EXHIBIT 99.4
SEPARATION AGREEMENT AND MUTUAL GENERAL RELEASE
This SEPARATION AGREEMENT AND MUTUAL GENERAL RELEASE (this "Agreement")
dated as of April 28, 2005 (the "Effective Date") between Xxxx X. Xxxxx
("Executive") and American Campus Communities, Inc. (the "Company").
WHEREAS, the Company and Executive have entered into an Employment
Agreement dated as of August 11, 2004 (the "Employment Agreement");
WHEREAS, the Company and Executive have entered into a Confidentiality
and Noncompetition Agreement dated as of August 11, 2004 (the "Noncompete
Agreement");
WHEREAS, the Company and Executive have entered into an Indemnification
Agreement dated as of August 17, 2004 (the "Indemnification Agreement");
WHEREAS, Executive shall resign as an officer and director of the
Company and all of its affiliates as of May 16, 2005 (the "Officer Resignation
Date") and Executive shall resign as an employee of the Company and all of its
affiliates effective as of June 30, 2005 (the "Termination Date");
WHEREAS, the parties agree that Executive's resignation from employment
with the Company and all of its affiliates is the result of a mutual agreement
between Executive and the Company; and
WHEREAS, Executive and the Company have agreed to provide each other
with a general release of claims as contained herein.
NOW, THEREFORE, Executive and the Company agree to enter into this
Agreement setting forth their respective obligations related to Executive's
separation as follows:
1. Separation of Employment. Effective as of the Officer Resignation
Date, Executive will resign as an officer, director, manager or similar
functionary of all entities related to the Company and as a member of any
committee relating to the Company, and effective as of June 30, 2005, Executive
will resign as an employee of the Company and all entities related to the
Company. From the Effective Date until the Termination Date, Executive will
continue to receive from the Company the salary and benefits he was entitled to
receive as of the Effective Date, including without limitation any dividends or
other payments that may be due to him as a result of his ownership of any PIUs
or any restricted shares of the Company's common stock. From the Officer
Resignation Date until the Termination Date, (i) Executive shall, as requested
by the Company's chief executive officer, provide assistance to the Company in
completing a transition of his duties, and (ii) may use a reasonable portion of
his business time, attention, skill and best efforts for personal matters
unrelated to Company business. The parties acknowledge and agree that, unless
expressly provided for herein, their obligations to each other under the
Employment Agreement shall cease as of the Termination Date.
2. Special Compensation and Benefits. In consideration for the
promises, covenants, agreements and releases set forth herein, the Company
agrees to provide Executive with the following compensation and benefits
("Special Compensation and Benefits"):
(a) Within five business days of the Termination Date, the
Company will pay to Executive (i) all accrued and unpaid Base Salary, (ii) any
earned but unpaid holiday, vacation or paid time off and (iii) any expenses
incurred in accordance with Section 7 of the Employment Agreement that remain
unpaid or unreimbursed as of the Termination Date (in accordance with the
Company's current reimbursement policy);
(b) The Company will pay to Executive an aggregate of
$350,000 in 12 equal monthly installments commencing on July 15, 2005, with the
remaining payments to be made on the 15th of each month thereafter (or, if such
date is not a business day, the following business day) until the total amount
has been paid. Executive may, at his option, elect to take any or all of the
remaining payments due pursuant to this provision as a lump sum payment, payable
within 30 days of Executive's election to take a lump sum and discounted by 4%
to reflect the present value of such lump sum;
(c) The Company will pay to Executive an amount equal to the
difference between the amount paid by Executive for health insurance coverage
under the Company's health benefit plan immediately prior to the Termination
Date and the cost of either (i) continuation coverage under COBRA or (ii) upon
the expiration of Executive's COBRA rights, the cost of other continuation
coverage providing a comparable level of benefits, payable on a monthly basis
for the period ending on the second anniversary of the Termination Date;
provided that if prior to the second anniversary of the Termination Date,
Executive is eligible to receive health insurance benefits from a subsequent
employer, payments under this Section 2(c) shall cease as of the date Executive
becomes eligible;
(d) Executive shall retain his 12,100 PIUs, all of which are
vested. Executive acknowledges and agrees that Executive shall, as of the
Termination Date, forfeit any and all portions of any award, unvested as of the
Termination Date, made to Executive by the Company or its affiliates under or
pursuant to any retirement, pension, profit sharing, long-term incentive, equity
or similar plan, including but not limited to the Outperformance Bonus Program
and the Plan; and
(e) The Company shall, within 30 days of the execution of
this Agreement, reimburse Executive for reasonable attorneys' fees incurred by
Executive in the review and analysis of this Agreement.
3. General Release by Executive. In return for the Special
Compensation and Benefits referenced in this Agreement, as well as the mutual
promises, covenants, agreements and releases set forth herein, Executive agrees
to the following:
(a) Except as set forth in Section 3(c), Executive agrees,
on behalf of himself and anyone claiming through him or on his behalf, to
release the Company and all of its subsidiaries, affiliates, predecessors and
successors, and all of their present or former officers, directors, managers,
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representatives, employees, agents, employee benefit programs, and the trustees,
administrators, fiduciaries and insurers of such programs (collectively, the
"Company Released Parties"), from any and all claims for relief of any kind,
whether known to Executive or unknown, which in any way arise out of or relate
to Executive's employment at the Company or any of the other Company Released
Parties, the resignation of his employment at the Company or any of the other
Company Released Parties, any agreements between the Company or any of the other
Company Released Parties and Executive, including but not limited to the
Employment Agreement, and concerning events occurring at any time up to the
Termination Date, including, but not limited to, any and all claims of
discrimination of any kind, and any contractual, tort or other common law
claims. This release includes all such claims, whether for breach of contract,
quasi-contract, implied contract, quantum meruit, unjust enrichment,
compensation, deferred compensation, equity interest, any tort claims, any and
all claims under any applicable federal laws, including, but not limited to, the
Age Discrimination in Employment Act, as amended, Title VII of the Civil Rights
Act of 1964, as amended, the Civil Rights Act of 1991, 42 U.S.C. ss. 1981, the
Americans with Disabilities Act, as amended, the Equal Pay Act, as amended, the
Worker Adjustment and Retraining Notification Act, the Employee Retirement
Income Security Act of 1974, as amended, the Family and Medical Leave Act, as
amended, the Fair Labor Standards Act, as amended, the Xxxxxxxx-Xxxxx Act, or
under any applicable state or local laws or ordinances or any other legal
restrictions on the Company's rights, including the Texas Commission on Human
Rights Act and Section 451 of the Texas Labor Code.
(b) Except as set forth in Section 3(c), Executive further
agrees not to file a suit of any kind against the Company or any of the other
Company Released Parties relating to any of the claims or causes of action
released by this Agreement. Even if a court rules that Executive may file a
lawsuit against the Company or any of the other Company Released Parties arising
any of the claims or causes of action released by this Agreement, Executive
agrees not to accept any money damages or any other relief in connection with
any such lawsuit. Executive understands that this Agreement effectively waives
any right he might have to xxx the Company or any of the other Company Released
Parties for any of the claims or causes of action released by this Agreement,
except as set forth in Section 3(c).
(c) Notwithstanding the generality of the foregoing, nothing
contained herein shall release the Company or the other Company Released Parties
from any claim relating to (i) any breach by the Company of this Agreement, (ii)
Executive's rights, if any, to COBRA benefits under the Company's standard
benefit programs applicable to Executive, (iii) Executive's rights to vested
equity interests or PIUs, vested 401(k) or pension monies under any applicable
Company benefit plan, or (iv) Executive's rights to indemnification under the
Indemnification Agreement, the Company's articles of incorporation or bylaws, or
any applicable statute.
4. General Release by the Company. In return for the mutual promises,
covenants, agreements and releases set forth herein, the Company agrees to the
following:
(a) Except as set forth in Section 4(c), the Company agrees,
on behalf of itself and all of its parent companies, subsidiaries, affiliates,
predecessors and successors, to release Executive and his heirs or personal
representatives (collectively the "Executive Released Parties"), from any and
all claims for relief of any kind, whether known to it or unknown, which in any
way arise out of or relate to Executive's employment at the Company any of the
other Company Released Parties, the resignation of Executive's employment at the
Company or any of the other Company Released Parties, or any agreements between
the Company or any of the other Company Released Parties and Executive,
including but not limited to the Employment Agreement, and concerning events
occurring at any time up to the Termination Date.
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(b) Except as set forth in the last paragraph of this
Section 4, the Company further agrees not to file a suit of any kind against
Executive or any of the other Executive Released Parties relating to any of the
claims or causes of action released by this Agreement. Even if a court rules
that the Company may file a lawsuit against Executive or any of the other
Executive Released Parties arising from any of the claims or causes of action
released by this Agreement, the Company agrees not to accept any money damages
or any other relief in connection with any such lawsuit. The Company understands
that this Agreement effectively waives any right it might have to xxx Executive
or any of the other Executive Released Parties for any of the claims or causes
of action released by this Agreement, except as set forth in Section 4(c).
(c) Notwithstanding the generality of the foregoing, nothing
contained herein shall release the Executive or the other Executive Released
Parties from any claim relating to (i) any breach by Executive of this
Agreement, (ii) any breach by Executive of his continuing obligations under the
Noncompete Agreement, as expressly set forth in Section 5(b) of this Agreement,
or (iii) Executive's fraud, willful misconduct, gross negligence or illegal act.
5. Restrictive Covenants and Miscellaneous Provisions.
(a) Executive confirms that, while he understands that he
has had such an obligation since he began his employment with the Company or any
of the other Company Released Parties, he shall not disclose any of the trade
secrets or other Confidential Information (as defined in the Noncompete
Agreement) of the Company or any of the other Company Released Parties and shall
not make use of such trade secrets or Confidential Information in any fashion at
any time, including in any future employment.
(b) Executive agrees that for one year following the
Termination Date, Executive will comply with the provisions of Sections 4
(Non-Competition) and 5 (Non-Solicitation; Non-Interference) of the Noncompete
Agreement. Executive acknowledges and agrees that he will, at all times
following the Termination Date, comply with all other post-employment
obligations contained in the Noncompete Agreement. Notwithstanding the
foregoing, Executive shall not be prohibited from soliciting, recruiting or
hiring Xxxxxx Xxxxxx.
(c) Executive understands and agrees that the Company shall
have the right to and may xxx him for breach of contract if he violates the
provisions of the Noncompete Agreement or this Agreement. Executive further
acknowledges that but for his agreements to comply with this Agreement and the
Noncompete Agreement, the Company would not provide him with the Special
Compensation and Benefits set forth in Section 2.
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(d) Executive agrees that on or before the Termination Date
he will return to the Company all of the Company's property in his possession,
including, but not limited to, company files, work product, computer equipment,
computer software, cell phones, pagers, corporate credit cards, identification
cards, manuals, company documents and company keys.
(e) This Agreement does not constitute an admission of any
kind by the Company or by Executive.
(f) Executive agrees not to make any statements that
disparage the reputation of the Company or any of the other Company Released
Parties, or their properties or services. Executive agrees that any breach or
violation of this non-disparagement provision shall entitle the Company to xxx
him on this Agreement for the immediate recovery of any damages caused by such
breach.
(g) The Company agrees not to make any statements that
disparage the reputation of Executive. The Company agrees that any breach or
violation of this non-disparagement provision shall entitle Executive to xxx the
Company on this Agreement for the immediate recovery of any damages caused by
such breach.
(h) All payments and benefits under this Agreement are gross
amounts and will be subject to taxes and lawful deductions, if any.
(i) The venue for the litigation of any dispute arising out
of this Agreement shall be a court of competent jurisdiction in Xxxxxx County,
Texas. If either party files a lawsuit in state court arising out of this
Agreement, the other party may remove the lawsuit to federal court to the extent
jurisdiction exists. Texas law shall govern the interpretation and enforcement
of this Agreement
(j) The Company acknowledges and agrees that nothing in this
Agreement shall be modify Executive's rights or the Company's obligations under
the Indemnification Agreement, including without limitation the Company's
obligation to use reasonable best efforts to acquire directors and officers
liability insurance covering Executive or any claim made against Executive for
his service as an officer or director of the Company.
(k) Capitalized terms used herein and not otherwise defined
shall the meanings assigned to such terms in the Employment Agreement.
(l) Executive is entering into this Agreement freely and
voluntarily. Executive has carefully read and understand all of the provisions
of this Agreement. Executive understands that it sets forth the entire agreement
between him and Company and Executive represent that no other statements,
promises, or commitments of any kind, written or oral, have been made to him by
the Company, or any of its agents, to cause him to accept it. Executive
acknowledges that he has been advised to consult legal counsel concerning this
Agreement prior to signing the Agreement, and that he has had sufficient
opportunity to do so. Executive understands that he may have up to 21 days from
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the date of this Agreement to consider this Agreement. Executive understand that
if he signs this Agreement, he will then have seven days to cancel it if he so
chooses. Executive may cancel this Agreement by delivering a written notice of
cancellation to Xxxxxxx X. Xxxxxxx Xx. at American Campus Communities, Inc., 000
Xxx Xxxxx Xxxx., Xxxxx 000, Xxxxxx, XX 00000. However, if Executive elects to
cancel this Agreement, he understands that he will not be entitled to any of the
benefits, compensation, or other consideration referenced in this Agreement.
Executive realizes this Agreement is not effective or enforceable until the
seven-day period expires without revocation. Executive understands that this
Agreement will not become effective until the eighth day after he signs the
Agreement without revocation. Executive understands that the Company will have
no duty to pay Executive or provide him with the compensation and benefits
listed in Section 2 until the eighth day after he signs the Agreement without
revocation.
[Signature page follows]
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date written below.
AMERICAN CAMPUS COMMUNITIES, INC.
Date: April 28, 2005 By:
/s/ Xxxxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxx, Xx.
President and Chief Executive Officer
EXECUTIVE
Date: April 28, 2005 /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
[Signature page to Separation Agreement and Mutual Release]
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