Exhibit 10.1
EXECUTION COPY
SETTLEMENT AND SEPARATION AGREEMENT
SETTLEMENT AND SEPARATION AGREEMENT, dated this 27th day of August, 2004
(this "Agreement"), by and among John A. Williams, an individual resident of the
State of Georgia ("Williams"), and The John A. Williams Irrevocable Trust Dated
January 27, 1995 (the "Trust"), on the one hand, and Post Properties, Inc., a
Georgia corporation (the "Company"), Post GP Holdings, Inc., a Georgia
corporation ("Holdings"), Post Apartment Homes, L.P., a Georgia limited
partnership ("Post Apartment Homes") and Post Services, Inc., a Georgia
corporation ("Services"), on the other.
WHEREAS, certain disputes have arisen between Williams and the Company,
including disputes relating to various policies and the Company's management,
and disputes relating to certain payments which Williams believes are due to him
from the Company and certain payments which the Company believes are due to it
from Williams and his son, John A. Williams, Jr.;
WHEREAS, Williams and the Company are party to: (i) a Master Employment
Agreement dated March 25, 2002 (the "Employment Agreement") among Williams, the
Company, Holdings, as general partner of Post Apartment Homes, and Services; and
(ii) a Noncompetition Agreement dated as of July 22, 1993 among Williams, the
Company and Post Apartment Homes, as amended as of June 1, 1998 (the
"Noncompetition Agreement");
WHEREAS, Williams, the Company, and the other parties thereto desire to
terminate the Employment Agreement and the Noncompetition Agreement, and to
enter into this Agreement to settle and resolve all disputed matters between
them;
WHEREAS, Post Apartment Homes and the Trust desire to continue, as set
forth below, the Split Dollar Insurance Agreement between such parties dated
December 23, 1998, as amended on September 29, 1999 (the "Split Dollar
Agreement");
WHEREAS, the Company, Services and Holdings, each acting through its Board
of Directors, have determined that their interests and the interests of their
respective Affiliates and shareholders would best be served by resolving all
disputes with Williams on the terms set forth in this Agreement and receiving
the rights and benefits provided to it in this Agreement; and
WHEREAS, Holdings, as general partner of Post Apartment Homes, has
determined that the interests of the partners of Post Apartment Homes would best
be served by resolving all disputes with Williams on the terms set forth in this
Agreement.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
representations, warranties, covenants and agreements set forth herein, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound, the parties hereto hereby agree as follows:
1. Employment Agreement. Effective at 12:01 a.m., Atlanta, Georgia time,
on the date first set forth above (the "Effective Time"), the Employment
Agreement will be terminated and discharged and will be of no further force or
effect, and, subject to the following sentence, all rights, duties, obligations
and liabilities thereunder, including any provisions that otherwise would
expressly survive termination thereof, will be terminated and extinguished. Any
provisions of the Employment Agreement intended to remain in effect from and
after the Effective Time are expressly set forth in their entirety in this
Agreement.
2. Noncompetition Agreement; Trade Secrets; Confidential Information;
Nonsolicitation of Employees.
(a) Effective at the Effective Time, the Noncompetition Agreement will be
terminated and discharged and will be of no further force or effect, and all
rights, duties, obligations and liabilities thereunder, including any provisions
that otherwise would expressly survive termination thereof, will be terminated
and extinguished. Any provisions of the Noncompetition Agreement intended to
remain in effect from and after the Effective Time are expressly set forth in
their entirety in this Agreement.
(b) Williams agrees that he will continue to hold in a fiduciary capacity
the Company and its Affiliates, and shall not directly or
indirectly use or disclose, any Trade Secret that Williams may have acquired
prior to the Effective Time for so long as such information remains a Trade
Secret.
(c) In addition to and not in limitation of the provisions of paragraph
2(b) above, Williams agrees that for a period commencing at the Effective Time
and expiring on the second anniversary of the Effective Time, he will hold in a
fiduciary capacity for the benefit of the Company and its Affiliates, and shall
not directly or indirectly use or disclose, any "Confidential or Proprietary
Information" (as such term is hereinafter defined) that Williams may have
acquired (whether or not developed or compiled by Williams and whether or not
Williams was authorized to have access to such Confidential or Proprietary
Information) during the term of, in the course of, or as a result of his
employment by the Company or any of its Affiliates, at any time prior to the
Effective Time. Williams shall be entitled to assume that any Person, other than
Williams or his employees, who has made such information publicly available had
the right to do so, unless Williams knows that such is not the case.
(d) Williams will not, during the period commencing at the Effective Time
and expiring on the second anniversary of the Effective Time, seek to employ on
his own behalf or on behalf of any other Person which engages, directly or
indirectly, in the development, operation, management, leasing, or landscaping
of a "Multifamily Property" (as such term is hereinafter defined), any person
who was employed as an employee of the Company or any of its Affiliates in an
executive, managerial or supervisory capacity at any time prior to the Effective
Time by the Company or any of its Affiliates and who has not thereafter ceased
to be employed by the Company or any of its Affiliates for a period of at least
one (1) year.
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3. Lump Sum Payment. Upon execution of this Agreement, in full and final
satisfaction, settlement and discharge of any and all amounts (whether disputed
or undisputed) that (i) the Company believes are owed to it, or any of its
Affiliates or Associates which are not natural persons, by Williams and John A.
Williams, Jr., and (ii) Williams believes are owed to him by the Company and any
of its Affiliates or Associates which are not natural persons, the Company will
pay to Williams by wire transfer of immediately available funds to an account
specified in writing by Williams, a lump sum amount of $150,000.
4. Payments and Benefits to Williams. Upon execution of this Agreement,
the Company shall pay to Williams the sum of $135,000, by wire transfer of
immediately available funds to an account specified in writing by Williams, in
full and final satisfaction, settlement and discharge of any and all payments,
perquisites, benefits and services to which Williams is entitled under the
Employment Agreement as of the Effective Time. Commencing at the Effective Time,
in lieu of all payments, perquisites, benefits and services paid to or provided
by the Company to Williams pursuant to the Employment Agreement, the Company
shall make the following payments and provide the following benefits to
Williams:
(a) Commencing at the Effective Time and continuing until the first to
occur of May 31, 2013 or Williams' death, the Company will pay to Williams an
annual amount of $400,000, payable in accordance with the Company's payroll
procedures then in effect with respect to its executive officers; provided,
however, in the event Williams dies prior to May 31, 2013, there shall be an
additional lump sum payment equal to $150,000. The severance payments described
herein are made in consideration for the relinquishment of Williams' rights
under the Employment Agreement and, accordingly, pursuant to Rev. Ruling 58-301,
the severance payments are not subject to tax withholdings.
(b) Commencing at the Effective Time and continuing until the first to
occur of May 31, 2013 or Williams' death, the Company shall continue to make
available to Williams for his personal use, under the existing agreement between
the Company and NetJets Inc. (Contract No. 1012158), a Falcon 2000 for 100 hours
in each consecutive 12-month period starting on July 1, 2004. The Company's
obligations pursuant to this paragraph 4(b) shall include all management fees,
hours, fuel, tax and flight adjustment charges, insurance (including war risk
insurance) and expenses, such as domestic and international positioning and
other fees, onboard catering, ground transportation charges and other charges
directly related to Williams' use of the airplane; provided, however, that
Williams shall promptly pay or reimburse the Company for (1) any international
positioning and other international fees, (2) crew expenses, (3) onboard
catering charges and (4) ground transportation charges, if and to the extent
that such amounts, in the aggregate, exceed $100,000 during any such consecutive
12-month period. In the event a new or amended contract is entered into between
the Company and NetJets Inc., the terms of such contract shall be no less
favorable to Williams than the terms of Contract No. 1012158 in effect as of
June 30, 2004. In the event that a Falcon 2000 airplane is no longer available,
it shall be replaced by an airplane having features, amenities and technical
specifications not less than those associated with the Falcon 2000 identified in
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Contract No. 1012158. For purposes of calculating the value of benefits provided
under this paragraph 4(b) by the Company to Williams or for his benefit,
Williams shall be deemed a "retired employee" of the Company within the meaning
of Treasury Reg. Section 1.61-21(g) promulgated under the Internal Revenue Code
of 1986, as amended.
(c) Commencing at the Effective Time, the Company will make available to
Williams, his spouse and dependent children (up to the age of 23) for his
lifetime and, if he has a spouse at his death, to her for her lifetime, and to
Williams' dependent children for as long as they remain dependent children (but
in no event past age 23), coverage under the group health plan (including
medical, hospitalization, vision, dental, prescription and other coverages
provided under the group health plan) in which the Company's senior executives
continue to participate, or if such coverage cannot reasonably be effected under
the terms of such plan, the Company will reimburse (or, at the election of
either Williams, his surviving spouse or surviving dependent children, in their
sole discretion, pay directly to a provider for their benefit) Williams and such
surviving spouse and dependent children for their healthcare expenses to the
same extent such expenses would have been reimbursed under the terms of such
plan as it was in effect immediately prior to the Effective Time, all subject to
the condition that Williams (or, in the event of his death, his spouse or
dependent children) pays the Company for such coverage the lesser of (i) the
same proportional share of the premiums for such coverage as he paid or, but for
Williams' death, would have paid for such coverage immediately prior to the
Effective Time, or (ii) the then current employee share of premiums paid by the
Company's senior executives for such coverage. The foregoing notwithstanding,
Williams shall not participate in any of the disability or life insurance plans
or policies applicable to senior executive officers or other employees of the
Company or its Affiliates.
(d) Within thirty calendar days following the Effective Time, Williams, at
his own expense, will completely vacate (i) his office space at 4401 Northside
Parkway, Atlanta, Georgia, and (ii) his garage space and other reserved parking
spaces at or related to such location.
(e) Williams may retain all furnishings located in his first floor office
space at 4401 Northside Parkway, Atlanta, Georgia, and shall be entitled to
remove such furnishings at his expense and without interference from the Company
or its Affiliates, directly or indirectly. The aggregate value of such
furnishings, as reflected on any Forms W-2 or 1099, as applicable, will not
exceed $100,000.
(f) Except as otherwise expressly stated in this Agreement and except for
any payments, perquisites and benefits accruing prior to the Effective Time, all
other payments, perquisites and benefits provided to or on behalf of the Company
or its Affiliates shall cease as of the Effective Time, and after the Effective
Time the Company and its Affiliates shall have no obligations to provide to
Williams any of the payments, perquisites, benefits and services identified in
Section 2 of the Employment Agreement.
(g) In accordance with applicable law and any applicable terms of this
Agreement, the Company (and its Affiliates) shall provide Williams with such
Forms W-
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2 or 1099 (or other tax forms as may be required by applicable law) in
connection with all payments, benefits, perquisites or services provided by the
Company to Williams under this Agreement.
5. Stock Options; Partnership Units; Retirement Plans.
(a) Notwithstanding any provision in any option agreement or option plan
to the contrary, all stock options to purchase shares of the Company's stock
previously granted to Williams, and all rights Williams has to exercise such
options shall remain outstanding and fully exercisable for the full term thereof
regardless of any provision to the contrary in any such agreement or plan
restricting the time period for exercise following termination of employment or
death. Any stock options previously granted to Williams which have not yet
vested as of the Effective Time shall fully vest at the Effective Time.
(b) Nothing contained in this Agreement shall in any way modify, limit or
terminate the rights of Williams, the Company or any other Person pursuant to
the Second Amended and Restated Agreement of Limited Partnership of Post
Apartment Homes, as amended and restated or superceded (the "Limited Partnership
Agreement") and all rights Williams or any Affiliates of Williams have to
transfer, convey, sell or convert partnership units in Post Apartment Homes
("Units") into securities of the Company in accordance with the terms and
conditions of the Limited Partnership Agreement, shall remain in full force and
effect. Notwithstanding anything contained in this Agreement or the Limited
Partnership Agreement to the contrary, Post Apartment Homes and Holdings, as
general partner of Post Apartment Homes, shall accept the form of Notice of
Redemption in the form attached to this Agreement as Exhibit A in lieu of the
form attached as Exhibit E to the Limited Partnership Agreement.
(c) Notwithstanding anything in this Agreement to the contrary, nothing in
this Agreement shall impair or affect any vested rights Williams has in any
retirement or investment plan or deferred compensation plan, including without
limitation, the Company's Employee Stock Purchase Plan, 401(k) Plan, Profit
Sharing Plan and Dividend Reinvestment Plan.
6. Standstill Covenants. Williams agrees that during the period commencing
at the Effective Time and ending on the seventh anniversary of the Effective
Time (the "Standstill Expiration Date"), without the prior written consent of
the Company's Board of Directors as expressed in a resolution duly adopted by
the Board of Directors, neither he, nor any Person acting at his direction,
will, directly or indirectly:
(a) make, engage or participate in, directly or indirectly, any
"solicitation" (as such term is used in the proxy rules of the Securities and
Exchange Commission (the "SEC")) of proxies or consents (whether or not relating
to the election or removal of directors) of matters presented to Company
shareholders; seek to advise, encourage or influence any Person with respect to
the voting of any Voting Securities (other than members of Williams' immediate
family, or for the benefit of such Persons, employees, Affiliates or Associates
or others to whom he owes a fiduciary duty in
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connection with the voting of any Voting Securities); initiate, propose or
"solicit" (as such term is used in the proxy rules of the SEC) shareholders of
the Company for the approval of shareholder proposals whether made pursuant to
Rule 14a-8 or Rule 14a-4 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), or otherwise, or cause or encourage or attempt to cause or
encourage any other Person to initiate any such shareholder proposal; otherwise
communicate with the Company's shareholders or others pursuant to Rule
14a-1(l)(2)(iv) under the Exchange Act in connection with the solicitation of
proxies or consents of matters presented to Company shareholders; or participate
in any "shareholder access" proposal which may be adopted by the SEC, whether in
accordance with proposed Rule 14a-11 or otherwise, and which involves the
Company;
(b) seek or propose, or make any public statement with respect to, any
merger, consolidation, business combination, tender or exchange offer, sale or
purchase of assets, sale or purchase of securities, dissolution, liquidation,
restructuring, recapitalization or similar transactions of or involving the
Company or any of its Affiliates;
(c) acquire, offer or propose to acquire, or agree to acquire (except by
way of stock dividends, stock splits, reverse stock splits or other
distributions or offerings made available to holders of Voting Securities
generally or otherwise involuntarily or as a result of or pursuant to any action
of or by the Company or its agents or designees), directly or indirectly,
whether by purchase, tender or exchange offer, through the acquisition of
control of another Person, by joining a partnership, limited partnership,
syndicate or other "group" (within the meaning of Section 13(d)(3) of the
Exchange Act) or otherwise, any Voting Securities; provided, however, Williams
may acquire Voting Securities upon (i) the exercise or other exchange or
conversion of stock options held by him, (ii) the conversion into shares of the
Company's common stock of Units beneficially owned by Williams or his
Affiliates, or (iii) the issuance or distribution of securities offered under
the terms of any shareholder rights or similar plan of the Company;
(d) form, join or participate in a "group" (within the meaning of Section
13(d)(3) of the Exchange Act) with respect to any Voting Securities;
(e) act, alone or in concert with others, to control or seek to control,
or intentionally influence or seek to influence, the management, Board of
Directors or policies of the Company;
(f) seek, alone or in concert with others, election or appointment to or
representation on, or nominate or propose the nomination of any candidate to,
the Company's Board of Directors, or seek the removal of any member of the
Company's Board of Directors;
(g) make any publicly disclosed proposal, public statement or public
inquiry, or publicly disclose any intention, plan or arrangement (whether
written or oral) inconsistent with the foregoing, or make or disclose any
request to amend, waive or terminate any provision of paragraph 6 of this
Agreement;
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(h) enter into any arrangements, understanding or agreements (whether
written or oral) with, or finance, or intentionally advise, assist or encourage,
any other Person in connection with any of the foregoing or make any investment
in or enter into any arrangement with, any other Person with the intent of
enabling, assisting or encouraging that Person to engage, or propose to engage,
in any of the foregoing; or
(i) otherwise intentionally take, or solicit, or cause or encourage others
to take, any action inconsistent with any of the foregoing.
Notwithstanding anything to the contrary in this paragraph 6, Williams shall
not, directly or indirectly, be restricted in any manner in his ability to (x)
vote any Voting Securities beneficially owned or controlled by him in his sole
discretion, (y) sell, gift, transfer or convey any Voting Securities
beneficially owned or controlled by him in his sole discretion or (z) engage in
casual conversation with natural persons (so long as such natural persons are
not acting on behalf of any other Person) regarding any of the matters
identified or described in this paragraph 6; provided, however, Williams shall
not engage is such casual conversations with the intent of violating paragraphs
6(a), (b), (c), (e) or (f) above or with the intent of soliciting, causing or
encouraging others to take any action inconsistent with paragraphs 6(a), (b),
(c), (e) or (f) above. Notwithstanding anything to the contrary in this
paragraph 6, so long as Williams or his Affiliates shall own or control any
Units, Williams shall be permitted to make or participate in a bona fide offer
to acquire the Company, provided that (i) such offer is for all shares of the
Company's outstanding common stock, any outstanding shares of the Company's
preferred stock, and all Units, in each case excluding such shares of common
stock, preferred stock and Units as are beneficially owned or controlled by the
Company or the party or parties making or participating in such offer and their
Affiliates; (ii) the consideration offered to the holders of (x) the Company's
common stock consists solely of cash and/or shares of common stock and (y) the
Company's preferred stock consists of cash, shares of common stock and/or shares
of preferred stock, in the cases of both clauses (x) and (y) of a
publicly-traded corporation that is then listed on the New York Stock Exchange
or traded on the Nasdaq National Market, and has been so listed or traded for a
period of not less than one consecutive year, and is eligible to register its
securities on Form S-3 under the Securities Act of 1933, as amended (the
"Securities Act"); (iii) the consideration offered to the holders of Units
consists solely of the consideration described in clause (ii) above and/or units
of a real estate investment trust operating partnership or other assets
permitting the holders of Units to effect a tax-free exchange; (iv) any cash
portion of the purchase price is fully financed; (v) no series of debt
securities publicly issued and no series or class of preferred stock publicly
issued by any corporation whose shares of common stock constitute all or a
portion of the consideration being offered is then rated below investment grade
by any one of Moody's Investors Service, Standard and Poor's Ratings Services,
Duff & Phelps Credit Rating Co. or Fitch Ratings, and if any of the foregoing
then no longer provide credit rating services, by any other credit rating agency
which is then considered a major U.S. credit rating agency; and (vi) any
corporation whose shares of common stock constitute all or a portion of the
consideration is eligible to register its securities on Form S-3 under the
Securities Act, as such eligibility requirements are then in effect (an offer
meeting all conditions contained in clauses (i) through (vi) above is referred
to herein as a "Qualifying Offer"). Nothing contained in this paragraph 6 shall
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limit or restrict Williams' ability to engage or participate in a solicitation
of proxies or to seek Board of Directors representation for himself or others,
if done in good faith in support of, and integral to, a Qualifying Offer which
Williams has previously made or participated in and which is then currently
pending.
7. Resignation as Director and Officer. By Williams' execution of this
Agreement and the execution of this Agreement by all other parties hereto,
Williams hereby resigns, upon such execution by all parties hereto, (i) as a
member and as Chairman Emeritus of the Company's Board of Directors, (ii) as a
member of all committees of the Board of Directors on which he then serves,
(iii) as a director of any direct or indirect subsidiary and other Affiliates of
the Company on whose Board of Directors he then serves and as a member of all
committees of any such Board of Directors on which he then serves, (iv) if
applicable, as a trustee of (or any similar position with) any benefit plans
maintained by, or for the benefit of employees of, the Company or any such
subsidiary, (v) if applicable, as an officer of the Company, its direct and
indirect subsidiaries and other Affiliates, and (vi) from any other positions he
holds with, or at the request of, the Company, or any of its direct or indirect
subsidiaries or other Affiliates.
8. Life Insurance.
(a) Concurrently with the execution of this Agreement, the Company shall
pay, or cause to be paid, the outstanding principal balance of $1,529,213.01
together with a Prepayment Premium of $30,584.26 to Wells Fargo Bank, National
Association ("Wells Fargo") pursuant to that certain Credit Agreement dated
October 28, 2003 by and between the Trust and Wells Fargo (the "Credit
Agreement"), whereupon the Credit Agreement and all Wells Fargo-related
collateral assignments shall be terminated, and in connection therewith shall
also pay to Wells Fargo, Williams and/or the Trust, as applicable, Termination
Costs of $27,008.85 (consisting of a Redeployment Cost of $17,008.85 to Wells
Fargo incurred in connection with such prepayment and $5,000.00 of legal costs
to each of Williams and the Trust in connection therewith). It being the
expectation of the parties hereto that the Company's payment of Prepayment
Premium and Termination Costs pursuant to this paragraph, having been incurred
by the Company to restore the parties to the positions they would have been in
if all premiums on all policies subject to the Split Dollar Agreement had been
made as originally contemplated, should not result in taxable compensation to
Williams or a taxable gift from Williams to the Trust, the parties hereto agree
to take tax reporting positions consistent with that expectation. In the event
that the Internal Revenue Service ("IRS") or the Georgia Department of Revenue
("DOR") notifies Williams and/or the Trust in writing that it takes the position
that any of the Company's payment of Prepayment Premiums or Termination Costs
pursuant to this paragraph 8 results in taxable compensation to Williams and/or
a taxable gift from Williams to the Trust, for federal or state tax purposes,
the Company will pay to Williams the amount indicated in such IRS and/or DOR
notification (including any applicable interest and penalties) together with
applicable income, gift, and estate tax gross-up payments with respect to the
amounts so payable to the IRS and/or the DOR, within five days following receipt
of a copy of said notification together with a written request for payment from
or for the benefit of
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Williams ("Payment Request"), calculated on the same terms
as described in Sections 5 and 6 of the Agreement for Continuation of Split
Dollar Arrangement and Compliance with Sarbanes-Oxley dated as of October 28,
2003, between Post Apartment Homes and the Trust (the "Split Dollar Continuation
Agreement"), which agreement shall survive the execution of this Agreement. The
Payment Request shall certify that Williams will (i) not further challenge the
position so taken by the IRS and/or DOR; (ii) not take any subsequent tax
reporting position inconsistent with the position so taken by the IRS and/or
DOR; (iii) pay to the IRS and/or DOR the amount of tax requested by the IRS
and/or DOR. Neither Williams nor the Trust shall be required to challenge the
IRS and/or DOR notification except as provided below with respect to penalties.
Notwithstanding the foregoing, to the extent the amount indicated in such IRS
and/or DOR notification includes penalties, Williams agrees to permit the
Company to contest the imposition of any such penalties on his behalf with legal
representation by Steve Parker and/or Tony Turner, Cohen Pollock Merlin Axelrod
& Small, P.C., with the cost of such representation to be paid by the Company.
If such contest of the imposition of penalties results in amounts owed by
Williams and/or the Trust in excess of those contained in the notification, for
interest or otherwise, the Company will promptly pay all such amounts to
Williams and/or the Trust, as applicable (and any penalty amount not eliminated
by such contest), together with applicable gross-up payments, as if such
additional amounts had been included in the original notification. If such
contest has not been resolved within 90 days following the date of the Payment
Request, the Company will within five days after such 90 day period pay to
Williams and/or the Trust, as applicable, the amount of the penalty plus any
interest owed as a result of the delay caused by such contest, together with
applicable gross-up payments. The Company's obligation to make tax gross-up
payments (inclusive of applicable interest and penalties) pursuant to this
paragraph shall survive both the termination or expiration of this Agreement and
the Split Dollar Continuation Agreement.
(b) The portion of the Wells Fargo loan repayment allocated to principal
shall be treated as if the Company had paid such amount as its portion of
premiums on the Policies under the Split Dollar Agreement, and such amount shall
be included in computing the total premiums paid by the Company to determine the
Company's share of any proceeds received with respect to the Policies. Such
deemed payments, however, shall be reduced by the amount, if any, which may be
attributable to any interest or other penalties or amounts attributable to such
deemed payments because of the timing of such payments under the Split Dollar
Agreement. In no event shall the Company or any of its Affiliates be entitled to
a pro-ration or refund of any payments previously made by the Company or any of
its Affiliates related to the Premium Financing and/or the Policies or otherwise
made under the Split Dollar Continuation Agreement, except as provided for under
the Split Dollar Agreement and Collateral Assignments listed in paragraph 8(d)
below. Capitalized terms used in this paragraph 8 and not otherwise defined in
this Agreement shall have the meanings ascribed to them in the Split Dollar
Continuation Agreement. The parties hereto acknowledge that the purpose of this
paragraph 8(b) is to restore the parties to the positions they would have been
in if all premiums on all policies subject to the Split Dollar Agreement had
been made as originally contemplated, and if the Split Dollar Continuation
Agreement had never gone into effect; that the Split Dollar Continuation
Agreement was intended as an
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interim and temporary solution pending resolution of certain legal uncertainties
surrounding the payment of premiums under the Split Dollar Agreement; and that
neither the Split Dollar Continuation Agreement nor this Agreement is intended
to materially modify the provisions of the Split Dollar Agreement as in effect
prior to the date of the Split Dollar Continuation Agreement. In particular, the
parties hereto acknowledge that, notwithstanding the provisions of the Split
Dollar Agreement as originally in effect, at all times since March 25, 2002, by
reason of the provisions of the Employment Agreement, the Split Dollar Agreement
is terminable only upon the first to occur of the following: (i) May 31, 2013;
(ii) the prior written consent of all parties to the Split Dollar Agreement or
(iii) the death of Williams. Notwithstanding anything contained in this
Agreement or any other agreement to the contrary, the obligations of the
Company, Williams and the Trust under the Split Dollar Agreement, this paragraph
8 and the collateral assignments listed in paragraph 8(d) below shall survive
the termination of this Agreement or the determination or declaration that this
Agreement or any provision of this Agreement or the Split Dollar Agreement is no
longer in full force and effect.
(c) Concurrently with the execution of this Agreement, the Company shall
pay to Williams the sum of $36,223.10 by wire transfer of immediately available
funds to an account specified in writing by Williams, representing the gift tax
gross-up specified in Section 6 of the Split Dollar Continuation Agreement owing
to Williams with regard to the June 1, 2004 premium payments made by Wells Fargo
under the Credit Agreement.
(d) Subject to paragraph 8(a) and 8(b) above, commencing at the Effective
Time, the Company will continue to provide, or cause to be provided to, Williams
and the Trust with a split dollar life insurance program of up to $31,000,000 on
the same terms and conditions previously agreed to in writing by the Company,
Williams and the Trust, pursuant to the terms of the (i) Split Dollar Insurance
Agreement dated March 15, 1990 between the Company and John T. Glover, in his
capacity as Trustee under agreement with John A. Williams, dated September 29,
1988; (ii) Split-Dollar Insurance Agreement dated December 23, 1998 by and
between John T. Glover, as Trustee under an Irrevocable Agreement of Trust
executed by John A. Williams as Grantor dated January 27, 1995, and Post
Apartment Homes, as amended on September 29, 1999; (iii) Collateral Assignment
dated February 17, 1999 by Owner of certain life insurance policies referenced
therein upon the life of John A. Williams in favor of Post Apartment Homes; (iv)
Supplemental Collateral Assignment Accompanying First Amendment to Split Dollar
Insurance Agreement dated September 1, 1999 by Owner of certain life insurance
policies referenced therein upon the life of John A. Williams in favor of Post
Apartment Homes; and (v) Split Dollar Continuation Agreement. The Company and
Post Apartment Homes, on the one hand, and Williams, on the other hand, shall
pay their respective portion of the annual renewal premiums (Williams to pay an
amount equal to his then economic benefit and the Company and Post Apartment
Homes to pay the balance) owed to each insurance company that has issued the
split dollar life insurance policies referenced on Exhibit A to the Split Dollar
Continuation Agreement when due, without benefit of payment extensions, grace
periods or, except as noted below, "dividend offset" or policy loans. In the
event the Company or Post Apartment Homes, on the one hand, or Williams, on the
other hand, fail to make any such annual
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premium payment when due, the other party shall be entitled to specific
performance pursuant to paragraph 13 of this Agreement; provided, however,
neither the Company, Holdings, Services or Post Apartment Homes shall be
required to make such annual premium payments for any policy identified on
Exhibit A to the Split Dollar Continuation Agreement for any year in which the
then current inforce illustration for that policy for that year, prepared by the
policy issuer in question, reflects that such policy has reached and remains at
the "dividend offset" or "vanishing" point pursuant to which the policy issuer
projects that sufficient cash value of paid-up additions has accrued along with
projected dividends in such policy to pay all future annual premiums owed on
that policy for the remainder of Williams' life, nor shall they have any
obligation to make such annual premium payments on any policy after May 2013
regardless of whether that policy has reached the dividend offset or vanishing
point. Inforce illustrations will be obtained annually from each insurer of the
policies identified on Exhibit A to the Split Dollar Continuation Agreement
until June 1, 2013 to determine whether additional annual premiums are required
to continue any such policy under the dividend offset or vanishing point
provision. For example, assume the Mass Mutual policy #11,551,443 has reached
dividend offset in policy year 11 (2008) once annual premiums for policy year 11
have been paid in full. This means the inforce illustration for that policy
reflects no additional annual premiums will be required from the policy holder
(e.g., the Company/Post Apartment Homes and Williams/Trust) commencing with the
policy renewal in year 12 (2010). All future premiums on that policy which come
due will be paid from that policy's paid-up additions and/or dividends. However,
if a subsequent inforce illustration (e.g. for 2012) reflects insufficient
paid-up additions and projected dividends to maintain the dividend offset
provision for the remainder of Williams' life and an additional premium is
required to once again reach the dividend offset, then the Company/Post
Apartment Homes and Williams/Trust each will be required to pay its
proportionate share of the annual premium in year 2012 (based on Williams paying
a portion of the premium equal to his economic benefit and Company/Post
Apartment Homes paying the balance) as so indicated.
The Company, Holdings, Services and Post Apartment Homes agree to execute
such consents as may reasonably be necessary to permit Williams or the Trust to
borrow from the cash value of any policy set forth on Exhibit A to the Split
Dollar Continuation Agreement, to the extent necessary by Williams or the Trust
to make annual premium payments on any policy for which annual premiums are no
longer being funded by the Company or Post Apartment Homes and which has not
reached and does not remain at the dividend offset or vanishing point, subject
to the collateral assignments. All parties agree to execute such additional
documentation as may be reasonably requested in order to give effect to the
provisions of this paragraph 8.
9. Mutual Releases; Non-Disparagement; Litigation.
(a) Subject to the further provisions of this paragraph 9(a), the Company,
on behalf of itself, each of its Affiliates which the Company controls and which
is not a natural person and each of their respective officers listed on Exhibit
B hereto (each, including the Company, a "Company Party", and collectively, the
11
"Company Parties"), hereby irrevocably and unconditionally releases, acquits,
and forever discharges Williams, his spouse, children, heirs, executors,
administrators and each of Williams' Affiliates which Williams controls and
which is not a natural person, and their respective officers listed on Exhibit C
hereto (each, including Williams, a "Williams Party", and collectively, the
"Williams Parties") and each natural person identified on Exhibit D hereto
(together with the Williams Parties, the "Williams Releasees"), from and with
respect to any and all disputes, complaints, claims, counterclaims, actions,
causes of action, liabilities, suits or damages (collectively "Claims"), whether
at law or in equity, statutory or otherwise, whether known or unknown, asserted
or unasserted, of every kind and nature whatsoever, that any Company Party ever
had, now has, or hereafter can, will or may have against any of the Williams
Releasees for, upon, or by reason of any matter, cause of action, or thing,
whatsoever from the beginning of the world to the date hereof, but expressly
excluding (i) any Claim relating to the performance of such parties' obligations
under this Agreement or for breach of or to enforce this Agreement, (ii) all
rights and obligations of all parties under the Limited Partnership Agreement,
(iii) all rights and obligations of the parties under any agreements relating to
Williams' split dollar life insurance program referred to in paragraph 8 above,
(iv) any Claims or other matters substantially unrelated to, or not arising from
or out of, the business, affairs, operations, assets, properties, policies or
practices of the Company or its Affiliates and (v) a specific matter with
respect to one of the Williams Releasees as set forth on Exhibit D hereto. The
foregoing notwithstanding, the release provided for in this paragraph 9(a) to
any natural person identified on Exhibit D hereto shall terminate forty-five
calendar days after the date of execution of this Agreement and be of no further
force or effect, unless prior to such forty-fifth day such natural person shall
have delivered to the Company a corresponding release in the form of Exhibit E
hereto, in which case the release of such natural person as provided in this
paragraph 9(a) shall continue in full force and effect in perpetuity.
(b) Subject to the further provisions of this paragraph 9(b), Williams, on
behalf of himself and the other Williams Parties, hereby irrevocably and
unconditionally releases, acquits, and forever discharges each of the Company
Parties and each natural person identified on Exhibit F hereto (together with
the Company Parties, the "Company Releasees") from and with respect to any and
all Claims, whether at law or in equity, statutory or otherwise, whether known
or unknown, asserted or unasserted, of every kind and nature whatsoever, that
any Williams Party ever had, now has, or hereafter can, will or may have against
any of the Company Releasees for, upon, or by reason of any matter, cause of
action, or thing, whatsoever from the beginning of the world to the date hereof,
but expressly excluding (i) any Claim relating to the performance of such
parties' obligations under this Agreement or for breach of or to enforce this
Agreement, (ii) all rights and obligations of all parties under the Limited
Partnership Agreement, (iii) all rights and obligations of the parties under any
agreements relating to Williams' split dollar life insurance program referred to
in paragraph 8 above and (iv) any Claims or other matters substantially
unrelated to, or not arising from or out of, the business, affairs, operations,
assets, properties, policies or practices of the Company or its Affiliates. The
foregoing notwithstanding, the release provided for in this paragraph 9(b) to
any natural person identified on Exhibit F hereto shall terminate forty-five
calendar days after the date of execution of this Agreement and be of no further
12
force or effect, unless prior to such forty-fifth day such natural person shall
have delivered to Williams a corresponding release in the form of Exhibit E
hereto, in which case the release of such natural person as provided in this
paragraph 9(b) shall continue in full force and effect in perpetuity.
(c) The release provided for in paragraph 9(b) above specifically includes
any Claims which any of the Williams Parties have or have had under applicable
state or federal law regarding employment discrimination or wages, including,
but not limited to, Title VII of the Civil Rights Act of 1964, as amended; 42
U.S.C. Section 1981; the Age Discrimination in Employment Act, as amended (the
"Age Discrimination Act"); the Americans with Disabilities Act; the Family and
Medical Leave Act (including any reinstatement rights thereunder); and the
Employee Retirement Income Security Act, as amended. The releases in paragraphs
9(a) and 9(b) above specifically include any claims for attorneys' fees or
expenses of litigation arising out of any dispute relating to any Claim released
herein.
(d) Effective at the Effective Time and continuing until the Standstill
Expiration Date, Williams, on behalf of himself and each of his Affiliates which
he controls and is not a natural person, and their respective officers listed on
Exhibit C hereto while they are serving as officers, agrees that he and they
will not, and will not solicit, cause or encourage others to, make any comments
or statements regarding any of the Company Parties, which are derogatory or
detrimental to any of the Company Parties. The foregoing shall not apply to
compelled testimony, either by legal process, subpoena or otherwise.
(e) Effective at the Effective Time and continuing until the Standstill
Expiration Date, the Company, on behalf of itself and each of its Affiliates
which the Company controls and is not a natural person, and each of their
respective officers listed on Exhibit B hereto while they are serving as
officers, agrees that it and they will not, and will not solicit, cause or
encourage others to, make any comments or statements regarding any of the
Williams Parties which are derogatory or detrimental to any of the Williams
Parties. The foregoing shall not apply to compelled testimony, either by legal
process, subpoena or otherwise.
(f) Effective at the Effective Time and continuing until the Standstill
Expiration Date, Williams, on behalf of himself and each of his Affiliates which
he controls and is not a natural person, and each of their respective officers
listed on Exhibit C hereto while they are serving as officers, agrees that he
and they (i) will not initiate any litigation or other legal proceedings against
any of the Company Parties, other than with respect to those matters covered by
clauses (i) through (iv) in paragraph 9(b) above, and (ii) will not solicit,
cause or encourage others to initiate or continue litigation or other legal
proceedings against any of the Company Parties.
(g) Effective at the Effective Time and continuing until the Standstill
Expiration Date, the Company, on behalf of itself and each of its Affiliates
which the Company controls and is not a natural person, and each of their
respective officers listed on Exhibit B hereto while they are serving as
officers, agrees that it and they (i) will not
13
initiate any litigation or other legal proceedings against any of the Williams
Parties, other than with respect to those matters covered by clauses (i) through
(iv) in paragraph 9(a) above, and (ii) will not solicit, cause or encourage
others to initiate or continue litigation or other legal proceedings against any
of the Williams Parties.
(h) The provisions of paragraphs 9(d), 9(e), 9(f) and 9(g) above shall not
apply to matters relating to or arising out of a Qualifying Offer.
10. Press Release. Promptly after the execution of this Agreement by all
parties hereto, the Company and Williams will issue a joint press release in the
form attached hereto as Exhibit G.
11. Representations. Williams represents and warrants to the Company that
he has had the opportunity to discuss this Agreement with an attorney, and he
has been advised by the Company to do so. Williams covenants and agrees that he
has been given at least twenty-one days to contemplate the terms of this
Agreement before executing it and that if he chooses to execute it in fewer than
twenty-one days he does so of his own free will and volition. Notwithstanding
any provision contained herein to the contrary, after execution of this
Agreement Williams has seven days to revoke his release of all Claims under the
Age Discrimination Act by delivering written notice to the Company of his
intention to revoke his release of Claims under the Age Discrimination Act;
provided, however, if Williams delivers such written notice to the Company, the
Company shall be relieved of all obligations to make the payments required by
paragraph 4(a) above and all obligations to provide the benefits required by
paragraph 4(b) above.
12. Company Covenant.
(a) No change in the control, ownership or operations or assets of the
Company or any of its Affiliates (however defined) shall have any effect
whatsoever on the obligations of the parties to this Agreement.
(b) As used in this paragraph 12, the term "Code" shall mean the Internal
Revenue Code of 1986, as amended.
(c) As used in this paragraph 12, the term "Gross Up Payment" shall mean a
payment to or on behalf of Williams which shall be sufficient to pay (i) any
excise tax described in paragraph 12(d) in full, (ii) any federal, state and
local income tax and social security and other employment tax on the payment
made to pay such excise tax as well as any excise and other additional taxes on
such payment, (iii) any interest or penalties assessed by the IRS on Williams
(or his estate) which are related to the payment of such excise tax unless such
interest or penalties are attributable to Williams' willful misconduct or gross
negligence and (iv) any federal, state and local income tax and social security
tax and other employment tax on the payment made to pay such interest or
penalties as well as any excise and additional taxes on such payment.
(d) If the Company or the Company's independent accountants determine that
any payments and benefits made available to Williams (or his estate) by the
Company or an Affiliate of the Company will result in Williams (or his estate)
being
14
subject to an excise tax under Section 4999 of the Code (or any successor
provision thereof) or if such an excise tax is assessed against Williams (or his
estate) as a result of any such payments and other benefits, the Company shall
make a Gross Up Payment to or on behalf of Williams (or his estate) as and when
any such determination or assessment is made, provided Williams (or his estate)
takes such action (other than waiving Williams' (or the estate's) right to any
payments or benefits in excess of the payments or benefits which Williams has
expressly agreed to waive under this paragraph 12(d)) as the Company reasonably
requests under the circumstances to mitigate or challenge such tax; provided,
however, if the Company or the Company's independent accountants make such a
determination and, further, determine that Williams (or his estate) will not be
subject to any such excise tax if Williams (or his estate) waives his (or its)
right to receive part of such payments or benefits and such part does not exceed
$25,000, Williams (or his estate) shall irrevocably waive his (or its) right to
receive such part if an independent accountant or lawyer retained by Williams
(or his estate) and paid by the Company agrees with the determination made by
the Company or the Company's independent accountants with respect to the effect
of such reduction in payments or benefits. Any determinations under this
paragraph 12(d) shall be made in accordance with Section 280(g) of the Code,
including any successor provision thereof, and any applicable related
regulations (whether proposed, temporary or final) and any related IRS rulings
and any related case law, and if the Company reasonably requests that Williams
(or his estate) take action to mitigate or challenge, or to mitigate and
challenge, any such tax or assessment (other than waiving Williams' right to any
payments or benefits in excess of the payments or benefits which Williams has
expressly agreed to waive under this paragraph 12(d)) and Williams (or his
estate) complies with such request, the Company shall provide Williams (or his
estate) with such information and such expert advice and assistance from the
Company's independent accountants, lawyers and other advisors as Williams (or
his estate) may reasonably request and shall pay for all expenses incurred in
effecting such compliance and any related fines, penalties interest and other
assessments.
(e) If, in the event of either (x) an actual change in the ownership or
effective control of the Company or in the ownership of a substantial portion of
the assets of the Company (as contemplated under Section 280G of the Code) or
(y) a publicly announced transaction or event which, if consummated or
completed, would reasonably be expected to result in a change in the ownership
or effective control of the Company or in the ownership of a substantial portion
of the assets of the Company (as contemplated under Section 280G of the Code),
Williams' (or his estate's) accountants advise Williams (or his estate) in
writing (with a copy of any such writing furnished promptly to the Company) that
any of the payments and benefits made available to Williams (or his estate) by
the Company or an Affiliate of the Company (whether under this Agreement or
otherwise) will result in Williams (or his estate) being subject to an excise
tax under Section 4999 of the Code (or any successor provision thereof) and the
Company or its accountants have not made such a determination pursuant to
paragraph 12(d) above, then Williams (or his estate), may, in his or its
discretion (as applicable) and upon written notice to the Company, request a
meeting with the Company's accountants (which meeting shall be held within 20
days following the receipt of such notice by the Company) in order to seek to
resolve such differences, and the Company shall request
15
that its accountants attend such meeting. If the Company's accountants do not
attend such meeting or do not agree with the position of Williams' (or his
estate's) accountants after attending such meeting, Williams or his estate may
request in writing that the Company seek a private ruling or other determination
from the IRS to determine whether or not Williams (or his estate) will be
subject to such excise tax.
(f) Following receipt by the Company of a written request from Williams
(or his estate) that the Company seek a private ruling or other determination
from the IRS pursuant to paragraph 12(e) above, the Company will submit a
private ruling or other request for a determination to the IRS no later than 90
calendar days from the date of the receipt of the request from Williams (or his
estate). Prior to such submission to the IRS, the Company will furnish Williams
(or his estate) and his (or his estate's) accountants with a draft of such
submission, affording them with a reasonable opportunity to review and to
provide comments to the Company on the submission, which the Company will
consider in good faith. Upon receipt of written notice from Williams (or his
estate) that Williams (or his estate) has requested such a ruling or
determination from the IRS, the Company will reserve an amount sufficient to
satisfy its obligations under paragraph 12(d) above unless and until the IRS
shall have ruled or otherwise made a determination with respect to whether or
not Williams (or his estate) is required to pay such excise tax. In the event
the IRS determines that Williams (or his estate) is required to pay such excise
tax, the Company shall pay Williams (or his estate) the amount required to be
paid pursuant to paragraph 12(d) above, and shall reimburse Williams (or his
estate) for its reasonable expenses (including attorneys' and other
professionals' fees and expenses) incurred in connection with paragraphs 12(e)
and 12(f).
(g) If any action at law or in equity is necessary for Williams (or his
estate) to enforce or interpret the terms of this paragraph 12, the Company
shall pay Williams' (or his estate's) reasonable expenses (including attorneys'
and other professionals' fees and expenses) with respect to such action. The
provisions of this paragraph 12 shall survive the termination or expiration of
this Agreement, unless this Agreement shall be terminated by reason of any
breach or default on the part of Williams or the Trust as finally determined by
a court of competent jurisdiction with time for appeal having expired.
13. Specific Performance. Each of Williams and the Trust, on the one hand,
and the Company, Holdings, Post Apartment Homes, and Services, on the other,
acknowledges and agrees that irreparable harm to the other would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached and that such
injury would not be compensable in damages. It is accordingly agreed that each
party hereto (the "Moving Party") will be entitled to specific performance of,
and injunctive relief to prevent any violation of, the terms hereof and the
other party or parties, as the case may be, hereto will not take action,
directly or indirectly, in opposition to the Moving Party seeking such relief on
the grounds that any other remedy or relief is available at law or in equity.
16
14. Expenses. All fees and expenses incurred in connection with the
negotiation and execution of this Agreement and all related matters will be
borne by the party incurring such fees and expenses.
15. Certain Definitions. As used in this Agreement:
(a) "Affiliates" and "Associates" and derivatives thereof have the
meanings set forth in Rule 12b-2 under the Exchange Act, and includes Persons
who become Affiliates or Associates of another Person after the date of this
Agreement;
(b) "Confidential or Proprietary Information" means any secret,
confidential or proprietary information of the Company or any of its Affiliates
not otherwise included in the definition of "Trade Secret". The term
"Confidential or Proprietary Information" does not include information that has
become generally available to the public by the act of one who has the right to
disclose such information without violating any right of the Company or any of
its Affiliates;
(c) "Multifamily Property" means any real property on which an upscale
multifamily residential-use development has been constructed or is now or
hereafter proposed to be constructed (for example, and not by way of limitation,
a property of the type managed (whether or not owned) by the Company);
(d) "Person" means any individual, partnership, corporation, limited
liability company, group, syndicate, trust, government or agency thereof, or any
other association or entity;
(e) "Trade Secret" means any trade secret as such term is defined in the
Georgia Trade Secrets Act, O.C.G.A. 10-1-760, et seq.; and
(f) "Voting Securities" means the Company's common stock, any preferred
stock issued by the Company and entitled to vote in the election of directors of
the Company, and any other securities entitled to vote in the election of
directors, or any securities convertible into, or exercisable or exchangeable
for, the Company's common stock or other securities entitled to vote in the
election of directors of the Company (including, without limitation, Units),
whether or not subject to the passage of time or other contingencies.
16. No Waiver. Any waiver by any party of a breach of any provision of
this Agreement will not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term of
this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement.
17. Successors and Assigns. All the terms and provisions of this Agreement
will inure to the benefit of and will be enforceable by and against the
successors and assigns of the parties hereto.
17
18. Entire Agreement; Amendments. This Agreement (and the Exhibits hereto)
contain the entire understanding of the parties with respect to its subject
matter. Except with respect to other agreements specifically referred to herein
as remaining in effect subsequent to the Effective Time, there are no
restrictions, agreements, promises, representations, warranties, covenants or
undertakings whether oral or written other than those expressly set forth
herein. This Agreement may be amended only by a written instrument duly executed
by the parties or their respective successors or assigns.
19. Headings. The paragraph headings contained in this Agreement are for
reference purposes only and will not effect in any way the meaning or
interpretation of this Agreement.
20. Notices. All notices and other communications hereunder will be in
writing and will be given by hand delivery (including by local or overnight
courier service) or by facsimile, receipt confirmed, to the respective parties
as follows:
If to Williams or the Trust:
John A. Williams
Corporate Holdings, LLC
Suite 400
One Overton Park
3625 Cumberland Boulevard
Atlanta, Georgia 30339
Fax: (770) 818-4101
with a copy to:
McKenna Long & Aldridge LLP
Suite 5300
303 Peachtree Street
Atlanta, Georgia 30308
Fax: (404) 527-4198
Attention: Leonard A. Silverstein, Esq.
If to the Company, Holdings, Post Apartment Homes, or Services:
c/o Post Properties, Inc.
4401 Northside Parkway
Suite 800
Atlanta, Georgia 30327
Fax: (404) 846-7880
Attention: Sherry W. Cohen, Executive V.P. & Corporate
Secretary
18
with copies to:
King & Spalding LLP
191 Peachtree Street
Atlanta, Georgia 30303
Fax: (404) 572-5100
Attention: John J. Kelley, III, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Fax: (212) 735-2000
Attention: Daniel E. Stoller, Esq.
or to such other address or fax number as the person to whom notice is given may
have previously furnished to the others in writing in the manner set forth
above.
21. Governing Law. This Agreement will be governed by and construed and
enforced in accordance with the laws of the State of Georgia, without reference
to the conflict of laws principles thereof.
22. Counterparts. This Agreement may be executed in counterparts, each of
which will be an original, but each of which together will constitute one and
the same Agreement.
23. No Admission of Liability. This Agreement shall not be construed as an
admission of liability of any party or any admission that any party has acted in
any way wrongfully toward the other. The parties specifically deny and disclaim
any such liability and wrongful conduct.
24. Rule of Construction. This Agreement has been negotiated by all
parties, and all parties have participated in the drafting of the language of
this Agreement. No rule of construction of contracts requiring that provisions
be construed against the drafter of an agreement shall be applied to this
Agreement.
25. Joint and Several Responsibility. The Company, Holdings, Post
Apartment Homes and Services shall be jointly and severally liable to Williams
and the Trust for all payments and benefits due to or for the benefit of
Williams and/or the Trust under the terms of this Agreement.
26. Severability. In the event any portion or clause of this Agreement is
deemed invalid or unenforceable in a court of law, the remainder of this
Agreement shall be severed from the invalid or unenforceable portion.
27. Attorneys' Fees. In any subsequent litigation or other action or
proceeding to enforce the terms of this Agreement, whether initiated by
Williams, the Trust, the Company, Holdings, Post Apartment Homes, or Services,
the prevailing party shall be entitled to recover its reasonable attorneys' fees
and costs, other professionals'
19
fees and costs, expert witness fees and costs, and court or similar costs, from
the other party. The provisions of this paragraph 27 shall survive the
termination or expiration of this Agreement.
28. No Setoff. The obligations of the Company, Holdings, Post Apartment
Homes, and Services to make the payments specified in this Settlement Agreement
shall be absolute, and any claim by the Company, Holdings, Post Apartment Homes,
or Services against Williams and/or the Trust shall not operate as a defense to
or setoff of any payment obligation by the Company, Holdings, Post Apartment
Homes, or Services.
29. Director and Officer Liability Coverage. The Company, Holdings, Post
Apartment Homes and Services and their respective Affiliated entities shall
maintain in effect continuing director and officer liability insurance coverage
for the benefit of Williams, as a former director and officer, on terms no less
favorable to Williams than those provided to any other former director or
officer of such entity. Except as specifically provided in this paragraph 29,
neither the Company, Holdings, Post Apartment Homes nor Services shall have any
obligation to maintain any such continuing director and officer liability
insurance coverage for the benefit of Williams. In addition, the Company,
Holdings, Post Apartment Homes and Services and their respective Affiliated
entities shall indemnify Williams against actual or threatened actions,
investigations, claims, suits or proceedings, including shareholder derivative
actions, as a former director and officer, on terms no less favorable to
Williams than those provided to any other former director or officer of such
entity.
30. Other Covenants.
(a) Simultaneously with the execution and delivery of this Agreement,
Williams is selling to Post Apartment Homes all securities of Services owned by
him beneficially or of record pursuant to that certain Purchase and Sale
Agreement attached hereto as Exhibit H.
(b) Williams hereby irrevocably withdraws his demand for a special meeting
of shareholders of Services, made pursuant to a letter dated July 28, 2004 from
Williams to Services.
(c) Williams hereby irrevocably withdraws his request to examine books and
records of Services, made pursuant to a letter from Williams to Services dated
July 30, 2004, as such request may have been thereafter modified or
supplemented.
(d) Simultaneously with the execution and delivery of this Agreement,
Williams is selling to Post Apartment Homes all securities of Addison Circle
Access, Inc., a Delaware corporation, owned by him beneficially or of record
pursuant to that certain Purchase and Sale Agreement attached hereto as Exhibit
I.
20
IN WITNESS WHEREOF, and intending to be legally bound hereby, each of the
undersigned parties has executed or caused this Agreement to be executed on the
date first above written.
ATTEST: POST PROPERTIES, INC.
/s/ Sherry W. Cohen /s/ David P. Stockert
- ------------------------------------- ---------------------------------------
Name: Sherry W. Cohen Name: David P. Stockert
Title: EVP and Secretary Title: President and Chief Executive
[Corporate Seal] Officer
ATTEST: POST GP HOLDINGS, INC.
/s/ Sherry W. Cohen /s/ David P. Stockert
- ------------------------------------- ---------------------------------------
Name: Sherry W. Cohen Name: David P. Stockert
Title: EVP and Secretary Title: President
[Corporate Seal]
ATTEST: POST APARTMENT HOMES, L.P.
/s/ Sherry W. Cohen By: Post GP Holdings, Inc., its
- ------------------------------------- General Partner
Name: Sherry W. Cohen
Title: EVP and Secretary
[Corporate Seal]
/s/ David P. Stockert
---------------------------------------
Name: David P. Stockert
Title: President
ATTEST: POST SERVICES, INC.
/s/ Sherry W. Cohen /s/ David P. Stockert
- ------------------------------------- ---------------------------------------
Name: Sherry W. Cohen Name: David P. Stockert
Title: EVP and Secretary Title: President
[Corporate Seal]
NOTARY: /s/ John A. Williams
---------------------------------------
JOHN A. WILLIAMS
/s/ JoAnn Willoughby
- -------------------------------------
Name: JoAnn Willoughby
Title: Executive Assistant
[Notarial Seal]
NOTARY: THE JOHN A. WILLIAMS
IRREVOCABLE TRUST DATED
/s/ JoAnn Willoughby JANUARY 27, 1995
- -------------------------------------
Name: JoAnn Willoughby /s/ B. Wilmont Williams
Title: Executive Assistant ---------------------------------------
[Notarial Seal] Name: B. Wilmont Williams, Trustee
Title: Trustee
21
Exhibit A
Form of Notice of Redemption
NOTICE OF REDEMPTION
The undersigned Limited Partner (the "Transferor") hereby irrevocably (i)
redeems ________ Common Partnership Units (the "Units") in Post Apartment Homes,
L.P. (the "Partnership") in accordance with the terms of the Second Amended and
Restated Agreement of Limited Partnership of Post Apartment Homes, L.P., as
amended (the "Agreement"), and the Redemption Right referred to therein, (ii)
surrenders such Units and all right, title and interest therein, and (iii)
directs that the Cash Amount or REIT Shares Amount (as determined by the General
Partner) deliverable upon exercise of the Redemption Right be delivered to the
address specified below, and if REIT Shares are to be delivered, such REIT
Shares be registered and placed in the name(s) and at the address(es) specified
below. The undersigned hereby represents, warrants, certifies and agrees (a)
that the undersigned has good, marketable and unencumbered title to such Units,
free and clear of the rights or interests of any other person or entity, (b)
that the undersigned has the full right, power and authority to redeem and
surrender such Units as provided herein, and (c) that the undersigned has
obtained the consent or approval of all persons or entities, if any, having the
right to consent to or approve such redemption and surrender.(1)
In the event that either Post Properties, Inc. or the General Partner (the
"Transferee") acquires the Units in the Partnership offered for redemption
hereunder pursuant to Section 8.6 of the Agreement, then the Transferor and the
Transferee, by its acceptance of the Units, does hereby recognize, acknowledge
and agree that the Transferee shall succeed to all of the rights and obligations
of the Transferor arising from and after the date hereof with respect to such
Units, including, without limitation, the right to receive all distributions
from the Partnership (with respect to such Units and the shares of Net Income,
Net Losses, Recapture Income, and any other items of income, gain, loss,
deduction and credit of the Partnership attributable to such Units, except that
the Transferee shall not succeed to (and the Transferor shall retain) the
Transferor's obligations under Section 13.3 of the Agreement to make capital
contributions to the Partnership with respect to such Units. Accordingly, the
Transferor shall continue to be treated as holding such Units solely for the
purposes of applying Sections 6.1(B)(4) and 13.3 of the Agreement, and the
Transferor shall indemnify and hold the Transferee wholly harmless from and
against any liability whatsoever with respect to the obligations of the
Transferor under Section 13.3 of the Agreement.
- --------------------
(1) To the extent that the Company's Registration Statement on Form S-3 (No.
33-81772) ceases to be effective or is subject to a stop order issued by the
Securities and Exchange Commission temporarily suspending the effectiveness of
such Registration Statement, this form may be modified to add appropriate
representations to support a valid private placement of REIT Shares in
connection with a Unit redemption. Notwithstanding the foregoing, to the extent
that any REIT Shares issued to Williams or one of his Affiliates pursuant to a
Unit redemption are freely tradable pursuant to Rule 144(k) at the time of
issuance, the Company will cause such shares to be issued free of any
restrictive legends.
All capitalized terms used herein without definition have the meanings set
forth in the Agreement.
Dated: _________________
Name of Limited Partner: _______________________________________________
_________________________________________
(Signature of Limited Partner)
_________________________________________
(Street Address)
_________________________________________
(City, State, and Zip Code)
Signature Guaranteed by:
_________________________________________
If REIT Shares are to be issued, issue to: _____________________________________
Please insert social security or identifying number: ___________________________
Name: _______________________________________
Address: ____________________________________
ACKNOWLEDGED AND AGREED:
POST APARTMENT HOMES, L.P.
By: POST GP HOLDINGS, INC.
General Partner
By: _______________________________
Name:
Title:
Attest: ___________________________
Name:
Title:
[CORPORATE SEAL]
By: POST LP HOLDINGS, INC., a
Limited Partner, for itself and
as attorney-in-fact for Limited
Partners (other than Post LP
Holdings, Inc.)
By: _______________________________
Name:
Title:
Attest: ___________________________
Name:
Title:
[CORPORATE SEAL]
Exhibit B
Company Officers
Sherry W. Cohen
John B. Mears
Christopher J. Papa
Arthur J. Quirk
Thomas D. Senkbeil
David P. Stockert
Thomas L. Wilkes
Exhibit C
Williams Officers
John A. Williams, Jr.
Mark A. Johnson
Susan D. Porter
Jo Ann Willoughby
Exhibit D
Additional Williams Releasees
Walter C. Butler, III
Margaret C. Condon
Richard A. Denny, III
Brian Drummond
W. Daniel Faulk, Jr.*
- ----------------------
* Notwithstanding the provisions of paragraph 9(a), it is understood and agreed
by all parties that any release by any Company Party in favor of W. Daniel
Faulk, Jr. shall expressly exclude any and all of Mr. Faulk's obligations
under that certain Promissory Note, dated December 12, 1999, pursuant to
which Mr. Faulk promises to make certain payments to Post Apartment Homes
L.P.
Exhibit E
Form of Release
RELEASE
In consideration of obtaining a Release from the [Williams/Company]
Parties as set forth in paragraph [9(a)/9(b)] of that certain Settlement and
Separation Agreement, dated August 27, 2004 (the "Settlement Agreement"), by and
among John A. Williams, an individual resident of the State of Georgia
("Williams"), and The John A. Williams Irrevocable Trust Dated January 27, 1995,
on the one hand, and Post Properties, Inc., a Georgia corporation (the
"Company"), Post GP Holdings, Inc., a Georgia corporation, Post Apartment Homes,
L.P., a Georgia limited partnership, and Post Services, Inc., a Georgia
corporation, on the other, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound, the undersigned hereby
irrevocably and unconditionally releases, acquits, and forever discharges each
of the [Williams/Company] Parties from and with respect to any and all disputes,
complaints, claims, counterclaims, actions, causes of action, liabilities, suits
or damages (collectively "Claims"), whether at law or in equity, statutory or
otherwise, whether known or unknown, asserted or unasserted, of every kind and
nature whatsoever, that the undersigned ever had, now has, or hereafter can,
will or may have against any [Company/Williams] Party for, upon, or by reason of
any matter, cause of action, or thing, whatsoever from the beginning of the
world to the date of the Settlement Agreement, but expressly excluding (i) all
rights and obligations of all parties under the Post Apartment Homes, L.P.
Limited Partnership Agreement and (ii) any Claims or other matters substantially
unrelated to, or not arising from or out of, the business, affairs, operations,
assets, properties, policies or practices of the Company, or its Affiliates.
Capitalized terms used in this Release and not otherwise defined in this Release
shall have the meanings ascribed to them in the Settlement Agreement.
The undersigned represents and warrants that [he/she] has had the
opportunity to discuss the terms of this Release with an attorney, that the
undersigned understands its terms and that the undersigned has executed and
delivered this Release freely, voluntarily and without coercion.
Name (Signature): ___________________________
Name (Print): _____________________________
Dated: _____________ ____, 2004
Exhibit F
Additional Company Releasees
Lori K. Addicks
Robert L. Anderson
Janet M. Appling
S. Glenn Austin
Arthur M. Blank
Herschel M. Bloom
Carl D. Bonner
Patricia R. Carlson
Douglas Crocker II
Walter M. Deriso, Jr.
Russell R. French
John T. Glover
Robert C. Goddard, III
John Hooks
M. Catherine Howell
Janie S. Maddox
Nicholas B. Paumgarten
Charles E. Rice
Linda J. Ricklef
Glen P. Smith
David P. Stockert
L. Barry Teague
S. Jamie Teabo
Todd T. Tibbitts
Laura J. Vanloh
Ronald de Waal
Exhibit G
Form of Press Release
POST PROPERTIES AND JOHN WILLIAMS RESOLVE ALL
OUTSTANDING DIFFERENCES
-- Williams Steps Down From Board of Directors of Post Properties --
ATLANTA, August 27, 2004 -- Post Properties, Inc. (NYSE: PPS), an Atlanta-based
real estate investment trust, and John A. Williams, the Company's founder and
Chairman Emeritus, jointly announced today that they have entered into a
settlement agreement resolving all their outstanding differences.
Under the terms of the agreement, Mr. Williams' Employment Agreement and
Noncompetition Agreement have been terminated. In addition, Mr. Williams
resigned from Post Properties' Board of Directors effective immediately. The
Company agreed to continue to provide Mr. Williams with certain payments and
benefits until May 31, 2013, which would have been the approximate expiration
date of the Employment Agreement.
The agreement provides for customary standstill covenants by Mr. Williams for a
period of seven years. The parties also exchanged mutual releases and agreed to
non-disparagement and no litigation covenants.
In February 2003, the Company recorded a charge for the present value of the
estimated payments under Mr. Williams' Employment Agreement. Because the present
value of the estimated payments under the settlement agreement approximates the
Company's remaining accrued charge under the Employment Agreement, the Company
does not currently anticipate an additional accrual in connection with this
settlement.
Robert C. Goddard, III, the Company's Chairman of the Board, said, "We are
extremely pleased that we have been able to put our differences behind us, and
that the Board and management can focus their full attention on the Company's
business and improving value for the benefit of all shareholders. This past year
and a half has been a challenging period for the Company, but I believe we have
emerged with a Board of Directors which is united in its determination to help
the Company realize the value of its assets. Post Properties owes much to John
Williams, and we wish him well in the future."
Mr. Williams said, "This was the right time for an amicable parting. My activism
has resulted in positive changes at Post Properties, particularly in the
important area of corporate governance. And, with three new recently-elected,
independent directors in place, I am now comfortable leaving my position on the
Post Properties Board of Directors. I intend to pursue my own interests in real
estate investment and development, and I will always maintain a deep affection
for Post."
[INSERT STANDARD PARAGRAPHS]
Exhibit H
STOCK TRANSFER, RELEASE AND INDEMNITY AGREEMENT
STOCK TRANSFER AGREEMENT, dated as of August 27, 2004 (this "Agreement"),
between John A. Williams (the "Seller"), an individual resident of the State of
Georgia, Post Apartment Homes, L.P. (the "Purchaser"), a Georgia limited
partnership and Post Services, Inc., a Georgia corporation (the "Company").
BACKGROUND
The Seller is the owner of Fifty Five (55) shares (the "Shares") of Voting
Common Stock, $.01 par value per share, of the Company. The Purchaser desires to
purchase the Shares from the Seller, and the Seller desires to sell the Shares
to the Purchaser, on the terms and conditions set forth below. In connection
with such purchase and sale, the parties to this Agreement also desire to enter
into a mutual release and to provide certain indemnities.
NOW, THEREFORE, the parties hereto for good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged hereby agree as follows:
1. Sale of Shares; Purchase Price.
(a) Subject to the terms and conditions set forth herein, the
Purchaser shall purchase the Shares from the Seller, and the Seller shall sell
the Shares to the Purchaser, for a total price of Eleven Thousand Dollars
($11,000.00) (the "Purchase Price").
(b) The Seller has delivered to the Purchaser certificate
number 1 of the Company representing 1 share of Voting Common Stock and
certificate number 4 of the Company representing 54 shares of Voting Common
Stock each accompanied by an executed stock transfer power duly endorsed in
blank, free and clear of all liens, claims, charges, security interests, and
encumbrances of any kind whatsoever against delivery by the Purchaser of a check
in the amount of the Purchase Price.
2. Representations and Warranties of Seller. The Seller represents
and warrants that:
(a) The Seller owns the Shares, of record and beneficially,
free and clear of all liens, claims, charges, security interests, and
encumbrances of any kind whatsoever.
(b) The Seller has full right, power and authority to execute,
deliver and perform this Agreement and to carry out the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by the Seller and constitutes a valid, binding obligation of the
Seller, enforceable against the Seller in accordance with its terms (except as
such enforceability may be limited by laws affecting creditor's rights
generally).
(c) The Seller has in connection with the transactions
contemplated hereby and all aspects thereof, dealt directly with the Purchaser
and has no arrangement or understanding with or obligation to any broker or
other intermediary.
3. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants that:
(a) The Purchaser has full right, power and authority to
execute, deliver and perform this Agreement and to carry out the transactions
contemplated hereby. This Agreement has been duly and validly executed by the
Purchaser, constitutes a valid obligation of the Purchaser, is legally binding
on the Purchaser and is enforceable against the Purchaser in accordance with its
terms (except as such enforceability may be limited by laws affecting creditors'
rights generally).
(b) The Purchaser is acquiring the Shares for its own account
(and not for the account of others) for investment and not with a view to the
distribution or resale thereof.
(c) Purchaser understands that the Shares have not been
registered under the Act or under any state securities laws and, therefore,
cannot be resold unless they are registered thereunder or unless an exemption
from registration is available. Purchaser has reviewed the form of the
certificate representing such Shares and understand that it bears a legend
reflecting the foregoing restrictions.
4. Mutual Release.
(a) Subject to the further provisions of this paragraph 5(a),
the Purchaser and the Company (collectively, the "Company Parties"), hereby
irrevocably and unconditionally release, acquit, and forever discharge the
Seller, his spouse, children, heirs, executors and administrators (together, the
"Seller Parties"), from and with respect to any and all disputes, complaints,
claims, counterclaims, actions, causes of action, liabilities, suits or damages
(collectively "Claims"), whether at law or in equity, statutory or otherwise,
whether known or unknown, asserted or unasserted, of every kind and nature
whatsoever, that the Company Parties ever had, now has, or hereafter can, will
or may have against any of the Seller Parties for, upon, or by reason of any
matter, cause of action, or thing, whatsoever from the beginning of the world to
the date hereof relating to the Company, but expressly excluding (i) any Claim
relating to the performance of such parties' obligations under this Agreement or
for breach of or to enforce this Agreement and (ii) any Claims or other matters
substantially unrelated to, or not arising from or out of, the business,
affairs, operations, assets, properties, policies or practices of the Company.
(b) Subject to the further provisions of this paragraph 5(b),
the Seller, on behalf of himself and the other Seller Parties, hereby
irrevocably and unconditionally releases, acquits, and forever discharges each
of the Company Parties from and with respect to any and all Claims, whether at
law or in equity, statutory or otherwise, whether known or unknown, asserted or
unasserted, of every kind and nature whatsoever,
that any Seller Party ever had, now has, or hereafter can, will or may have
against any of the Company Parties for, upon, or by reason of any matter, cause
of action, or thing, whatsoever from the beginning of the world to the date
hereof relating to the Company, but expressly excluding (i) any Claim relating
to the performance of such parties' obligations under this Agreement or for
breach of or to enforce this Agreement, and (ii) any Claims or other matters
substantially unrelated to, or not arising from or out of, the business,
affairs, operations, assets, properties, policies or practices of the Company.
5. Indemnification.
(a) The Company and the Purchaser shall jointly and severally
indemnify to the fullest extent permitted by the Georgia Business Corporation
Code, and to the extent that applicable law from time to time in effect shall
permit indemnification that is broader than provided in this Agreement, then to
the maximum extent authorized by law, the Seller, if he is made a party to a
proceeding because he is or was a director or officer of the Company, against
liability, incurred in the proceeding, if he acted in good faith and, while
acting in an official capacity as a director or officer, acted in a manner he
reasonably believed to be in the best interest of the Company, and in all other
cases, acted in a manner he reasonably believed was not opposed to the best
interest of the Company, and with respect to any criminal proceeding, if he had
no reasonable cause to believe his conduct was unlawful.
(b) The Company and the Purchaser shall jointly and severally
pay for or reimburse the reasonable expenses incurred by the Seller if he
becomes party to a proceeding, if in advance of disposition of a proceeding:
(i) the Seller furnishes the Company and the Purchaser a
written affirmation of his good faith belief that he has met
the standard of conduct set forth in Section 6(a) above; and
(ii) the Seller furnishes the Company and the Purchaser
a written undertaking, executed personally on his behalf to
repay any advances if it is ultimately determined that he is
not entitled to indemnification.
To the extent not otherwise defined, terms used in this Section 6 shall have the
meanings set forth in Section 14-2-850 of the Georgia Business Corporation Code.
6. Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, personal
representatives, successors and assigns.
7. Governing Law. This Agreement shall in all respects be governed
by the laws of the State of Georgia without giving effect to the principles of
conflicts of law thereof.
8. Entire Agreement. This Agreement constitutes the entire
arrangement between the parties with respect to the Shares and cannot be
changed, modified, discharged or terminated except by a writing signed by the
party against whom enforcement of any change, modification, discharge or
termination is sought.
9. Assignment. Neither party may assign their rights or delegate
their duties hereunder without the prior written consent of the other party.
10. Captions. The captions used in this Agreement are for
convenience only and shall not be deemed as, or construed as, a part of this
Agreement.
11. Attorneys Fees. In any subsequent litigation or other action or
proceeding to enforce the terms of this Agreement, whether initiated by Seller,
the Company or the Purchaser, the prevailing party shall be entitled to recover
its reasonable attorneys' fees and costs, other professionals' fees and costs,
expert witness fees and costs, and court or similar costs, from the other party.
12. Counterparts; Facsimile Execution. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original,
and all of which shall constitute one and the same instrument. Facsimile
execution and delivery of this Agreement is legal, valid and binding execution
and delivery for all purposes.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SELLER:
________________________________________
John A. Williams
PURCHASER:
POST APARTMENT HOMES, L.P.
By: Post GP Holdings, Inc., its general
partner
By: ____________________________________
Sherry W. Cohen
Executive Vice President
and Secretary
THE COMPANY:
POST SERVICES, INC.
By: ____________________________________
Sherry W. Cohen
Executive Vice President
and Secretary
Exhibit I
STOCK TRANSFER, RELEASE AND INDEMNITY AGREEMENT
STOCK TRANSFER AGREEMENT, dated as of August 27, 2004 (this "Agreement"),
between John A. Williams (the "Seller"), an individual resident of the State of
Georgia and Post Apartment Homes, L.P. (the "Purchaser"), a Georgia limited
partnership and Addison Circle Access, Inc., a Delaware corporation (the
"Company").
BACKGROUND
The Seller is the owner of Twenty Four (24) shares (the "Shares") of
Voting Common Stock, $.01 par value per share, of the Company. The Purchaser
desires to purchase the Shares from the Seller, and the Seller desires to sell
the Shares to the Purchaser, on the terms and conditions set forth below. In
connection with such purchase and sale, the parties to this Agreement also
desire to enter into a mutual release and to provide certain indemnities.
NOW, THEREFORE, the parties hereto for good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged hereby agree as follows:
1. Sale of Shares; Purchase Price.
(a) Subject to the terms and conditions set forth herein, the
Purchaser shall purchase the Shares from the Seller, and the Seller shall sell
the Shares to the Purchaser, for a total price of Two Thousand Four Hundred
Dollars ($2,400) (the "Purchase Price").
(b) The Seller has delivered to the Purchaser certificate
number 005 of the Company representing 24 shares of Voting Common Stock which is
accompanied by an executed stock transfer power duly endorsed in blank, free and
clear of all liens, claims, charges, security interests, and encumbrances of any
kind whatsoever against delivery by the Purchaser of a check in the amount of
the Purchase Price.
2. Representations and Warranties of Seller. The Seller
represents and warrants that:
(a) The Seller owns the Shares, of record and beneficially,
free and clear of all liens, claims, charges, security interests, and
encumbrances of any kind whatsoever.
(b) The Seller has full right, power and authority to execute,
deliver and perform this Agreement and to carry out the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by the Seller and constitutes a valid, binding obligation of the
Seller, enforceable against the Seller in accordance with its terms (except as
such enforceability may be limited by laws affecting creditor's rights
generally).
(c) The Seller has in connection with the transactions
contemplated hereby and all aspects thereof, dealt directly with the Purchaser
and has no arrangement or understanding with or obligation to any broker or
other intermediary.
3. Representations and Warranties of the Purchaser. The
Purchaser represents and warrants that:
(a) The Purchaser has full right, power and authority to
execute, deliver and perform this Agreement and to carry out the transactions
contemplated hereby. This Agreement has been duly and validly executed by the
Purchaser, constitutes a valid obligation of the Purchaser, is legally binding
on the Purchaser and is enforceable against the Purchaser in accordance with its
terms (except as such enforceability may be limited by laws affecting creditors'
rights generally).
(b) The Purchaser is acquiring the Shares for its own account
(and not for the account of others) for investment and not with a view to the
distribution or resale thereof.
(c) Purchaser understands that the Shares have not been
registered under the Act or under any state securities laws and, therefore,
cannot be resold unless they are registered thereunder or unless an exemption
from registration is available. Purchaser has reviewed the form of the
certificate representing such Shares and understand that it bears a legend
reflecting the foregoing restrictions.
4. Mutual Release.
(a) Subject to the further provisions of this paragraph 5(a),
the Purchaser and the Company (collectively, the "Company Parties"), hereby
irrevocably and unconditionally release, acquit, and forever discharge the
Seller, his spouse, children, heirs, executors and administrators (together, the
"Seller Parties"), from and with respect to any and all disputes, complaints,
claims, counterclaims, actions, causes of action, liabilities, suits or damages
(collectively "Claims"), whether at law or in equity, statutory or otherwise,
whether known or unknown, asserted or unasserted, of every kind and nature
whatsoever, that the Company Parties ever had, now has, or hereafter can, will
or may have against any of the Seller Parties for, upon, or by reason of any
matter, cause of action, or thing, whatsoever from the beginning of the world to
the date hereof relating to the Company, but expressly excluding (i) any Claim
relating to the performance of such parties' obligations under this Agreement or
for breach of or to enforce this Agreement and (ii) any Claims or other matters
substantially unrelated to, or not arising from or out of, the business,
affairs, operations, assets, properties, policies or practices of the Company.
(b) Subject to the further provisions of this paragraph 5(b),
the Seller, on behalf of himself and the other Seller Parties, hereby
irrevocably and unconditionally releases, acquits, and forever discharges each
of the Company Parties
from and with respect to any and all Claims, whether at law or in equity,
statutory or otherwise, whether known or unknown, asserted or unasserted, of
every kind and nature whatsoever, that any Seller Party ever had, now has, or
hereafter can, will or may have against any of the Company Parties for, upon, or
by reason of any matter, cause of action, or thing, whatsoever from the
beginning of the world to the date hereof relating to the Company, but expressly
excluding (i) any Claim relating to the performance of such parties' obligations
under this Agreement or for breach of or to enforce this Agreement, and (ii) any
Claims or other matters substantially unrelated to, or not arising from or out
of, the business, affairs, operations, assets, properties, policies or practices
of the Company.
5. Indemnification. The Company and the Purchaser shall jointly and
severally indemnify the Seller for any and all actions taken as a director,
officer, employee or agent of the Company to the fullest extent permitted by the
General Corporation Law of Delaware. Notwithstanding the foregoing, to the
extent that the General Corporation Law of Delaware from time to time in effect
shall permit indemnification that is broader than provided in this Agreement,
then the Company and the Purchaser shall jointly and severally indemnify the
Seller to the maximum extent authorized by law. In addition, the Company and the
Purchaser shall jointly and severally advance certain expenses to the Seller in
accordance with Section 145 of the General Corporation Law of Delaware;
provided, that, in connection with the advancement of any such expenses, the
Seller must provide an undertaking to repay any such expenses if it shall
ultimately be determined that the Seller is not entitled to be indemnified by
the Company or the Purchaser.
6. Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, personal
representatives, successors and assigns.
7. Governing Law. This Agreement shall in all respects be governed
by the laws of the State of Georgia without giving effect to the principles of
conflicts of law thereof.
8. Entire Agreement. This Agreement constitutes the entire
arrangement between the parties with respect to the Shares and cannot be
changed, modified, discharged or terminated except by a writing signed by the
party against whom enforcement of any change, modification, discharge or
termination is sought.
9. Assignment. Neither party may assign their rights or delegate
their duties hereunder without the prior written consent of the other party.
10. Captions. The captions used in this Agreement are for
convenience only and shall not be deemed as, or construed as, a part of this
Agreement.
11. Attorneys Fees. In any subsequent litigation or other action or
proceeding to enforce the terms of this Agreement, whether initiated by Seller,
the Company
or the Purchaser, the prevailing party shall be entitled to recover its
reasonable attorneys' fees and costs, other professionals' fees and costs,
expert witness fees and costs, and court or similar costs, from the other party.
12. Counterparts; Facsimile Execution. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original,
and all of which shall constitute one and the same instrument. Facsimile
execution and delivery of this Agreement is legal, valid and binding execution
and delivery for all purposes.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SELLER:
____________________________________
John A. Williams
PURCHASER:
POST APARTMENT HOMES, L.P.
By: Post GP Holdings, Inc., its
general partner
By: ________________________________
Sherry W. Cohen
Executive Vice President
and Secretary
THE COMPANY:
ADDISON CIRCLE ACCESS, INC.
By: ________________________________
Sherry W. Cohen
Executive Vice President
and Secretary