Exhibit 10.21
EXECUTION COPY
UNIT AWARD AGREEMENT
     This Unit Award Agreement (this “Agreement”), is made effective as of
October 5, 2007, (hereinafter referred to as the “Date of Grant”), between
Tishman Speyer Archstone-Smith Multifamily Parallel Guarantor I, L.L.C., a
limited liability company organized under the laws of the State of Delaware (the
“Company”), and R. Scott Sellers (“Sellers”). Capitalized terms not defined in
this Agreement shall have the meaning given to them in the Limited Liability
Company Agreement of the Company, dated as of October 5, 2007 (the “LP
Agreement”).
R E C I T A L S:
     WHEREAS, Sellers is employed by Archstone-Smith Communities L.L.C. or any
of its affiliates (the “Employer”) and, through such employment, provides
services to the Company and its affiliates;
     WHEREAS, the Board of Directors of Tishman Speyer U.S. Value Added
Associates VII, L.L.C. (the “Board”), which is the general partner of Tishman
Speyer Real Estate Venture VII Parallel (Governance), L.P., which in turn is the
general partner of Tishman Speyer Archstone-Smith Multifamily Parallel (GP),
L.P., which in turn is the general partner of Tishman Speyer Archstone-Smith
Multifamily Parallel Fund I JV, L.P., the managing member of the Company has
determined that it would be in the best interests of the Company and its
affiliates to make the award of Class B Units provided for herein to Sellers
pursuant to the terms set forth herein.
     NOW THEREFORE, in consideration of the mutual covenants hereinafter set
forth, the parties hereto agree as follows:
     1. Award of Class B Units.
          (a) Class B Units. Subject to the terms and conditions of this
Agreement, the Company hereby grants to Sellers an award of 100 Class B Units of
the Company (such 100 units, hereinafter called the “Class B Units”). The
Class B Units shall vest in accordance with Section 2 of this Agreement.
          (b) Adjustment.
               (i) In the event that there shall be any sale or other
extraordinary distribution (whether in the form of cash, membership units of the
Company or other property), recapitalization, split or reverse split of equity,
reorganization, merger, consolidation, spin-off, combination, repurchase, or
unit exchange, or other similar transaction or event affecting the Class B
Units, the Board shall cause to be made such equitable adjustments as it, in
good faith, deems necessary or appropriate to the number and kind of units
issued pursuant to this Agreement to prevent inappropriate dilution or
enlargement of the economic interest represented by such units.

 

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               (ii) In the event that securities of the Company are redeemed in
connection with the establishment of a new Affiliate or Affiliates, the Company
may cancel all or a portion of such Class B Units and issue or cause to be
issued to Sellers economically equivalent equity interests in such new
Affiliate(s) (a “Reapportionment”), containing terms and conditions that are no
less favorable than the terms and conditions set forth herein (including, but
not limited to, vesting conditions), to appropriately apportion the incentive
compensation element of the Class B Units amongst such Affiliate(s). In the
event that a Reapportionment results in any negative impact on Sellers
(including, without limitation, any adverse tax impact such as the loss of
long-term capital gains treatment, the inclusion of income on the date of such
Reapportionment or the loss of basis), the Company shall indemnify and hold
Sellers harmless with respect to all economic loss associated with the transfer
of the interests and shall gross-up all such payments so that the
indemnification is tax neutral to Sellers; provided, however, that Sellers shall
cooperate with the Company to minimize the extent of any adverse tax impact to
the extent permissible under applicable law.
     2. Vesting. Subject to Sellers’s continued employment with the Employer,
the Class B Units will vest and become non-forfeitable (such non-forfeitable
Class B Units, the “Vested Units,” and Class B Units prior to becoming Vested
Units, “Unvested Units”) on the three-year anniversary of the Date of Grant;
provided, however, that all Class B Units shall become Vested Units upon the
earlier to occur of (i) a termination of Sellers’s employment with the Employer
by the Employer without “Cause” or by Sellers for “Good Reason” (each as defined
in, and in accordance with the terms and conditions of, the employment agreement
by and between Sellers and Archstone-Smith Communities L.L.C., dated as of
October 5, 2007 (the “Employment Agreement”)) and (ii) the date on which there
is a liquidation or dissolution of the Company if and only if the Unvested Units
effectively lose any portion of their value in connection with such liquidation
or dissolution and such lost value is not replaced upon or promptly following
such liquidation or dissolution through the grant to Sellers of economically
equivalent units or interests in an Affiliate (without any negative impact to
Sellers associated with such replacement). Any Class B Units which remain
Unvested Units after the application of the preceding sentence shall be
forfeited upon a termination of Sellers’s employment with the Employer.
     3. Distributions.
          (a) Vested Units. Distributions in respect of Vested Units shall be
made to Sellers in accordance with the provisions of Section 14 of the LP
Agreement.
          (b) Unvested Units. Sellers shall not be entitled to any distributions
in respect of Unvested Units until and unless such Unvested Units have become
Vested Units. Any amounts which would have been distributed to Sellers pursuant
to the terms of the LP Agreement in respect of Unvested Units but for the
application of the preceding sentence (the “Unvested Allocations”) shall be
distributed to Sellers as soon as practicable after such Class B Units become
Vested Units, without interest. The Company shall set aside all Unvested
Allocations until such time as the Unvested Allocations are either forfeited
pursuant to Section 2 above or distributed pursuant to this Section 3(b) as
provided for in Section 14 of the LP Agreement.

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     4. Rights as Holder of Class B Units. Sellers shall be the record owner of
the Class B Units unless and until such Class B Units are forfeited pursuant to
Section 2 hereof or transferred in accordance with Section 6 hereof and, except
as provided in this Agreement, as record owner shall be entitled to all rights
of a holder of Class B Units of the Company; provided, that the Class B Units
shall be subject to the limitations on transfer and encumbrance set forth in
this Agreement and the LP Agreement.
     5. Representations in the LP Agreement; Purchase for Investment; Other
Representations of Sellers.
          (a) Representations in LP Agreement. Sellers hereby represents and
warrants that all representations and warranties made by Sellers in the LP
Agreement are true and correct.
          (b) Investment Intent. Sellers hereby represents and warrants that the
Class B Units are being acquired for investment and not with a view to
distribution thereof, and to make such other reasonable and customary
representations regarding matters relevant to compliance with applicable
securities laws as are deemed necessary by counsel to the Company.
          (c) Other Representations. Sellers hereby represents and warrants to
the Company as follows:
               (i) Access to Information. Because of Sellers’s business
relationship with the Company and with the management of the Company, Sellers
has had access to all material and relevant information concerning the Company,
thereby enabling Sellers to make an informed investment decision with respect to
his investment in the Company, and all pertinent data and information requested
by Sellers from the Company or its representatives concerning the business and
financial condition of the Company and the terms and conditions of this
Agreement have been furnished to Sellers. Sellers acknowledges that he has had
the opportunity to ask questions of and receive answers and obtain additional
information from the Company and its representatives concerning the present and
proposed business and financial conditions of the Company.
               (ii) Financial Sophistication. Sellers has such knowledge and
experience in financial and business matters that Sellers is capable of
evaluating the merits and risks of investing in the Class B Units.
               (iii) Understanding the Investment Risks. Sellers understands
that:
          (A) An investment in the Class B Units represents a highly speculative
investment, and there can be no assurance as to the success of the Company in
its business;
                    (B) There is at present no market for the Class B Units and
there can be no assurance that a market will develop in the future;
                    (C) The Class B Units may be worthless; and

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                    (D) Ownership of the Class B Units may result in taxable
income to Sellers without a corresponding cash or in-kind distribution.
          (iv) Understanding the Nature of the Class B Units. Sellers
understands and agrees that:
               (A) There can be no assurance that the Class B Units will be
registered under the Securities Act of 1933, as amended (the “Securities Act”),
or any applicable state securities laws and, if they are not so registered, they
will only be issued and sold in reliance upon certain exemptions contained in
the Securities Act and applicable state securities laws, and the representations
and warranties of Sellers contained herein are essential to any claim of
exemption by the Company under the Securities Act and such state laws;
               (B) If the Class B Units are not so registered, the Class B Units
will be “restricted securities” as that term is defined in Rule 144 promulgated
under the Securities Act;
               (C) Sellers may not sell, transfer, assign, pledge or otherwise
dispose of or encumber the Class B Units without registration under the
Securities Act and applicable state securities laws unless the Company receives
an option of counsel acceptable to it (as to both counsel and the opinion) that
such registration is not required;
               (D) Only the Company can register the Class B Units under the
Securities Act and applicable state securities laws;
               (E) The Company has not made any representations to Sellers that
the Company will register the Class B Units under the Securities Act or any
applicable state securities laws, or with respect to compliance with any
exemption therefrom;
               (F) Sellers is aware of the conditions for his obtaining an
exemption from the sale or transfer of the Class B Units under the Securities
Act and any applicable state securities laws; and
               (G) The Company may, from time to time, make stop transfer
notations in its transfer record to ensure compliance with the Securities Act
and any applicable state securities laws, and any additional restrictions
imposed by state securities administrators.
          (v) Investment Intent. Sellers acknowledges that:
               (A) Neither Sellers nor anyone acting on his behalf has paid or
will pay a commission or other remuneration to any person in connection with the
acquisition of the Class B Units; and

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               (B) At the time and as a condition of delivery of documents
evidencing the Class B Units, Sellers will be deemed to have made all the
representations and warranties contained in this Section 5 with respect to such
Class B Units and may be required to make other representations concerning
investment intent as condition of the delivery of such Class B Units by the
Company.
     6. Restriction on Transfer/LP Agreement. Unvested Units may not be
transferred, pledged, assigned, hypothecated or otherwise disposed of in any way
by Sellers. Vested Units may not be transferred, pledged, assigned, hypothecated
or otherwise disposed of in any way by Sellers, except (a) if and as permitted
by the LP Agreement, (b) by will or the laws of descent and distribution, (c) to
or for the benefit of any spouse, child or grandchild of Sellers, or to a trust
or partnership for the benefit of any of the foregoing individuals, or (d) if
and as permitted by the Board. The Class B Units shall not be subject to
execution, attachment or similar process. Any attempted assignment, transfer,
pledge, hypothecation or other disposition of the Class B Units contrary to the
provisions of this Agreement or the LP Agreement shall be null and void and
without effect.
     7. Designation of Beneficiary. Sellers may appoint any individual or legal
entity in writing as his beneficiary to receive any Class B Unit (to the extent
not previously terminated or forfeited) under this Agreement upon Sellers’s
death or Disability (as defined in the Employment Agreement). Sellers may revoke
his designation of a beneficiary at any time and appoint a new beneficiary in
writing. To be effective, Sellers must complete the designation of a beneficiary
or revocation of a beneficiary by written notice to the Company under Section 8
of this Agreement before the date of Sellers’s death. In the absence of a
beneficiary designation, the legal representative of Sellers’s estate shall be
deemed the beneficiary. Notwithstanding the foregoing, in the event that any
beneficiary appointed by Sellers (or deemed to be as such pursuant to the
preceding sentence) does not expressly become party to the LP Agreement and
expressly assume all restrictions on the Class B Units to which Sellers was
subject at the time of his death or Disability, such appointment (and any
purported transfer of Class B Units thereunder) shall be null and void and
without effect.
     8. Notices. Any notice necessary under this Agreement shall be addressed to
the Company at the principal executive office of the Employer and to Sellers at
the address appearing in the personnel records of the Employer for Sellers or to
either party at such other address as either party hereto may hereafter
designate in writing to the other. Any such notice shall be deemed effective
upon receipt thereof by the addressee.
     9. Tax Withholding. The Company and Sellers acknowledge and agree that
Sellers is an employee of the Company for all purposes hereunder, including,
without limitation, for purposes of calculating the Company’s withholding tax
obligations in connection with any Class B Units becoming Vested Units. The
Company shall reasonably determine the amount of any Federal, state, local or
other income, employment, or other taxes which the Company or any of its
subsidiaries or affiliates may reasonably be obligated to withhold (giving
effect to the immediately preceding sentence) with respect to the grant, vesting
or other event with respect to the Class B Units. In connection with any Class B
Units becoming Vested Units, the Company shall withhold from delivery to Sellers
a number of Class B Units that are otherwise becoming

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Vested Units having a fair market value equal to the taxes payable by Sellers in
connection with such vesting; provided, however, that the foregoing shall only
apply as to any amounts in excess of the minimum withholding required by
applicable law (after giving effect to the first sentence of this Section 9)
only to the extent such withholding would not result in accounting charges to
the Company or any of its affiliates in excess of the accounting charges which
would have applied in the absence of such withholding.
     10. Choice of Law; Forum. This Agreement will be governed by and construed
in accordance with the laws of the State of Delaware, without giving effect to
any choice of law or conflicting provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the laws of any
jurisdiction other than the State of Delaware to be applied. In furtherance of
the foregoing, the internal law of the State of Delaware will control the
interpretation and construction of this Agreement, even if under such
jurisdiction’s choice of law or conflict of law analysis, the substantive law of
some other jurisdiction would ordinarily apply. Any proceeding arising out of or
relating to this Agreement shall be adjudicated in accordance with the
procedures described in Section 11(g) of the Employment Agreement.
     11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT
OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION.
     12. Class B Units Subject to LP Agreement. By entering into this Agreement
Sellers agrees and acknowledges that (i) Sellers has received and read a copy of
the LP Agreement and (ii) the Class B Units are subject to the LP Agreement, the
terms and provisions of which are hereby incorporated herein by reference. In
the event of a conflict between any term or provision contained herein and a
term or provision of the LP Agreement, the applicable terms and provisions of
this Agreement will govern and prevail. The grant of Class B Units pursuant to
this Agreement shall not restrict in any way the adoption of any amendment to
the LP Agreement in accordance with the terms of such agreement. Notwithstanding
anything herein to the contrary, the grant of Class B Units pursuant to this
Agreement is subject to Sellers taking actions required by the Company to become
a party to the LP Agreement.
     13. No Right to Continued Service. This Agreement shall not be construed as
giving Sellers the right to be retained in the employ of, or in any other
continuing relationship with, the Employer or any of its affiliates.

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     14. Cooperation. The parties shall cooperate to resolve any disputes as to
the interpretation of this Agreement and the dispute resolution mechanisms set
forth in Section 11(g) of the Employment Agreement shall remain applicable.
     15. No Limit on Other Compensation Arrangements. Nothing contained in this
Agreement shall prevent the Company, the Employer or any of their affiliates
from adopting or continuing in effect other compensation arrangements, which
may, but need not, provide for the award of Class B Units, securities and other
types of awards, and such arrangements may be either generally applicable or
applicable only in specific cases.
     16. Amendments. The provisions of this Agreement may not be amended,
modified or supplemented unless consented to in writing by the Company and
Sellers.
     17. Signature in Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement.

     
/s/ R. Scott Sellers
 
R. Scott Sellers
   

          TISHMAN SPEYER ARCHSTONE-SMITH
MULTIFAMILY PARALLEL GUARANTOR I, L.L.C.    
 
       
 
  /s/ Michael B. Benner
 
   
By:
  Michael B. Benner    
Title:
  Authorized Signatory    

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