EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS
EMPLOYMENT AGREEMENT is made as of the 1 st day of
November 2005 (the “Execution Date”) by and between
Brandywine Operating Partnership, L.P., a Delaware limited
partnership (the “Company”) and Dan Cushing (the
“Employee”).
WHEREAS,
the Company desires to employ the Employee, and the Employee
desires to be employed by the Company, upon the terms and
conditions hereinafter set forth.
NOW,
THEREFORE, in consideration of the mutual covenants and obligations
contained herein, and intending to be legally bound, the parties,
subject to the terms and conditions set forth herein, agree as
follows:
1.
Effectiveness of this Agreement . Notwithstanding
anything herein to the contrary, including, without limitation, the
execution and delivery of this Agreement as of the Execution Date,
this Agreement shall not become effective for any purpose unless
and until the REIT Merger has been consummated. Upon the
consummation of the REIT Merger, this Agreement shall become fully
effective as if executed and delivered on the date of such
consummation (the “Effective Date”). The term
“REIT Merger” has the meaning given to it in the
Agreement and Plan of Merger dated as of October 3, 2005 (the
“Merger Agreement”) by and among Brandywine Realty
Trust, a Maryland real estate investment trust, the Company,
Brandywine Cognac I LLC, a Maryland limited liability company,
Brandywine Cognac II LLC, a Delaware limited liability company,
Prentiss Properties Trust, a Maryland real estate investment trust
(“PPT”), and Prentiss Properties Acquisition Partners,
L.P., a Delaware limited partnership (together with PPT and their
respective direct and indirect subsidiaries,
“Prentiss”).
2.
Employment and Term . The Company hereby employs the
Employee and the Employee hereby accepts employment with the
Company for the period commencing on the Effective Date and, unless
such employment is sooner terminated as provided herein,
terminating at 5:00 p.m. on the second (2d) anniversary of the
Effective Date. Such two-year period of employment as the
same may be reduced as provided herein upon an earlier termination
of the Employee’s employment, is referred to herein as the
“Term.” At the end of the Term, the
Employee’s employment with the Company shall automatically
continue thereafter on an “at will” basis and,
accordingly, Sections 5.1-5.3 of this Agreement shall have no
further force or effect and the Company may terminate the
employment of Employee at any time and for any reason, or for no
reason.
3.
Duties . During the Term, the Employee shall serve the
Company as its Senior Vice President and Managing Director –
Western Region (the “Position”). Employee shall
report to Bob Wiberg, the Company’s Executive Vice President
and Managing Director of Operations. The Employee shall serve
the Company faithfully and to the best of his ability and shall
devote his full work time, attention, skill, and efforts to the
performance of the duties required by and appropriate for the
Position. The Employee shall perform such specific duties and
responsibilities within the scope of the Position as may be
reasonably assigned to him from time to time by the Company, with
the understanding that the Employee’s duties and
responsibilities shall remain substantially similar to the duties
and responsibilities in his current position at Prentiss. The
Employee agrees to comply with all Company policies in effect
from
time to time
and to comply with all laws, rules, and regulations, including,
without limitation, those applicable to the Company.
4.
Compensation . The Company shall pay the Employee, and
the Employee hereby agrees to accept, as compensation for all
services to be rendered to the Company the compensation set forth
in Section 4 of this Agreement.
4.1
Salary . The Company shall pay the Employee an annual
salary of Two Hundred Fifteen Thousand Dollars
($215,000.00).
4.2
2005 Bonus . For the 2005 calendar year, the Employee
will receive a bonus in the amount of Seventy-Five Thousand Dollars
($75,000.00), payable on the earlier of the Effective Date or
December 31, 2005. The Company notes that this bonus is
recognized for services performed while employed by
Prentiss.
4.3
2005 Restricted Shares . Upon the consummation of the
REIT Merger, the Employee will be issued Thirteen Thousand Eight
Hundred (13,800) 2005 Brandywine Stock Grants which shall vest
immediately. The Employee will also be issued an additional
Three Thousand Four Hundred Fifty (3,450) 2005 Brandywine Stock
Grants in accordance with “Exhibit A” which shall
vest on the third anniversary of the date of grant.
4.4
2006 and Future Years Incentive Compensation . The
Company is developing a new incentive compensation plan for 2006
and future years. This new plan will include a cash bonus
component and an equity stock component. This new plan will
provide the Employee with the opportunity to earn total
compensation not less than the amount the Employee currently has
the opportunity to earn at Prentiss. Exact levels of
compensation will be dependent upon Company, regional, and
individual performance in accordance with the terms of the
plan. However, the Employee acknowledges that he will not be
eligible for any payment made by the Company to other Company
employees under the Company’s 2005 incentive compensation
plan, which will be payable in 2006.
4.5
Benefits . During the Term, the Employee shall be
eligible for medical and dental benefits, short and long term
disability coverage and life insurance benefits that the Company
provides generally for its executive officers in accordance with
the terms of the respective plans; provided, however, that nothing
herein shall be deemed to require the Company to adopt or maintain
any particular plan or policy. If the Company terminates the
Employee’s employment without Cause (as defined in Section
5.3 of this Agreement) or the Employee terminates the
Employee’s employment for Good Reason (as defined in Section
5.3 of this Agreement), the Employee shall receive the benefits
defined in the Prentiss Properties Trust Change in Control
Severance Protection Plan for Key Employees dated as of October 3,
2005.
4.6
Vacation. During the Term, the Employee shall receive
four weeks paid vacation during each calendar year.
4.7
Reimbursement of Expenses . The Company shall
reimburse Employee for all reasonable, ordinary and necessary
business expenses incurred by the Employee during the term in
connection with the performance of the Employee’s duties
hereunder in accordance with the Company’s regular
reimbursement procedures and practices in
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effect from
time to time. The Company agrees that the types and amounts
of reimbursements will not be less than the types and amounts of
reimbursements permitted under current Prentiss reimbursement
practices.
4.8
Payment . Payment of all compensation to Employee
hereunder shall be made in accordance with the terms of this
Agreement and applicable Company policies in effect from time to
time, including normal payroll practices, and shall be subject to
all applicable withholdings and taxes (collectively,
“Taxes”).
4.9
Benefits Based On Tenure of Employment . The Company
agrees that to the extent that any benefit provided pursuant to
this Agreement is based in whole or in part on tenure of
employment, then the Employee will be credited with his prior years
of employment with Prentiss when calculating tenure of
employment.
5.1 During
the Term, if the Company terminates the Employee’s employment
for Cause (as defined in Section 5.3 of this Agreement) or the
Employee terminates the Employee’s employment for a reason
other than Good Reason (as defined in Section 5.3 of this
Agreement), the Employee shall be entitled to salary accrued but
unpaid as of the date of such termination, and the Employee shall
no longer be entitled to receive any other payments, rights or
benefits under this Agreement, and the Company shall not have any
further obligation to the Employee pursuant to this Agreement,
except (x) as provided to the contrary under the terms of any
benefit plan in which he participates and pursuant to any federal
or state law regarding the continuation of coverage under the
Company’s group health plan and (y) as provided in Section
5.2 of this Agreement.
5.2 During
the Term, if the Company terminates the Employee’s employment
for a reason other than Cause (as defined in Section 5.3 of this
Agreement), including death or disability, or the Employee
terminates the Employee’s employment for Good Reason (as
defined in Section 5.3 of this Agreement), then (x) the Company
shall pay to the Employee salary accrued but unpaid as of the date
of such termination, (y) the Company shall pay to the Employee the
payments and benefits defined under the Prentiss Properties Trust
Change in Control Severance Protection Plan for Key Employees dated
as of October 3, 2005.
5.3 The
term “Cause” shall mean: (i) any material breach by the
Employee of any of the terms or provisions of this Agreement which
the Employee fails to cure within fifteen (15) days after written
notice thereof has been provided to the Employee by the Company; or
(ii) the Employee’s conviction on a felony or a crime
involving moral turpitude or substance abuse; or (iii) the
Employee’s misappropriation of funds. The term
“Good Reason” shall mean: (i) the Company requiring the
Employee’s relocation more than fifty (50) miles from the
Employee’s primary office subsequent to the Effective Date,
without such Employee’s consent; or (ii) a material adverse
alteration in the nature of the Employee’s position, provided
that (x) a change of title, or (y) a change of reporting and, in
either case, a concomitant change of duties, shall not be
considered a material adverse alteration unless the duties are
materially inconsistent with the Employee’s duties at the
time of the Effective Date; or (iii) the Employee is excluded from
the Company’s (or upon a Change in Control, its
successor’s) long term incentive
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plan or
reduction by the Company of the Employee’s annual base salary
or target bonus; or (iv) an assignment of duties to the Employee
that is materially inconsistent with the Employee’s job
description at the time of the Effective Date; or (v) a
“Change in Control” of the Company after the Effective
Date (provided the Employee elects to resign within thirty (30)
days of the Change in Control). The term “Change in
Control” has the meaning provided to it in the
Company’s Amended and Restated 1997 Long-Term Incentive
Plan.
5.4 The
Company and the Employee agree that the REIT Merger constitutes a
“Change in Control” for purposes of and as defined in
Section 2.7 of the Prentiss Properties Trust Change in Control
Severance Protection Plan for Key Employees dated as of October 3,
2005, that this Agreement is not meant to any way reduce or
eliminate any right or benefit to which the Employee is entitled
under that Plan, and that any ambiguity or conflict between that
Plan and this Agreement shall be resolved in favor of the
Employee.
5.5 If
the Company terminates the Employee’s employment after the
Term, then the Employee will be entitled to severance payments
consistent with the Company’s past practices for comparable
employees. To the extent that any severance benefit is based
in whole or in part on tenure of employment, then the Employee will
be credited with his prior years of employment with Prentiss when
calculating tenure of employment.
6.
Confidential Information . The Company shall provide
the Employee with the confidential and proprietary information
concerning the Company. Both during the Term and at all times
thereafter, the Employee shall not disclose such information to any
other person or entity.
7.
Restrictive Covenants .
7.1 The
Employee agrees that, during the two-year period immediately
following the Effective Date of th