EXHIBIT 10.11
EXECUTION COPY
RESIGNATION AGREEMENT
THIS RESIGNATION AGREEMENT, dated as of December 9, 2002 (the
"Resignation Agreement"), by and among Trizec Properties, Inc. (formerly known
as TrizecHahn Corporation), a Delaware corporation (the "Company"), and Xxxxxxx
X. Xxxxxx (the "Executive").
WHEREAS, the Company and the Executive are parties to a certain
assignment of employment agreement, dated May 8, 2002 (which includes, as
Exhibit I, provisions relating to termination following a change in control of
TrizecHahn Corporation and, as Exhibit II, an employment agreement dated May 22,
2001 between the Executive and TrizecHahn Corporation), relating to the role of
the Executive as Chief Financial Officer for the Company (the "Agreement");
WHEREAS, the Company recognizes the Executive's significant
contributions to the Company;
WHEREAS, the Company and the Executive have agreed to the Executive's
resignation from service as an officer of the Company, effective as of December
13, 2002;
WHEREAS, the parties intend that this Resignation Agreement shall set
forth the terms regarding the Executive's resignation.
NOW, THEREFORE, in consideration of the covenants and agreements
hereinafter set forth in this Resignation Agreement, the parties hereto hereby
agree as follows:
1. RESIGNATION
The Executive hereby resigns from his position as Chief Financial
Officer of the Company and from any other positions as an employee, officer or
director of the Company or any of its subsidiaries or affiliated companies,
effective as of December 13, 2002 (the "Effective Date"). As of the Effective
Date, the Agreement shall become null and void and have no further force or
effect; provided, however, that nothing herein shall affect the continued
validity and effectiveness of that certain Confidentiality/Nondisclosure
Agreement and Release, dated May 8, 2002, by and between the Executive and
Trizec Xxxx Corporation.
2. SEVERANCE PAYMENT
In consideration of the covenants set forth herein, the waiver and
release set forth below, and provided that the Executive does not revoke this
Resignation Agreement during the Revocation Period (as defined below), the
Executive shall receive a total cash severance payment of $1,350,170.64, less
applicable deductions for federal, state and local taxes and other authorized
deductions (the "Severance Payment").
The Severance Payment is comprised of the following amounts, in each
case less applicable deductions for federal, state and local taxes and other
authorized deductions:
(a) base salary for 12 months totaling $550,000;
(b) bonus for 12 months totaling $385,000;
(c) present cash value of benefits totaling $16,170.64;
(d) car allowance for 12 months totaling $24,000;
(e) 2002 pro-rata bonus totaling $375,000.
Within two (2) business days following the completion of the Revocation
Period, as set forth below, the Executive shall receive a lump sum payment (less
applicable deductions for federal, state and local taxes and other authorized
deductions) of the Severance Payment. In the event that Executive dies
subsequent to his signing this Resignation Agreement, but before the Severance
Payment is paid, the Severance Payment and other benefits payable hereunder
shall be paid or provided to his estate.
3. HEALTH CARE AND LIFE INSURANCE BENEFITS; COBRA.
The Executive is entitled to continued coverage under the Company's
group health, vision and dental plans for a period of 18 months or until the
Executive secures other employment or becomes eligible under another group plan,
whichever occurs first. During this 18 month period, the Executive will be
responsible for the entire cost of the COBRA premium.
The continuation of the health and dental benefits, described above,
shall run concurrently with the Executive's right to continuation of such
benefits, as provided under Federal law (i.e., COBRA). In other words, the
Executive's COBRA benefits shall commence as of the first day of the month
following the Effective Date (i.e., January 1, 2003) and may continue for a
period of up to 18 months, or as otherwise provided under federal law.
The Company will pay the Executive an amount equal to the present cash
value of all benefits provided to the Executive immediately prior to the
termination of his employment, determined on an annual basis. Such amount has
been specified and included in Section 2 of this Resignation Agreement.
Based on these provisions, the Executive acknowledges his obligation to
notify the Company when he secures alternative employment. Any such
communication should be directed in writing to the Company to the attention of
Xxxxxxx Xxxxxxx.
4. STOCK OPTIONS.
With respect to stock options for Five Hundred Ninety Thousand
(590,000) Company shares and One Hundred Thousand (100,000) shares of Trizec
Canada, granted to the Executive as described on Exhibit A attached hereto and
made a part hereof, all of those stock
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options shall be fully vested on the Effective Date and the Executive shall have
until December 13, 2003 to exercise the Executive's vested stock options.
5. 401(K) PLAN.
Salary deferrals into the 401(k) plan cease as of the Effective Date
and will be fully vested. The Executive may obtain a current statement of the
Executive's account balance by calling New York Life Benefits Complete at (800)
294-3575.
6. DEFERRED COMPENSATION PLAN.
Salary and/or incentive compensation deferrals into the Deferred
Compensation Plan cease at the Effective Date. Distributions of the Executive's
account balance are paid out in either quarterly installments or a lump sum
(depending on the Executive's previous election) as soon as practicable
following the end of the quarter in which the Effective Date occurs. All
distributions are treated as "ordinary income" subject to federal and state tax
at the time of distribution. The Executive may obtain the Executive's current
account balance by calling TBG Financial at (000) 000-0000 or by checking the
website at xxx.xxxxxxxxxxxx.xxx.
7. UNUSED VACATION.
Based on the Executive's termination of employment, the Executive will
receive a lump sum payment equal to the Executive's accrued but unused vacation
totaling 135.30 hours through November 29, 2002, as adjusted for any vacation
time utilized through December 13, 2002 and for additional vacation time accrued
through December 13, 2002 (less applicable deductions for federal, state and
local taxes and other authorized deductions). This will be payable to the
Executive on the day the Executive is paid the Severance Payment.
8. OTHER.
The Executive may take his cell phone (and related charger and other
attachments). Upon the Effective Date, the Executive will be responsible for the
charges related to use of the Executive's cell phone. In addition, through
December 13, 2003, the Company shall maintain a mutually agreed automatic reply
message on the Executive's current Company e-mail address and current Company
phonemail number.
9. GENERAL RELEASE BY EXECUTIVE; LIMITED RELEASE BY COMPANY;
INDEMNIFICATION; CONFIDENTIALITY; ARBITRATION.
The Executive acknowledges and agrees that in order to select and
receive the severance benefits described in this Resignation Agreement, a
general release is required as a condition for such benefits. Thus, by executing
this Resignation Agreement, the Executive agrees to give a general release as
provided herein and hereby agrees that he has no claims against the Company, its
predecessors, successors or assigns, affiliated companies, and their respective
officers, directors, agents and employees, and by execution of this Resignation
Agreement the Executive agrees to waive and release any such claims, except
relating to the Severance Payment and the benefits specified in this Resignation
Agreement.
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The Executive understands and agrees that this general release extends
to all claims, demands, liabilities and causes of action of every kind, nature
and description whatsoever, whether known, unknown or suspected to exist, which
he ever had or may now have against the Company and/or any related entities,
their successors or assigns, and their respective officers, directors, agents
and employees, including, without limitation, any claims, demands, liabilities
and causes of action arising from his employment with the Company and the
termination of that employment, including any claims for severance or vacation
pay, business expenses, and/or pursuant to any federal, state, county, or local
employment laws, regulations, executive orders, or other requirements,
including, but not limited to, Title VII of the 1964 Civil Rights Act, the 1866
Civil Rights Act, the Age Discrimination in Employment Act as amended by the
Older Workers Benefit Protection Act ("ADEA"), the Americans with Disabilities
Act, the Civil Rights Act of 1991, any other local, state or federal fair
employment laws, and any contract, tort, or other claims.
It is further understood and agreed that the Executive is expressly
waiving any right to initiate an action in state or federal court by the
Executive or on his behalf alleging discrimination on the basis of race, sex,
religion, national origin, age, disability, marital status, or any other
protected status or involving any contract, tort or other claims based on the
termination of the Executive from the Company. It is also acknowledged that the
Executive's termination is not in any way related to any work-related injury.
As additional consideration for the Executive's signing this
Resignation Agreement, the Company releases and forever discharges the Executive
from, and agrees not to xxx the Executive with respect to, any and all claims,
demands, rights and causes of action of any nature whatsoever, known or unknown,
asserted or unasserted, arising from any act occurring before the execution of
this Resignation Agreement, including any act connected with the Executive's
employment by the Company and the facts and circumstances surrounding
resignation from that employment. This release also expressly includes any
claims for punitive or compensatory damages, equitable relief or attorneys' fees
or other expenses incurred by the Company. This release does not include future
claims for breach of this Resignation Agreement or any claims, demands, rights
and causes of action of any nature whatsoever arising from, relating to or
constituting an act of willful or criminal misconduct by the Executive that is
currently unknown to the Chief Executive Officer of the Company.
The Company agrees to indemnify and hold harmless the Executive to the
maximum extent permitted by its bylaws and applicable law, against all costs,
charges or expenses incurred or sustained by the Executive in connection with
any action, suit or proceeding to which the Executive may be made a party by
reason of the Executive's employment with the Company, provided that such
indemnity shall not apply to any claim arising out of the Executive's criminal
conduct.
The Executive agrees that he will not make any statement or issue any
communication, written or otherwise, that disparages, criticizes or otherwise
reflects adversely or encourages any adverse action against the Company and/or
its senior management, except if testifying truthfully under oath pursuant to
any lawful court order or subpoena or otherwise responding to or providing
disclosures required by law. The Company agrees that from and after the date of
this Resignation Agreement the directors and officers of the Company at the
level of
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Senior Vice President and above will not make any statement or issue any
communication, written or otherwise, that disparages, criticizes or otherwise
reflects adversely or encourages any adverse action against the Executive,
except if testifying truthfully under oath pursuant to any lawful court order or
subpoena or otherwise responding to or providing disclosures required by law and
that the Company will use reasonable efforts to prevent other officers from
making or republishing any such disparaging statements.
The Executive further acknowledges that, in the course of his
employment at the Company, he has come to know or have access to certain
information which is proprietary to the Company, including, but not limited to,
confidential personnel information, confidential tenant information,
confidential financial information and projects, computer software and
databases, information concerning pending or potential transactions, marketing
techniques and strategies, and other confidential information of the Company. As
consideration for the Severance Payment and the benefits set forth in this
Resignation Agreement, the Executive agrees not to disclose this information to
anyone and not to use this information for any personal or business purpose.
It is further understood that the Executive agrees to maintain the
confidentiality of the terms of this Resignation Agreement, including
nondisclosure of this Resignation Agreement or the terms therein, to any former,
current, or future employees of the Company, it being understood that this
provision shall not preclude the Executive from discussing the contents of this
Resignation Agreement with his spouse, attorney or any tax advisor, except that
they are to be advised of the confidentiality requirements herein, or to the
extent required by law or lawful court order. The Company agrees to maintain the
confidentiality of the terms of this Resignation Agreement, including
nondisclosure of this Resignation Agreement or the terms therein, it being
understood that this provision shall not preclude the Company from discussing
the contents of this Resignation Agreement with its employees on a strict
need-to-know basis, its attorneys or any tax advisor, except that they are to be
advised of the confidentiality requirements herein, or to the extent required by
law or lawful court order.
The Company and the Executive agree to be obligated to resolve any
disputes relating to any matters set forth in this Resignation Agreement and/or
concerning any matters arising out of the Executive's employment at the Company
through binding arbitration with a single arbitrator in New York, New York,
pursuant to the National Rules For The Resolution Of Employment Disputes of the
American Arbitration Association. In any such arbitration, the arbitrator shall
have the discretionary authority to award reasonable attorneys' fees, costs and
expenses to the prevailing party.
10. ACKNOWLEDGEMENT. By signing this Resignation Agreement, the
Executive acknowledges and confirms that:
(i) the Executive was advised by the Company in
connection with the termination of his employment to consult with an
attorney of the Executive's choice prior to signing this Resignation
Agreement and to have such attorney explain the terms of this
Resignation Agreement, including, without limitation, the terms
relating to the Executive's release of claims arising under ADEA;
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(ii) the Executive has no employment discrimination or other
complaints or charges against the Company or any of its subsidiaries or
affiliated companies pending before any local, state, federal or foreign court,
tribunal or administrative agency;
(iii) the Executive has been given not less than twenty-one days to
consider the terms of this Resignation Agreement and to consult with an attorney
of the Executive's choosing with respect thereto;
(iv) the making of any changes to this Resignation Agreement did
not lengthen the twenty-one day period the Executive was given to consider the
Resignation Agreement;
(v) during the Revocation Period the Executive has the option to
revoke acceptance of this Resignation Agreement in accordance with the terms set
forth below;
(vi) the Executive is providing the release and discharge of ADEA
claims only in exchange for consideration which exceeds any consideration which
the Executive is or might otherwise be entitled to under any policy, plan or
procedure of the Company; and
(vii) the Executive has read this Resignation Agreement carefully
and completely, understands each of the terms of the offer and this Resignation
Agreement and knowingly and voluntarily accepted the terms of this Resignation
Agreement.
11. REVOCATION
The Executive shall have the right to revoke this Resignation Agreement
during the seven-day period commencing on the date the Executive signs and
delivers this Resignation Agreement to the Company (the "Revocation Period").
The Revocation Period shall expire at 5:00 p.m. Eastern Standard Time on the
last day of the Revocation Period. In the event of any such revocation by the
Executive, all obligations of the Company under this Resignation Agreement shall
terminate and be of no further force and effect as of the date of such
revocation. No such revocation will be effective unless it is in writing and
signed by the Executive and received by the Company prior to the expiration of
the Revocation Period.
12. SEVERABILITY
Each provision of this Resignation Agreement shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Resignation Agreement is held to be prohibited by or invalid
under applicable law, such provision shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Resignation Agreement. If any of
the provisions contained in this Resignation Agreement shall be determined by a
court of competent jurisdiction to be excessively broad as to duration,
activity, geographic application or subject matter, such provision shall be
construed, by limiting or reducing it to the extent legally
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permitted, so as to make such provision enforceable to the extent compatible
with then-applicable law.
13. REPRESENTATION
The Executive represents that as of the Effective Date he does not have
any knowledge of any accounting irregularities in the Company's accounts (other
than immaterial items that did not affect the overall accuracy of the Company
accounts), and that, as of November 14, 2002, the Company had implemented
adequate internal controls and disclosure controls to satisfy the requirements
of the Securities Exchange Act of 1934.
14. COOPERATION
The Executive agrees that, following the Effective Date, he shall make
himself reasonably available to reasonably assist and cooperate with the Company
in connection with any matters relating to the business or affairs of the
Company, and any pending or future governmental or regulatory investigation,
civil or administrative proceeding, litigation or arbitration related to the
business of the Company during the Executive's term as an officer thereof. The
Executive shall provide such assistance and cooperation at such time and place
and in such manner as may be reasonably requested, in good faith, from time to
time by the Company, taking into consideration the Executive's other business
and personal commitments and the needs of the Company. The Company shall
reimburse the Executive for reasonable out-of-pocket expenses incurred in
connection with the provision of such cooperation and assistance and pay a
reasonable per diem fee, as agreed upon between the Company and the Executive.
15. NOTICES
For the purpose of this Resignation Agreement, notices, demands and all
other communications provided for in this Resignation Agreement shall be in
writing and shall be sent by messenger, overnight courier, certified or
registered mail, or postage prepaid and return receipt requested to the parties
at their respective addresses set forth below or to such other address or tax
number as to which notice is given.
If to the Company: Trizec Properties, Inc.
Sears Tower
000 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Chief Executive Officer
If to the Executive: Xx. Xxxxxxx X. Xxxxxx
000 Xxx Xxxx
Xxxxxxxxxx, XX 00000-0000
Notices, demands and other communications shall be deemed given on
delivery thereof.
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16. ENTIRE AGREEMENT
This Resignation Agreement (including the relevant provisions of the
stock option agreements and pension plans incorporated herein by reference)
represents the entire agreement of the parties concerning the subject matter of
this Resignation Agreement and shall supersede any and all previous contracts,
arrangements or understandings with respect to such subject matter between the
Company and the Executive, including, without limitation, the Agreement.
17. AMENDMENT
This Resignation Agreement may be amended at any time by mutual written
agreement of the parties hereto.
18. GOVERNING LAW
The provisions of this Resignation Agreement shall be construed in
accordance with, and governed by, the laws of the State of New York, without
regard to principles of conflict of laws.
19. COUNTERPARTS
This Resignation Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
20. ASSIGNMENT
This Resignation Agreement may not be assigned by either party without
the prior, express written consent of the other party.
21. SURVIVORSHIP
The respective rights and obligations of the parties hereunder shall
survive any termination or expiration of this Resignation Agreement to the
extent necessary to the intended preservation of such rights and obligations.
22. CONSTRUCTION
The parties acknowledge that this Resignation Agreement is the result
of arm's-length negotiations between sophisticated parties each afforded the
opportunity to utilize representation by legal counsel. Each and every provision
of this Resignation Agreement shall be construed as though both parties
participated equally in the drafting of same, and any rule of construction that
a document shall be construed against the drafting party shall not be applicable
to this Resignation Agreement.
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IN WITNESS WHEREOF, the Company and the Executive, intending to be
legally bound, have executed this Resignation Agreement on the day and year
first above written.
TRIZEC PROPERTIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President and CEO
XXXXXXX X. XXXXXX
/s/ Xxxxxxx X. Xxxxxx
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EXHIBIT A
XXXXXXX X. XXXXXX
SCHEDULE OF STOCK OPTIONS AND ORIGINAL TERMS(1)
OPTIONED OPTION EXERCISABLE
SHARES PRICE FROM AND AFTER EXPIRATION DATE
100,000 US$ 16.24 May 11, 2002 May 11, 2008
30,000 US$ 16.34 January 9, 2003 January 9, 2009
200,000 US$ 17.20 May 11, 2003 May 11, 2008
30,000 US$ 17.30 January 9, 2004 January 9, 2009
200,000 US$ 18.16 May 11, 2004 May 11, 2008
30,000 US$ 18.26 January 9, 2005 January 9, 2009
100,000 CA$ 25.46 May 8, 2002 May 11, 2008
Total: 590,000 shares of Trizec Properties
100,000 shares of Trizec Canada
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(1) As per Section 4, all options will become immediately exercisable on
the Effective Date and remain exercisable through December 13, 2003.
