EXHIBIT 10.47
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into as of the
31st day of January, 2001 between Home Properties of New York, L.P., a New York
limited partnership (the "Company"), Home Properties of New York, Inc., a
Maryland corporation ("HME") and Xxxxxx X. Xxxxxxxxxx, an individual residing
at 0 Xxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx 00000 ("Employee").
WHEREAS, the Company and Employee desire to enter into this Employment
Agreement to formalize the terms pursuant to which Employee will be employed by
the Company;
NOW THEREFORE, in consideration of the mutual promises, benefits and covenants
herein contained, the Company and Employee hereby agree as follows:
1. Effective Date; Term.
(a) This Agreement shall be effective on the Employee's commencement of
employment by the Company, which shall be a date selected by Employee but no
later than February 5, 2001 (the "Commencement Date").
(b) The Company employs Employee, and Employee accepts such employment,
for a period commencing on the Commencement Date and ending December 31, 2003
(the "Term").
2. Duties. During the term of this Agreement, the Company shall cause
Employee to serve in the capacity of Executive Vice President of Home
Properties of New York, Inc. or in any other capacity as agreed to by Employee
and the Chairman and President of HME. Employee shall report to and perform
such duties as may be determined by the Chairman and the President of HME. At
the first meeting of the Board of Directors of HME (the "Board") occurring
after the Commencement Date, Employee will be elected to the Board. In
addition, Employee will be nominated by the Board to stand for election as a
member of the Board at the meeting of the shareholders of HME to be held in
2001, 2002 and 2003. Employee shall devote substantially all of his business
time to the interests and business of the Company, HME and their subsidiaries
and affiliates, except during customary vacation periods of four weeks per
year, periods of illness and other absences beyond his control.
3. Compensation, Benefits and Expenses.
3.1 Base Salary and Bonus. During the period from the Commencement Date
through the term of this Agreement, the Company shall pay to Employee the Base
Salary described below. The Base Salary shall be paid in equal installments
pursuant to the Company's standard payroll policies and shall be subject to
such withholding or deductions as may be mutually agreed between the Company
and Employee or required by law. For the period from the Commencement Date
through December 31, 2001, the "Base Salary" shall be at the annual rate of
$300,000 per year, for calendar year 2002 the Base Salary shall be $350,000 and
for calendar year 2003 the Base Salary shall be $400,000.
3.2 Incentive Compensation. Employee shall receive incentive compensation
pursuant to the Company's Incentive Compensation Plan as such plan may be
amended from time to time. For services rendered in the calendar year 2001,
the Employee shall have the factor of 10% applied to his Base Salary for
purposes of determining his shares of the bonus pool under the Incentive
Compensation Plan. Such factor shall increase to 11% for the calendar year 2002
and to 12% for the calendar year 2003. One-half of the bonus shall be non-
discretionary and the other half shall be payable to the Employee in the
discretion of the Management and Directors Committee of the Board of Directors
of HME. A description of the current Incentive Compensation Plan is attached
as Exhibit A. The above is subject to modification upon the agreement of the
Employee and the Management and Directors Committee without further need to
modify this Agreement.
The Management and Directors Committee of the Board at its next regularly
scheduled meeting (February 7, 2001) will approve the award of and on that date
HME shall award to Employee, under the terms of HME's 2000 Stock Benefit Plan
(the "Plan"), options to purchase 100,000 shares of HME's common stock (the
"Common Stock") at a per share price equal to the closing price of a share of
HME's Common Stock on the New York Stock Exchange on the date of issuance.
These options will be exercisable at any time within ten years and will be
fully vested upon grant. On the date of HME's regular quarterly meeting of its
Board of Directors held in each of August 2001 and August 2002, the Management
and Directors Committee of the Board will approve the award of and on those
dates HME shall award to the Employee options to purchase an additional 50,000
shares of Common Stock at a per share price equal to the closing price on the
date of the meetings. Such options will be exercisable at any time within ten
years of the date of grant and will vest as follows:
(a) August 2001 options will vest 25,000 on the anniversary date in
August 2002 and 25,000 on the anniversary date in August 2002; and
(b) August 2002 options will vest 25,000 on the anniversary date in
August 2003 and 25,000 on the anniversary date in August 2004.
The options to be granted will be incentive stock options up to the limit
permitted by the Internal Revenue Code with the balance to be non-qualified
stock options. A copy of HME's 2000 Stock Benefit Plan is attached as EXHIBIT
B.
3.3 Fringe Benefits. During the period of his employment, Company shall
provide Employee with such fringe benefits as shall be determined by the
Management and Directors Committee of the Board of Directors of HME; provided,
such fringe benefits shall be no less favorable than those provided to other
senior executives of HME.
3.4 Expenses. During the term of this Agreement, the Company authorizes
Employee to incur reasonable and necessary expenses in the course of performing
his duties and rendering services hereunder, and the Company shall reimburse
Employee for all such expenses within thirty (30) days after Employee renders
to the Company an account of such expenses and such other substantiation as the
Company may reasonably request.
4. Termination.
4.1 Termination. This Agreement may be terminated by the Company at any time
with or without "Cause" or by Employee at any time with or without "Good
Reason".
4.2 Definition of Cause. As used herein, "Cause" shall mean: (a) acceptance
by Employee of employment (full or part-time) with, performance by Employee as
a consultant to or agent of, or receipt by Employee of any direct or indirect
remuneration for services performed for, any other for profit business entity
whether or not competitive with the Company, without the prior approval of the
Board of Directors of HME; (b) dishonest or fraudulent actions by Employee in
the conduct of his duties for the Company or the conviction of Employee of a
felony; (c) death of Employee; (d) failure by Employee to devote substantially
all of his business time to the business of the Company in accordance with
paragraph 2 hereof; or (e) physical or mental disability of Employee that
prevents him from performing his duties for 90 consecutive days or for an
aggregate of 180 days in any twelve-month period.
4.3 Definition of Good Reason. As used herein, "Good Reason" shall mean: (a)
fraudulent conduct by the Company or HME in which Employee is not a participant
and that is not promptly cured by the Company or the General Partner after
notice; or (b) a material breach of this Agreement by the Company or HME that
is not promptly cured after notice; or (c) any requirement by the Company that
Employee relocate to a principal place of business outside of the Rochester,
New York metropolitan area.
4.4 Termination for Cause or without Good Reason. In the event that: (a) the
Company terminates this Agreement for Cause; or (b) Employee resigns or
terminates without Good Reason, then, in any such event, Employee's rights to
receive any payments and benefits pursuant to this Agreement shall, effective
upon the date of termination or expiration of his employment, terminate in all
respects, except that the Company shall pay to Employee any payments and
benefits hereunder that are accrued and unpaid up to such date, and shall
reimburse Employee for any expenses incurred as of such date pursuant to
paragraph 3.4 hereof.
4.5 Termination without Cause or for Good Reason. In the event that: (a) the
Company terminates this Agreement for any reason other than for Cause; or (b)
Employee resigns or terminates this Agreement for Good Reason, then, in any
such event, the Company shall pay to Employee: (i) any payments and benefits
hereunder that are accrued and unpaid up to, and shall reimburse Employee for
any expenses incurred pursuant to paragraph 3.4 hereof prior to, the date of
termination or expiration; and (ii) within ten business days after termination
of his employment, a lump sum equal to the greater of two or the number of full
years remaining in the Term multiplied by Employee's Base Salary as of the date
of termination and the same number of years multiplied by the incentive
compensation determined in accordance with Paragraph 3.2 for services rendered
in the year preceding the date of termination of employment. In the event that
the termination occurs before the amount of the incentive compensation for
services rendered in the year preceding the date of termination have been
finally determined, then the payment to Employee shall be an estimate with an
adjustment to be made promptly upon the determination of the actual amount
pursuant to the Company's Incentive Compensation Plan. In addition to the
above payment, the fringe benefits provided to Employee during the term of this
Agreement pursuant to Section 3.3 hereof shall continue until the earlier to
occur of: (i) the later of (x) 2 years from the termination; and (y) December
31, 2003; and (ii) Employee receives substantially equivalent benefits from a
subsequent employer.
4.6 Executive Retention Plan. Employee will be eligible to participate in the
benefits of HME's Executive Retention Plan, which is attached hereto as Exhibit
C, as such plan may be subsequently amended.
5. Position of Chief Executive Officer. If the Employee is not appointed
Chief Executive Officer of HME on or prior to December 31, 2003 and the
Employee thereafter elects to terminate his employment with the Company on or
before March 31, 2004 or the Company after December 31, 2003 terminates
Employee's employment then the Company shall pay to the Employee within ten
business days after termination of his employment a lump sum equal to $800,000
plus two times the incentive compensation payable to Employee under Section 3.2
for services rendered by the Employee in the year 2003. In the event that the
termination occurs before the amount of the incentive compensation for 2003 has
been finally determined, then the payment to the Employee shall be an estimate
with an adjustment to be made promptly upon the determination of the actual
amount pursuant to the Company's Incentive Compensation Plan. This obligation
will survive the expiration of this Agreement.
6. Stock Loan. Pursuant to its Director, Officer and Employee Stock Purchase
and Loan Plan (the "Loan Plan"), HME will loan Employee sufficient funds to
purchase 50,000 shares of Common Stock at a purchase price equal to 97% of the
Market Price (as defined in the Plan) at an interest rate of 8%. A copy of the
Loan Plan is attached hereto as Exhibit D.
7. Notices. Any notices or other communications under this Agreement shall
be in writing and shall be given by personal delivery or by a nationally
recognized overnight delivery service, and shall be deemed given when
personally delivered, or on the next business day following delivery to a
nationally recognized delivery service:
(I) if to Employee, addressed to:
Xxxxxx X. Xxxxxxxxxx
0 Xxxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
(ii) if to the Company or HME, addressed to:
Home Properties of New York, L.P.
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
or to such other address or addresses as either party shall have specified in
writing to the other party hereto.
8. GOVERNING LAW. ALL QUESTIONS PERTAINING TO THE VALIDITY, CONSTRUCTION,
EXECUTION AND PERFORMANCE OF THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH, AND BE GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE
TO ITS PRINCIPLES OF CONFLICTS OF LAW.
9. Entire Agreement. This Agreement and the benefit plans referred to herein
constitute the entire agreement of the parties hereto with respect to the
matters contained herein, and no modification, amendment or waiver of any of
the provisions of this Agreement shall be effective unless in writing and
signed by each of the parties hereto. No Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
representatives, successors and assigns.
10. Headings. The paragraph and subparagraph headings contained in this
Agreement are for reference purposes only and shall not affect the construction
or interpretation of this Agreement.
11. Counterparts. This Agreement may be executed in several counterparts, and
all counterparts so executed shall constitute one agreement, binding on the
parties hereto, notwithstanding that both parties are not signatory to the
original or the same counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
dates set forth below, effective as of the date first above written.
Date: 1/31/01 HOME PROPERTIES OF NEW YORK, L.P.
By: Home Properties of New York, Inc.
General Partner
By: /s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx, Chairman
HOME PROPERTIES OF NEW YORK, INC.
Date: 1/31/01
By: /s/ Xxxxxx X. Xxxxxxxxx
-------------------------------------------
Xxxxxx X. Xxxxxxxxx, President
Date: 1/31/01 /s/ Xxxxxx X. Xxxxxxxxxx
------------------------------------------------
Xxxxxx X. Xxxxxxxxxx
AMENDMENT NO. ONE
TO EMPLOYMENT AGREEMENT
This Amendment No. One is dated as of February 15, 2001 and amends the
Employment Agreement entered into on January 31, 2001 among Home Properties of
New York, L.P., Home Properties of New York, Inc. and Xxxxxx X. Xxxxxxxxxx
("Employee").
The parties hereto agree that paragraph 6 of the above referenced Employment
Agreement is hereby amended to provide that the loan to be made to Employee
shall be in an amount sufficient to purchase 75,000 shares of Common Stock
rather than 50,000 shares. As amended hereby, the Employment Agreement remains
in full force and effect.
HOME PROPERTIES OF NEW YORK, L.P.
By: Home Properties of New York, Inc. , General Partner
By: /s/ Xxxxxx X. Xxxxxxxxx
Title: President
HOME PROPERTIES OF NEW YORK, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
Title: President
/s/ Xxxxxx X. Xxxxxxxxxx
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Xxxxxx X. Xxxxxxxxxx
