Document:

Agreement dated March 3, 2008

 WCI Towers Northeast USA Inc. 
  

					
	 v.
	  	Settlement Agreement
			
	 State of NJ Department of Community Affairs
	  		  	
	Division of Codes and Standards	  	Project:	  	The Watermark
	Bureau of Homeowners Protection	  		  	Condominium Residences                            
	PRED Compliance	  		  	R# 3891
	PO Box 805	  		  	
	Trenton, New Jersey 08625	  		  	

					
			
	To:	  	Mitchell Berkey, Esq.	 	WCI Towers Northeast USA Inc.
		  	Wolff & Samson PC	 	115 Stevens Ave.
		  	The Office at Crystal Lake	 	Valhalla, NY 10595
		  	One Boland Drive	 	
		  	West Orange, NJ 07052	 	

 Dated: March 3, 2008 
  

	 	1.	The above-referenced community, the Watermark Condominium Residences, was registered by WCI Towers Northeast USA Inc., hereinafter the developer, on June 15, 2005, and given R#
3891. A copy of the Order of Registration is attached hereto. 

  

	 	2.	The contract of purchase (the contract), included as Tab 13 of the Application for Registration and as Exhibit 3 of the Public Offering Statement, provided an estimated delivery
date of May 2007. 

  

	 	3.	On or about December 21, 2007 the Bureau received a complaint letter from the attorney for contract purchasers of two units in the development, alleging that the contract purchasers
were entitled to termination of their contracts and return of their deposits pursuant to the contract. 

  

	 	4.	The contract states that the estimated delivery date is only an estimate and that the date on which the title is ultimately set to close is called the scheduled closing date.

  

	 	5.	A developer must, pursuant to N.I.A.C. 5:26-6.5(a) 9, set a time limit on the permissible delay after which the purchaser may terminate the contract without penalty.

  

	 	6.	Developer has advised the Agency that a final inspection of the building took place on February 26, 2008. Developer has provided the Agency with a schedule of closing dates. As of
the date of execution of this Agreement by the developer, no closings have occurred. 

  

	 	7.	Moreover, on December 5, 2007, developer sent a letter to all contract purchasers stating that the “estimated delivery date for the building” was later that month and that
closings would commence thereafter. It is the Agency’s position that this was an attempt to change the contract without the requisite amendment to the contract. 

  

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 WCI Towers Northeast USA Inc., and DCA/BHP Settlement Agreement 
  

	 	8.	Settlement discussions were held prior to the issuance of any formal Notice of Violation and Order to Pay Penalty. 

  

	 	9.	The developer agrees to pay an administrative penalty of $130,000. 

  

	 	10.	A certified, bank or attorney trust account check in the amount of $130,000, payable to Treasurer, State of New Jersey, must be received by the Agency no later than March 14, 2008.

  

	 	11.	The developer further agrees to submit an amended contract for use with future purchasers that permits a purchaser to terminate the contract and receive a refund of the deposit,
provided that purchaser is not in default of its obligations under the contract, if the developer is not ready, willing and able to close within 180 days from the anticipated delivery date set forth in the contract, and eliminating any reference to
a scheduled closing date. 

  

	 	12.	Until a satisfactory amendment is registered by the Agency, the developer agrees to cease and desist from offering any additional contracts. 

  

	 	13.	Developer further agrees to submit an affidavit 1) stating that it will not offer any additional contracts until the amendment described in paragraph 11 above is registered and 2)
attesting to the fact that the contract purchasers described in Paragraph 14 below have requested cancellation of their contracts and the return of all their deposit monies. 

  

	 	14.	Attached to the affidavit shall be 1) the list of all contract purchasers identified by unit number and 2) a list of all contact purchasers identified by unit number, who, as of
February 29, 2008, have requested in writing cancellation of their contracts and the return of all their deposit monies because of the passage of the 180 days time period, and who have not as of February 29, 2008, reached a resolution with developer
either by closing on their unit or agreeing to close on their unit; the list shall include the date of the request for cancellation. 

  

	 	15.	The affidavit and attached list must be received by the Agency no later than February 29, 2008. 

  

	 	16.	Developer further agrees to send a letter to all contract purchasers stating that if the developer fails to be ready, willing and able to close title to any of the units by May 26,
2008, through no fault of the contract purchaser, the developer will offer the contract purchaser a right of rescission of its contract and to receive a full refund of all deposits. All other terms of the contract shall remain in full force and
effect and shall not be modified by the terms of this Settlement Agreement. 

  

	 	17.	In any event, all those contract purchasers described under clause 2 of paragraph 14 above, who have not otherwise reached a resolution with developer, either by closing on their
unit or agreeing to close on their unit, shall be entitled to rescission and return of their deposits by no later than 30 days after the May 26, 2008 date. 

  

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 WCI Towers Northeast USA Inc., and DCA/BHP Settlement Agreement 
  

	 	18.	A draft of the letter described in paragraph 16 above must be submitted to the Agency no later than March 14, 2008. 

  

	 	19.	If the penalty payment check, the affidavit, and the draft of the May 26, 2008 delivery date letter are not received as set forth in paragraphs 10, 15 and 18 above, the Bureau of
Homeowner Protection shall issue a Notice of Violation and Order to Pay Penalty and Order to Cease and Desist. 

  

	 	20.	If for any reason WCI Towers Northeast USA Inc., or any officer, director, or principal of WCI Towers Northeast USA Inc. fails to comply with the terms of this Agreement, the Bureau
of Homeowner Protection may, pursuant to regulation, invoke a suspension, revocation, or denial action against any of the principals, directors, or partners of WCI Towers Northeast USA Inc., who are registered new homebuilders in the State of
New Jersey or who apply to become new homebuilders in New Jersey. 

  

	 	21.	WCI Towers Northeast USA Inc. by entering into this Settlement Agreement waives its rights to any hearing as to the claims raised herein and waives all rights to appeal any and all
matters directly or indirectly related to this Settlement Agreement. The foregoing shall not be construed as a waiver of any rights as to the enforcement of the terms of this Agreement. Notwithstanding anything in this Paragraph 21 WCI Towers
Northeast USA Inc. does not waive its rights to a hearing/appeal on any new future actions brought by the Department of Community Affairs and/or the Bureau of Homeowner Protection. 

  

	 	22.	By entering into this Settlement Agreement, the Bureau of Homeowner Protection, Planned Real Estate Development Section does not forfeit its right to take administrative action
against WCI Towers Northeast USA Inc., if for any reason WCI Towers Northeast USA Inc. or any officer, director, or principal of WCI Towers Northeast USA Inc. fails to comply with the terms of this Agreement. 

  

	 	23.	By entering into this Agreement, the Bureau of Homeowner Protection, Planned Real Estate Development Section does not sanction the conduct of WCI Towers Northeast USA Inc. at issue
herein. 

  

	 	24.	This Settlement Agreement is binding upon the Bureau of Homeowner Protection, and WCI Towers Northeast USA Inc. and its principals, directors, officers, agents, heirs, assigns, any
trustee in bankruptcy and any receiver appointed in law or equity. 

  

	 	25.	Notice is hereby given that violations of any statutes, rules or permits may be cause for enforcement actions, either administrative or judicial, being instituted without further
notice. By entering into this Settlement Agreement, the Bureau of Homeowner Protection and the Department of Community Affairs do not waive the right to initiate enforcement actions if any violations occur in the future and WCI Towers Northeast USA
Inc. does not waive its rights to fully contest same. 

  

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 WCI Towers Northeast USA Inc., and DCA/BHP Settlement Agreement 
  

	 	26.	No obligations imposed by this Settlement Agreement are intended to constitute a debt, damage, claim, penalty or civil action, which should be limited or discharged in a bankruptcy
proceeding. All obligations imposed by this agreement shall constitute regulatory obligations pursuant to the PRED Act and Regulations. 

  

	 	27.	If any provision of this Settlement Agreement is declared by any Court of competent jurisdiction to be illegal or invalid, the validity of the remaining parts shall not be affected
thereby, so long as the essential purposes of this Agreement are not affected thereby, and the illegal or invalid portion shall be deemed stricken from this Settlement Agreement. 

  

	 	28.	This Settlement Agreement shall not be modified or amended except in a writing signed by all the Parties to this Settlement Agreement and only to the extent that such modification
or amendment does not conflict with paragraph 27 above. 

  

	 	29.	This Settlement Agreement shall be governed by and interpreted and construed in accordance with the statutes and regulations of the State of New Jersey. 

  

	 	30.	Each Party represents and warrants that this Settlement Agreement is fair and valid and that it executes this Settlement Agreement with full knowledge of its provisions and under no
compulsion or duress. 

  

	 	31.	The Parties to this Settlement Agreement acknowledge that each of them has been represented throughout all of the negotiations which preceded the execution of this Settlement
Agreement and in connection with the preparation and execution of this Settlement Agreement. 

  

	 	32.	The Parties represent and warrant that the persons executing this Settlement Agreement are authorized to do so on their behalf. 

  

	 	33.	Settlement will only be considered on the terms as stated herein. 

  

	 	34.	Except as expressly provided herein, all Notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered
by hand, or by fax or electronic mail, confirmation of receipt requested, or mailed, registered or certified mail, return receipt requested, postage prepaid, to the following representatives: 

  

	 	(a)	In the case of Notice to Petitioner: 

 Mitchell Beckey,
Esq. or Daniel Murphy, Esq. 
 Wolff & Samson PC 
 The Office at Crystal Lake 
 One Boland Drive 
 West Orange, NJ 07052 
 Email:mberkey@wolffsamson.com; dmurphy@wolffsamson.com 
  

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 WCI Towers Northeast USA Inc., and DCA/BHP Settlement Agreement 
  

	 	(b)	In the case of Notice to Respondent: 

 Bornice J. Rosenthal, Compliance Officer – PRED 
 Bureau of Homeowner Protection 
 P.O. Box 805 
 Trenton, New Jersey 08625-0805 
 PHONE #: 609-984-7574 
 FAX #: 609-292-2839 
 Email: brosenthal@dca.state.nj.us 
 Or 
 Steven Denenboltz, Supervisor, Compliance 
 Bureau of Homeowner Protection 
 P.O. Box 805 
 Trenton, New Jersey 08625-0805 
 PHONE #: 609-984-7574 
 FAX #: 609-292-2839 
 Email: sdenenholtz@dca.state.nj.us 
 This agreement must be executed and returned to the Bureau of Homeowner Protection, Planned Real Estate Development Section no later than end of business February 29, 2008, or the terms of this settlement will be considered null and void.

  

									
	By:	 	 

	 		 	Date:	 	2/29/08

  

	For:	WCI Towers Northeast USA Inc. 

  

											
	By:	 	 

	 		 		 	Date:	 	3/3/08
		 	Peter Desch, Chief	 		 		 		 	

  

	For:	Bureau of Homeowner Protection 

 New Jersey Department of
Community Affairs 
 Bureau of Homeowner Protection 
 PRED Compliance 
  

			
	Attachment:	 	Order of Registration dated June 15, 2005.

  

 Page 5 of 5 

 DEPARTMENT OF COMMUNITY AFFAIRS 
 PLANNED REAL ESTATE DEVELOPMENT 
 FULL DISCLOSURE ACT 
 N.J.S.A. 45:22A-21 et seq. 
 ORDER OF
REGISTRATION 
 WATERMARK CONDOMINIUM RESIDENCES 
 Registration Number: 03891 
 Pursuant to the authority of N.J.S.A. 45:22A-21 et seq. and the regulations promulgated
thereunder, the Division of Codes and Standards here by registers the above named development. 
 This registration shall not be construed as a
recommendation of the development nor as a determination of the truthfulness of the statements contained in the Application for Registration but only represents determination that the requirements of the Act have been met. 
 The applicant is under the obligation to notify the Agency of any material changes in the information contained in the Application for Registration and to file the
necessary annual reports pursuant to N.J.A.C. 5:26-2.13. 
  

					
	DATED: 06/15/2005	 	DIVISION OF CODES AND STANDARDS
		 	WILLIAM M. CONNOLLY, DIRECTOR
			
		 	by:	 	 

		 		 	Stewart P. Palilonis, Manager
		 		 	Planned Real Estate DevelopmentForm of Restricted Stock Agreement with Non-Employee Directors

 Exhibit 10.1 
 RESTRICTED STOCK AGREEMENT 
 This Agreement is made and entered into as of April 11, 2008 (the
“Grant Date”) by and between McCormick & Schmick’s Seafood Restaurants, Inc., a Delaware corporation (the “Company”) and
                     (“Independent Director”). 
 RECITALS 
 A. To attract and retain the services of selected employees and independent directors, the
Board of Directors of the Company (the “Board”) has adopted the 2004 Stock Incentive Plan (the “Incentive Plan”). 
 B.
Under the Incentive Plan, the Board of Directors may make restricted awards of the Company’s common stock subject to terms, conditions, and restrictions determined by the Board of Directors. 
 C. The Board of Directors considers it in the Company’s best interest to award Independent Director a restricted stock grant to enhance the
Company’s ability to retain Independent Director’s services on behalf of the Company. 
 D. Independent Director accepts the
restricted stock award on the terms and conditions contained in this Agreement and in the Incentive Plan. 
 AGREEMENT 
 1. Award of Restricted Stock. Pursuant to Section 8 of the Incentive Plan, the Board of Directors awards to Independent Director
                 shares of the Company’s fully paid and nonassessable Common Shares as a restricted stock grant (the “Restricted Stock”). All of
the Restricted Stock is subject to the length of service restrictions set forth in Section 2. 
 2. Length of Service
Restrictions. All of the Restricted Stock shall initially be subject to forfeiture to the Company. All of the Restricted Stock shall be automatically forfeited to the Company if Independent Director’s service to the Company terminates for
any reason prior to April 11, 2009. 
 Notwithstanding the foregoing, the possibility of forfeiture of the Restricted Stock established
above shall lapse in its entirety if Independent Director’s service terminates because of the death or total disability, as defined in the Incentive Plan, of the Independent Director. 
  

  
 2004 SIP Restricted Stock Agreement – Independent Director1 
  

 3. Certain Transactions. Notwithstanding any other provision in this Agreement, in the event of a
merger, consolidation, plan of exchange, acquisition of property, or stock, split-up, split-off, spin-off, reorganization or liquidation to which the Company is a party or any sale, lease, exchange or other transfer (in one transaction or a series
of related transactions) of all, or substantially all, of the assets of the Company (each, a “Transaction”), the Company shall, by action of the Board of Directors, in its sole discretion and to the extent possible under the structure of
the Transaction, select one of the following alternatives: 
 (i) The Restricted Stock shall remain outstanding and the terms
of this Agreement shall remain in effect in accordance with its terms. 
 (ii) The Restricted Stock, to the extent then still
subject to the length of service forfeiture restrictions, shall be forfeited to the Company at the closing of the Transaction. 
 (ii) The Restricted Stock shall be converted into restricted stock of one or more of the corporations that are the surviving or acquiring corporations in the Transaction. The amount and type of converted restricted stock shall be determined
by the Company, taking into account the relative values of the companies involved in the Transaction and the exchange rate, if any, used in determining shares of the surviving corporation(s) to be held by holders of shares of the Company following
the Transaction. Unless otherwise determined by the Company, by action of the Board of Directors, the converted restricted stock shall continue to be subject to the forfeiture provisions applicable to the Restricted Stock at the time of the
Transaction. 
 4. Share Issuance and Dividends; No Transfers. Restricted Stock shall be issued as soon as practicable after the
effective date of this Agreement in the name of the Independent Director and may be certificated or uncertificated. To facilitate the cancellation of Restricted Stock upon forfeiture, Independent Director shall execute a stock power upon request,
endorsed in blank, covering all Restricted Stock and deliver it to the Company. Certificates, if any, and corresponding stock powers shall be held by the Company or its designee until the possibility of forfeiture has lapsed. Upon the lapse of
forfeiture restrictions with respect to all or a portion of the Restricted Stock, certificates representing such shares shall be delivered to the registered owner as soon as practicable, subject to any applicable withholding. If forfeiture occurs,
the certificates covering the forfeited shares, if any, shall be promptly cancelled by the Company. While the shares of Restricted Stock are subject to forfeiture, Independent Director will be entitled to receive cash dividends declared on the
Restricted Stock, if any, and will be able to exercise voting and other shareholder rights. Shares for any stock dividends shall also be held in accordance with this Section. If forfeiture occurs, Independent Director shall have no right to receive
retained stock dividends with respect to Restricted Stock that is forfeited. No interest in any Restricted Stock may be transferred voluntarily or by operation of law until the possibility of forfeiture lapses. The registered owner to whom a
certificate is delivered pursuant to this Section shall be Independent Director, unless Independent Director is not living, in which case the owner shall be the person or persons establishing rights of ownership by will or under the laws of descent
and distribution. 
 5. Taxes. Independent Director is advised that any income recognized as a result of receiving the Restricted
Stock will be treated as ordinary compensation income subject to federal, state and local income, employment and other tax withholding. Independent Director is advised that if he or she makes an election under Section 83(b) of the Internal
Revenue Code of 1986 with respect to some or all of the Restricted Stock, Independent Director will recognize ordinary compensation income at the time of the Restricted Stock award in an amount equal to the fair market value of the Restricted Stock
on that date. If Independent Director does not make a Section 83(b) election, Independent Director will recognize ordinary compensation income (i) at the time or times any portion of the Restricted Stock 

  

  
 2004 SIP Restricted Stock Agreement – Independent Director2 
  

 
vests in accordance with Section 2 of this Agreement, in an amount equal to the fair market value of that Restricted Stock on the vesting date,
and (ii) in connection with the payment of any cash dividends on the Restricted Stock while the Restricted Stock is unvested. Prior to or concurrently with the acceptance by the Company of a Section 83(b) election for the Restricted Stock
or delivery to Independent Director of the certificates representing the Restricted Stock, Independent Director shall pay to Company the amount necessary to satisfy all applicable federal, state and local tax withholding requirements arising in
connection with Independent Director’s receipt of the Restricted Stock, including any amounts required to be withheld at the time any portion of the Restricted Stock vests in accordance with Section 2 of this Agreement. Independent
Director shall pay these amounts in cash or, at the election of the Independent Director, by surrendering to Company for cancellation (i) Restricted Stock (except in the case of withholding due in connection with a Section 83(b) election)
or (ii) other shares of Company Common Stock held for at least six months, in each case valued at the closing market price for the Company Common Stock on the last trading day preceding the date of Independent Director’s election to
surrender such shares. If additional withholding becomes required beyond any amount paid before delivery of the certificates representing the Restricted Stock, Independent Director shall pay such amount to Company upon demand. If shareholder fails
to pay any amount demanded, Company shall have the right to withhold such amount from other amounts payable by Company to the Independent Director, including salary, subject to applicable law. Independent Director is advised that to be valid a
Section 83(b) election must be filed with the Internal Revenue Service within 30 days of the date of the Restricted Stock award, a copy of the election must be provided to the Company, and a copy of the election must be attached to the
Independent Director’s federal (and possibly state) income tax return for the year of the election. Independent Director acknowledges that if he or she chooses to make a Section 83(b) election, it is Independent Director’s sole
responsibility, and not Company’s, to make a valid and timely election. Independent Director is encouraged to review the Federal Income Tax Consequences portion of the Company’s 2004 Stock Incentive Plan Prospectus and to consult
Independent Director’s personal tax advisor regarding the advisability of making a Section 83(b) election with respect to the Restricted Stock. 
 IRS Circular 230 notice: Any tax advice contained herein was not intended or written to be used, and cannot be used, by Independent Director or any other person (i) in promoting, marketing or recommending any transaction, plan or
arrangement or (ii) for the purpose of avoiding penalties that may be imposed under federal tax law. 
 6. Additional Common
Shares of the Company. If, during the period when any of the Restricted Stock is subject to forfeiture, the outstanding Common Shares are increased as a result of a stock dividend or stock split, the restrictions and other provisions of this
Agreement shall apply to any such additional shares which are issued in respect of any Restricted Stock to the same extent as such restrictions and other provisions apply to the Restricted Stock. 
 7. Restrictive Legend; Stop Transfer. Certificates for shares issued under this Agreement may bear the following legend: 

“The shares represented by this certificate are subject to a Restricted Stock Agreement between the registered owner and McCormick &
Schmick’s Seafood Restaurants, Inc. materially restricting the transferability of the shares. A copy of the agreement is on file with the Secretary of McCormick & Schmick’s Seafood Restaurants, Inc.” 
  

  
 2004 SIP Restricted Stock Agreement – Independent Director3 
  

 If shares of Restricted Stock are uncertificated, the Company may issue a stop transfer order with
respect to, or otherwise make adequate provision to restrict the transferability of, the Restricted Stock. 
 8. Electronic Delivery.
Independent Director consents to the electronic delivery of any prospectus and any other documents relating to this award in lieu of mailing or other form of delivery. 
  

			
	MCCORMICK & SCHMICK’S SEAFOOD RESTAURANTS,
INC.
		
	By:	 	 
		 	Emanuel N. Hilario, Chief Financial Officer

  

  
 2004 SIP Restricted Stock Agreement – Independent Director4 
  

 AGREEMENT AND STOCK ASSIGNMENT 
 FOR VALUE RECEIVED, the undersigned sells, assigns, and transfers to McCormick & Schmick’s Seafood Restaurants, Inc. (the
“Company”)                  shares of Common Stock (the “Shares”) of the Company standing in the name of the undersigned on the books of the
Company, which Shares are subject to a Restricted Stock Agreement dated April 11, 2008, and irrevocably constitutes and appoints Emanuel N. Hilario attorney to transfer the Shares on the books of the Company with full power of substitution.

 The undersigned hereby agrees to the terms of the Restricted Stock Agreement and agrees that the undersigned’s signature below
constitutes his signature to the Restricted Stock Agreement and that this Agreement and Stock Assignment may be affixed thereto. 
 Dated:
                         
  

			
	By:	 	 

  

  
 2004 SIP Restricted Stock Agreement – Independent Director5

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