Maguire Properties, Inc. Los Angeles, California 90071 December 31, 2008
Exhibit
99.3
Xxxxxxx
Properties, Inc.
000
Xxxxx Xxxxx Xxx., Xxxxx 0000
Xxx
Xxxxxxx, Xxxxxxxxxx 00000
December
31, 2008
Xx. Xxxxx
Xxxxxxxxxx
[Street
Address]
[City], [State]
[Zip Code]
Re: Amended and
Restated Employment Terms
Dear
Shant:
Effective
as of December 31, 2008 (the “Effective Date”),
this letter (the “Letter”) shall amend
and restate in its entirety that certain employment letter agreement (the “Original Agreement”),
dated July 27, 2004, as amended and restated as of January 17, 2008 and as
further amended as of July 1, 2008, between you and Xxxxxxx Properties, Inc.
(the “REIT”)
and Xxxxxxx Properties, L.P. (the “Operating
Partnership” and together with the REIT, the “Company”). From
and after the Effective Date, you and the Company agree that the Company will
employ you on the terms and conditions set forth in this Letter:
1. Position,
Duties and Responsibilities. You will be employed as Executive
Vice President, Chief Financial Officer of the Company. In the
capacity of Executive Vice President, Chief Financial Officer, you will have
such duties and responsibilities as are normally associated with such
position. Your duties may be changed from time to time by the
Company, consistent with your position. You will report to the Chief
Executive Officer of the Company, and will work at the Company’s principal
offices located in downtown Los Angeles (or such other location in the Los
Angeles area as the Company may determine), except for travel to other locations
as may be necessary to fulfill your responsibilities. At the
Company’s request, you will serve the Company and/or its subsidiaries and
affiliates in other offices and capacities in addition to the
foregoing. In the event that you serve in any one or more of such
additional capacities, your compensation will not be increased beyond that
specified in this Letter. In addition, in the event your service in
one or more of such additional capacities is terminated, your compensation, as
specified in this Letter, will not be diminished or reduced in any manner as a
result of such termination for so long as you otherwise remain employed under
the terms of this Letter.
2. Base
Salary. During your employment with the Company, the Company
will pay you a base salary (the “Base Salary”) of
$250,000 per year through and including December 31, 2008, and increasing to
$350,000 per year effective as of January 1, 2009, less payroll deductions and
all required withholdings, payable in accordance with the Company’s normal
payroll practices and prorated for any partial month of
employment. Your Base Salary may be subject to adjustment pursuant to
the Company’s policies as in effect from time to time.
4. Restricted
Stock Award. You and the Company hereby acknowledge and agree
that the REIT has granted you 17,644 restricted shares of the REIT’s common
stock in satisfaction of the REIT’s obligation under the Original Agreement to
grant you the Restricted Stock (as defined in the Original
Agreement). The terms and conditions of the Restricted Stock are set
forth in a Restricted Stock Agreement, dated January 17, 2008, between you and
the REIT.
5. Additional
Payment. You and the Company hereby acknowledge that the
Company paid you a lump-sum cash payment of $15,000 in connection with your
Original Agreement.
6. Benefits
and Vacation. You will be eligible to participate in all
incentive, savings and retirement plans, practices, policies and programs
maintained or sponsored by the Company from time to time which are applicable to
other similarly situated employees of the Company, subject to the terms and
conditions thereof. You will also be eligible for standard benefits,
such as medical insurance, sick leave, vacations and holidays to the extent
applicable generally to other similarly situated employees of the
Company.
7. Compensation
Gross-Up. The amount of compensation payable to you pursuant
to Sections 2, 3, 4 and 5 above will be “grossed up” as necessary (on an
after-tax basis) to compensate for any additional social security withholding
taxes due as a result of your shared employment by the Operating Partnership,
the REIT and, if applicable, any subsidiary and/or affiliate
thereof. If any amounts become payable to you pursuant to this
Section 7, then such amounts shall be paid to you promptly following the
remittance of such taxes to the appropriate taxing authority, but in no event
later than the end of the calendar year following that in which any such
remittance is made.
8. Confidential
and Proprietary Information. As a condition of your employment
with the Company, you agree that during the term of such employment and any time
thereafter, you will not directly or indirectly disclose or appropriate to your
own use, or the use of any third party, any trade secret or confidential
information concerning the REIT, the Operating Partnership, Xxxxxxx Properties
Services, Inc., a Maryland corporation, their respective subsidiaries or
affiliates (collectively, the “Xxxxxxx Group”) or
their businesses, whether or not developed by you, except as it is required in
connection with your services rendered for the Company. You further
agree that, upon termination of your employment, you will not receive or remove
from the files or offices of the Xxxxxxx Group any originals or copies of
documents or other materials maintained in the ordinary course of business of
the Xxxxxxx Group, and that you will return any such documents or materials
otherwise in your possession. You further agree that, upon
termination of your employment, you will maintain in strict confidence the
projects in which any member of the Xxxxxxx Group is involved or
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contemplating. You
hereby acknowledge that irreparable injury will result to the Company in the
event of a breach by you of your obligations under this Section 8 or Section 9
below, that monetary damages for such breach would not be readily calculable,
and that the Company would not have an adequate remedy at law
therefor. You further acknowledge, consent and agree that in the
event of such breach, or the threat thereof, the Company shall be entitled, in
addition to any other legal remedies and damages available, to specific
performance thereof and to temporary and permanent injunctive relief (without
the necessity of posting a bond) to restrain the violation or threatened
violation of such obligations by you.
9.
Non-Solicitation. You
further agree that during the term of such employment and for six months after
your employment is terminated, you will not directly or indirectly solicit,
induce, or encourage any employee, consultant, agent, customer, vendor, or other
parties doing business with any member of the Xxxxxxx Group to terminate their
employment, agency, or other relationship with the Xxxxxxx Group or such member
or to render services for or transfer their business from the Xxxxxxx Group or
such member and you will not initiate discussion with any such person for any
such purpose or authorize or knowingly cooperate with the taking of any such
actions by any other individual or entity.
10. At-Will
Employment. Your employment with the Company is “at-will,” and
either you or the Company may terminate your employment for any reason
whatsoever (or for no reason) by giving 30 days prior written notice of such
termination to the other party. This at-will employment relationship
cannot be changed except in a writing signed by you and an authorized
representative of the Company.
11. Termination
of Employment Without Cause.
(a) Severance
Payment. Subject to Section 11(c) below, if, during the period
of your employment with the Company, you incur a “separation from service” from
the Company (within the meaning of Section 409A(a)(2)(A)(i) of the Internal
Revenue Code of 1986, as amended (the “Code”), and Treasury
Regulation Section 1.409A-1(h)) (a “Separation from
Service”) by reason of a termination of your employment by the Company
without Cause (as defined below), then, in addition to any other amounts payable
to you through the date of termination of your employment, the Company will pay
you a lump-sum cash severance payment within 60 days after the date of your
Separation from Service (such date, the “Termination Date”)
(with the exact payment date to be determined by the Company in its discretion)
in an amount equal to the sum of (x) 100% of your Base Salary (at the rate in
effect immediately prior to your Separation from Service), plus (y) 50% of your
target Annual Bonus (assuming that you had remained employed) for the year in
which the Termination Date occurs.
Notwithstanding
the foregoing, in no event shall you or your estate or beneficiaries be entitled
to any such payments set forth in Sections 11(a)(x) and (y) hereof upon any
termination of your employment by reason of your total and permanent disability
or your death. Notwithstanding the foregoing, in no event shall
payment of the amounts provided for in Sections 11(a)(x) and (y) hereof be
required to be made unless you execute and deliver to the Company a release of
claims in a form reasonably acceptable to the Company (the “Release”) within
twenty-one (21) days (or, to the extent required by applicable law, forty-five
(45) days) following the Termination Date and you not revoke such Release within
seven (7) days thereafter.
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(i) your
willful and continued failure to substantially perform your duties with the
Company (other than any such failure resulting from your incapacity due to
physical or mental illness), after a written demand for substantial performance
is delivered to you by the Company, which demand specifically identifies the
manner in which the Company believes that you have not substantially performed
your duties;
(ii) your
willful commission of an act of fraud or dishonesty resulting in economic or
financial injury to the Company or its subsidiaries or affiliates;
(iii) your
conviction of, or entry by you of a guilty or no contest plea to, the commission
of a felony or a crime involving moral turpitude;
(iv) a
willful breach by you of your fiduciary duty to the Company which results in
economic or other injury to the Company or its subsidiaries or affiliates;
or
(v) your
willful and material breach of your covenants set forth in Section 8 or 9
above.
For
purposes of this provision, no act or failure to act on your part will be
considered “willful” unless it is done, or omitted to be done, by you in bad
faith or without reasonable belief that your action or omission was in the best
interests of the Company.
(c) Six Month
Delay. Notwithstanding anything to the contrary in this
Letter, no compensation or benefits, including without limitation any severance
payments or benefits payable under Section 11(a) hereof, shall be paid to you
during the 6-month period following your Separation from Service if the Company
determines that paying such amounts at the time or times indicated in this
Letter would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the
Code. If the payment of any such amounts is delayed as a result of
the previous sentence, then on the first business day following the end of such
6-month period (or such earlier date upon which such amount can be paid under
Section 409A of the Code without resulting in a prohibited distribution,
including as a result of your death), the Company shall pay you a lump-sum
amount equal to the cumulative amount that would have otherwise been payable to
you during such period.
12. Company
Rules and Regulations. As an employee of the Company, you
agree to abide by Company rules and regulations as set forth in the Company’s
Employee Handbook or as otherwise promulgated.
13. Payment of
Financial Obligations. The payment or provision to you by the
Company of any remuneration, benefits or other financial obligations pursuant to
this Letter will be allocated to the Operating Partnership, the REIT and, if
applicable, any subsidiary and/or affiliate thereof in accordance with the
Employee Sharing and Expense Allocation Agreement, by and between the REIT, the
Operating Partnership, and Xxxxxxx Properties Services, Inc., as in effect from
time to time.
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14. Arbitration. Except
as set forth in Section 8 above, any disagreement, dispute, controversy or claim
arising, out of or relating to this Letter or the interpretation of this Letter
or any arrangements relating to this Letter or contemplated in this Letter or
the breach, termination or invalidity thereof shall be settled by final and
binding arbitration administered by JAMS/Endispute in Los Angeles, California in
accordance with the then existing JAMS/Endispute Arbitration Rules and
Procedures for Employment Disputes. In the event of such an
arbitration proceeding, you and the Company shall select a mutually acceptable
neutral arbitrator from among the JAMS/Endispute panel of
arbitrators. In the event you and the Company cannot agree on an
arbitrator, the Administrator of JAMS/Endispute will appoint an
arbitrator. Neither you nor the Company nor the arbitrator shall
disclose the existence, content, or results of any arbitration hereunder without
the prior written consent of all parties. Except as provided herein,
the Federal Arbitration Act shall govern the interpretation, enforcement and all
proceedings. The arbitrator shall apply the substantive law (and the
law of remedies, if applicable) of the state of California, or federal law, or
both, as applicable, and the arbitrator is without jurisdiction to apply any
different substantive law. The arbitrator shall have the authority to
entertain a motion to dismiss and/or a motion for summary judgment by any party
and shall apply the standards governing such motions under the Federal Rules of
Civil Procedure. The arbitrator shall render an award and a written,
reasoned opinion in support thereof. Judgment upon the award may be
entered in any court having jurisdiction thereof.
15. Withholding. The
Company may withhold from any amounts payable under this Letter such federal,
state, local or foreign taxes as shall be required to be withheld pursuant to
any applicable law or regulation.
16. Entire
Agreement. As of the Effective Date, this Letter and the
employment terms set forth herein, together with the Restricted Stock Agreement,
comprise the final, complete and exclusive agreement between you and the Company
with respect to the subject matter hereof and replace and supersede any and all
other agreements, offers or promises, whether oral or written, made to you by
any member of the Xxxxxxx Group, including without limitation, the Original
Agreement. You agree that any such agreement, offer or promise
between you and any member of the Xxxxxxx Group (or any representative thereof),
including without limitation, the Original Agreement, is hereby terminated and
will be of no further force or effect, and you acknowledge and agree that upon
your execution of this Letter, you will have no right or interest in or with
respect to any such agreement, offer or promise. This Letter may not
be modified unless in writing and signed by both you and a duly authorized
representative of the Company.
17. Choice
of Law. This Letter (including any claim or controversy
arising out of or relating to this Letter) shall be construed, interpreted and
the rights of the parties determined in accordance with the laws of the State of
California (without regard to conflict of law principles that would result in
the application of any law other than the law of the State of
California).
18. Proof of
Right to Work. As required by law, this offer of employment is
subject to satisfactory proof of your right to work in the United
States.
19. Code Section
409A.
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(b) To
the extent permitted under Section 409A of the Code, any separate payment or
benefit under this Letter or otherwise shall not be deemed “nonqualified
deferred compensation” subject to Section 409A of the Code and Section 11(c)
hereof to the extent provided in the exceptions in Treasury Regulation Section
1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or
provision of Section 409A of the Code.
(c) To
the extent that any payments or reimbursements provided to you under this Letter
are deemed to constitute compensation to which Treasury Regulation Section
1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed to you
reasonably promptly, but not later than December 31 of the year following the
year in which the expense was incurred. The amounts of any such
payments eligible for reimbursement in one year shall not affect the payments or
expenses that are eligible for payment or reimbursement in any other taxable
year, and your right to such payments or reimbursement shall not be subject to
liquidation or exchange for any other benefit.
20. Notices. All
notices and other communications hereunder shall be in writing and shall be
given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
If to
you: at your most recent address on the records of the
Company
If to the REIT or the
Operating Partnership:
Xxxxxxx Properties, Inc.
000 Xxxxx Xxxxx Xxxxxx, Xxx.
0000
Xxx Xxxxxxx,
XX 00000
Attn: General Counsel
with a copy to:
Xxxxxx & Xxxxxxx
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Xxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxxxx
or to
such other address as either party shall have furnished to the other in writing
in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
21. Counterparts. This
Letter and any agreement referenced herein may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original but which
together shall constitute one and the same instrument.
[SIGNATURE PAGE
FOLLOWS]
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| Sincerely, | ||
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XXXXXXX
PROPERTIES, INC.,
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a
Maryland corporation
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By:
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/s/ XXXXXXX X. XXXXXXX
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Name:
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Xxxxxxx
X. Xxxxxxx
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Title
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Executive
Vice President, Operations
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XXXXXXX PROPERTIES,
L.P.,
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a
Maryland limited partnership
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By:
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Xxxxxxx
Properties, Inc.
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Its:
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General
Partner
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By:
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/s/ XXXXXXX X. XXXXXXX
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Name:
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Xxxxxxx
X. Xxxxxxx
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Title
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Executive
Vice President, Operations
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Accepted
and Agreed,
this
31st
day of December, 2008.
By: /s/ XXXXX
XXXXXXXXXX
Xxxxx Xxxxxxxxxx
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