Exhibit 10.1

[IPO performance-based vesting - executives]

LONG TERM INCENTIVE PLAN UNIT

PERFORMANCE-BASED VESTING AGREEMENT

Under the American Residential Properties, Inc.

2012 Equity Incentive Plan

 

Name of Grantee:    Stephen G. Schmitz (the “Grantee”) Number of LTIP Units:   
142,857 Grant Date:    November 2, 2013 Final Acceptance Date:    November 11,
2013

Pursuant to the American Residential Properties, Inc. 2012 Equity Incentive Plan
(the “Plan”), as amended through the date hereof, and the Agreement of Limited
Partnership, dated as of May 11, 2012, as amended through the date hereof (the
“Partnership Agreement”), of American Residential Properties OP, L.P., a
Delaware limited partnership (“ARP OP”), American Residential Properties, Inc.,
a Maryland corporation (the “Company”) and the sole member of American
Residential GP, LLC, a Delaware limited liability company, the general partner
of ARP OP (the “General Partner”), and for the provision of services to or for
the benefit of ARP OP in a partner capacity or in anticipation of being a
partner, hereby grants to the Grantee an Other Equity-Based Award (as defined in
the Plan) (an “Award”) in the form of, and by causing ARP OP to issue to the
Grantee, the number of LTIP Units specified above (the “LTIP Units”) having the
rights, voting powers, restrictions, limitations as to distributions,
qualifications and terms and conditions of redemption and conversion set forth
herein and in the Partnership Agreement. Upon acceptance of this Long Term
Incentive Plan Unit Performance-Based Vesting Agreement (this “Agreement”), the
Grantee shall receive, effective as of the Closing Date, the number of LTIP
Units specified above, subject to the restrictions and conditions set forth
herein and in the Partnership Agreement. Capitalized terms used but not defined
herein have the meanings assigned to such terms in the Partnership Agreement,
attached hereto as Annex A, or the Plan, as applicable, unless a different
meaning is specified herein. Reference is made to that certain Amended and
Restated Employment Agreement entered into by and between the Company and the
Grantee effective as of April 19, 2013 (the “Employment Agreement”).

1. Acceptance of Agreement. The Grantee shall have no rights with respect to
this Agreement unless he or she shall have accepted this Agreement prior to the
close of business on the Final Acceptance Date specified above by (i) signing
and delivering to ARP OP a copy of this Agreement and (ii) unless the Grantee is
already a Limited Partner, signing, as a Limited Partner, and delivering to ARP
OP a counterpart signature page to the Partnership Agreement. Upon acceptance of
this Agreement by the Grantee, the Partnership Agreement shall be amended to
reflect the issuance to the Grantee of the LTIP Units so accepted, effective as
of the Grant Date. Thereupon, the Grantee shall have all the rights of a Limited
Partner with respect to the number of LTIP Units specified above, as set forth
in the Partnership Agreement, subject, however, to the restrictions and
conditions specified in Section 2 below.

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2. Restrictions and Conditions.

(a) The records of ARP OP evidencing the LTIP Units shall bear an appropriate
legend, as determined by ARP OP in its sole discretion, to the effect that such
LTIP Units are subject to restrictions as set forth herein and in the
Partnership Agreement.

(b) The LTIP Units may not be sold, transferred, pledged, exchanged,
hypothecated or otherwise disposed of by the Grantee prior to the time that they
Vest (as defined below).

(c) Any of the LTIP Units (and the proportionate amount of the Grantee’s Capital
Account balance attributable to such LTIP Units) that have not Vested on or
before the date that the Grantee’s employment with the Company and its
Affiliates (as defined in the Plan) terminates shall be forfeited as of the date
that such employment terminates.

3. Vesting of LTIP Units. As soon as practicable after the end of each
Measurement Period, but in all events within 30 days following each Measurement
Period, the Committee shall determine and certify the extent to which the
performance objectives described herein have been achieved. If the Committee
determines and certifies the same as described in the preceding sentence, the
restrictions and conditions in Sections 2(b) and 2(c) shall lapse with respect
to the LTIP Units (i.e., the LTIP Units shall “Vest” or become “Vested,” as the
case may be) as follows, provided that the Grantee remains employed by the
Company or an Affiliate from the Date of Grant until the end of the applicable
Measurement Period:

(a) Company TSR. Up to one-half of the LTIP Units shall: (A) Vest as of the end
of the applicable Measurement Period as provided in the following paragraphs
(i), (ii), (iii), (iv) and (v); and (B) be forfeited as of May 14, 2018 if not
Vested on or before May 14, 2018.

(i) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 14, 2014 is greater than 7.00%.

(ii) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 14, 2015 is greater than 14.49%.

(iii) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 13, 2016 is greater than 22.50%.

(iv) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 12, 2017 is greater than 31.08%.

(v) Any of the LTIP Units not previously Vested under paragraphs 3(a)(i) –
(iv) shall Vest if the Company TSR for the Measurement Period ending on May 14,
2018 is greater than 40.25%.

 

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(b) Index TSR. Up to one-half of the LTIP Units shall: (A) Vest as of the end of
the applicable Measurement Period as provided in the following paragraphs (i),
(ii), (iii), (iv) and (v); and (B) be forfeited as of May 14, 2018 if not Vested
on or before May 14, 2018.

(i) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 14, 2014 exceeds the percentage increase (or is less
negative than the percentage decrease) in the Index for the same period.

(ii) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 14, 2015 exceeds the percentage increase (or is less
negative than the percentage decrease) in the Index for the same period.

(iii) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 13, 2016 exceeds the percentage increase (or is less
negative than the percentage decrease) in the Index for the same period.

(iv) 10% of the LTIP Units shall Vest if the Company TSR for the Measurement
Period ending on May 12, 2017 exceeds the percentage increase (or is less
negative than the percentage decrease) in the Index for the same period.

(v) Any of the LTIP Units not previously Vested under paragraphs 3(b)(i) –
(iv) shall Vest if the Company TSR for the Measurement Period ending on May 14,
2018 exceeds the percentage increase (or is less negative than the percentage
decrease) in the Index for the same period.

4. Definitions. For purposes of this Agreement, the following terms shall have
the definitions set forth below.

(a) “Cause” shall have the same meaning as set forth in the Employment
Agreement.

(b) “Company TSR” means the total shareholder return (appreciation/depreciation
of the price per share of Common Stock plus dividends paid on a share of Common
Stock) during the applicable Measurement Period, expressed as a percentage. The
calculation of Company TSR shall measure the percentage difference between
(x) the average closing prices as reported on the national securities exchange
on which it is then trading for each of the ten trading days ending on the last
day of the applicable Measurement Period and each of the ten trading days
beginning immediately after the last day of the applicable Measurement Period
and (y) $21.00 (which amount shall be adjusted appropriately to reflect any
stock splits and any stock combinations of Common Stock occurring during the
applicable Measurement Period). The calculation of Company TSR shall assume that
dividends paid on a share of Common Stock are reinvested in additional shares of
Common Stock (“Reinvested Shares”) based on the Fair Market Value on the date
the dividend is paid. Dividends paid on the number of shares of Common Stock
equal to the number of Reinvested Shares also shall be taken into account in the
calculation of Company TSR.

 

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(c) “Good Reason” shall have the same meaning as set forth in the Employment
Agreement.

(d) “Index” means the SNL US REIT Equity Index.

(e) “Measurement Period” means the period beginning on May 14, 2013 and ending
on (i) May 14, 2014 for purposes of Sections 3(a)(i) and 3(b)(i); (ii) May 14,
2015 for purposes of Sections 3(a)(ii) and 3(b)(ii); (iii) May 13, 2016 for
purposes of Sections 3(a)(iii) and 3(b)(iii); (iv) May 12, 2017 for purposes of
Sections 3(a)(iv) and 3(b)(iv); and (v) May 14, 2018 for purposes of Sections
3(a)(v) and 3(b)(v).

5. Acceleration of Vesting in Special Circumstances.

(a) If the Grantee remains in the continuous employ of the Company or an
Affiliate from the Date of Grant until the date that the Grantee’s employment
with the Company and its Affiliates ends on account of (i) termination by the
Company without Cause, (ii) resignation for Good Reason in accordance with the
Employment Agreement, (iii) resignation within 90 days after notice of
non-renewal is given by the Company as provided in the Employment Agreement,
(iv) death, or (v) disability as provided in the Employment Agreement, then as
of the date that the Grantee’s employment so ends, all of the LTIP Units
outstanding shall Vest. In consideration for the grant of the LTIP Units, the
Grantee agrees that (A) any Vesting in the LTIP Units due to a termination or
resignation described in clauses (i), (ii) or (iii) above shall not occur unless
the Grantee executes and does not revoke the release of claims described in the
Employment Agreement and (B) this Section 5 shall govern the Grantee’s rights
in, and the Vesting of, the LTIP Units upon a termination of employment,
notwithstanding any contrary provision in the Employment Agreement.

(b) In contemplation of and subject to the consummation of a Change in Control,
all of the LTIP Units outstanding shall Vest if the Grantee remains in the
continuous employ of the Company or an Affiliate from the Date of Grant until
the Control Change Date for such Change in Control.

6. Merger-Related Action. In contemplation of and subject to the consummation of
a consolidation or merger or sale of all or substantially all of the assets of
the Company in which outstanding common stock are exchanged for securities,
cash, or other property of an unrelated corporation or business entity or in the
event of a liquidation of the Company (in each case, a “Transaction”), to the
extent that the LTIP Units have not been converted into Common Units as of or
immediately prior to the consummation of the Transaction in accordance with the
limitations and qualifications described in Sections 6(a), (b) and (c), the
Board of Directors of the Company, or the board of trustees or directors of any
corporation assuming the obligations of the Company (the “Acquiror”), may, in
its discretion, take any one or more of the following actions, as to the LTIP
Units then outstanding: (i) provide that such LTIP Units shall be assumed or
equivalent awards shall be substituted, by the acquiring or succeeding entity
(or an affiliate thereof), and/or (ii) upon prior written notice to the holder
of the LTIP Units of not less than 30 days, provide that such LTIP Units shall
terminate immediately prior to the consummation of the

 

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Transaction. The right to take such actions (each, a “Merger-Related Action”)
shall be subject to the following limitations and qualifications:

(a) if all of the LTIP Units are eligible, as of the time of the Merger-Related
Action, for conversion into Common Units (as defined in and in accordance with
the Partnership Agreement), the holder of such LTIP Units shall be afforded the
opportunity to effect such conversion and, to the extent the Common Units
resulting from such conversion are not then redeemed pursuant to the Partnership
Agreement, receive, in consideration for the Common Units into which such LTIP
Units shall have been converted, the same kind and amount of consideration as
other holders of Common Units in connection with the Transaction, then
Merger-Related Action of the kind specified in (i) or (ii) above shall be
permitted and available to the Company and the Acquiror;

(b) if some or all of the LTIP Units are not, as of the time of the
Merger-Related Action, so eligible for conversion into Common Units (in
accordance with the Partnership Agreement), and the acquiring or succeeding
entity is itself, or has a subsidiary which is organized as a partnership or
limited liability company (consisting of a so-called “UPREIT” or other structure
substantially similar in purpose or effect to that of the Company and ARP OP),
then, if the holder of such LTIP Units requests in writing, Merger-Related
Action of the kind specified in clause (i) of this Section 6 above must be taken
by the Acquiror with respect to all of the LTIP Units which are not so
convertible at the time, whereby all such LTIP Units shall be assumed by the
acquiring or succeeding entity, or equivalent awards shall be substituted by the
acquiring or succeeding entity, and the acquiring or succeeding entity shall
preserve with respect to the assumed LTIP Units or any securities to be
substituted for such LTIP Units, as far as reasonably possible under the
circumstances, the distribution, special allocation, conversion and other rights
set forth in the Partnership Agreement for the benefit of LTIP Unitholders (as
defined in the Partnership Agreement); and

(c) if (i) some or all of the LTIP Units are not, as of the time of the
Merger-Related Action, so eligible for conversion into Common Units (in
accordance with the Partnership Agreement) and (ii)(A) the holder of such LTIP
Units does not request in writing the action described in Section 6(b), or
(B) the holder of such LTIP Units does request in writing the action described
in Section 6(b), but after exercise of reasonable commercial efforts the Company
or the Acquiror is unable to treat the LTIP Units in accordance with
Section 6(b), then Merger-Related Action of the kind specified in clause (ii) of
Section 6 must be taken by the Company or the Acquiror, in which case such
action shall be subject to a provision that the settlement of the terminated
award of the LTIP Units which are not convertible into Common Units requires a
payment of the same kind and amount of consideration payable in connection with
the Transaction to a holder of the number of Common Units into which the LTIP
Units to be terminated could be converted or, if greater, the consideration
payable to holders of the number of shares of common stock into which such
Common Units could be exchanged (including the right to make elections as to the
type of consideration) if the Transaction were of a nature that permitted a
revaluation of the holder’s capital account balance under the terms of the
Partnership Agreement, as determined by the Committee in good faith in
accordance with the Plan.

 

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7. Distributions and Unitholder Rights. In consideration of the grant of this
award, the Grantee agrees that: (i) the LTIP Units cannot be voted by the
Grantee before the date that they become Vested; (ii) 45% of distributions made
on the LTIP Units will be paid to the Grantee as and when ARP OP makes such
distributions, and 55% of such distributions will not be paid to the Grantee
before the date that the LTIP Units become Vested; (iii) to the extent any of
the LTIP Units become Vested, within 30 days after they become Vested, the
Company will pay the Grantee a cash amount equal to 55% of the cumulative amount
of distributions that would have been paid on the number of the LTIP Units that
have become Vested had the Grantee held such LTIP Units during the Measurement
Period; and (iv) other than the distributions described in clauses (ii) and
(iii) of this sentence, no cash amount will be paid with respect to any of the
LTIP Units that do not become Vested. The Grantee hereby appoints the Company’s
Secretary as the Grantee’s attorney-in-fact, with full power of substitution,
with the power to transfer to the Partnership and cancel any of the LTIP Units
that are forfeited.

8. Incorporation of Plan. Notwithstanding anything herein to the contrary, this
Award shall be subject to all of the terms and conditions of the Plan and the
Partnership Agreement.

9. Covenants. The Grantee hereby covenants as follows:

(a) So long as the Grantee holds any of the LTIP Units, the Grantee shall
disclose to ARP OP in writing such information as may be reasonably requested
with respect to ownership of the LTIP Units as ARP OP may deem reasonably
necessary to ascertain and to establish compliance with provisions of the
Internal Revenue Code of 1986, as amended (the “Code”), applicable to ARP OP or
to comply with requirements of any other appropriate taxing authority.

(b) The Grantee hereby agrees to make an election under Section 83(b) of the
Code with respect to the LTIP Units, and the Company hereby consents thereto.
The Grantee has delivered with this Agreement a completed, executed copy of the
election form attached hereto as Annex B. The Grantee agrees to file the
election (or to permit ARP OP to file such election on the Grantee’s behalf)
within 30 days after the Grant Date with the IRS Service Center at which such
Grantee files his personal income tax returns, and to file a copy of such
election with the Grantee’s U.S. federal income tax return for the taxable year
in which the LTIP Units are awarded to the Grantee.

(c) The Grantee hereby agrees that it does not have the intention to dispose of
the LTIP Units within two years of receipt of such LTIP Units. ARP OP and the
Grantee hereby agree to treat the Grantee as the owner of the LTIP Units from
the Grant Date. The Grantee hereby agrees to take into account the distributive
share of ARP OP income, gain, loss, deduction, and credit associated with the
LTIP Units in computing the Grantee’s income tax liability for the entire period
during which the Grantee has the LTIP Units.

(d) The Grantee hereby recognizes that the IRS has proposed regulations under
Sections 83 and 704 of the Code that may affect the proper treatment of the LTIP
Units for federal tax purposes. In the event that those proposed regulations are
finalized, the Grantee hereby agrees to cooperate with ARP OP in amending this
Agreement and the Partnership Agreement, and to take such other action as may be
required, to conform to such regulations.

 

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(e) The Grantee hereby recognizes that the U.S. Congress is considering
legislation that would change the federal tax consequences of owning and
disposing of LTIP Units.

10. Transferability. This Agreement is personal to the Grantee, is
non-assignable and is not transferable in any manner, by operation of law or
otherwise, other than by will or the laws of descent and distribution, without
the prior written consent of the Company.

11. Amendment. The Grantee acknowledges that the Plan may be amended or canceled
or terminated in accordance with Article XVI thereof and that this Agreement may
be amended or cancelled by the Committee, on behalf of ARP OP, for the purpose
of satisfying changes in law or for any other lawful purpose, provided that no
such action shall adversely affect the Grantee’s rights under this Agreement
without the Grantee’s written consent. The provisions of Section 6 of this
Agreement applicable to the termination of the LTIP Units in connection with a
Transaction shall apply, mutatis mutandi, to amendments, discontinuance or
cancellation pursuant to this Section 11 or the Plan.

12. No Obligation to Continue Employment. Neither the Company nor any affiliate
of the Company is obligated by or as a result of the Plan or this Agreement to
continue the Grantee in employment and neither the Plan nor this Agreement shall
interfere in any way with the right of the Company or any affiliate of the
Company to terminate the employment of the Grantee at any time.

13. Notices. Notices hereunder shall be mailed or delivered to ARP OP at its
principal place of business and shall be mailed or delivered to the Grantee at
the address on file with ARP OP or, in either case, at such other address as one
party may subsequently furnish to the other party in writing.

14. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, applied without regard to
conflict of law principles. The parties agree that any action or proceeding
arising directly, indirectly or otherwise in connection with, out of, related to
or from this Agreement, any breach hereof or any action covered hereby, shall be
resolved within the State of Delaware and the parties hereto consent and submit
to the jurisdiction of the federal and state courts located within the City of
Phoenix, Arizona. The parties hereto further agree that any such action or
proceeding brought by either party to enforce any right, assert any claim,
obtain any relief whatsoever in connection with this Agreement shall be brought
by such party exclusively in federal or state courts located within the City of
Phoenix, Arizona.

[Signatures appear on following page.]

 

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AMERICAN RESIDENTIAL PROPERTIES, INC.     a Maryland corporation

/s/ Laurie A. Hawkes

Name:   Laurie A. Hawkes Title:   President and Chief Operating Officer Date:  
November 5, 2013

AMERICAN RESIDENTIAL PROPERTIES OP, L.P.

    a Delaware limited partnership

By:   AMERICAN RESIDENTIAL GP, LLC   its general partner By:   AMERICAN
RESIDENTIAL PROPERTIES, INC.   its sole member

/s/ Laurie A. Hawkes

Name:   Laurie A. Hawkes Title:   President and Chief Operating Officer Date:  
November 5, 2013

The foregoing agreement is hereby accepted and the terms and conditions thereof
hereby agreed to by the Grantee.

 

Date: November 5, 2013      

/s/ Stephen G. Schmitz

      Grantee’s Signature

[Signature page to IPO LTIP Unit Performance-Based Award Vesting Agreement ––
executives]