FIRST AMENDMENT TO THE THIRD AMENDED AND RESTATED EMPLOYMENT AGREEMENT
EXHIBIT 10.6
This First Amendment to the Third Amended and Restated Employment Agreement (this
“Amendment”), dated October 3, 2005, is entered into by and between Xxxxxxxx Properties Trust, a
Maryland real estate investment trust (the “Company”), and Xxxxxxx X. Xxxxxxxx (the “Executive”).
RECITALS
A. The Company and the Executive entered into that certain Third Amended and Restated
Employment Agreement dated as of January 1, 2004 (the “Employment Agreement”), which provides for,
among other things, the provision of certain continuing benefits in the event of the termination of
the Executive without cause or a change in control, including but not limited to health insurance
benefits, office space, secretary usage, airplane usage and clubs and physicals.
B. In order to more clearly specify the rights of the Executive under the Employment
Agreement, the Company and the Executive hereby amend the Employment Agreement. Capitalized terms
not otherwise defined herein shall have the meaning ascribed to such terms in the Employment
Agreement.
AGREEMENT
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants, promises and obligations of the
parties provided for in this Amendment, and the benefits to be received by the Executive, and for
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto adopt the following as an amendment to the terms of the Employment
Agreement:
1. Benefits. The medical, vision, dental, health (including but not limited to annual
physicals) and prescription drugs benefits to be provided to the Executive and his Dependents for
three years after the date of the Executive’s death, disability or Termination Without Cause,
termination of employment by the Executive or the resignation of the Executive after a Change of
Control (such three-year period, the “Continuation Period”) at the Company’s expense in accordance
with Paragraphs 8 and 9 of Section B of the Employment Agreement are hereby agreed to refer to
medical, vision, dental, health and prescription drugs benefits, long-term disability coverage and
life insurance and other death benefit coverage that are no worse than the level of such benefits
and policies provided to the Executive by the Company as of the date of this Amendment and the
current terms thereof, including but not limited to similar deductibles, co-payments and solvency
and rating of the insurance company providing coverage, all as set forth on Schedule A
attached hereto. The Executive shall be able to participate in the Company’s benefit plans or the
benefit plans of any successor or assign, including but not limited to any deferred compensation
plans, after any Change in Control if he is retained as trustee, consultant or otherwise. The
Executive will also be entitled to maintain any deferrals made in the
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Company’s deferred compensation plan or any successor plans (with any balance in the current
plans being rolled over into such successor plan) without payment of any taxes or penalties.
2. Post Continuation Period Benefits. The Executive shall have the right, in his sole
discretion, to extend the medical, vision, dental, health and prescription drugs insurance benefits
provided under the Employment Agreement after the expiration of the Continuation Period for an
indefinite period of time; provided, however, the Company will not bear the premiums related to
such insurance after the expiration of the Continuation Period, but the Company shall use its best
efforts to obtain the group rate or otherwise to negotiate a low rate for participation in such
insurance for the Executive.
3. Offices. Paragraph 8 and 9 of Section B of the Employment Agreement provide that
the Executive shall be entitled to retain his current or a similar office during the Continuation
Period. The Executive’s current office, conference room and staff offices have the dimensions
specified in Schedule B attached hereto. For the purposes of clarification of what
constitutes the above “similar office,” the office to be provided to the Executive for the
Continuation Period at the Company’s expense is hereby agreed to refer to an office of the
Executive’s choosing located in a grade A office building in Dallas, Texas or the surrounding area
that is exterior office space and is not less than the square footage specified in Schedule
B. Such offices shall contain at least the same level of amenities as the Executive’s current
office, have staff offices that are contiguous with the Executive’s offices and accommodate all of
the office equipment that the Executive determines to be necessary for such offices. The offices
provided during the Continuation Period shall not be located in the office building in which they
are currently located. The Executive shall have such rights as are traditionally afforded to other
tenants in the building in which such office shall be provided, including tenant improvements of at
least $40.00 per square foot. The Executive shall be entitled to at least three parking places
free of charge adjacent to his office.
4. Staff. The secretary to be provided in accordance with Paragraphs 8 and 9 of
Section B of the Employment Agreement shall be Executive’s current secretary or any such
replacement secretary as the Executive may name in his sole discretion from time to time during the
Continuation Period, and the accountant referred to in Paragraphs 4(c), 8 and 9 of Section B of the
Employment Agreement is the Executive’s current accountant or any such replacement accountant as
the Executive may name in his sole discretion from time to time during the Continuation Period.
During the Continuation Period, both the secretary and the accountant shall, at sole option of the
Executive, be employed by the Company and shall be compensated and provided benefits by the Company
at least at the rates and terms that each of them currently receives, including participation in
the 401(k) plan and cafeteria plan, as of the date of this Amendment as set forth on Schedule
C with raises and annual bonuses consistent with past practices. Any replacements of the
secretary or accountant during the Continuation Period may, in Executive’s sole discretion, be
compensated by the Company up to the same rate as their predecessors during the remainder of the
Continuation Period and provided bonuses and raises up to the amounts provided to past secretaries
and accountants of the Executive.
5. Tax and Estate Planning. The tax and estate planning services to be provided
during the Continuation Period in accordance with Paragraphs 4(c), 8 and 9 of Section B of the
Employment Agreement shall be provided by a third party not affiliated with the Company
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selected by the Executive in his sole discretion. It is understood and acknowledged by both
parties that the initial costs for providing such tax and estate planning services may be
significant and all such costs during the Continuation Period shall be paid by the Company.
6. Dues. In accordance with Paragraphs 4(d), 8 and 9 of Section B of the Employment
Agreement, the Company will continue to reimburse the Executive during the Continuation Period for
all of the country club fees and dues set forth on Schedule D, with such increases as are
required from such clubs to maintain the level of rights and privileges as the Executive enjoys as
of the date of this Amendment.
7. Aircraft. The Executive shall have the right to use up to 100 hours of flight time
per year during the Continuation Period on a Challenger 300 (the “Company Aircraft”) through
Bombardier Aerospace Corporation dba FlexJet (“FlexJet”) or any successor or replacement fractional
ownership service or otherwise (collectively, the “Fractional Service”), at the Company’s expense
pursuant to the Management Agreement, dated as of March 15, 2005 between FlexJet and Xxxxxxxx
Properties Continental LLC or any successor agreement with materially similar terms. The Executive
may use the Company Aircraft for any purpose whatsoever during the Continuation Period, including
any personal, business or other uses, including but not limited to vacations and business meetings
unrelated to the Company; provided, however, that the Executive shall reimburse the Company for his
use of the Company Aircraft at the per flight hour rate equal to $2,435.00, as adjusted each
January 1 of the greater of (i) 3.75% or (ii) the “Consumer Price Index for all Urban Consumers—U.S
City average,” as published by the Bureau of Labor Statistics. The Executive shall have the right
to purchase the Company’s right to use the Company Aircraft upon the expiration of the Continuation
Period upon the payment of $100,000. The Company shall enter into an option agreement
memorializing the Executive’s purchase option in the form of Exhibit A.
8. Employment Agreement. This Amendment is intended to clarify and specify certain
rights and privileges of Executive set forth in the Employment Agreement. The Employment Agreement
shall continue in full effect after giving effect to this Amendment.
9. Entire Agreement; Amendment; Assignment. This Amendment, along with the Employment
Agreement, constitute the entire understanding between the parties hereto with respect to the
subject matter hereof. This Amendment shall not be modified in any manner other than pursuant to a
writing signed by or on behalf of both of the parties hereto. This Amendment shall be binding upon
and inure to the benefit of the heirs, successors and assigns of the parties hereto. The Executive
may not assign his rights except his rights to benefits hereunder may be transferred by will or
operation of law.
10. Applicable Law. This Amendment will be governed and construed in accordance with
the laws of the State of Texas.
11. Titles and Headings. Titles and headings to sections and paragraphs in this
Amendment are inserted for reference only and are not intended to be a part of or to affect the
meaning or interpretation of this Amendment.
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12. No Third-Party Beneficiaries. This Amendment is solely for the benefit of the
parties to this Amendment and, except to the extent the Company is affected hereby, should not be
deemed to confer upon third parties any remedy, claim, liability, reimbursement, claims or actions
or other right in excess of those existing without reference to this Amendment.
13. Counterparts. This Amendment may be executed in one or more counterparts, each of
which shall be deemed to be an original, but all of which together constitute one and the same
instrument.
14. Severability. Any provision of this Amendment that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions hereof. Any such
prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction. Without prejudice to any rights or remedies otherwise
available to any party to this Amendment, each party hereto acknowledges that the obligations of
the parties hereto shall be specifically enforceable.
15. Further Assurances. The parties hereto will execute and deliver or cause to be
executed and delivered such further instruments and documents and will take such other actions as
any other party to this Amendment may reasonably request in order to effectuate the purpose of this
Amendment and the Employment Agreement and to carry out the terms thereof.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the day and year first written above.
| THE EXECUTIVE | ||||
| /s/ Xxxxxxx X. Xxxxxxxx | ||||
| Xxxxxxx X. Xxxxxxxx | ||||
| THE COMPANY XXXXXXXX PROPERTIES TRUST |
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| By: | /s/ Xxxxxx X. August | |||
| Name: | Xxxxxx X. August | |||
| Title: | President & Chief Executive Officer | |||
First Amendment to the Third Amended and Restated Employment Agreement of Xxxxxxx X. Xxxxxxxx Dated October 3, 2005
