1
EXHIBIT 99.8
▇▇▇▇▇ ▇. ▇▇▇▇
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement"), is made and entered into
as of the 16th day of November, 1998 (the "Effective Date"), by and between
Wellington Properties Trust, a Maryland real estate investment trust (the
"Employer"), and ▇▇▇▇▇ ▇. ▇▇▇▇ (the "Executive").
RECITALS
A. The Employer desires to employ the Executive as an officer of the
Employer for a specified term.
B. The Executive is willing to accept such employment, upon the terms
and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements hereinafter contained, it is covenanted and agreed by and between
the parties hereto as follows:
AGREEMENTS
1. POSITION AND DUTIES. The Employer hereby employs the Executive as
Chief Executive Officer of the Employer, or in such other comparable or other
capacity as shall be mutually agreed between the Employer and the Executive.
During the period of the Executive's employment hereunder, the Executive shall
devote his best efforts and full working time, energy, skills and attention to
the business and affairs of the Employer, on an exclusive basis. The Executive's
duties and authority shall consist of and include all duties and authority
customarily performed and held by persons holding equivalent positions with real
estate investment trusts ("REIT's") similar in nature and size to the Employer,
as such duties and authority are reasonably defined, modified and delegated from
time to time by the Board of Directors of the Employer (the "Board"). The
Executive shall have the powers necessary to perform the duties assigned to him,
and shall be provided such supporting services, staff, secretarial and other
assistance, office space and accouterments as shall be reasonably necessary and
appropriate in light of such assigned duties.
2. COMPENSATION. As compensation for the services to be provided by the
Executive hereunder, the Executive shall receive the following compensation and
other benefits:
(a) BASE SALARY. The Executive shall receive an aggregate annual
minimum "Base Salary" at the rate of One Hundred and Fifty Thousand dollars
($150,000) per annum, payable in periodic installments in accordance with the
regular payroll practices of the Employer. Such Base Salary shall, during the
term hereof, be subject to review annually by the Compensation Committee of the
Board of Directors of the Employer (the "Board") to
2
determine appropriate adjustments, if any, in Base Salary, in accordance with
the Employer's compensation policies, as they may be established from time to
time.
(b) PERFORMANCE BONUS. The Executive shall receive an annual cash
"Performance Bonus," of up to a maximum of two hundred percent (200%) of the
Executive's Base Salary for such fiscal year payable within thirty (30) days
after the end of the fiscal year of the Employer, which shall be based upon
company-wide and individual performance criteria mutually agreed upon from time
to time by the Executive and the Board, and which shall be determined by the
Board based upon the recommendation of the Compensation Committee of the Board.
(c) BENEFITS. The Executive shall be entitled to all perquisites,
plans and benefits extended to similarly situated executives, including as such
are stated in the Employer's Executive Perquisite Policy (the "Perquisite
Policy") promulgated for the Board by the Compensation Committee of the Board,
and which Perquisite Policy is hereby incorporated by reference, as amended from
time to time. In addition, the Executive shall be entitled to participate in all
plans and benefits generally, from time to time, accorded to employees of the
Employer ("Benefit Plans"), all as determined by the Board from time to time
based upon the input of its Compensation Committee.
(d) WITHHOLDING. The Employer shall be entitled to withhold, from
amounts payable to the Executive hereunder, any federal, state or local
withholding or other taxes or charges which, from time to time, it is required
to withhold. The Employer shall be entitled to rely upon the advice and counsel
of its independent accountants with regard to any question concerning the amount
or requirement of any such withholding.
3. TERM AND TERMINATION.
(a) TERM. The term of this Agreement and the Executive's employment
hereunder shall be three (3) years, commencing as of the Effective Date. This
Agreement and the term of the Executive's employment hereunder will
automatically renew for one (1) additional year on each anniversary of the
Effective Date, unless sooner terminated at any time by either party, with or
without cause, such termination to be effective as of either (i) one (1)
business day after written notice to that effect is delivered by the Employer to
the Executive [except as and to the extent otherwise required under
subparagraphs (e) and (g) of this Section 3]; or (ii) thirty (30) days after
written notice to that effect is delivered to the Employer by the Executive,
whichever is applicable to the termination in question.
(b) VOLUNTARY TERMINATION BY EXECUTIVE. In the event that the
Executive voluntarily terminates his employment under this Agreement, other than
pursuant to Section 3(d) of this Agreement, then the Employer shall only be
required to pay the Executive such Base Salary and other benefits as shall have
accrued through the effective date of the termination, and the Employer shall
not be obligated to pay any Performance Bonus for the then-current (or any
prior) fiscal year, or have any further obligations whatsoever to the
2
3
Executive (other than payment of amounts remaining unpaid pursuant to declared
Performance Bonuses for prior fiscal years and reimbursement of previously
approved expenses).
(c) PREMATURE TERMINATION BY EMPLOYER.
(i) In the event of the termination of the employment of the
Executive under this Agreement: (A) by the Employer for any reason other
than in accordance with the provisions of subparagraph (e) ("for cause"),
subparagraph (f) (death), or subparagraph (g) (disability) of this Section
3, then notwithstanding any actual or allegedly available alternative
employment or other mitigation of damages by (or which may be available to)
the Executive, the Executive shall be entitled to a "Lump Sum Payment"
equal to the sum of: (w) his monthly Base Salary then payable, multiplied
by thirty-six (36); plus (x) three (3) times the average of the two (2)
most recent annual Performance Bonuses that the Executive received from the
Employer; plus (y) the monthly average of the two (2) most recent annual
Performance Bonuses that the Executive received from the Employer,
multiplied by the number of full calendar months the Executive was employed
during the then-current fiscal year of the Employer. In the event of a
termination governed by this subparagraph (c)(i) of Section 3, the Employer
shall also: (z) continue for the Executive (provided that such items are
not available to him by virtue of other employment secured after
termination) the perquisites, plans and benefits provided under the
Employer's Perquisite Policy and Benefit Plans as of and after the date of
termination, provided such plans or benefits permit such continuation, [all
items in (z) being collectively referred to as "Post-Termination
Perquisites and Benefits"], for thirty-six (36) months following such
termination. The payments and benefits provided under (x), (y), and (z)
above shall be in addition to such Base Salary as shall have accrued and
remain unpaid as well as any expense reimbursements or other payments
relating to the period preceding such termination and remaining due and
owing to the Executive but shall (aa) be in lieu of any Performance Bonus
that the Executive might have otherwise earned for the then-current fiscal
year; and (bb) be in addition to the payment of any theretofore declared
Performance Bonus compensation for any prior fiscal year that remains
unpaid as of the date of termination.
(ii) Payment to the Executive under this Section 3(c) will be made
in a lump sum.
(d) CONSTRUCTIVE DISCHARGE. If at any time during the term of this
Agreement, except in connection with a "for cause" termination pursuant to
subparagraph (e) of this Section 3 or the Executive's death or disability
termination pursuant to subparagraphs (f) and (g) respectively of this Section
3, the Executive is Constructively Discharged (as hereinafter defined), then the
Executive shall have the right, by written notice to the Employer given within
one hundred and twenty (120) days of such Constructive Discharge, to terminate
his services hereunder, effective as of thirty (30) days after such notice, and
the Executive shall have no further rights or obligations under this Agreement
except as specified in Section 5 hereof. The Executive shall in such event be
entitled to a Lump Sum Payment of his Base Salary and Performance Bonus
compensation, as well as, all of the Post-Termination
3
4
Perquisites and Benefits, as if such termination of his employment had been
effectuated pursuant to subparagraph (c) of this Section 3 and subject to all of
the conditions set forth in subparagraph (c) of this Section 3.
For purposes of this Agreement, the Executive shall be deemed to have been
"Constructively Discharged" upon the occurrence of any one of the following
events:
(i) The Executive is removed from the position with
the Employer set forth in Section 1 hereof, other than as a result of
the Executive's appointment to a position of comparable or superior
authority and responsibility, or other than for cause, and provided
further, that the Employer shall be permitted to broaden and expand the
Executive's responsibilities, whether in the same or different position
without such change constituting a "Constructive Discharge" hereunder;
(ii) The Executive shall fail to be vested by the
Employer with the powers, authority and support services customarily
attendant to said office within the REIT industry, other than for
cause;
(iii) The Employer shall formally notify the
Executive, in writing, that the employment of the Executive will be
terminated (other than for cause) or materially modified (other than
for cause) in the future, or that the Executive will be Constructively
Discharged in the future; or
(iv) The Employer changes the primary employment
location of the Executive to a place that is more than one hundred
(100) miles from the primary employment location as of the Effective
Date of this Agreement, other than in connection with a general
relocation of the headquarters office (or staff) of the Employer; or
(v) The Employer commits a material breach of its
obligations under this Agreement, which it fails to cure or commence to
cure within thirty (30) days after receipt of written notice thereof
from the Executive (or if cure is not possible within such thirty (30)
days, then the Employer must have failed to either commence to cure
within thirty (30) days or have failed to complete to cure within sixty
(60) days).
(e) TERMINATION FOR CAUSE. The employment of the Executive under
this Agreement may be terminated by the Employer on a "for cause" basis, as
hereinafter defined. If the Executive's employment is terminated by the Employer
"for cause" under this subparagraph (e), then the Employer shall only be
obligated to pay the Executive such Base Salary as shall have accrued through
the effective date of the termination, and the Employer shall not be required to
pay the Executive any Performance Bonus for the current fiscal year, or have any
further obligations whatsoever to the Executive (other than payment of amounts
remaining unpaid pursuant to declared Performance Bonuses for prior fiscal years
and reimbursement for previously approved expenses). Termination "for cause"
shall mean the termination of Executive's employment on the basis of, or as a
result of, one or more of the following circumstances: (i) a violation by the
Executive of any applicable material law or
4
5
regulation respecting the business of the Employer; (ii) the Executive being
found guilty of, or being publicly associated with, a felony or an act of
dishonesty or an act of willful or reckless behavior in connection with the
performance of his duties as an officer of the Employer, or otherwise; or (iii)
the Executive's course of conduct constituting the willful or negligent failure
of the Executive to perform his duties hereunder and which is, or may result in
a material detriment to the Company as reasonably determined by the Board. The
Executive shall be entitled to thirty (30) days' prior written notice (the
"Termination Notice") of the Employer's intention to terminate his employment
for cause and such Termination Notice shall: specify the grounds for such
termination; afford the Executive a reasonable opportunity to cure any conduct
or act (if curable) alleged as grounds for such termination; and, afford the
Executive a reasonable opportunity to present to the Board his position
regarding any dispute relating to the existence of such cause. Notwithstanding
the foregoing procedure, the Employer (through the Board) shall have the
unilateral right to make the final substantive determination as to whether the
Executive has properly remedied or otherwise addressed those matters described
in the Termination Notice as grounds for termination of the Executive's
employment; and in the event that the Employer determines (as of the expiration
of the above-contemplated 30-day period), that the Executive has not
appropriately remedied or otherwise addressed those matters, then the
Executive's term of employment shall in all events automatically terminate as of
the thirtieth (30th) day after the Employer delivers the Termination Notice,
without any responsibility of obligation of the Employer to provide the
Executive with any further notice or explanation of the grounds for his
termination.
(f) PAYMENTS UPON DEATH. This Agreement shall terminate upon the
death of the Executive. Upon the Executive's death and the termination of the
Agreement the Employer shall only be obligated to pay: (i) such Base Salary as
shall have accrued through the date of death; plus (ii) one-half (1/2) of the
monthly average of the two (2) most recent annual Performance Bonuses that the
Executive received from the Employer multiplied by the number of full calendar
months the Executive was employed during the then-current fiscal year of the
Employer, and the Employer shall not have any further obligations to the
Executive (other than payment of amounts remaining unpaid pursuant to declared
Performance Bonuses for prior fiscal years and reimbursement of previously
approved expenses). The amount the Employer shall be obligated to pay upon the
Executive's death shall be made to such beneficiary, designee or fiduciary as
Executive may have designated in writing or, failing such designation, to the
executor or administrator of his estate, in full settlement and satisfaction of
all claims and demands on behalf of the Executive. Such payments shall be in
addition to any other death benefits of the Employer made available for the
benefit of the Executive, and in full settlement and satisfaction of all
payments provided for in this Agreement.
(g) DISABILITY DETERMINATION. The Employer may deliver a Termination
Notice, except that the subject thereof shall be the Executive's "disability,"
and terminate the Executive's employment if the Executive is determined to be
"disabled," which term shall mean the Executive's inability, as a result of
physical or mental incapacity, substantially to perform his duties hereunder for
a period of either six (6) consecutive months, or one hundred and twenty (120)
business days within a consecutive twelve (12) month period. In the event of a
dispute regarding the Executive's "disability," such dispute shall be resolved
through
5
6
arbitration as provided in subparagraph (d) of Section 9 hereof, except that the
arbitrator appointed by the American Arbitration Association shall be a duly
licensed medical doctor. The Executive shall be entitled to the compensation and
benefits provided under this Agreement during any period of incapacitation
occurring during the term of this Agreement prior to the establishment of
Executive's "disability" and subsequent termination of his employment. Upon the
Executive's termination of employment under this Section 3(g), the Employer
shall only be obligated to pay the Executive: (i) such Base Salary as shall have
accrued through the effective date of termination; plus (ii) one-half (1/2) of
the average of the two (2) most recent annual Performance Bonuses that the
Executive received from the Employer multiplied by the number of full calendar
months the Executive was employed during the then-current fiscal year of the
Employer, and the Employer shall not have any further obligations to the
Executive (other than payment of amounts remaining unpaid pursuant to declared
Performance Bonuses for prior fiscal years and reimbursement of previously
approved expenses).
(h) TERMINATION UPON CHANGE IN CONTROL.
(i) In the event of a Change in Control (as defined below) of the
Employer and the termination of the Executive's employment by Executive or by
the Employer under either 1 or 2 below in connection therewith ("Change in
Control Termination"), the Executive shall be entitled to the Severance Amount
determined under subparagraph (c) of this Section 3. The following shall
constitute Change in Control Termination under this subparagraph (g):
1. The Executive terminates his employment under this
Agreement pursuant to a written notice to that effect
delivered to the Board within sixty (60) days after
the occurrence of the event constituting a Change in
Control.
2. Executive's employment is terminated (other than for
cause or death or disability), but including
Constructive Discharge, by the Employer or its
successor, either within one (1) year prior to or
following the event constituting a Change in Control.
(ii) For purposes of this subparagraph, the term
"Change in Control" shall mean the approval by the shareholders
of the Employer of: (1) a merger or consolidation of the
Employer, if the shareholders of the Employer immediately before
such merger or consolidation do not, as a result of such merger
or consolidation, own, directly or indirectly, more than fifty
percent (50%) of the combined voting power of the then
outstanding voting securities of the entity resulting from such
merger or consolidation in substantially the same proportion as
was represented by their ownership of the combined voting power
of the voting securities of the Employer outstanding immediately
before such merger or consolidation; (2) a complete or
substantial liquidation or dissolution, or an agreement for the
sale or other disposition, of all or substantially all
6
7
of the assets of the Employer; or (3) a complete or substantial
liquidation or dissolution or an agreement for the sale or other
disposition of its general partnership interests in Wellington
Properties Investments, L.P.
Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because forty percent (40%) or more of the combined
voting power of the then-outstanding securities is acquired by: (1) a
trustee or other fiduciary holding securities under one or more employee
benefit plans maintained for employees of the entity; or (2) any
corporation or other entity which, immediately prior to such acquisition,
is substantially owned directly or indirectly by the stockholders of the
Employer in the same proportion as their ownership of stock in the Employer
immediately prior to such acquisition.
(iii) If it is determined, in the opinion of the Employer's
independent accountants, in consultation with the Employer's independent
counsel, that any amount payable to the Executive by the Employer under this
Agreement, or any other plan or agreement under which the Executive participates
or is a party, would constitute an "Excess Parachute Payment" within the meaning
of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code")
and be subject to the excise tax imposed by Section 4999 of the Code (the
"Excise Tax"), the Employer shall pay to the Executive a "grossing-up" amount
equal to the amount of such Excise Tax and all federal and state income or other
taxes with respect to the payment of the amount of such Excise Tax, including
all such taxes with respect to any such grossing-up amount. If at a later date,
the Internal Revenue Service assesses a deficiency against the Executive for the
Excise Tax which is greater than that which was determined at the time such
amounts were paid, the Employer shall pay to the Executive the amount of such
unreimbursed Excise Tax plus any interest, penalties and professional fees or
expenses, incurred by the Executive as a result of such assessment, including
all such taxes with respect to any such additional amount. The highest marginal
tax rate applicable to individuals at the time of payment of such amounts will
be used for purposes of determining the federal and state income and other taxes
with respect thereto. The Employer shall withhold from any amounts paid under
this Agreement the amount of any Excise Tax or other federal, state or local
taxes then required to be withheld. Computations of the amount of any
grossing-up supplemental compensation paid under this subparagraph shall be made
by the Employer's independent accountants, in consultation with the Employer's
independent legal counsel. The Employer shall pay all accountant and legal
counsel fees and expenses.
4. CONFIDENTIALITY AND LOYALTY. The Executive acknowledges that during the
course of his employment prior to his entry into this Agreement, he has
produced, received and had access to, and may hereafter continue to produce,
receive and otherwise have access to various materials, records, data, trade
secrets and information not generally available to the public (collectively,
"Confidential Information") regarding the Employer and its subsidiaries and
affiliates. Accordingly, during and subsequent to any termination of this
Agreement, on any basis, the Executive shall hold in confidence and shall not
directly or indirectly disclose, use, copy or make lists of any such
Confidential Information, except to the extent that (a) such information is or
thereafter becomes lawfully available from public sources; or (b) such
7
8
disclosure is authorized in writing by the Employer; or (c) such disclosure is
required by law or by any competent administrative agency or judicial authority;
or (d) such disclosure is otherwise reasonably necessary or appropriate in
connection with the performance by the Executive of his duties hereunder. All
records, files, documents, computer diskettes, computer programs and other
computer-generated material, as well as all other materials or copies thereof
relating to the Employer's business, which the Executive shall prepare or use,
shall be and remain the sole property of the Employer, shall not be removed from
the Employer's premises without its written consent, and shall be promptly
returned to the Employer upon termination of the Executive's employment
hereunder. The Executive agrees to abide by the Employer's general policies, as
in effect from time to time, respecting confidentiality and the avoidance of
interests conflicting or appearing to be in conflict with those of the Employer.
5. NON-COMPETITION COVENANT.
(a) RESTRICTIVE COVENANT The Employer and the Executive have jointly
reviewed the tenant lists, property submittals, logs, broker lists, and
operations of the Employer, and have agreed that in consideration of this
Agreement and the payment of the amounts described in Sections 2 and 3 hereof,
the Executive hereby agrees that, except with the express prior written consent
of the Employer, during the term of Executive's employment with the Employer
hereunder (the "Restrictive Period"), he will not directly or indirectly compete
with the business of the Employer, including, but not by way of limitation, by
directly or indirectly violating any duty the Executive owes the Employer under
applicable state law, owning, managing, operating, controlling, financing, or by
directly or indirectly serving as an employee, officer or director of or
consultant to, or by soliciting or inducing, or attempting to solicit or induce,
any employee or agent of Employer to terminate employment with Employer and
become employed by any person, firm, partnership, corporation, trust or other
entity which owns or operates a business similar to that of the Employer (the
"Restrictive Covenant"). For purposes of this subparagraph (a), a business shall
be considered "similar" to that of the Employer if it is engaged in the
ownership, acquisition, development, ownership, operation, management or leasing
of multi-unit residential, commercial or industrial property (i) in any
geographic market or territory in which the Employer owns properties either as
of the date hereof or as of the date of termination of the Executive's
employment; or (ii) in any "Target Market" publicly identified by the Employer;
or (iii) in any market in which an acquisition is pending at the time of the
termination of the Executive's employment. If the Executive violates the
Restrictive Covenant and the Employer brings legal action for injunctive or
other relief, the Employer shall not, as a result of the time involved in
obtaining such relief, be deprived of the benefit of the full period of the
Restrictive Covenant. Accordingly, the Restrictive Covenant shall be deemed to
have the duration specified in this paragraph (a) computed from the date the
relief is granted but reduced by the time between the period when the
Restrictive Period began to run and the date of the first violation of the
Restrictive Covenant by the Executive. In the event that a successor of the
Employer assumes and agrees to perform this Agreement or otherwise acquires the
Employer, this Restrictive Covenant shall continue to apply only to the primary
service area of the Employer as it existed immediately before such assumption or
acquisition and shall not apply to any of the successor's other
8
9
offices or markets. The foregoing Restrictive Covenant shall not prohibit the
Executive from owning, directly or indirectly, capital stock or similar
securities which are listed on a securities exchange or quoted on the National
Association of Securities Dealers Automated Quotation System which do not
represent more than five percent (5%) of the outstanding capital stock of any
corporation.
(b) REMEDIES FOR BREACH OF RESTRICTIVE COVENANT. The Executive
acknowledges that the restrictions contained in Sections 4 and 5 of this
Agreement are reasonable and necessary for the protection of the legitimate
proprietary business interests of the Employer; that any violation of these
restrictions would cause substantial injury to the Employer and such interests;
that the Employer would not have entered into this Agreement with the Executive
without receiving the additional consideration offered by the Executive in
binding himself to these restrictions; and that such restrictions were a
material inducement to the Employer to enter into this Agreement. In the event
of any violation or threatened violation of these restrictions, the Employer
shall be relieved of any further obligations under this Agreement, shall be
entitled to any rights, remedies or damages available at law, in equity or
otherwise under this Agreement, and shall be entitled to preliminary and
temporary injunctive relief granted by a court of competent jurisdiction to
prevent or restrain any such violation by the Executive and any and all persons
directly or indirectly acting for or with him, as the case may be, while
awaiting the decision of the arbitrator selected in accordance with paragraph
(d) of Section 9 of this Agreement, which decision, if rendered adverse to the
Executive, may include permanent injunctive relief to be granted by the court.
6. INTERCORPORATE TRANSFERS. If the Executive shall be transferred by the
Employer to an affiliate of the Employer, such transfer shall not be deemed a
Constructive Termination or otherwise be deemed to terminate or modify this
Agreement, and the employing corporation to which the Executive shall have been
transferred shall, for all purposes of this Agreement, be construed as standing
in the same place and stead as the Employer as of the date of such transfer. For
purposes hereof, an affiliate of the Employer shall mean any corporation or
other entity directly or indirectly controlling, controlled by, or under common
control with the Employer. For all relevant purposes hereof, the tenure of the
Executive shall be deemed to include the aggregate term of his employment by
both the Employer and its affiliate.
7. INTEREST IN ASSETS AND PAYMENTS. Neither the Executive nor his estate
shall acquire any rights in any funds or other assets of the Employer, otherwise
than by and through the actual payment of amounts payable hereunder; nor shall
the Executive or his estate have any power to transfer, assign, anticipate,
pledge, hypothecate or otherwise encumber any of said payments; nor shall any of
such payments be subject to seizure for the payment of any debt, judgment,
alimony, separate maintenance or be transferable by operation of law in the
event or as a result of any bankruptcy, insolvency or other legal proceeding
otherwise relating to the Executive.
9
10
8. INDEMNIFICATION.
(a) The Employer shall provide the Executive (including his heirs,
personal representatives, executors and administrators), during the term of this
Agreement and thereafter throughout all applicable limitations periods, with
coverage under the Employer's then-current directors' and officers' liability
insurance policy, at the Employer's expense.
(b) In addition to the insurance coverage provided for in paragraph (a)
of this Section 8, the Employer shall defend, hold harmless and indemnify the
Executive (and his heirs, executors and administrators) to the fullest extent
permitted under applicable law, and subject to the requirements, limitations and
specifications set forth in the Bylaws and other organizational documents of the
Employer, against all expenses and liabilities reasonably incurred by him in
connection with or arising out of any action, suit or proceeding in which he may
be involved by reason of his having been an officer of the Employer (whether or
not he continues to be an officer at the time of incurring such expenses or
liabilities), such expenses and liabilities to include, but not be limited to,
judgments, court costs and attorneys' fees and the cost of reasonable
settlements.
(c) In the event the Executive becomes a party, or is threatened to be
made a party, to any action, suit or proceeding for which the Employer has
agreed to provide insurance coverage or indemnification under this Section 8,
the Employer shall, to the full extent permitted under applicable law, advance
all expenses (including the reasonable attorneys' fees of the attorneys selected
by Employer and approved by Executive for the representation of the Executive),
judgments, fines and amounts paid in settlement (collectively "Expenses")
incurred by the Executive in connection with the investigation, defense,
settlement, or appeal of any threatened, pending or completed action, suit or
proceeding, subject to receipt by the Employer of a written undertaking from the
Executive covenanting: (i) to reimburse the Employer for all Expenses actually
paid by the Employer to or on behalf of the Executive in the event it shall be
ultimately determined that the Executive is not entitled to indemnification by
the Employer for such Expenses; and (ii) to assign to the Employer all rights of
the Executive to insurance proceeds, under any policy of directors' and
officers' liability insurance or otherwise, to the extent of the amount of
Expenses actually paid by the Employer to or on behalf of the Executive.
9. GENERAL PROVISIONS.
(a) SUCCESSORS; ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the Executive, the Employer, the Executive's personal
representatives, the Employer's successors and assigns, and any successor or
assignee of the Employer shall be deemed the successor to all or substantially
all of the business and/or assets of the Employer, whether directly or
indirectly, by purchase, merger, consolidation, acquisition of stock, or
otherwise, by an agreement in form and substance satisfactory to the Executive,
expressly to assume and agree to perform this Agreement in the same manner and
to the same extent as the Employer would be required to perform if no such
succession had taken place. The Executive may neither assign his duties or
obligations this Agreement, nor sell, assign, pledge,
10
11
encumber, transfer or hypothecate his entitlement hereunder, and the Employer
shall have no obligation to recognize any such purported alienation, or pay any
funds to any party claiming the benefit thereof.
(b) ENTIRE AGREEMENT; MODIFICATIONS. This Agreement constitutes the
entire agreement between the parties respecting the subject matter hereof, and
supersedes all prior negotiations, undertakings, agreements and arrangements
with respect thereto, whether written or oral. Except as otherwise explicitly
provided herein, this Agreement may not be amended or modified except by written
agreement signed by the Executive and the Employer.
(c) ENFORCEMENT AND GOVERNING LAW. The provisions of this Agreement
shall be regarded as divisible and separate; if any of said provisions should be
declared invalid or unenforceable by a court of competent jurisdiction, the
validity and enforceability of the remaining provisions shall not be affected
thereby. This Agreement shall be construed and the legal relations of the
parties hereto shall be determined in accordance with the laws of the State of
Wisconsin as it constitutes the situs of the corporation and the employment
hereunder, without reference to the law regarding conflicts of law.
(d) ARBITRATION. Except as otherwise provided in paragraph (b) of
Section 5, any dispute or controversy arising under or in connection with this
Agreement or the Executive's employment by the Employer shall be settled
exclusively by arbitration, conducted by a single arbitrator sitting in
Milwaukee, Wisconsin, in accordance with the rules of the American Arbitration
Association (the "AAA") then in effect. The arbitrator shall be selected by the
parties from a list of eleven (11) arbitrators provided by the AAA, provided
that no arbitrator shall be related to or affiliated with either of the parties.
No later than ten (10) days after the list of proposed arbitrators is received
by the parties, the parties, or their respective representatives, shall meet at
a mutually convenient location in Chicago, Illinois, or telephonically. At that
meeting, the party who sought arbitration shall eliminate one (1) proposed
arbitrator and then the other party shall eliminate one (1) proposed arbitrator.
The parties shall continue to alternatively eliminate names from the list of
proposed arbitrators in this manner until each party has eliminated five (5)
proposed arbitrators. The remaining arbitrator shall arbitrate the dispute. Each
party shall submit, in writing, the specific requested action or decision it
wishes to take, or make, with respect to the matter in dispute ("Proposed
Solution"), and the arbitrator shall be obligated to choose one (1) party's
specific Proposed Solution, without being permitted to effectuate any compromise
or "new" position; provided, however, that the arbitrator is authorized to award
amounts not in dispute during the pendency of any dispute or controversy arising
under or in connection with this Agreement. The party whose Proposed Solution is
not selected shall bear the costs of all counsel, experts or other
representatives that are retained by both parties, together with all costs of
the arbitration proceeding, including, without limitation, the fees, costs and
expenses imposed or incurred by the arbitrator. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; including, if applicable,
entry of a permanent injunction under paragraph (b) of Section 5.
11
12
(e) PRESS RELEASES AND PUBLIC DISCLOSURE. Any press release or other
public communication by either the Executive or the Employer with any other
person concerning the terms, conditions or circumstances of Executive's
employment, or the termination of such employment, shall be subject to prior
written approval of both the Executive and the Employer, subject to the proviso
that the Employer shall be entitled to make requisite and appropriate public
disclosure of the terms of this Agreement and any termination hereof, without
the Executive's consent or approval, as may be required under applicable
statutes, and the rules and regulations of the Securities and Exchange
Commission and New York Stock Exchange. Employer shall be entitled to rely on
the advice and counsel of its professional advisors in determining whether any
such disclosure is required.
(f) WAIVER. No waiver by either party at any time of any breach by the
other party of, or compliance with, any condition or provision of this Agreement
to be performed by the other party, shall be deemed a waiver of any similar or
dissimilar provisions or conditions at the same time or any prior or subsequent
time.
(g) NOTICES. Notices given pursuant to this Agreement shall be in
writing, and shall be deemed given when received if personally delivered, or on
the first (1st) business day after deposit with a commercial overnight delivery
service. Notices to the Employer shall be addressed and delivered to the
principal headquarters office of the Employer, Attention: Chairman, with a copy
concurrently so delivered to General Corporate Counsel to the Employer, Barack
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, to the joint attention of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and
▇▇▇▇▇ ▇. ▇▇▇▇▇-▇▇▇▇▇▇▇. Notices to the Executive shall be sent to the address
set forth below the Executive's signature on this Agreement, or to such other
address as Executive may hereafter designate in a written notice given to the
Employer and its counsel.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
WELLINGTON PROPERTIES TRUST, ▇▇▇▇▇ ▇. ▇▇▇▇
a Maryland real estate investment trust
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇ ▇▇▇▇
------------------------------------ --------------------------
Address of Executive:
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
12