Exhibit 10(b)
SEVERANCE AND CHANGE IN CONTROL AGREEMENT
-----------------------------------------
Amendment and Restatement of Agreement dated as of
_______________
AGREEMENT by and between EASTGROUP PROPERTIES, INC. a Maryland corporation
(the "Company"), with offices at 300 One Jackson Place, 188 East
Capitol Street,
Jackson, Mississippi 39201-2195, and ____________________ (the
"Executive"), an
individual residing
at ____________________, dated as of the ____ day of
__________, 200_.
WHEREAS, the Company
entered into an
agreement designated
the Change in
Control Agreement with
the Executive,
dated as of the ____
day of __________,
____, and has since amended that Agreement (as amended,
the "Prior
Agreement");
and
WHEREAS, the intent of
the Prior Agreement
was to provide the
Executive
with compensation arrangements upon a Change in Control (as defined
in the Prior
Agreement) that provided the Executive with financial security upon a Change in
Control and were competitive with those of other corporations;
and
WHEREAS, the Board of
Directors of the Company (the "Board") confirms the
intent and purposes of the Prior Agreement and believes that the interests of
the Company and its
stockholders would be
further served by
assuring that the
Change in Control compensation arrangements would not be subject
to distortion,
when considered on a
net after-tax basis,
by the excise tax imposed by section
4999 of the Internal Revenue Code of 1986, and by establishing
certain severance
and death benefits for the Executive; and in order to accomplish these
objectives, the Board
has caused the Company to enter into this Agreement as an
amendment to and restatement of the Prior Agreement.
NOW
THEREFORE,
the parties, for good and valuable consideration and
intending to be legally bound, agree as follows:
1.
Operation and Term of Agreement. This Agreement shall amend and
restate
the Prior Agreement effective immediately upon its execution. This
Agreement may
be terminated
by the Company
upon 24 months'
advance written notice to the
Executive; provided,
however, that after a Change in
Control of the
Company
during the term of this Agreement, this Agreement shall remain in
effect until
all of the obligations
of the parties under the Agreement are satisfied and the
Protection Period (as
defined below) has expired. Prior to a Change in Control
this Agreement shall
immediately terminate
upon termination of the Executive's
employment or upon the
Executive's
ceasing to be an elected officer of the
Company, except in the case of such termination under circumstances
set forth in
Section 2(g), 3, 4, or 5 below.
2.
Certain Definitions.
The following words and phrases shall have the
meanings given for the purposes of this Agreement:
(a)
"Average Annual
Compensation" shall mean an amount equal to the annual
average of the sums of (i) the Executive's annual base salary from the
Company
plus (ii) the amount of cash bonus paid by the Company to the
Executive, in each
case for the three
calendar years that ended immediately before (or, if
applicable, coincident with) a specified date.
<PAGE>
(b)
"Breach of Duty" shall mean (i) the Executive's willful misconduct in
the performance
of his duties
toward the Company;
or (ii) the
commission or
omission of any
act by the
Executive that constitutes on the part of the
Executive fraud or
dishonesty
toward the
Company; provided, however, that
"Breach of
Duty" shall not include the Executive's lack of professional
qualifications. For
purposes of this
Agreement, an act, or
failure to act, on
the Executive's part shall be considered "willful" only if done, or
omitted, by
him not in good faith and without reasonable belief that his action
or omission
was in the best interest of the Company. The Executive's employment
shall not be
deemed to have been
terminated for "Breach
of Duty" unless the
Company shall
have given or delivered to the Executive (A) reasonable notice
setting forth the
reasons for the Company's intention to terminate the Executive's
employment for
"Breach of Duty"; (B)
a reasonable
opportunity, at any
time during the 30-day
period after the Executive's receipt of such notice, for the
Executive, together
with his counsel, to
be heard before the Board; and (C) a Notice of Termination
(as defined in Section 13 below) stating that, in the good faith
opinion of not
less than a majority of the entire membership of the Board, the Executive was
guilty of the conduct set forth in clauses (i) or (ii) of the first
sentence of
this Section 2(b).
(c)
"Cause" shall mean (i) the continued failure by the Executive to
perform his material
responsibilities and duties toward the Company (other than
any such failure
resulting from the
Executive's incapacity
due to physical or
mental illness);
(ii) the engaging by the Executive in willful or reckless
conduct that is demonstrably injurious to the Company
monetarily or
otherwise;
(iii) the Executive's conviction, entry of a plea of nolo contendere, or
admission of guilt,
for any felony or any
lesser crime if such
lesser crime
involves fraud or
dishonesty, moral
turpitude,
or any conduct that
adversely
affects the business
or reputation
of the Company, (iv) the commission or
omission of any
act by the
Executive that constitutes on the part of the
Executive fraud, dishonesty, or malfeasance, misfeasance, or
nonfeasance of duty
toward the Company; or
(v) any other action or conduct by the Executive that is
injurious to the Company, its business, or its reputation; provided, however,
that "Cause"
shall
not include the Executive's lack of professional
qualifications. For
purposes of this
Agreement, an act, or
failure to act, on
the Executive's part
shall be considered
"willful" or "reckless" only if done,
or omitted,
by him not in good
faith and without
reasonable
belief that his
action or omission was in the best interest of the Company.
(d)
"Change in
Control" shall mean a change in control of
a nature that
would be required to
be reported
in response to Item
6(e) of Schedule 14A
of
Regulation 14A
promulgated
under the Securities and Exchange Act of
1934, as
amended (the "Exchange Act"), whether or not the Company is then
subject to such
reporting requirements; provided that, without limitation,
a Change in
Control
shall be deemed to
have occurred
if (i) any
person (as such term is used in
section 13(d) and 14(d) of the Exchange Act) is or becomes
beneficial owner
(as
defined in Rule 13d-3
under the Exchange
Act), directly or indirectly, of
securities of the Company representing 30 percent or more of the
combined voting
power of the Company's then outstanding securities; or (ii) during
any period of
two consecutive years, the following persons (the "Continuing
Directors") cease
for any reason to
constitute a majority
of the Board:
individuals who at
the
beginning of such period constitute the Board and new directors
each of whose
election to the Board or nomination for election to the Board by the
Company's
security holders was
approved by a vote of at least two-thirds of the directors
then still in office who either were directors at the beginning of
the period or
whose election or nomination for election
<PAGE>
was previously so approved; or (iii) the security holders of the
Company approve
a merger or consolidation of the Company with any other
corporation, other
than
(A) a merger or consolidation that would result in the voting
securities of the
Company outstanding immediately before the merger or consolidation
continuing to
represent (either by
remaining outstanding
or by being
converted into
voting
securities of such surviving entity) a majority of the voting
securities of the
Company or of such surviving entity outstanding immediately after
such merger or
consolidation or (B) a
merger of consolidation that is approved by a Board
having a majority of its members persons who are Continuing
Directors, of
which
Continuing Directors
not less than
two-thirds
have approved the merger or
consolidation; or (iv)
the security
holders of the Company
approve a plan of
complete liquidation
of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company's
assets.
(e)
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
(f)
"Disability,"
for purposes of this Agreement, shall mean total
disability as defined in any long-term disability plan sponsored by the
Company
in which the Executive participates, or, if there is no such plan
or it does not
define such term, then Disability shall mean the physical or mental
incapacity
of the Executive that prevents the Executive from substantially performing the
duties of the office or position to which the Executive was elected
or appointed
by the Board for a period of at least 180 days, which incapacity is expected
to
be permanent and continuous through the Executive's 65th
birthday.
(g)
The "Change in Control
Date" shall be any date during the term of this
Agreement on which a
Change in Control
occurs.
Notwithstanding any
contrary
provision in this
Agreement,
if the Executive's employment or status as an
elected officer with
the Company is terminated by the Company within six months
before the date on
which a Change
in Control occurs, and it is reasonably
demonstrated that such
termination (i) was at
the request of a third party who
has taken steps reasonably calculated or intended to effect a
Change in Control
or (ii) otherwise
arose in connection with or anticipation of a Change in
Control, then for the
purposes of this
Agreement the "Change
in Control Date"
shall mean the date immediately before the date of such
termination.
(h)
"Good Reason" means:
(i)
the assignment to the
Executive within the
Protection
Period of any
duties inconsistent
in any respect with
the Executive's
position (including
status, offices,
titles and
reporting requirements, authority, duties, or
responsibilities), or
any other action that
results in a
diminution
in such
position, authority,
duties or
responsibilities, or
any action by the Company
that has a materially adverse effect on the conditions under which
the Executive
performs the
Executive's
day-to-day
responsibilities
and duties
toward the
Company, as compared to such conditions before the Change in
Control, excluding
for this purpose an isolated, insubstantial, and inadvertent
action that is not
taken in bad faith and is remedied by the Company promptly after receipt of
notice given by the Executive;
(ii)
a reduction by the
Company in the
Executive's base
salary in effect
immediately before the
beginning of the Protection Period or as increased from
time to time after the beginning of the Protection Period;
<PAGE>
(iii) a failure by the
Company to maintain
plans providing benefits at
least as beneficial
as those provided by any benefit or compensation plan
(including, without
limitation, any incentive compensation plan, bonus plan, or
program, retirement,
pension or savings
plan, life insurance plan, health and
dental plan,
or disability plan) in which the Executive is participating
immediately before the beginning of the Protection Period or any
action taken by
the Company that would
adversely affect the
Executive's
participation in,
or
reduce the
Executive's
opportunity
to benefit under, any of such plans or
deprive the Executive of any material fringe benefit enjoyed by him
immediately
before the
beginning of the Protection Period; provided, however, that a
reduction in benefits under the Company's tax-qualified retirement,
pension, or
savings plans or its life insurance plan, health and dental plan,
disability
plans, or other insurance plans, which reduction applies generally to
participants in the plans shall not constitute "Good Reason" for termination
by
the Executive;
(iv)
the Company's requiring the Executive, without the Executive's
written
consent, to be based
at any office or
location in excess of
50 miles from his
office location
immediately
before the
beginning of the
Protection
Period,
except for travel
reasonably required in
the performance
of the Executive's
responsibilities;
(v)
any purported termination by the Company of the Executive's
employment
for Breach
of Duty otherwise than as referred to in Section 2(b) of this
Agreement; or
(vi)
any failure by the Company to obtain the assumption of the
obligations
contained in this
Agreement by any successor as contemplated in Section 12 of
this Agreement.
(i)
"Parent" means any
entity that directly or indirectly through one or
more other
entities owns or controls more than 50 percent of the voting
securities or shares of beneficial interest of the Company.
(j)
"Protection Period" means the period beginning on the Change in
Control
Date and ending on the last day of the 18-calendar month following
the Change in
Control Date.
(k)
"Subsidiary"
means a company 50 percent or more of the voting
securities of which are owned, directly or indirectly, by the
Company.
3.
Termination Without Cause, not During the Protection Period.
Should the
Company terminate
the Executive's employment without Cause (as defined in
Section 2(c)),
other than during the
Protection
Period described in Section
2(j), the Company shall pay the amount described in Section 3(a) to the
Executive and,
provided the
Executive signs and does not revoke a waiver
and
release agreement as
described in Section 3(c), the Company shall also pay the
amount described in Section 3(b):
(a)
The Executive's
base salary and
vacation pay (for vacation not taken)
accrued but unpaid through the date of termination of employment,
to be paid in
cash upon the customary pay date.
<PAGE>
(b)
A lump sum severance
payment in an amount
equal to the product of 1.5
times the Executive's Average Annual Compensation as of the date of
termination,
to be paid in cash within 30 days of the date of termination,
except as required
in Section 7.
(c)
As a condition of the receipt of the amount described in Section 3(b),
the Executive
shall execute a waiver and release agreement, in a form
satisfactory to the
Company and by the
time specified
by the Company, that
releases the Company
and all affiliates
from any and all
claims of any nature
whatsoever, including,
without limit, any and
all statutory claims,
and shall
not revoke the waiver and release within any revocation
period required by law
or permitted by the Company.
4.
Death During Employment. Should the Executive die while
employed by the
Company, the Company shall pay the following amounts to the
Executive's estate:
(a)
The Executive's
base salary and
vacation pay (for vacation not taken)
accrued but unpaid through the date of the Executive's death.
(b)
A lump sum death benefit in an amount equal to the Executive's
Average
Annual Compensation
as of the date of
death, to be paid in cash within 60 days
of death.
5.
Disability. During the
first 90 days of a Disability, the Company shall
continue to pay the Executive's salary.
6.
Benefits upon Termination under Certain Circumstances During the
Protection Period.
If the Executive's
employment is
terminated by the Company
during the Protection
Period other than for
Breach of Duty or
Disability and
other than as a result of the Executive's death, or if the
Executive
terminates
his employment during the Protection Period for Good Reason,
the Company shall,
subject to Section 7, pay to the Executive in a lump sum in cash
within ten days
after the date of termination the aggregate of the following
amounts and shall
provide the following benefits:
(a)
The Executive's
base salary and
vacation pay (for vacation not taken)
accrued but unpaid through the date of termination of employment;
and
(b)
A lump sum severance
payment in an amount
equal to the product of 1.5
times the Executive's
Average Annual
Compensation as of the Change in Control;
and
(c)
Within 30 days of the date of termination of employment, upon
surrender
by the Executive of
the outstanding
options to purchase
shares of
beneficial
interest of the
Company ("Shares of Ben
