SECOND AMENDMENT TO THE EXECUTIVE EMPLOYMENT
AGREEMENT AND GENERAL AND SPECIAL RELEASE
This Second Amendment to the Executive Employment Agreement and
General and Special Release (this "Second Amendment and Release") is entered
into as of this 30th day of May, 1997, by and between ALEXANDRIA REAL ESTATE
EQUITIES, INC., a Maryland corporation (formerly known as Health Science
Properties, Inc.) (the "Corporation"), and JERRY M. SUDARSKY, an individual
(the "Officer") (collectively, the "Parties").
WHEREAS, Officer originally entered into that certain Executive
Employment Agreement (the "Employment Agreement"), dated as of June 9, 1994,
with Health Science Properties Holding Corporation (the "Parent"), and on
November 3, 1994, Parent transferred to the Corporation substantially all of
its property, assets and certain liabilities, including Parent's rights and
obligations under the Employment Agreement;
WHEREAS, on July 30, 1996, the Parties amended the Employment
Agreement by execution of that certain First Amendment to the Employment
Agreement Between Health Science Properties, Inc. And Jerry M. Sudarsky,
pursuant to which the Corporation agreed to employ Officer as its Chairman of
the Board of Directors (the "Chairman") and Chief Executive Officer until
December 31, 2000;
WHEREAS, on March 14, 1997, Officer resigned from the position of
Chief Executive Officer of the Corporation and currently serves as full-time
executive Chairman of the Corporation; and
WHEREAS, upon consummation of an initial public offering by the
Corporation of its common stock (the "IPO"), Officer desires to retire from
employment with the Corporation and thereafter to serve as non-executive
Chairman of the Corporation and perform the duties consistent with such
position for the duration of his term as Chairman, which expires at the next
annual election of officers.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties hereto
agree as follows:
1. AMENDMENTS TO EMPLOYMENT AGREEMENT.
a. OFFICER'S RETIREMENT; TERMINATION OF EMPLOYMENT AGREEMENT.
Effective upon consummation of the IPO, Officer shall voluntarily retire from
employment with the Corporation. Except as expressly provided herein, all of
the Corporation's duties and obligations under the Employment Agreement shall
terminate effective as of the date of Officer's retirement. Officer
acknowledges and agrees that his voluntary retirement pursuant to this Second
Amendment and Release is not, and shall not be treated as, a Termination for
Good Reason pursuant to Section 4.2 of the Employment Agreement.
b. RETIREMENT BENEFITS. Section 3.5(e) of the Employment
Agreement is hereby amended in its entirety to read as follows:
"(e) RETIREMENT BENEFIT. Commencing on the date of consummation of the
IPO, the Company shall pay Officer an annual retirement benefit equal to
One Hundred Fifty Thousand Dollars ($150,000) per year for a period of
three (3) years, and, thereafter, shall pay Officer an annual retirement
benefit equal to Ninety Thousand Dollars ($90,000) per year as provided
herein; PROVIDED, HOWEVER, that commencing June 1 of the year following
the year in which the retirement benefit is reduced to Ninety Thousand
Dollars ($90,000) per year, the amount of the retirement benefit shall
be increased by 2% per year on June 1 of each year thereafter. The
benefit shall be payable monthly, beginning on the first day of the
month following the month in which consummation of the IPO occurs and
shall be payable in the form of a 100% joint and survivor annuity on the
lives of Officer and Officer's spouse as of the date hereof, if then
living; PROVIDED, HOWEVER that in the event of a Change in Control (as
defined in Section 4.4(d) of this Employment Agreement), the
Corporation shall secure the payment of such benefit through the
purchase of an annuity contract that provides Officer with the benefit
described in this Paragraph 3.5(e). In the event of Officer's death
prior to the commencement of the retirement benefit under this Paragraph
3.5(e), Officer's spouse as of the date hereof, if then living, shall be
entitled to receive, commencing on the first day of the month next
following Officer's death, the retirement benefit, the Officer's spouse
as of the date hereof, would have received had Officer retired and
commenced receiving benefits immediately prior to his death. Amounts
payable under this Paragraph 3.5(e) shall be offset by any amounts paid
to Officer under any Disability Policy maintained by the Corporation."
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c. SURVIVAL OF PROVISIONS. Notwithstanding the termination
of the Employment Agreement pursuant to Section 1(a), above, the rights and
obligations of the Parties with respect to Sections 3.5(e) (as amended in
Section 1(b), above), 5, 6.1, 6.2, 6.3, 6.8, 6.10, 6.11, and 6.13 of the
Employment Agreement shall survive the termination of that agreement.
2. STATUS AS CHAIRMAN OF THE BOARD OF DIRECTORS. The execution
of this Second Amendment and Release shall not preclude Officer from serving
as, and the Corporation hereby acknowledges that it intends to continue to
retain Officer as, non-executive Chairman performing the duties consistent
with such position at least for the remainder of his term as Chairman, which
expires at the next annual election of officers.
3. RELEASE OF CLAIMS AND OTHER MATTERS.
a. OFFICER'S GENERAL AND SPECIAL RELEASE. In consideration
of the benefits provided to Officer pursuant to this Second Amendment and
Release, Officer hereby forever releases and discharges the Corporation, its
parent, subsidiary and affiliated corporations, and each of their respective
present and former officers, directors, managers, agents, employees, and
attorneys, and their successors and assigns (collectively, the "Released
Parties") from any and all claims, charges, complaints, liens, demands,
causes of action, obligations, damages and liabilities, KNOWN OR UNKNOWN,
SUSPECTED OR UNSUSPECTED, that Officer had, now has, or may hereafter claim
to have against the Released Parties, arising out of or relating in any way
to Officer's employment with or his separation from the Corporation, any and
all alleged acts or omissions of any of the Released Parties, and any other
claim relating to any of the Released Parties from the beginning of time
through the effective date of Officer's resignation from the Corporation
pursuant to Section 1(a), above. This release specifically extends to,
without limitation, claims or causes of action for wrongful termination,
impairment of ability to compete in the open labor market, breach of an
express or implied contract, breach of the covenant of good faith and fair
dealing, breach of fiduciary duty, fraud, misrepresentation, defamation,
slander, infliction of emotional distress, disability, loss of future
earnings, and claims under the California Constitution, the United States
Constitution, and applicable state and federal fair employment laws, federal
equal employment opportunity laws, and federal and state labor statutes and
regulations, including, but not limited to, the Civil Rights Act of 1964, as
amended, the Fair Labor Standards Act, as amended, the Americans With
Disabilities Act of 1990, the Rehabilitation Act of 1973, as amended, the Em-
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ployee Retirement Income Security Act of 1974, as amended, the Age
Discrimination in Employment Act of 1967, as amended, and the California Fair
Employment and Housing Act. Notwithstanding the generality of the foregoing,
nothing contained herein shall release any of the Released Parties from their
obligations under this Second Amendment and Release.
b. OFFICER'S WAIVER OF RIGHTS AFFORDED BY CALIFORNIA CIVIL
CODE SECTION 1542. Officer expressly waives all rights afforded by Section
1542 of the Civil Code of the State of California ("Section 1542") with
respect to the Released Parties. Section 1542 states as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.
Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release, Officer understands and agrees that
this Second Amendment and Release is intended to include all claims, if any,
that Officer may have which he does not now know or suspect to exist in his
favor against the Released Parties and this Second Amendment and Release
extinguishes those claims.
4. REVIEW AND REVOCATION PERIOD. Officer acknowledges that the
Corporation has advised Officer that he may consult with an attorney of his
choosing prior to signing this Second Amendment and Release and that Officer
has twenty-one (21) days during which to consider the provisions of this
Second Amendment and Release, although Officer may sign and return it sooner.
Officer further acknowledges that he has been advised by the Corporation
that he has the right to revoke this Second Amendment and Release for a
period of seven (7) days after signing it and that this Second Amendment and
Release shall not become effective or enforceable until such seven (7)-day
revocation period has expired. Officer acknowledges and agrees that if he
wishes to revoke this Agreement, he must do so in writing, and that such
revocation must be signed by Officer and received by the Corporation no later
than 5:00 p.m. Pacific Standard Time on the seventh (7th) day after Officer
has signed this Second Amendment and Release.
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5. VOLUNTARY AGREEMENT. Each Party to this Second Amendment and
Release acknowledges and represents that he or it (a) has fully and carefully
read this Second Amendment and Release prior to signing it,(b) has been, or
has had the opportunity to be, advised by independent legal counsel of his or
its own choice as to the legal effect and meaning of each of the terms and
conditions of this Second Amendment and Release, and (c) is signing and
entering into this Second Amendment and Release freely and voluntarily and
without duress or undue pressure or influence of any kind or nature
whatsoever and has not relied on any promises, representations or warranties
regarding the subject matter hereof other than that which is set forth in
this Second Amendment and Release.
6. BINDING EFFECT. This Second Amendment and Release shall be
binding upon the Parties and their respective heirs, administrators,
representatives, executors, successors and assigns, and shall inure to the
benefit of the Parties and their respective heirs, administrators,
representatives, executors, successors and assigns.
7. GOVERNING LAW. This Second Amendment and Release shall be
construed and enforced pursuant to the laws of the State of California
applicable to contracts made and entirely to be performed therein.
8. COUNTERPARTS. This Second Amendment and Release may be
executed in counterparts, each of which shall be an original and all of which
together shall constitute one and the same agreement.
9. ENTIRE AGREEMENT; MODIFICATION. This Second Amendment and
Release, together with the Employment Agreement, constitute the entire
understanding of the Parties and neither the Second Amendment and Release, nor
the Employment Agreement, may be modified except in a writing signed by the
Parties. Other than as set forth herein, this Second Amendment and Release
supersedes all prior written and/or oral and all contemporaneous oral
agreements, understandings and negotiations regarding the subject matter hereof.
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IN WITNESS WHEREOF, the Parties hereto have executed this Second
Amendment and Release on the day and year first above written.
CORPORATION:
ALEXANDRIA REAL ESTATE EQUITIES,
INC., a Maryland corporation
By: /s/ Joel S. Marcus
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Joel S. Marcus
Chief Executive Officer
OFFICER:
/s/ Jerry M. Sudarsky
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Jerry M. Sudarsky