EXHIBIT 10.10
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into and
effective as of October 1, 1990, by and between REAL ESTATE INVESTMENT TRUST
OF CALIFORNIA, a California real estate investment trust ("Employer"), and
LEROY E. CARLSON, an individual ("Employee").
RECITALS
A. Employee is currently employed by Employer in the capacity of
Vice President, Treasurer and Secretary of Employer and is experienced in the
field of commercial real estate investment; and
B. Employee desires to retain the continued services of Employee
and Employee desires to provide such services to Employer on the terms and
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties agree as follows:
1. EMPLOYMENT. Employer hereby employs Employee, and Employee
hereby accepts employment, upon the terms and conditions of this Agreement.
2. TERM AND ANNUAL REVIEW.
(a) TERM. Subject to the provisions in Sections 9 and 10
hereof, the term of this Agreement shall begin on the date first above
written and shall terminate on the first anniversary thereof.
(b) RENEWAL. Subject to the provisions in Sections 9 and 10
hereof, this Agreement shall be renewed automatically for successive one year
terms.
(c) ANNUAL REVIEW. The Board of Trustees of Employer or any
duly empowered committee thereof (hereinafter referred to as the "Board")
shall perform an annual evaluation and review of Employee's job performance
and shall conduct a performance review session with Employee regarding these
evaluations.
3. COMPENSATION. During the first twelve-month period of this
Agreement, Employer shall pay Employee a salary of $180,000 (Employee's
salary, as adjusted for the most recent twelve-month period, is hereinafter
referred to as the "Salary"), payable in equal installments in accordance
with Employer's normal payment cycle. Based in part on the results of the
annual evaluation and review conducted pursuant to Section 2(c) hereof, for
each subsequent twelve-month period of this Agreement,
Employee's Salary may be adjusted by such amount as a majority of the
independent Trustees of the Board, in their sole discretion, shall determine.
4. DUTIES. Employee shall be engaged as Vice President, Treasurer
and Secretary of Employer. Employee shall have the authority and power to
perform, and shall perform, all duties that are customary for a Vice
President, Treasurer and Secretary of a company, and shall have such other
authority and perform such other duties as may be reasonably assigned by the
Board. If Employee is elected or appointed as a Trustee of Employer,
Employee will serve in that capacity without further compensation. Employee
agrees to provide the services contemplated by this Agreement (without
additional compensation) without regard to whether any of Employer's
operations are conducted directly by Employer or through any division,
subsidiary or affiliate of Employer. Employee's office shall be located at
Employer's principal business offices, which are presently located at 12011
San Vicente Boulevard, Suite 707, Los Anqeles, California 90049, but which
may be moved from time to time as determined by the Board.
5. EXTENT OF SERVICE. Employee shall devote his attention and
energies on a full-time basis to the business of Employer and to the
discharge of his duties as set forth in Section 4 above.
6. EXPENSES. Employee is authorized to incur ordinary and
necessary expenses for performing his duties hereunder, consistent with such
policies as may from time to time be established by the Board. Employer will
reimburse Employee for all such expenses upon the presentation by Employee,
from time to time, of an itemized account of such expenditures.
7. INSURANCE AND OTHER EMPLOYEE BENEFITS.
(a) INSURANCE. Employer shall maintain medical insurance
coverage for the benefit of all employees on such basis and terms as approved
by the Board. Employee and his qualifying dependents shall be entitled to
participate in such medical insurance coverage and in any retirement,
pension, group insurance, death benefit or other employee benefit programs
maintained by Employer during the term of this Agreement.
(b) STOCK OPTION PLAN. The Board, in its sole discretion, may
establish a stock option plan pursuant to which certain employees selected by
the Board shall be granted options to purchase shares of Employer's Shares of
Beneficial Interest. Employee will be eligible to participate in such stock
option plan. Grants under the stock option plan, if any, will be in the sole
discretion of the Board.
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8. DISABILITY. Subject to the provisions of Section 9(a) hereof,
if Employee is unable to perform his normal duties by reason of illness or
incapacity (whether physical or mental) for a period of more than one month
during any six-month period, the Salary otherwise payable to him during the
continued period of such illness or incapacity shall be reduced by 50%;
provided, however, that Employee shall be further entitled to all benefits
available to him under any disability insurance policy maintained by
Employer. Employee's full Salary shall be reinstated upon his return to
employment and the discharge of his full duties hereunder.
9. TERMINATION. This Agreement shall terminate prior to the
termination date set forth in Section 2(a) or (b) hereof, as the case may be,
upon the following terms and conditions:
(a) DEATH OR PERMANENT DISABILITY. This Agreement shall
terminate upon the death of Employee or in the event Employee suffers a
disability which is deemed to be permanent. Employee shall be deemed
permanently unable to perform his normal duties for Employer if for a period
of 90 calendar days, or for any 120 days during any period of 180 calendar
days, whether or not consecutive, he shall have for all purposes been in a
non-performing state. An additional determination of permanent disability
may be made at any time by a physician chosen by the majority of the
independent Trustees of the Board, which physician shall opine as to the
physical condition of Employee.
(b) CAUSE. If a majority of the independent Trustees of the
Board vote to remove Employee from his duties for cause, this Agreement shall
terminate and Employee shall be removed from office effective on the date
specified by the Board. For purposes of this Agreement, the term "cause"
shall mean any of the following:
(i) Employee has been convicted or pled guilty or no
contest to any crime or offense involving monies or other property, or any
felony offense for any crime of moral turpitude;
(ii) Employee has committed fraud or embezzlement (such
determination to be made by a majority of independent Trustees of the Board
in their reasonable judgment);
(iii) Employee has breached any of his fiduciary duties to
Employer (such determination to be made by a majority of independent Trustees
of the Board in their reasonable judgment); or
(iv) Employee has neglected or failed to obey a specific
written direction from the Board consistent with this
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Agreement and Employee's duties hereunder, has materially neglected or
failed to satisfactorily discharge any of his duties, responsibilities or
obligations under this Agreement, or in the opinion of the independent
Trustees does not meet the standards of performance expected of a person in
Employee's position (such determination to be made by a majority of the
independent Trustees of the Board in their reasonable judgment).
(c) UPON NOTICE. Employer may terminate this Agreement, for
any reason other than death, disability or cause, effective, in the sole
discretion of the Trustees, either immediately upon written notice by
Employer to Employee of such termination, or effective on the 30th day after
such written notice of such termination, if a majority of the independent
Trustees, in their sole discretion, vote to remove Employee from his duties.
(d) TERMINATION BY EMPLOYEE. Employee may terminate his
obligations under this Agreement by giving Employer at least 90 calendar
days' written notice of such termination.
(e) EFFECT OF TERMINATION. Upon any termination pursuant to
this Section 9, all rights of Employee under this Agreement shall cease to be
effective as of the date of termination, Employee shall be removed from
office and shall resign from all positions with Employer and, to the extent
permitted by law, Employee shall have no right to receive any payments or
benefits hereunder except for:
(i) the Salary, payable pursuant to section 3 hereof, up
to the date of termination; provided, however, that if the termination of
employment is pursuant to Section 9(c) hereof, Employee will be entitled to
payment of an amount equal to six months' Salary;
(ii) reimbursement of expenses incurred in accordance with
Section 6 hereof prior to the date of termination to the extent not
previously reimbursed by Employer; and
(iii) in the case of any termination pursuant to Section
9(a) hereof, Employee shall be entitled to all benefits available to him
under any disability insurance policy maintained by Employer.
10. TERMINATION OF EMPLOYMENT DUE TO CHANGE IN CONTROL. Upon the
termination of employment of Employee as a result of: (a) the sale of
substantially all of Employer's assets; (b) the dissolution of Employer; or
(c) a change in the controlling shareholder interest in Employer resulting
from a tender offer, exchange offer, reorganization, merger or consolidation,
Employee shall be entitled to payment of an amount equal to the then-existing
Salary provided for in Section 3
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hereof, plus an amount equal to the product of the average of the last three
(3) years bonuses, if any, multiplied by a fraction of which the numerator is
equal to the number of calendar days in the then current year up to the date
of termination and the denominator is 365, payable in one payment or on a
monthly basis over a twelve-month period at Employee's election, and in
addition, shall be entitled to the benefits of the insurance coverage
provided for in Section 7(a) hereof, for a period of one year from the date
of Employee's termination of employment.
11. TRADE SECRETS. Employee specifically agrees that he will not
at any time, whether during or subsequent to the term of his employment by
Employer, in any fashion, form or manner, unless specifically consented to in
writing by Employer, either directly or indirectly use or divulge, disclose
or communicate to any person, corporation, firm or entity, in any manner
whatsoever, any confidential information of any kind, nature or description
concerning any matters affecting or relating to the business of Employer,
including, without limiting the generality of the foregoing, operating
expenses, lists or other written records used in Employer's business,
compensation paid to employees and other terms of employment, or any other
confidential information concerning the business of Employer, its manner of
operation, or any other confidential data of any kind, nature or description,
the parties hereto stipulating that as between them, each of the same
constitutes important, material and confidential trade secret information and
affects the successful conduct of Employer's business, and its goodwill, and
that any breach of any of the terms of this Section is a material breach of
this Agreement. All equipment, notebooks, documents, memoranda, reports,
files, books, correspondence, lists, other written and graphic records, and
the like, affecting or relating to the business of Employer, which Employee
may prepare, use, construct, observe, possess or control shall be and remain
Employer's sole property, and upon the termination of Employee's employment
by Employer for any reason, Employee agrees to deliver promptly to Employer
all of the foregoing items which are or have been in his possession or under
his control. Employee agrees that any breach by him of this Section could
not reasonably or adequately be compensated in damages in an action at law
and that Employer shall be entitled to injunctive relief, which may include
but shall not be limited to restraining Employee from taking any act that
would breach this Section.
12. NOTICES. All notices, demands and other communications
hereunder shall be deemed duly given when given in writing and delivered in
hand or when mailed by registered or certified mail, return receipt
requested, postage and registration or certification charges prepaid,
addressed:
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(a) if to Employee:
Mr. LeRoy E. Carlson
843 S. Bundy Drive
Brentwood, California 90049
Telephone: (213) 820-5819
(b) if to Employer:
Real Estate Investment Trust of California
12011 San Vicente Boulevard, Suite 707
Los Angeles, California 90049
Telephone: (213) 476-7793
Telefax: (213) 472-4107
or to such other address as may hereafter be designated by any party in a
written notice given to the other party.
13. BENEFITS. This Agreement shall inure to the benefit of and
shall be binding upon the parties hereto and their respective successors and
assigns, heirs and legal representatives. The provisions of Sections 9(e),
11 and 21 of this Agreement shall survive termination of this Agreement.
14. WAIVER. The failure of either party to insist on strict
compliance with any of the terms, covenants or conditions of this Agreement
by the other party shall not be deemed a waiver of that term, covenant or
condition, nor shall any waiver or relinquishment of any right or power at
any one time or times be deemed a waiver or relinquishment of that right or
power for all or any other times.
15. ENTIRE AGREEMENT. This instrument contains the entire
agreement of the parties with respect to the subject matter hereof. It may
not be changed orally but only by an agreement in writing signed by the
parties hereof.
16. CAPTIONS. The headings of this Agreement are inserted solely
for convenience of reference and are not a part of or are not intended to
govern, limit or aid in the construction of any term or provision in this
Agreement.
17. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which so executed shall be deemed an original but all of which
together shall constitute one and the same instrument.
18. REMEDIES. No remedy conferred by any of the specific
provisions of this Agreement (including those contained in Section 11 hereof)
is intended to be exclusive of any other remedy, and each and every remedy
shall be cumulative and shall
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be in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute or otherwise. The election of any
one or more remedies by either party hereto shall not constitute a waiver of
the right to pursue other available remedies.
19. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, but
shall be enforced to the maximum extent permitted by law, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
20. ARBITRATION. Any dispute or disagreement hereunder or
otherwise relating to Employee's services shall be submitted to arbitration
in Los Angeles, California, before the American Arbitration Association in
accordance with the commercial arbitration rules then in effect; provided,
however, that the arbitrator shall not have the power to award punitive or
exemplary damages. The findings of the arbitrator shall be final and
conclusive upon both parties.
21. GOVERNING LAW. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of California.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
EMPLOYER:
REAL ESTATE INVESTMENT TRUST OF CALIFORNIA
By: A. A. MILLIGAN
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Chairman of Board
EMPLOYEE:
LEROY E. CARLSON
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LeRoy E. Carlson
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FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (the "AMENDMENT") is
made and entered into effective as of January 1, 1995, by and between REAL
ESTATE INVESTMENT TRUST OF CALIFORNIA, a California real estate investment
trust ("EMPLOYER"), and LEROY E. CARLSON, an individual ("EMPLOYEE"), with
reference to the following facts:
A. Employee and Employer executed that certain Employment
Agreement (the "AGREEMENT") dated October 1, 1990, with respect to the
retention by Employer of the continued services of Employee; and
B. The parties hereto wish to amend the Agreement in order to
reflect current information.
NOW, THEREFORE, the parties hereto agree as follows:
1. Paragraph 2(a) captioned "Term" shall be deleted and replaced
in its entirety by the following:
"Subject to the provisions of Sections 9 and 10 hereof, the term
of this Agreement shall begin on January 1, 1995 and shall terminate
on the first anniversary thereof."
2. The first sentence of Section 3 captioned "Compensation" shall
be deleted and replaced in its entirety with the following:
"Employer shall pay Employee a salary of $16,667.00 per month
(Employee's salary, as adjusted for the most recent twelve-month
period, is hereinafter referred to as the "Salary"), payable in
equal installments in accordance with Employer's normal payment
cycle."
3. All other terms and conditions of the Agreement shall remain in
full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the date first above written.
REAL ESTATE INVESTMENT TRUST OF CALIFORNIA
By: WILLIAM BORSARI
--------------------------------------
Chairman of the Board
LEROY E. CARLSON
--------------------------------------
LeRoy E. Carlson