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Exhibit 10.9
W.P. CAREY & CO., INC.
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made the 7th day of April, 1997 between W.P. Carey
&
Co., Inc. (the "Company"), a New York corporation at 50 Rockefeller
Plaza, New
York, NY 10020, and Claude Fernandez ("Executive")
WITNESSETH:
WHEREAS, Executive has been an officer of the Company in which
capacity his services have contributed materially to the successful
operation of
the Company's business;
WHEREAS, the Company wishes to assure itself of the continued
availability of Executive's services, and Executive is willing to
give such
assurance in return for the benefits described herein;
NOW, THEREFORE, intending to be legally bound hereby, the
Company
hereby agrees to employ Executive, and Executive hereby agrees to
be employed by
the Company upon the following terms and conditions:
1. Office and Duties. Executive shall service the Company full time
in
such positions and have such titles, duties and power with the
Company and its
subsidiaries consistent with Executive's experience and abilities
as may from
time to time be determined by the board of directors of the Company
(the
"Board"), the Chairman of the Board or the Chief Executive Officer
of the
Company. Executive will use his reasonable best energies and
abilities and will
devote his full business time, except for vacation time and
reasonable periods
of absence due to sickness, personal injury or other disability, to
the duties
assigned to him and shall use his best efforts, judgment, skill and
energy to
perform such services faithfully and diligently to further the
business
interests of the Company, to improve and advance the business and
interests of
the Company, to increase shareholder value and otherwise promote
the best
interests of the Company's shareholders; provided that nothing
contained herein
shall preclude Executive from (i) serving on the board of directors
of any
business corporation with the consent of the Board, (ii) serving on
the board
of, or working for, any charitable or community organization or
(iii) pursuing
his personal financial and legal affairs, so long as such
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activities, individually or collectively, do not interfere with the
performance
of Executive's duties hereunder.
2. Term. This Agreement shall be for a term commencing as of the
date
hereof (the "Commencement Date") and ending on December 31, 2000
unless sooner
terminated as hereinafter provided. Unless either party elects to
terminate this
Agreement at the end of the original or any renewal term by giving
the other
party notice of such election at least 90 days before the
expiration of the then
current term, this Agreement shall be deemed to have been renewed
for an
additional one year period commencing on the day after the
expiration of the
then current term. The period during which Executive is employed
pursuant to
this Agreement, including any extension thereof in accordance with
the preceding
sentence, shall be referred to as the "Employment Period."
3. Compensation
(a) Base Salary. During the Employment Period, Executive shall
receive
an annual base salary ("Base Salary") at the same rate as in effect
on the date
hereof, which shall be payable in accordance with the Company's
generally
applicable payroll practices and policies. The Executive Committee
shall
periodically review Executive's Base Salary in light of the
salaries paid to
other officers of the Company, the performance of Executive, and
Executive's
total compensation from the Company and the Company may, in its
discretion,
increase such Base Salary by an amount it determines to be
appropriate. Any such
increase shall not reduce or limit any other obligation of the
Company
hereunder.
(b) Incentive Compensation. During the term of the Employment
Period,
Executive shall be eligible to participate in the Company's
incentive
compensation programs (including, without limitation, any program
for the
payment of commission income, disposition fees, and bonuses), as
the same may be
amended by the Company from time to time, at a level determined by
the Company's
Executive Committee. Without limiting the generality of the
foregoing, Executive
shall be entitled to draw, in approximately equal monthly
installments, against
such incentive compensation in an annual amount determined in
accordance with
the practices and policies of the Company.
4. Stock Option Grant. Effective as of January 1, 1997, Executive
will
receive the grant of an option pursuant to the Company's Stock
Appreciation
Rights Plan in respect of 2,000 shares of the Common Stock of the
notional
corporation described in such Stock Appreciation Rights Plan,
subject to the
terms and conditions of such grant. Executive agrees and
acknowledges that his
rights and obligations in respect of such option shall be governed
by the terms
and conditions of the Stock Appreciation
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Rights Plan, including, without limitation, the provisions thereof
relating to
the proportionate dilution of his interest by the grant, after the
effective
date of his award, of awards to other employees under the Stock
Appreciation
Rights Plan or the Company's Partnership Equity Plan.
5. Partnership Equity Plan. Effective as of January 1, 1989,
Executive
has received an award pursuant to the Company's Partnership Equity
Plan of 1,000
shares of the Common Stock of the notional corporation described
therein.
Effective as of January 1, 1996, Executive has received an
additional award
pursuant to the Partnership Equity Plan of 500 shares of the Common
Stock of the
notional corporation described therein. Executive agrees and
acknowledges that
his rights and obligations in respect of the Equivalent Shares, as
defined in
the Partnership Equity Plan, shall be governed by the terms and
conditions of
the Partnership Equity Plan, including, without limitation, the
provisions
thereof relating to the proportionate dilution of his interest by
the grant,
after the effective date of his award, of awards to other employees
under the
Stock Appreciation Rights Plan or the Partnership Equity Plan.
6. Benefits, Perquisites and Expenses.
(a) Benefits. During the Employment Period, Executive shall be
eligible to participate in each employee benefit plan sponsored or
maintained by
the Company, subject to the generally applicable provisions
thereof. Nothing in
this Agreement shall in any way limit the Company's right to amend
or terminate
any such plan in its discretion, so long as any such amendment does
not impair
the rights of Executive without treating similarly situated
executives in a
similar fashion.
(b) Business Expenses. During the Employment Period, the Company
shall
pay or reimburse Executive for all reasonable expenses incurred or
paid by
Executive in the performance of Executive's duties hereunder, upon
presentation
of expense statements or vouchers and such other information as the
Company may
require and in accordance with the generally applicable policies
and procedures
of the Company.
(c) Indemnification. The Company shall indemnify Executive and
hold
Executive harmless from and against any claim, loss or cause of
action arising
from or out of Executive's performance of services as an officer,
director or
Executive of the Company or any of its subsidiaries or in any other
capacity in
which Executive serves at the request of the Company on the same
basis as it
indemnifies its other officers. If, at any time, the Company has in
effect any
policy providing any indemnity to the Company or third parties with
respect to
the errors and omissions or other actions of officers or directors,
the Company
shall cause Executive's errors, omissions or other actions to
be
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covered under such policy on the same terms and conditions as apply
generally to
all other officers of the Company.
7. Termination of Employment.
(a) Early Termination of the Employment Period. Notwithstanding
Paragraph 2, the Employment Period shall end upon the earliest to
occur of (i) a
termination of Executive's employment on account of Executive's
death, (ii) a
Termination due to Disability, (iii) a Termination for Cause (iv) a
Termination
Without Cause, (v) a Termination for Good Reason or (vi) a
Termination due to a
Change of Control.
(b) Benefits Payable Upon Termination. Following the end of the
Employment Period pursuant to Paragraph 7(a), Executive (or, in the
event of his
death, his surviving spouse, if any, or his estate) shall be paid
the type or
types of compensation determined to be payable in accordance with
the following
table at the times established pursuant to Paragraph 7(c):
<TABLE>
<CAPTION>
Accrued
Earned Basic
Employee
Severance
Compensation
Benefits
Benefit
------------
--------
---------
<S>
<C>
<C>
<C>
Termination due to
Payable Payable
Not
Death
Payable
Termination due to Payable
Payable
Not
Disability
Payable
Termination for
Payable Payable
Not
Cause
Payable
Termination Without
Payable Payable
Payable
Cause
Termination with
Payable Payable
Payable
Good Reason
Termination due to a Payable
Payable
Payable
Change of Control
</TABLE>
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(c) Timing of Payments. Earned Basic Compensation shall be paid in
a
single lump sum as soon as practicable, but in no event more than
30 days
following the end of the Employment Period. Accrued Employee
Benefits shall be
payable in accordance with the terms of the plan, policy, practice,
program,
contract or agreement under which such benefits have accrued.
Severance Benefits
shall be paid at the same time as Executive would have received his
base salary
had he continued to be employed and for the period ending on the
first to occur
of (i) the first anniversary of Executive's termination of
employment and (ii)
the date on which Executive breaches any of the provisions of
Paragraph 8.
Notwithstanding the foregoing, the Company may elect, at any time
and in its
discretion, to pay Executive the present value of the remaining
Severance
Benefits payable hereunder in a single lump sum amount with such
present value
to be calculated using a discount rate equal to the one year
Treasury bill rate
as quoted in The Wall Street Journal (or in such other reliable
publication as
the Independent Committee, in its reasonable discretion, may
determine to rely
upon) on the first business day of such year on which such
publication is
published.
(d) Definitions. For purposes of Paragraphs 7 and 8, capitalized
terms
have the following meanings:
"Accrued Employee Benefits" means amounts which are vested or
which
Executive is otherwise entitled to receive under the terms of or in
accordance
with any plan, policy, practice or program of, or any contract or
agreement
with, the Company or any of its subsidiaries, at or subsequent to
the date of
his termination without regard to the performance by Executive of
further
services or the resolution of a contingency.
"Carey Affliated Entities" means (i) the Carey Family, (ii) the
employees of the Company and its affiliates, (iii) any Controlled
Entity and
(iv) the Carey Foundation.
"Carey Family" means William P. Carey, his spouse and lineal
descendants and his brothers and brothers-in-law, sisters and
sisters-in-law and
each of their lineal descendants.
"Change of Control" shall mean a transaction as a result of which
the
Carey Affiliated Entities (i) cease to be the beneficial owners of
at least 50
percent of the combined voting power of all the outstanding voting
securities of
the Company and (ii) are not otherwise in Effective Control of the
Company.
"Controlled Entity" means an entity (other than the Company) in
which
William P. Carey, the Company or any other Controlled Entity,
directly of
indirectly, owns a substantial equity interest and that is
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(i)
a corporation more
than 50 percent of the value of the outstanding
stock of which is owned directly or indirectly by the Carey
Family
and/or employees of the Company;
(ii)
a partnership more than 50 percent of the capital interest or
profits
interest in which is owned directly or indirectly by the Carey
Family
and/or employees of the Company;
(iii) a limited liability company more than 50 percent of the
ownership
interests in which are owned directly or indirectly by the
Carey
Family and/or employees of the Company; or
(iv) a trust in which
the Carey Family and/or employees of the Company
together have 50 percent or more of the voting power or
beneficial
ownership interest.
The Controlled Entities as of September 30, 1996 are listed on
Exhibit A
attached hereto. Notwithstanding the foregoing, in no event shall
the Carey
Foundation be considered a Controlled Entity.
"Controlling Shareho1der(s)" means the person(s) who, at the
relevant
time, hold of record a majority of the shares of the common stock
of the
Company.
"Earned Basic Compensation" means any salary or other
compensation
(including without limitation disposition fees) due and payable,
but unpaid, for
services rendered to the Company on or prior to the date on which
the Employment
Period ends.
"Effective Control" means the power to elect a majority of the
members
of the Board, whether (i) by reason of the ownership of securties
representing
more than 50% of the securities entitled to vote for the election
of directors
(the "Voting Shares" or (ii) pursuant to a shareholders agreement,
irrevocable
proxy or otherwise controlling the right to vote a majority of the
Voting
Shares. Notwithstanding the foregoing, if the Company is merged
with, into or
otherwise combined with a Public Corporation or more than 50% of
the assets of
the Company are transferred to a Public Corporation, the Carey
Affiliated
Entities shall be deemed to be in Effective Control of such Public
Corporation
if a majority of the directors on the board of diectors of such
Public
Corporation:
(x)
at the time of the
merger, combination, sale or other transaction,
were either
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(1) officers of the
Company or members of the Board or the board of
directors of an affiliate of the Company immediately prior
thereto or
(2) nominated for
election to the board of the Public Corporation by
the members of the Board, the board of directors of a Carey
Affiliated Entity or the persons who were the Controlling
Shareho1der(s) immediately prior to such transaction with the
Public Corporation, or
(y)
at any time following
any such transaction, were nominated for
election or elected by any of the Board, the board of directors of
a
Carey Affiliated Entity or the persons who were the Controlling
Shareholder(s) immediately prior to such transaction with the
Public
Corporation.
"Independent Committee" shall mean the committee initially
comprised
of George Stoddard, Charles Townsend and Warren Winturb and as it
may thereafter
be constituted from time to time in accordance with this provision.
If any
member of the initial Independent Committee (or any successor
thereto appointed
in accordance with this provision) ceases to a member of the
Independent
Committee for whatever reason, the successor to such person on the
Independent
Committee shall be appointed by the Controlling Shareholders from
the members of
the Board or the boards of directors of the Company's affiliates,
subject to the
approval of such appointment by the then remaining members of the
Independent
Committee, provided, however, that no member of the Independent
Committee shall
be a member of the Carey Family. The Controlling Shareho
