Exhibit 10.5.8
SENIOR EXECUTIVE
DEFERRED COMPENSATION ARRANGEMENT
THIS SENIOR EXECUTVE DEFERRED COMPENSATION ARRANGEMENT (the
"Arrangement") is put in place this 1st day of January, 2004 by CBL & Associates
Management, Inc. and its affiliated entities (collectively, "CBL"), including
but not limited to CBL & Associates Properties, Inc. (the "REIT"), for the
benefit of __________________ (the "Executive"). The Arrangement is specifically
designed and intended to be a non-funded and unsecured promise on the part of
CBL to make certain payments to the Executive within the time parameters set
forth herein. The Arrangement is not intended nor shall it be deemed an employee
benefit plan subject to the Employee Retirement Income Security Act of 1974
("ERISA") or a qualified retirement plan subject to provisions of the Internal
Revenue Code of 1986 (the "Code").
1. Objective. The objective and purpose of the Arrangement is to allow
the Executive to defer compensation which shall be payable to him in the future
as set forth herein. Pursuant to the elections provided to the Executive in this
Arrangement, he may defer portions of his salary from CBL to be paid to him to
dates in the future as set forth herein.
2. Creditor Status. The Executive shall be afforded no priority by
virtue of this Arrangement over the secured or unsecured creditors of CBL but
shall be a general unsecured creditor of CBL as to the amounts to be payable to
him under this Arrangement. CBL's obligations under this Arrangement are merely
promises to make the payments set forth herein at a future point in time
pursuant to this Arrangement. Such payments shall not be funded in any way and
shall be payable only from the general assets of CBL.
3. Elections. Prior to the beginning of any period for which the
Executive may earn compensation (salary) from CBL, the Executive shall notify
CBL of his desire to have all or any portion of said amounts deferred and paid
to him pursuant to the terms of this Arrangement. By his execution below, the
Executive has elected to defer salary increases that he may be entitled to
receive from CBL from the date of this Arrangement and forward pursuant to the
terms of this Arrangement. The parties acknowledge that Executive has been
receiving salary increases for the years 1995 - 2003 in the form of shares of
unrestricted common stock of the REIT ("REIT Stock") and that the Executive now
has elected to receive such salary increases and his salary increase for the
2004 year and future years pursuant to the terms of this Arrangement.
4. Specific Calculation of Amounts, Issuance of REIT Stock, Vesting
Period and Deemed Reinvestment of Dividends. On any specific salary increase to
which the Executive may be entitled and for which the Executive has elected to
defer pursuant to this Arrangement, the dollar amount of the salary increase
shall be determined by CBL. Said amount shall then be divided into 12 equal
amounts which shall, except as set forth in Section 5(b) below, vest in four
equal quarterly increments on the last day of each calendar quarter over the
period beginning in January of the year at issue and terminating on December 31
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of the year at issue (the "Vesting Period"). Within fifteen days following the
end of each calendar quarter of the Vesting Period, an amount of REIT Stock
shall be issued to the Executive pursuant to this Arrangement equal to the
amount of REIT Stock that could have been purchased by the Executive with the
amount of the salary increase allocable to each calendar month during the
quarter at the closing trading price of the REIT Stock on the New York Stock
Exchange ("NYSE") on the last trading day of the particular months within the
calendar quarter at issue. Following each calendar quarter there shall be
additional shares of REIT Stock issued to the Executive in amounts equivalent to
the shares of REIT Stock that could have been purchased by the reinvestment of
dividends paid by the REIT on its common stock for the Vesting Period under the
REIT's Dividend Reinvestment Plan (the "DRIP") as if dividends had been paid on
the REIT Stock the Executive receives following the conclusion of the calendar
quarter at issue. These additional shares shall be issued to the Executive due
to the possibility that the Executive may not have received the shares of REIT
Stock by the particular record date at issue with respect to the shares of REIT
Stock issued to the Executive for the particular calendar quarter; provided,
however, if the Executive has received the shares of REIT stock by the
particular record date at issue, no further shares will be issued to Executive
based on the deemed reinvestment of dividends as the Executive will receive
those dividends by virtue of having the REIT Stock on the particular record
date. An example of how the above stated procedures would work is as set forth
below:
Example: Executive receives a salary increase of $120,000 for year one.
That amount is then broken down into equal monthly amounts of $10,000 per
month. The trading price of the REIT's common stock on the last trading day
of January was $50/share, of February was $52/share and of March was
$53/share; a dividend of $.75/share is declared for shareholders of record
as of March 30 and payable on April 18; and on April 18, the DRIP
reinvestment price is $53.50/share. Monthly accruals of 200, 192.3 and
188.68 shares, respectively, occur under this Arrangement and Executive is
issued 580.98 shares following the end of March after the March 30 record
date. Executive is then issued an additional 8.15 shares representing the
deemed dividend on the shares of REIT Stock that Executive received since
Executive was not issued the shares by the record date of March 30. Had the
Executive received the 580.98 shares on March 30, no further shares would be
issued to the Executive via deemed dividend reinvestment as the Executive
would receive the actual cash dividend on the 580.98 shares.
On any issuance of REIT Stock to the Executive pursuant to this
Arrangement, CBL shall determine, in its sole and absolute discretion, whether
to cause the issuance of fractional shares or whether to cause the issuance of a
whole number of shares or whether to pay fractional shares in the form of cash
based on the closing trading price of the REIT Stock on the date one day prior
to the date upon which the REIT Stock is to be issued to the Executive.
5. Termination of Arrangement. (a) This Arrangement shall be terminated
and all vested amounts herein shall be paid to the Executive, his executor or
representative, in the form of shares of REIT Stock, upon the earlier to occur
of the following:
(i) The death or disability of the Executive;
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(ii) The termination of the Executive's employment with CBL;
(iii) The sale or disposition of all assets of CBL to a
non-related third party or a merger or consolidation
of CBL where CBL is not the surviving entity; and/or
(iv) On ten (10) days prior written notice by CBL to the
Executive.
(b) On any termination of this Arrangement other than a termination
which is effective on the first day of a particular calendar quarter, Executive
shall be entitled to receive the shares of REIT Stock that would have accrued
and been payable to him at the end of the calendar quarter within which the
termination occurs but such accrual shall be only from the first day of such
calendar quarter to the date of termination and shall not include any increase
for deemed DRIP reinvestment of dividends.
6. Restriction on Transfer of the Executive's Rights. During the term
of this Arrangement, the Executive may not transfer, pledge, alienate, assign or
otherwise dispose of all or any of his rights under this Arrangement.
7. Income Tax Recognition and Corresponding Compensation Deduction;
Employment Taxes and Withholding. (a) Upon the issuance of the REIT Stock to
Executive as set forth herein, the Executive shall recognize ordinary taxable
income upon his receipt of same and CBL shall be entitled to deduct, as
compensation paid, the said amount.
(b) CBL, in its sole and absolute discretion, shall make such
provisions and take such steps as it may deem necessary or appropriate for the
withholding of all Federal, state, local and other taxes required by law to be
withheld with respect to the shares of REIT Stock issued pursuant to this
Arrangement pursuant to applicable provisions of the Internal Revenue Code of
1986, as amended (the "Code") including, but not limited to, the following: (i)
deducting the amount of any such withholding taxes therefrom or from any other
amounts then or thereafter payable to the Executive by CBL or any of its
subsidiaries or affiliates; (ii) requiring the Executive, or the beneficiary or
legal representative of the Executive, to pay to CBL the amount required to be
withheld or to execute such documents as CBL deems necessary or desirable to
enable CBL to satisfy its withholding obligations; and/or (iii) withholding from
the shares of REIT Stock otherwise payable and/or deliverable one or more of
such shares having an aggregate fair market value, determined as of the date the
withholding tax obligation arises, less than or equal to the amount of the total
withholding tax obligation.
8. Accredited Investor Status; Representations. Executive acknowledges
that his interests under this Arrangement may be considered a security for
purposes of the Securities Act of 1933, as amended (the "Securities Act"), and
that CBL has not filed and will not file any registration statement in respect
of such interests, and that CBL is relying on the Executive's representation in
this Section 8 in order to qualify the offering of such securities (if the
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interests are considered as securities) for exemption from registration under
the Securities Act. Executive hereby represents and warrants that he is an
"Accredited Investor" within the meaning of Section 501(a) of Regulation D
promulgated under the Securities Act. Executive agrees that he will immediately
notify CBL if, at any time during the term of this Arrangement, he ceases to be,
or has reason to believe that he does not qualify as an Accredited Investor;
and, in such event, CBL may immediately terminate this Arrangement and thereupon
pay all vested amounts to Executive. Executive (i) understands and acknowledges
the risks inherent in deferring amounts pursuant to this Arrangement and having
said amounts credited as if invested in REIT Stock, (ii) has the financial
ability to bear the economic risk of this Arrangement (including possible loss),
(iii) has adequate means for providing for his current needs and personal
contingencies and has no need for liquidity with respect to the amounts deferred
under this Arrangement, and (iv) has such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of this
Arrangement and has obtained, in his judgment, sufficient information from CBL
to evaluate the merits and risks of this Arrangement.
9. Miscellaneous. (a) This Arrangement is not intended to be nor shall
it be deemed to be an agreement of employment between the Executive and CBL.
(b) This Arrangement shall be governed by and construed under
the laws of the State of Tennessee.
(c) This Arrangement shall not be construed as requiring CBL
to pay any amount of salary or bonus to the Executive other than the amounts of
salary increases that the Executive has elected or may elect in the future to
defer into the Arrangement.
(d) This Arrangement shall not be construed in any fashion as
a guarantee or assurance by CBL of the price or value of the REIT stock and
whether it shall fluctuate positively or negatively during the course of this
Arrangement.
IN WITNESS WHEREOF, CBL and the Executive have executed this
Arrangement to be effective as of the date first above written.
CBL & ASSOCIATES MANAGEMENT, INC.
(for itself and its affiliates)
By:_______________________________
Name:
Title:
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[Name of Executive]