EXHIBIT 10.6
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is made
and entered into as of this 20th day of April, 1998, effective as of the 1st
day of January, 1998 (the latter date shall be referred to as the "Effective
Date"), by and between ALEXANDRIA REAL ESTATE EQUITIES, INC., a Maryland
corporation ("Corporation"), and VINCENT R. CIRUZZI, an individual
("Officer") (hereinafter, Corporation and Officer will be referred to
collectively as the "Parties").
RECITAL
WHEREAS, Corporation desires to employ Officer as its Vice
President and Director of Construction and Capital Improvements, and Officer
is willing to accept such employment by Corporation, on the terms and subject
to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties hereto agree as
follows:
1. POSITION AND DUTIES; LOCATION.
During the Term (as defined below) of this Agreement, Officer
agrees to be employed by and to serve Corporation as its Vice President and
Director of Construction and Capital Improvements. Corporation agrees to
employ and retain Officer in such capacities. Officer shall devote such of
his full business time, energy, and skill to the affairs of Corporation as
shall be necessary to perform the duties of such positions. Officer shall
report to the Chief Executive Officer of the Corporation or such other
officer as the Chief Executive Officer shall direct with the approval of the
Board of Directors of the Corporation (the "Board").
2. TERM OF EMPLOYMENT.
The Term of this Agreement shall commence on the Effective Date
and shall continue until December 31, 1998 (the "Term");
PROVIDED, HOWEVER, that on December 31, 1998, and on each anniversary
thereof, the Term of this Agreement shall automatically be extended for one
(1) additional year unless, not later than ninety (90) days prior to December
31, 1998 or such anniversary thereof, either party shall have given written
notice to the other that it does not wish to extend the Term of the
Agreement. If Officer's employment hereunder shall terminate by reason of
the expiration of the Term (including any extensions thereof), the date of
such termination shall be referred to as the "Termination Date."
3. COMPENSATION, BENEFITS AND REIMBURSEMENT.
3.1. BASE SALARY. During the Term of this Agreement and
subject to the terms and conditions set forth herein, Corporation agrees to
pay to Officer an initial annual "Base Salary" of One Hundred Five Thousand
Dollars ($105,000), or such other amount as may from time-to-time be
determined by Corporation. Unless otherwise agreed in writing by Officer
and Corporation, the Base Salary shall be payable in substantially equal
semimonthly installments in accordance with the standard policies of
Corporation in existence from time-to-time.
3.2. ADJUSTMENTS IN BASE SALARY. Officer's Base Salary shall
be reviewed for the possibility of adjustments no less frequently than on
each anniversary of the Effective Date during the Term of this Agreement.
3.3. DISCRETIONARY BONUS. If Officer is in good standing, as
finally determined by the Chief Executive Officer with the concurrence of the
Board, Officer shall be eligible to receive a discretionary bonus for each
fiscal year of Corporation during the Term of this Agreement, with the actual
amount of any such bonus to be determined by the Chief Executive Officer with
the concurrence of the Board (or a committee of the Board) based upon an
evaluation of Officer's and Corporation's performance during such year and
such other factors and conditions as the Board (or a committee of the Board)
deems relevant.
3.4. STOCK OPTIONS. Subject to the determination of the
Board (or a committee of the Board) and pursuant to the terms of a stock
option agreement issued under a stock option plan of the Corporation,
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Corporation may grant to Officer the right and option to purchase shares of
the authorized but unissued Common Stock of Corporation on the terms and
conditions set forth therein. Nothing contained herein shall be construed to
increase or decrease Officer's compensation and/or benefits in existence at
the time the options are granted.
3.5. ADDITIONAL BENEFITS. Officer shall be entitled to the
following additional benefits under this Agreement:
(a) OFFICER BENEFITS. During the Term of this Agreement,
Officer shall be eligible to participate in Corporation's existing medical
plan and 401(k) plan and such existing stock incentive plans available to
senior management of the Corporation in accordance with the terms and
conditions of such plans. For purposes of establishing the length of service
under any benefit plans or programs of Corporation, Officer's employment with
the Corporation will be deemed to have commenced on September 9, 1996.
During the Term of this Agreement, Corporation shall pay one hundred percent
(100%) of Officer's medical premiums under Corporation's medical plan and any
other welfare benefit plans for which Officer qualifies that are in existence
from time-to-time.
(b) VACATION. During the Term of this Agreement, Officer
shall be entitled to up to three (3) weeks paid vacation annualized during
each calendar year during the Term of this Agreement. Limits on accrual of
vacation not taken during any calendar year shall be subject to and in
accordance with Corporation's existing policy.
(c) REIMBURSEMENT FOR EXPENSES. During the Term of this
Agreement, Corporation shall reimburse Officer for all reasonable
out-of-pocket business and/or entertainment expenses incurred by Officer for
the purpose of and in connection with the performance of his services
pursuant to this Agreement and in accordance with any existing travel and
expense reimbursement policies of Corporation. Officer shall be entitled to
such reimbursement upon the presentation by Officer to Corporation of
vouchers or other statements itemizing such expenses in reasonable detail
consistent with Corporation's policies. In addition, Officer shall be
entitled to reimbursement for (i) dues and membership fees in professional
organizations and/or industry associations in which
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Officer is currently a member or becomes a member, and (ii) appropriate
industry seminars and mandatory continuing education.
(d) WITHHOLDING. Compensation and benefits paid to Officer
under this Agreement shall be subject to applicable federal, state and local
wage deductions and other deductions required by law.
4. TERMINATION OF THE AGREEMENT.
4.1. TERMINATION WITHOUT CAUSE. In the event that
Corporation terminates this Agreement without Cause (as defined below),
Officer shall be entitled to a severance payment equal to seven and one half
(71/2) months ("Severance Period") of Officer's annualized Base Salary
("Severance Payment"). Such Severance Payment shall be payable in monthly
installments during the Severance Period, in accordance with the provisions
set forth in Paragraph 3.1 above. Officer shall not be entitled to receive a
Severance Payment hereunder if he voluntarily terminates his employment or is
terminated by reason of death or disability or for Cause.
4.2. TERMINATION FOR CAUSE. Prior to the Termination Date,
the Corporation shall have the right to terminate this Agreement for Cause
immediately after written notice has been delivered to Officer, which notice
shall specify the reason for and the effective date of such Termination. For
purposes of this Agreement, "Cause" shall mean the following:
(i) Officer's Material breach, repudiation or failure to comply with
or perform any of the terms of this Agreement, any of Officer's
duties, or any of Corporation's policies or procedures (including
without limitation any such policies or procedures relating to
conflicts of interests or standards of business conduct) or
deliberate interference with the compliance by any other employee
of Corporation with any of the foregoing;
(ii) The conviction of Officer for, or pleading by Officer of no
contest (or similar plea) to, fraud, embezzlement,
misappropriation of assets, malicious mischief, or any felony,
other
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than a crime for which vicarious liability is imposed upon
Officer solely by reason of Officer's position with Corporation
and not by reason of Officer's conduct;
(iii) Any other act, omission, event or condition constituting cause for
the discharge of any employee under applicable law.
Before terminating the Agreement pursuant to this Paragraph
4.2(i), Corporation first shall have given Officer written notice specifying
the nature of the breach, repudiation or failure to comply and thirty (30)
days thereafter in which to cure such breach, repudiation or failure to
comply, and Officer shall have failed to cure. For purposes of this
Paragraph 4.2, "Material" shall mean a breach, repudiation or failure that
the Board determines has resulted in material injury to Corporation.
4.3. OFFSET. Although Officer shall not be required to
mitigate damages under this Agreement by seeking other comparable employment
or otherwise, the amount of any payment or benefit provided for in this
Agreement shall be reduced by any compensation earned by or provided to
Officer as the result of employment by an employer other than Corporation
prior to the expiration of the Term of this Agreement.
5. NONCOMPETITION.
During the Term of this Agreement, including the period, if
any, with respect to which Officer shall be entitled to Severance Payments,
Officer shall not engage in any activity that is or may be competitive with
the business of Corporation, directly or indirectly, whether or not for
compensation, including, but not limited to, providing services similar to
those provided by the Company; offering or soliciting or accepting an offer,
to provide such services or taking any action to form, or become employed by,
a firm or business to provide such services.
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6. MISCELLANEOUS.
6.1. CONFIDENTIALITY. Without limiting the scope of the
Agreement Regarding Proprietary Information between the Parties, dated as of
December 30, 1997 (the "Proprietary Information Agreement"), Officer agrees
that all confidential and proprietary information relating to the business of
Corporation shall be kept and treated as confidential both during and after
the Term of this Agreement, except as may be permitted in writing by the
Board or as such information is within the public domain or comes within the
public domain without any breach of this Agreement.
6.2. WAIVER. The waiver of the breach of any provision of
this Agreement shall not operate or be construed as a waiver of any
subsequent breach of the same or other provision hereof.
6.3. ENTIRE AGREEMENT; MODIFICATIONS. Except as otherwise
provided herein, this Agreement (together with the Proprietary Information
Agreement and any other agreements and plans referred to herein) represents
the entire understanding between the Parties with respect to the subject
matter hereof, and this Agreement supersedes any and all prior
understandings, agreements, plans and negotiations, whether written or oral,
with respect to the subject matter hereof, including without limitation any
understandings, agreements or obligations respecting any past or future
compensation, bonuses, reimbursements or other payments to Officer from
Corporation. All modifications to this Agreement must be in writing and
signed by the party against whom enforcement of such modification is sought.
6.4. NOTICES. All notices and other communications under
this Agreement shall be in writing and shall be given by facsimile or
first-class mail, certified or registered with return receipt requested, and
shall be deemed to have been duly given three (3) days after mailing or
twenty-four (24) hours after transmission of a facsimile to the respective
persons named below:
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If to Corporation: Alexandria Real Estate Equities, Inc.
135 North Los Robles Avenue, Suite 250
Pasadena, CA 91101
Phone: (626) 578-0777
Facsimile: (626) 578-0770
Attn: Joel S. Marcus, CEO
If to Officer: Vincent Ciruzzi
11914 Briarleaf Way
San Diego, California 92128
Phone: (619) 486-8607
6.5. HEADINGS. The Paragraph headings herein are intended
for reference only and shall not determine the construction or interpretation
of this Agreement.
6.6. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California without
regard to its principles of conflicts of laws.
6.7. ARBITRATION. Any dispute arising out of or relating to
this Agreement that cannot be settled by good faith negotiation between the
Parties shall be submitted to ENDISPUTE for final and binding arbitration
pursuant to ENDISPUTE's Arbitration Rules incorporated herein by reference,
which arbitration shall take place in Los Angeles, California and shall be
the exclusive remedy of the Parties hereto. The resulting arbitration shall
be deemed a final order of a court having jurisdiction over the subject
matter, shall not be appealable, and shall be enforceable in any court of
competent jurisdiction. Submission to arbitration shall not preclude the
right of any party hereto involved in a dispute regarding this Agreement
(each a "Disputing Party" and collectively, the "Disputing Parties") to
institute proceedings at law or in equity for injunctive or other relief
pending the arbitration of a matter subject to arbitration pursuant to this
Agreement. Any documentation and information submitted by any party in the
arbitration proceeding shall be kept strictly confidential by the Parties and
the arbitrator.
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In addition to any other relief or award granted by the
arbitrator to either Disputing Party, the arbitrator shall determine the
extent to which each Disputing Party has prevailed as to the material issues
raised in the arbitration, and, based upon such determination, shall
apportion to each Disputing Party its ratable share of (i) the Disputing
Parties' reasonable attorneys' fees and other costs reasonably incurred in
the arbitration, (ii) the expense of the arbitrator, and (iii) all other
expenses of the arbitration. The arbitrator shall make such determination and
apportionment whether or not the dispute proceeds to a final award.
6.8. SEVERABILITY. Should a court or other body of competent
jurisdiction determine that any provision of this Agreement is excessive in
scope or otherwise invalid or unenforceable, such provision shall be adjusted
rather than voided, if possible, and all other provisions of this Agreement
shall be deemed valid and enforceable to the extent possible.
6.9. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which taken together shall constitute one and the
same Agreement.
6.10 INDEMNIFICATION. In addition to any rights to
indemnification to which Officer is entitled under the Corporation's Articles
of Incorporation and By-Laws, Corporation shall indemnify Officer at all
times during and after the Term of this Agreement to the maximum extent
permitted under Section 2-418 of the General Corporation Law of the State of
Maryland or any successor provision thereof and any other applicable state
law, and shall pay Officer's expenses in defending any civil or criminal
action, suit, or proceeding in advance of the final disposition of such
action, suit, or proceeding, to the maximum extent permitted under such
applicable state laws.
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IN WITNESS WHEREOF, the Parties hereto have executed this
Agreement.
CORPORATION:
ALEXANDRIA REAL ESTATE
EQUITIES, INC.
a Maryland corporation
By: /s/ JOEL S. MARCUS
---------------------------------
Joel S. Marcus
Chief Executive Officer
Date: April 23, 1998
OFFICER:
/s/ VINCENT R. CIRUZZI
---------------------------------
Vincent Ciruzzi
Date: April 20, 1998
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