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AMENDED AND RESTATED EMPLOYMENT AGREEMENT

Employee Retention Agreement

AMENDED AND RESTATED EMPLOYMENT AGREEMENT | Document Parties: Developers Diversified Realty Corporation You are currently viewing:
This Employee Retention Agreement involves

Developers Diversified Realty Corporation

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Title: AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Governing Law: Ohio     Date: 2/27/2009
Industry: Real Estate Operations     Sector: Services

AMENDED AND RESTATED EMPLOYMENT AGREEMENT, Parties: developers diversified realty corporation
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Exhibit 10.26

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

               THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Employment Agreement”) is entered into as of the 29th day of December, 2008, between Developers Diversified Realty Corporation, an Ohio corporation (the “Company”), and David M. Jacobstein (the “Executive”).

WITNESSETH:

               WHEREAS, the Company desires to employ the Executive, and the Executive desires to be employed by the Company, on the terms and subject to the conditions set forth herein; and

               WHEREAS, the Company and the Executive desire for this Employment Agreement to amend and supersede any prior employment agreements between the Company and the Executive.

               NOW, THEREFORE, in consideration of the mutual promises herein contained, the parties agree as follows:

1.

 

Employment.

 

(a)

 

The Company hereby employs the Executive, and the Executive hereby accepts such employment, on the terms and subject to the conditions hereinafter set forth.

 

 

(b)

 

During the term of this Employment Agreement, the Executive shall be and have the titles given to him from time to time by the Chief Executive Officer of the Company and shall devote such part of his business time as may be reasonably necessary to perform diligently such duties as may be reasonably requested from time to time by the Chief Executive Officer or the Board of Directors of the Company (the “Board”); provided, however, that in no event shall the Executive be required to devote more than 20 hours per month to the performance of such duties.

 

2.

 

Term and Positions.

 

(a)

 

The period of employment of the Executive by the Company shall be deemed to have commenced on May 8, 2007 (the “Effective Date”) and shall, subject to earlier termination as provided in this Employment Agreement, continue until December 31, 2010. Notwithstanding the foregoing, this Employment Agreement may be terminated by the Company with “cause” (as hereinafter defined) at any time and without cause upon not less than ninety (90) days prior written notice to the Executive.

 

 

(b)

 

For service as an employee of the Company, the Executive shall be entitled to the full protection of the applicable indemnification provisions of the articles of incorporation and code of regulations of the Company, as the same may be amended from time to time.

 

 

(c)

 

If there occurs a material breach by the Company of any of its obligations under this Employment Agreement, which breach has not been cured in all material respects within thirty (30) days after the Executive gives notice thereof to the Company (such notice to be given within the 90-day period commencing on the date of such material breach), then

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in such event the Executive shall have the right to terminate his employment with the Company, but such termination shall not be considered a voluntary resignation or termination of such employment or of this Employment Agreement by the Executive but rather a discharge of the Executive by the Company without “cause” (as defined in Paragraph 5(a)(ii)).

 

 

(d)

 

Notwithstanding anything in this Agreement to the contrary, if there shall occur a “Change in Control” (as that term is defined in the Amended and Restated Change in Control Agreement, dated December 29, 2008, between the Company and the Executive (the “Change in Control Agreement”), payments to the Executive will be governed by the Change in Control Agreement and the Executive shall not be entitled to any additional benefits under this Employment Agreement except as to that portion of any unpaid salary and other benefits accrued and earned by him hereunder up to and including the effective date of the Change in Control. It is expressly understood that the foregoing shall have no effect upon the parties’ respective rights and obligations under Paragraph 5(e) of this Employment Agreement or the Performance Units Agreement dated January 2, 2002.

3.

 

Compensation.

 

 

 

During the term of this Employment Agreement, the Company shall pay or provide, as the case may be, to the Executive the compensation and other benefits and rights set forth in this Paragraph 3.

 

 

(a)

 

The Company shall pay to the Executive a base salary payable in accordance with the Company’s usual pay practices (and in any event no less frequently than monthly) of Six Hundred Thousand Dollars ($600,000) per annum.

 

 

(b)

 

The Company shall provide to the Executive such life, disability, medical, hospitalization, vision and dental insurance for himself, his spouse and eligible family members as may be in effect on the date hereof.

 

 

(c)

 

The Executive shall participate in all retirement and other benefit plans of the Company generally available from time to time to employees of the Company and for which the Executive qualifies under the terms thereof (and nothing in this Agreement shall or shall be deemed to in any way affect the Executive’s rights and benefits thereunder except as expressly provided herein).

 

 

(d)

 

The Executive shall be entitled to participate in any equity or other employee benefit plan that is generally available to senior executive officers, as distinguished from general management, of the Company. The Executive’s participation in and benefits under any such plan shall be on the terms and subject to the conditions specified in the governing documents of the particular plan. It is expressly understood and agreed that the intent of this Paragraph 3(d) is to permit such equity and other benefits granted or provided to the Executive prior to the Effective Date to continue to vest during the term of this Employment Agreement, to permit the Executive to exercise any vested options at any time during their full term regardless of whether that is during or after the term of this Employment Agreement and to permit the Executive to continue participation in the Company’s elective and equity deferred compensation plans during the term of this Employment Agreement, and that, subject to paragraph 5(e) of this Agreement, the Executive shall not be granted or provided with any additional equity or employee equity plan benefits during the term of this Employment Agreement.

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(e)

 

The Company shall reimburse the Executive or provide him with an expense allowance during the term of this Employment Agreement for travel, entertainment and other expenses reasonably and necessarily incurred by the Executive in connection with the Company’s business. The Executive shall furnish such documentation with respect to reimbursement to be paid hereunder as the Company shall reasonably request.

 

 

(f)

 

The Company shall provide to the Executive a new vehicle of the Executive’s choice for the exclusive use of the Executive, together with automobile, theft, casualty and liability insurance, and payment or reimbursement of the Executive for all maintenance, repair and gasoline.

 

 

(g)

 

The Company shall reimburse the Executive or provide him with an expense account during the term of this Employment Agreement of up to $5,000 per annum for financial planning, tax return and financial statement preparation services and shall reimburse the Executive for legal and related consulting fees (up to $5,000) related to the review of this Agreement.

4.

 

Payment in the Event of Death or Disability.

 

 

(a)

 

Except as otherwise provided in Paragraph 4(a)(i), in the event of the Executive’s death or if the Company terminates the Executive’s employment by reason of the Executive becoming “disabled” (as hereinafter defined) during the term of this Employment Agreement, the Company shall pay to the Executive (or his successors and assigns in the event of his death) an amount equal to the balance of the base salary payable to the Executive during the remaining term of this Agreement and shall continue the benefits described in Paragraph 3(b) for the Executive (except in the case of death) and the Executive’s family for a period of one (1) year.

 

(i)

 

The Company will not be obligated to pay or provide any of the amounts or benefits specified in Paragraph 4(a) unless either (A) the Company is deemed to have waived the obligation to provide a Release as provided in Paragraph 6(b) or (B) the Executive or the Executive’s personal representative has timely executed a Release as contemplated by Paragraph 6(c) and has not revoked such Release during any applicable revocation period.

 

 

(ii)

 

The Company will pay the balance of the base salary specified in Paragraph 4(a) during the seven-day period that follows whichever of the following is applicable: (A) the end of the 21-day period described in Paragraph 6(a) if the Company fails to present a Release and covering message to the Executive (or the Executive’s personal representative) within such 21-day period; or (B) the end of any revocation period applicable to the Release executed by the Executive as described in Paragraph 6 (provided that the Executive has not revoked the Release during such revocation period).

 

 

(b)

 

For purposes of this Employment Agreement, the Executive shall become “disabled” only in the event of a permanent disability, Executive’s “disability” shall be deemed to have occurred after one hundred twenty (120) days in the aggregate during any consecutive twelve (12) month period, or after ninety (90) consecutive days, during which one hundred twenty (120) or ninety (90) days, as the case may be, the Executive, by reason of his physical or mental disability or illness, shall have been unable to discharge his duties under this Employment Agreement. The date of disability shall be such one hundred twentieth (120th) or ninetieth (90th) day, as the case may be. In the

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event either the Company or the Executive, after receipt of notice of the Executive’s disability from the other, dispute that the Executive’s permanent disability shall have occurred, the Executive shall promptly submit to a physical examination by the chief of medicine of any major accredited hospital in the Cleveland, Ohio, area and, unless such physician shall issue his written statement to the effect that in his opinion, based on his diagnosis, the Executive is capable of resuming his employment and devoting his full time and energy to discharging his duties within thirty (30) days after the date of such statement, such permanent disability shall be deemed to have occurred.

5.

 

Termination.

 

 

(a)

 

The employment of the Executive under this Employment Agreement, and the terms hereof, may be terminated by the Company:

 

(i)

 

on the death of the Executive or if the Executive becomes disabled (as previously defined);

 

 

(ii)

 

for cause at any time by action of the Board. For purposes hereof, the term “cause” shall mean:

 

 

(A)

 

The Executive’s fraud, commission of a felony or of an act or series of acts which result in material injury to the business reputation of the Company, commission of an act or series of repeated acts of dishonesty which are materially inimical to the best interests of the Company, or the Executive’s willful and repeated failure to perform his duties under this Employment Agreement, which failure has not been cured within fifteen (15) days after the Company gives notice thereof to the Executive; or

 

 

(B)

 

The Executive’s material breach of any material provision of this Employment Agreement, which breach has not been cured in all substantial respects within ten (10) days after the Company gives notice thereof to the Executive; or

 

(iii)

 

without cause pursuant to written notice provided to the Executive not less than ninety (90) days in advance of the Termination Date.

 

 

 

 

The exercise by the Company of its rights of termination under this Paragraph 5 shall be the Company’s sole remedy if such right to terminate arises. Upon any termination of this Employment Agreement, the Executive shall be deemed to have resigned from all offices and directorships held by the Executive in the Company.

 

 

(b)

 

In the event of a termination claim by the Company to be for “cause” pursuant to Paragraph 5(a)(ii), the Executive shall have the right to have the justification for said termination determined by arbitration in Cleveland, Ohio. In order to exercise such right, the Executive shall serve on the Company within thirty (30) days after termination a written request for arbitration. The Company immediately shall request the appointment of an arbitrator by the American Arbitration Association and thereafter the question of “cause” shall be determined under the rules of the American Arbitration Association, and the decision of the arbitrator shall be final and binding upon both parties. The parties shall use all reasonable efforts to facilitate and expedite the arbitration and shall act to cause the arbitration to be completed as promptly as possible. During the pendency of the arbitration, the Executive shall continue to receive all compensation and benefits to

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which he is entitled hereunder, and if at any time during the pendency of such arbitration the Company fails to pay and provide all compensation and benefits to the Executive in a timely manner the Company shall be deemed to have automatically waived whatever rights it then may have had to terminate the Executive’s employment for cause. Expenses of the arbitration shall be borne equally by the parties except as otherwise determined by the arbitrator.

 

 

(c)

 

In the event of termination for any of the reasons set forth in subparagraph (a) of this Paragraph 5, except as otherwise provided in Paragraphs 3(d), 4(a) and 5(d), the Executive shall be entitled to no further compensation or other benefits under this Employment Agreement, except as to that portion of any unpaid salary and other benefits accrued and earned by him hereunder up to and including the effective date of such termination.

 

 

(d)

 

Except as provided in Paragraph 5(d)(i), in the event of the termination by the Company of the Executive without “cause” (other than as described in Paragraph 2(d), or in the event of a termination by the Executive for reasons set forth in Paragraph 2(c), the Company shall pay to the Executive an amount equal to the balance of the base salary payable to the Executive during the remaining term of this Agreement and shall continue the benefits described in Paragraph 3(b) during the remaining term of this Agreement.

 

(i)

 

The Company will not be obligated to pay or provide any of the amounts or benefits specified in Paragraph 5(d) unless either (A) the Company is deemed to have waived the obligation to provide a Release as provided in Paragraph 6(b) or (B) the Executive has timely executed a Release as contemplated by Paragraph 6(c) and has not revoked such Release during any applicable revocation period.

 

 

(ii)

 

The Company will pay the balance of the base salary specified in Paragraph 5(d) during the seven-day period that follows whichever of the following is applicable: (A) the end of the 21-day period described in Paragraph 6(a) if the Company fails to present a Release and covering message to the Executive (or the Executive’s personal representative) within such 21-day period; or (B) the end of any revocation period applicable to the Release executed by the Executive as described in Paragraph 6 (provided that the Executive has not revoked the Release during such revocation period).

 

 

(e)

 

Notwithstanding any provision to the contrary contained in this Employment Agreement, the Change in Control Agreement or any other agreement to which the Executive is a party or by which he is bound, concurrently with the termination of this Agreement for any reason other than “cause,” including, without limitation, natural termination on the date the term of this Agreement expires, all of the Executive’s restricted shares, options, performance units and other equity-based awards which by their respective terms are not vested at the time of such termination shall fully and immediately vest at such time.

 

 

(f)

 

For all purposes of this Employment Agreement, the term “Termination Date” means the date on which the Executive’s employment with the Company terminates.

6.

 

Release. This Paragraph 6 will apply only upon termination of the Executive’s employment (x) by reason of death or disability (as contemplated by Paragraph 4) or (y) by the Company without “cause” or by the Executive for reasons set forth in Paragraph 2(c) (as contemplated by Paragraph 5(d)).

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(a)

 

Presentation of Release by the Company. If this Paragraph 6 applies, the Company may present to the Executive (or in the case of the Executive’s death or legal incapacity, to the Executive’s personal representative), not later than 21 days after the Termination Date, a form of release (a “Release”) of all current and future claims, known or unknown, arising on or before the date on which the Release is to be executed, that the Executive or the Executive’s assigns have or may have against the Company or any subsidiary, and the directors, officers, and affiliates of any of them, in such form as may reasonably be presented by the Company together with a covering message


 
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