EXHIBIT 10.12
AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT is made as of
June 30, 1996, by and between First Washington Realty Trust, Inc. a Maryland
corporation (the "REIT"), and Xxxxxxx X. Xxxxx ("Employee").
Recitals
A. The REIT and Employee executed an Executive Employment Agreement dated
as of June 26, 1994 (the "Original Agreement").
B. The REIT and Employee mutual desire to amend and restate the Original
Agreement pursuant to the terms set forth herein. This Agreement shall supersede
the terms set forth in the Original Agreement, and the Original Agreement shall
have no further force or effect.
C. The REIT wishes to contract for the managerial and business skills
possessed by the Employee and Employee desires to be employed by the REIT upon
the terms and subject to the conditions herein provided.
D. Employee will be hired by the REIT as its President and Chief Executive
Officer. In this capacity, he will develop policy, supervise staff, direct
day-to-day operations and shall have such other duties as the Board of Directors
of the REIT (the "Board") prescribes.
Terms and Conditions
NOW, THEREFORE, in consideration of the foregoing premises and mutual
covenants and conditions hereinafter set forth, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereby agree as follows:
1. Employment and Duties.
a. Position and Duties. Employee shall serve as President and Chief
Executive Officer of the REIT. Employee shall have such duties and authority as
are customary for, and commensurate with such position, including developing
policy, supervising staff, directing day-to-day operations, and such other
duties as the Board prescribes. Employee shall have such other duties and
authority as may from time to time be delegated or assigned to him by the Board.
b. Preclusion of Outside Business Activities. During his employment,
Employee shall devote substantially all of his professional energies, interest,
abilities and productive work time to the performance of this Agreement.
Employee shall not, without the prior written consent of the REIT, perform other
professional services of any kind or engage in any other business activity, with
or without compensation; provided, however, that Employee shall be allowed (i)
to continue to engage in the development of First Washington Management, Inc., a
Maryland corporation ("FWM"), at a level consistent with past duties; (ii) to
engage in administering the business and activities of the First Washington
Realty Limited Partnership, a Maryland limited partnership (the "Operating
Partnership"); (iii) to serve as a Director on Boards of up to three (3)
non-competing companies; and (iv) to engage in passive investments that Employee
may make from time to time for his personal account; so long as the activities
described in clauses (i) - (iv) do not detract or adversely affect Employee's
duties and responsibilities under this
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Agreement. Employee shall not, without the prior written consent of the REIT,
engage in any activity adverse to the REIT's interests.
2. Term of Employment.
a. Term. This Agreement shall continue in full force and effect until
June 30, 1999, unless sooner terminated or extended as hereinafter provided (the
"employment term").
b. Extension of Term. The employment term set forth in a paragraph
2(a) above may be extended by written amendment to this Agreement signed by both
parties. The parties agree that they will use their best efforts to negotiate
the extension of this Agreement, if there is to be an extension, not later than
twelve months before the end of the employment term.
c. Termination by the REIT.
(i) Without Cause. The REIT may terminate this Agreement and
Employee's employment at any time for any reason or for no reason at all upon
two weeks prior written notice to Employee. Following notice of termination, the
REIT may elect to require Employee to continue to perform his duties under this
Agreement for an additional sixty (60) days. In connection with the termination
of Employee's employment pursuant to this Section 2(c)(i), Employee shall (A) be
paid his salary and any bonus payable to him in accordance with Sections 3(a)
and 3(b) hereof and shall be entitled to the benefits set forth in Sections 3(d)
- 3(h) hereof up to the effective date of such termination, (B) receive the
Termination Compensation specified in Section 5(a) hereof, (C) retain the right
to receive the Contingent Shares for the three year period after the date hereof
in accordance with the terms of Annex B, (D) have the Restrictions on the
Restricted Stock lapse in accordance with the provisions of the Restricted Stock
Agreement set forth as Annex "D" hereto, and (E) receive the Contingent Stock in
accordance with the provisions of the Contingent Stock Agreement set forth as
Annex "E" hereto.
(ii) With Cause. Prior to the expiration of the employment term,
Employee's employment may be terminated for Cause by the Board, immediately upon
delivery of notice thereof. For purposes of this Agreement, "Cause" shall mean
Employee's termination only upon: (A) material incompetence in the performance
of his duties or obligations hereunder, including, without limitation; those
duties and obligations specified in Section 1(a) hereof; (B) Employee's engaging
in any act which is materially injurious to the REIT; (C) personal dishonesty,
willful misconduct, or breach of fiduciary duty involving personal profit; (C)
intentional and material failure to perform his stated duties; (E) willful
violation of any law which materially adversely affects his ability to discharge
his duties or has an adverse effect on the REIT's interests; or (F) Employee's
breaching in any material respect the terms of this Agreement or any
confidentiality or proprietary information agreement between Employee and FWM,
the Operating Partnership or the REIT; provided, however that "Cause" shall not
exist unless and until the REIT provides Employee with (Y) at least 15 days
prior written notice of its intention to terminate his employment for Cause,
together with a certified copy of the resolution of the Board reasonably
approving the termination of Employee's employment for Cause by the affirmative
vote of not less than a majority of the Board and a written statement describing
the nature of the Cause, and (Z) a reasonable opportunity and a reasonable
period of time to cure any curable acts or omissions on which the finding of
Cause is based. If the Employee cures the acts or omissions on which the finding
of Cause is based, the REIT shall not have Cause to terminate Employee's
employment hereunder.
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d. Termination by Employee.
With Good Reason or After Change of Control. Employee may
terminate this Agreement (i) with good reason or (ii) with good reason within
twenty-four (24) months following any change of control of the REIT upon written
notice to the REIT. Employee shall continue to perform, at the election of the
REIT, his duties under this Agreement for an additional thirty (30) days
following notice of termination. In such event, Employee shall (A) be paid his
salary and any bonus otherwise payable to him in accordance with Sections 3(a)
and 3(b) hereof and be entitled to the benefits set forth in Sections 3(d)- 3(h)
hereof up to the effective date of such termination, (B) receive the Termination
Compensation specified in Section 5(a) hereof, and (C) retain the right to
receive the Contingent Shares in accordance with the terms of Annex B, (D) have
the Restrictions on the Restricted Stock lapse in accordance with the provisions
of the Restricted Stock Agreement set forth as Annex "D" hereto, and (E) receive
the Contingent Stock in accordance with the provisions of the Contingent Stock
Agreement set forth as Annex "E" hereto.
For purposes of this Section 2(d), "good reason" shall mean (A)
the breach by the REIT of any of its obligations hereunder and the failure of
the REIT to cure such breach within sixty (60) days after receipt by the REIT of
a written notice of the Employee specifying in the reasonable detail the nature
of the breach, or (B) any material diminution in the scope of Employee's
responsibilities and duties.
For purposes of this Section 2(d), a "change of control" shall be
deemed to have occurred if (1) any "person" (as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than
a trustee or other fiduciary holding securities under an employee benefit plan
of the REIT, a corporation owned directly or indirectly by the stockholders of
the REIT in substantially the same proportions as their ownership of stock of
the REIT, Employee, or Xxxxxxx X. Xxxxx, or any of their respective affiliates,
becomes the "beneficial owner" (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the REIT representing 50% or more of
the total voting power represented by the REIT's then outstanding securities
which vote generally in the election of directors (referred to herein as "Voting
Securities"); (2) during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board and any new directors whose
election by the Board or nomination for election by the REIT's stockholders was
approved by a vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority of the Board; or (3) the stockholders of the
REIT approve a merger or consolidation of the REIT with any other corporation,
other than a merger or consolidation which would result in the Voting Securities
of the REIT outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into Voting Securities of
the surviving entity) at least 50% of the total voting power represented by the
Voting Securities of the REIT or such surviving entity outstanding immediately
after such merger or consolidation, or (4) the stockholders of the REIT approve
a plan of complete liquidation of the REIT or an agreement for the sale or
disposition by the REIT of (in one transaction or a series of transactions) all
or substantially all of the REIT's assets.
e. Termination Due to Death or Disability. Employee's employment
hereunder shall terminate immediately upon his death. In the event that by
reason of injury, illness or other physical or mental impairment Employee shall
be: (A) completely unable to perform his services hereunder for more than six
consecutive months, or (B) unable to perform his services hereunder for fifty
percent or more of the normal working day throughout twelve consecutive months,
then the REIT may terminate Employee's employment hereunder. In the event of the
termination of Employee's employment pursuant to this Section 2(e), Employee or
Employee's beneficiaries, estate, heirs, representatives, or assigns, as
appropriate, shall be entitled to receive (U) Employee's salary and any other
bonus otherwise payable to him in accordance with Sections 3(a) and 3(b) hereof
until the effective date of such termination; (V) receive the Termination
Compensation specified in Section 5(a) hereof; (W) the proceeds, if any, due
under any REIT-paid life insurance policy held by Employee, as determined by and
in accordance with the terms of any such policy; (X) any vested benefits in
Employee's stock options and the right to receive Contingent Shares in
accordance with the terms of Annex B; (Y) have the Restrictions on the
Restricted Stock lapse in accordance with the provisions of the Restricted Stock
Agreement set forth as Annex "D" hereto, and (Z) receive the Contingent Stock in
accordance with the provisions of the Contingent Stock Agreement set forth as
Annex "E" hereto.
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f. Removal as Director. Notwithstanding any other provision of this
Agreement, if Employee shall be removed from office as a director of the REIT at
any time during the employment term, then Employee may notify the REIT in
writing of his election to terminate this Agreement with good reason upon
written notice to the REIT and such notice shall be effective immediately upon
receipt by the REIT. In such event, Employee shall (A) be paid his salary and
any bonus otherwise payable to him in accordance with Sections 3(a) and 3(b)
hereof and be entitled to the benefits set forth in Sections 3(d) - 3(h) hereof
up to the effective date of such termination, (B) receive the Termination
Compensation specified in Section 5(a) hereof, and (C) retain the right to
receive the Contingent Shares in accordance with the terms of Annex B (provided
that Employee shall not be entitled to the Termination Compensation or the
Contingent Shares pursuant to this Section 2(f) if he is removed as a director
for cause under the corporation law of the State of Maryland).
3. Compensation and Related Matters.
a. Salary. Employee's annual base salary during the employment term
shall be $250,000 per annum. Such salary shall be reviewed by the Board annually
during the first quarter of the REIT's fiscal year, and Employee shall receive
such salary increases, if any, as the Board, in its sole discretion, shall
determine. Such salary shall be payable in accordance with the REIT's normal
payment practices, but in no event shall such salary be payable less frequently
than monthly in equal installments.
b. Bonus. In addition to the salary set forth in paragraph 3(a) above,
Employee shall be eligible to receive such bonus, if any, as the Board shall
determine, in accordance with the criteria set forth in Annex A hereto.
c. Options. Substantially concurrent with the transactions pursuant to
which the REIT was formed (the "Formation Transactions"), the REIT granted
Employee options to purchase 146,475 shares of the REIT's Common Stock under the
REIT's 1994 Stock Option Plan on the terms and conditions set forth therein. If
Employee leaves his employment with the REIT for any reason set forth in Section
2(c)(i) or 2(d), all his unvested options shall automatically and fully vest. If
Employee leaves his employment with the REIT for any reason other than as set
forth in 2(c)(i) or 2(d) all unvested options shall be forfeited. Upon
Employee's termination of employment, Employee (in the case of his death,
Employee's personal representative or heirs) shall be entitled to exercise all
options vested as of the date of termination of employment at any time during
the applicable unexpired exercise period set forth in the Stock Option Plan.
d. Restricted Stock. Employee shall be entitled to receive 39,200
shares of Restricted Stock pursuant to the terms and additions set forth in the
form of Restricted Stock Agreement set forth as Annex "D" hereto; provided,
however, that the grant of such Restricted Stock shall be subject to the
approval of the REIT's stockholders.
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e. Contingent Stock. Employee shall be entitled to receive 30,000
shares of Contingent Stock pursuant to the terms and conditions set forth in the
form of Contingent Stock Agreement set forth as Annex "E" hereto; provided,
however, that the grant of such Contingent Stock shall be subject to the
approval of the REIT's stockholders.
f. Benefits. The Employee shall be entitled to:
(i) participate in or receive benefits under any employee benefit
plan or other arrangement including, but not limited to, any medical, dental,
retirement, disability, life insurance, sick leave and vacation plans or
arrangements made available by the REIT to any of its employees, subject to and
on a basis consistent with the terms, conditions and overall administration of
such plans or arrangement; and
(ii) participate in the REIT's executive deferred compensation
plan and 401(k) plan.
g. Contingent Shares. Employee shall be entitled to receive the
Contingent Shares (as defined in Annex B), upon the satisfaction of certain
performance thresholds as specified in Annex B.
h. Expenses. The REIT shall promptly pay directly or reimburse
Employee for all reasonable travel and other business expenses incurred by
Employee in the performance of his duties to the Company under this Agreement.
i. Vacation. Employee shall be entitled to vacation benefits in
accordance with the REIT's normal vacation policies, but in no event less than
four weeks of paid vacation each calendar year.
j. Professional Memberships. The REIT shall promptly pay directly or
reimburse Employee for all reasonable expenses incurred by Employee with respect
to professional memberships.
k. Automobile Allowance. The REIT shall provide Employee with an
automobile allowance for a company automobile of comparable quality as
automobiles customarily provided to executive officers in the industry. Expenses
relating to such automobile will be paid in accordance with the normal and
customary practice of the REIT.
l. Deductions and Withholdings. All amounts payable or which become
payable under any provision of this Agreement shall be subject to any deductions
authorized by Employee and any deductions and withholdings required by law.
4. Covenant Not to Compete or Solicit.
a. Non-Competition. Employee agrees that during the term of this
Agreement he will not directly or indirectly engage in (whether as an employee,
consultant, proprietor, partner, director or otherwise), or have any ownership
interest in, or participate in the financing, operation, management or control
of, any person, firm, corporation or business that engages in or intends to
engage in a Restricted Business. "Restricted Business" shall mean any business
that is engaged in or (to Employee's knowledge after due inquiry) preparing to
engage in the real estate business of the acquisition, development, management
and operation of principally retail shopping centers, provided, however, that
"Restricted Business" shall not include the ownership or the participation in
the operation and management of those properties listed on Annex C hereto.
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Employee further agrees that for the eighteen (18) month period
following the end of the employment term, he will not directly or indirectly
engage in (whether as an employee, consultant, proprietor, partner, director or
otherwise), or have any ownership interest in, or participate in the financing,
operation, management or control of, any person, firm, corporation or business
that engages in or intends to engage in a Post-Employment Restricted Business.
"Post-Employment Restricted Business" shall mean any business that is engaged in
or (to Employee's knowledge after due inquiry) preparing to engage in the real
estate business of the acquisition, development, management and operation of
principally, retail shopping centers within twenty-five (25) miles of a retail
property owned, directly or through one or more subsidiaries or otherwise, by
the REIT, the Operating Partnership or FWM at the end of the employment term,
provided, however, that "Post-Employment Restricted Business" shall not include
the ownership or the participation in the operation and management of those
properties listed on Annex C hereto.
Ownership of (i) no more than one percent (1%) of the outstanding
voting stock of a publicly traded entity, or (ii) any stock presently owned by
Employee, shall not constitute a violation of this Section 4(a).
This Section 4(a) shall not prohibit Employee from working for a
division or subsidiary of a company which division or subsidiary does not engage
in a Restricted Business or a Post-Employment Restricted Business, even though
other divisions or subsidiaries of such company do engage in a Restricted
Business or Post-Employment Restricted Business, provided that the REIT receives
adequate assurances as it may request that Employee has no involvement with the
divisions or subsidiaries engaged in the Restricted Business or Post-Employment
Restricted Business.
b. Non-Solicitation. Employee agrees that during the term of this
Agreement, he will not (i) solicit, encourage, or take any other action which is
intended to induce any other employee of the REIT to terminate his or her
employment with the REIT, or (ii) interfere in any manner with the contractual
or employment relationship between the REIT and any such employee of the REIT.
c. Severability. The parties intend that the covenants contained in
the preceding paragraphs shall be construed as a series of separate covenants,
one for each county of Maryland, Virginia, Pennsylvania, North Carolina, South
Carolina, and Delaware, and to the District of Columbia, each state of the
Union, and each nation. Except for geographic coverage, each such separate
covenant shall be deemed identical in terms to the covenant contained in the
preceding paragraphs. If, in any judicial proceeding, a court shall refuse to
enforce any of the separate covenants (or any part thereof) deemed included in
said paragraphs, then such unenforceable covenant (or such part) shall be deemed
eliminated from this Agreement for the purpose of those proceedings to the
extent necessary to permit the remaining separate covenants (or portions
thereof) to be enforced. In the event that the provisions of this Section 4
should ever be deemed to exceed the time or geographic limitations, or the scope
of this covenant, permitted by applicable law, then such provisions shall be
reformed to the maximum time or geographic limitations, as the case may be,
permitted by applicable laws.
5. Severance.
a. Termination. If Employee's employment is terminated (i) during the
employment term by the REIT other than for Cause pursuant to Section 2(c)(ii)
hereof, (ii) during the employment term by Employee with good reason or with
good reason after a change in control pursuant to Section 2(d) hereof, (iii)
during the employment term due to Employee's removal as a director pursuant to
Section 2(f) hereof, or (iv) during the employment term due to Employee's death
or disability pursuant to Section 2(e) hereof, or (v) if this Agreement expires
and is not renewed pursuant to Section 2(b); then Employee shall be paid a lump
sum amount equal to the greater of:
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(A) 200% of the sum of (x) Employee's annual base salary at the time
of such termination (as determined pursuant to Section 3(a)) plus (y) the
average annual bonus (if any) paid to Employee during the employment term;
or
(B) the sum of (x) the annual base salary (as determined pursuant to
Section 3(a)) Employee would otherwise be entitled to receive from the time
of such termination through the end of the employment term (as determined
pursuant to Section 2(a)) plus (y) the average annual bonus (if any) paid
to Employee during the employment term, annualized from the time of such
termination through the end of the employment term (the "Termination
Compensation").
No Termination Compensation shall be paid if the Employee's employment
is terminated during the employment term (i) by the REIT for Cause pursuant to
Section 2(c)(ii) hereof or (ii) by Employee without good reason. If Employee's
employment is terminated prior to the expiration of this Agreement for any
reason whatsoever, the REIT will continue to provide whatever medical,
disability, life or insurance benefits were in effect at the time of termination
until such time as this Agreement would have expired if Employee had not been
terminated (but in no event for a period less than twenty-four months). No
severance benefits shall be paid if the Employee's employment is terminated by
the REIT for Cause.
b. Survival. The expiration or termination of the employment term
shall not impair the rights or obligations of any party hereto which shall have
accrued hereunder prior to such expiration.
c. Mitigation of Damages. In the event of any termination of
Employee's employment, Employee shall not be required to seek other employment
to mitigate damages, and any income earned by Employee from other employment or
self-employment shall not be offset against any obligations of the REIT to the
Employee under this Agreement.
6. Employee's Representations. Employee represents and warrants to the REIT
as follows:
a. Employee is familiar with and approves the covenants not to compete
and not to solicit set forth in Section 4, including, without limitation, the
reasonableness of the length of time, scope and geographic coverage of these
covenants.
b. Notwithstanding any "what-if" scenarios of the future results of
operations and stock prices of the REIT under certain assumptions which the
parties may have discussed, Employee has not relied on any such scenarios or any
forecasts or projections provided by the REIT and understands that neither the
REIT nor FWM has made any representation or warranty whatsoever regarding any
forecasts or projections to Employee.
7. Miscellaneous.
a. Notices. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing to both parties and shall be
deemed given on the date of delivery, if delivered, or three days after mailing,
if mailed first-class mail, postage prepaid, to the following addresses:
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i) If to Employee:
0000 Xxxx-Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx
xx) If to the REIT:
0000 Xxxx-Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Attn: General Counsel
or to such other address as any party hereto may designate by notice given as
herein provided.
b. Entire Agreement. This Agreement contains the entire understanding
and sole and entire agreement between the parties with respect to the subject
matter hereof, and supersedes any and all prior agreements, negotiations and
discussions between the parties hereto with respect to the subject matter
covered hereby. Each party to this Agreement acknowledges that no
representations, inducements, promises or agreements, oral or otherwise, have
been made by any party, or anyone acting on behalf of any party, which are not
embodied herein, and that no other agreement, statement or promise not contained
in this Agreement shall be valid or binding. This Agreement may not be modified
or amended by oral agreement, but only by an agreement in writing signed by the
REIT and by Employee, and which states the intent of the parties to amend this
Agreement.
c. Assignment and Binding Effect. Neither this Agreement nor the
rights or obligations hereunder shall be assignable by Employee. The REIT may
assign this Agreement to any successor of the REIT, and upon such assignment any
such successor shall be deemed substituted for the REIT upon the terms and
subject to the conditions hereof, provided, that substantially all of the assets
of the REIT are also transferred to the same party.
d. Successor to the REIT. The REIT will require any successor or
assign (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all the business and/or assets of the REIT,
as the case may be, by agreement in form and substance reasonably satisfactory
to Employee, expressly, absolutely and unconditionally to assume and agree to
perform this Agreement in the same manner and to the same extent that the REIT
would be required to perform it if no such succession or assignment had taken
place. Any failure of the REIT to obtain such agreement prior to the
effectiveness of any such succession or assignment shall be a material breach of
this Agreement. This Agreement shall inure to the benefit of and be enforceable
by Employee's personal and legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If Employee should die
while any amounts are still payable to Employee hereunder, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to Employee's devisee, legatee or other designee or, if there be
no such designee, to Employee's estate.
e. Arbitration. The parties agree that any and all disputes (contract,
tort, or statutory, whether under federal, state or local law) between Employee
and the REIT (including other REIT employees, officers, directors and
representatives) arising out of Employee's employment with the REIT, the
termination of that employment, or this Agreement, shall be submitted to final
and binding arbitration. The arbitration shall take place in the County of
Xxxxxxxxxx, and may be compelled and enforced according to the Maryland
Arbitration Act. Unless the parties mutually agree otherwise, the arbitration
shall be conducted before the American Arbitration Association, according to its
Commercial Arbitration Rules. Judgment on the award the arbitrator renders may
be entered in any court having jurisdiction over the parties. Arbitration shall
be initiated in accordance with the Commercial Arbitration Rules of the American
Arbitration Association.
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f. Amendments; Waivers. This Agreement may not be modified, amended,
or terminated except by an instrument in writing, approved by the Board and
signed by Employee and the REIT. By an instrument in writing similarly executed,
the Employee or the REIT may waive compliance by the other party or parties with
any provision of this Agreement that such other party was or is obligated to
comply with or perform; provided, however, that such waiver shall not operate as
a waiver of, or estoppel with respect to, any other or subsequent failure. No
failure to exercise and no delay in exercising any right, remedy or power
hereunder shall preclude any other or further exercise of any other right,
remedy or power provided herein or by law or equity.
g. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Maryland as applied to
agreements made and performed in Maryland by residents of Maryland.
h. Effectiveness. This Agreement shall become effective on June 30,
1996. Notwithstanding any provision herein to the contrary, if (i) this
Agreement is executed by the parties prior to June 30, 1996 and (ii) prior to
June 30, 1996 the Company's stockholders have failed to approve the grant of
Restricted Stock described in Section 3(d) herein or the grant of Contingent
Stock described in Section 3(e) herein, then at any time prior to June 30, 1996
Employee shall have the option to rescind this Agreement, and the terms of the
Original Agreement shall continue in full force and effect.
i. Attorneys' Fees. In the event of any arbitration or legal action or
proceeding to enforce or interpret the provisions hereof, the prevailing party
shall be entitled to reasonable attorneys' fees, whether or not the proceeding
results in a final judgment.
j. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same agreement.
k. Effect of Headings. The section headings herein are for convenience
only and shall not affect the construction or interpretation of this Agreement.
l. Severability. The provisions of this Agreement are severable. If
any provision of this Agreement shall be held to be invalid or otherwise
unenforceable in whole or in part, the remainder of the provisions or
enforceable parts hereof shall not be affected thereby and shall be enforced to
the fullest extent permitted by law.
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Executive Employment Agreement as of the date first written above.
FIRST WASHINGTON REALTY TRUST, INC.
a Maryland Corporation
By:_______________________________
Xxxxxx X. Xxxxxxx
Chairman
Attest:
-----------------------------------
Xxxxxxx X. Xxxxxxxxxx, Secretary
EMPLOYEE
----------------------------------
Xxxxxxx X. Xxxxx
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ANNEX A
Bonus Payments
Employee shall be eligible for a bonus payment pursuant to Section
3(b) (the "Bonus") in accordance with the following:
1. Amount. The amount of the Bonus shall range from 0 to 100% of
Employee's annual salary, determined pursuant to Section 3(a), for the most
recent fiscal year. If, during a given year, the REIT achieves targeted
performance and the employee performs at an acceptable level, then the targeted
Bonus for any such year shall be fifty percent (50%). Notwithstanding the
foregoing, the maximum Bonus payable for the time periods set forth in paragraph
3(a)(i) and 3(a)(ii), together, shall not exceed $77,500.
2. Criteria.
a. The Board's determination regarding Bonus grants for Bonuses
based on the Company's performance from July 1, 1995 - December 31, 1996 shall
be based upon the performance criteria set forth below:
(i) Measure Target Weight
------- ------ ------
FFO growth 6% 15%
Total Return 15% 15%
Portfolio Growth 10% 20%
Board's Discretion n/a 50%
(ii) FFO Growth shall be calculated as the annual growth
rate in funds from operations per share (calculated on
a fully diluted basis).
(iii) Total Return shall be calculated as the sum of (x) the
annual dividend and (y) the increase in the
appreciation in the REIT's stock, measured as the
annual change in the market price of the REIT's common
stock.
(iv) Portfolio Growth shall be calculated as the increase
in the aggregate value of real property in the REIT's
portfolio, based upon the original cost of such
properties.
The Board shall have the discretion to amend the performance criteria
in future years, provided, however, that the Board shall advise Employee of the
criteria for a given year at the beginning of such year.
3. Timing.
a. As described in paragraph 2 above, the Bonus shall be based
upon the REIT's performance during a given period. The Board shall determine
Employee's Bonus, if any, within the following time periods:
(i) for the period from June 30, 1995 to June 30, 1996 the
Board shall make its determination during the third
calendar quarter of 1996, and such Bonus, if any,
shall be paid to Employee no later than September 30,
1996;
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(ii) for the period from July 1, 1996 to December 31, 1996,
the Board shall make its determination during the
first calendar quarter of 1997, and such Bonus, if
any, shall be paid to Employee no later than March 31,
1997. Because this Bonus determination will be
calculated upon performance during a partial year
period, the target criteria for determining the bonus
(as specified in paragraph 2(a)(i) above) shall be pro
rated accordingly; and
(iii) for subsequent fiscal years during the term of
employment (i) the Board shall make its determination
during the first quarter of the following fiscal year,
and such Bonus, if any, shall be paid to Employee, no
later than March 31st of the following fiscal year.
b. Except as provided in 3(iii) below, Employee must be actively
employed as the end of the REIT's fiscal year to be eligible to receive a Bonus
for such year.
c. Notwithstanding Section 3(ii), Employee shall be eligible for
a prorated Bonus if Employee is not actively employed by the REIT due to one of
the following reasons:
(i) if Employee terminates employment for good reason
pursuant to Section 2(c)(ii) of the Agreement or as a
result of a Change of Control pursuant to Section 2(d)
of the Agreement.
(ii) if Employee is terminated due to death or total
disability pursuant to Section 2(e) of the Agreement.
(iii) if this Agreement expires and is not renewed pursuant
to Section 2(b).
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ANNEX "B"
The Company has reserved 100,000 shares of Common Stock ("Contingent
Shares") for issuance to employee (or his designee) during the three year period
following the date hereof upon the achievement of the following performance
based objectives as follows:
(i) one-third of the Contingent Shares shall be issued as of June 27,
1995 (the end of the first year following consummation of the REIT's
offering of certain shares of Series A Convertible Preferred Stock and
Common Stock (the "Offering")), if the annual growth rate in funds
from operations per share (calculated on a fully diluted basis)
between July 1, 1994 and June 30, 1995 equals or exceeds 7.0%;
(ii) one-third of the Contingent Shares shall be issued as of June 27,
1996 (the end of the second year following the Offering) if the annual
growth rate in funds from operations per share (calculated on a fully
diluted basis) between July 1, 1995 and June 30, 1996 equals or
exceeds 7.0%;
(iii) one-third of the Contingent Shares shall be issued as of June
27, 1997 (at the end of the third year following consummation of
Offering), if the annual growth rate in funds from operations per
share (calculated on a fully diluted basis) between July 1, 1996 and
June 30, 1997 equals or exceeds 7.0%; and
(iv) if as of June 27, 1997 (at the end of the third year following
consummation of the Offering), less than 100% of the Contingent Shares
have been issued, Employee shall be issued a number of additional
Contingent Shares such that the aggregate amount of Contingent Shares
issued to Employee (including all previously issued Contingent Shares)
is as follows:
(A) Employee shall have received one-third of the Contingent
shares if funds from operations per share (calculated on a fully
diluted basis) increased by 7.0% or more (but less than 14.0%)
between July 1, 1994 and June 30, 1997;
(B) Employee shall have received two-thirds of the Contingent
Shares if funds from operations per share (calculated on a fully
diluted basis) increased by 14.0% or more (but less than 21.0%)
between July 1, 1994 and June 30, 1997; and
(C) Employee shall have received 100% of the Contingent Shares if
funds from operations per share (calculated on a fully diluted
basis) increased by 21.0% or more between July 1, 1994 and June
30, 1997.
Employee shall have the right to cause the Company to grant any portion of the
Contingent Shares to Employee's designee who is an employee of the Company.
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ANNEX "C"
LIST OF PROPERTIES AND ENTITIES EMPLOYEE MAY CONTINUE TO OWN AND
PARTICIPATE IN THE OPERATION AND MANAGEMENT OF:
1. 000 00xx Xxxxxx
2. Deale, Maryland land parcel
3. Properties currently owned by Mid-Atlantic Centers Limited
Partnership
a. Woodlawn Village
b. Lynnwood Place
c. Highlandtown Village
x. Xxxxxxx Heights
e. Holiday
f. Orchard Square
g. Cloister
h. Edgewood
i. Tarrytown Mall
j. Berkeley Square
k. Quality Center
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