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SEVERANCE AGREEMENT
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THIS SEVERANCE AGREEMENT (the "Agreement") is entered into as of
April
6, 2001, by and between Joseph M.
Napolitano, an individual residing in the
State of New York ("Senior Officer") and
Acadia Realty Trust, a Maryland real
estate investment trust with offices at 20
Soundview Marketplace, Port
Washington, New York 11050 (the
"Trust").
RECITALS
WHEREAS,
The Trust desires to continue the employment of Senior Officer
as Senior Vice President, Director of
Retail Property Management, and Senior
Officer desires to be employed by the Trust
as Senior Vice President, Director
of Retail Property Management; and
WHEREAS, Senior Officer has requested the Trust to enter into a
severance agreement and the Trust is
willing to do so.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreement set forth herein,
the parties hereby agree as follows:
1.
Termination of Employment and Change in Control.
(a) Senior Officer's employment hereunder may be terminated at
any time under the following
circumstances:
(i) Cause.
The Trust shall have the right to terminate
Senior Officer's employment for Cause upon Senior
Officer's: (A) willful and continued failure
substantially to perform his duties hereunder (other
than any such failure resulting from Senior Officer's
incapacity due to physical or mental illness) which
failure continues for a period of ten (10) days after
written demand for substantial performance is
delivered by the Trust specifically identifying the
manner in which the Trust believes the Senior Officer
has not substantially performed his duties; (B)
willful misconduct or (C) conviction of, or plea of
guilty to a felony. For purposes of this
subparagraph, no act, or failure to act, on Senior
Officer's part shall be considered "willful" unless
done, or omitted to be done, by him (i) not in good
faith and (ii) without reasonable belief that his
action or omission was in furtherance of the
interests of the Trust.
(ii) Death.
Senior Officer's employment hereunder shall
terminate upon his death.
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(iii) Disability. The
Trust shall have the right to
terminate Senior Officer's employment due to
"Disability" in the event that there is a
determination by the
Trust that the Senior Officer
has become physically or mentally incapable of
performing his duties under this Agreement and such
disability has disabled the Senior Officer for a
cumulative period of one hundred eighty (180) days
within a twelve (12) month period.
(iv) Good
Reason. The Senior Officer shall have the right
to terminate his employment for "Good Reason": (A)
upon the occurrence of any material breach of this
Agreement by the Trust which shall include but not be
limited to: a material, adverse alteration in the
nature of Senior Officer's duties, responsibilities,
or authority; (B) upon a reduction in Senior
Officer's Annual Base Salary or a material reduction
in other benefits (except for bonuses or similar
discretionary payments) as in effect at the time in
question, or a failure to pay such amounts when due
which is not cured by the Trust within ten (10) days
after written notice of such default by the Senior
Officer, (C) if the Trust relocates Senior Officer's
office requiring the Senior Officer to increase his
commuting time by more than one hour, then the Senior
Officer shall have the right to terminate his
employment, which termination shall be deemed for
Good Reason.
(v)
Without Cause. The Trust shall have the right to
terminate the Senior Officer's employment hereunder
Without
Cause subject to the terms and conditions of
this Agreement.
(vi) Change in
Control. The Senior Officer shall have the
right to terminate his employment hereunder on or
within three (3) months following a Change in
Control. Such termination shall be deemed a
termination for Good Reason hereunder. For purposes
of this Agreement "Change in Control" shall mean that
any of the following events has occurred: (A) any
"person" or "group" of persons, as such terms are
used in Sections 13 and 14 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), other
than any employee benefit plan sponsored by the
Trust, becomes the "beneficial owner", as such term
is used in Section 13 of the Exchange Act
(irrespective of any vesting or waiting periods) of
(i) Common Shares or any class of stock convertible
into
Common Shares and/or (ii) Common OP Units or
preferred units or any other class of units
convertible into Common OP Units, in an amount equal
to thirty (30%) percent or more of the sum total of
the Common Shares and the Common OP Units (treating
all classes of outstanding Common Shares, units or
other securities convertible into Common Shares as if
they were converted into Common Shares or Common OP
Units, as the case may be, and then treating Common
Shares and Common OP Units as if they were a single
class) issued and outstanding immediately prior to
such acquisition as if they were a single class and
disregarding any equity raise in connection with the
financing of such transaction; or (B) the dissolution
or liquidation of the Trust or the consummation of
any merger or consolidation of the Trust if the
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shareholders of the Trust and unit holders of the
Partnership taken as a whole and considered as one
class immediately before such transaction own,
immediately after
consummation of such transaction,
equity securities and partnership units possessing
less than fifty (50%) percent of the surviving or
acquiring Trust and partnership taken as a whole; or
(C) or any sale or other disposition of all or
substantially all of its assets, or a sale or other
disposition of at least 51% (based upon gross asset
value) of the core assets (defined as those
properties formerly marketed by Credit Suisse First
Boston as the core portfolio of the Company) or
(D)
a turnover, during any two (2) year period, of
the majority of the members of the Board, without the
consent of the remaining members of the Board as to
the appointment of the new Board members.
(b) Notice of Termination Any termination of Senior Officer's
employment by the Trust or any such
termination by the Senior Officer (other
than on account of death) shall be
communicated by written Notice of Termination
to the other party hereto. For purposes of
this Agreement, a "Notice of
Termination" shall mean a notice which
shall indicate the specific termination
provision in this Agreement relied upon and
shall set forth in reasonable detail
the facts and circumstances claimed to
provide a basis for termination of Senior
Officer's employment under the provision so
indicated. In the event of the
termination of Senior Officer's employment
on account of death, written Notice
of Termination shall be deemed to have been
provided on the date of death.
2.
Compensation Upon Termination of Employment By the Trust for
Cause or Voluntarily By The Senior Officer.
In the event the Trust terminates Senior Officer's employment
for
Cause, or the Senior Officer voluntarily
terminates his employment, the Trust
shall pay the Senior Officer any unpaid
Annual Base Salary at the rate then in
effect accrued through and including the
date of termination and any accrued
vacation pay ("Unpaid Accrued Salary"). In
addition, in such event, the Senior
Officer shall be entitled to exercise any
options which, as of the date of
termination, have vested and are
exercisable in accordance with the terms of the
applicable option grant agreement or plan.
All options and all restricted stock
granted to the Senior Officer which have
not vested on the date of termination
shall automatically terminate.
Except for any rights which the Senior Officer may have to
Unpaid
Accrued Salary through and including the
date of termination, and vested options
and stock, the Trust shall have no further
obligations hereunder following such
termination. The aforesaid amounts shall be
payable in full immediately upon
such termination.
3.
Compensation Upon
Termination of Employment Upon Disability,
Without Cause or By Senior Officer for Good Reason.
In the event of termination of Senior Officer's employment as a
result
of Senior Officer's Disability, Without
Cause or by Senior Officer for Good
Reason, the Trust shall pay to the Senior
Officer, the following:
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(i) any
Unpaid Accrued Salary through and including the
date of termination; plus
(ii) an amount
equal to one year's salary at the then
current annual base salary (before any reductions)
(the "Severance Salary"); plus
(iii) reimbursement of
expenses incurred prior to date of
termination ("Expense Reimbursement"); plus
(iv) the Senior
Officer's car allowance, if any, for one
year (the "Car Allowance"); plus
(v) a pro
rata portion of Senior Officer's bonus (based
upon the average of the last two years' bonuses);
plus
In the event of termination of or resignation by Senior Officer
because
of a Change in Control, in addition to the
above amounts,
(vi) the Trust
shall pay to the Senior Officer an amount
equal to six months' base salary (the "Change of
Control Retention Payment"); and
(vii) the Trust shall
continue Senior Officer's base salary
and medical benefits for a period not to exceed the
earlier of (a) six months from the date of such
termination or (b) the date when Senior Officer
becomes reemployed.
Notwithstanding anything to the contrary
