Document:

Exhibit
10.5

 

RESIGNATION AND RELEASE AGREEMENT

 

 

This RESIGNATION AND
RELEASE AGREEMENT (the “Agreement”), dated as of October 15, 2003, by
and between Price Legacy Corporation, a Maryland corporation (the “Company”),
and Graham R. Bullick (the “Executive”).  Price Legacy and the Executive are each referred to herein
sometimes as a “Party” and collectively as the “Parties.”

 

RECITALS

 

 

WHEREAS, the Executive
has been employed as President and Chief Operating Officer of the Company
pursuant to the Employment Agreement between the Executive and the Company
dated as of April 7, 2003 (the “Employment Agreement”);

 

WHEREAS, the Company and
the Executive and Gary B. Sabin, Richard B. Muir and S. Eric Ottesen have
entered into a Master Separation Agreement (the “Master Separation Agreement”),
pursuant to which, among other things, the Executive and the Company have
agreed that the Executive shall resign from his employment with the Company and
each of subsidiaries and affiliates, on the terms and conditions set forth in
this Agreement.

 

AGREEMENT

 

 

NOW, THEREFORE, the
Company and the Executive, in consideration of the covenants herein set forth,
and for other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged, hereby agree as follows:

 

1.     Effective Date

 

This Agreement shall
become effective upon the occurrence of both of the following events (the date
of such occurrence, the “Effective Date”):  (i) execution of this Agreement by the Parties and (ii)
expiration of the revocation period set forth in Section 11 below without the
Executive’s having given notice of revocation. 
Until and unless both of the foregoing events occur, this Agreement
shall be null and void and the Employment Agreement shall continue in full
force and effect.  Upon the occurrence
of the foregoing events, the Employment Agreement shall be superseded entirely
by this Agreement and the Employment Agreement shall be of no further force or
effect.

 

2.     Resignation of Employment and Directorships

 

The Executive  hereby
resigns, effective as of the date hereof (the “Resignation Date”), from
his employment with the Company, from his positions as President and Chief
Operating Officer of the Company and from all other positions the Executive may
currently hold as an officer or member of the board of directors or trustees
(or any committee thereof) of the Company or any of the Company’s direct or
indirect majority-owned subsidiaries, including without limitation the entities
listed on Schedule I hereto (the Company and all of its direct or indirect
majority-owned subsidiaries (including corporations, partnerships, limited
liability

 

 

companies, joint ventures and other entities) being
hereinafter referred to collectively as the “Price Legacy Entities”).  The Executive shall promptly sign and
deliver to the Company such other documents as the Company may reasonably
determine to be necessary to effect or reflect such resignations.

 

3.     Severance Payments, Benefits and Obligations

 

(a)           On or about the
Effective Date, the Company shall pay to the Executive his base salary and
accrued and unpaid vacation pay through the Resignation Date to the extent it
has not previously been paid.  In lieu
of and in satisfaction of any severance or other payments due under any
severance or other benefit plans maintained by any of the Price Legacy
Entities, or any individual agreement previously entered into with the
Executive by any of the Price Legacy Entities, including without limitation the
Employment Agreement, the Company shall provide the Executive with the payments
and benefits set forth in Sections 3(b) through (f) below.  The Executive will not be entitled to any
additional compensation or benefits from the Company or any other Price Legacy
Entity, except as specifically provided in this Agreement.

 

(b)           The Executive
acknowledges and agrees that Gary Sabin has exercised his right to purchase
from the Company all of its right, title and interest in and to the Master
Lease, Note Receivable, Option Agreement and Put Option Agreement by and
between the Company and Rose Canyon Business Park LP, dated as of December 12,
2000, and that as a result of such right being exercised the Executive has
agreed forgo and waive any right the Executive may have under the Employment
Agreement to receive any severance payments under Section 8(a)(iii) thereof.

 

(c)           Until the first
anniversary of the Resignation Date, the Executive and his eligible spouse and
dependents shall continue to be eligible to receive the benefits that they
would have continued to receive under the Company’s medical, hospitalization,
dental, and life insurance plans, practices and programs, if the Executive had
remained employed by the Company, at the level in effect and upon substantially
the same terms and conditions (including without limitation contributions
required to be made by the Executive for such benefits, and subject to the
Executive’s making such contributions) as are in effect from time to time for
active Company employees; provided, that if and to the extent that the
Executive, his eligible spouse and his eligible dependents cannot continue to
participate in the Company programs providing such benefits, the Company shall
arrange to provide them with the economic equivalent of such benefits that they
would otherwise be entitled to receive; and provided  further,
that the foregoing benefits shall terminate if and to the extent that the
Executive becomes eligible to receive substantially equivalent benefits under
the plans and programs of any subsequent employer (determined on a
benefit-by-benefit basis).  Medical and
dental benefits under this subparagraph may be provided by the Company’s
payment of a portion of the Executive’s premiums for continued health coverage
under Section 4980B of Internal Revenue Code of 1986, as amended, and in any
event the “qualifying event” that gives rise to the right of the Executive and
his eligible spouse and eligible dependents to such continued health coverage
shall be deemed to occur on the Resignation Date.

 

(d)           All options to purchase
shares of common stock of the Company granted to the Executive prior to the
Resignation Date shall be and become fully vested and exercisable on the

 

2

 

Effective Date and shall continue to be outstanding
and exercisable and the expiration of such options shall be extended to the
first anniversary of the Resignation Date.

 

(e)           The Executive shall be
entitled to any other rights, compensation and/or benefits as may be due to the
Executive in accordance with the terms of the Company’s 401(k) plan.

 

(f)            Within seven (7) days
following the Executive’s execution of this Agreement, the Executive shall
submit expense reports documenting all business-related expenses which have
already been incurred for which the Executive seeks reimbursement that the
Company has not yet paid, and thereafter will submit such expenses within seven
(7) days of the date in which they are incurred.  The Company will review the expense reports and, subject to
proper documentation and verification that the expenses were business-related,
reimburse the Executive in accordance with Company policy.  No other expenses incurred by the Executive
prior to the Resignation Date will be reimbursed.

 

4.     Disparaging Comments

 

From and after the date
of this Agreement, except as may be required by a court or governmental body,
each of the Executive and the Company shall, and the Company shall cause each
of its subsidiaries and affiliates, and use its reasonable efforts to cause its
directors, officers and employees, to, refrain from taking actions or making
statements, written or oral, which disparage or defame the goodwill or
reputation of, the Price Legacy Entities and their trustees, officers, agents
and former and current employees and directors, or the Executive, respectively,
or which are intended to, or may be reasonably expected to, adversely affect
the morale of the employees of any of the Price Legacy Entities and their
trustees, officers, agents and former and current employees and directors, or the
Executive, respectively.  The Executive
further agrees not to make any negative statements, written or oral, to third
parties relating to his employment or any aspect of the business of the Price
Legacy Entities and not to make any statements, written or oral, to third
parties about the circumstances of his resignation, except as may be required
by a court or governmental body, or as may merely repeat any of the matters
contained in the press release of the Company issued on or about the date
hereof.

 

5.     Confidentiality of this Agreement

 

Except as required by law
or regulation or as otherwise agreed to by the Parties, none of the Parties
hereto will disclose the terms of this Agreement, provided that the
Executive may disclose such terms to his financial and legal advisors and his
spouse and the Company may disclose such terms to selected employees, advisors
and affiliates on a “need to know” basis, each of whom shall be instructed by
the Executive and the Company, as the case may be, to maintain the terms of
this Agreement in strict confidence in accordance with the terms hereof.

 

6.     Additional
Covenants

 

The Company hereby agrees
that the restrictions contained in the Employment Agreement on the Executive’s
ability either to engage in any activities directly or indirectly, in
competition with the Company or to make any investment in competition with the
Company are eliminated as of the Effective Date, and the Company shall execute
all document necessary or reasonably requested by the Executive to reflect such
elimination of restrictions.

 

3

 

7.     Waiver of Other Payments and Benefits

 

The compensation and
benefits arrangements set forth in this Agreement are in lieu of any rights or
claims that the Executive may have with respect to severance or other vested
benefits, or any other form of remuneration from the Price Legacy Entities,
other than benefits under any tax-qualified employee pension benefit plans
subject to the Employee Retirement Income Security Act of 1974, as amended
(including the Company’s 401(k) plan), and without limiting the generality of
the foregoing, the Executive hereby expressly waives any right or claim that he
may have or could assert to payment for salary, bonuses, medical, dental or hospitalization
benefits, payments under supplemental retirement plans and incentive plans,
life insurance benefits and attorneys’ fees, except as otherwise provided in
this Agreement or as mandated under applicable law.

 

8.     Information Requests/Cooperation

 

The Executive agrees to
make himself, and agrees to use reasonable efforts to cause representatives of
any joint venture partners with which the Company has a business relationship
prior to the date hereof to be, reasonably available to the Company for a two-year
period from the Resignation Date to respond to requests by the Company for
information concerning matters involving facts or events relating to the
Company or any other Price Legacy Entity that may be within the Executive’s
knowledge, and to assist the Company and the Price Legacy Entities as
reasonably requested with respect to pending and future litigations,
arbitrations or other dispute resolutions; provided, that, to the extent
the Executive can reasonably comply with the foregoing requirements, he shall
be entitled to do so via telephone.  The
Company will reimburse the Executive for his reasonable travel expenses and
out-of-pocket costs incurred as a result of his assistance under this Section
8.

 

9.     No Admission of Wrongdoing

 

Nothing contained in this
Agreement shall be construed in any way as an admission by any of the Parties
of any act, practice or policy of discrimination or breach of contract either
in violation of applicable law or otherwise.

 

10.   Waiver and Release by the Executive

 

(a)           In consideration of the
payments and benefits set forth in this Agreement, except for the payment and
benefits expressly provided herein, the Executive, for himself, his heirs,
administrators, representatives, executors, successors and assigns (collectively
“Releasors”) does hereby irrevocably and unconditionally release, acquit
and forever discharge the Price Legacy Entities and their trustees, officers,
affiliates, agents, and former and current employees and directors, and their
successors, executors and assigns, including without limitation all persons
acting by, through, under or in concert with any of them (collectively, “Releasees”),
from any and all charges, complaints, claims, liabilities, obligations,
promises, agreements, controversies, damages, remedies, actions, causes of
action, suits, rights, demands, costs, losses, debts and expenses (including
attorneys’ fees and costs) (collectively, “Claims”) of any nature
whatsoever, known or unknown, whether in law or equity and whether arising
under federal, state or local law, which the Releasors had, now have, or may
have in the future as a result of any facts or

 

4

 

circumstances currently existing or which may have
existed in the past (including, without limitation, any and all matters arising
from the Executive’s employment by or service with the Company), but excluding
any Claims arising from any action to enforce the Company’s obligations under
this Agreement, the Master Separation Agreement or any other agreement or
instrument entered into and delivered under this Agreement or the Master
Separation Agreement, against each or any of the Releasees (collectively, the “Released
Claims”).  The Executive
acknowledges and agrees that if he or any other Releasor should hereafter make
any claim or demand or commence or threaten to commence any action, claim or
proceeding against the Releasees with respect to any cause, matter or thing
which is the subject of this Section 10(a), this Agreement may be raised as a
complete bar to any such action, claim or proceeding, and the applicable
Releasee may recover from the Executive all costs incurred in connection with
such action, claim or proceeding, including attorneys’ fees.

 

(b)           With respect to any and
all Released Claims, the Executive stipulates and agrees that, upon execution
of this Agreement, Releasors shall be deemed to have expressly waived and
relinquished, to the fullest extent permitted by law, the provisions, rights,
and benefits of Section 1542 of the California Civil Code, which provides:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.

 

The Releasors, upon
execution of this Agreement, shall be deemed to have waived any and all
provisions, rights and benefits conferred by any law of any state or territory
of the United States, or principle of common law, which is similar, comparable
or equivalent to Section 1542 of the California Civil Code.  The Releasors may hereafter discover facts
in addition to or different from those which he, she or it now knows or
believes to be true with respect to the subject matter of the Released Claims,
but each Releasor, upon the execution of this Agreement by the Executive, shall
be deemed to have fully, finally, and forever settled and released any and all
Released Claims, known or unknown, suspected or unsuspected, contingent or
noncontingent, whether or not concealed or hidden, which now exist, or
heretofore have existed upon any theory of law or equity now existing or coming
into existence in the future, including, but not limited to, conduct which is
negligent, intentional, with or without malice, or a breach of any duty, law or
rule, without regard to the subsequent discovery or existence of such different
or additional facts.

 

(c)           The Executive affirms
that he has been represented by counsel in connection with the negotiation and
execution of this Agreement and the waiver and release in Section 10(a).

 

(d)           THE EXECUTIVE
ACKNOWLEDGES AND UNDERSTANDS THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL
KNOWN AND UNKNOWN CLAIMS.

 

11.   Older Workers Benefit Protection Act

 

In accordance with the
Older Workers Benefit Protection Act of 1990, the Executive acknowledges that:

 

5

 

(a)           This Agreement includes
a waiver and release of the Executive’s claims under the Age Discrimination in
Employment Act, 29 U.S.C. § 621 et seq.

 

(b)           The Executive has the
right to consult with an attorney before signing this Agreement.

 

(c)           The Executive has
twenty-one (21) days to consider this Agreement but he may waive that period by
signing it earlier.

 

(d)           The Executive has seven
(7) days after signing this Agreement to revoke this Agreement and this
Agreement will not be effective until that revocation period has expired.  Notice of revocation must be delivered by
fax or e-mail to the Chairman of the Board of Directors of the Company.

 

12.   Waiver and Release by the Company

 

(a)           In consideration of the
matters set forth in this Agreement, except for the payment and benefits
expressly provided herein, the Price Legacy Entities, for themselves and their
successors and assigns (collectively “Price Legacy Releasors”) does
hereby irrevocably and unconditionally release, acquit and forever discharge
the Executive and his successors, executors and assigns, including without
limitation all persons acting by, through, under or in concert with any of them
(collectively, “Price Legacy Releasees”), from any and all Claims of any
nature whatsoever, known or unknown, whether in law or equity and whether
arising under federal, state or local law which the Price Legacy Releasors had,
now have, or may have in the future as a result of any facts or circumstances
currently existing or which may have existed in the past (including, without
limitation, any and all matters arising from the Executive’s employment by or
service with the Company), against each or any of the Price Legacy Releasees
(collectively, the “Price Legacy Released Claims”); provided that
the Price Legacy Released Claims shall not include either (x) any Claims
arising from any action to enforce the Executive’s obligations under this Agreement,
the Master Separation Agreement or any other agreement or instrument entered
into and delivered under this Agreement or the Master Separation Agreement or
(y) any Claims as to which indemnification of a director or officer of the
Company would be unavailable under Maryland law.  The Company acknowledges and agrees that if it or any other Price
Legacy Releasor should hereafter make any claim or demand or commence or
threaten to commence any action, claim or proceeding against the Price Legacy
Releasees with respect to any cause, matter or thing which is the subject of
this Section 12(a), this Agreement may be raised as a complete bar to any such
action, claim or proceeding, and the applicable Price Legacy Releasee may
recover from the Company all costs incurred in connection with such action,
claim or proceeding, including attorneys’ fees.  In addition, to the
extent the Company’s consent is required under the formation or organizational
documents of partnerships and/or joint ventures to which the Company is a
party, the Company agrees not to consent to the assertion of any Claims against
Executive by such partnerships or joint ventures, subject to the exceptions
contained in the first sentence of this Section 12.

 

(b)           With respect to any and
all Price Legacy Released Claims, the Company stipulates and agrees that, upon
execution of this Agreement, the Price Legacy Releasors shall be

 

6

 

deemed to have expressly waived and relinquished, to
the fullest extent permitted by law, the provisions, rights, and benefits of Section
1542 of the California Civil Code, which provides:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.

 

The Price Legacy
Releasors, upon execution of this Agreement, shall be deemed to have waived any
and all provisions, rights and benefits conferred by any law of any state or
territory of the United States, or principle of common law, which is similar,
comparable or equivalent to Section 1542 of the California Civil Code.  The Price Legacy Releasors may hereafter
discover facts in addition to or different from those which he, she or it now
knows or believes to be true with respect to the subject matter of the Price
Legacy Released Claims, but each Price Legacy Releasor, upon the execution of
this Agreement by the Company, shall be deemed to have fully, finally, and
forever settled and released any and all Price Legacy Released Claims, known or
unknown, suspected or unsuspected, contingent or noncontingent, whether or not
concealed or hidden, which now exist, or heretofore have existed upon any
theory of law or equity now existing or coming into existence in the future,
including, but not limited to, conduct which is negligent, intentional, with or
without malice, or a breach of any duty, law or rule, without regard to the
subsequent discovery or existence of such different or additional facts.

 

13.   Confidential Information

 

The Executive understands
and acknowledges that during the course of his employment by the Price Legacy
Entities, he has had access to and has become acquainted with trade secrets and
other confidential information of the Price Legacy Entities (which shall
include, but not be limited to, financial information, business plans,
marketing plans and proposals, compilations of information, business and
employee records, publication information and vendor information, but shall not
include contact information for business relationships developed by the
Executive during his employment with the Price Legacy Entities and standard
form agreements regularly used in the operation of the business of the Price Legacy
Entities) which are owned by the Price Legacy Entities and which are regularly
used in the operation of the business of the Price Legacy Entities.  The Executive further understands and
acknowledges that despite termination of his employment with the Price Legacy
Entities, he has a continuing legal obligation not to disclose, and not to use,
directly or indirectly, any such trade secrets or confidential information
owned by the Price Legacy Entities.

 

14.   Public Statement

 

The Parties agree that
the Executive’s resignation of his employment was announced by the Company on
September 22, 2003, and that no subsequent comments shall be made to the media
or through other public statements by any Party hereto regarding the
Executive’s resignation of his employment that are inconsistent with such
statement, except as may be required by applicable law or regulation.

 

7

 

15.   No Reliance

 

The Executive represents
and acknowledges that, in executing this Agreement, he has not relied upon any
representation or statement made by the Company not set forth herein.

 

16.   Return of Company Property

 

Except as previously
agreed between the Parties, on the Effective Date, the Executive shall return
in good working order any equipment or other property belonging to the Company.

 

17.   Governing Law

 

(a)           This Agreement shall be
governed by and construed in accordance with the laws of the State of
California, without regard to the principles of conflicts of law thereof, to
the extent not superseded by applicable federal law.  It is the intention of the Parties that any dispute or litigation
arising out of the negotiation, existence, performance, interpretation or
enforcement of this Agreement shall be determined only by the Courts of the
State of California (including the federal courts located in the State of
California), and no other court or tribunal. 
THE PARTIES HERETO HEREBY AGREE THAT ANY DISPUTE CONCERNING FORMATION,
MEANING, APPLICABILITY, ENFORCEMENT OR INTERPRETATION OF THIS AGREEMENT SHALL
BE SUBMITTED TO THE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA
(INCLUDING FEDERAL COURTS IN THE STATE OF CALIFORNIA), AND NO OTHER STATE SHALL
HAVE JURISDICTION OVER SUCH MATTERS, AND FURTHER AGREE TO WAIVE ALL RIGHTS TO A
JURY TRIAL WITH RESPECT TO ANY SUCH MATTERS. 
WITH RESPECT TO ANY SUCH DISPUTE, ALL PARTIES HERETO AGREE TO WAIVE ANY
DEFENSES OR OBJECTIONS THEY MAY HAVE TO THE PERSONAL JURISDICTION OVER THEM OF
THE AFORESAID CALIFORNIA COURTS, AND THE EXECUTIVE AGREES THAT SERVICE OF
PROCESS UPON HIM BY MAIL AT THE ADDRESS CONTAINED HEREIN SHALL BE GOOD AND
SUFFICIENT PERSONAL SERVICE, AND THAT SUCH SERVICE SHALL BE DEEMED TO HAVE BEEN
MADE UPON HIM AS IF HE WERE PERSONALLY SERVED AT A LOCATION WITHIN THE STATE OF
CALIFORNIA.

 

(b)           If either
Party brings an action to enforce its rights under this Agreement, the
prevailing Party in the action, at such time as the action is binding, final
and no longer appealable, shall be entitled to recover its costs and expenses,
including, without limitation, reasonable attorneys’ fees, incurred in
connection with such action, including any appeal of such action.

 

18.   Warranty

 

The Parties hereto
represent and warrant that there exists no impediment or restraint, contractual
or otherwise on their power, right or ability to enter into this Agreement and
to perform their duties and obligations hereunder or as contemplated hereby.

 

8

 

19.   Taxes

 

All payments made and
benefits provided to the Executive under this Agreement shall be reduced by, or
the Executive will otherwise pay, all required withholding, employment and
Medicare taxes applicable to the Executive.

 

20.   No Coercion

 

The Parties hereto
represent and acknowledge that they have decided to enter into this Agreement
voluntarily, knowingly and without coercion of any kind.

 

21.   Enforceability; Severability

 

The Parties hereto
affirmatively acknowledge that this Agreement, and each of its provisions, is
enforceable, and expressly agree not to challenge nor raise any defense against
the enforceability of this Agreement or any of its provisions in the
future.  In the event that any provision
or portion of this Agreement shall be determined to be invalid or unenforceable
for any reason, the remaining provisions or portions of this Agreement shall be
unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.

 

22.   Notices

 

All notices, requests,
demands and other communication which are required or may be given under this
Agreement shall be in writing and shall be deemed to have been duly given when
received if personally delivered; when transmitted by telecopy, electronic or
digital transmission method upon receipt of telephonic or electronic
confirmation; the day after it is sent, if sent for next day delivery to a
domestic address by recognized overnight delivery service (e.g., Federal
Express) and upon receipt, if sent by certified or registered mail, return
receipt requested.  In each case notice
shall be sent to:

 

If to the Executive,
addressed to:

 

Graham R. Bullick

17140 Bernardo Height Drive, Suite 310

San Diego, California 92128

Fax:         (858)
487-9890

 

If to the Company,
addressed to:

 

Price Legacy Corporation

17140 Bernardo Height Drive, Suite 300

San Diego, California 92128

Attention:  Chief Executive Officer

Fax:         (858)
675-9405

 

or to such other place
and with such other copies as any Party may designate as to itself or himself
by written notice to the others.

 

9

 

23.   Amendments; Waivers

 

This Agreement may not be
amended, modified or terminated, except by a written instrument signed by the
Parties hereto.  Any provision of this
Agreement may be waived by a written instrument signed by the Party to be charged
with such waiver. No waiver by any Party hereto at any time of any breach of,
or compliance with, any condition or provision of this Agreement to be
performed by any other Party hereto shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.

 

24.   Successors

 

This Agreement shall be
binding on the Executive, the Company and their respective heirs, successors
and assigns, including without limitation any corporation or other entity into
which the Company may be merged, reorganized or liquidated, or by which the
Company may be acquired.  The
obligations of the Company may be assigned without limitation, provided
that the Company shall remain liable for the payment obligations under Section 2;
but, as the obligations to be performed by the Executive hereunder are unique
based upon his skills and qualifications, the Executive’s obligations under
this Agreement may not be assigned.

 

25.   Entire Agreement

 

Except as specified
herein, this Agreement contains the entire agreement between the Parties
concerning the subject matter hereof and supersedes all prior agreement,
understandings, discussions, negotiations and undertakings, whether written or
oral, between the Parties with respect thereto.

 

26.   Counterparts

 

This Agreement may be
executed in several counterparts, each of which shall be deemed to be an
original, but all of which together will constitute one and the same Agreement.

 

10

 

IN WITNESS WHEREOF, the
Parties have executed this Agreement, as of the date and year first written
above.

 

	
   

  	
  PRICE LEGACY
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jack McGrory

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Jack McGrory

  
	
   

  	
   

  	
  Title:

  	
  CEO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/Graham R.
  Bullick, Ph.D.

  	
   

  
	
   

  	
   

  	
  Graham R.
  Bullick, Ph.D.

  
					

 

11

 

Schedule
1

 

PRICE
LEGACY ENTITIES

 

	
  Entity

  	
   

  	
  Position

  
	
   

  	
   

  	
   

  
	
  Anaheim GardenWalk, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  William J. Stone, Manager

  S. Eric Ottesen, Manager

  
	
   

  	
   

  	
   

  
	
  Campers Villages,  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Destination Villages,
  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Destination Villages
  Daniel’s Head, Bermuda Ltd.

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Destination Villages
  Kauai, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  EPA Properties, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Graham R. Bullick, Manager

  
	
   

  	
   

  	
   

  
	
  Excel Legacy Corporation

  	
   

  	
  Richard B. Muir, President & CEO

  S. Eric Ottesen, SVP and Asst. Secretary

  
	
   

  	
   

  	
   

  
	
  Excel Legacy Holdings, Inc.

  	
   

  	
  Richard B. Muir, President & CEO

  S. Eric Ottesen, SVP and Asst. Secretary

  
	
   

  	
   

  	
   

  
	
  FAEX – HP, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  
	
   

  	
   

  	
   

  
	
  FAEX – SC, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  
	
   

  	
   

  	
   

  
	
  Grand Tusayan, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  LSGW Invesments, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  
	
   

  	
   

  	
   

  
	
  Millennia Car Wash, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Newport on the Levee,
  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  Graham R. Bullick, Manager

  
	
   

  	
   

  	
   

  
	
  Old Mill District
  Shops, LLC

  	
   

  	
  William J. Stone,
  Manager

  
	
   

  	
   

  	
   

  
	
  Orlando Business Park,
  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Orlando Business Park
  CD, Inc.

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  

 

12

 

	
  Entity

  	
   

  	
  Position

  
	
   

  	
   

  	
   

  
	
  PL - Mesa,  Inc

  	
   

  	
  Graham R. Bullick,
  Pres., CEO & Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PL - Groves,  Inc.

  	
   

  	
  Graham R. Bullick,
  Pres., CEO & Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Cross County, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Cypress Creek, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Dulles, Inc.

  	
   

  	
  Richard B. Muir, Pres.

  Graham R. Bullick, Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Kendale, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Millenia, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC OBC, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Oakwood Plaza, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PRICE LEGACY CORPORATION

  	
   

  	
  Gary B. Sabin, CEO & Director

  Richard B. Muir, Vice Chairman

  Graham R. Bullick, SVP

  S. Eric Ottesen, SVP

  William J. Stone, SVP

  
	
   

  	
   

  	
   

  
	
  Price Owner Corp.

  	
   

  	
  Richard B. Muir, Pres.
  & CEO

  S. Eric Ottesen, SVP & Secretary

  
	
   

  	
   

  	
   

  
	
  Price Owner LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Price Self Storage,
  Inc.

  	
   

  	
  Gary B. Sabin, Pres.,
  CEO & Director

  Richard B. Muir, EVP, Secretary & Director

  S. Eric Ottesen, SVP

  
	
   

  	
   

  	
   

  
	
  TenantFirst Real Estate

  	
   

  	
  Richard B. Muir,
  President

  S. Eric Ottesen, SVP

  
	
   

  	
   

  	
   

  
	
  Yosemite Village, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Anaheim GardenWalk, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  William J. Stone, Manager

  

 

13Exhibit
10.6

 

RESIGNATION AND RELEASE AGREEMENT

 

 

This RESIGNATION AND
RELEASE AGREEMENT (the “Agreement”), dated as of October 15, 2003, by
and between Price Legacy Corporation, a Maryland corporation (the “Company”),
and S. Eric Ottesen (the “Executive”). 
Price Legacy and the Executive are each referred to herein sometimes as
a “Party” and collectively as the “Parties.”

 

RECITALS

 

 

WHEREAS, the Executive
has been employed as Senior Vice President, General Counsel and Secretary of
the Company pursuant to the Employment Agreement between the Executive and the
Company dated as of April 7, 2003 (the “Employment Agreement”);

 

WHEREAS, the Company and
the Executive and Gary B. Sabin, Richard B. Muir and Graham R. Bullick have
entered into a Master Separation Agreement (the “Master Separation Agreement”),
pursuant to which, among other things, the Executive and the Company have
agreed that the Executive shall resign from his employment with the Company and
each of subsidiaries and affiliates, on the terms and conditions set forth in
this Agreement.

 

AGREEMENT

 

 

NOW, THEREFORE, the
Company and the Executive, in consideration of the covenants herein set forth,
and for other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged, hereby agree as follows:

 

1.     Effective Date

 

This Agreement shall
become effective upon the occurrence of both of the following events (the date
of such occurrence, the “Effective Date”):  (i) execution of this Agreement by the Parties and (ii)
expiration of the revocation period set forth in Section 11 below without the
Executive’s having given notice of revocation. 
Until and unless both of the foregoing events occur, this Agreement
shall be null and void and the Employment Agreement shall continue in full
force and effect.  Upon the occurrence
of the foregoing events, the Employment Agreement shall be superseded entirely
by this Agreement and the Employment Agreement shall be of no further force or
effect.

 

2.     Resignation of Employment
and Directorships

 

The Executive  hereby
resigns, effective as of the date hereof (the “Resignation Date”), from
his employment with the Company, from his positions as Senior Vice President,
General Counsel and Secretary of the Company and from all other positions the
Executive may currently hold as an officer or member of the board of directors
or trustees (or any committee thereof) of the Company or any of the Company’s
direct or indirect majority-owned subsidiaries, including without limitation
the entities listed on Schedule I hereto (the Company and all of its direct or
indirect majority-owned subsidiaries (including corporations, partnerships,
limited liability

 

 

companies, joint ventures and other entities) being
hereinafter referred to collectively as the “Price Legacy Entities”).  The Executive shall promptly sign and
deliver to the Company such other documents as the Company may reasonably
determine to be necessary to effect or reflect such resignations.

 

3.     Severance Payments,
Benefits and Obligations

 

(a)   On or about the Effective Date,
the Company shall pay to the Executive his base salary and accrued and unpaid
vacation pay through the Resignation Date to the extent it has not previously
been paid.  In lieu of and in satisfaction
of any severance or other payments due under any severance or other benefit
plans maintained by any of the Price Legacy Entities, or any individual
agreement previously entered into with the Executive by any of the Price Legacy
Entities, including without limitation the Employment Agreement, the Company
shall provide the Executive with the payments and benefits set forth in
Sections 3(b) through (f) below.  The
Executive will not be entitled to any additional compensation or benefits from
the Company or any other Price Legacy Entity, except as specifically provided
in this Agreement.

 

(b)   The Executive acknowledges and
agrees that Gary Sabin has exercised his right to purchase from the Company all
of its right, title and interest in and to the Master Lease, Note Receivable,
Option Agreement and Put Option Agreement by and between the Company and Rose
Canyon Business Park LP, dated as of December 12, 2000, and that as a result of
such right being exercised the Executive has agreed forgo and waive any right
the Executive may have under the Employment Agreement to receive any severance
payments under Section 8(a)(iii) thereof.

 

(c)   Until the first anniversary of
the Resignation Date, the Executive and his eligible spouse and dependents
shall continue to be eligible to receive the benefits that they would have
continued to receive under the Company’s medical, hospitalization, dental, and
life insurance plans, practices and programs, if the Executive had remained
employed by the Company, at the level in effect and upon substantially the same
terms and conditions (including without limitation contributions required to be
made by the Executive for such benefits, and subject to the Executive’s making
such contributions) as are in effect from time to time for active Company
employees; provided, that if and to the extent that the Executive, his
eligible spouse and his eligible dependents cannot continue to participate in
the Company programs providing such benefits, the Company shall arrange to
provide them with the economic equivalent of such benefits that they would
otherwise be entitled to receive; and provided  further, that the
foregoing benefits shall terminate if and to the extent that the Executive
becomes eligible to receive substantially equivalent benefits under the plans
and programs of any subsequent employer (determined on a benefit-by-benefit
basis).  Medical and dental benefits
under this subparagraph may be provided by the Company’s payment of a portion
of the Executive’s premiums for continued health coverage under Section 4980B
of Internal Revenue Code of 1986, as amended, and in any event the “qualifying
event” that gives rise to the right of the Executive and his eligible spouse
and eligible dependents to such continued health coverage shall be deemed to
occur on the Resignation Date.

 

(d)   All options to purchase shares
of common stock of the Company granted to the Executive prior to the
Resignation Date shall be and become fully vested and exercisable on the

 

2

 

Effective Date and shall continue to be outstanding
and exercisable and the expiration of such options shall be extended to the
first anniversary of the Resignation Date.

 

(e)   The Executive shall be entitled
to any other rights, compensation and/or benefits as may be due to the Executive
in accordance with the terms of the Company’s 401(k) plan.

 

(f)    Within seven (7) days
following the Executive’s execution of this Agreement, the Executive shall
submit expense reports documenting all business-related expenses which have
already been incurred for which the Executive seeks reimbursement that the
Company has not yet paid, and thereafter will submit such expenses within seven
(7) days of the date in which they are incurred.  The Company will review the expense reports and, subject to proper
documentation and verification that the expenses were business-related,
reimburse the Executive in accordance with Company policy.  No other expenses incurred by the Executive
prior to the Resignation Date will be reimbursed.

 

4.     Disparaging Comments

 

From and after the date
of this Agreement, except as may be required by a court or governmental body,
each of the Executive and the Company shall, and the Company shall cause each
of its subsidiaries and affiliates, and use its reasonable efforts to cause its
directors, officers and employees, to, refrain from taking actions or making
statements, written or oral, which disparage or defame the goodwill or
reputation of, the Price Legacy Entities and their trustees, officers, agents
and former and current employees and directors, or the Executive, respectively,
or which are intended to, or may be reasonably expected to, adversely affect
the morale of the employees of any of the Price Legacy Entities and their
trustees, officers, agents and former and current employees and directors, or
the Executive, respectively.  The
Executive further agrees not to make any negative statements, written or oral,
to third parties relating to his employment or any aspect of the business of
the Price Legacy Entities and not to make any statements, written or oral, to
third parties about the circumstances of his resignation, except as may be
required by a court or governmental body, or as may merely repeat any of the
matters contained in the press release of the Company issued on or about the
date hereof.

 

5.     Confidentiality of this
Agreement

 

Except as required by law
or regulation or as otherwise agreed to by the Parties, none of the Parties
hereto will disclose the terms of this Agreement, provided that the
Executive may disclose such terms to his financial and legal advisors and his
spouse and the Company may disclose such terms to selected employees, advisors
and affiliates on a “need to know” basis, each of whom shall be instructed by
the Executive and the Company, as the case may be, to maintain the terms of
this Agreement in strict confidence in accordance with the terms hereof.

 

6.     Additional
Covenants

 

The Company hereby agrees
that the restrictions contained in the Employment Agreement on the Executive’s
ability either to engage in any activities directly or indirectly, in
competition with the Company or to make any investment in competition with the
Company are eliminated as of the Effective Date, and the Company shall execute
all document necessary or reasonably requested by the Executive to reflect such
elimination of restrictions.

 

3

 

7.     Waiver of Other Payments
and Benefits

 

The compensation and
benefits arrangements set forth in this Agreement are in lieu of any rights or
claims that the Executive may have with respect to severance or other vested
benefits, or any other form of remuneration from the Price Legacy Entities,
other than benefits under any tax-qualified employee pension benefit plans
subject to the Employee Retirement Income Security Act of 1974, as amended
(including the Company’s 401(k) plan), and without limiting the generality of
the foregoing, the Executive hereby expressly waives any right or claim that he
may have or could assert to payment for salary, bonuses, medical, dental or
hospitalization benefits, payments under supplemental retirement plans and
incentive plans, life insurance benefits and attorneys’ fees, except as
otherwise provided in this Agreement or as mandated under applicable law.

 

8.     Information
Requests/Cooperation

 

The Executive agrees to
make himself, and agrees to use reasonable efforts to cause representatives of
any joint venture partners with which the Company has a business relationship
prior to the date hereof to be, reasonably available to the Company for a
two-year period from the Resignation Date to respond to requests by the Company
for information concerning matters involving facts or events relating to the
Company or any other Price Legacy Entity that may be within the Executive’s
knowledge, and to assist the Company and the Price Legacy Entities as
reasonably requested with respect to pending and future litigations,
arbitrations or other dispute resolutions; provided, that, to the extent
the Executive can reasonably comply with the foregoing requirements, he shall
be entitled to do so via telephone.  The
Company will reimburse the Executive for his reasonable travel expenses and
out-of-pocket costs incurred as a result of his assistance under this Section
8.

 

9.     No Admission of Wrongdoing

 

Nothing contained in this
Agreement shall be construed in any way as an admission by any of the Parties
of any act, practice or policy of discrimination or breach of contract either
in violation of applicable law or otherwise.

 

10.  Waiver and Release by the
Executive

 

(a)   In consideration of the
payments and benefits set forth in this Agreement, except for the payment and
benefits expressly provided herein, the Executive, for himself, his heirs,
administrators, representatives, executors, successors and assigns
(collectively “Releasors”) does hereby irrevocably and unconditionally
release, acquit and forever discharge the Price Legacy Entities and their
trustees, officers, affiliates, agents, and former and current employees and
directors, and their successors, executors and assigns, including without
limitation all persons acting by, through, under or in concert with any of them
(collectively, “Releasees”), from any and all charges, complaints,
claims, liabilities, obligations, promises, agreements, controversies, damages,
remedies, actions, causes of action, suits, rights, demands, costs, losses,
debts and expenses (including attorneys’ fees and costs) (collectively, “Claims”)
of any nature whatsoever, known or unknown, whether in law or equity and
whether arising under federal, state or local law, which the Releasors had, now
have, or may have in the future as a result of any facts or

 

4

 

circumstances currently existing or which may have
existed in the past (including, without limitation, any and all matters arising
from the Executive’s employment by or service with the Company), but excluding
any Claims arising from any action to enforce the Company’s obligations under
this Agreement, the Master Separation Agreement or any other agreement or
instrument entered into and delivered under this Agreement or the Master
Separation Agreement, against each or any of the Releasees (collectively, the “Released
Claims”).  The Executive
acknowledges and agrees that if he or any other Releasor should hereafter make
any claim or demand or commence or threaten to commence any action, claim or
proceeding against the Releasees with respect to any cause, matter or thing
which is the subject of this Section 10(a), this Agreement may be raised as a
complete bar to any such action, claim or proceeding, and the applicable
Releasee may recover from the Executive all costs incurred in connection with
such action, claim or proceeding, including attorneys’ fees.

 

(b)   With respect to any and all
Released Claims, the Executive stipulates and agrees that, upon execution of
this Agreement, Releasors shall be deemed to have expressly waived and
relinquished, to the fullest extent permitted by law, the provisions, rights,
and benefits of Section 1542 of the California Civil Code, which provides:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.

 

The Releasors, upon
execution of this Agreement, shall be deemed to have waived any and all
provisions, rights and benefits conferred by any law of any state or territory
of the United States, or principle of common law, which is similar, comparable
or equivalent to Section 1542 of the California Civil Code.  The Releasors may hereafter discover facts
in addition to or different from those which he, she or it now knows or believes
to be true with respect to the subject matter of the Released Claims, but each
Releasor, upon the execution of this Agreement by the Executive, shall be
deemed to have fully, finally, and forever settled and released any and all
Released Claims, known or unknown, suspected or unsuspected, contingent or
noncontingent, whether or not concealed or hidden, which now exist, or
heretofore have existed upon any theory of law or equity now existing or coming
into existence in the future, including, but not limited to, conduct which is
negligent, intentional, with or without malice, or a breach of any duty, law or
rule, without regard to the subsequent discovery or existence of such different
or additional facts.

 

(c)   The Executive affirms that he
has been represented by counsel in connection with the negotiation and
execution of this Agreement and the waiver and release in Section 10(a).

 

(d)   THE EXECUTIVE ACKNOWLEDGES AND
UNDERSTANDS THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN
CLAIMS.

 

11.  Older Workers Benefit
Protection Act

 

In accordance with the
Older Workers Benefit Protection Act of 1990, the Executive acknowledges that:

 

5

 

(a)   This Agreement includes a
waiver and release of the Executive’s claims under the Age Discrimination in
Employment Act, 29 U.S.C. § 621 et seq.

 

(b)   The Executive has the right to
consult with an attorney before signing this Agreement.

 

(c)   The Executive has twenty-one
(21) days to consider this Agreement but he may waive that period by signing it
earlier.

 

(d)   The Executive has seven (7)
days after signing this Agreement to revoke this Agreement and this Agreement
will not be effective until that revocation period has expired.  Notice of revocation must be delivered by fax
or e-mail to the Chairman of the Board of Directors of the Company.

 

12.  Waiver and Release by the
Company

 

(a)   In consideration of the matters
set forth in this Agreement, except for the payment and benefits expressly
provided herein, the Price Legacy Entities, for themselves and their successors
and assigns (collectively “Price Legacy Releasors”) does hereby
irrevocably and unconditionally release, acquit and forever discharge the
Executive and his successors, executors and assigns, including without
limitation all persons acting by, through, under or in concert with any of them
(collectively, “Price Legacy Releasees”), from any and all Claims of any
nature whatsoever, known or unknown, whether in law or equity and whether
arising under federal, state or local law which the Price Legacy Releasors had,
now have, or may have in the future as a result of any facts or circumstances
currently existing or which may have existed in the past (including, without
limitation, any and all matters arising from the Executive’s employment by or
service with the Company), against each or any of the Price Legacy Releasees
(collectively, the “Price Legacy Released Claims”); provided that
the Price Legacy Released Claims shall not include either (x) any Claims
arising from any action to enforce the Executive’s obligations under this
Agreement, the Master Separation Agreement or any other agreement or instrument
entered into and delivered under this Agreement or the Master Separation
Agreement or (y) any Claims as to which indemnification of a director or officer
of the Company would be unavailable under Maryland law.  The Company acknowledges and agrees that if
it or any other Price Legacy Releasor should hereafter make any claim or demand
or commence or threaten to commence any action, claim or proceeding against the
Price Legacy Releasees with respect to any cause, matter or thing which is the
subject of this Section 12(a), this Agreement may be raised as a complete bar
to any such action, claim or proceeding, and the applicable Price Legacy
Releasee may recover from the Company all costs incurred in connection with
such action, claim or proceeding, including attorneys’ fees.  In
addition, to the extent the Company’s consent is required under the formation
or organizational documents of partnerships and/or joint ventures to which the
Company is a party, the Company agrees not to consent to the assertion of any
Claims against Executive by such partnerships or joint ventures, subject to the
exceptions contained in the first sentence of this Section 12.

 

(b)   With respect to any and all
Price Legacy Released Claims, the Company stipulates and agrees that, upon
execution of this Agreement, the Price Legacy Releasors shall be deemed

 

6

 

to have expressly waived and relinquished, to the
fullest extent permitted by law, the provisions, rights, and benefits of
Section 1542 of the California Civil Code, which provides:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.

 

The Price Legacy
Releasors, upon execution of this Agreement, shall be deemed to have waived any
and all provisions, rights and benefits conferred by any law of any state or
territory of the United States, or principle of common law, which is similar,
comparable or equivalent to Section 1542 of the California Civil Code.  The Price Legacy Releasors may hereafter
discover facts in addition to or different from those which he, she or it now
knows or believes to be true with respect to the subject matter of the Price
Legacy Released Claims, but each Price Legacy Releasor, upon the execution of
this Agreement by the Company, shall be deemed to have fully, finally, and
forever settled and released any and all Price Legacy Released Claims, known or
unknown, suspected or unsuspected, contingent or noncontingent, whether or not
concealed or hidden, which now exist, or heretofore have existed upon any
theory of law or equity now existing or coming into existence in the future,
including, but not limited to, conduct which is negligent, intentional, with or
without malice, or a breach of any duty, law or rule, without regard to the
subsequent discovery or existence of such different or additional facts.

 

13.  Confidential Information

 

The Executive understands
and acknowledges that during the course of his employment by the Price Legacy
Entities, he has had access to and has become acquainted with trade secrets and
other confidential information of the Price Legacy Entities (which shall
include, but not be limited to, financial information, business plans,
marketing plans and proposals, compilations of information, business and
employee records, publication information and vendor information, but shall not
include contact information for business relationships developed by the
Executive during his employment with the Price Legacy Entities and standard
form agreements regularly used in the operation of the business of the Price
Legacy Entities) which are owned by the Price Legacy Entities and which are
regularly used in the operation of the business of the Price Legacy
Entities.  The Executive further
understands and acknowledges that despite termination of his employment with
the Price Legacy Entities, he has a continuing legal obligation not to
disclose, and not to use, directly or indirectly, any such trade secrets or
confidential information owned by the Price Legacy Entities.

 

14.  Public Statement

 

The Parties agree that
the Executive’s resignation of his employment was announced by the Company on
September 22, 2003, and that no subsequent comments shall be made to the media
or through other public statements by any Party hereto regarding the Executive’s
resignation of his employment that are inconsistent with such statement, except
as may be required by applicable law or regulation.

 

7

 

15.  No Reliance

 

The Executive represents
and acknowledges that, in executing this Agreement, he has not relied upon any
representation or statement made by the Company not set forth herein.

 

16.  Return of Company Property

 

Except as previously
agreed between the Parties, on the Effective Date, the Executive shall return
in good working order any equipment or other property belonging to the Company.

 

17.  Governing Law

 

(a)   This Agreement shall be
governed by and construed in accordance with the laws of the State of
California, without regard to the principles of conflicts of law thereof, to
the extent not superseded by applicable federal law.  It is the intention of the Parties that any dispute or litigation
arising out of the negotiation, existence, performance, interpretation or
enforcement of this Agreement shall be determined only by the Courts of the
State of California (including the federal courts located in the State of
California), and no other court or tribunal. 
THE PARTIES HERETO HEREBY AGREE THAT ANY DISPUTE CONCERNING FORMATION,
MEANING, APPLICABILITY, ENFORCEMENT OR INTERPRETATION OF THIS AGREEMENT SHALL
BE SUBMITTED TO THE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA
(INCLUDING FEDERAL COURTS IN THE STATE OF CALIFORNIA), AND NO OTHER STATE SHALL
HAVE JURISDICTION OVER SUCH MATTERS, AND FURTHER AGREE TO WAIVE ALL RIGHTS TO A
JURY TRIAL WITH RESPECT TO ANY SUCH MATTERS. 
WITH RESPECT TO ANY SUCH DISPUTE, ALL PARTIES HERETO AGREE TO WAIVE ANY
DEFENSES OR OBJECTIONS THEY MAY HAVE TO THE PERSONAL JURISDICTION OVER THEM OF
THE AFORESAID CALIFORNIA COURTS, AND THE EXECUTIVE AGREES THAT SERVICE OF
PROCESS UPON HIM BY MAIL AT THE ADDRESS CONTAINED HEREIN SHALL BE GOOD AND
SUFFICIENT PERSONAL SERVICE, AND THAT SUCH SERVICE SHALL BE DEEMED TO HAVE BEEN
MADE UPON HIM AS IF HE WERE PERSONALLY SERVED AT A LOCATION WITHIN THE STATE OF
CALIFORNIA.

 

(b)   If either Party
brings an action to enforce its rights under this Agreement, the prevailing
Party in the action, at such time as the action is binding, final and no longer
appealable, shall be entitled to recover its costs and expenses, including,
without limitation, reasonable attorneys’ fees, incurred in connection with
such action, including any appeal of such action.

 

18.  Warranty

 

The Parties hereto
represent and warrant that there exists no impediment or restraint, contractual
or otherwise on their power, right or ability to enter into this Agreement and
to perform their duties and obligations hereunder or as contemplated hereby.

 

8

 

19.  Taxes

 

All payments made and
benefits provided to the Executive under this Agreement shall be reduced by, or
the Executive will otherwise pay, all required withholding, employment and
Medicare taxes applicable to the Executive.

 

20.  No Coercion

 

The Parties hereto
represent and acknowledge that they have decided to enter into this Agreement
voluntarily, knowingly and without coercion of any kind.

 

21.  Enforceability; Severability

 

The Parties hereto
affirmatively acknowledge that this Agreement, and each of its provisions, is
enforceable, and expressly agree not to challenge nor raise any defense against
the enforceability of this Agreement or any of its provisions in the
future.  In the event that any provision
or portion of this Agreement shall be determined to be invalid or unenforceable
for any reason, the remaining provisions or portions of this Agreement shall be
unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.

 

22.  Notices

 

All notices, requests,
demands and other communication which are required or may be given under this
Agreement shall be in writing and shall be deemed to have been duly given when
received if personally delivered; when transmitted by telecopy, electronic or
digital transmission method upon receipt of telephonic or electronic
confirmation; the day after it is sent, if sent for next day delivery to a
domestic address by recognized overnight delivery service (e.g., Federal
Express) and upon receipt, if sent by certified or registered mail, return
receipt requested.  In each case notice
shall be sent to:

 

If to the Executive,
addressed to:

 

S. Eric Ottesen

17140 Bernardo Height Drive, Suite 310

San Diego, California 92128

Fax: (858) 487-9890

 

If to the Company,
addressed to:

 

Price Legacy Corporation

17140 Bernardo Height Drive, Suite 300

San Diego, California 92128

Attention:  Chief Executive Officer

Fax: (858) 675-9405

 

or to such other place
and with such other copies as any Party may designate as to itself or himself
by written notice to the others.

 

9

 

23.  Amendments; Waivers

 

This Agreement may not be
amended, modified or terminated, except by a written instrument signed by the
Parties hereto.  Any provision of this
Agreement may be waived by a written instrument signed by the Party to be
charged with such waiver. No waiver by any Party hereto at any time of any
breach of, or compliance with, any condition or provision of this Agreement to
be performed by any other Party hereto shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.

 

24.  Successors

 

This Agreement shall be
binding on the Executive, the Company and their respective heirs, successors
and assigns, including without limitation any corporation or other entity into
which the Company may be merged, reorganized or liquidated, or by which the
Company may be acquired.  The
obligations of the Company may be assigned without limitation, provided
that the Company shall remain liable for the payment obligations under Section
2; but, as the obligations to be performed by the Executive hereunder are
unique based upon his skills and qualifications, the Executive’s obligations
under this Agreement may not be assigned.

 

25.  Entire Agreement

 

Except as specified
herein, this Agreement contains the entire agreement between the Parties
concerning the subject matter hereof and supersedes all prior agreement,
understandings, discussions, negotiations and undertakings, whether written or
oral, between the Parties with respect thereto.

 

26.  Counterparts

 

This Agreement may be
executed in several counterparts, each of which shall be deemed to be an
original, but all of which together will constitute one and the same Agreement.

 

10

 

IN WITNESS WHEREOF, the
Parties have executed this Agreement, as of the date and year first written
above.

 

	
   

  	
  PRICE LEGACY
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jack McGrory

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Jack McGrory

  
	
   

  	
   

  	
  Title:

  	
  CEO

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ S. Eric
  Ottesen

  	
   

  
	
   

  	
   

  	
  S. Eric Ottesen

  
						

 

11

 

Schedule
1

 

OFFICER RESIGNATION ENTITIES

 

	
  Entity

  	
   

  	
  Position

  
	
   

  	
   

  	
   

  
	
  Anaheim GardenWalk, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  William J. Stone, Manager

  S. Eric Ottesen, Manager

  
	
   

  	
   

  	
   

  
	
  Campers Villages,  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Destination Villages,
  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Destination Villages
  Daniel’s Head, Bermuda Ltd.

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Destination Villages
  Kauai, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  EPA Properties, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Graham R. Bullick, Manager

  
	
   

  	
   

  	
   

  
	
  Excel Legacy Corporation

  	
   

  	
  Richard B. Muir, President & CEO

  S. Eric Ottesen, SVP and Asst. Secretary

  
	
   

  	
   

  	
   

  
	
  Excel Legacy Holdings, Inc.

  	
   

  	
  Richard B. Muir, President & CEO

  S. Eric Ottesen, SVP and Asst. Secretary

  
	
   

  	
   

  	
   

  
	
  FAEX – HP, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  
	
   

  	
   

  	
   

  
	
  FAEX – SC, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  
	
   

  	
   

  	
   

  
	
  Grand Tusayan, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  LSGW Invesments, LLC

  	
   

  	
  Richard B. Muir,
  Manager

  
	
   

  	
   

  	
   

  
	
  Millennia Car Wash, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Newport on the Levee,
  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  Graham R. Bullick, Manager

  
	
   

  	
   

  	
   

  
	
  Old Mill District
  Shops, LLC

  	
   

  	
  William J. Stone,
  Manager

  
	
   

  	
   

  	
   

  
	
  Orlando Business Park,
  LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Orlando Business Park
  CD, Inc.

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  

 

12

 

	
  Entity

  	
   

  	
  Position

  
	
   

  	
   

  	
   

  
	
  PL - Mesa,  Inc

  	
   

  	
  Graham R. Bullick,
  Pres., CEO & Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PL - Groves,  Inc.

  	
   

  	
  Graham R. Bullick,
  Pres., CEO & Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Cross County, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Cypress Creek, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Dulles, Inc.

  	
   

  	
  Richard B. Muir, Pres.

  Graham R. Bullick, Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Kendale, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres.and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Millenia, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC OBC, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PLC Oakwood Plaza, Inc.

  	
   

  	
  Graham R. Bullick,
  Pres. and Director

  S. Eric Ottesen, Secretary and Director

  
	
   

  	
   

  	
   

  
	
  PRICE LEGACY CORPORATION

  	
   

  	
  Gary B. Sabin, CEO & Director

  Richard B. Muir, Vice Chairman

  Graham R. Bullick, SVP

  S. Eric Ottesen, SVP

  William J. Stone, SVP

  
	
   

  	
   

  	
   

  
	
  Price Owner Corp.

  	
   

  	
  Richard B. Muir, Pres.
  & CEO

  S. Eric Ottesen, SVP & Secretary

  
	
   

  	
   

  	
   

  
	
  Price Owner LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Price Self Storage,
  Inc.

  	
   

  	
  Gary B. Sabin, Pres.,
  CEO & Director

  Richard B. Muir, EVP, Secretary & Director

  S. Eric Ottesen, SVP

  
	
   

  	
   

  	
   

  
	
  TenantFirst Real Estate

  	
   

  	
  Richard B. Muir,
  President

  S. Eric Ottesen, SVP

  
	
   

  	
   

  	
   

  
	
  Yosemite Village, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  
	
   

  	
   

  	
   

  
	
  Anaheim GardenWalk, LLC

  	
   

  	
  S. Eric Ottesen,
  Manager

  Richard B. Muir, Manager

  William J. Stone, Manager

  

 

13

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