Exhibit 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into by
and
between BNP Residential Properties, Inc. (the "Company"), and D.
Scott Wilkerson
(the "Executive"), effective as of August 1, 2005 (the "Effective
Date").
WHEREAS, the Company desires to insure the availability the
Executive's
services, and the Executive is willing to render his services, all
on the terms
and conditions of this Agreement;
NOW THEREFORE, in consideration of the mutual covenants contained
in
this Agreement, the Company and the Executive agree as follows:
1.
Employment. On the
terms and conditions
set forth in this
Agreement,
the Company hereby employs the Executive during the Employment Term
(as
defined in Section 2) as the President and Chief Executive Officer of
the Company, and the Executive hereby accepts such employment.
2.
Term. This Agreement shall be effective for a term which shall
commence
on the Effective Date
and shall continue
until terminated by either
party by providing at least three (3) years prior written notice (the
"Notice Period") of the effective date of such termination to the
other
party (the "Employment Term").
3.
Duties of Executive.
The Executive agrees
to undertake the duties and
responsibilities
inherent in the
position of President and Chief
Executive Officer,
which may encompass
different or additional duties
as may, from time to
time, be reasonably assigned by the Company's
Board of Directors
(the "Board of Directors"), and the duties and
responsibilities
undertaken by the Executive may be reasonably altered
or modified
from time to time by the Board of
Directors,
provided,
however, that the
Executive's duties and responsibilities shall be no
less than those
traditionally inherent
in the position of President &
Chief Executive
Officer. The Executive
agrees to abide by the
rules,
regulations,
instructions,
personnel practices
and policies of the
Company and any changes thereof that are applicable to the
employees of
the Company in general. During the Employment Term, except
as approved
by the Company's
Board of Directors
(including
any approval given
before the date of this Agreement), the Executive will devote his
full
business time and
efforts to the
business of the Company and will not
engage in consulting
work or any trade or business for his own account
or for or on behalf of
any other person, firm or corporation that
competes, conflicts or
materially interferes
with the performance
of
his duties
hereunder
in any way. The Executive may engage in
non-competitive
personal or
charitable
activities
for reasonable
periods of time each month so long as such activities do not interfere
with the Executive's responsibilities under this Agreement.
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4.
Compensation and Benefits.
4.1.
Base Salary.
During the
Executive's
employment
under this
Agreement, the
Executive shall receive a base salary at an
annual rate of $300,000, payable in cash in accordance with
the
Company's payroll
practices generally
applicable to the
Company's senior
executives
(the "Base
Salary"). The Base
Salary shall be subject to increases, in the sole discretion
of the Board of
Directors or a
committee appointed by the
Board of Directors,
at such times as salary reviews are
conducted generally for the Company's senior executives.
4.2.
Annual Bonus. During
the Executive's
employment
under this
Agreement, in the sole
discretion of the
Board of Directors,
the Company
may pay to the
Executive an annual bonus (an
"Annual Bonus"). The terms, conditions and amount of an Annual
Bonus, if any,
shall be determined by
the Board of Directors
or a committee appointed by the Board of Directors in its sole
and absolute discretion.
4.3.
Stock-Based
Compensation. During
the Executive's
employment
under this Agreement,
the Executive shall be eligible to
participate in such incentive stock plans as may be maintained
by the Company from
time to time for senior executives. The
Executive's
awards under
such plan, if any, shall be
determined by the
administrator
of the plan.
The Executive
shall be granted
70,000 restricted
shares of the
Company's
common stock,
par value $0.01 per share ("Common Stock"),
pursuant to the
Company's Amended and Restated 1994 Stock
Option and Incentive Plan, as amended May 19, 2005 (the "Stock
Incentive Plan"),
subject to the terms
and conditions of the
Restricted Stock
Agreement attached hereto as Exhibit A.
4.4.
Benefit Plans. During the Employment Term, the Executive shall
be entitled to (i)
participation in such employee retirement
and welfare benefit plans, programs, policies and arrangements
as maintained
by the Company from time to time, provided,
however, the
Company shall pay 100% of the cost of
coverage
under the Company's
health insurance
plan for the
Executive
and the eligible
family members of the
Executive under the
health insurance plan; (ii) reasonable vacation allowed on an
annual basis
consistent
with the Executive's duties and
responsibilities,
provided, however,
that any vacation
time
accrued but not used
during a calendar
year shall not
carry
forward from
year to year;
(iii) paid holidays, leave of
absence, leave
for illness, funeral leave and temporary
disability leave
in accordance with the policies of the
Company; and (iv) perquisites as from time to time provided by
the Company to its senior executives.
4.5.
Life Insurance. The Company will pay for an annually renewable
term life insurance policy, based on standard rates, on behalf
of the Executive in the amount of $1,500,000 and the Company
will pay any Federal,
state or local
income and
employment
taxes incurred by the Executive as a result of such payment by
the Company. In the event the Executive does not qualify for a
standard rate
life insurance policy, at the Executive's
election either (i) the
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Company shall reduce the amount of the benefit provided to the
Executive to the
extent necessary for the cost of the life
insurance policy
to the Company to equal the cost of a
standard rate
policy, or (ii) the Executive may pay the
difference between
the actual cost of the policy to the
Company and the cost of a standard rate policy. The Company,
in its sole discretion, may review and increase the amount
of
such insurance policy
upon each anniversary
of the Effective
Date.
4.6.
Expenses. During
the Executive's employment under this
Agreement, the Company
shall reimburse the Executive for
ordinary and reasonable out-of-pocket expenses incurred by the
Executive in the
performance of the
employment duties
under
this Agreement,
provided that the
Executive shall account to
the Company for such expenses in accordance with the employee
business expense policies and practices of the Company.
5.
Termination of Employment.
5.1.
Dismissal without
Cause and Resignation for Good Reason,
During the Employment Term.
5.1.1. Dismissal
without Cause. The Company may terminate
the Executive's
employment
under this Agreement
at
any time during the Employment Term without Cause (as
defined in Section
5.1.4) by giving
written notice
thereof to the
Executive at least 30 days before the
effective date
of such termination. Upon such
termination, the
Executive shall be
entitled to the
compensation as provided in Sections 5.1.3 and 5.3 of
this Agreement.
5.1.2.
Resignation for
Good Reason. The Executive may
terminate his employment under this Agreement at any
time during the
Employment Term for
Good Reason (as
defined in Section
5.1.5) by giving
written notice
thereof to the Company
at least 30 days
before the
effective date of such termination. Such notice shall
specify in reasonable
detail the Good Reason
based
upon which the
Executive intends to
terminate his
employment. Upon
such termination, the Executive
shall be entitled to such compensation as provided in
Sections 5.1.3 and 5.3 of this Agreement.
5.1.3. Payment
upon Termination
without Cause or for Good
Reason. If the
Executive's
employment
under this
Agreement is terminated during the Employment Term
either by the Company without Cause or by the
Executive for Good Reason, and such termination is
not in connection
with a Change in Control, the
Executive shall be entitled to the following:
A. As
consideration
for the Executive's
obligations under the restrictive covenants
set forth in Section 7, a cash lump sum
payment, paid
within 30 days after the
effective date of termination, equal to (1)
the "Severance Period," which shall be
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equal to the lesser
of (x) the
number of
whole and fractional
years remaining in the
Employment Term, and
(y) the Notice Period,
times (2) the
sum of (i)
the Executive's
Base Salary in effect immediately before the
date written
notice of termination was
given, and (ii) the
average annual bonus
(whether paid
under this Agreement or
otherwise)
determined and
paid to the
Executive for the
three years
immediately
preceding the
date written notice of
termination was
given, or, if as of such
date the Executive has
been employed by the
Company for less
than three years, such
shorter period as to which the Executive has
been
both employed
and eligible to
receive
an annual bonus.
B.
During the Severance Period, or, if earlier,
until the Executive becomes re-employed with
another employer, the Company shall continue
to provide
health,
dental,
life
and
disability
insurance
benefits to
the
Executive on terms and
conditions at
least
equal to those which would have been
provided to the Executive in accordance with
the plans and programs described in Sections
4.4(i) and
4.5 of this Agreement if the
Executive's employment
had not been
terminated. In the event that the
Executive's
participation in any
such plan
or program is barred by applicable law, or
in the Company's
discretion
such benefits
cannot be provided
without adverse
income
tax consequences
to the Company or the
Executive, the
Company shall arrange to
provide the
Executive
with
benefits
substantially similar
to those which the
Executive would otherwise have been entitled
to receive under
such plans and programs
from which
continued
participation
is
barred.
C.
Accelerated vesting of the outstanding but
unvested restricted shares evidenced by the
Restricted Stock Agreement attached hereto
as Exhibit A, as provided therein.
D.
Accelerated vesting of
any outstanding
but
unvested Company stock options and shares of
restricted stock of
the Company
issued to
the Executive
during the
Employment
Term
(other than
those
evidenced
by the
Restricted Stock
Agreement attached
hereto
as Exhibit
A), such that the number of
restricted shares
that would
have become
vested and the number of option shares that
would have become
vested and exercisable
during the Severance Period if the Executive
had been continuously
employed during
that
period shall become vested as of the
effective
date of
the Executive's
termination.
E. With
respect to each dividend record date
occurring during the Severance Period, a
cash payment equal to the ordinary dividend
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that would have been payable to Executive
with respect to any share of restricted
stock of the Company granted to the
Executive that is forfeited upon Executive's
termination of employment. Subject to
Section 8 hereof, such cash payment will be
made on the same day, or as soon as
practicable after, the corresponding
dividend is paid to shareholders.
5.1.4.
Definition of "Cause." "Cause" means:
A. a
deliberate
or intentional material
misrepresentation by
the Executive
in the
Executive's relations with the Company;
B. the
commission
of a crime by the
Executive
which constitutes a
felony or a misdemeanor
which involves moral
turpitude or which has
a material adverse
effect on the
Company,
its business, reputation or interests;
C. a
material breach of any contract or
agreement between
the Executive and the
Company (including
this Agreement) or a
material breach
by the Executive of a
fiduciary duty
or responsibility to the
Company, which has not been cured within the
time periods (if any) specified by the Board
of Directors;
D. the
Executive's
abuse of drugs or
alcohol
which affects
the Executive's ability to
perform the
Executive's duties
under this
Agreement or otherwise; or
E. the
willful, negligent or
wanton misconduct
of the Executive
which results in
material
damage to the Company, its business,
reputation or interests.
5.1.5.
Definition of "Good
Reason." "Good Reason" means any
of the following if implemented by the Company
without the Executive's written consent and not cured
or corrected
by the Company within 30 days after
notice thereof by the
Executive to the Company under
Section 5.1.2:
A. an
assignment
to the Executive of any
duties, responsibilities
or
status
materially and adversely inconsistent with,
or which constitute a material adverse
change in, the Executive's current position,
duties,
responsibilities or status with the
Company;
B. a
material adverse change in the Executive's
current reporting responsibilities, title or
office;
C. a
reduction
by the Company of the
Executive's Base Salary;
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D. a
material violation of
the provisions
of
Sections 4.3, 4.4 or 4.5 of this Agreement;
or
E. a
change in the
Executive's principal
work
location by more than 50 miles.
The determination of the amount of any compensation
and benefits or other payments to be paid or provided
to or in respect of the Executive under this
Agreement shall be made without regard to any
reduction therein constituting Good Reason.
5.2.
Death, Disability,
Termination
for Cause or without Good
Reason or Termination at the End of the Employment Term.
5.2.1. Dismissal
for Cause.
The Company may
terminate the
Executive's employment under this Agreement for Cause
at any time during the Employment Term by (i) giving
written notice thereof to the Executive specifying in
reasonable detail the
basis for the Cause upon which
the Company
intends to
terminate the Executive's
employment, and (ii)
effecting such termination by a
majority vote of the
non-management
members of the
Board of Directors. The effect of such termination is
provided in Section 5.2.4.
5.2.2.
Resignation
without Good Reason.
The Executive may
terminate the
Executive's
employment
under this
Agreement without Good
Reason at any time during the
Employment Term by
giving written notice
thereof to
the Company at least
30 days before
the effective
date of such termination, which notice may be waived
in whole or in part by the Company in its sole
discretion. The
effect of such termination is
provided in Section 5.2.4.
5.2.3.
Termination upon Death or Disability. This Agreement
shall terminate
automatically
upon the
Executive's
death. If the Company
determines in good
faith that
the Executive
has a Disability as defined in this
Section, the Company
may terminate
his employment
under this
Agreement by notifying the Executive
thereof at least 30 days before the effective date of
termination.
For purposes of this Agreement,
"Disability" shall
mean any medically
determinable
physical or mental
impairment which has lasted for a
continuous period of not less than 180 days and which
renders the
Executive
unable
to perform the
Executive's material duties under this Agreement. If
there is any dispute
between the parties as to the
Executive's
Disability, the
Company shall select or
approve a physician
whose determination as to the
Executive's Disability shall bind the parties hereto.
The effect of a
termination due to the
Executive's
death or Disability is provided in Section 5.2.4.
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5.2.4. Effect of
Dismissal for Cause,
Resignation
without
Good Reason,
Termination upon Death or Disability or
Termination at the End of the Employment Term. If the
Executive's
employment under
this Agreement is
terminated at any time during the Employment Term by
the Company for Cause, by the Executive without Good
Reason, or due to the Executive's death or Disability
as provided in this Agreement, or if the Executive's
employment terminates
at the end of the
Employment
Term, the Executive shall be entitled to receive
compensation only as
provided in Section 5.3 of this
Agreement.
5.3.
Payment of Base Salary upon Termination. Upon a termination of
the Executive's
employment
under this Agreement for any
reason, the
Company shall pay or cause to be paid to the
Executive his
Base Salary earned but unpaid as of the
effective date of
termination,
payable in cash on or
before
the day on which the
Executive would have been paid such
amount if his
employment hereunder
had not been
terminated,
but in no event later than the date as required by law.
5.4.
No Duty to Mitigate.
The Executive shall
not be obligated to
seek other
employment
or take any
other action by way of
mitigation of the amounts payable to the Executive
under any
of the provisions of this Agreement, and except as provided in
Section 5.1.3.B, such
amounts shall not be reduced whether or
not the Executive obtains other employment.
6.
Change in Control.
6.1.
Benefits upon
Change in Control or Termination of the
Executive's Employment
without Cause in
Contemplation
of a
Change in Control. In the event (i) a Change in Control occurs
while the
Executive is employed by the Company under this
Agreement, or (ii)
the Executive's employment during the
Employment Term is
terminated by the Company without Cause in
contemplation of a
Change in Control, the
Executive shall be
entitled to the following:
A. As
consideration
for the Executive's
obligations under the restrictive covenants
set forth in Section 7., a lump sum cash
payment, paid
immediately
before
the
effective date of the
Change in Control,
equal to the product
of (i) the
number of
whole and fractional
years remaining in the
Employment Term as of
either the
effective
date of the Change in Control or the
termination of
employment,
as applicable,
times (ii) the
Executive's Base
Salary at
the
rate in effect
immediately before
the
effective date of the
Change in Control
or
the
termination of
employment, as
applicable,
provided, however,
that the
Executive shall not be entitled to such lump
sum payment if, prior to the effective date
of the Change in Control, the Executive is
offered and
accepts employment by the
Company, the successor to the Company or the
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person or entity
effecting the Change in
Control, following the Change in Control;
B. A
lump sum cash payment, paid immediately
before the effective date of the Change in
Control, equal to the "Fair Market Value"
(as defined in the Stock Incentive Plan and
determined immediately before the Change in
Control) of 150,000 shares of Common Stock
(as adjusted in the manner provided in
Section 3(c) of the Stock Incentive Plan in
the event of any stock dividend, stock split
or similar change in capitalization
affecting the Common Stock which occurs
after the Effective Date and before a Change
in Control);
C. A
lump sum cash payment, paid immediately
before the effective date of the Change in
Control, equal to the sum of each "Special
Dividend Amount" (as defined below) with
respect to any Special Dividend (as defined
below) paid while the Executive is employed
under this Agreement and b
