fiscal year that has ended on or prior to the end of the Term of Employment; and
(v) rights to indemnification by virtue of the Executive’s position as an officer or director of the Company or its subsidiaries and the benefits under any directors’ and officers’ liability insurance policy maintained by the Company, in accordance with its terms thereof.
(b) “Affiliate” means any entity that controls, is controlled by, or is under common control with, the Company. For the purposes of this definition, the terms “controls,” “is controlled by” or “under common control with” mean possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person whether through the ownership of voting securities, by contract or otherwise. In the event that any entity is deemed to be an Affiliate under this definition, such entity shall not be deemed to be an Affiliate for any other purposes other then as set forth in this Agreement.
(c) “Base Salary” means the salary provided for in Section 4(a) hereof or any increased salary granted to Executive pursuant to Section 4(a) hereof.
(d) “Beneficial Ownership” shall have the meaning ascribed to such term in Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended.
(e) “Bonus” means any bonus payable to the Executive pursuant to Section 4(b) hereof.
(f) “Bonus Period” means each period for which a Bonus is payable. Unless otherwise specified by the Board, the Bonus Period shall be the calendar year
(g) “Cause” means:
(i) a conviction of the Executive of a felony,; or
(ii) willful misconduct or gross negligence by the Executive resulting, in either case, in material economic harm to the Company of any of Related Entities; or
(iii) fraud, embezzlement, theft or dishonesty of a material nature by the Executive against the Company or any Related Entity, or a willful disclosure of material trade secrets or other material confidential information related to the business of the Company resulting, in any case, in material economic harm to the Company or any Related Entity; or
(iv) a willful material breach by the Executive of this Agreement resulting in material economic harm to the Company of any of Related Entities.
2 |
An act or failure to act shall not be “willful” if (i) done by the Executive in good faith or (ii) the Executive reasonably believed that such action or inaction was in the best interests of the Company and the Related Entities.
(h) “Change in Control” means the occurrence of any of the following:
(i) any one Person, or more than one Person acting as a group, acquires ownership of equity securities of the Company that, together with equity securities held by such Person or group, constitutes more than forty percent (40%) of the total fair market value or total voting power of the then outstanding equity securities of the Company entitled to vote in the election of directors of the Company; provided, however, that if any one Person, or more than one Person acting as a group, is considered to own more than forty percent (40%) of the total fair market value or total voting power of the then outstanding equity securities of the Company, the acquisition of additional equity securities by the same Person or Persons will not be considered a Change in Control under this Plan;
(ii) during any period of two (2) consecutive years (not including any period prior to the Commencement Date) individuals who constitute the Board on the Commencement Date (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Commencement Date whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or
(iii) consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Company or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any of its subsidiaries (each a “Business Combination”), in each case, unless, following such Business Combination, all or substantially all of the Persons who were the Beneficial Owners, respectively, of the outstanding Common Stock and outstanding voting securities of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, fifty percent (50%) or more of the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the outstanding Common Stock and outstanding voting securities of the Company, as the case may be.
3 |
Notwithstanding the foregoing, a Change of Control shall not be deemed to have occurred for purposes of this Agreement as the result of the issuance by the Company or any of its subsidiaries of any equity securities or securities convertible into equity securities for cash or property so long as such securities are issued by the Company other than in connection with a transaction that would result in a Change of Control pursuant to this Agreement.
(i) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended from time to time.
(j) “Code” means the Internal Revenue Code of 1986, as amended.
(k) “Commencement Date” means March 4, 2013.
(l) “Common Stock” means the common stock of the Company, par value $.001 per share.
(m) “Confidential Information” means all trade secrets and information disclosed to the Executive or known by the Executive as a consequence of or through the unique position of his employment with the Company or any of its Affiliates (including information conceived, originated, discovered or developed by the Executive and information acquired by the Company or any of its Affiliates from others) prior to or after the date hereof, and not generally or publicly known (other than as a result of unauthorized disclosure by the Executive), about the Company or any or its Affiliates or its business. Confidential Information includes, but is not limited to, inventions, trade secrets, works of authorship, developmental or experimental work, know-how, data, financial information and forecasts, product plans, marketing plans and strategies, customer lists and confidential or proprietary contractual obligations and terms thereof, relating to the Company or any Affiliates, including, but not limited to, financial statements, financial projections, business plans, listings and confidential or proprietary contractual obligations and terms thereof, and components of intellectual property of the Company or any Affiliate.
(n) “Disability” means the inability of the Executive to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.
(o) “Equity Awards” means any stock options, restricted stock, restricted stock units, stock appreciation rights, phantom stock or other equity based awards granted by the Company or any of its Affiliates to the Executive.
(p) “Expiration Date” means the date on which the Term of Employment, including any renewals thereof under Section 3(b), shall expire.
4 |
(q) “Good Reason” means the occurrence of any of the following: (i) a material diminution in the Executive’s base compensation; (ii) a material diminution in the Executive’s authority, duties, or responsibilities; (iii) a material diminution in the authority, duties, or responsibilities of the supervisor to whom the Executive is required to report, including a requirement that the Executive report to a corporate officer or Executive instead of reporting directly to the Board; (iv) a change in the geographic location at which the Executive must perform the services under this Agreement; or (v) any other action or inaction that constitutes a material breach by the Company of this Agreement. For purposes of this Agreement, Good Reason shall not be deemed to exist unless the Executive’s termination of employment for Good Reason occurs within one hundred and eighty (180) days following the initial existence of one of the conditions specified in clauses (i) through (v) above, the Executive provides the Company with written notice of the existence of such condition within sixty (60) days after the initial existence of the condition, and the Company fails to remedy the condition within thirty (30) days after its receipt of such notice.
(r) “Group” shall have the meaning ascribed to such term in Section 13(d) of the Securities Exchange Act of 1934.
(s) “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Securities Exchange Act of 1934 and used in Sections 13(d) and 14(d) thereof.
(t) “Restricted Period” shall be the Term of Employment and the two (2) year period immediately following termination of the Term of Employment.
(u) “Severance Amount” shall mean an amount equal to two (2) times the sum of (A) the Executive’s annual Base Salary as in effect immediately prior to the Termination Date and (B) the Executive’s Target Bonus for the Bonus Period in which termination occurs.
(v) “Target Bonus” means the target annual incentive award opportunity for the applicable Bonus Period.
(w) “Term of Employment” means the period during which the Executive shall be employed by the Company pursuant to the terms of this Agreement.
(x) “Termination Date” means the date on which the Term of Employment ends.
(y) “Termination Payment” means an amount equal to the greater of one percent (1%) of the equity value of the Company upon written notice to the Executive of such termination or $2,000,000.00, less any gross amounts received and/or realized by the Executive in respect of any Equity Awards that are granted to him during the Term of Employment including, without limitation, any amounts received as a result of cashing out of stock options under Section 6(i)(vi) of this Agreement.
(z) “Termination Year Bonus” means Bonus payable under Section 4(b) hereof for the Bonus Period in which the Executive’s employment with the Company terminates for any reason.
5 |
6 |
(i) During the Term of Employment, the Executive shall participate in the Company’s annual incentive compensation plan, program and/or arrangements applicable to senior-level executives as established and modified from time to time by the Compensation Committee of the Board in its sole discretion. During the Term of Employment, the Executive shall have a threshold bonus opportunity under such plan or program equal to 50% of his current Base Salary, a target bonus opportunity (the “Target Bonus”) under such plan or program equal to 100% of his current Base Salary, and a maximum bonus under such plan or program equal to 200% of his current Base Salary, in each case based on satisfaction of performance criteria to be established by the Compensation Committee of the Board within the first 3 months of each fiscal year of the Company that begins during the Term of Employment. Payment of annual incentive compensation awards shall be made in the same manner and at the same time that other senior-level executives receive their annual incentive compensation awards.
(ii) Any Bonus, including without limitation any Termination Year Bonus payable under Section 6 hereof, earned for any calendar year shall be paid in the immediately following calendar year, as soon as practicable after the audited financial statements for the Company for the year for which the Bonus is earned have been released and the Committee has certified that the Bonus has been earned.
(iii) For
the bonus period in which the Executive’s employment with the Company terminates for any reason other than by the Company
for Cause under Section 6(b) hereof, the Company shall pay the Executive a pro rata portion (based upon the period ending on the
date on which the Executive’s employment with the Company terminates) of the bonus otherwise payable under Section 4(b)(1)
for the bonus period in which such termination of employment occurs; provided, however, that (A) the bonus period shall be deemed
to end on the last day of the fiscal quarter of the Company in which the Executive’s employment so terminates, and (B) the
business criteria used to determine the bonus for this short bonus period shall be annualized and shall be determined based upon
unaudited financial information prepared in accordance with generally accepted accounting principles, applied consistently with
prior periods, and reviewed and approved by the Compensation Committee of the Board..
(iv) The Executive shall receive such additional bonuses, if any, as the Compensation Committee may in its sole and absolute discretion determine.
7 |
5. Expense Reimbursement and Other Benefits.
(d) Equity Awards. During the Term of Employment, the Executive shall be eligible to be granted Equity Awards under (and therefore subject to all terms and conditions of) the Reven Housing REIT, Inc. 2012 Incentive Compensation Plan, as may be amended from time to time (the “Equity Plan”) or such other plans or programs as the Company may from time to time adopt, and subject to all rules of regulation of the Securities and Exchange Commission applicable thereto. The number and type of Equity Awards, and the terms and conditions thereof, shall be determined by the Compensation Committee of the Board, in its discretion and pursuant to the Equity Plan or the plan or arrangement pursuant to which they are granted.
8 |
(i) the Accrued Obligations, payable as and when those amounts would have been payable had the Term of Employment not ended;
(ii) the Termination Year Bonus, payable as and when those amounts would have been payable had the Term of Employment not ended;
(iii) a lump-sum payment equal to the Severance Amount, payable on the 30th day immediately following the Termination Date;
(iv) the Company shall reimburse, on a monthly basis, Executive’s COBRA premium under the Company’s major medical group health and dental plan (including the costs of the Executive’s premium required to maintain coverage for his dependents) for a period of 18 months after such termination or the expiration of the period in which COBRA coverage must be provided, whichever is less; and
9 |
(v) all Equity Awards and or stock options previously granted to the Executive that remain outstanding immediately prior to the effective date of Termination shall become fully vested and exercisable upon the occurrence of such Termination and shall remain exercisable for a period of two (2) years thereafter. If, upon the Termination Date, the Company is not a publicly traded corporation, the stock options shall be cancelled and, in exchange, the Company shall pay to the Executive, in full settlement of all rights with respect to the stock options, an aggregate amount in cash equal to the fair market value of a share of the Company’s Common Stock on the Termination Date minus the per share exercise price for the stock options, times the number of shares to which the stock options have not been exercised at the time of the Termination. Such cash payment shall be made within thirty (30) days of the Termination Date.
(i) the Accrued Obligations, payable as and when those amounts would have been payable had the Term of Employment not ended;
(ii) the Termination Year Bonus, payable as and when those amounts would have been payable had the Term of Employment not ended;
(iii) a lump-sum payment equal to the Severance Amount, payable on the 30th day immediately following the Termination Date;
(iv) the Company shall reimburse, on a monthly basis, Executive’s COBRA premium under the Company’s major medical group health and dental plan (including the costs of the Executive’s premium required to maintain coverage for his dependents) for a period of 18 months after such termination or the expiration of the period in which COBRA coverage must be provided, whichever is less; and
(v) all Equity Awards and or stock options previously granted to the Executive that remain outstanding immediately prior to the effective date of Termination shall become fully vested and exercisable upon the occurrence of such Termination and shall remain exercisable for a period of two (2) years thereafter. If, upon the Termination Date, the Company is not a publicly traded corporation, the stock options shall be cancelled and, in exchange, the Company shall pay to the Executive, in full settlement of all rights with respect to the stock options, an aggregate amount in cash equal to the fair market value of a share of the Company’s Common Stock on the Termination Date minus the per share exercise price for the stock options, times the number of shares to which the stock options have not been exercised at the time of the Termination. Such cash payment shall be made within thirty (30) days of the Termination Date.
10 |
(i) The Accrued Obligations, payable as and when those amounts would have been payable had the Term of Employment not ended;
(ii) the Termination Year Bonus, payable as and when those amounts would have been payable had the Term of Employment not ended;
(iii) A lump-sum payment equal to the Severance Amount, payable on the 30th day immediately following the Termination Date; and
(iv) A lump-sum payment equal to the Termination Payment, payable on the thirtieth (30th) day immediately following the Termination Date; and
(v) Continuation of the health benefits provided to Executive and his covered dependents under the Company health plans as in effect from time to time after the date of such termination at the same cost applicable to active employees until the earlier of: (A) the eighteen (18) month anniversary of the Termination Date, or (B) the date the Executive commences employment with any Person and, thus, is eligible for health insurance benefits; provided, however, that as a condition of continuation of such benefits, the Company may require the Executive to elect to continue his health insurance pursuant to COBRA.
11 |
(i) The Accrued Obligations, payable as and when those amounts would have been payable had the Term of Employment not ended;
(ii) the Termination Year Bonus, payable as and when those amounts would have been payable had the Term of Employment not ended;
(iii) A lump-sum payment equal to the Severance Amount, payable on the thirtieth (30th) day immediately following the Termination Date;
(iv) A lump-sum payment equal to the Termination Payment, payable on the thirtieth (30th) day immediately following the Termination Date;
(v) Continuation of the health benefits provided to Executive and his covered dependents under the Company health plans as in effect from time to time after the date of such termination at the same cost applicable to active employees until the earlier of: (A) the eighteen (18) month anniversary of the Termination Date, or (B) the date Executive commences employment with any Person and, thus, is eligible for health insurance benefits; provided, however, that as a condition of continuation of such benefits, the Company may require the Executive to elect to continue his health insurance pursuant to COBRA; and
(vi) All Equity Awards previously granted to the Executive that remain outstanding immediately prior to the effective date of a Change in Control shall become fully vested and exercisable upon the occurrence of such Change in Control and shall remain exercisable for a period of two (2) years thereafter regardless of whether Executive continues to be employed by the Company. If, upon the Change in Control, the Company is not a publicly traded corporation, the stock options shall be cancelled and, in exchange, the Company shall pay to the Executive, in full settlement of all rights with respect to the stock options, an aggregate amount in cash equal to the fair market value of a share of the Company’s Common Stock on the date the Change in Control minus the per share exercise price for the stock options, times the number of shares to which the stock options have not been exercised at the time of the Change in Control. Such cash payment shall be made within thirty (30) days of the effective date of the Change in Control.
12 |
(i) To the extent any such cash payment or continuing benefit to be provided is not “deferred compensation” for purposes of Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately after the date the release is executed and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement had such payments commenced immediately upon the Termination Date, and any payments made thereafter shall continue as provided herein. The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following the Termination Date.
(ii) To the extent any such cash payment or continuing benefit to be provided is “deferred compensation” for purposes of Section 409A of the Code, then such payments or benefits shall be made or commence upon the sixtieth (60) day following the Termination Date. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Termination Date, and any payments made thereafter shall continue as provided herein. The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following the Termination Date.
The Company shall provide that Executive may continue to participate in any benefits delayed pursuant to this Section 6(j) during the period of such delay, provided that the Executive shall bear the full cost of such benefits during such delay period. Upon the date such benefits would otherwise commence pursuant to this Section 6(j), the Company may reimburse the Executive the Company’s share of the cost of such benefits, to the extent that such costs otherwise would have been paid by the Company or to the extent that such benefits otherwise would have been provided by the Company at no cost to the Executive, in each case had such benefits commenced immediately upon the Executive’s Termination Date. Any remaining benefits shall be reimbursed or provided by the Company in accordance with the schedule and procedures specified herein.
13 |
14 |
(c) Ownership of Developments. All processes, concepts, techniques, inventions and works of authorship, including new contributions, improvements, formats, packages, programs, systems, machines, compositions of matter manufactured, developments, applications and discoveries, and all copyrights, patents, trade secrets, or other intellectual property rights associated therewith conceived, invented, made, developed or created by the Executive during the Term of Employment either during the course of performing work for the Company or its Affiliates, or their clients, or which are related in any manner to the business (commercial or experimental) of the Company or its Affiliates or their clients (collectively, the “Work Product”) shall belong exclusively to the Company and its Affiliates and shall, to the extent possible, be considered a work made by the Executive for hire for the Company and its Affiliates within the meaning of Title 17 of the United States Code. To the extent the Work Product may not be considered work made by the Executive for hire for the Company and its Affiliates, the Executive agrees to assign, and automatically assign at the time of creation of the Work Product, without any requirement of further consideration, any right, title, or interest the Executive may have in such Work Product. Upon the request of the Company, the Executive shall take such further actions, including execution and delivery of instruments of conveyance, as may be appropriate to give full and proper effect to such assignment. The Executive shall further: (i) promptly disclose the Work Product to the Company; (ii) assign to the Company or its assignee, without additional compensation, all patent or other rights to such Work Product for the United States and foreign countries; (iii) sign all papers necessary to carry out the foregoing; and (iv) give testimony in support of his inventions, all at the sole cost and expense of the Company. In addition, the Executive agrees that all Work Product which the Executive makes, conceives, reduces to practice or develops (in whole or in part, either alone or jointly with others) during his employment shall be the sole property of the Company to the maximum extent permitted by Section 2870 of the California Labor Code, and hereby assigns such Work Product and all rights therein to the Company. No assignment in this Agreement shall extend to inventions, the assignment of which is prohibited by Labor Code Section 2870. The Company shall be the sole owner of all rights in connection therewith. The Executive has reviewed the notification on Exhibit B and agree that his signature acknowledges receipt of the notification.
15 |
16 |
(a) The Executive’s employment will not conflict with or result in his breach of any agreement to which he is a party or otherwise may be bound;
(b) The Executive has not violated, and in connection with his employment with the Company will not violate, any non-solicitation, non-competition or other similar covenant or agreement of a prior employer by which he is or may be bound; and
(c) In connection with Executive’s employment with the Company, he will not use any confidential or proprietary information that he may have obtained in connection with employment with any prior employer.
In connection with Executive’s employment with the Company, as of the date of the execution of this Amended and Restated Agreement the Executive has not been in violation of any terms this Agreement or performance of his duties.
17 |
11. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of California, without regard to principles of conflict of laws.
12. Jurisdiction and Venue. The parties acknowledge that a substantial portion of the negotiations, anticipated performance and execution of this Agreement occurred or shall occur in San Diego, California, and that, therefore, without limiting the jurisdiction or venue of any other federal or state courts, each of the parties irrevocably and unconditionally (i) agrees that any suit, action or legal proceeding arising out of or relating to this Agreement which is expressly permitted by the terms of this Agreement to be brought in a court of law, shall be brought in the courts of record of the State of California in San Diego County or the court of the United States, Southern District of California; (ii) consents to the jurisdiction of each such court in any such suit, action or proceeding; (iii) waives any objection which it or he may have to the laying of venue of any such suit, action or proceeding in any of such courts; and (iv) agrees that service of any court papers may be effected on such party by mail, as provided in this Agreement, or in such other manner as may be provided under applicable laws or court rules in such courts.
18 |
19 |
22. Section Headings. The article, section and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
(a) Subject to limitations imposed by law, the Company shall indemnify and hold harmless the Executive to the fullest extent permitted by law from and against any and all claims, damages, expenses (including attorneys' fees), judgments, penalties, fines, settlements, and all other liabilities incurred or paid by him in connection with the investigation, defense, prosecution, settlement or appeal of any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and to which the Executive was or is a party or is threatened to be made a party by reason of the fact that the Executive is or was an officer, employee or agent of the Company, or by reason of anything done or not done by the Executive in any such capacity or capacities, provided that the Executive acted in good faith, in a manner that was not grossly negligent or constituted willful misconduct and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The Company also shall pay any and all expenses (including attorney's fees) incurred by the Executive as a result of the Executive being called as a witness in connection with any matter involving the Company and/or any of its officers or directors.
(b) The Company shall pay any expenses (including attorneys' fees), judgments, penalties, fines, settlements, and other liabilities incurred by the Executive in investigating, defending, settling or appealing any action, suit or proceeding described in this Section 26 in advance of the final disposition of such action, suit or proceeding. The Company shall promptly pay the amount of such expenses to the Executive, but in no event later than 10 days following the Executive's delivery to the Company of a written request for an advance pursuant to this Section 25, together with a reasonable accounting of such expenses.
20 |
(c) The Executive hereby undertakes and agrees to repay to the Company any advances made pursuant to this Section 25 if and to the extent that it shall ultimately be found that the Executive is not entitled to be indemnified by the Company for such amounts.
(d) The Company shall make the advances contemplated by this Section 25 regardless of the Executive's financial ability to make repayment, and regardless whether indemnification of the Indemnitee by the Company will ultimately be required. Any advances and undertakings to repay pursuant to this Section 25 shall be unsecured and interest-free.
(e) The provisions of this Section 25 shall survive the termination of the Term of Employment or expiration of the term of this Agreement.
26. Compliance with Section 409A.
(c) 6 Month Delay for Specified Employees.
(i) If the Executive is a “specified employee”, then no payment or benefit that is payable on account of the Executive’s “separation from service”, as that term is defined for purposes of Section 409A, shall be made before the date that is six months after the Executive’s “separation from service” (or, if earlier, the date of the Executive’s death) if and to the extent that such payment or benefit constitutes deferred compensation (or may be nonqualified deferred compensation) under Section 409A and such deferral is required to comply with the requirements of Section 409A. Any payment or benefit delayed by reason of the prior sentence shall be paid out or provided in a single lump sum at the end of such required delay period in order to catch up to the original payment schedule.
21 |
(ii) For purposes of this provision, the Executive shall be considered to be a “specified employee” if, at the time of his or her separation from service, the Executive is a “key employee”, within the meaning of Section 416(i) of the Code, of the Company (or any Person with whom the Company would be considered a single employer under Section 414(b) or Section 414(c) of the Code) any stock in which is publicly traded on an established securities market or otherwise.
(i) Any reimbursements by the Company to the Executive of any eligible expenses under this Agreement that are not excludable from the Executive’s income for Federal income tax purposes (the “Taxable Reimbursements”) shall be made by no later than the last day of the taxable year of the Executive following the year in which the expense was incurred.
(ii) The amount of any Taxable Reimbursements, and the value of any in-kind benefits to be provided to the Executive, during any taxable year of the Executive shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year of the Executive; provided, however, that this requirement shall not be deemed to have been violated with respect to any arrangement for the reimbursement of medical expenses referred to in Section 105(b) of the Code solely because the arrangement provides for the limit on the amount of any medical expenses that may be reimbursed under such arrangement over some or all of the period in which the reimbursement arrangement remains in effect. The right to any Taxable Reimbursements shall not be subject to liquidation or exchange for another benefit.
22 |
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.
COMPANY: | ||
REVEN HOUSING REIT, INC., a Maryland corporation | ||
By: | /s/ Xxxx Xxxxx | |
Name: Xxxx Xxxxx | ||
Title: Chief Financial Officer, Chief Operating Officer and Secretary | ||
EXECUTIVE: | ||
/s/ Xxxx Xxxxxxxxx | ||
Xxxx Xxxxxxxxx |
23 |
EXHIBIT A
1. _______________ (“Executive”), for himself and his family, heirs, executors, administrators, legal representatives and their respective successors and assigns, in exchange for the consideration received pursuant to Sections 6(c) (in the case of Disability), Sections 6(e) or 6(f) (other than the Accrued Obligations) of the Employment Agreement to which this release is attached as Exhibit A (the “Employment Agreement”), to which the Executive would not otherwise be entitled, and except as otherwise set forth in this Agreement, does hereby release and forever discharge _____________________ (the “Company”), its subsidiaries, affiliated companies, successors and assigns, and its current or former directors, officers, employees, shareholders or agents in such capacities (collectively with the Company, the “Released Parties”) from any and all actions, causes of action, suits, controversies, claims and demands whatsoever, for or by reason of any matter, cause or thing whatsoever, whether known or unknown including, but not limited to, all claims under any applicable laws arising under or in connection with Executive’s employment or termination thereof, whether for tort, for breach of express or implied employment contract, wrongful discharge, intentional infliction of emotional distress, or defamation or injuries incurred on the job or incurred as a result of loss of employment. Executive acknowledges that the Company encouraged him to consult with an attorney of his choosing, and through this General Release of Claims encourages him to consult with his attorney with respect to possible claims under the Age Discrimination in Employment Act (“ADEA”) and that he understands that the ADEA is a Federal statute that, among other things, prohibits discrimination on the basis of age in employment and employee benefits and benefit plans. Without limiting the generality of the release provided above, Executive expressly waives any and all claims under ADEA that he may have as of the date hereof. Executive further understands that by signing this General Release of Claims he is in fact waiving, releasing and forever giving up any claim under the ADEA as well as all other laws within the scope of this paragraph 1 that may have existed on or prior to the date hereof. Notwithstanding anything in this paragraph 1 to the contrary, this General Release of Claims shall not apply to (i) any rights to receive any payments or benefits pursuant to Section [ ] of the Employment Agreement, (ii) any rights or claims that may arise as a result of events occurring after the date this General Release of Claims is executed, (iii) any indemnification rights Executive may have as a former officer or director of the Company or its subsidiaries or affiliated companies, (iv) any claims for benefits under any directors’ and officers’ liability policy maintained by the Company or its subsidiaries or affiliated companies in accordance with the terms of such policy, and (v) any rights as a holder of equity securities of the Company.
In addition, Executive hereby acknowledges and agrees that he has read and understand Section 1542 of the Civil Code of the State of California, which reads as follows:
“A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”
In connection with such waiver and the above releases, Executive acknowledges that he is aware that he may hereafter discover facts in addition to or different from those which he now knows or believes to be true, but that it is his intention hereby to fully, finally, and forever settle and release all such claims, matters, disputes, and differences, known or unknown, fixed or contingent, suspected or unsuspected, except as specifically set forth in this Agreement. The release given herein shall be and remain in effect as full and complete releases notwithstanding the discovery or existence of any such additional or different facts.
Executive hereby expressly waives and relinquishes all rights and benefits under that Section and any law or legal principle of similar effect in any jurisdiction with respect to the Executive’s release of unknown and unsuspected claims given in this Release. Executive have been advised by counsel and understand the meaning and consequences of Section 1542 and his waiver of said Section and its protections is knowing and voluntary.
2. Executive represents that he has not filed against the Released Parties any complaints, charges, or lawsuits arising out of his employment, or any other matter arising on or prior to the date of this General Release of Claims, and covenants and agrees that he will never individually or with any person file, or commence the filing of, any charges, lawsuits, complaints or proceedings with any governmental agency, or against the Released Parties with respect to any of the matters released by Executive pursuant to paragraph 1 hereof (a “Proceeding”); provided, however, Executive shall not have relinquished his right to commence a Proceeding to challenge whether Executive knowingly and voluntarily waived his rights under ADEA.
3. Executive hereby acknowledges that the Company has informed him that he has up to twenty-one (21) days to sign this General Release of Claims and he may knowingly and voluntarily waive that twenty-one (21) day period by signing this General Release of Claims earlier. Executive also understands that he shall have seven (7) days following the date on which he signs this General Release of Claims within which to revoke it by providing a written notice of his revocation to the Company.
4. Executive acknowledges that this General Release of Claims will be governed by and construed and enforced in accordance with the internal laws of the State of California applicable to contracts made and to be performed entirely within such State.
5. Executive acknowledges that he has read this General Release of Claims, that he has been advised that he should consult with an attorney before he executes this general release of claims, and that he understands all of its terms and executes it voluntarily and with full knowledge of its significance and the consequences thereof.
6. This General Release of Claims shall take effect on the eighth day following Executive’s execution of this General Release of Claims unless Executive’s written revocation is delivered to the Company within seven (7) days after such execution.
_______________, 20__ |
EXHIBIT B
LIMITED EXCLUSION NOTIFICATION
THIS IS TO NOTIFY you in accordance with Section 2872 of the California Labor Code that the foregoing Agreement between you and the Company does not require you to assign or offer to assign to the Company any invention that you developed entirely on your own time without using the Company’s equipment, supplies, facilities or trade secret information except for those inventions that either:
1. Relate at the time of conception or reduction to practice of the invention to the Company’s business, or actual or demonstrably anticipated research or development of the Company; or
2. Result from any work performed by you for the Company.
To the extent a provision in the foregoing Agreement purports to require you to assign an invention otherwise excluded from the preceding paragraph, the provision is against the public policy of this state and is unenforceable.
This limited exclusion does not apply to any patent or invention covered by a contract between the Company and the United States or any of its agencies requiring full title to such patent or invention to be in the United States.
I ACKNOWLEDGE RECEIPT of a copy of this notification.
Dated: ______________________ | XXXX XXXXXXXXX |
Employee Signature |