EXHIBIT 99.1
AMENDED AND RESTATED
EMPLOYMENT AND CONSULTING AGREEMENT
This Employment and Consulting Agreement (the "Agreement"), which
is
amended and restated as of December 12, 2007, was originally
entered into as of
January 1, 2004 (the "Effective Date"), by and between Jeffrey F.
Joseph,
residing at 19 Stillman Lane, Pleasantville, New York 10570
("Executive") and
PRESIDENTIAL REALTY CORPORATION, a Delaware corporation having
offices at 180
South Broadway, White Plains, New York 10605 (the "Company") and
subsequently
amended as of January 3, 2006;
W I T N E S S E T H:
WHEREAS, Company is desirous of employing Executive as its
President
and Chief Executive Officer; and
WHEREAS, Executive desires to render such services to Company.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein set forth, the parties hereto agree as
follows:
1. Employment. Company hereby employs Executive as its President
and
Chief Executive Officer and Executive hereby accepts such
employment, upon the
terms and conditions hereinafter set forth.
2. Duties.
(a) In his capacity as President and Chief Executive Officer of
Company during the Employment Term, the Executive shall perform for
Company the
executive, administrative and technical duties customarily
associated with such
positions, as well as such other duties reasonably consistent
therewith as may
be reasonably assigned to Executive from time to time by the Board
of Directors
of Company; provided, however, that the duties assigned shall be of
a character
and dignity appropriate to a senior executive of a corporation and
consistent
with Executive's experience, education and background.
(b) Except as otherwise set forth in this paragraph, during the
Employment Term the (i) Executive shall devote his full time and
efforts during
normal business days and hours to the performance of this
Agreement; and (ii)
Executive shall not engage in the real estate business or in any
other business
which conflicts with or competes in any material way with the
business of
Company. Notwithstanding the foregoing, Executive may devote such
time and
efforts to winding up the business of Ivy Properties Ltd. and its
affiliates
(collectively, "Ivy") as Executive deems reasonably necessary, so
long as the
devotion of such time and effort does not conflict or interfere
with Executive's
performance of his duties as President and Chief Executive Officer
of Company
and in fact Executive does diligently perform his duties as
President and Chief
Executive Officer of Company to the satisfaction of the Board of
Directors of
Company.
(c) During the Consulting Term, Executive will be engaged by
Company
as a consultant to render to Company such consulting services as
may be
reasonably assigned to him from time to time by the Board of
Directors of
Company, or by the Executive Committee of Company, provided that
such services
are of a type, dignity and nature appropriate to the former
President and Chief
Executive of Company and further provided that: (i) such consulting
services
shall be required to be rendered by him only in White Plains, New
York or such
other location in the United States designated by Executive; (ii)
Executive's
inability to act as such consultant by reason of illness,
disability or lack of
capacity shall not be deemed a breach of this Agreement; and (iii)
such services
shall not be detrimental or injurious to Executive's health. It is
further
agreed that such services shall not require more than sixty (60)
hours service
during any month; that Executive's unavailability at any particular
time shall
not constitute a breach of this Agreement; such services may be
rendered by
telephone, mail or other means of communication; and that
Executive's failure to
render such services because of his absence from White Plains, New
York or such
other location in the United States designated by Executive shall
not be deemed
a breach of this Agreement.
3. Term.
(a) The employment term ("Employment Term") of this Agreement
shall
commence on the Effective Date and shall continue until the
earliest of (i)
three years after notice from Company to Executive terminating the
Employment
Term, (ii) Company ceasing to do business as a result of it having
been finally
declared bankrupt or insolvent by a court of competent jurisdiction
in
accordance with Treasury Regulation Section
1.409A-3(j)(4)(ix)(A)
("Bankruptcy"), (iii) December 31, 2011, or (iv) upon Executive
providing a
level of services that has permanently decreased to below twenty
five percent
(25%) of the average level of services performed over the
immediately preceding
twelve (12) months in accordance with Treasury Regulation Section
1.409A-1(h)(1)
(ii) (a "Separation from Service"). The consulting term
("Consulting Term") of
this Agreement shall be the three-year period commencing on the
termination of
the Employment Term for any reason other than for cause,
Executive's voluntary
resignation pursuant to Section 11(e), Executive's death,
Executive's Permanent
Disability or Company's Bankruptcy. The Consulting Term shall
terminate in the
event of Executive's discharge for cause, voluntary resignation,
death or
Permanent Disability, or Company's Bankruptcy. The term ("Term") of
this
Agreement shall be for the full Employment Term and Consulting
Term.
(b) This Agreement may be terminated at any time by Company for
"cause," as defined herein. For the purpose of this Agreement,
termination of
Executive's employment or engagement shall be deemed to have been
for "cause"
only if termination of his employment or engagement, as the case
may be, shall
have been the result of (i) the conviction of Executive of any
crime
constituting a felony or any other crime involving moral turpitude,
(ii)
Executive's willful refusal to follow a reasonable direction of the
Board of
Directors of Company after written notice that such continued
refusal shall
result in termination of his employment or engagement as a
consultant, for
cause; (iii) Executive's failure to fulfill his employment duties
hereunder as
is required by Section 2(b) above after written notice that such
continued
failure shall result in termination of his employment for cause; or
(iv)
Executive's failure to fulfill his consulting duties hereunder as
is required by
and subject to the provisions set forth in Section 2(c) above after
written
notice that such continued failure shall result in termination of
his consulting
services for cause.
(c) This Agreement may also be terminated by Company as set forth
in
Section 11 or Section 13 below.
4.
Compensation and Fees.
(a) During the Employment Term, Company shall pay to Executive
in
consideration of the services to be rendered hereunder compensation
in the form
of a salary:
(i) for the period beginning on the Effective Date and ending
on
December 31, 2004, at the annual rate of Two Hundred Ninety-Nine
Thousand Seven
Hundred Fifty-Nine and 85/100 ($299,759.85) Dollars; and
(ii) for the calendar year beginning on January 1, 2005, and
for
every calendar year thereafter commencing during the Employment
Term of this
Agreement, in an amount equal to the salary paid for the previous
calendar year
times the lesser of (i) 1.05 and (ii) the Cost of Living Adjustment
Factor
(as hereinafter defined);
The salary for
all such periods shall be prorated if any partial
calendar year is involved and shall be paid less appropriate
deductions, if any,
for federal, state and city income taxes, FICA contributions,
N.Y.S. disability
and any other deductions required by law.
The Cost of Living Adjustment Factor as it is applied in
calculating
compensation payable to Executive for any period referred to above
(and
retirement compensation payable to Executive for any period
described in Section
12 below) shall be the sum of (x) one (1) plus (y) a fraction (A)
which has as
its numerator the amount, if any, by which the Revised Consumer
Price Index for
Urban Wage Earners and Clerical Workers for the New York-Northern
New Jersey
area (1982-84=100), published by the U.S. Department of Labor
Statistics (the
"Index") for the last calendar month preceding the commencement of
such period
(which will be December in each case of annual salary described in
this Section
4) (the "Increase Index Month") exceeds the Index for the calendar
month
occurring one year prior to the Increase Index Month (the "Base
Index Month"),
and (B) which has as its denominator the Index for the Base Index
Month.
In the event that the Index is converted to a different
standard
reference base or otherwise revised, the determination of increased
compensation
under this Section 4 and/or retirement compensation under Section
12 shall be
made with the use of such conversion factor, formula or table for
converting the
Index as may be published by the Bureau of Labor Statistics or, if
said Bureau
shall not publish the same, then with the use of such conversion
factor, formula
or table as may be published by Prentice-Hall, Inc., or any other
nationally
recognized publisher of similar statistical information. If the
Index ceases to
be published, and there is no successor thereto, such other index
as Executive
and Company shall agree upon in writing shall be substituted for
the Index. If
Executive and Company are unable to agree as to such substituted
index, such
substituted index shall be that determined by arbitration in
accordance with the
procedures of the American Arbitration Association.
In the event that the Index is not available for any month provided
for
above, the next available Index shall be used instead, and if the
next available
index is available following a payment for which an adjustment
should have been,
then a retroactive adjustment shall also be made.
(iii) Executive's compensation shall be payable in equal
installments in arrears, in the same frequency as other senior
officers of
Company are paid, but in any event not less frequent than
twenty-six (26)
bi-weekly installments.
(b) As compensation for Executive's services during the
Consulting
Term, Company shall pay consulting fees at the annual rate of 50%
of the salary
which was in effect under Section 4(a)(ii) on the day preceding the
commencement
of the Consulting Term plus the Cost of Living Adjustment Factor as
provided in
Section 4(a)(ii), less any deductions required by law. Such fees
shall be
payable in equal installments in arrears, in the same frequency as
senior
officers of Company are paid, but in any event not less frequently
than
twenty-six (26) biweekly installments. Such fees for the second and
third years
of the Consulting Term shall likewise be adjusted for the Cost of
Living
Adjustment Factor as provided in Section 4(a)(ii).
5. Indemnification. The Indemnification Agreements previously
executed
by Executive and Company shall remain in full force and effect
during the Term
of this Agreement including the Employment Term and the Consulting
Term.
6. Vacations. Executive shall be entitled during the Employment
Term of
this Agreement to four weeks vacation annually at full
compensation.
7. Fringe Benefits.
(a) During the Employment Term of this Agreement, Executive shall
be
entitled to the extent permitted by applicable law and the
applicable plans and
agreements providing the benefits, at Company's expense, to
participate in (a)
the following benefit programs which Company now maintains for its
employees:
(i) its Defined Benefit Pension Plan, (ii) its Section 125
cafeteria plan, (iii)
its Section 401 (k) plan if any, (iv) its health insurance plan for
employees
only, (v) its disability insurance plan, and (vi) its group life
insurance plan;
and (b) all benefit programs that Company hereafter establishes and
makes
available to either employees in general or to other senior
executive management
(without intending to provide duplicate coverage to Executive if
Company makes
such available to both employees in general and to senior executive
management).
(b) During the Consulting Term Executive shall be entitled to
the
extent permitted by applicable law and the applicable plans and
agreements
providing the benefits, at Company's expense, to participate in the
following
benefit programs which Company now maintains to the extent
available for its
consultants: (i) its health insurance plans; (ii) its disability
insurance
plans; and (iii) its group life insurance plans.
(c) If obtainable during the Term and at Executive's option and,
if
exercised, at Executive's sole cost and expense, Company shall
include
Executive's spouse and children under the health insurance plan
maintained by
Company for Executive.
(d) In addition, during the Employment Term of this Agreement, (i)
Company shall
also pay for the premiums on Executive's existing life insurance
policy up to a
maximum of $15,250 per annum and (ii) Company shall pay and be
responsible for
all costs of ownership attributable to the automobile which Company
currently
owns and provides Executive for its use, and for any replacement
automobile
leased or purchased by Company pursuant to Section 9 below.
(e) In addition, during the Term and subject to Executive
providing
proper documentation, Company shall reimburse Executive for
reasonable travel,
entertainment and other expenses incurred by Executive in providing
services
hereunder on behalf of Company, including pre-approved expenses
during the
Consulting Term.
(f) Following any termination of the Employment Term, to the
extent
permitted by law and the party providing such benefits, Executive
may, at his
sole cost and expense, continue any fringe benefits, if obtainable,
then being
provided to Executive which are not provided by Company during the
Consulting
Term under (b) above.
8. Bonus.
(a) Subject to paragraph (b) of this Section 8, in addition to
the
compensation set forth above, Executive shall be entitled to a
bonus payable
with respect to each calendar year occurring during the Employment
Term of this
Agreement (for purposes of this Section 8 each a "Bonus Year") in
an amount
equal to 10% of the product of (i) the amount by which the Per
Share Net Cash
From Operations (as hereinafter defined) for such Bonus Year
exceeds $.57 per
share for calendar years 2004, 2005 and 2006, $.60 per share for
calendar years
2007, 2008 and 2009, and $.63 per share for calendar years 2010 and
2011 to the
extent any aforesaid year is a Bonus Year and (ii) the number of
shares
outstanding at the end of such Bonus Year. Notwithstanding the
foregoing, the
bonus in any Bonus Year shall not exceed 33 1/3% of the salary
compensation set
forth in Section 4 for such year (prorated if any partial year is
involved or
prorated through the date of any merger of Company or the sale or
liquidation
of all or substantially all of its assets, as the case may be). The
term Per
Share Net Cash from operations shall mean the Net Income for such
Bonus Year
(as shown on Company's Audited Financial Statements), with the
following
adjustments, divided by the number of shares outstanding at the end
of such
Bonus Year.
(i) the addition back of any extraordinary deductions to
income;
(ii) the addition back of depreciation of non-rental property,
depreciation on rental real estate and amortization of mortgage and
organization
costs;
(iii) with respect to the sales of property and investments,
including foreclosed property, recognized in any Bonus Year (x)
there shall be
deducted from net gain or loss, any discount or deferred gain, and
(y) any
depreciation taken on the sold property during the periods that it
was owned by
Company shall be added back before
