SEVERANCE BENEFITS AGREEMENT
AGREEMENT,
dated as of August 17, 2005, by and among GLIMCHER REALTY TRUST, a Maryland
real
estate investment trust, with offices at ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇ (“GRT”), GLIMCHER PROPERTIES LIMITED PARTNERSHIP, a Delaware limited
partnership, with offices at ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ (“GPLP”),
and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the “Executive”).
WHEREAS,
GRT, GPLP and/or their subsidiaries and affiliates, including entities in which
GRT or GPLP own a majority of any non-voting stock (collectively, the
“Company”), have employed, or may employ in the future, the Executive as an
employee of the Company to perform certain services for and on behalf of the
Company upon terms and conditions upon which the Company and the Executive
have
previously agreed, or may in the future agree (the “Services”);
WHEREAS,
the Company recognizes that the Executive’s contributions to the future growth
of the Company will be substantial; and
WHEREAS,
to induce the Executive to remain in the employ of the Company, the parties
hereto desire to set forth certain severance benefits which GPLP will pay to
the
Executive in the event of a Change in Control of GRT (as defined in Section
2
hereof).
IT
IS
AGREED:
1. TERM.
This
Agreement shall commence on the date hereof and shall terminate upon the earlier
of (a) the date on which GPLP and GRT have satisfied all of their obligations
hereunder or (b) the date on which the Executive is no longer an employee of
the
Company for any reason whatsoever including, without limitation, termination
without cause. Notwithstanding the termination of this Agreement subsequent
to a
Change in Control of GRT, in the event that the Executive is an employee of
the
Company at the moment immediately prior to a Change in Control of GRT, the
Executive shall be entitled to receive all benefits described hereunder and
the
provisions hereof related thereto shall survive such termination.
2. CHANGE
IN CONTROL OF GRT.
For
purposes of this Agreement, a “Change in Control of GRT” shall be deemed to
occur if:
(i) there
shall have occurred a change in control of a nature that would be required
to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as
in effect on the date hereof, whether or not GRT is then subject to such
reporting requirement; provided,
however,
that
there shall not be deemed to be a Change in Control of GRT if immediately prior
to the occurrence of what would otherwise be a Change in Control of GRT (a)
the
Executive is the other party to the transaction (a “Control of GRT Event”) that
would otherwise result in a Change in Control of GRT or
(b) the
Executive is an executive officer, trustee, director or more than 5% equity
holder of the other party to the Control of GRT Event or of any entity, directly
or indirectly, controlling such other party;
(ii) GRT
merges or consolidates with, or sells all or substantially all of its assets
to,
another company (each, a “Transaction”); provided,
however,
that a
Transaction shall not be deemed to result in a Change in Control of GRT if
(a)
immediately prior thereto the circumstances in (i)(a) or (i)(b) above exist
or
(b) (1) the shareholders of GRT, immediately before such transaction, own,
directly or indirectly, immediately following such Transaction in excess of
fifty percent (50%) of the combined voting power of the outstanding voting
securities of the corporation or other entity resulting from such Transaction
(the “Surviving Corporation”) in substantially the same proportion as their
ownership of the voting securities of GRT immediately before such Transaction
and (2) the individuals who were members of GRT’s Board of Trustees immediately
prior to the execution of the agreement providing for such Transaction
constitute at least a majority of the members of the board of directors or
the
board of trustees, as the case may be, of the Surviving Corporation, or of
a
corporation or other entity beneficially, directly or indirectly, owning a
majority of the outstanding voting securities of the Surviving Corporation;
or
(iii) GRT
acquires assets of another company or a subsidiary of GRT merges or consolidates
with another company (each an “Other Transaction”) and (a) the shareholders of
GRT, immediately before such Other Transaction own, directly of indirectly,
immediately following such Other Transaction fifty percent (50%) or less of
the
combined voting power of the outstanding voting securities of the corporation
or
other entity resulting from such Other Transaction (the “Other Surviving
Corporation”) in substantially the same proportion as their ownership of the
voting securities of GRT immediately before such Other Transaction or (b) the
individuals who were members of GRT’s Board of Trustees immediately prior to the
execution of the agreement providing for such Other Transaction constitute
less
than a majority of the members of the board of directors or board of trustees,
as the case may be, of the Other Surviving Corporation, or of a corporation
or
other entity beneficially, directly or indirectly, owing a majority of the
outstanding voting securities of the Other Surviving Corporation; provided,
however,
that an
Other Transaction shall not be deemed to result in a Change in Control of GRT
if
immediately prior thereto the circumstances in (i)(a) or (i)(b) above
exist.
3. COMPENSATION
UPON A CHANGE IN CONTROL OF GRT.
If the
Executive is an employee of the Company at the moment immediately prior to
a
Change in Control of GRT, the Executive shall be entitled to receive the
compensation and benefits set forth below.
(a) GPLP
shall pay to the Executive, not later than the date of any Change in Control
of
GRT, unless otherwise agreed to in writing, a lump sum severance payment (the
“Severance Payment”) equal to two (2) times the Base Amount (as defined below).
For purposes of the Section 3(a), the Base Amount shall mean the Executive’s
annual compensation during the calendar year period preceding the calendar
year
in which the Change in Control of GRT occurs. For purposes of determining annual
compensation in this Section 3(a), there shall be included (i) all base salary
and bonuses paid or payable to the Executive by the Company with respect to
the
preceding calendar year; (ii) all grants of restricted common shares of
beneficial interest of GRT (the “Shares”), if any, with respect to such
preceding calendar year, which Shares shall be valued based on their date of
grant at the then Fair Market Value (as defined in Section of 2.15 of GRT’s 2004
Incentive Compensation Plan or any other plan or agreement pursuant to which
they are issued) and (iii) the fair market value of any other property or rights
given or awarded to the Executive by the Company with respect to such preceding
calendar year, or partial first year of employment.
(b) Any
Shares now or hereafter issued to the Executive pursuant to any restricted
Share
grant shall vest on the day immediately prior to the date of a Change in Control
of GRT and no longer be subject to repurchase or any other forfeiture
restrictions.
(c) GRT
and
GPLP shall cause the Company to maintain in full force and effect for the
Executive’s continued benefit for eighteen (18) months following a Change in
Control of GRT, all life, accident, medical and dental insurance benefit plans
and programs or arrangements in which the Executive was entitled to participate
immediately prior to the date of a Change in Control of GRT, provided that
the
Executive’s continued participation is allowable under the general terms and
provisions of such plans and programs and provided, further, that in the event
that the Executive becomes employed by any third party during such 18-month
period, then upon the date of such employment the Executive shall no longer
be
entitled to any accident, medical or dental insurance benefits described in
the
preceding clause. Subject to the preceding sentence, in the event that the
Executive’s participation in any such plan or program is barred, GRT and GPLP
shall arrange to cause the Company to provide the Executive with benefits
substantially similar to those which the Executive was entitled to receive
under
such plans and programs. Subject to the first sentence of this paragraph, at
the
end of the period of coverage, the Executive shall have the option to have
assigned to him at no cost to the Executive and with no apportionment of prepaid
premiums, any assignable insurance policy owned by the Company and relating
specifically to the Executive.
(d) All
options to purchase Shares now or hereafter granted to the Executive shall
vest
on the day immediately prior to the date of a Change in Control of GRT and
become fully exercisable in accordance with their terms.
(e) The
Executive shall not be required to mitigate the amount of any payment provided
for in this Section 3 by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this Section 3 be reduced
by
any compensation earned by him as the result of employment by another employer
or by retirement benefits after the date of termination, or otherwise, except
as
specifically provided in this Section 3.
4. ADDITIONAL
AMOUNT.
Whether
or not Section 3 hereof is applicable, if in the opinion of tax counsel selected
by the Executive and reasonably acceptable to the Company, the Executive has
or
will receive any compensation or recognize any income (whether or not pursuant
to this Agreement or any plan or other arrangement of the Company and whether
or
not the Executive’s employment with the Company has terminated) which
constitutes an “excess of parachute payment” within the meaning of Section
280G(b)(1) of the Internal Revenue Code of 1986, as amended (the “Code”) (or for
which a tax is otherwise payable under Section 4999 of the Code), then GPLP
shall pay the Executive an additional amount (the “Additional Amount”) equal to
the sum of (i) all taxes payable by the Executive under Section 4999 of the
Code
with respect to all such excess parachute payments (or otherwise) including,
without limitation, the Additional Amount, plus (ii) all Federal, state and
local income taxes for which the Executive may be liable with respect to the
Additional Amount. The amounts payable pursuant to this Section 4 shall be
paid
by GPLP to the Executive not later than the date of any Change in Control of
GRT, unless otherwise agreed to in writing.
5. EXPENSES.
GPLP
shall pay or reimburse the Executive, as the case may be, for all legal fees
and
related expenses (including the costs of experts, evidence and counsel) paid
by
the Executive as a result of (i) the Executive seeking to obtain or enforce
any
right or benefit provided by this Agreement or (ii) any action taken by the
Company against the Executive in enforcing its rights hereunder; provided,
however, that GPLP shall reimburse the legal fees and related expenses described
in Section 5 only if and when a final judgment has been rendered in favor of
the
Executive and all appeals related to any such action have been
exhausted.
6. NO
EMPLOYMENT RIGHTS OR OBLIGATIONS.
Nothing
contained herein shall confer upon the Executive the right to continue in the
employment or service of the Company or affect any right that the Company may
have to terminate the employment or service of the Executive at any time for
any
reason.
7. GRT
GUARANTY.
GRT
guarantees the satisfaction of all obligations of, and the full and prompt
payment of all amounts payable by GPLP hereunder. In addition, GRT guarantees
the satisfaction of all obligations of the Company hereunder.
8. GOVERNING
LAW; ARBITRATION.
This
Agreement shall be governed by and construed in accordance with the internal
laws of the State of Maryland, without regard to Maryland’s conflicts of law
principles. Any dispute or controversy arising under this Agreement, or out
of
the interpretation hereof, or based upon the breach hereof, shall be resolved
by
arbitration held at the offices of the American Arbitration Association in
The
Commonwealth of Pennsylvania, in the City of Philadelphia, in accordance with
the rules and regulations of such association prevailing at the time of the
demand for arbitration by either party hereto; provided, however, that the
arbitrator or arbitrators shall only have the power and authority to interpret,
and not modify or amend, the terms and provisions hereof. Judgment upon an
award
rendered by the arbitrator or arbitrators may be entered in any court having
jurisdiction thereof. Notwithstanding anything contained in this Section 8,
either party shall have the right to seek preliminary injunctive relief in
any
court in the City of Philadelphia in aid of (and pending the final decision)
the
arbitration proceeding.
9. ENTIRE
AGREEMENT.
This
Agreement sets forth the entire agreement of the parties and is intended to
supersede all prior negotiations, understandings and agreements with respect
to
the subject matter hereof. No provision of this Agreement may be waived or
changed, except by a writing signed by the party to be charged with such waiver
or change.
10. SUCCESSORS;
BINDING AGREEMENT.
This
shall inure to the benefit of, be binding upon and enforceable by GRT and GPLP,
their successors and assigns, and the Executive and the Executive’s personal or
legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
11. NOTICES.
All
notices provided for in this Agreement shall be in writing, and shall be deemed
to have been duly given when delivered personally to the party to receive the
same, when given by telex, telegram or mailgram, or when mailed first class
postage prepaid, by registered or certified mail, return receipt requested,
addressed to the party to receive the same. All notices shall be deemed to
have
been given as of the date of personal delivery, transmittal or mailing
thereof.
12. SEVERABILITY.
If any
provision in this Agreement is determined to be invalid, it shall not affect
the
validity or enforceability of any of the other remaining provisions
hereof.
13. GRT
EXCULPATION.
This
Agreement and all documents, agreements, understandings and arrangements
relating to the matters described herein have been executed by the undersigned
representative of GRT in his/her capacity as an officer or trustee of GRT which
has been formed as a Maryland real estate investment trust pursuant to the
Amended and Restated Declaration of Trust of GRT, as amended, and not
individually, and neither the trustees, officers or shareholders of GRT shall
be
bound or have any personal liability hereunder or thereunder. The Executive
shall look solely to the assets of GRT for satisfaction of any liability of
GRT
in respect to this Agreement and all documents, agreements, understandings
and
arrangements relating to this transaction and will not seek recourse or commence
any action against any of the trustees, officers or shareholders or GRT or
any
of their personal assets for the performance or payment of any obligation
hereunder or thereunder. The foregoing shall also apply to any future documents,
agreements, understandings, arrangements and transactions between the parties
hereto.
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date
first above written.
By:
/s/
▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, President & Chief Executive
Officer
GLIMCHER
PROPERTIES LIMITED PARTNERSHIP
BY:
GLIMCHER PROPERTIES CORPORATION, its General
Partner
By:
/s/
▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, President & Chief Executive
Officer
EXECUTIVE:
/s/
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▇.
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