EXHIBIT 10.02
CRESCENT REAL ESTATE EQUITIES COMPANY
RESTRICTED STOCK AGREEMENT
FOR
300,000 COMMON SHARES
OF
BENEFICIAL INTEREST, PAR VALUE $0.01 PER SHARE
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XXXX X. XXXX
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FEBRUARY 19, 2002
CRESCENT REAL ESTATE EQUITIES COMPANY
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement (the "Agreement") is entered into
between Crescent Real Estate Equities Company, a Texas trust organized under the
Texas Real Estate Investment Trust Act, as amended (the "Company"), and Xxxx X.
Xxxx ("Xxxx") as of the 19th day of February, 2002 (the "Date of Agreement").
The Company is the sole stockholder of Crescent Real Estate Equities,
Ltd. (the "General Partner"), which is the sole general partner of Crescent Real
Estate Equities Limited Partnership (the "Operating Partnership"), and the owner
of a majority of the outstanding limited partner interests in the Operating
Partnership.
Pursuant to the Employment Agreement dated as of February 19, 2002
("Employment Agreement"), of which this Agreement is attached as an Exhibit,
Xxxx is employed as the "Chief Executive Officer" of the Operating Partnership.
As a part of the transactions and Compensation Package, as defined in the
Employment Agreement ("Compensation Package"), the Operating Partnership, has
requested that the Company provide to Xxxx the ability to earn stock in the
Company to encourage Xxxx to carry out his duties with vigor.
The right to earn the stock described herein is an integral component
of the Compensation Package and is intended to compensate Xxxx for services
performed by Xxxx for the Operating Partnership and the Company from and after
February 19, 2002 and during the term of this Employment Agreement and
thereafter for the postemployment obligations of Xxxx, including confidentiality
and noncompetition, such compensation being expressly contingent on Xxxx'x
fulfillment of these services and other requirements as set forth in the
Employment Agreement. The Compensation Package has been negotiated by the
Company, the Operating Partnership and Xxxx in lieu of much more significant
future cash compensation for the future services of Xxxx. Furthermore, Xxxx'x
ability to earn the stock hereunder shall be prospective only and shall be
earned only while the Employment Agreement is in effect.
The Operating Partnership and the Company have previously discussed
these matters with Xxxx, and Xxxx desires to accept such employment on such
terms.
As part of the Compensation Package and to induce Xxxx to make
enthusiastic and productive efforts for the benefit of the Company and the
Operating Partnership, the Executive Compensation Committee of the Company has
recommended that Xxxx be provided the right to earn restricted stock on the
terms and subject to the conditions set forth in this Agreement.
In consideration of the mutual promises and covenants made herein, the
parties hereby agree as follows:
1. THE PLAN; DEFINITIONS. This Agreement is being entered by and
between the Company and Xxxx pursuant to the provisions of the Third Amended and
Restated 1995 Crescent
Real Estate Equities Company Stock Incentive Plan (the "Plan"), a copy of which
is attached hereto as Exhibit A and incorporated herein by reference. Except as
otherwise expressly provided in this Agreement or unless the context otherwise
clearly requires, capitalized terms used in this Agreement are defined in
Article IX of the Plan.
2. RESTRICTED STOCK. Subject to the terms and conditions hereof and as
part of the Xxxx'x Compensation Package and subject to the terms and conditions
of the Plan, Xxxx has the prospective right to Three Hundred Thousand (300,000)
shares (collectively, the "Restricted Stock") of common shares of beneficial
interest of the Company, par value $.01 per share (the "Common Stock").
3. RESTRICTION PERIOD. Unless the restrictions set forth in Section 5
hereof are earlier waived or lapse pursuant to the provisions of Section 1.9 of
the Plan, during the period commencing on the Date of Agreement and ending on
the date or dates, as the case may be, set forth in Section 4 hereof, the
restrictions described in Section 5 hereof shall apply to the relevant shares of
the Restricted Stock (since there is more than one date in Section 4, each such
period will herein be called a "Restriction Period," and such periods
collectively, the "Restriction Periods").
4. VESTING. The earning of the Restricted Stock and its vesting is
contingent on the continuation of Xxxx'x employment relationship with the
Operating Partnership pursuant to the Employment Agreement and is intended to
retain Xxxx as an officer and employee of the Company and the Operating
Partnership, as appropriate. The right to the Restricted Stock in the future may
be earned by Xxxx from and after the date of the Employment Agreement and this
Agreement on a year-by-year basis, in accordance with the terms of this
Agreement and in consideration of his future services to be provided by Xxxx
after the date of the Employment Agreement. Furthermore, Xxxx'x ability to earn
the Restricted Stock shall be prospective only and shall be earned only while
his Employment Agreement is in effect. Unless the restrictions set forth in
Section 5 hereof are earlier waived or lapse pursuant to the provisions of
Section 1.9 of the Plan, or unless there is a termination of employment
according to the provisions of the Employment Agreement, the restrictions set
forth in Section 5 hereof applicable to the shares of the Restricted Stock shall
lapse and expire for all purposes according to the following schedule:
NUMBER OF SHARES DATE
100,000 February 19, 2005
100,000 February 19, 2006
100,000 February 19, 2007
From and after the dates set forth above on which the restrictions set forth in
Section 5 hereof applicable to the shares of the Restricted Stock shall lapse,
the number of shares set forth to the left of such date or dates, as the case
may be, shall be deemed to be fully earned by Xxxx. From and after the date or
dates, as the case may be, on which the restrictions set forth in Section 5
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hereof are earlier waived or lapse pursuant to the provisions of Section 1.9 of
the Plan, such shares of the Restricted Stock as to which such restrictions have
been earlier waived or lapsed shall be deemed to be fully earned by Xxxx. All of
such fully earned and vested shares described in this paragraph are referred to
collectively herein as the "Earned Shares." From and after the date or dates, as
the case may be, on which the shares of Restricted Stock become Earned Shares,
each of the Earned Shares shall no longer be shares of Restricted Stock subject
to the provisions of this Agreement or the Plan, and each of the Earned Shares
shall no longer be subject to forfeiture to the Company pursuant to Section 6
hereof or the Plan.
5. TRANSFER RESTRICTIONS. From and after the date hereof through and
including the last Restriction Period, Xxxx shall not Transfer (as hereinafter
defined) any of the shares of the Restricted Stock, and any attempt to do so
shall be ineffective. Certificates representing shares of the Restricted Stock
shall bear the legend required by Section 6.1(e) of the Plan. Each of the
certificates representing shares of the Restricted Stock shall be delivered to
the Company, together with a stock power duly endorsed in blank, to be held by
the Company until the Restriction Period or Restriction Periods, as the case may
be, have expired. As used herein, the term "Transfer" means, without limitation,
a voluntary or involuntary sale, assignment, transfer, conveyance, pledge,
hypothecation, encumbrance, disposal, loan, gift, attachment or levy of any of
the shares of the Restricted Stock (other than to or for the benefit of the
Company, one of its Subsidiaries, or Crescent Real Estate Equities Limited
Partnership), including, without limitation, an assignment for the benefit of
creditors of Xxxx, a transfer by operation of law, such as a transfer by will or
under the laws of descent and distribution, an execution of judgment against any
of the shares of the Restricted Stock, or the acquisition of record or
beneficial ownership thereof by a lender of the Restricted Stock, or the
acquisition of record or beneficial ownership thereof by a lender or creditor, a
transfer pursuant to a qualified domestic relations order, or to any decree of
divorce, dissolution or separate maintenance, any property settlement, any
separation agreement or any other agreement with a spouse (except for estate
planning purposes) under which a part or all of the shares of the Restricted
Stock are transferred or awarded to the spouse of Xxxx or are required to be
sold; or a transfer resulting from the filing by Xxxx of a petition for relief,
or the filing of an involuntary petition against such Xxxx, under the bankruptcy
laws of the United States or any other nation.
6. FORFEITURE. In accordance with Section 6.1(b) of the Plan, the
shares of the Restricted Stock that have not become Earned Shares shall be
forfeited to the Company in the event Xxxx Transfers any of the shares of the
Restricted Stock in violation of the restrictions set forth in Section 5 hereof,
or in the event Xxxx ceases to be employed by all of the Operating Partnership,
the General Partner and the Company prior to the expiration of the Restriction
Period or Restriction Periods, as the case may be, unless Xxxx'x termination of
employment is due to the occurrences described in Sections 6(b), 6(c), 6(f) or
6(g) of the Employment Agreement.
7. LAPSE OF RESTRICTIONS. In the event of the occurrences described in
Sections 6(b), 6(c), 6(f) or 6(g) of the Employment Agreement, the restrictions
set forth in Section 5 hereof shall lapse with respect to all of the shares of
the Restricted Stock, and the shares of the Restricted Stock shall cease to be
Restricted Stock and become Earned Shares within the
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meaning of the Plan and shall no longer be subject to forfeiture to the Company
pursuant to Section 6 hereof.
8. RESTRICTIONS ON CORRESPONDING SECURITIES AND ASSETS. Any other
securities or assets (other than any ordinary cash dividends) that are received
by Xxxx with respect to the shares of the Restricted Stock which are still
subject to the restrictions described in Section 5 hereof shall be subject to
the same restrictions, and shall be delivered by Xxxx to the Company as provided
in Section 6.1(e) of the Plan. Any ordinary cash dividends that are payable to
Xxxx with respect to the shares of the Restricted Stock shall be fully vested
even if the shares are still subject to the restrictions set forth in Section 5
hereof, but shall be assigned by Xxxx, and Xxxx hereby assigns them, to the
Operating Partnership to the extent necessary for the payment of interest on any
debt owed by Xxxx to the Operating Partnership. As a condition to the grant of
this Option, Employee covenants and agrees to execute a Second Amended and
Restated Promissory Note as well as an Amended and Restated Security Agreement
and Financing Statement, in the form previously agreed, dated as of even date
herewith, in order to provide that (i) all the Restricted Stock and Earned Stock
hereunder is pledged to secure certain obligations between Xxxx and the Company
or its affiliates ("Company Notes"); (ii) any dividends paid on the Restricted
Stock and Earned Shares shall be immediately pledged to the Company and assigned
to the Operating Partnership to pay any then due interest on Company Notes with
any excess dividends over the amount used to pay interest to be promptly
distributed to Xxxx and (iii) 60% of any proceeds received upon sale of the
Restricted Stock or the Earned Shares shall be used to repay, including
prepayment, of any Company Notes.
9. RIGHTS PRIOR TO EARNING RESTRICTED STOCK. From and after the Date of
Agreement, Xxxx shall be entitled to exercise all voting rights and to receive
payments equal to the dividends attributable to the shares of the Restricted
Stock, subject to forfeiture of the shares of the Restricted Stock as provided
in Section 6 hereof and to the provisions of Section 8. All such rights under
this Section 10 shall terminate if Xxxx has not earned the Restricted Stock by
the dates set forth in paragraph 4 above.
10. INVESTMENT PURPOSE. Xxxx represents and warrants to the Company
that all of the shares of the Restricted Stock earned by Xxxx under this
Agreement shall be for Xxxx'x own account for investment and not with a view to
or for sale in connection with any distribution of the shares of the Restricted
Stock. The stock certificates representing the shares of the Restricted Stock
shall, in addition to bearing the legend required in Section 6.1(e) of the Plan,
bear a legend in substantially the following form:
"The shares of stock represented by this certificate have been acquired
for investment and have not been registered under the Securities Act of
1933 or the securities laws of any state. Such shares may not be sold
or transferred except upon such registration or upon delivery to the
Company of an opinion of counsel satisfactory to the Company that such
registration is not required for such sale or transfer."
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11. ACCEPTANCE OF PLAN. The shares of the Restricted Stock under this
Agreement are granted subject to all of the applicable terms and provisions of
the Plan, and such terms and provisions are incorporated by reference herein.
Xxxx hereby accepts and agrees to be bound by all the terms and conditions of
the Plan.
12. AMENDMENT. This Agreement may only be amended by an instrument in
writing signed by both the Company and Xxxx.
13. INTEGRATION; ENTIRE AGREEMENT. The parties agree that this
Agreement serves as an integral part of the Employment Agreement between
Employee and the Operating Partnership and the Compensation Package contemplated
therein and that the rights under this Agreement form a significant portion of
the consideration for the Employment Agreement between Employer and Employee. As
a result, the terms of this Agreement shall be construed in conjunction with and
consistent with the Employment Agreement and any ambiguities resolved by taking
into account the intent of the parties that the Employment Agreement and the
documents attached thereto, including this Agreement, are part of an integrated
employment and compensation arrangement.
14. MISCELLANEOUS. This Agreement shall be construed and enforced in
accordance with the laws of the State of
Texas and shall be binding upon and
inure to the benefit of any successor or assign of the Company and any executor,
administrator, trustee, guarantor or other legal representative of Xxxx.
Executed as of the day and year first written above.
THE COMPANY:
CRESCENT REAL ESTATE EQUITIES COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
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GRANTEE:
/s/ Xxxx X. Xxxx
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Xxxx X. Xxxx
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Social Security Number of Grantee
Exhibit: The Plan
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