Exhibit 10.117
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
FOR
XXXXXXX X. XXXXX
TABLE OF CONTENTS
PAGE
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1. EMPLOYMENT........................................................ 4
2. EMPLOYMENT PERIOD................................................. 4
3. SERVICES / PLACE OF EMPLOYMENT.................................... 5
4. COMPENSATION AND BENEFITS......................................... 6
5. TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL................... 8
6. COMPENSATION UPON TERMINATION OF EMPLOYMENT BY THE
COMPANY FOR CAUSE OR BY EXECUTIVE WITHOUT GOOD REASON........... 11
7. COMPENSATION UPON TERMINATION OF EMPLOYMENT UPON DEATH
OR DISABILITY................................................... 11
8. COMPENSATION UPON TERMINATION OF EMPLOYMENT BY THE COMPANY WITHOUT
CAUSE OR BY EXECUTIVE FOR GOOD REASON........................... 14
9. CHANGE IN CONTROL................................................. 15
10. MITIGATION / EFFECT ON EMPLOYEE BENEFIT PLANS AND PROGRAMS........ 18
11. CONFIDENTIAL INFORMATION.......................................... 19
12. RETURN OF DOCUMENTS............................................... 20
13. NONCOMPETE........................................................ 20
14. REMEDIES.......................................................... 22
15. INDEMNIFICATION/LEGAL FEES........................................ 22
16. SUCCESSORS AND ASSIGNS............................................ 23
17. TIMING OF AND NO DUPLICATION OF PAYMENTS.......................... 25
18. MODIFICATION OR WAIVER............................................ 25
19. NOTICES........................................................... 26
20. GOVERNING LAW..................................................... 26
21. SEVERABILITY...................................................... 26
22. LEGAL REPRESENTATION.............................................. 27
23. COUNTERPARTS...................................................... 27
24. HEADINGS.......................................................... 30
25. ENTIRE AGREEMENT.................................................. 30
26. SURVIVAL OF AGREEMENTS............................................ 30
XXXXXXX X. XXXXX
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (the "Agreement") is
entered into as of December __, 1997, by and between Xxxxxxx X. Xxxxx, an
individual residing at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000
("Executive"), and Xxxx-Xxxx Realty Corporation, a Maryland corporation with
offices at 00 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 (the "Company").
RECITALS
Whereas, Executive has served as Executive Vice President of the Company
pursuant to his prior employment agreement dated as of January 21, 1997 (the
"Prior Agreement") and prior thereto and, through such service, has acquired
special and unique knowledge, abilities and expertise;
Whereas, in connection with the combination of Cali Realty Corporation
with the Xxxx Companies (the "Xxxx Combination") the Prior Agreement is
hereby amended and restated in its entirety as of the closing of the Xxxx
Combination; and
Whereas, the Company desires to continue to employ Executive as Executive
Vice President, and Executive desires to continue to be employed by the
Company as Executive Vice President, pursuant to the amended and restated
terms set forth herein.
Now, Therefore, in consideration of the premises and the mutual covenants
and agreements set forth herein, the parties hereby agree as follows:
1. Employment.
The Company hereby agrees to employ Executive, and Executive hereby
agrees to accept such employment during the period and upon the terms and
conditions set forth in this Agreement.
2. Employment Period.
(a) Except as otherwise provided in this Agreement to the contrary, the
terms and conditions of this Agreement shall be and remain in effect during
the period of employment (the "Employment Period") established under this
Paragraph 2. The initial Employment Period shall be for a term commencing on
the date of this Agreement and ending on the fifth anniversary of the date of
this Agreement provided, however, that commencing on the day after the date
of this Agreement and on each day thereafter, the Employment Period shall be
extended for one additional day so that a constant five (5) year Employment
Period shall be in effect, unless (i) the Company or Executive elects not to
extend the term of this Agreement by giving written notice to the other party
in accordance with Paragraph 19, in which case, subject to the provisions of
sub-paragraph 5(a)(iv) below, the term of this Agreement shall become fixed
and shall end on the fifth anniversary of the date of such written notice
("Notice of Non-Renewal"), or (ii) Executive's employment terminates
hereunder.
(b) Notwithstanding anything contained herein to the contrary: (i)
Executive's employment with the Company may be terminated by the Company or
Executive during the Employment Period, subject to the terms and conditions
of this Agreement; and (ii) nothing in this Agreement shall mandate or
prohibit a continuation
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of Executive's employment following the expiration of the Employment Period
upon such terms and conditions as the Board of Directors of the Company (the
"Board") and Executive may mutually agree.
(c) If Executive's employment with the Company is terminated, for
purposes of this Agreement the term "Unexpired Employment Period" shall mean
the period commencing on the date of such termination and ending on the last
day of the Employment Period.
3. Services / Place of Employment.
(a) Services. During the Employment Period, Executive shall hold the
position of Executive Vice President of the Company. Executive shall devote
his best efforts and substantially all of his business time, skill and
attention to the business of the Company (other than absences due to
vacation, illness, disability or approved leave of absence), and shall
perform such duties as are customarily performed by similar executive
officers and as may be more specifically enumerated from time to time by the
Chief Executive Officer and President; provided, however, that the foregoing
is not intended to (a) preclude Executive from (i) owning and managing
personal investments, including real estate investments, subject to the
restrictions set forth in Paragraph 13 hereof or (ii) engaging in charitable
activities and community affairs, or (b) restrict or otherwise limit
Executive from conducting the activities described in Schedule A, attached
hereto, (the "Excluded Activities "), provided that the performance of the
activities referred to in clauses (a) and (b) does not prevent Executive from
devoting substantially all of his business time to the Company.
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(b) Place of Employment. The principal place of employment of Executive
shall be at the Company's principal executive offices in Cranford, New Jersey.
4. Compensation and Benefits.
(a) Salary. During the Employment Period, the Company shall pay Executive
a minimum annual base salary in the amount of $325,000 (the "Annual Base
Salary") payable in accordance with the Company's regular payroll practices.
Executive's Annual Base Salary shall be reviewed annually in accordance with
the policy of the Company from time to time and may be subject to upward
adjustment based upon, among other things, Executive's performance, as
determined in the sole discretion of the Chief Executive Officer and the
President. In no event shall Executive's Annual Base Salary in effect at a
particular time be reduced without his prior written consent.
(b) Incentive Compensation/Bonuses. In addition, Executive shall be
eligible for incentive compensation payable each year in such amounts as may
be determined by the Option and Executive Compensation Committee of the Board
(the "Compensation Committee") based upon, among other factors, growth in
Funds from Operations per Common Share (as hereinafter defined) for the year.
Executive shall be entitled to receive such bonuses and options to purchase
shares of common stock, par value $0.01 per share, of the Company (the
"Common Stock") as the Board or the Compensation Committee as the case may be
shall approve, in its sole discretion, including, without limitation, options
and bonuses contingent upon Executive's
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performance and the achievement of specified financial and operating
objectives for Funds from Operations per Common Share. For purposes of this
Agreement, "Funds from Operations per Common Share" for any period shall mean
(i) net income (loss) before minority interest of unit holders, computed in
accordance with generally accepted accounting principles ("GAAP"), excluding
gains (or losses) from debt restructuring and sale of property, plus real
estate return, depreciation and amortization as calculated in accordance with
the National Association of Real Estate Investment Trusts definition
published in March 1995, as amended from time to time, and as applied in
accordance with the accounting practices and policies of the Company in
effect from time to time on a consistent basis to the entire Employment
Period, divided by (ii) the sum of (A) the primary weighted average number of
outstanding shares of Common Stock as it appears in the Company's financial
statement for the applicable period and (B) the primary weighted average
number of outstanding common limited partnership units ("Common OP Units") of
Xxxx-Xxxx Realty, L.P., a Delaware limited partnership (the "Partnership") of
which the Company is the sole general partner, for the applicable period. All
classes of preferred stock which are convertible into Common Stock and all
classes of preferred or other units which are convertible into Common OP
Units shall be treated as if they have been converted into Common Stock or
Common OP Units and shall be included in the denominator, irrespective of any
waiting period which must elapse prior to conversion.
(c) Taxes and Withholding. The Company shall have the right to deduct and
withhold from all compensation all social security and other federal, state
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and local taxes and charges which currently are or which hereafter may be
required by law to be so deducted and withheld.
(d) Additional Benefits. In addition to the compensation specified above
and other benefits provided pursuant to this Paragraph 4, Executive shall be
entitled to the following benefits:
(i) participation in the Employee Stock Option Plan of Cali Realty
Corporation, the Cali Realty Corporation 401(k) Savings and
Retirement Plan (subject to statutory rules and maximum
contributions and non-discrimination requirements applicable to
401(k) plans) and such other benefit plans and programs ,
including but not limited to restricted stock, phantom stock
and/or unit awards, loan programs and any other incentive
compensation plans or programs (whether or not employee benefit
plans or programs), as maintained by the Company from time to
time and made generally available to executives of the Company
with such participation to be consistent with reasonable Company
guidelines;
(ii) participation in any health insurance, disability insurance,
paid vacation, group life insurance or other welfare benefit
program made generally available to executives of the Company;
and
(iii) reimbursement for reasonable business expenses incurred by
Executive in furtherance of the interests of the Company
including a monthly allowance of twelve hundred ($1,200) which
is intended to cover the cost of local business-related travel
expenses exclusive of amounts paid to third-parties (e.g. taxi
service).
5. Termination of Employment and Change in Control.
(a) Executive's employment hereunder may be terminated during the
Employment Period under the following circumstances:
(i) Cause. The Company shall have the right to terminate Executive's
employment for Cause upon Executive's: (A) willful and continued
failure to use best efforts to substantially perform his duties
hereunder (other than any such failure resulting from
Executive's incapacity due to physical or mental illness) for a
period of thirty (30) days after written demand for substantial
performance is
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delivered by the Company specifically identifying the manner in
which the Company believes Executive has not substantially
performed his duties; (B) willful misconduct and/or willful
violation of Paragraph 11 hereof, which is materially
economically injurious to the Company and the Partnership taken
as a whole; (C) the willful violation of the provisions of
Paragraph 13 hereof; or (D) conviction of, or plea of guilty to
a felony. For purposes of this sub-paragraph 5(a), no act, or
failure to act, on Executive's part shall be considered
"willful" unless done, or omitted to be done, by him (I) not in
good faith and (II) without reasonable belief that his action or
omission was in furtherance of the interests of the Company.
(ii) Death. Executive's employment hereunder shall terminate upon his
death.
(iii) Disability. The Company shall have the right to terminate
Executive's employment due to "Disability" in the event that
there is a determination by the Company, upon the advice of an
independent qualified physician, reasonably acceptable to
Executive, that Executive has become physically or mentally
incapable of performing his duties under this Agreement and such
disability has disabled Executive for a cumulative period of one
hundred eighty (180) days within a twelve (12) month period.
(iv) Good Reason. Executive shall have the right to terminate his
employment for "Good Reason": (A) upon the occurrence of any
material breach of this Agreement by the Company which shall
include but not be limited to; an assignment to Executive of
duties materially and adversely inconsistent with Executive's
status as Executive Vice President or a material or adverse
alteration in the nature of or diminution in Executive's duties
and/or responsibilities, reporting obligations, titles or
authority; (B) upon a reduction in Executive's Annual Base
Salary or a material reduction in other benefits (except for
bonuses or similar discretionary payments) as in effect at the
time in question, a failure to pay such amounts when due or any
other failure by the Company to comply with Paragraph 4 hereof;
(C) within six (6) months following the date a Notice of
Non-Renewal is issued by the Company pursuant to Paragraph 2
hereof; (D) on or within six (6) months following a Change in
Control (as hereinafter defined) in accordance with the
provisions set forth in sub-paragraph 5(a)(vii) hereof; (E) any
purported termination of Executive's employment for Cause which
is not effected pursuant to the procedures of sub-paragraph
5(a)(i) (and for purposes of this Agreement, in the event of
such failure to comply, no such purported termination shall be
effective); or (F)
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upon the relocation of the Company's principal executive offices
or Executive's own office location to a location more than
thirty (30) miles away from Cranford, New Jersey.
(v) Without Cause. The Company shall have the right to terminate the
Executive's employment hereunder without Cause subject to the
terms and conditions of this Agreement.
(vi) Without Good Reason. The Executive shall have the right to
terminate his employment hereunder without Good Reason subject
to the terms and conditions of this Agreement.
(vii) Change in Control. Executive shall have the right to terminate
his employment hereunder on or within six (6) months following a
Change in Control. Such termination shall be deemed a
termination for Good Reason hereunder. For purposes of this
Agreement "Change in Control" shall mean that any of the
following events has occurred: (A) any "person" or "group" of
persons, as such terms are used in Sections 13 and 14 of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), other than any employee benefit plan sponsored by the
Company, becomes the "beneficial owner", as such term is used in
Section 13 of the Exchange Act, (irrespective of any vesting or
waiting periods) of (I) Common Stock or any class of stock
convertible into Common Stock and/or (II) Common OP Units or
preferred units or any other class of units convertible into
Common OP Units, in an amount equal to twenty (20%) percent or
more of the sum total of the Common Stock and the Common OP
Units (treating all classes of outstanding stock, units or other
securities convertible into stock units as if they were
converted into Common Stock or Common OP Units as the case may
be and then treating Common Stock and Common OP Units as if they
were a single class) issued and outstanding immediately prior to
such acquisition as if they were a single class and disregarding
any equity raise in connection with the financing of such
transaction; (B) any Common Stock is purchased pursuant to a
tender or exchange offer other than an offer by the Company; (C)
the dissolution or liquidation of the Company or the
consummation of any merger or consolidation of the Company or
any sale or other disposition of all or substantially all of its
assets, if the shareholders of the Company and unitholders of the
Partnership taken as a whole and considered as one class
immediately before such transaction own, immediately after
consummation of such transaction, equity securities and
partnership units possessing less than fifty (50%) percent of
the surviving or acquiring company and partnership taken as a
whole;
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or (D) a turnover, during any two (2) year period, of the
majority of the members of the Board, without the consent of the
remaining members of the Board as to the appointment of the new
Board members.
(b) Notice of Termination. Any termination of Executive's employment by
the Company or any such termination by Executive (other than on account of
death) shall be communicated by written Notice of Termination to the other
party hereto. For purposes of this Agreement, a "Notice of Termination" shall
mean a notice which shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of Executive's
employment under the provision so indicated. In the event of the termination
of Executive's employment on account of death, written Notice of Termination
shall be deemed to have been provided on the date of death.
6. Compensation Upon Termination of Employment By the Company for Cause
or By Executive without Good Reason.
In the event the Company terminates Executive's employment for Cause or
Executive terminates his employment without Good Reason, the Company shall
pay Executive any unpaid Annual Base Salary at the rate then in effect
accrued through and including the date of termination. In addition, in such
event, Executive shall be entitled (i) to receive any earned but unpaid
incentive compensation or bonuses and (ii) to exercise any options which have
vested and are exercisable in accordance with the terms of the applicable
option grant agreement or plan.
Except for any rights which Executive may have to unpaid salary amounts
through and including the date of termination, earned but unpaid incentive
9
compensation or bonuses and vested options, the Company shall have no further
obligations hereunder following such termination. The aforesaid amounts shall
be payable in full immediately upon such termination.
7. Compensation Upon Termination of Employment Upon Death or Disability.
In the event of termination of Executive's employment as a result of
either Executive's death or Disability, the Company shall pay to Executive,
his estate or his personal representative (i) the unpaid Annual Base Salary
at the rate then in effect through the end of the Unexpired Employment Period
(the "Annual Base Salary Payment"); (ii) a pro-rata portion, based upon the
number of days in the period beginning with the date of the termination of
Executive's employment due to death or Disability and ending with the last
day of the Unexpired Employment Period, of the cash equivalent of the average
annual amount of all other compensation based on the average of the last two
(2) calendar years immediately preceding the year in which Executive's
termination of employment occurs including, without limitation, incentive
compensation payments, bonuses and stock based compensation (e.g., stock
options, restricted stock awards, etc.) paid, granted or accreted to
Executive during such years (the "Pro-Rata Portion of Other Compensation")
and (iii) reimbursement of expenses incurred prior to date of termination
("Expense Reimbursement"). The aforesaid amounts shall be payable in cash
without discount for early payment, at the option of Executive, his estate or
his personal representative, either in full immediately upon such termination
or monthly over the Unexpired Employment Period (the "Payment Election"). In
the event of termination of employment due to Disability, Executive shall
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also receive continuation of health coverage through the end of the Unexpired
Employment Period on the same basis as health coverage is provided by the
Company for active employees and as may be amended from time to time
("Medical Continuation").
In addition, all (A) incentive compensation payments or programs of any
nature whether stock based or otherwise that are subject to a vesting
schedule including, without limitation, restricted stock, phantom stock,
units and any loan forgiveness arrangements granted to Executive ("Incentive
Compensation") shall immediately vest as of the date of such termination
("Vested Incentive Compensation") and (B) options granted to Executive shall
immediately vest as of the date of such termination (the "Vested Options")
and Executive shall be entitled at the option of Executive, his estate or his
personal representative, within one (1) year of the date of such termination,
to exercise any options which have vested (including, without limitation, by
acceleration in accordance with the terms of this Agreement, the applicable
option grant agreement or plan) and are exercisable in accordance with the
terms of the applicable option grant agreement or plan and/or any other
methods or procedures for exercise applicable to optionees or to require the
Company (upon written notice delivered within one hundred eighty (180) days
following the date of Executive's termination) to repurchase all or any
portion of Executive's vested options to purchase shares of Common Stock at a
price equal to the difference between the Repurchase Fair Market Value (as
hereinafter defined) of the shares of Common Stock for which the options to
be repurchased are exercisable and the exercise price of such options as of
the date of Executive's termination of employment (the "Vested Option
Exercise Election"). In the event of a
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conflict between any option grant agreement or plan and this Agreement, the
terms of this Agreement shall control.
Except for any rights which Executive may have to all of the above
including the Annual Base Salary Payment, the Pro-Rata Portion of Other
Compensation, Vested Incentive Compensation, Vested Options, Expense
Reimbursement and in the event of a termination of employment due to
Disability, Medical Continuation, the Company shall have no further
obligations hereunder following such termination.
For purposes of this Agreement, "Repurchase Fair Market Value" shall mean
the average of the closing price on the New York Stock Exchange (or such
other exchange on which the Common Stock is primarily traded) of the Common
Stock on each of the trading days within the thirty (30) days immediately
preceding the date of termination of Executive's employment.
8. Compensation Upon Termination of Employment By the Company Without
Cause or By Executive for Good Reason.
In the event the Company terminates Executive's employment for any reason
other than Cause or Executive terminates his employment for Good Reason, the
Company shall pay to Executive and Executive shall be entitled to receive the
greater of (i) three million two hundred thousand dollars ($3,200,000) with
such amount subject only to upwards adjustment from time to time by the
Compensation Committee (the "Fixed Amount") or (ii) the sum total of (A) the
Annual Base Salary Payment and (B) the Pro-Rata Portion of Other
Compensation. The aforesaid amount shall be payable in
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cash without discount for early payment, at the option of Executive, either
in full immediately upon such termination or monthly over the Unexpired
Employment Period.
In addition, the Executive shall be entitled to receive Vested Incentive
Compensation, Vested Options exercisable pursuant to the Vested Option
Exercise Election, Medical Continuation, and Expense Reimbursement. Executive
understands that any options exercised more than ninety (90) days following
the date of his termination of employment which were granted as incentive
stock options shall automatically be converted into non-qualified options.
Except for any rights which Executive may have to Vested Incentive
Compensation, Vested Options, Medical Continuation and Expense Reimbursement
and either the Fixed Amount or in lieu thereof to the Annual Base Salary
Payment, and the Pro-Rata Portion of Other Compensation (as defined in
Paragraph 7), the Company shall have no further obligations hereunder
following such termination. The parties both agree that the agreement to make
these payments was consideration and an inducement to obtain Executive's
consent to enter into this Agreement. The payments are not a penalty and
neither party will claim them to be a penalty. Rather, the payments represent
a fair approximation of reasonable amounts due to Executive for the
Employment Period.
9. Change in Control.
(a) Options. Any Incentive Compensation and options granted to Executive
that have not vested as of the date of a Change in Control shall immediately
vest upon the date of the Change in Control. Neither the occurrence of a
Change in
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Control, nor the vesting in any options as a result thereof shall require
Executive to exercise any options. In the event of a conflict between any
Incentive Compensation grant agreement or program or any option grant
agreement or plan and this Agreement, the terms of this Agreement shall
control.
(b) Upon Termination. In the event Executive terminates his employment on
or following a Change in Control as set forth in sub-paragraph 5(a)(vii), the
Company shall pay to Executive and Executive shall be entitled to all the
payments and rights Executive would have had if Executive had terminated his
employment with Good Reason as set forth in Paragraph 8.
The aforesaid amount shall be payable in accordance with Executive's
Payment Election.
Except for any rights which Executive may have to Vested Incentive
Compensation, Vested Options (including, without limitation, by acceleration
in accordance with sub-paragraph 9(a)), Medical Continuation, Expense
Reimbursement and the Excise Tax Gross Up set forth in subparagraph 9(d), and
either the Fixed Amount or in lieu thereof to the Annual Base Salary Payment,
and the Pro-Rata Portion of Other Compensation (as defined in Paragraph 7),
the Company shall have no further obligations hereunder following such
termination.
(c) Retention Payment. Prior to the date of a Change in Control and
subject to the approval of the Board, Executive may make an election to
receive, as a retention payment, the payments and rights set forth
sub-paragraph 9(b) above (the "Retention Payment") and remain in the employ
of the successor after the Change in Control. In the event that Executive
makes such election and the Board approves the
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same, this Agreement shall remain in full force and effect except that (i)
simultaneously with the receipt of the Retention Payment, Executive shall
waive any right to receive any additional payment as a direct result of such
Change in Control, and (ii) other than with respect to the consummation of a
subsequent transaction which constitutes a Change in Control and is unrelated
to the Change in Control with respect to which the Retention Payment was
paid, termination payments otherwise due subsequently under this Agreement
for any event requiring payment of termination payments under this Agreement
which occurs within the six (6) month period immediately following the date
of the Change In Control as to which the Retention Payment was paid shall be
reduced by the Retention Payment paid to Executive on the date of the Change
in Control.
Any cash payments owed to Executive pursuant to this sub-paragraph 9(c)
shall be paid to Executive in a single sum without discount for early payment
at the time of the Change in Control but prior to the consummation of the
transaction with any successor.
(d) Excise Tax Gross Up. In addition, if it is determined by an
independent accountant mutually acceptable to the Company and Executive that
as a result of any payment in the nature of compensation made by the Company
to (or for the benefit of) Executive pursuant to this Agreement or otherwise,
an excise tax may be imposed on Executive pursuant to Section 4999 of the
Code (or any successor provisions), the Company shall pay Executive in cash
an amount equal to X determined under the following formula: (the "Excise Tax
Gross Up"):
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E x P
X = ----------------------------------
1-[(FI x (1-SLI)) + SLI + E + M]
where
E = the rate at which the excise tax is assessed under Section 4999 of
the Code (or any successor provisions);
P = the amount with respect to which such excise tax is assessed,
determined without regard to the Excise Tax Gross Up;
FI = the highest effective marginal rate of income tax applicable to
Executive under the Code for the taxable year in question (taking into
account any phase-out or loss of deductions, personal exemptions or
other similar adjustments);
SLI = the sum of the highest effective marginal rates of income tax
applicable to Executive under all applicable state and local laws
for the taxable year in question (taking into account any phase-out
or loss of deductions, personal exemptions and other similar
adjustments); and
M = the highest marginal rate of Medicare tax applicable to Executive
under the Code for the taxable year in question.
With respect to any payment in the nature of compensation that is made to (or
for the benefit of) Executive under the terms of this Agreement or otherwise
and on which an excise tax under Section 4999 of the Code (or any successor
provisions) may be assessed, the payment determined under this sub-paragraph
9(d) shall be paid to Executive at the time of the Change in Control but
prior to the consummation of the transaction with any successor. It is the
intention of the parties that the Company provide Executive with a full tax
gross-up under the provisions of this Paragraph, so that on a net after-tax
basis, the result to Executive shall be the same as if the excise tax under
Section 4999 of the Code (or any successor provisions) had not been
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imposed. The Excise Tax Gross Up may be adjusted if alternative minimum tax
rules are applicable to Executive.
10. Mitigation / Effect on Employee Benefit Plans and Programs.
(a) Mitigation. Executive shall not be required to mitigate amounts
payable under this Agreement by seeking other employment or otherwise, and
there shall be no offset against amounts due Executive under this Agreement
on account of subsequent employment. Amounts owed to Executive under this
Agreement shall not be offset by any claims the Company may have against
Executive and such payment shall not be affected by any other circumstances,
including, without limitation, any counterclaim, recoupment, defense, or
other right which the Company may have against Executive or others.
(b) Effect on Employee Benefit Programs. The termination of Executive's
employment hereunder, whether by the Company or Executive, shall have no
effect on the rights and obligations of the parties hereto under the
Company's (i) welfare benefit plans including, without limitation, Medical
Continuation as provided for herein and, health coverage thereafter but only
to the extent required by law, and on the same basis applicable to other
employees and (ii) 401(k) Plan but only to the extent required by law and
pursuant to the terms of the 401(k) Plan.
11. Confidential Information.
(a) Executive understands and acknowledges that during his employment
with the Company, he will be exposed to Confidential Information (as
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defined below), all of which is proprietary and which will rightfully belong
to the Company. Executive shall hold in a fiduciary capacity for the benefit
of the Company such Confidential Information obtained by Executive during his
employment with the Company and shall not, directly or indirectly, at any
time, either during or after his employment with the Company, without the
Company's prior written consent, use any of such Confidential Information or
disclose any of such Confidential Information to any individual or entity
other than the Company or its employees, attorneys, accountants, financial
advisors, consultants, or investment bankers except as required in the
performance of his duties for the Company or as otherwise required by law.
Executive shall take all reasonable steps to safeguard such Confidential
Information and to protect such Confidential Information against disclosure,
misuse, loss or theft.
(b) The term "Confidential Information" shall mean any information not
generally known in the relevant trade or industry or otherwise not generally
available to the public, which was obtained from the Company or its
predecessors or which was learned, discovered, developed, conceived,
originated or prepared during or as a result of the performance of any
services by Executive on behalf of the Company or its predecessors. For
purposes of this Paragraph 11, the Company shall be deemed to include any
entity which is controlled, directly or indirectly, by the Company and any
entity of which a majority of the economic interest is owned, directly or
indirectly, by the Company.
12. Return of Documents.
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Except for such items which are of a personal nature to Executive (e.g.,
daily business planner), all writings, records, and other documents and
things containing any Confidential Information shall be the exclusive
property of the Company, shall not be copied, summarized, extracted from, or
removed from the premises of the Company, except in pursuit of the business
of the Company and at the direction of the Company, and shall be delivered to
the Company, without retaining any copies, upon the termination of
Executive's employment or at any time as requested by the Company.
13. Noncompete.
Executive agrees that:
(a) During the Employment Period and, in the event (i) the Company
terminates Executive's employment for Cause, or (ii) Executive terminates his
employment without Good Reason, for a one (1) year period thereafter,
Executive shall not, directly or indirectly, within the continental United
States, engage in, or own, invest in, manage or control any venture or
enterprise primarily engaged in any office-service, flex, or office property
development, acquisition or management activities without regard to whether
or not such activities compete with the Company. Nothing herein shall
prohibit Executive from being a passive owner of not more than five percent
(5%) of the outstanding stock of any class of securities of a corporation or
other entity engaged in such business which is publicly traded, so long as he
has no active participation in the business of such corporation or other
entity. Moreover, the foregoing limitations shall not be deemed to restrict
or otherwise limit Executive from conducting the Excluded Activities, if any,
provided that during the Employment Period
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the performance of such activities does not prevent Executive from devoting
substantially all of his business time to the Company.
(b) If, at the time of enforcement of this Paragraph 13, a court shall
hold that the duration, scope, area or other restrictions stated herein are
unreasonable, the parties agree that reasonable maximum duration, scope, area
or other restrictions may be substituted by such court for the stated
duration, scope, area or other restrictions and upon substitution by such
court, this Agreement shall be automatically modified without further action
by the parties hereto.
(c) For purposes of this Paragraph 13, the Company shall be deemed to
include any entity which is controlled, directly or indirectly, by the
Company and any entity of which a majority of the economic interest is owned,
directly or indirectly, by the Company.
14. Remedies.
The parties hereto agree that the Company would suffer irreparable harm
from a breach by Executive of any of the covenants or agreements contained in
Paragraphs 11, 12 or 13 of this Agreement. Therefore, in the event of the
actual or threatened breach by Executive of any of the provisions of
Paragraphs 11, 12 or 13 of this Agreement, the Company may, in addition and
supplementary to other rights and remedies existing in its favor, apply to
any court of law or equity of competent jurisdiction for specific performance
and/or injunctive or other relief in order to enforce or prevent any
violation of the provisions thereof.
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15. Indemnification/Legal Fees.
(a) Indemnification. In the event the Executive is made party or
threatened to be made a party to any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "Proceeding"), by reason
of Executive's employment with or serving as an officer or director of the
Company, whether or not the basis of such Proceeding is alleged action in an
official capacity, the Company shall indemnify, hold harmless and defend
Executive to the fullest extent authorized by Maryland law, as the same
exists and may hereafter be amended, against any and all claims, demands,
suits, judgments, assessments and settlements including all expenses incurred
or suffered by Executive in connection therewith (including, without
limitation, all legal fees incurred using counsel reasonably acceptable to
Executive) and such indemnification shall continue as to Executive even after
Executive is no longer employed by the Company and shall inure to the benefit
of his heirs, executors, and administrators. Expenses incurred by Executive
in connection with any Proceeding shall be paid by the Company in advance
upon request of Executive that the Company pay such expenses; but, only in
the event that Executive shall have delivered in writing to the Company an
undertaking to reimburse the Company for expenses with respect to which
Executive is not entitled to indemnification. The provisions of this
Paragraph shall remain in effect after this Agreement is terminated
irrespective of the reasons for termination. The indemnification provisions
of this Paragraph shall not supersede or reduce any indemnification provided
to Executive under any separate agreement, or the
21
by-laws of the Company since it is intended that this Agreement shall expand
and extend the Executive's rights to receive indemnity.
(b) Legal Fees. If any contest or dispute shall arise between the Company
and Executive regarding or as a result of any provision of this Agreement,
the Company shall reimburse Executive for all legal fees and expenses
reasonably incurred by Executive in connection with such contest or dispute,
but only if Executive is successful in respect of substantially all of
Executive's claims pursued or defended in connection with such contest or
dispute. Such reimbursement shall be made as soon as practicable following
the resolution of such contest or dispute (whether or not appealed).
16. Successors and Assigns.
(a) The Company shall require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all
of the business and/or assets of the Company, by agreement in form and
substance satisfactory to Executive, to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the Company
would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such agreement prior to the effectiveness of
an such succession shall be a breach of this Agreement and shall entitle
Executive to compensation from the Company in the same amount and on the same
terms as he would be entitled to hereunder if Executive terminated his
employment hereunder within six (6) months of a Change in Control as set
forth in Paragraph 9, except that for purposes of implementing the foregoing,
the
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date on which any such succession becomes effective shall be deemed the date
of termination. In the event of such a breach of this Agreement, the Notice
of Termination shall specify such date as the date of termination. As used in
this Agreement, "Company" shall mean the Company as hereinbefore defined and
any successor to all or substantially all of its business and/or its assets
as aforesaid which executes and delivers the agreement provided for in this
Paragraph 16 or which otherwise becomes bound by all the terms and provisions
of this Agreement by operation of law. Any cash payments owed to Executive
pursuant to this Paragraph 16 shall be paid to Executive in a single sum
without discount for early payment immediately prior to the consummation of
the transaction with such successor.
(b) This Agreement and all rights of Executive hereunder may be
transferred only by will or the laws of descent and distribution. Upon
Executive's death, this Agreement and all rights of Executive hereunder shall
inure to the benefit of and be enforceable by Executive's beneficiary or
beneficiaries, personal or legal representatives, or estate, to the extent
any such person succeeds to Executive's interests under this Agreement.
Executive shall be entitled to select and change a beneficiary or
beneficiaries to receive any benefit or compensation payable hereunder
following Executive's death by giving Company written notice thereof. If
Executive should die following the date of termination while any amounts
would still be payable to him hereunder if he had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to such person or persons so appointed in writing
by Executive, including, without limitation, under any applicable plan, or
otherwise to his legal representatives or estate.
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17. Timing of and No Duplication of Payments.
All payments payable to Executive pursuant to this Agreement shall be
paid as soon as practicable after such amounts have become fully vested and
determinable. In addition, Executive shall not be entitled to receive
duplicate payments under any of the provisions of this Agreement.
18. Modification or Waiver.
No amendment, modification, waiver, termination or cancellation of this
Agreement shall be binding or effective for any purpose unless it is made in
a writing signed by the party against whom enforcement of such amendment,
modification, waiver, termination or cancellation is sought. No course of
dealing between or among the parties to this Agreement shall be deemed to
affect or to modify, amend or discharge any provision or term of this
Agreement. No delay on the part of the Company or Executive in the exercise
of any of their respective rights or remedies shall operate as a waiver
thereof, and no single or partial exercise by the Company or Executive of any
such right or remedy shall preclude other or further exercise thereof. A
waiver of right or remedy on any one occasion shall not be construed as a bar
to or waiver of any such right or remedy on any other occasion.
The respective rights and obligations of the parties hereunder shall
survive the Executive's termination of employment and termination of this
Agreement to the extent necessary for the intended preservation of such
rights and obligations.
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19. Notices.
All notices or other communications required or permitted hereunder shall
be made in writing and shall be deemed to have been duly given if delivered
by hand or delivered by a recognized delivery service or mailed, postage
prepaid, by express, certified or registered mail, return receipt requested,
and addressed to the Company or Executive, as applicable, at the address set
forth above (or to such other address as shall have been previously provided
in accordance with this Paragraph 19).
20. Governing Law.
This agreement will be governed by and construed in accordance with the
laws of the State of New Jersey except as to Paragraph 15(a), without regard
to principles of conflicts of laws thereunder.
21. Severability.
Whenever possible, each provision and term of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision or term of this Agreement shall be held to be prohibited
by or invalid under such applicable law, then, subject to the provisions of
sub-paragraph 13(b) above, such provision or term shall be ineffective only
to the extent of such prohibition or invalidity, without invalidating or
affecting in any manner whatsoever the remainder of such provisions or term
or the remaining provisions or terms of this Agreement.
22. Legal Representation.
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Each of the Company and Executive have been represented by counsel with
respect to this Agreement.
23. Counterparts.
This Agreement may be executed in separate counterparts, each of which is
deemed to be an original and both of which taken together shall constitute
one and the same agreement.
24. Headings.
The headings of the Paragraphs of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part hereof and
shall not affect the construction or interpretation of this Agreement.
25. Entire Agreement.
This Agreement constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes all other prior
agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof. The parties recognize that the Prior
Agreement has been amended and restated in its entirety by this Agreement and
the terms of the Prior Agreement are of no further force and effect.
26. Survival of Agreements.
The covenants made in Paragraphs 5 through 15 and 21 each shall survive
the termination of this Agreement.
26
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
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In Witness Whereof, the undersigned have executed this agreement as of
THE date first above written.
XXXX-XXXX REALTY CORPORATION
By: ------------------------------
Name:
Title:
-------------------------------
Xxxxxxx X. Xxxxx
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SCHEDULE A
1. Conducting the real estate development, acquisition or management
activities as and to the extent permitted pursuant to Section 26 of the
Contribution and Exchange Agreement dated January 24, 1997 by and between
Cali, CRLP and Xxxxxx Xxxxxx Company, LLC and Xxxxxx Xxxxxx-Eastview North
Company, L.P. (the "Contribution and Exchange Agreement")
2. Acquiring and conducting real estate development and management activities
with respect to properties which may be purchased by the Executive pursuant
to Sections 8.3 or 27.5 of the Contribution and Exchange Agreement,
29