Exhibit 99.1
SECOND AMENDMENT TO EMPLOYMENT AGREEMENT
This Second Amendment to Employment Agreement (this "Second Amendment") is
effective as of December 18th, 2004 by and among Kramont Operating Partnership,
L.P., a Delaware limited partnership (the "Company"), Kramont Realty Trust, a
Maryland real estate investment trust ("Kramont") and Xxxxx X. Xxxxxx, Xx.
("Executive").
BACKGROUND
WHEREAS, Kramont and Executive have entered into an Employment Agreement
dated effective as of June 16, 2000, as amended by a First Amendment to
Employment Agreement dated effective as of July 1, 2004 (herein referred to as
"Employment Agreement") wherein the parties agreed to the terms and conditions
of Executive's employment with the Company; and
WHEREAS, the parties hereto desire to further amend certain of the terms
and conditions of the Employment Agreement.
NOW THEREFORE, in consideration of the mutual promises and covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. The definition of "Change of Control" set forth in Paragraph 7(e) of
the Employment Agreement is amended and Paragraph 7(e) of the Employment
Agreement is restated to read in its entirety as follows:
"(e) Executive shall have the right to terminate his employment under this
Agreement for Good Reason. "Good Reason" means (i) the assignment to Executive
of any duties materially inconsistent with his status as President and Chief
Executive Officer of the Company; (ii) a material breach by the Company of any
material provision of this Agreement which breach is not remedied within thirty
(30) days after receipt by the Company of notice thereof from Executive or,
notwithstanding such cure, repeated or systematic and material breaches by the
Company of any material provision of this Agreement; or (iii) any Change in
Control of the Company. "Change of Control" means the closing of a transaction
or a series of related transactions which involves (i) a transfer of all or
substantially all of Kramont's or the Company's assets and business (whether
structured as an acquisition, sale of assets, merger, consolidation or
otherwise, and whether or not Kramont or the Company is the surviving entity of
the transaction); (ii) an exchange of 35% or more of equity securities of
Kramont for assets or stock of another entity or Person, or (iii) the election
to the Company's Board of Trustees after a transaction described in (i) or (ii)
of this paragraph of new trustees not formerly associated with Kramont
constituting a majority of the number of Trustees of the Company then in
office."
2. The second sentence of Paragraph 7(f) is hereby replaced in its
entirety with the following language:
"Upon termination of Executive's employment under Paragraph 7(e) of this
Agreement, in addition to the benefits provided under Paragraph 4(d):
(i) Executive shall become immediately entitled to receive a lump sum payment by
Kramont(or its successor in interest) in an amount equal to three (3) times the
sum of the annual Base Salary and bonus, plus all accrued and unpaid bonus and
other awards and unreimbursed expenses; (ii) all stock options and other awards
subject to vesting period not then expired shall, effective upon such Closing,
become fully vested; and (iii) Kramont (or its successor in interest) shall
continue the medical, dental and life insurance coverages (or coverage similar
thereto) being provided Executive immediately prior to the date of termination
of employment which shall be continued in effect, at the Company's expense
(provided that coverage can be obtained at commercially reasonable rates), for a
period ending on the sooner of three years from the date of termination of
employment or the date in which Executive obtains new employment which provides
him with such coverage; provided, however, that in no event shall any payment be
made under this Section 7(f) to the extent such payment would constitute an
"excess parachute payment" within the meaning of Section 280G of the Internal
Revenue Code, of 1986, as amended (the "Code") determined without regard to
Section 280G(b)(4) of the Code. For purposes of computing the sum of the Base
Salary and bonus due hereunder, bonus shall mean the regular average annual
bonus as determined previously by the Board's Compensation Committee paid to the
Executive during the three years prior to the event giving rise to the payment.
Executive shall have no obligation to mitigate the Company's severance
obligations under this paragraph and no amounts earned by Executive following
such termination shall be deemed to reduce the payments required under this
Paragraph 7(f). Such payments shall be in lieu of any and all entitlements that
Executive may have by contract or otherwise. Any payments hereunder shall be
conditioned on the execution by the Executive of a General Release in a form
satisfactory to Kramont (other than with respect to the obligation of Kramont
and the Company or their successors in interest hereunder)."
3. Paragraph 9(a) of the Employment Agreement in amended and restated to
read in its entirety as follows:
"(a) Not to hire, directly or indirectly, or entice or participate in
any efforts to entice to leave the Company's employ, any person who was an
employee of the Company, provided however that this restriction shall not apply
to Xxxxx X. Xxxxxx, Xx."
4. Paragraph 9(b) of the Employment Agreement is hereby deleted in its
entirety.
5. This Second Amendment and the Employment Agreement represent the entire
understanding between the parties and supersedes all other oral or written
agreements between the parties. The Employment Agreement, as amended by this
Second Amendment, is hereby ratified and confirmed and remains in full force and
effect.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Second Amendment as of the date and year first above written.
KRAMONT OPERATING PARTNERSHIP, L.P.
By: /s/ Xxxx X. Xxxxx
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Dated: 12/18/04 Xxxx X. Xxxxx
Xx. Vice President and
Chief Financial Officer
KRAMONT REALTY TRUST
By: /s/ Xxxx X. Xxxxx
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Dated: 12/18/04 Xxxx X. Xxxxx
Xx. Vice President and
Chief Financial Officer
EXECUTIVE
By: /s/ Xxxxx X. Xxxxxx, Xx.
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Dated: December 18, 2004 Xxxxx X. Xxxxxx, Xx.
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