EXHIBIT 10.1
2007 AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This 2007 Employment Agreement (the "Agreement"), is made as of
February 6, 2007, effective as of March 1, 2007 by and between LTC
PROPERTIES,
INC., a corporation organized under the laws of the State of
Maryland ("LTC" or
the "Company"), and WENDY SIMPSON ("Executive") and amends and
restates the
Amended and Restated Employment Agreement between LTC and
Executive, effective
as of May 22, 2006 ("Prior Employment Agreement").
NOW, THEREFORE, for good and valuable consideration, the receipt
and
adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
1.
Effective Date, Appointment, Title and Duties. The effective date
of
this Agreement is March 1, 2007 ("Effective Date"). As of the
Effective Date,
LTC employs Executive to serve as its Chief Executive Officer. In
such capacity,
Executive shall report to the Board of Directors of the Company,
and shall have
such duties, powers and responsibilities as are customarily
assigned to a Chief
Executive Officer of a publicly held corporation, but shall also be
responsible
to the Board of Directors and to any committee thereof. In
addition, Executive
shall have such other duties and responsibilities as the Board of
Directors may
reasonably assign her, with her consent, including serving with the
consent or
at the request of the Board of Directors as an officer or on the
board of
directors of affiliated corporations, provided that such duties are
commensurate
with and customary for a senior executive officer bearing
Executive's
experience, qualifications, title and position.
2.
Term of Agreement. The term of this Agreement shall commence as of
the
Effective Date and shall extend such that at each and every moment
of time
hereafter the remaining term shall be three years.
3.
Acceptance of Position. Executive accepts the position of Chief
Executive Officer, and agrees that during the term of this
Agreement she will
faithfully perform her duties and, except as expressly approved by
the Board of
Directors of LTC, will devote substantially all of her business
time to the
business and affairs of LTC, and will not engage, for her own
account or for the
account of any other person or entity, in a business which competes
with LTC. It
is acknowledged and agreed that Executive may serve as an officer
and/or
director of companies in which LTC owns voting or non-voting stock.
In addition,
it is acknowledged and agreed that Executive may, from time to
time, serve as a
member of the board of directors of other companies, in which event
the Board of
Directors of LTC must expressly approve such service pursuant to a
Board
resolution maintained in the Company's minute books. Any
compensation or
remuneration which Executive receives in consideration of her
service on the
board of directors of other companies shall be the sole and
exclusive property
of Executive, and LTC shall have no right or entitlement at any
time to any such
compensation or remuneration.
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4.
Salary and Benefits. During the term of this Agreement:
(a) LTC shall pay to Executive a base salary at an annual rate of
not
less than Four Hundred Thousand Dollars ($400,000) per annum ("Base
Salary"),
paid in approximately equal installments at intervals based on any
reasonable
Company policy. LTC agrees from time to time to consider increases
in such base
salary in the discretion of the Board of Directors. Any increase,
once granted,
shall automatically amend this Agreement to provide that thereafter
Executive's
base salary shall not be less than the annual amount to which such
base salary
has been increased.
(b) During the term hereof, Executive shall participate in all
health,
retirement, Company-paid insurance, sick leave, disability,
expense
reimbursement and other benefit programs which LTC makes available
to any of its
senior executives.
(c) Health Insurance Benefits. LTC shall provide to Executive and
her
spouse LTC health insurance benefits, of a type and nature no less
favorable to
Executive than the health insurance benefits made available by LTC
to Executive
and to LTC's other senior executives at the time of execution of
this Agreement,
for so long as Executive is employed hereunder and continuing
thereafter for
Executive's lifetime. The benefits described in the preceding
sentence shall be
referred to herein as Executive's "Health Insurance Benefits".
(i) In the event LTC ceases to offer health insurance coverage
to
its senior executives or LTC elects in its sole discretion to
discontinue
providing Executive with Executive's Health Insurance Benefits, LTC
shall have
the option (a) at the Company's expense, to purchase health
insurance coverage
no less favorable to Executive than Executive's Health Insurance
Benefits, or
(b) terminate all further Health Insurance Benefits to Executive
and in lieu
thereof make a one time payment of Two Hundred Fifty Thousand
Dollars ($250,000)
to Executive (a "Health Insurance Buyout").
(ii) In order to effect a Health Insurance Buyout, LTC shall give
no
less than sixty (60) days' prior written notice to Executive that
LTC has
elected to terminate Executive's Health Insurance Benefits. Such
notice shall
not be effective nor shall it relieve LTC of its obligations under
this Section
4(c) unless it is accompanied by payment in full of the aforesaid
Two Hundred
Fifty Thousand Dollars ($250,000).
(iii) Executive's rights to the benefits set forth in this
Section
4(c) and the subsections of this Section 4(c) shall survive any
termination or
expiration of this Agreement and the termination of Executive's
employment,
regardless of whether such termination is by the Executive or by
the Company and
regardless of whether such termination is for any or no reason or
with or
without Good Reason or Cause.
(d) The Company has set an annual target bonus for Executive equal
to
one hundred percent (100%) of her Base Salary; provided, however,
that the award
of any such bonus is subject to the sole discretion of the Board of
Directors.
Executive also shall be eligible to participate in any LTC
incentive stock,
option or bonus plan offered by LTC to its senior executives,
subject to the
terms thereof and at the sole discretion of the Board of
Directors.
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(e) At the date hereof:
(i) Executive has previously been awarded twenty-seven thousand
one
hundred twenty (27,120) shares of the Company's common stock
("Prior RSA's").
Twenty-two thousand five hundred (22,500) of the Prior RSA's were
awarded under
the LTC Properties, Inc. 2004 Restricted Stock Plan ("2004 RSP")
and four
thousand six hundred twenty (4,620) of the Prior RSA's were awarded
under the
LTC Properties, Inc., 1998 Equity Participation Plan ("1998 EPP")
and the
applicable LTC Property, Inc. Restrictive Stock Agreements or 1998
EPP Award
Agreements, as the case may be (together the "Award Agreements").
The Award
Agreements are hereby modified and amended to provide that (A) no
prior existing
schedule for the lapsing of restriction on the shares awarded
thereunder shall
have any further force and effect, and (B) all restrictions imposed
by the
Company with respect to the Prior RSA's shall lapse only and
immediately upon
the termination of Executive's employment by any party, for any
reason,
regardless of whether such termination of employment is with or
without Cause,
and regardless of whether such termination of employment is with or
without Good
Reason; provided, however, that in the event Executive terminates
her employment
voluntarily or without Good Reason at any time during the period
from the
Effective Date until February 28, 2009, then the restrictions
imposed by the
Company on the Prior RSA's shall not lapse and the Executive's
rights in the
unvested Prior RSA's shall expire and such shares shall be deemed
to be property
of the Company.
(ii) Simultaneously with the execution of this Agreement, the
Company and Executive shall execute a 2007 Restricted Stock
Agreement in the
form of Exhibit A hereto pursuant to which the Company shall grant
Executive a
Restricted Stock Award of forty thousand (40,000) shares of
restricted common
stock of the Company under the 1998 EPP (the "2007 RSA").
Restrictions imposed
by the Company on the 2007 RSA shares shall lapse only and
immediately upon the
termination of Executive's employment by any party, for any reason,
regardless
of whether such termination of employment is with or without Cause,
and
regardless of whether such termination of employment is with or
without Good
Reason; provided, however, that in the event Executive terminates
her employment
voluntarily or without Good Reason at any time during the period
from the
Effective Date until February 28, 2009, the restrictions imposed by
the Company
on the 2007 RSA's shall not lapse and the Executive's rights in the
unvested
2007 RSA's shall expire and such shares shall be deemed to be
property of the
Company.
(f) Executive shall be entitled to reasonable vacation time, not
less
than four (4) weeks per year, provided that not more than two (2)
weeks of such
vacation time may be taken consecutively without prior notice to
and
non-objection by the Compensation Committee of the Board of
Directors or, if
there is no Compensation Committee, the Board of Directors.
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5.
Certain Terms
Defined. For purposes of this Agreement:
(a) Executive shall be deemed to be "disabled" if a physical or
mental
condition shall occur and persist which, in the written opinion of
a licensed
physician selected by the Board of Directors in good faith, has
rendered
Executive unable to perform the duties set forth in Section 1
hereof for a
period of sixty (60) days or more and, in the written opinion of
such physician,
the condition will continue for an indefinite period of time,
rendering
Executive unable to return to her duties.
(b) A termination of Executive's employment by LTC shall be deemed
for
"Cause" if, and only if, it is based upon (i) conviction of a
felony; (ii)
material disloyalty to the Company such as embezzlement,
misappropriation of
corporate assets or, except as permitted pursuant to Section 3 of
this
Agreement, breach of Executive's agreement not to engage in
business for another
enterprise of the type engaged in by the Company; or (iii) the
engaging in
unethical or illegal behavior which is of a public nature, brings
LTC into
disrepute, and result in material damage to the Company. The
Company shall have
the right to suspend Executive with pay, for a reasonable period to
investigate
allegations of conduct which, if proven, would establish a right to
terminate
this Agreement for Cause, or to permit a felony charge to be tried.
Immediately
upon the conclusion of such temporary period, unless Cause to
terminate this
Agreement has been established, Executive shall be restored to all
duties and
responsibilities as if such suspension had never occurred.
(c) A resignation by Executive shall not be deemed to be voluntary
and
shall be deemed to be a resignation with "Good Reason" if it is
based upon (i) a
diminution in Executive's title, duties, or salary; (ii) a material
reduction in
benefits; (iii) a direction by the Board of Directors that
Executive report to
any person or group other than the Board of Directors, or (iv) a
geographic
relocation of Executive's place of work a distance for more than
seventy-five
(75) miles from LTC's offices located at 31365 Oak Crest Drive,
Suite 200,
Westlake Village, California 91361.
(d) "Affiliate" means with respect to any Person, a Person who,
directly
or indirectly, through one or more intermediaries, controls, is
controlled by or
is under common control, with the Person specified.
(e) "Base Salary" means, as of any date of termination of
employment,
the highest base salary of Executive in the then current fiscal
year or in any
of the last four fiscal years immediately preceding such date of
termination of
employment.
(f) "Beneficial Owner" shall have the meaning given to such term in
Rule
13d-3 under the Exchange Act.
(g) A "Change in Control" occurs if:
(i) Any Person or related group of Persons (other than Executive
and
her Related Persons, the Company or a Person that directly or
indirectly
controls, is controlled by, or is under common control with, the
Company) is or
becomes the Beneficial Owner, directly or indirectly, of securities
of the
Company representing 30% or more of the combined voting power of
the Company's
then outstanding securities;
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(ii) The stockholders of the Company approve a merger or
consolidation of the Company with any other corporation (or other
entity), other
than a merger or consolidation which would result in the voting
securities of
the Company outstanding immediately prior thereto continuing to
represent
(either by remaining outstanding or by being converted into voting
securities of
the surviving entity) more than 66-2/3% of the combined voting
power of the
voting securities of the Company or such surviving entity
outstanding
immediately after such merger or consolidation; provided, however,
that a merger
or consolidation effected to implement a recapitalization of the
Company (or
similar transaction) in which no Person acquires 30% or more of the
combined
voting power of the Company's then outstanding securities shall not
constitute a
Change in Control;
(iii) The Stockholders 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; or
(iv) A
majority of the members of the Board of Directors of the
Company cease to be Continuing Directors;
(h) "Code" means the Internal Revenue Code of 1986, as amended.
(i) "Continuing Directors" means, as of any date of determination,
any
member of the Board of Directors who (i) was a member of such Board
of Directors
on the date of the Agreement or (ii) was nominated for election or
elected to
such Board of Directors with the approval of a majority of the
Continuing
Directors who were members of such Board of Directors at the time
of such
nomin
