Employment Agreement dated February 22, 2021, between Agree Realty Corporation and Simon Leopold
AGREE REALTY CORPORATION
70 East Long Lake Road
Bloomfield Hills, Michigan 48304
This EMPLOYMENT AGREEMENT (this “Agreement”) is made effective as of the 8th day of February 2021, by and between AGREE REALTY CORPORATION, a Maryland corporation (the “Company”), and SIMON LEOPOLD (the “Executive”).
WHEREAS, the Company and the Executive desire to enter into an Employment Agreement dated February __, 2021, pursuant to which the Executive agrees to serve as the Company’s Executive Vice President, Chief Financial Officer, and Secretary;
WHEREAS, this Agreement sets forth the terms and conditions of the Executive’s employment with the Company;
WHEREAS, the Executive is expected to make certain contributions to the financial strength of the Company; and
WHEREAS, Executive is not precluded from entering into this Agreement by any obligations to others;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, the parties hereto hereby agree as follows:
For purposes of this Agreement, “Disability” shall mean the inability of the Executive to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.
For purposes of this Agreement, “Cause” shall mean: (i) the Executive’s willful failure or refusal to perform specific reasonable directives of the Chief Executive Officer or Board, which directives are consistent with the scope and nature of the Executive’s duties and responsibilities under this Agreement, and which are not remedied by the Executive within sixty (60) days after written notice of his failure by the Board; (ii) a felony conviction of the Executive; or (iii) a material misconduct by the Executive, including breach of his obligations under Sections 8 and 9 hereof. No act or failure to act on the part of the Executive shall be deemed “willful” under (i) hereof if it was due primarily to an error in judgment or negligence, but shall be deemed “willful” only if done or omitted to be done by the Executive not in good faith and without reasonable belief that his action or omission was in the best interests of the Company. A material violation of Sections 8 or 9 hereof shall constitute “cause” and shall void any obligations of the Company otherwise existing hereunder for post-termination benefits, provided that Executive shall receive notice of, and opportunity to respond to a claim of such material violation of Sections 8 or 9.
For purposes of this Agreement, “Good Reason” shall mean: (i) a material breach of this Agreement by the Company; (ii) other than for Cause, a material reduction in the nature or scope of the Executive’s title, authority, powers, functions, duties, or responsibilities; (iii) a material reduction in the salary paid to Executive or benefits provided to Executive; or (iv) without Executive’s written consent, a transfer of the place of employment of more than thirty (30) miles from the Company’s principal executive headquarters. A termination by the Executive shall not be for Good Reason unless the Executive gives the Company written notice specifying the event or condition that the Executive asserts constitutes Good Reason, the notice is given no more than ninety (90) days after the occurrence of the event or initial existence of the condition that the Executive asserts constitutes Good Reason, during the thirty (30) days following such notice the Company either fails to remedy or cure the event or condition or notifies the Executive in writing that it will not remedy or cure the event or condition and the Executive resigns within thirty (30) days after the end of the cure period or, if earlier, the date the Company notifies the Executive in writing that the Company will not remedy or cure the event or condition that the Executive asserts constitutes Good Reason.
(i) The Company is merged, consolidated or reorganized into or with another corporation or other legal person and as a result of such merger, consolidation or reorganization less than a majority of the combined voting power of the then-outstanding securities of the entity resulting from such merger, consolidation or reorganization immediately after such transaction are held in the aggregate by holders of the combined voting power of the then-outstanding securities of the Company entitled to vote generally in the election of directors of the Company (“Voting Stock”) immediately prior to such transaction;
(ii) The Company sells all or substantially all of its assets to any other corporation or other legal person, and less than a majority of the combined voting power of the then-outstanding voting securities of the purchaser immediately after such transaction are held in the aggregate by the holders of Voting Stock of the Company immediately prior to such sale;
(iii) If a report is filed with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), disclosing that any person (as the term “person” is used in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act), other than Richard Agree or Joey Agree, and their immediate family and affiliates, in aggregate, is the beneficial owner (as the term “beneficial owner” is defined under Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of securities representing 25% or more of the Voting Stock;
Notwithstanding the foregoing provision of Section 7(c)(iii) hereof, a Change in Control shall not be deemed to have occurred for purposes of this Agreement solely because the Company, an entity in which the Company directly or indirectly beneficially owns 50% or more of the voting securities of such entity, any Company-sponsored employee stock ownership plan or any other employee benefit plan of the Company either files or becomes obligated to file a report with the Securities and Exchange Commission under the Exchange Act disclosing beneficial ownership by such entity of Voting Stock in excess of 25% or otherwise or that a change in control of the Company has or may have occurred or will or may occur in the future by reason of such beneficial ownership. Notwithstanding the foregoing provisions of this Section 7(c), a transaction or occurrence identified in Section 7(c) (i), (ii), (iii) or (iv) shall not be deemed to be a Change in Control unless it constitutes a “change in control event” within the meaning of Treasury Regulations Section 1.409A-3(i)(5)(i).
To the Company
Agree Realty Corporation
70 E. Long Lake Road
Bloomfield Hills, MI 48304
Attention: Board of Directors
To the Executive
Attention: Simon Leopold
To the extent permitted by applicable law or the Company’s benefit plans, this Agreement shall supersede any other plan, agreement or arrangement with the Company regarding the Executive’s employment and termination of employment.
(i) With regard to any payment that is considered deferred compensation under Code Section 409A payable on account of a “separation from service,” to the extent required under Code Section 409A such payment shall be made on the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (B) the date of Executive’s death (the “Delay Period”). All payments delayed pursuant to the preceding sentence shall be paid to the Executive in a lump sum on the first business day of the seventh month following the Executive’s “separation from service”, with interest on any such payments calculated using an interest rate not less than the average prime interest rate published in the Wall Street Journal on such payment date; and
(ii) To the extent that any benefits to be provided during the Delay Period are considered deferred compensation under Code Section 409A provided on account of a “separation from service,” and such benefits are not otherwise exempt from Code Section 409A, the Executive shall pay the cost of such benefits during the Delay Period, and the Company shall reimburse the Executive (to the extent that such costs would otherwise have been paid by the Company or to the extent that such benefits would otherwise have been provided by the Company at no cost to the Executive) the Company’s share of the cost of such benefits on the first day of the seventh month following the Executive’s “separation from service” and any remaining benefit shall be provided by the Company following expiration of the Delay Period in accordance with the procedures specified herein. The payments described in this paragraph shall be made with interest, calculated using an interest rate not less than the average prime interest rate published in the Wall Street Journal on such payment date.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date set forth below.
AGREE REALTY CORPORATION
By: /s/ Joel Agree
Name: Joel Agree
Title: President and Chief Executive Officer
Date: February 19, 2021
By: /s/ Simon Leopold
Name: Simon Leopold
Date: February 19, 2021
[Preliminary Compensation Plan Example]