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Great Lakes Reit - Form of Limited Purpose Employee Loan Program
EXHIBIT 10.14
FORM OF
GREAT LAKES REIT
LIMITED PURPOSE EMPLOYEE LOAN PROGRAM
LOAN SECURITY AGREEMENT
This Agreement is made as of ________________, 2000 between EMPLOYEE NAME, residing at __________________ ___________ ("Employee"), and Great Lakes REIT, a Maryland real estate investment trust, having its principal office at 823 Commerce Drive, Oak Brook, Illinois 60523 ("GLR").
WHEREAS, Employee has executed a notice of option exercise for the purchase of _____________ shares of GLR Common Shares of Beneficial Interest (the "Shares") pursuant to stock options that GLR has previously granted Employee (the "Options"). The purchase price is $_______, [and income taxes related to the exercise of $___________] together totaling $___________ which Employee desires to finance by a loan from GLR,
AND WHEREAS, Employee desires to borrow from GLR, and GLR is willing to lend the sum of $____________ to Employee as permitted under the Great Lakes REIT Limited Purpose Employee Loan Program (the "Loan Program"), subject to the terms and conditions set forth in this Agreement.
NOW THEREFORE in consideration of their mutual promises, the parties agree as follows:
1. AGREEMENT TO BORROW AND LEND. Employee agrees to borrow from GLR, and GLR agrees to lend to Employee, the sum of $__________ under the general terms specified in the promissory note (the "Note") in the form attached hereto as EXHIBIT A. The sum borrowed by Employee will be paid to GLR on behalf of and for the account of Employee.
2. DOCUMENTS TO BE DELIVERED TO GLR. Concurrently with the execution and delivery of this Agreement, Employee shall execute and deliver to GLR:
(a) the Note; and
(b) stock powers for collateral assignment only (the "Stock
Power"), substantially in the form attached hereto as
EXHIBIT B, executed in blank by Employee.
Employee covenants to GLR that, when GLR's share transfer agent issues any certificate or certificates evidencing any Collateral (as defined herein), Employee will promptly deliver, or cause to be promptly delivered, such certificate(s) to the then-serving Secretary of GLR. Employee covenants that Employee will cause GLR's share transfer agent to deliver such certificate(s) directly to the then-serving Secretary of GLR upon GLR's written notice to Employee that GLR requires such delivery of the certificate(s).
3. SECURITY INTEREST. Employee grants GLR, as collateral security for Employee's Obligations (as defined herein), a continuing security interest in Employee's right, title, and interest in the Collateral and any proceeds thereof. On Employee's performance in full of the Obligations secured in this Agreement, the Collateral and the other documents referred to in Paragraph 2 of this Agreement will be returned to Employee and the security interest created by this Agreement, as well as this Agreement, will terminate, without further liability on the part of either party.
(a) For purposes of this Agreement, the term "Collateral"
means all of the Shares, together with all stock and
other non-cash dividends paid and non-cash
distributions made upon the Shares, all securities
and other property received in addition to or in
exchange for the Shares, all rights to subscribe for
securities incident to the Shares, all other proceeds
of any of the foregoing, and any certificate(s)
evidencing any of the foregoing.
(b) For purposes of this Agreement, the term
"Obligations" means all of Employee's indebtedness,
obligations and/or liabilities (i) under the Note and
(ii) under this Agreement.
4. EVENTS OF DEFAULT. If any one or more of the events set forth below occurs (each an "Event of Default"), then, GLR shall, subject to Paragraph 5 of this Agreement, have such rights and remedies with respect to the Collateral or any part thereof and the proceeds thereof as are provided by the Uniform Commercial Code and such other rights and remedies with respect thereto which it may have at law or in equity or under this Agreement:
(a) NONPAYMENT OF THE NOTE. Employee is in default of any
payment of interest and/or principal due on the Note
if such default shall not be cured within 10 business
days following written notice of such default to
Employee;
(b) ASSIGNMENT OF THE COLLATERAL. Employee transfers,
sells or grants a security interest in the Collateral
during the term of this Agreement; or
(c) BREACH OF OBLIGATIONS. Employee breaches his material
obligations, covenants, or undertakings under this
Agreement if such breach shall not be cured within 10
business days following written notice of such breach
to Employee.
5. NOTICE OF DEFAULT AND POWER TO SELL. If an Event of Default occurs, GLR will give written notice of such Event of Default to Employee. Such notice will specify the amount of principal and accrued interest due under the Note. If Employee fails to pay such principal and accrued interest within ________ days of Employee's receipt of such notice, then GLR may (but is not obligated to) execute a market sale of the Shares and deliver the Collateral to settle any such sale.
In case of any sale, GLR may first deduct all expenses of the sale, and delivery of the Collateral, and any incidental expenses, including reasonable attorney's fees and brokerage commissions. GLR will then apply the residue to any amounts due and unpaid on the Obligations, and will return the surplus, if any, to Employee. Any sale conducted pursuant to this Paragraph 5 will be deemed commercially reasonable.
If GLR does not start to sell the Collateral within ninety (90) days after GLR's right to sell it accrues, as per this Paragraph 5, then Employee will have the right to request that GLR sell the Collateral or that Employee, at his own expense, be allowed to sell it. If Employee requests that GLR sell the Collateral, GLR will not be obligated to do so unless the net proceeds to be received from such disposition will be sufficient to fully satisfy the Obligations of Employee to GLR. If Employee requests that he be allowed to sell the Collateral, any disposition must be on terms and conditions approved by GLR, in its sole discretion; PROVIDED, HOWEVER, that GLR is obligated to give such approval if the disposition fully satisfies the Obligations of Employee to GLR. GLR will not be liable to Employee for any agents' or brokers' fees in the event Employee sells the Collateral. In connection with any sale or disposition of the Collateral, GLR will have the absolute right to present the Stock Power for the purpose of effecting the transfer of the Collateral.
6. EMPLOYEE'S REMEDIES AGAINST GLR. Employee agrees that he will not assert, against GLR or the Collateral, any claim or demand arising out of his option exercise.
7. TRANSFER AGENT'S RESPONSIBILITY TO EMPLOYEE. Employee agrees that GLR's transfer agent, its officers, agents, servants, employees, and/or attorneys, will have no responsibility to him under this Agreement other than to deliver the Collateral to GLR, or to return it to Employee, in accordance with this Agreement.
8. SUCCESSORS AND ASSIGNS. This Agreement shall be binding on the parties hereto, their respective legal representatives, heirs, administrators, executors, successors and permitted assigns, as the case may be.
9. JOINT AND SEVERAL LIABILITY. In the event any of the Collateral is titled in joint tenancy or tenancy in common, the term "Employee" encompasses all Collateral owners, and in such event, the Obligations of Employee and the other joint owners of such Collateral will be joint and several.
10. ASSIGNMENT OF RIGHTS. Employee may not assign his rights or obligations under this Agreement without GLR's prior written consent. Any assignment in contravention of this Agreement shall be null and void. GLR may assign this Agreement and all of its rights, title, and interest in the Collateral without Employee's consent.
11. WAIVER OF TRIAL BY JURY. Except as prohibited by statute, the parties to this Agreement waive trial by jury in any action brought by any of the parties against the other, on any matter whatsoever, arising out of this Agreement. With respect to any matter for which a jury trial cannot be waived, the parties agree not to assert any counterclaims nor move to consolidate any claim with any action in which a jury trial is waived.
12. RIGHTS OF EMPLOYEE AS TO COLLATERAL. Subject to any limitations under GLR's compensation or benefits plans pursuant to which the Options were granted and until GLR makes a demand for payment pursuant to Paragraph 5 following an Event of Default, Employee shall have the right to exercise all voting rights with respect to the Collateral and to receive and retain all cash dividends paid upon any of the Collateral.
13. MERGER AND MODIFICATIONS. This Agreement, the Note, and the Loan Program contain the entire agreement and understanding of the parties with respect to the subject matter hereof, and no representations, ...
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