Exhibit 10.23
SEPARATION AND GENERAL RELEASE AGREEMENT
This Separation and General Release
Agreement (the “ Agreement ”), is made as of
April 2, 2007and will be effective as of December 31,
2007, by and between J. Lindsay Freeman ( “
Freeman ” ) , an individual, Archstone-Smith
Operating Trust , a Maryland real estate investment trust (the
“ Operating Trust ”) and Archstone-Smith
Trust , a Maryland real estate investment trust (the “
ASN ”) (Operating Trust and ASN are collectively
referred to as the “ Company ”).
WHEREAS, Freeman is currently
the Chief Operating Officer (the “ COO ”) of the
Company, and
WHEREAS , the Company and the
Executive desire to establish the terms and conditions of
Freeman’s resignation as COO, continued employment with the
Company during 2008 and subsequent retirement from the Company
Agreement on the terms and conditions contained herein,
NOW, THEREFORE , for and in
consideration of the mutual promises and covenants herein contained
and for good and valuable consideration, the sufficiency of which
is hereby acknowledged, Freeman and the Company (the “
Parties ”) hereby agree as follows:
1. Officer Resignation.
Freeman shall take all necessary and appropriate actions to resign
his position as COO of the Company and as an officer and/or
director of all subsidiaries of the Company effective
December 31, 2007 (the “ Resignation Date
”). Following the resignation as Chief Operating Officer,
Freeman shall remain employed through December 31, 2008.
2. Termination
Date/Salary. Freeman’s employment with the Company shall
be continued through December 31, 2008 (the “
Termination Date ”). During the term of
Freeman’s employment, the Company shall continue to pay to
Freeman his base salary at the rate of $450,000, less applicable
withholdings and deductions for the period beginning with the
Resignation Date and ending on the Termination Date. The salary
payments shall be made in bi-weekly payments in accordance with the
Company’s usual payroll practices.
3. Restricted Stock
Units. Provided that Freeman complies with the terms of this
Agreement, executes a release containing terms substantially
similar to those contained in Section 17 within 30 days
following his Termination Date (the “ Termination
Release ”), and does not rescind or seek to have
overturned or declared invalid the Termination Release, and subject
to the other terms, conditions and limitations of the
Archstone-Smith Trust 2001 Long-Term Incentive Plan (the “
LTIP ”) and the applicable Restricted Share Unit
Agreement, all unvested restricted share units awarded prior to
Freeman’s Resignation Date shall continue to vest following
the Resignation Date in accordance with their terms without
requiring Freeman’s continued employment by the Company. The
provisions of this Section shall constitute an amendment of any
Restricted Share Unit Agreement pursuant to which restricted share
units would vest after December 31, 2008.
4. Long-Term Incentive
Plan. As an additional severance payment, upon Freeman’s
Termination Date, and provided Freeman complies with the terms of
this Agreement and execute and does not seek to invalidate the
Termination Release, Freeman shall be entitled to an amount of cash
equal to 2/3 of the value of the performance units to which he
would be entitled had he remained employed through the entire
performance period described in the Performance Unit Agreement
between Freeman and ASN dated as of May 2, 2007 (the “
Unit Agreement ”). Freeman acknowledges that the
determination of the amount shall not be made until 2009 in
accordance with the procedures established for making LTIP awards
to other executives of the Company, shall not be made until at
least 6 months following the Termination Date, and shall only
be made in the event no award is made under the Unit
Agreement.
5. Benefits. Following
Freeman’s resignation as COO, Freeman shall remain eligible
for all benefits generally available to employees of the Company;
provided, however, that Freeman shall not be entitled to any bonus,
LTIP award or restricted stock unit or other stock based award with
respect to services performed during 2008.
(a) Upon the Termination Date,
Freeman shall be entitled to those benefits provided under the
terms, conditions and limitations of the Company’s retirement
and welfare benefit plans or programs (excluding any severance
program) subject to the provisions of the applicable plan or
program.
(b) Except as expressly provided in
this Agreement, the Company will not provide to Freeman any other
compensation, whether or not accrued, directly or indirectly, in
connection with Freeman’s termination of employment with the
Company.
(c) The Company shall continue to
indemnify and hold harmless Freeman for all actions taken by
Freeman during his employment in accordance with Freeman’s
existing terms of employment.
6. Change in Control
Agreement. The parties agree that the Change in Control
Agreement between Freeman and the Company dated August 12,
2002 shall expire as of the Resignation Date.
7. Representations.
(a) Freeman represents and warrants
that he has brought no charges, complaints, claims, actions or
proceedings against the Company as of the date of this Agreement.
Freeman further agrees that he will not commence any lawsuit or, to
the fullest extent permitted by law, other proceedings against the
Company with respect to any cause, matter, claim, act or omission
occurring thereafter, provided, however, that this shall not limit
Freeman from enforcing his rights under this Agreement.
(b) Freeman represents and warrants
that as of the Termination Date he will return to the Company all
property of the Company in whatever form retained, including any
copies thereof, in the possession of or under the control of
Freeman, including, but without limitation, all budget information
and all notes, memoranda and meeting details regarding operations
of the Company, all of which shall be delivered to the Chief
Operating Officer of the Company on or immediately after the
Termination Date.
(c) Freeman will not disparage the
Company or any of its shareholders, trustees, officers, employees
or agents. The Company will not disparage Freeman.
8. Non-Disclosure.
(a) Confidential Information
Defined . Freeman has created, has had contact with, use
of, and received confidential information and/or trade secrets of
Company, including, but not limited to, data concerning existing or
proposed advertising proposals or campaigns, marketing and sales
research, techniques, manuals, programs, systems, designs, computer
programs, formulas, pricing, bidding methods, innovations,
inventions, discoveries, improvements, research and development,
specifications, data, know-how, formats, marketing plans, business
plans and strategies, investment and disposition strategies,
information regarding the skills and compensation of other
employees of Company, forecasts, financial information, budgets,
projections, and customer and/or supplier identities,
characteristics, preferences and agreements (collectively “
Confidential Information ”). Confidential Information
may be contained
in materials
including, but not limited to, customer lists, supplier lists and
price lists, reports or computer programs, as well as be
constituted by unwritten information, techniques, processes,
practices or knowledge. Confidential Information includes all
information disclosed by Company to Freeman and information
developed or learned by Freeman while a shareholder, officer and/or
employee of Company. Confidential Information includes all
information that has or could have commercial value or other
utility in the business in which Company has been engaged or in
which it is contemplated engaging. Confidential Information also
includes all information of which the unauthorized disclosure could
be detrimental to the interests of Company, whether or not such
information is identified as Confidential Information by
Company.
(b) Scope . For the
“ Restricted Period ” (as hereinafter defined)
Freeman will not, either directly or indirectly, for
Freeman’s own benefit or for the benefit of any third party,
use, divulge, disclose, or communicate to any third party, any of
the Confidential Information in any manner whatsoever, unless the
Company otherwise consents to the disclosure or use of any of the
Confidential Information in writing prior to such disclosure or
use. With respect to each particular item of Confidential
Information, the “Restricted Period” shall mean:
(a) the period ending on March 31, 2011, if the item of
Confidential Information at issue does not constitute a trade
secret, or (b) indefinitely, if the item of Confidential
Information at issue constitutes a trade secret, until such item of
Confidential Information at issue ceases to be a trade secret, but
in no event earlier than March 31, 2011 if the item continues
to be Confidential Information. Notwithstanding the foregoing,
Confidential Information does not include information (i) in
the public domain, (ii) received by Freeman outside of
Freeman’s relationship with Company as a shareholder,
director, officer and/or employee, from a party not under an
obligation of confidentiality to Company, directly or indirectly,
or (iii) that later becomes public, unless such information is
made public by Freeman in breach of this Agreement or any other
agreement by which Freeman is bound or by any other party directly
or indirectly under an obligation of confidentiality to
Company.
9. Covenant
Not-To-Compete. To protect the Company’s proprietary
interest in the Confidential Information and to protect the
goodwill and value of the Business of Company (hereafter defined),
Freeman shall not, except with the prior written consent of the
Company, for the Non-Compete Term (as hereafter defined) anywhere
in the United States of America, its respective territories,
possessions and protectorates, engage, directly or indirectly,
individually or in association or in combination with any other
person or entity, as proprietor or owner, officer, director or
shareholder (other than as a passive investor in and holder of less
than five percent (5%) of the common stock of any publicly traded
corporation), member or manager of any limited liability company,
or as an employee, agent, independent contractor, consultant,
advisor, j
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