Exhibit 10.1
SETTLEMENT AGREEMENT AND GENERAL RELEASE
WHEREAS, the parties to this Settlement Agreement and General Release
have been involved in lawsuits in the United States District Court for the
Middle District of Pennsylvania at No. 3:CV-95-1935, captioned Xxxx Xxxxxxxxxx,
Xx. v. Xxxx Centers Trust, et al. and in the Court of Common Pleas of Luzerne
County, Pennsylvania at No. 6437-C of 1994, captioned Xxxxxxxxxx v. Xxxx Centers
Trust, et al., (the "Lawsuits");
WHEREAS, the parties to this Settlement Agreement and General Release,
without admitting any liability or fault and in order to avoid the expense and
inconvenience of further litigation, desire to settle the Lawsuits and all other
possible claims, whether related to the Lawsuits or not;
NOW, THEREFORE, on this 31st day of December, 1998, for the mutual
promises and consideration contained herein, and for other good and valuable
consideration, receipt of which is hereby acknowledged, and intending to be
legally bound, the parties agree as follows:
1. Acadia Realty Trust, formerly known as Xxxx Centers Trust, shall pay
to Xxxx Xxxxxxxxxx, Xx. (i) $1,000,000 on or before December 31, 1998, (ii)
$900,000 on or before April 1, 1999, and (iii) five payments of $200,000 each on
or before January 10, 2000, January 10, 2001, January 10, 2002, January 10,
2003, and January 10, 2004 respectively. Payment shall be made by wire transfer
sent to Comerica Bank - Texas, Dallas, Texas, ABA #000000000 for credit to Xxxx
Xxxxxxxxxx, Xx., Account No. 7833028512, Attention: Xxxxxxx X. Xxxxxxx, Vice
President or to such other accont as Xxxxxxxxxx may from time to time designate
in writing.
2. Acadia Realty Trust also agrees to defend, indemnify, and hold
harmless Xxxxxxxxxx from and for any loss or liability resulting from claims
threatened or brought against Xxxxxxxxxx based on (i) any act or omission
committed by Xxxxxxxxxx related to his employment with Xxxx Centers Trust or
term on the Board of Trustees or (ii) relating to any claims referenced in the
Lawsuits, including but not limited to claims for abuse of process, malicious
prosecution, wrongful use of civil proceedings, or shareholder derivative claims
or governmental proceedings.
3. If any of the payments due under this Agreement is not received by
Xxxxxxxxxx on or before its respective due date, then Xxxxxxxxxx may, at his
option, deliver notice of nonpayment to Acadia Realty Trust as set forth in
paragraph 4 below. If the missed payment is not received within three (3)
business days following the date on which the notice of nonpayment is received
by Acadia, then every installment not yet paid shall be accelerated and shall
become immediately due and payable and counsel for Xxxxxxxxxx may appear for
Acadia and have the Prothonotary of the Court of Common Pleas of Luzerne County,
Pennsylvania enter judgment by confession against Acadia.
THIS PARAGRAPH SETS FORTH A WARRANT OF AUTHORITY FOR AN ATTORNEY TO
CONFESS JUDGMENT AGAINST ACADIA REALTY TRUST. IN GRANTING THIS WARRANT OF
AUTHORITY TO CONFESS JUDGMENT AGAINST ACADIA REALTY TRUST, ACADIA REALTY TRUST
HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, AND, ON THE ADVICE OF THE
SEPARATE COUNSEL OF ACADIA REALTY TRUST, UNCONDITIONALLY WAIVES ANY AND ALL
RIGHTS ACADIA REALTY TRUST
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HAS OR MAY HAVE TO PRIOR NOTICE AND AN OPPORTUNITY FOR HEARING UNDER THE
RESPECTIVE CONSTITUTIONS AND LAWS OF THE UNITED STATES AND THE COMMONWEALTH OF
PENNSYLVANIA.
Upon the occurrence of a default of this Agreement and Acadia Realty
Trust's failure to cure such Default after notice, Acadia hereby irrevocably
authorizes and empowers any attorney of any Court of record in the Commonwealth
of Pennsylvania to appear for and to enter and confess judgment against Acadia
Realty Trust, at any time or times and as of any term, for the principal amount
of this Agreement, with or without declaration and without stay of execution,
together with interest and costs including reasonable actual attorney's fees.
The authority granted to Xxxxxxxxxx to confess judgment shall not be exhausted
by one exercise but shall continue until Acadia Realty Trust has paid all sums
required to be paid by Acadia Realty Trust under this Agreement.
4. Notices of nonpayment shall be sent by facsimile transmission and by
a national overnight courier, such as UPS or Federal Express, to Xxxxxxx X.
Xxxxxxxxx, Acadia Realty Trust, 000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, XX 00000,
fax no. (000) 000-0000 and Xxxxxx Xxxxxxx, Esquire, Acadia Realty Trust, 00
Xxxxxxxxx Xxxxxxxxxxx, Xxxx Xxxxxxxxxx, XX 00000, fax no. (000) 000-0000. Acadia
will notify Xxxxxxxxxx in writing of any change in the persons to whom or
addresses to which notices of nonpayment are to be sent. Such notice from Acadia
shall be sent by facsimile transmission and national overnight carrier to
Xxxxxxxxxx at 0000 Xxxxxx Xxxxxx, Xxxxxx, Xxxxx 00000, fax no. (000) 000-0000
and Xxxxxxx Xxxxxxxxxxx, Esquire, Koff, Wendolowski, Xxxxxxxx & Xxxxxx, P.C., 00
Xxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxxxx-Xxxxx, Xxxxxxxxxxxx 00000, fax no. (570)
000-0000.
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5. Simultaneously with execution of this Agreement, Acadia shall
establish an escrow fund in the amount of $1,000,000 with Battle Xxxxxx LLP as
escrow agent. The escrow fund will collateralize Acadia's obligation to make the
$900,000 payment on April 1, 1999 and the five $200,000 payments and will be
released upon presentation to Xxxxxxxxxx of a mutually acceptable standby
irrevocable letter of credit to secure the payments that have not yet been made
at the time the letter of credit is provided. The irrevocable letter of credit
shall either have a termination date, or be renewable for a period, coextensive
with the payment obligations hereunder and shall specify a draw down procedure
identical to the payment procedure set forth in Paragraph 4 and Schedule A of
the Escrow Agreement attached hereto as Exhibit A. Additional terms applicable
to the escrow fund are set forth in the Escrow Agreement attached hereto as
Exhibit A. The irrevocable letter of credit shall be obtained from a domestic
commercial bank with a deposit base of at least $500 million. Xxxxxxxxxx shall
pay the costs or fees associated with obtaining the irrevocable letter of credit
up to a maximum of 1.5% of the amount of the letter of credit. In the event that
the costs or fees associated with obtaining the letter of credit exceed 1.5% of
the letter of credit amount, then Acadia will pay the excess costs or fees if it
still intends to provide a letter of credit. Upon request of Acadia, Xxxxxxxxxx
agrees to provide to Escrow Agent a written acknowledgment of receipt of the
mutually agreeable irrevocable letter of credit.
6. In the event of a change in control at Acadia, then every
installment not yet paid under this Agreement shall be accelerated and shall
become immediately due and payable. For purposes of this Agreement, change in
control means the sale or disposition of a majority of Acadia's outstanding
capital stock, property, assets or business; or a third
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person including a "group" as used in Section 13(d)(3) of the Securities
Exchange Act of 1934 (the "Exchange Act"), becomes the beneficial owner,
directly or indirectly, of 51% or more of the combined voting power of Acadia's
outstanding voting securities; or the consolidation of Acadia with or merger
into any other entity on a basis whereby Acadia is not the surviving entity; or
the consolidation of Acadia as a result of an unaffiliated entity being reverse
merged into Acadia whereby control is changed pursuant to the definitions of
this paragraph.
7. Xxxxxxxxxx hereby releases and discharges Acadia Realty Trust (f/k/a
Xxxx Centers Trust), Xxxxxx X. Xxxxxxxxx, Xxxxxx Corporation, Xxxxxxxx Xxxxxx,
Xxxxxxxxx Denmark, Xxxxxx Xxxxxx, Xxxxxx Xxxxxx XX, Xxxx Xxxxxxx Xxxxx, Xxxxxx
Xxxxxx, Xxxxxx Xxxxxxxxx, and Xxxxxx Xxxx (collectively, "Defendants") and each
of their past, present, and future employees, representatives, attorneys,
agents, predecessors, subsidiaries, divisions, affiliates, directors, officers,
shareholders, successors, and assigns, from all claims or causes of action --
known or unknown, suspected or unsuspected, and whether involved in the Lawsuits
or not, and including but not limited to all claims for attorneys' fees and
costs -- which against Defendants he ever had, now has or hereafter may have,
arising out of or based on any event from the beginning of the world to the date
of this Settlement Agreement and General Release.
8. Xxxxxxxxxx covenants, agrees, and represents that he has not and
will not file or otherwise initiate any type of proceeding with a governmental
agency based on the subject matter of the Lawsuits.
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9. Acadia Realty Trust, formerly known as Xxxx Centers Trust, and
Xxxxxx X. Xxxxxxxxx, in his individual capacity, hereby release and discharge
Xxxxxxxxxx and his representatives, agents, attorneys, successors, and assigns
from all claims or causes of action -- known or unknown, suspected or
unsuspected, and whether involved in the Lawsuits or not, and including, but not
limited to all claims for attorneys' fees and costs -- which against Xxxxxxxxxx
they ever had, now have or hereafter may have, arising out of or based on any
event from the beginning of the world to the date of this Settlement Agreement
and General Release. Acadia will use reasonable efforts to secure full and
complete general releases for Xxxxxxxxxx from each of the other Defendants.
10. While agreeing to compromise and settle this Lawsuit, the parties
deny liability to each other. It is understood and agreed that by entering into
this Settlement Agreement and General Release, the parties in no way admit any
liability to each other. Nothing in this Agreement shall constitute precedent or
evidence in another proceeding, with the exception that this Agreement shall be
admissible evidence in any proceeding to enforce the terms hereof.
11. Promptly upon execution of this Agreement, counsel for the parties
shall file with the Courts the documents necessary to obtain the dismissal of
the Lawsuits with prejudice.
12. Xxxxxxxxxx, on the one hand, and Acadia Realty Trust and Xxxxxxxxx,
on the other, each agree that they will not make disparaging remarks about the
other or publicize any statements or opinions concerning Xxxxxxxxxx'x experience
as an officer of Xxxx Centers Trust.
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13. The terms of this Agreement inure to the benefit of, and are
binding upon the heirs, successors, and assigns of the parties hereto, and
Xxxxxxxxxx'x right to receive payments under this Agreement is assignable to
Xxxxxxxxxx'x successors, assigns, and heirs.
14. Xxxxxxxxxx acknowledges and agrees that he is liable for and will
pay all taxes for which he personally is responsible under federal and state law
as a result of the payments made to him under this Agreement. Xxxxxxxxxx shall
defend, indemnify, and hold harmless Acadia for any claim arising from
Xxxxxxxxxx'x failure to pay such taxes when due.
15. The prevailing party in any lawsuit alleging a breach of this
Agreement shall be entitled to recover the reasonable attorneys' fees and costs
incurred in connection with such a lawsuit.
16. The parties to this Agreement acknowledge that they have carefully
read this Settlement Agreement and General Release and have had it explained to
them by their attorneys. They warrant and represent that they relied upon their
own judgment and that of their legal counsel regarding the proper, sufficient,
and agreed-upon consideration for the terms and provisions of this Agreement and
that no statement or representation by the other parties or their agents,
employees, officers, directors, or legal representatives has influenced or
induced them to execute this Agreement.
17. Acadia's Board of Trustees has approved the terms of this Agreement
and has authorized Acadia to enter into this Agreement.
18. This Agreement contains the complete and final agreement between
the parties regarding the settlement and compromise of the Lawsuits. No
modification or other
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change to this Agreement shall be effective unless set forth in writing duly
executed by or on behalf of the parties.
19. This Agreement is to be governed by the laws of the Commonwealth of
Pennsylvania and any lawsuit alleging a breach of this Agreement shall be filed
in, and only in, the state or federal courts located in the Commonwealth of
Pennsylvania.
20. This Agreement may be executed in counterparts and facsimile
signatures shall have the same effect as original signatures.
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the
undersigned have hereunto set their hands on the date(s) indicated.
12/31/98 /s/ Xxxx Xxxxxxxxxx, Xx.
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DATE XXXX XXXXXXXXXX, XX.
ACADIA REALTY TRUST
12/30/98 By /s/ Xxxxxx Xxxxxxx
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DATE XXXXXX XXXXXXX
Senior Vice President
12/30/98 /s/ Xxxxxx X. Xxxxxxxxx
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DATE XXXXXX X. XXXXXXXXX
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