EXHIBIT 10.10
July 8, 1997
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into this
__________ day of ______________, 1997 by and between Prime Group Realty L.P., a
Delaware limited partnership [the operating partnership for Prime Group Realty
Corp., the REIT] ("Employer"), and Xxxxxx X. Xxxxxxxx, an individual domiciled
in the State of Illinois ("Executive").
WITNESSETH
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A. Employer is engaged primarily in the ownership, management, leasing,
marketing, acquisition, development and construction of office and industrial
real estate facilities throughout the United States.
B. Employer believes that it would benefit from the application of
Executive's particular and unique skill, experience, and background to the
development of industrial properties and the management thereof.
C. Executive wishes to commit himself to serve Employer in the position
set forth herein on the terms herein provided.
D. The parties wish by this Agreement to set forth the terms and
conditions of the employment relationship between Employer and Executive.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
herein set forth, and for other good and valuable consideration, Employer and
Executive hereby agree as follows:
1. Employment and Duties. During the Employment Term (as defined in
Section 2 hereof), Employer agrees to employ Executive, and Executive agrees to
be employed by Employer, as the President of Employer's Industrial Division on
the terms and conditions provided in this Agreement. Executive shall conduct,
operate, manage and promote the business and business concept of Employer, and
exercise such other powers and authority as are provided by the Partnership
Agreement of Employer ("Partnership Agreement"). The Chief Executive Officer or
the President of Employer may from time to time further define and clarify
Executive's duties and services hereunder or under the Partnership Agreement as
President of Employer's Industrial Division, which principal duties will include
the development, management, leasing, marketing and acquisition of industrial
properties Executive agrees to devote Executive's best efforts and substantially
all of Executive's business time, attention, energy and skill to perform
Executive's duties as President of Employer's Industrial Division. Employer
agrees to maintain the suburban office currently located at 0000 XxxXxxxxx
Xxxxxxxxx, Xxxxxxxxxx, Xxxxxxxx or such other suburban
location as may be mutually agreeable to Employer and Executive. Employer
represents to Executive that it currently intends to engage in the acquisition
and development of industrial properties.
2. Term. The initial term of this Agreement (the "Initial Term") shall
commence on the date Employer's Registration Statement on Form S-11, as amended
(No. _________; the "Registration Statement") is declared effective (the
"Effective Date") and expire on _______, 2000 [three year term] (the "Scheduled
Termination Date"), provided, however, this Agreement shall automatically extend
for one year terms following the Initial Term (each a "Renewal Term", together
with the Initial Term, the "Employment Term"), unless prior to six (6) months,
in the case of a non-renewal by Employer, or prior to thirty (30) days, in the
case of a non-renewal by Executive, before the end of the Initial Term or any
Renewal Term, as applicable, either party shall give the other written notice of
its intention to terminate this Agreement.
3. Compensation and Related Matters. (a) Base Salary. As compensation
for performing the services required by this Agreement during the Employment
Term, Employer shall pay to Executive an annual salary of no less than Two
Hundred Thousand Dollars ($200,000) ("Base Compensation"), payable in accordance
with the general policies and procedures for payment of salaries to its
executive personnel maintained, from time to time, by Employer (but no less
frequently than monthly), subject to withholding for applicable federal, state,
and local taxes. Increases in Base Compensation, if any, shall be determined by
the Compensation Committee (the "Committee") of the Board of Directors of Prime
Group Realty Corp. ("PGRC"), the general partner of Employer (the "Board"),
based on periodic reviews of Executive's performance conducted on at least an
annual basis.
(b) Bonus. In addition to Base Compensation, the Board and the
Committee in its sole and absolute discretion may, but in no event shall be
obligated to, authorize the payment of a cash bonus (a "Performance Bonus
Distribution") to Executive based upon achievement of such partnership and
individual performance goals and objectives as may be established or determined
by the Board or the Committee from time to time which shall be determined in
part by (i) the profitability of industrial properties acquired or developed by
Employer for which Executive had primary responsibility and (ii) the
profitability or success of PGRC.
(c) Benefits. During the Employment Term and subject to the
limitations and alternative rights set forth in this Section 3(c), Executive and
Executive's eligible dependents shall have the right to participate in the
medical and dental benefit plan to be established by Employer (which may include
contributions by Executive) and in any other retirement, pension, insurance,
health or other benefit plan or program that has been or is hereafter adopted by
Employer (or in which Employer participates), as such plans and programs may be
amended or modified from time to time by Employer, according to the terms of
such plan or program with all the benefits, rights and privileges as are enjoyed
by any other executive officers of Employer. Employer expects to have in place a
life insurance program in which Executive will be entitled to participate. If
the participation of Executive would adversely affect the qualification of a
plan intended to be qualified under Section 401(a) of the Internal Revenue Code
as the same may be amended from time to time
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(the "Code"), Employer shall have the right to exclude Executive from that plan
in return for Executive's participation in (i) a nonqualified deferred
compensation plan or (ii) an arrangement providing substantially comparable
benefits under a plan that is either a qualified or nonqualified under the Code
at Employer's option. Employer agrees to provide Executive, at Employer's cost
and expense, a membership in the Executive Sports and Fitness Center located at
00 X. Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx.
(d) Expenses. Executive shall be reimbursed, subject to Employer's
receipt of invoices or similar records as Employer may reasonably request in
accordance with its policies and procedures, as such policies and procedures may
be amended or modified from time to time by Employer, for all reasonable and
necessary expenses incurred by Executive in the performance of Executive's
duties hereunder, including expenses for business entertainment and meals
(whether in or out of town) and gas for business travel, but excluding
automobile insurance.
(e) Vacations. During the Employment Term, Executive shall be
entitled to vacation in accordance with Employer's practices, as such practices
may be amended or modified from time to time by Employer, provided that
Executive shall be entitled to at least three (3) weeks paid vacation in each
full calendar year. Executive may accrue unused vacation time if not used in any
calendar year or years, however, the maximum cumulative amount of vacation time
that Executive may accrue and carry over to the next year is two (2) weeks.
Executive shall be entitled to a payment for any vacation time which has accrued
but has not been used as of the date of the termination of Executive's
employment with Employer, unless Executive's employment is terminated pursuant
to Section 5(a)(ii) hereof.
(f) Automobile. During the Employment Term, Employer shall pay
Executive an automobile allowance of $1350 per month.
4. Stock Options. The general partner of Employer, PGRC has established
a stock incentive plan (the "Stock Incentive Plan") that will become effective
prior to the completion of the initial public offering of shares of common stock
of PGRC (the "Common Stock") contemplated by the Registration Statement. The
Stock Incentive Plan initially provides, among other things, for the issuance
from time to time to certain officers, directors and other employees of PGRC and
Employer, including Executive, of stock options. On the Effective Date, pursuant
to the Stock Incentive Plan, PGRC shall grant to Executive 80,000 stock options
("Options") that will have such terms and conditions as are set forth in the
Stock Incentive Plan and the Stock Option Agreement to be entered into between
PGRC and Executive. Such Options granted to Executive shall vest immediately
upon the death or disability of Executive or upon termination of this Agreement
and Executive's employment for any reason other than a termination for cause by
Employer. In the case of a termination for cause, all unvested Options shall be
forfeited by Executive, but Executive shall have the right to exercise within
the time period provided for in the Stock Incentive Plan all Options vested
prior to such termination for cause.
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5. Termination and Termination Benefits. (a) Termination by Employer.
(i) Without Cause. Employer may terminate this Agreement and Executive's
employment at any time for any reason or for no reason at all upon thirty (30)
days' prior written notice to Executive following notice of termination. In
connection with the termination of Executive's employment pursuant to this
Section 5(a)(i), Executive shall (A) be paid Executive's Base Compensation in
accordance with Section 3(a) hereof up to the effective date of such
termination, (B) be paid a pro rata portion of any bonus otherwise payable to
Executive for or with respect to the calendar year in which such termination
occurs in accordance with Section 3(b) hereof to the effective date of such
termination and, to the extent not previously paid, Executive shall be entitled
to all bonuses payable to Executive in accordance with Section 3(b) hereof for
or with respect to any calendar years prior to the calendar year in which such
termination occurs, (C) be entitled to the benefits set forth in Sections
3(c),3(d),3(e) and 3(f) hereof up to the effective date of such termination and
(D) receive the Termination Compensation specified in Section 5(d) hereof. For
purposes of calculating Executive's pro rata portion of any bonus pursuant to
clause (B) in the previous sentence, if the termination takes place prior to
receipt by Executive of any Performance Bonus Distribution, the Performance
Bonus Distribution, a pro rata (based on the number of days in the year) portion
of which Executive shall be entitled to receive, shall be deemed to be 50% of
Executive's then current annual Base Compensation.
(ii) With Cause. Employer may terminate this Agreement with
cause immediately upon written notice to Executive. Employer may elect to
require Executive to continue to perform Executive's duties under this Agreement
for an additional thirty (30) days following notice of termination. In
connection with the termination of Executive's employment pursuant to this
Section 5(a)(ii), Executive shall (A) be paid Executive's Base Compensation in
accordance with Section 3(a) hereof up to the effective date of such
termination, and, to the extent not previously paid, Executive shall be entitled
to any bonuses payable to Executive in accordance with Section 3(b) hereof for
or with respect to any calendar years prior to the calendar year in which such
termination occurs and (B) be entitled to the benefits set forth in Sections
3(c), 3(d), 3(e) and 3(f) hereof up to the effective date of such termination.
For purposes of this Section 5(a)(ii), "cause" shall mean (A) a finding by the
Board that Executive has materially harmed Employer, its business, assets or
employees through an act of dishonesty, material conflict of interest, gross
misconduct or willful malfeasance, (B) Executive's conviction of (or pleading
nolo contendere to) a felony, (C) Executive's failure to perform (which shall
not include inability to perform due to disability) in any material respects
Executive's material duties under this Agreement after written notice specifying
the failure and a reasonable opportunity to cure (it being understood that if
Executive's failure to perform is not of a type requiring a single action to
fully cure, then Executive may commence the cure promptly after such written
notice and thereafter diligently prosecute such cure to completion), (D) the
breach by Executive of any of Executive's material obligations hereunder (other
than those covered by clause (C) above) and the failure of Executive to cure
such breach within thirty (30) days after receipt by Executive of a written
notice of Employer specifying in reasonable detail the nature of the breach, or
(E) Executive's sanction (including restrictions, prohibitions and limitations
agreed to under a consent decree or agreed order) under, or conviction for
violation of, any federal or state securities law, rule or regulation (provided
that in the case of a sanction, such sanction materially
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impedes or impairs the ability of Executive to perform Executive's duties and
exercise Executive's responsibilities hereunder in a satisfactory manner).
(iii) Disability. If due to illness, physical or mental
disability, or other incapacity, Executive shall fail during any four (4)
consecutive months to perform the duties required by this Agreement, Employer
may, upon thirty (30) days' written notice to Executive, either terminate this
Agreement or suspend Executive's right to any Base Compensation or Performance
Bonus Distributions without terminating this Agreement. In any such event,
Executive shall (A) be paid Executive's Base Compensation in accordance with
Section 3(a) hereof up to the effective date of such termination, (B) be paid a
pro rata portion of any bonus otherwise payable to Executive for or with respect
to the calendar year in which such disability occurs in accordance with Section
3(b) hereof up to the first day of such four (4) month period and, to the extent
not previously paid, Executive shall be entitled to all bonuses payable to
Executive in accordance with Section 3(b) hereof for or with respect to any
calendar years prior to the calendar year in which such termination occurs and
(C) be entitled to the benefits set forth in Sections 3(c) hereof (or the after-
tax cash equivalent) up to the effective date of such termination, and be
entitled to the benefits set forth in Sections 3(d), 3(e), and 3(f) hereof up to
the date of such termination. For purposes of calculating Executive's pro rata
portion of any bonus pursuant to clause (B) in the previous sentence, if the
termination takes place prior to receipt by Executive of any Performance Bonus
Distribution, the Performance Bonus Distribution, a pro rata portion of which
Executive shall be entitled to receive, shall be deemed to be 50% of Executive's
then current annual Base Compensation. In the event Employer elects to suspend
Executive's right to Base Compensation and Performance Bonus Distributions, at
such time as Executive is able to resume the duties required under this
Agreement, Executive shall be entitled to receive Base Compensation and
Performance Bonus Distributions from the date Executive commences the
performance of such duties following the disability in accordance with the terms
and provisions of this Agreement. This Section 5(a)(iii) shall not limit the
entitlement of Executive, Executive's estate or beneficiaries to any disability
or other benefits available to Executive under any disability insurance or other
benefits plan or policy which is maintained by Employer for Executive's benefit.
For purposes of this Agreement, the "date of disability" shall mean the first
day of the consecutive period during which Executive fails to perform the duties
required by this Agreement due to illness, physical or mental disability or
other incapacity.
(b) Termination by Executive. (i) After Change of Control. Executive
may terminate this Agreement upon thirty (30) days' written notice to Employer
following any "change of control" of Employer and a resulting "diminution
event", each as defined below, but in no event later than two years after the
change of control event. Executive shall continue to perform, at the election of
Employer, Executive's duties under this Agreement for an additional thirty (30)
days following notice of termination. In such event, Executive shall (A) be paid
Executive's Base Compensation up to the effective date of such termination, (B)
be paid a pro rata portion of any bonus otherwise payable to Executive for or
with respect to the calendar year in which such termination occurs in accordance
with Section 3(b) hereof up to the effective date of such termination and, to
the extent not previously paid, Executive shall be entitled to all bonuses
payable to Executive in accordance with Section 3(b) hereof for or with respect
to any calendar years prior
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benefits set forth in Sections 3(c), 3(d), 3(e) and 3(f) hereof up to the
effective date of such termination and (D) receive an amount equal to two times
the sum of (1) Executive's then current annual Base Compensation and (2)
Executive's last annualized Performance Bonus Distribution (if the termination
takes place prior to receipt by Executive of any Performance Bonus Distribution,
the Performance Bonus Distribution shall be deemed to be 50% of Executive's then
current Base Compensation). For purposes of calculating Executive's pro rata
portion of any bonus pursuant to clause (B) in the previous sentence, if the
termination takes place prior to receipt by Executive of any Performance Bonus
Distribution, the Performance Bonus Distribution, a pro rata portion of which
Executive shall be entitled to receive, shall be deemed to be 50% of Executive's
then current annual Base Compensation. For purposes of this Agreement, in the
event Employer defaults in its obligation under Section 9 hereof and, as a
consequence thereof, Executive's employment with Employer (or Employer's
successor or assign) terminates, such termination shall be deemed to be a
termination under this Section 5(b)(i).
For purposes of this Section 5(b)(i), (A) a "change of control" of Employer
shall be deemed to have occurred if: (l) any person (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), including a "group" as defined in Section 13(d)(3) of the
Exchange Act (but excluding The Prime Group, Inc. or any of its affiliates or
any group in which The Prime Group, Inc. or any of its affiliates has a
significant interest and excluding a trustee or other fiduciary holding
securities under an employee benefit plan of Employer), becomes the beneficial
owner of shares of common stock of Employer having at least fifty percent (50%)
of the total number of votes that may be cast for the election of directors of
Employer; (2) the merger or other business combination of Employer, sale of all
or substantially all of Employer's assets or combination of the foregoing
transactions (a "Transaction"), other than a Transaction immediately following
which the shareholders of Employer immediately prior to the Transaction continue
to have a majority of the voting power in the resulting entity (excluding for
this purpose any shareholder, other than The Prime Group, Inc. and its
affiliates, owning directly or indirectly more than ten percent (10%) of the
shares of the other company involved in the Transaction); or (3) within any
twenty-four (24) month period beginning on or after the date hereof, the persons
who were directors of Employer immediately before the beginning of such period
(the "Incumbent Directors") shall cease to constitute at least a majority of the
Board or a majority of the board of directors of any successor to Employer,
provided that, any director who was not a director as of the date hereof shall
be deemed to be an Incumbent Director if such director was elected to the Board
by, or on the recommendation of or with the approval of, at least two-thirds of
the directors who then qualified as Incumbent Directors either actually or by
prior operation of this provision, unless such election, recommendation or
approval was the result of an actual or threatened election contest of the type
contemplated by Regulation 14a-11 promulgated under the Exchange Act or any
successor provision; and (B) a "diminution event" shall mean any material
diminution in (1) the duties and responsibilities of Executive (other than a
mere title change, unless the new title is not President) or (2) the
compensation package for Executive.
(ii) Without Good Reason. Executive may terminate this Agreement and
Executive's employment at any time for any reason or for no reason at all upon
thirty (30) days' written notice to Employer, during which period Executive
shall continue to perform Executive's
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termination of Executive's employment pursuant to this Section 5(b)(ii),
Executive shall (A) be paid Executive's Base Compensation in accordance with
Section 3(a) hereof up to the effective date of such termination, and, to the
extent not previously paid, Executive shall be entitled to all bonuses payable
to Executive in accordance with Section 3(b) hereof for or with respect to any
calendar years prior to the calendar year in which such termination occurs and
(B) be entitled to the benefits set forth in Sections 3(c), 3(d), 3(e) and 3(f)
hereof up to the effective date of such termination.
(c) Death. Notwithstanding any other provision of this Agreement,
this Agreement shall terminate on the date of Executive's death. In such event,
Executive shall (A) be paid Executive's Base Compensation in accordance with
Section 3(a) hereof up to the date of such death, (B) be paid a pro rata portion
of any bonus otherwise payable to Executive for or with respect to the calendar
year in which such death occurs in accordance with Section 3(b) hereof up to the
effective date of such death and, to the extent not previously paid, Executive
shall be entitled to all bonuses payable to Executive in accordance with Section
3(b) hereof for or with respect to any calendar years prior to the calendar year
in which such death occurs and (C) be entitled to the benefits set forth in
Sections 3(c) (or the after-tax cash equivalent), 3(d), 3(e) and 3(f) hereof up
to the date of such death. This Section 5(c) shall not limit the entitlement of
Executive, Executive's estate or beneficiaries under any insurance or other
benefits plan or policy which is maintained by Employer for Executive's benefit.
For purposes of calculating Executive's pro rata portion of any bonus pursuant
to clause (B) in the previous sentence, if the termination takes place prior to
receipt by Executive of any Performance Bonus Distribution, the Performance
Bonus Distribution, a pro rata portion of which Executive shall be entitled to
receive, shall be deemed to be 50% of Executive's then current annual Base
Compensation.
(d) Termination Compensation. In the event of a termination of this
Agreement pursuant to Section 5(a)(i) hereof, Employer shall pay to Executive,
within thirty (30) days of termination, an amount in one lump sum ("Termination
Compensation") equal to the product of (i) the sum of (a) Executive's then
current annual Base Compensation and (b) Executive's last annualized Performance
Bonus Distribution times (ii) a fraction, the numerator of which is the number
of days between such date of termination and expiration of the Employment Term,
and the denominator of which is 365. For purposes of calculating Executive's
Termination Compensation, if the termination takes place prior to receipt by
Executive of any Performance Bonus Distribution, the Performance Bonus
Distribution component of the Termination Compensation calculation shall be
deemed to be 50% of Executive's then current annual Base Compensation.
6. Covenants of Executive.
(a) No Conflicts. Executive represents and warrants that Executive is
not personally subject to any agreement, order or decree which restricts
Executive's acceptance of this Agreement and the performance of Executive's
duties with Employer hereunder.
(b) Non-Competition. In return for the performance of the management
duties described in Section 1 hereof, during the Employment Term, Executive
shall not, directly or
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behalf of any other person or entity with whom Executive may be employed or
associated, own any interest in, participate or engage in the day-to-day
supervision, management, development, marketing or operation of any office or
industrial real estate facilities or such other business as Employer may be
engaged in during the Employment Term (the "Business"). Furthermore, for a
period of one year after any applicable Section 5 termination event, Executive
shall not, directly or indirectly, solicit, attempt to hire or hire any employee
or client of Employer or solicit or attempt to lease space to or lease space to
any tenant of Employer. Notwithstanding the foregoing, nothing herein shall
prohibit Executive from (i) owning 5% or less of any securities of a competitor
engaged in the same Business if such securities are listed on a nationally
recognized securities exchange or traded over-the-counter on the National
Association of Securities Dealers Automated Quotation System or otherwise, (ii)
owning that certain 69-acre semi-improved industrial park located in
Libertyville, Illinois, the office/industrial buildings located at 801 and 000
Xxxxxxxxxx Xxx, Xxxxxxxxxxxx Business Park, Libertyville, Illinois, and any
other real property not purchased by Employer under the terms of the
Contribution Agreement between Executive, certain limited partnership controlled
by Executive and Employer, (iii) soliciting, attempting to hire or hiring Xxxxxx
Xxxxx and (iv) responding to contacts initiated by those tenants identified in
Exhibit A attached hereto which occupy facilities owned and/or operated by
Xxxxxx Xxxxxxxx and Executive (the "Tenants") and entering into leasing
transactions with such Tenants provided that such transactions do not result in
such Tenants relocating from a facility owned and/or operated by Employer, PGRC,
or any of their respective subsidiaries. Executive shall be entitled to manage
the buildings located at 801 and 000 Xxxxxxxxxx Xxx, Xxxxxxxxxxxx Xxxxxxxx Xxxx,
Xxxxxxxxxxxx, Xxxxxxxx prior to their acquisition by PGRC, on the business time
of Employer and Employer or PGRC or any of their respective subsidiaries will
not receive any fees with respect to such property.
(c) Non-Disclosure. During the Employment Term and for a period of
two years after the expiration or termination of this Agreement for any reason,
Executive shall not disclose or use, except in the pursuit of the Business for
or on behalf of Employer, any Trade Secret (as hereinafter defined) of Employer,
whether such Trade Secret is in Executive's memory or embodied in writing or
other physical form. For purposes of this Section 6(c), "Trade Secret" means any
information which derives independent economic value, actual or potential, with
respect to Employer from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use and is the subject of efforts to maintain its secrecy
that are reasonable under the circumstances, including, but not limited to,
trade secrets, customer lists, sales records and other proprietary commercial
information. Said term, however, shall not include general "know-how"
information acquired by Executive prior to or during the course of Executive's
service which could have been obtained by him from public sources without the
expenditure of significant time, effort and expense which does not relate to
Employer.
(d) Business Opportunities. During the Employment Term, Executive
agrees to bring to Employer any and all business opportunities which come to
Executive's attention for the acquisition, development, management, leasing or
marketing of real estate for industrial or office use. In the event that
Employer elects not to participate or take advantage of any such business
8
opportunity, upon termination of Executive's employment with Employer for any
reason, Executive shall be free to pursue such business opportunity, provided
that such business opportunity does not cause any tenant to relocate from a
facility owned and/or operated by Employer, PGRC or any of their respective
subsidiaries.
(e) Return of Documents. Upon termination of Executive's services with
Employer, Executive shall return all originals and copies of books, records,
documents, customer lists, sales materials, tapes, keys, credit cards and other
tangible property of Employer within Executive's possession or under Executive's
control.
(f) Equitable Relief. In the event of any breach by Executive of any
of the covenants contained in this Section 6, it is specifically understood and
agreed that Employer shall be entitled, in addition to any other remedy which it
may have, to equitable relief by way of injunction, an accounting or otherwise
and to notify any employer or prospective employer of Executive as to the terms
and conditions hereof.
(g) Acknowledgment. Executive acknowledges that Executive will be
directly and materially involved as a senior executive in all important policy
and operational decisions of Employer. Executive further acknowledges that the
scope of the foregoing restrictions has been specifically bargained between
Employer and Executive, each being fully informed of all relevant facts.
Accordingly, Executive acknowledges that the foregoing restrictions of Section 6
are fair and reasonable, are minimally necessary to protect Employer, its other
partners and the public from the unfair competition of Executive who, as a
result of Executive's performance of services on behalf of Employer, will have
had unlimited access to the most confidential and important information of
Employer, its business and future plans. Executive furthermore acknowledges that
no unreasonable harm or injury will be suffered by him from enforcement of the
covenants contained herein and that Executive will be able to earn a reasonable
livelihood following termination of Executive's services notwithstanding
enforcement of the covenants contained herein.
7. Prior Agreements. This Agreement, together with the Stock Incentive
Plan, supersedes and is in lieu of any and all other employment arrangements
between Executive and Employer or its predecessor or any subsidiary and any and
all such employment agreements and arrangements are hereby terminated and deemed
of no further force or effect.
8. Assignment. Neither this Agreement nor any rights or duties of
Executive hereunder shall be assignable by Executive and any such purported
assignment by him shall be void. Employer may assign all or any of its rights
hereunder provided that substantially all of the assets of Employer are also
transferred to the same party.
9. Successor to Employer. Employer 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 Employer, as the case may
be, by agreement in form and substance reasonably satisfactory to Executive,
expressly, absolutely and unconditionally to assume and agree to perform this
Agreement in the same manner and to the same extent that Employer would be
9
required to perform it if no such succession or assignment had taken place. Any
failure of Employer to obtain such agreement prior to the effectiveness of any
such succession or assignment shall be a material breach of this Agreement
giving Executive the right to terminate this Agreement, in which case Executive
shall be entitled to receive the compensation specified in Section 5(a)(i)
hereof. This Agreement shall inure to the benefit of and be enforceable by
Executive's personal and legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If Executive should die
while any amounts are still payable to Executive hereunder, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to Executive's devisee, legatee or other designee or, if there be
no such designee, to Executive's estate.
10. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and if personally delivered, sent by
courier or by certified mail, postage or delivery charges prepaid, to the
following addresses:
(a) if to Executive, to:
Xxxxxx X. Xxxxxxxx
0000 XxxXxxxxx Xxxx.
Xxxxxxxxxx, XX 00000
With a copy to:
--------------
Xxxxxxx & Xxxxxxxx Ltd.
000 X. Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxx
(b) if to Employer, to:
Prime Group Realty Corp.
Xxxxx 0000
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Chief Executive Officer
With a copy to:
--------------
Prime Group Realty Corp.
Xxxxx 0000
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: General Counsel
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and to:
-------
Winston & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
Any notice, claim, demand, request or other communication given as provided in
this Section 10, if delivered personally, shall be effective upon delivery; and
if given by courier, shall be effective one (1) business day after deposit with
the courier if next day delivery is guaranteed; and if given by certified mail,
shall be effective three (3) business days after deposit in the mail. Either
party may change the address at which it is to be given notice by giving written
notice to the other party as provided in this Section 10.
11. Amendment. This Agreement may not be changed, modified or amended
except in writing signed by both parties hereto.
12. Waiver of Breach. The waiver by either party of the breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by either party.
13. Severability. Employer and Executive each expressly agree and contract
that it is not the intention of either party to violate any public policy,
statutory or common law, and that if any covenant, sentence, paragraph, clause
or combination of the same of this Agreement (a "Contractual Provision") is in
violation of the law of any state where applicable, such Contractual Provision
shall be void in the jurisdictions where it is unlawful, and the remainder of
such Contractual Provision, if any, and the remainder of this Agreement shall
remain binding on the parties such that such Contractual Provision shall be
binding only to the extent that such Contractual Provision is lawful or may be
lawfully performed under then applicable laws. In the event that any part of any
Contractual Provision of this Agreement is determined by a court of competent
jurisdiction to be overly broad thereby making the Contractual Provision
unenforceable, the parties hereto agree, and it is their desire, that such court
shall substitute a judicially enforceable limitation in its place, and that the
Contractual Provision, as so modified, shall be binding upon the parties as if
originally set forth herein.
14. Indemnification by Executive. Executive shall indemnify Employer for
any and all damages, costs and expenses resulting from any material harm to
Employer, its business, assets or employees through an act of dishonesty,
material conflict of interest, gross misconduct or willful malfeasance by
Executive. Executive also shall indemnify Employer for any and all damages,
costs and expenses resulting from Executive's acts of omission constituting
reckless disregard of Executive's duties to Employer following notice thereof by
Employer after it becomes aware of such conduct and Executive's failure to so
cure within thirty (30) days.
15. Indemnification by Employer and Insurance. The Partnership Agreement
will contain normal and customary indemnification provisions whereby Employer
agrees to indemnify the
11
partners and officers of Employer, including Executive. In addition, during the
Employment Term, Employer shall maintain appropriate D&O insurance coverage in
such amount as may be determined by Employer in Employer's reasonable business
judgment for the benefit of Employer's partners and officers, including
Executive.
16. Governing Law. This Agreement shall be governed by, and construed,
interpreted and enforced in accordance with the laws of the State of Illinois,
exclusive of the conflict of laws provisions of the State of Illinois.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
EMPLOYER:
PRIME GROUP REALTY L.P.
By: Prime Group Realty Corp.,
its General Partner
By:____________________________
Title:_________________________
EXECUTIVE:
____________________________________
Xxxxxx X. Xxxxxxxx
13
EXHIBIT A
TENANTS
-------
1. Rank Video Services America, Inc.
2. Motorola, Inc.
3. Major Reflector/National Service Industries
4. Arlington Industries
5. Laboratory Corporation of America
6. Northern Illinois Clinical Laboratories
7. Lionstone International
8. Sun Space Designs
9. Production Associates
