Exhibit 10.3


 


EMPLOYMENT AGREEMENT


 


This
Employment Agreement (the “Agreement”), effective as of August 9, 2004, is
by and between LTC Properties, Inc.,
a corporation organized under the laws of the State of Maryland (“LTC” or the “Company”),
and Clint Malin (“Executive”).


 


NOW
THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto agree as follows:


 


1.                                       Appointment, Title and Duties. 
LTC hereby employs Executive to serve as its Vice President and Chief
Investment Officer.  In such capacity,
Executive shall report to the Chief Executive Officer of the Company, and shall
have such duties, powers and responsibilities as are customarily assigned to a
Vice President and Chief Investment Officer of a publicly held corporation, but
shall also be responsible to the Board of Directors and to any committee
thereof.  In addition, Executive shall
have such other duties and responsibilities as the Chief Executive Officer may
assign him, with his consent, including serving with the consent or at the
request of the Chief Executive Officer as an officer or on the board of
directors of affiliated corporations.


 


2.                                       Term of Agreement. 
The term of this Agreement shall commence as of the date hereof and
shall extend such that at each and every moment of time hereafter the remaining
term shall be one year.


 


3.                                       Acceptance of Position. 
Executive accepts the position of Vice President and Chief Investment
Officer of LTC, and agrees that during the term of this Agreement he will
faithfully perform his duties and, except as expressly approved by the Board of
Directors of LTC, will devote substantially all of his business time to the
business and affairs of LTC, and will not engage, for his own account or for
the account of any other person or entity, in a business which competes with
LTC.  It is acknowledged and agreed that
Executive may serve as an officer and/or director of companies in which LTC
owns voting or non-voting stock.  In
addition, it is acknowledged and agreed that Executive may, from time to time,
serve as a member of the board of directors of other companies, in which event
the Board of Directors of LTC must expressly approve such service pursuant to a
Board resolution maintained in the Company’s minute books.  Any compensation or remuneration which
Executive receives in consideration of his service on the board of directors of
other companies shall be the sole and exclusive property of Executive, and LTC
shall have no right or entitlement at any time to any such compensation or
remuneration.


 


4.                                       Salary and Benefits. 
During the term of this Agreement:


 


(a)                                  LTC shall pay to Executive a base salary
at an annual rate of not less than One Hundred Fifty Thousand Dollars
($150,000) per annum (“Base Salary”), paid in approximately equal installments
at intervals based on any reasonable Company policy.  LTC agrees from time to time to consider
increases in such base salary in the discretion of the Board of Directors.  Any increase, once granted, shall automatically
amend this Agreement to provide that thereafter Executive’s base salary shall
not be less than the annual amount to which such base salary has been
increased.


 


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(b)                                 Executive shall participate in all health,
retirement, Company-paid insurance, sick leave, disability, expense
reimbursement and other benefit programs which LTC makes available to any of
its senior executives, and shall be eligible for bonuses in the discretion of
the Board of Directors.


 


(c)                                  Executive shall be entitled to reasonable
vacation time, not less than two (2) weeks per year.


 


5.                                       Certain Terms Defined. 
For purposes of this Agreement:


 


(a)                                  Executive shall be deemed to be “disabled”
if a physical or mental condition shall occur and persist which, in the written
opinion of a licensed physician selected by the Board of Directors in good
faith, has rendered Executive unable to perform the duties set forth in Section 1
hereof for a period of sixty (60) days or more and, in the written opinion of
such physician, the condition will continue for an indefinite period of time,
rendering Executive unable to return to his duties;


 


(b)                                 A termination of Executive’s employment
by LTC shall be deemed for “Cause” if, and only if, it is based upon (i) conviction
of a felony; (ii) material disloyalty to the Company such as embezzlement,
misappropriation of corporate assets or, except as permitted pursuant to Section 3
of this Agreement, breach of Executive’s agreement not to engage in business
for another enterprise of the type engaged in by the Company; or (iii) the
engaging in unethical or illegal behavior which is of a public nature, brings
LTC into disrepute, and results in material damage to the Company.  The Company shall have the right to suspend Executive
with pay, for a reasonable period to investigate allegations of conduct which,
if proven, would establish a right to terminate this Agreement for Cause, or to
permit a felony charge to be tried. 
Immediately upon the conclusion of such temporary period, unless Cause
to terminate this Agreement has been established, Executive shall be restored
to all duties and responsibilities as if such suspension had never occurred;


 


(c)                                  A resignation by Executive shall not be
deemed to be voluntary and shall be deemed to be a resignation with “Good
Reason” if it is based upon (i) a diminution in Executive’s title, duties,
or salary; (ii) a reduction in benefits which is not part of an across-the-board
reduction in benefits of all executive personnel; (iii) a direction by the
Board of Directors that Executive report to any person or group other than the
Chief Executive Officer or the Board of Directors, or (iv) a geographic
relocation of Executive’s place of work a distance for more than seventy-five
(75) miles from LTC’s offices located at 22917 Pacific Coast Hwy, Suite 350,
Malibu, California;


 


(d)                                 “Affiliate” means with respect to any
Person, a Person who, directly or indirectly, through one or more
intermediaries, controls, is controlled by or is under common control, with the
Person specified;


 


(e)                                  “Base Salary” means, as of any date of
termination of employment, the highest base salary of Executive in the then
current fiscal year or in any of the last four fiscal years immediately
preceding such date of termination of employment;


 


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(f)                                    “Beneficial Owner” shall have the meaning
given to such term in Rule 13d-3 under the Exchange Act;


 


(g)                                 A “Change in Control” occurs if:


 


(i)                                     Any Person or related group of Persons
(other than Executive and his Related Persons, the Company or a Person that
directly or indirectly controls, is controlled by, or is under common control
with, the Company) is or becomes the Beneficial Owner, directly or indirectly,
of securities of the Company representing 30% or more of the combined voting
power of the Company’s then outstanding securities; or


 


(ii)                                  The stockholders of the Company approve a
merger or consolidation of the Company with any other corporation (or other
entity), other than a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 66-2/3% of the combined voting
power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; provided, however, that a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no Person acquires 30% or more of the combined
voting power of the Company’s then outstanding securities shall not constitute
a Change in Control; or


 


(iii)                               The Stockholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company’s assets;
or


 


(iv)                              A majority of the members of the Board of Directors of
the Company cease to be Continuing Directors;


 


(h)                                 “Code” means the Internal Revenue Code of
1986, as amended.


 


(i)                                     “Continuing Directors” means, as of any
date of determination, any member of the Board of Directors who 


(i) was a member of such
Board of Directors on the date of the Agreement or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board of Directors at the
time of such nomination or election.


 


(j)                                     “Exchange Act” means the Exchange Act of
1934, as amended.


 


(k)                                  “Person” means any individual,
corporation, partnership, limited liability company,
trust, association or other entity.


 


(l)                                     “Related Person” means any immediate
family member (spouse, partner, parent, sibling or child whether by birth or
adoption) of the Executive and any trust, estate or foundation, the beneficiary
of which is the Executive and/or an immediate family member of the Executive.


 


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6.                                       Certain Benefits Upon
Termination.  Executive’s employment shall be terminated
upon the earlier of (i) the voluntary resignation of Executive with or
without Good Reason; (ii) Executive’s death or permanent disability; or
(iii) upon the termination of Executive’s employment by LTC for any reason
at any time.  In the event of such
termination, the below provisions of this Section 6 shall apply, and in
the event of a Change in Control, whether or not Executive’s employment is
terminated thereby, Section 6(b) shall apply.


 


(a)                                  If Executive’s employment by LTC
terminates for any reason other than as a result of (i) a termination for
Cause, or (ii) a voluntary resignation by Executive without a Good Reason,
or (iii) a Change in Control of the Company, then LTC shall pay Executive
a lump sum severance payment equal to his Base Salary; provided that if employment terminates by
reason of Executive’s death or disability, then such salary shall be paid only
to the extent the Company has available “key man” life, disability or similar
insurance relating to the death or disability of Executive;


 


(b)                                 Upon a Change in Control of the Company
whether or not Executive’s employment is terminated thereby, in lieu of the
severance payment described in Section 6(a) above, LTC shall pay Executive
a lump sum severance payment in cash equal to his Base Salary, and all stock
options and/or restricted stock shall automatically vest concurrently upon a
Change in Control, notwithstanding any prior existing vesting schedule;


 


(c)                                  If Executive’s employment by LTC
terminates for any reason, except for LTC’s termination of Executive’s
employment for Cause or a voluntary resignation by Executive without a Good
Reason, LTC shall offer to Executive the opportunity to participate in all
Company-provided medical and dental plans to the extent Executive elects and
remains eligible for coverage under COBRA and for a maximum period of eighteen
(18) months at Company expense; provided,
however, in the event Executive’s employment by LTC terminated upon
a Change in Control of the Company, then Executive shall not be given the
opportunity to participate in any of such medical and dental plans, except to
the extent required by law;


 


(d)                                 In the event that Executive’s employment
terminates by reason of his death, all benefits provided in this Section 6
shall be paid to his estate or as his executor shall direct, but payment may be
deferred until Executive’s executor or personal representative has been
appointed and qualified pursuant to the laws in effect in Executive’s
jurisdiction of residence at the time of his death;


 


(e)                                  LTC shall make all payments pursuant to
the foregoing subsections (a) through (d) within seven (7) days following the
date of termination of Executive’s employment or consummation of a Change in
Control of the Company, as applicable;


 


(f)                                    Notwithstanding the foregoing, LTC shall
have no liability under this Section if Executive’s employment pursuant to
this Agreement is terminated by LTC for Cause or by Executive without a Good
Reason; provided, however, that if Executive’s employment pursuant to this
Agreement is terminated by LTC for Cause or by Executive without a Good Reason
at any time after a Change of Control which did not result in Executive’s
employment being terminated, such post-Change of Control termination by LTC for
Cause or by Executive without a Good Reason shall 


 


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not affect in any way Executive’s entitlement to the
lump sum severance payment described in Section 6(b) above or any other
rights, benefits or entitlements to which Executive may be entitled as a result
of such Change of Control;


 


7.                                       Tax Liability Loan. 
Upon a Change in Control of the Company, whether or not Executive’s
employment is terminated as a result thereof, the Company shall offer Executive
an unsecured loan in the amount necessary to fund Executive’s tax liability
arising from the accelerated vesting of restricted shares held by Executive, if
any.  Such loan shall be due, in full, in
ten (10) years from the date made and shall bear interest at the then-current
Applicable Federal Rate (the minimum rate necessary to avoid “unstated interest”
under Section 7872 of the Code) with interest payments to be paid to the
Company annually.  Such loan shall be
evidenced by a promissory note signed by, and with full recourse to, Executive.


 


8.                                       Indemnification. 
LTC shall indemnify Executive and hold him harmless from and against all
claims, actions, losses, damages, expense or liabilities (including expenses of
defense and settlement) (“Claim”) based upon or in any way arising from or
connected with his employment by LTC, to the maximum extent permitted by
law.  To the extent permitted by law, LTC
shall advance to Executive any expenses necessary in connection with the
defense of any Claim which is brought if indemnification cannot be determined
to be available prior to the conclusion of, or the investigation of, such
Claim.  The parties hereto agree that
each understands and has understood that notwithstanding the above-stated
provisions, nothing herein shall require LTC to hold harmless or indemnify
Executive with respect to any Claim which is brought or asserted against
Executive by LTC.  LTC shall investigate
in good faith the availability and cost of directors’ and officers’ insurance
and shall include Executive as an insured in any directors and officers
insurance policy of such insurance it maintains.


 


9.                                       Attorney Fees. 
In the event that any action or proceeding is brought to enforce the
terms and provisions of this Agreement, the prevailing party shall be entitled
to recover reasonable attorney fees.


 


10.                                 Notices.  All notices
and other communications provided to either party hereto under this Agreement
shall be in writing and delivered by certified or registered mail to such party
at its/his address set forth below its/his signature hereto, or at such other
address as may be designated with postage prepaid, shall be deemed given when
received.


 


11.                                 Construction. 
In constructing this Agreement, if any portion of this Agreement shall
be found to be invalid or unenforceable, the remaining terms and provisions of
this Agreement shall be given effect to the maximum extent permitted without
considering the void, invalid or unenforceable provisions.  In construing this Agreement, the singular
shall include the plural, the masculine shall include the feminine and neuter
genders as appropriate, and no meaning in effect shall be given to the captions
of the sections in this Agreement, which are inserted
for convenience of reference only.


 


12.                                 Headings.  The section headings
hereof have been inserted for convenience of reference only and shall not be
construed to affect the meaning, construction or effect of this Agreement.


 


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13.                                 Governing Law. 
The provisions of this Agreement shall be construed and interpreted in
accordance with the internal laws of the State of California as at the time in
effect.


 


14.                                 Entire Agreement. 
This Agreement constitutes the entire agreement and supersedes all other
prior agreements and undertakings, both written and oral, among Executive and
the Company, with respect to the subject matter hereof.


 


IN
WITNESS WHEREOF, this Agreement shall be effective as of the date specified in
the first paragraph of this Agreement.


 


 


	
   

  	
   

  	
   

  	
  LTC
  PROPERTIES, INC.,

  a Maryland corporation

  
	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
  22917 Pacific Coast Hwy

  Suite 350

  	
   

  	
    /s/ Andre C. Dimitriadis

  	
   

  
	
   

  	
  Malibu, California 90265

  	
   

  	
    Andre C. Dimitriadis 

  
	
   

  	
   

  	
   

  	
    Chairman and Chief Executive
  Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
    /s/ Edmund C. King

  	
   

  
	
   

  	
   

  	
   

  	
    Compensation Committee Representative

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
  1010
  Pacific Street, Unit A

  	
   

  	
    /s/ Clint Malin

  	
   

  
	
   

  	
  Santa
  Monica, CA 90405

  	
   

  	
    Clint Malin

  
						



 


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