Exhibit 10.13
EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT (the " Agreement ") is made
effective as of October 23, 2006 (the " Effective
Date ") by and between Douglas Emmett, Inc. (the "
Company "), Douglas Emmett Properties, LP (the "
Partnership "), and William Kamer ("
Executive ") with respect to the following facts and
circumstances:
WHEREAS,
the Company desires to engage Executive as the Chief Financial
Officer of the Company, during the Agreement Term (as defined
below), on the terms and conditions and for the consideration set
forth herein.
NOW,
THEREFORE, in consideration of the premises and mutual covenants
herein and for other good and valuable consideration, the parties
agree as follows:
1.
Effectiveness; Term of
Employment . Subject to the
provisions of Section 8 of this Agreement, Executive shall be
employed by the Company on the terms and subject to the conditions
set forth in this Agreement for a period commencing on the
Effective Date and ending on December 31, 2010. Commencing on
January 1, 2011 and on each January 1 thereafter (each an
" Extension Date "), the Agreement Term shall be
automatically extended for an additional one-year period unless
either the Company or Executive provides the other party hereto
sixty (60) days' prior written notice before the next
Extension Date that the Agreement Term shall not be so extended
(the " Agreement Term ").
2.
Position; Duties
. During the Agreement Term, Executive shall
serve as Chief Financial Officer of the Company and the
Partnership. In such position, Executive shall have such duties and
authority commensurate with such position as shall be determined
from time to time by the Board of Directors of the Company (the "
Board ") including such duties and responsibilities
with respect to any subsidiary, affiliate or joint venture of the
Company (each a " Subsidiary "). Executive's duties
will be principally performed at the Company's headquarters, which
will be located within the West Side of Los Angeles, with such
travel as may be required to perform his duties hereunder as
reasonably requested by the Company.
3.
Base Salary
. During the Agreement Term, the Company
shall pay Executive a base salary at the annual rate of $575,000,
payable in regular installments in accordance with the Company's
usual payment practices. Executive's salary shall be reviewed at
least annually by the Compensation Committee of the Board (the "
Committee ") and Executive shall be entitled to such
increases in Executive's base salary, if any, as may be determined
from time to time in the sole and absolute discretion of the
Committee. Executive's annual base salary, as in effect from time
to time, is hereinafter referred to as the " Base
Salary ."
4.
Annual Bonus
. With respect to each full fiscal year
commencing during the Agreement Term, Executive shall be eligible
to earn an annual bonus award (the " Annual Bonus ")
based upon reasonable criteria to be reasonably established not
later than the first thirty (30) days of that fiscal year by
the Compensation Committee of the Board in consultation with
Executive. The amount of the bonus shall equal the following
percentages of Executive's Base Salary during that fiscal
year:
|
Threshold
|
|
Target
|
|
Superior
|
|
Outperformance
|
|
50%
|
|
80%
|
|
100%
|
|
120%
|
Unless
otherwise approved by the Board in its discretion, no bonus will be
payable to Executive for any year if Executive does not meet the
Threshold criteria established for that year. The Company will pay
any Annual Bonus earned by Executive with respect to a given fiscal
year in accordance with the terms and conditions of the Company's
annual bonus plan, but no later than the earlier of (i) the
fifteenth day of the third month following the end of such fiscal
year or (ii) the date that other senior executives are paid
similar bonuses.
5.
Long-Term Incentive
Compensation .
5.1.
Option Award
. As of the Effective Date, Executive shall
be granted an option to purchase 386,667 shares of Company stock
(the " Option Award ") pursuant to a separate written
Non Qualified Stock Option Agreement under the Company's 2006
Omnibus Stock Incentive Plan (the " Plan "). The
Option Award shall be subject to the terms and conditions of that
agreement and the Plan.
5.2.
LTIP Award
. As of the Effective Date, Executive shall
be granted 101,500 LTIP Units (the " LTIP Award ")
pursuant to a separate written LTIP Unit Award Agreement under the
Plan. The LTIP Award shall be subject to the terms and conditions
of that agreement and the Plan.
6.
Employee Benefits
. During the Agreement Term, Executive shall
be entitled to participate in the Company's employee welfare and
retirement benefit plans and perquisite programs as in effect, and
subject to such modification as the Company may determine necessary
or appropriate, from time to time (collectively " Employee
Benefits "), on the same basis as those benefits are
generally made available to other senior executives of the Company,
plus (i) $1,200 per month for the purchase of health insurance
benefits during any period in which he is not participating in the
Company's health plan and (ii) a car allowance of $500 per
month. During the Agreement Term, Executive
shall have the right (i) to participate in any future
compensation plans implemented for executives of the Company on a
basis commensurate with his position and (ii) to be
indemnified by the Company for all actions taken as an officer,
director or agent of the Company or its Subsidiaries to the full
extent provided under law or pursuant to the Indemnification
Agreement of even date herewith. Subject to the policies and
procedures of the Company, in addition to any accrued personal time
off (" PTO ") accrued with respect to service to the
predecessors of the Company, Executive shall be entitled to accrue
twenty five (25) paid days of PTO per year during the
Agreement Term.
7.
Business Expenses
. During the Agreement Term, the Company
shall reimburse Executive for all reasonable business expenses
incurred by Executive in the performance of Executive's duties
hereunder in accordance with the Company's policies as in effect
from time to time.
8.
Termination
. Notwithstanding any other provision of
this Agreement, the provisions of this Section 8 shall
exclusively govern Executive's rights upon termination of
employment with the Company. Following Executive's termination of
employment, except as set forth in this Section 8, Executive
(and Executive's legal representative and estate) shall have no
further rights to any compensation or any other benefits under this
Agreement.
8.1.
Definitions
.
"
Accrued Rights " means the sum of the following:
(i) any accrued but unpaid Base Salary through the date of
termination; (ii) a payment in respect of all unpaid, but
accrued and unused PTO through the date of termination;
(iii) any Annual Bonus earned but unpaid as of the date of
termination for any previously completed fiscal year ( i.e.,
not for the year of employment termination);
(iv) reimbursement for any unreimbursed business expenses
properly incurred by Executive in accordance with Company policy
through the date of termination; (v) such rights, if any,
under the Option Award, the LTIP Award and other compensation
programs and Employee Benefits to which Executive may be entitled
upon termination of employment according to the documents governing
such benefits; and (vi) any existing rights to indemnification
for prior acts through the date of termination.
"
Cause " means any of the following: (i) any act
or omission by Executive which constitutes intentional misconduct
or a willful violation of law; (ii) an act of fraud,
conversion, misappropriation or embezzlement by Executive or
conviction of, indictment for (or its procedural equivalent) or
entering a guilty plea or plea of no contest with respect to a
felony, the equivalent thereof or any crime involving any moral
turpitude with respect to which imprisonment is a common
punishment; or (iii) any other failure (other than any failure
resulting from incapacity due to physical or mental illness) by
Executive to perform his material and reasonable duties and
responsibilities as an employee, director or consultant of the Company or any Subsidiary
which continues for ten (10) days following written notice
from the Company or any Subsidiary (except in the case of a willful
failure to perform his duties or a willful breach, which shall
require no notice). For purposes of the foregoing sentence, no act,
or failure to act, on Executive's part shall be considered
"willful" unless the Executive acted, or failed to act, in bad
faith or without reasonable belief that his act or failure to act
was in the best interest of the Company or any
Subsidiary.
"
Change of Control " shall be deemed to have occurred
if
(i) there
shall be consummated (a) any consolidation or merger of the
Company, other than a merger or consolidation of the Company in
which (1) the holders of the Company's common stock
immediately prior to the merger or consolidation have at least
fifty one percent (51%) ownership of the total voting power of the
surviving entity immediately after the merger or consolidation, and
(2) no person (other than an Exempted Holder as defined below)
beneficially owns (as such term is defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, 20% or more of the total
voting power of the surviving entity or (b) any sale, lease,
exchange or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, of the assets
of the Company, or
(ii) the
shareholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company, or
(iii) any
person (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the " Exchange
Act ")) other than an Exempted Holder (as defined below)
shall become the beneficial owner (within the meaning of
Rule 13d-3 under the Exchange Act) of twenty percent (20%) or
more of the Company's common stock. " Exempted Holder
" means (a) the Company or any majority-owned Subsidiary (
provided that this exclusion applies solely to the ownership
levels of the Company or the majority-owned Subsidiary);
(b) any trustee, fiduciary or other person or entity holding
securities under any employee benefit plan or trust sponsored or
maintained by the Company or any Subsidiary; (c) any
underwriter or placement agent temporarily holding securities
pursuant to an offering of such securities; or (d) Dan Emmett,
Jordan Kaplan or Ken Panzer, their immediate family members and
family trusts or family-only partnerships and any charitable
foundations, any entities in which they and their families
beneficially own a majority of the voting interests, and any
"group" (as described in Rule 13d-5(b)(i) under the
Exchange Act) including them. However, a Change in Control shall
not be deemed to have occurred if a person's percentage interest
increases over twenty percent (20%) solely as a result of a
decrease in the outstanding stock because of an acquisition of
securities by the Company; provided , however , that
a "Change in Control" shall be deemed to have occurred on any
subsequent acquisitions of the Company's common stock by that
person (other than pursuant to a stock split, stock dividend, or
similar transaction) at a time when that person beneficially owns
twenty percent (20%) or more of the Company's outstanding common
stock, or
(iv) the
Board shall cease for any reason to have a majority of Uncontested
Directors. " Uncontested Directors " means directors
who were initially elected or initially nominated (a) by a
vote of at least two-thirds of the then Uncontested Directors and
(b) not as a result of an actual or threatened election
contest with respect to directors or as a result of any other
actual or threatened solicitation of proxies or consents by or on
behalf of any person other than the Board, including by reason of
agreement intended to avoid or settle any such actual or threatened
contest or solicitation.
"
Disability " means physical or mental incapacity
whereby Executive is unable with or without reasonable
accommodation for a period of six (6) consecutive months or
for an aggregate of nine (9) months in any twenty-four
(24) consecutive month period to perform the essential
functions of Executive's duties.
"
Good Reason " shall be present where Executive gives
notice to the Board of his voluntary resignation (a) within
one hundred and twenty (120) days after the occurrence of any
of the following, without Executive's written consent: (i) the
failure of the Company to pay or cause to be paid Executive's Base
Salary or Annual Bonus, when due hereunder, subject to a ten
(10) day cure period by the Company (except in the case of a
willful failure which shall require no notice);
(ii) diminution in Executive's status, including, title,
position, duties, authority or responsibility, subject to a thirty
(30) day cure period by the Company (except in the case of a
willful breach, which shall require no notice);
(iii) relocation of the Company's executive offices to a
location outside of the West Side of Los Angeles; or (iv) the
failure of the Company to obtain the express written assumption of
this Agreement pursuant to Section 11.5 hereof (unless such
Agreement is assumed by operation of law); (b) within eighteen
(18) months after the occurrence of a Change of
Control.
8.2.
Termination by the Company for Cause
or By Executive's Resignation without Good Reason
. The Agreement Term and Executive's
employment hereunder may be terminated by the Company for Cause and
shall terminate upon Executive's resignation without Good Reason,
and in either case Executive shall be entitled to receive only his
Accrued Rights.
8.3.
Death/Disability
. The Agreement Term and Executive's
employment hereunder shall terminate upon Executive's death or
Disability. Upon termination of Executive's employment hereunder
due to death or Disability, Executive's legal representative or
estate (as the case may be) shall be entitled to receive
(i) the Accrued Rights plus (ii) an amount equal
to a pro-rated portion of the Annual Bonus Executive otherwise
would have been paid for the fiscal year in which such termination
of employment occurs, payable when the Annual Bonus would otherwise
have been paid to Executive pursuant to Section 4, based upon
(a) actual performance for such fiscal year, as determined at
the end of such fiscal year and (b) the percentage of such
fiscal year that shall have elapsed through the date of Executive's
termination of employment; plus (iii) continued medical
benefits for Executive and Executive's spouse and eligible
dependents who at the time of Executive's termination are enrolled
in the Company's medical plan. Such benefits shall be substantially
identical to the
benefits maintained for other senior executives
of the Company and shall be provided for a period of twelve
(12) months following Executive's termination of employment.
Executive acknowledges that such benefit continuation is intended,
and shall be deemed, to satisfy the obligations of the Company and
any of its subsidiaries and affiliates to provide continuation of
benefits under Section 4980B of the Internal Revenue Code of
1986, as amended (" COBRA ") for such period and that
the Company may satisfy such obligation by paying any applicable
COBRA premiums.
8.4.
Termination by the Company without
Cause or Resignation by Executive for Good Reason
. The Agreement Term and Executive's
employment hereunder may be terminated by the Company without Cause
at any time and for any reason or by Executive's resignation for
Good Reason at any time upon thirty (30) days written notice
by the terminating party, although the Company may waive services
during that period. If Executive's employment is terminated by the
Company without Cause (other than by reason of death or Disability)
or if Executive resigns for Good Reason, Executive shall be
entitled to receive (i) the Accrued Rights, plus
(ii) provided that Executive first executes and returns to the
Company (and does not revoke) a release of all claims that is in
form and substance reasonably satisfactory to the Company, and
subject to Executive's continued compliance with the provisions of
Section 9 of this Agreement (to the extent expressly
applicable after the Agreement Term):
8.4.1. an
amount, payable in a lump sum without discount within 30 days
of the date of termination, equal to two (2) times the average
of Executive's compensation over the last three full calendar years
ending prior to the termination date including (i) the Base
Salary; (ii) the Annual Bonus and (iii) the value (based
on a Black Scholes formula in the case of options and value of the
underlying grants in the case of LTIP or outperformance plans) of
any equity (including stock, LTIPs and options) or other
compensation plans granted or awarded to Executive. In the event
that there are less than three full calendar years completed after
the execution of this Agreement, the
average shall be based on (i) 2006 (including compensation
paid by the predecessor of the Company) and (ii) any other
full completed years prior to the date of
termination.
8.4.2. continued
medical and dental benefits for Executive, Executive's spouse and
Executive's eligible dependents, who at the time of Executive's
termination are enrolled in the Company's benefits plans provided
for a period of two (2) years following Executive's
termination of employment. Such benefits shall be substantially
identical to the benefits maintained for other senior executives of
the Company. Executive acknowledges that such benefit continuation
is intended, and shall be deemed, to satisfy the obligations of the
Company and any of its subsidiaries and affiliates to provide
continuation of benefits under COBRA for such period and that the
Company may satisfy such obligation by paying any applicable COBRA
premiums or causing such premiums to be paid.
8.5.
Notice of Termination
. Any purported termination of employment by
the Company or by Executive (other than due to Executive's death)
shall be communicated by written notice to the other party, which
indicates the specific termination provision in this Agreement
relied upon and sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
employment under the provision so indicated and the date of
employment termination.
8.6.
Employee Termination and Officer
Resignation . Upon termination of
Executive's employment for any reason, Executive's employment with
each of the Company and each Subsidiary shall be terminated and
Executive shall be deemed to resign, as of the date of such
termination and to the extent applicable, as an officer of the
Company and any Subsidiary. Executive shall confirm such
resignation(s) in writing to the Company.
9.
Covenants
.
9.1.
Confidentiality
. Executive acknowledges that, in his
employment hereunder, he will occupy a position of trust and
confidence with the Company and its Subsidiaries. Executive agrees
that Executive shall not during the Agreement Term and for two
(2) years thereafter, except (i) as may be required to
perform his duties hereunder or as required by applicable law or
(ii) until such information shall have become public other
than by Executive's unauthorized disclosure or (iii) with the
prior written consent of the Company, use, disclose or disseminate
any trade secrets, confidential information or any other
information of a secret, proprietary, confidential or generally
undisclosed nature relating to the Company and/or any Subsidiary,
or their respective businesses, contracts, projects, proposed
projects, revenues, costs, operations, methods or
procedures.
9.2.
Non-solicitation
. Executive agrees that, for a period of one
(1) year immediately following the end of Executive's
employment with the Company, except acting on behalf of the Company
during the Employment Term, Executive shall not, either directly or
indirectly, solicit or parti
