Document:

exv10w1

Exhibit 10.1

AGREEMENT AND PLAN OF MERGER

     AGREEMENT AND PLAN OF MERGER (this “Agreement”), dated as of February 11, 2011, by and among
NATIONAL PROPERTY INVESTORS III, a California limited partnership (“NPI”), NATIONAL PROPERTY
INVESTORS III, LP, a Delaware limited partnership (“New NPI”), AIMCO NPI III MERGER SUB LLC, a
Delaware limited liability company (the “Aimco Subsidiary”), and AIMCO PROPERTIES, L.P., a Delaware
limited partnership (“Aimco OP”).

     WHEREAS, NPI Equity Investments, Inc., the managing general partner of NPI and New NPI (“NPI
Equity”), has determined that the merger of NPI with and into New NPI, with New NPI as the
surviving entity, and the subsequent merger of the Aimco Subsidiary with and into New NPI, with New
NPI as the surviving entity, in each case, on the terms set forth herein, are advisable and in the
best interests of NPI and New NPI and their respective partners; and

     WHEREAS, Aimco OP is the sole member of the Aimco Subsidiary and the sole limited partner of
New NPI; and

     WHEREAS the Board of Directors of AIMCO-GP, Inc., the general partner of Aimco OP
(“AIMCO-GP”), has determined that the merger of NPI with and into New NPI, with New NPI as the
surviving entity, and the subsequent merger of the Aimco Subsidiary with and into New NPI, with New
AP NPI as the surviving entity, in each case, on the terms as set forth herein, are advisable and
in the best interests of Aimco OP and its partners, and the Aimco Subsidiary; and

     WHEREAS, a majority in interest of the limited partners of each of NPI and New NPI have
approved this Agreement and the transactions contemplated hereby; and

     WHEREAS, the parties desire to enter into this Agreement to evidence the terms, provisions,
representations, warranties, covenants and conditions upon which the Mergers (as defined below)
will be consummated.

     NOW, THEREFORE, in consideration of the mutual agreements and covenants set forth herein, and
for other good and valuable consideration, the adequacy, sufficiency, and receipt of which are
hereby acknowledged, the parties hereby agree as follows:

          SECTION 1. The First Merger. Subject to the terms and conditions set forth herein, NPI shall
be merged with and into New NPI (the “First Merger”), with New NPI as the surviving entity (the
“First Surviving Entity”). As soon as practicable after all of the conditions to the First Merger
set forth herein have been satisfied, (i) NPI and New NPI shall execute a certificate of merger and
cause such certificate to be filed with the Secretary of State of the State of California and (ii)
New NPI shall execute a certificate of merger and cause such certificate to be filed with the
Secretary of State of the State of Delaware. The First Merger shall become effective upon the
filing of such certificates (the “First Effective Time”). At the First Effective Time, the First
Merger shall have the effect provided by applicable law and this Agreement, including, but not
limited to, the following consequences:

          (a) Certificate of Limited Partnership. The certificate of limited partnership of New
NPI in effect immediately prior to the First Effective Time shall be the certificate of limited
partnership of the First Surviving Entity unless and until subsequently amended.

          (b) Partnership Agreement. The partnership agreement of NPI in effect immediately
prior to the First Effective Time, as amended as set forth on Exhibit A hereto, shall be
the partnership agreement of the First Surviving Entity unless and until subsequently amended.
The general partners and each limited partner of the First Surviving Entity shall have the rights
under, be bound by and be subject to the terms and conditions of, such partnership agreement.

 

 

          (c) General Partner. NPI Equity shall be the managing general partner of the First
Surviving Entity.

          (d) Conversion of Equity Interests.

          (i) Interests in NPI. Each general partnership interest of NPI outstanding
immediately prior to the First Effective Time and held by a general partner shall be
converted into an equivalent general partnership interest in the First Surviving Entity
(each new general partnership interest, a “New NPI GP Interest”). Each unit of limited
partnership interest of NPI outstanding immediately prior to the First Effective Time shall
be converted into an equivalent unit of limited partnership interest in the First Surviving
Entity (a “New NPI Unit”).

          (ii) Interests in New NPI. The interest of each partner in New NPI
immediately prior to the First Effective Time shall be cancelled.

          SECTION 2. The Second Merger. Subject to the terms and conditions set forth herein,
immediately following the First Effective Time, the Aimco Subsidiary shall be merged with and into
New NPI (the “Second Merger” and, together with the First Merger, the “Mergers”), with New NPI as
the surviving entity (the “Second Surviving Entity”). As soon as practicable after all of the
conditions to the Second Merger set forth herein have been satisfied, New NPI shall cause to be
filed a certificate of merger with respect to the Second Merger with the Secretary of State of the
State of Delaware. The Second Merger shall become effective upon the filing of such certificate
(the “Second Effective Time”). At the Second Effective Time, the Second Merger shall have the
effect provided by applicable law and this Agreement, including, but not limited to, the following
consequences:

     (a) Certificate of Limited Partnership. The certificate of limited
partnership of New NPI in effect immediately prior to the Second Effective Time shall be
the certificate of limited partnership of the Second Surviving Entity unless and until
subsequently amended.

     (b) Partnership Agreement. The partnership agreement of New NPI in effect
immediately prior to the Second Effective Time shall be the partnership agreement of the
Second Surviving Entity (the “Partnership Agreement”) unless and until subsequently
amended. The general partners and each limited partner of the Second Surviving Entity
shall have the rights under, be bound by and be subject to the terms and conditions of, the
Partnership Agreement.

     (c) General Partners. NPI Equity shall be the managing general partner of the
Second Surviving Entity.

     (d) Treatment of Limited Partners Interests in New NPI.

          (i) In connection with the Second Merger and in accordance with the procedures set
forth in Section 2(d)(iii) hereto, each New NPI Unit outstanding immediately prior to the
Second Effective Time, except New NPI Units held by limited partners who have perfected
their appraisal rights pursuant to Exhibit B hereto, shall be converted into the
right to receive, at the election of the holder thereof, either (x) $57.24 in cash (the
“Cash Consideration”) or (y) a number of partnership common units (“OP Units”) of Aimco OP
calculated by dividing $57.24 by the average closing price of Apartment Investment and
Management Company common stock, as reported on the NYSE, over the ten consecutive trading
days ending on the second trading day immediately prior to the date of the Second Effective
Time (the “OP Unit Consideration”, and, together with the Cash Consideration, the “Merger
Consideration”).

          (ii) Notwithstanding Section 2(d)(i), if Aimco OP determines that the law of the state
or other jurisdiction in which a holder of New NPI Units resides would prohibit the
issuance of OP Units in that state or jurisdiction, or that the registration in that state
or other jurisdiction would be prohibitively costly (each such state or jurisdiction, a
“Specified

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Jurisdiction”), then such holder will only be entitled to receive the Cash
Consideration for each New NPI Unit.

          (iii) Aimco OP shall prepare a form of election (the “Election Form”) describing the
Second Merger, pursuant to which each holder of New NPI Units will have the right to elect
to receive either the Cash Consideration or the OP Unit Consideration (subject to Section
2(d)(ii)). Aimco OP shall mail or cause to be mailed an Election Form to each holder of
New NPI Units, together with any other materials that Aimco OP determines to be necessary
or prudent, no later than ten (10) days after the Second Effective Time. An election to
receive the Cash Consideration or the OP Unit Consideration shall be effective only if a
properly executed Election Form is received by Aimco OP or its designees prior to 5:00
p.m., New York time on the day that is thirty (30) days after the mailing of such Election
Form by Aimco OP. If a holder New NPI Units fails to return a duly completed Election Form
within the time period specified in the Election Form, such holder shall be deemed to have
elected to receive the Cash Consideration. In addition, each holder of New NPI Units that
resides in a Specified Jurisdiction will be deemed to have elected the Cash Consideration.
NPI, New NPI, the Aimco Subsidiary and Aimco OP agree that holders of New NPI Units shall
have the right to revoke any election made in connection with the Second Merger at any time
prior to the expiration of the time period stated in the Election Form. Aimco OP and NPI
Equity, by mutual agreement, shall have the right to make rules, not inconsistent with the
terms of this Agreement, governing the validity of Election Forms and the issuance and
delivery of the Merger Consideration, as applicable.

     (e) Treatment of General Partners’ Interests. Each New NPI GP Interest
outstanding immediately prior to consummation of the Second Merger shall remain outstanding
and unchanged, with all of the rights set forth in the Partnership Agreement.

     (f) Treatment of Interests in the Aimco Subsidiary. The entire membership
interest in the Aimco Subsidiary immediately prior to the Second Effective Time shall be
converted into one thousand (1,000) New NPI Units of the Second Surviving Entity.

          SECTION 3. Appraisal Rights. In connection with the First Merger, none of the partners in NPI
or New NPI will have any dissenters’ appraisal rights. In connection with the Second Merger, the
holders of New NPI Units immediately prior to the Second Merger shall have the appraisal rights set
forth in Exhibit B hereto.

          SECTION 4. Covenants. Aimco OP agrees to pay for, or reimburse NPI and New NPI for, all
expenses incurred by NPI and New NPI in connection with the Mergers and the transactions
contemplated hereby. Aimco OP agrees to pay cash or issue and deliver OP Units to the former
holders of New NPI Units, in accordance with Section 2(d) of this Agreement.

          SECTION 5. Conditions to the Mergers. Notwithstanding any provisions of this Agreement to the
contrary, none of the parties hereto shall be required to consummate the transactions contemplated
hereby if any third-party consent, authorization or approval that any of the parties hereto deem
necessary or desirable in connection with this Agreement, or the consummation of the transactions
contemplated hereby, has not been obtained or received.

          SECTION 6. Tax Treatment.

     (a) First Merger. The parties hereto acknowledge and agree that for federal
income tax purposes, the First Merger will be treated as follows:

          (i) NPI will be deemed to have obtained as a result of the First Merger an initial
capital account balance in the First Surviving Entity reflecting the tax bases of the
assets so treated as contributed by NPI to the First Surviving Entity.

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          (ii) Each partner in the First Surviving Entity will have an initial capital account
balance in the First Surviving Entity equal to its proportionate share of such initial
capital account balance so deemed obtained by NPI.

          (iii) In accordance with the foregoing, the respective initial capital account
balances of the general partners and limited partners of the First Surviving Entity
immediately following the First Effective Time shall be the same as those of the general
partners and the limited partners of NPI immediately prior to the First Effective Time.

          (iv) The First Merger should not be treated as a realization event and, in accordance
with the foregoing, the First Surviving Entity shall be treated as the continuation of NPI
for federal income tax purposes.

     (b) Second Merger. The parties hereto intend and agree that, for Federal
income tax purposes, (i) any payment of cash for New NPI Units shall be treated as a sale
of such New NPI Units by such holder and a purchase of such New NPI Units by Aimco OP for
the cash so paid under the terms of this Agreement in accordance with the guidelines set
forth in Treas. Reg. Sections 1.708-1(c)(3) and 1.708-1(c)(4), and (ii) each such holder of
New NPI Units who accepts cash explicitly agrees and consents to such treatment.
Furthermore, the parties hereto intend and agree that, for Federal income tax purposes, (i)
any exchange of New NPI Units for OP Units under the terms of this Agreement shall be
treated in accordance with Sections 721 and 731 of the Internal Revenue Code of 1986, as
amended, and (ii) each such holder of New NPI Units who accepts OP Units explicitly agrees
and consents to such treatment. Any cash and/or OP Units to which a holder of New NPI
Units is entitled pursuant to this Agreement shall be paid only after the receipt of a
consent from such holder that, for Federal income tax purposes, the receipt of cash and/or
OP Units shall be treated as described in this Section 6(b).

     SECTION 7. Further Assurances.

     (a) From time to time, as and when required by the First Surviving Entity or by its
successors and assigns, there shall be executed and delivered on behalf of NPI such deeds
and other instruments, and there shall be taken or caused to be taken by NPI all such
further actions, as shall be appropriate or necessary in order to vest, perfect or confirm,
of record or otherwise, in the First Surviving Entity the title to and possession of all
property, interests, assets, rights, privileges, immunities, powers, franchises and
authority of NPI, and otherwise to carry out the purposes of this Agreement, and the
officers and directors of NPI Equity are fully authorized in the name and on behalf NPI or
otherwise to take any and all such action and to execute and deliver any and all such deeds
and other instruments.

     (b) From time to time, as and when required by the Second Surviving Entity or by its
successors and assigns, there shall be executed and delivered on behalf of the Aimco
Subsidiary such deeds and other instruments, and there shall be taken or caused to be taken
by the Aimco Subsidiary all such further actions, as shall be appropriate or necessary in
order to vest, perfect or confirm, of record or otherwise, in the Second Surviving Entity
title to and possession of all property, interests, assets, rights, privileges, immunities,
powers, franchises and authority of the Aimco Subsidiary, and otherwise to carry out the
purposes of this Agreement, and the officers and directors of NPI Equity are fully
authorized in the name and on behalf of Aimco Subsidiary or otherwise to take any and all
such action and to execute and deliver any and all such deeds and other instruments.

          SECTION 8. Amendment. Subject to applicable law, this Agreement may be amended, modified or
supplemented by written agreement of the parties hereto at any time prior to the consummation of
the Mergers with respect to any of the terms contained herein.

          SECTION 9. Abandonment. At any time prior to consummation of the Mergers, this Agreement may
be terminated and the Mergers may be abandoned without liability to any party hereto

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by any of the Aimco Subsidiary, Aimco OP, NPI or New NPI, in each case, acting in its sole
discretion and for any reason or for no reason, notwithstanding approval of this Agreement by any
of the members of the Aimco Subsidiary, the partners of NPI or the general partner of Aimco OP.

          SECTION 10. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without reference to the conflict of law provisions
thereof.

          SECTION 11. No Third-Party Beneficiaries. No provision of this Agreement is intended to
confer upon any person, entity, or organization other than the parties hereto any rights or
remedies hereunder, other than the appraisal rights given to holders of New NPI Units pursuant to
Section 3.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
date first above written.

	 	 	 	 	 
	 	NATIONAL PROPERTY INVESTORS III

 	 
	 	By:  	NPI Equity Investments, Inc.,
 	 
	 	 	its Managing General Partner 	 
	 	 	 	 

					
	 	By:  	/s/ Derek S. McCandless 	 
	 	 	Name:  	Derek S. McCandless 	 
	 	 	Title:  	Senior Vice President and

Assistant General Counsel 	 

	 	 	 	 	 
	 	NATIONAL PROPERTY INVESTORS III, LP

 	 
	 	By:  	NPI Equity Investments, Inc.,
 	 
	 	 	its Managing General Partner 	 

					
	 	
 	 
	 	By:  	/s/ Derek S. McCandless 	 
	 	 	Name:  	Derek S. McCandless 	 
	 	 	Title:  	Senior Vice President and

Assistant General Counsel 	 

	 	 	 	 	 
	 	AIMCO NPI III MERGER SUB LLC

 	 
	 	By:  	AIMCO Properties, L.P.,
 	 
	 	 	its Sole Member 	 

					
	 	
 	 
	 	By:  	                          AIMCO-GP, Inc.,
 	 
	 	 	its General Partner 	 

					
	 	
 	 
	 	By:  	/s/ Derek S. McCandless 	 
	 	 	Name:  	Derek S. McCandless	 
	 	 	Title:  	Senior Vice President and

Assistant General Counsel	 

	 	 	 	 	 
	 	AIMCO PROPERTIES, L.P.

 	 
	 	By:  	AIMCO-GP, Inc.,
 	 
	 	 	its General Partner 	 
	 

					
	 	By:  	/s/ Derek S. McCandless 	 
	 	 	Name:  	Derek S. McCandless	 
	 	 	Title:  	Senior Vice President and

Assistant General Counsel	 
	 

[Signature Page — Merger Agreement of NPI III]

 

 

EXHIBIT A

SECOND AMENDMENT

TO

PARTNERSHIP AGREEMENT

OF

NATIONAL PROPERTY INVESTORS III

               This SECOND AMENDMENT TO THE PARTNERSHIP AGREEMENT OF NATIONAL PROPERTY INVESTORS III (this
“Amendment”) is entered into as of February 11, 2011 by and among NPI Equity Investments,
Inc., a Florida corporation, in its capacity as managing general partner (the “Managing General
Partner”), and each of the Limited Partners. All capitalized terms used in this Amendment but
not otherwise defined herein shall have the respective meanings given to them in the Partnership
Agreement (as defined below).

Recitals

               WHEREAS, National Property Investors III, a California limited partnership (the
“Partnership”), is governed pursuant to the terms of that certain Partnership Agreement,
dated as of February 1, 1979, as amended and restated July 1, 1979 and as further amended to date
(the “Partnership Agreement”);

               WHEREAS, the Partnership and National Property Investors III, LP, a Delaware limited
partnership (the “Delaware Partnership”), are parties to an Agreement and Plan of Merger,
dated as of February 11, 2011 (the “Merger Agreement”);

               WHEREAS, pursuant to the Merger Agreement, the Partnership will be merged with and into the
Delaware Partnership, with the Delaware Partnership as the surviving entity (the “Merger”);

               WHEREAS, pursuant to the Merger Agreement, at the effective time of the Merger, the
Partnership Agreement, as further amended by this Amendment, will become the partnership agreement
of the Delaware Partnership; and

               WHEREAS, the Merger will be effected upon the approval or consent of (i) the managing general
partner of each of the Partnership and the Delaware Partnership, and (ii) a majority in interest of
the limited partners of each of the Partnership and the Delaware Partnership.

               NOW, THEREFORE, in consideration of the premises, the agreement of the parties herein
contained, and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged and confessed, the parties hereby agree as follows:

	1.	 	Amendments to the Partnership Agreement. At the effective time of the Merger, the
Partnership Agreement shall be amended as follows:

	 	(a)	 	In the first paragraph of the Partnership Agreement, the following words are
deleted: “pursuant to the Uniform Limited Partnership Act of the State of California.”

 

 

	 	(b)	 	All other references therein to the Uniform Limited Partnership Act of the
State of California or to the Uniform Limited Partnership Act of California shall be
deemed to refer to the Delaware Revised Uniform Limited Partnership Act.
	 
	 	(c)	 	Section 1 of the Partnership Agreement is hereby amended and restated to read
in its entirety as follows:
	 
	 	 	 	“1.1 The name of the Partnership is National Property Investors III, LP, and its
principal place of business is 55 Beattie Place, P.O. Box 1089, Greenville, South
Carolina 29602 and thereafter such other place or places as the Managing General
Partner may from time to time determine.

	 	 	  	1.2 National Property Investors III was originally formed as a limited partnership
(the “California Partnership”) pursuant to the provisions of the California Uniform
Limited Partnership Act, upon the terms and conditions set forth in an agreement
made as of February 1, 1979. Pursuant to an Agreement and Plan of Merger, dated as
of February 11, 2011, by and between the California Partnership and National
Property Investors III, LP, a Delaware limited partnership (the “Delaware
Partnership”), the California Partnership was merged with and into the Delaware
Partnership, with the Delaware Partnership as the surviving entity (the “Surviving
Entity”) in the merger (the “Merger”). At the effective time of the Merger (the
“Effective Time”), the Merger had the effect provided by applicable law, and the
following consequences: (a) the certificate of limited partnership of the
Delaware Partnership in effect immediately prior to the Effective Time became the
certificate of limited partnership of the Surviving Entity; (b) the partnership
agreement of the California Partnership in effect immediately prior to the
Effective Time, as amended as set forth on Annex A to the Merger Agreement,
became the partnership agreement of the Surviving Entity (as so amended, the
“Partnership Agreement”); (c) NPI Equity Investments, Inc., a Florida corporation,
remained as sole Managing General Partner of the Surviving Entity, and its interest
in the California Partnership immediately prior to the Effective Time was converted
into an equivalent interest in the Surviving Entity; (d) the interest of the
general partner in the Delaware Partnership immediately prior to the Effective Time
was cancelled; (e) each limited partner in the California Partnership became a
limited partner in the Surviving Entity, with an interest in the Surviving Entity
equivalent to the interest such limited partner had in the California Partnership
immediately prior to the Effective Time; (f) the interest of each limited partner
in the Delaware Partnership immediately prior to the Effective Time was cancelled.
References herein to the “Partnership” are to the California Partnership prior to
the Merger and to the Delaware Partnership, as the Surviving Entity in the Merger,
from and after the Effective Time.”

	 
	 	(d)	 	Section 2.1.15 of the Partnership Agreement is hereby amended and restated to
read in its entirety as follows:
	 
	 	 	 	“2.1.15 “General Partner” shall refer to NPI Equity Investments, Inc., a Florida
corporation, or to any other person or entity who succeeds it in such capacity.”
	 
	 	(e)	 	Section 2.1.22 of the Partnership Agreement is hereby amended and restated to
read in its entirety as follows:

 

 

	 	 	 	“2.1.22 “Managing General Partner” shall refer to NPI Equity Investments, Inc., or
to any other person or entity who succeeds in such capacity.”
	 
	 	(f)	 	Section 2.1.32 of the Partnership Agreement is hereby amended to delete such
section in its entirety.
	 
	 	(g)	 	Section 16.5 of the Partnership Agreement is hereby amended by deleting the
last sentence thereof.
	 
	 	(h)	 	Section 20.1.1 of the Partnership Agreement is hereby amended by deleting
everything after the word “foregoing.”
	 
	 	(i)	 	Section 22.7 of the Partnership Agreement is hereby amended and restated to
read in its entirety as follows:

	 	 	 	“The name and address of the General Partner and the Managing General Partner is:

NPI Equity Investments, Inc.

4582 S. Ulster St., Suite 1100

Denver, CO 80237”

	 	(j)	 	Section 22.9 of the Partnership Agreement is hereby amended and restated to
read in its entirety as follows:
	 
	 	 	 	“22.9 Notwithstanding the place where this Agreement may be executed by any of the
parties hereto, the parties expressly agree that all the terms and provisions of
hereof shall be construed under the laws of the State of Delaware and that the
Delaware Revised Uniform Limited Partnership Act as now adopted or as may be
hereafter amended shall govern the partnership aspects of this Agreement.”

	2.	 	Miscellaneous.

	 	(a)	 	Effect of Amendment. In the event of any inconsistency between the
terms of the Partnership Agreement and the terms of this Amendment, the terms of this
Amendment shall prevail. In the event of any conflict of apparent conflict between
any of the provisions of the Partnership Agreement as amended by this Amendment, such
conflicting provisions shall be reconciled and construed to give effect to the terms
and intent of this Amendment.
	 
	 	(b)	 	Ratification. Except as otherwise expressly modified hereby, the
Partnership Agreement shall remain in full force and effect, and all of the terms and
provisions of the Partnership Agreement, as herein modified, are hereby ratified and
reaffirmed.

 

 

	 	(c)	 	Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.

[Remainder of page intentionally left blank.]

 

 

          IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first set
forth above.

	 	 	 	 	 
	 	
The Managing General Partner:

NPI EQUITY INVESTMENTS, INC.,

a Florida corporation

 	 
	 	By:  	/s/ Derek S. McCandless 	 
	 	 	Name:  	Derek S. McCandless 	 
	 	 	Title:  	Senior Vice President and

Assistant General Counsel 	 
	 
	 	The Limited Partners:

 	 
	 	By:  	     NPI Equity Investments, Inc.,
 	 
	 	 	attorney-in-fact 	 
	 	 	 
	 	By:  	/s/ Derek S. McCandless 	 
	 	 	Name:  	Derek S. McCandless 	 
	 	 	Title:  	Senior Vice President and

Assistant General Counsel 	 

[Signature Page — Second Amendment to Partnership Agreement of NPI III]

 

 

EXHIBIT B

Appraisal Rights of Limited Partners

     Capitalized terms used but not defined herein shall have the respective meanings ascribed
thereto in the Agreement and Plan of Merger, dated as of February 11, 2011 (the “Merger
Agreement”), by and among National Property Investors III, a California limited partnership
(“NPI”), National Property Investors III, LP, a Delaware limited partnership (“New NPI”), AIMCO NPI
III Merger Sub LLC, a Delaware limited liability company (the “Aimco Subsidiary”), and AIMCO
Properties, L.P., a Delaware limited partnership (“Aimco OP”). In connection with the Second
Merger, limited partners of New NPI shall have the following appraisal rights:

     (a) Any limited partner who holds New NPI Units on the effective date of the Second Merger who
has not consented to the Second Merger (the “Nonconsenting Limited Partners”) and who has otherwise
complied with paragraph (b) hereof shall be entitled to an appraisal by arbitration of the fair
value of the Nonconsenting Limited Partner’s New NPI Units. This arbitration shall be conducted in
Denver, Colorado, in accordance with the Commercial Arbitration Rules of the American Arbitration
Association by a panel of three arbitrators selected by Aimco OP. Any arbitration award shall be
appealable in the Federal District Court located in Denver, Colorado.

     (b) Within 10 days after the effective date of the Second Merger, Aimco OP shall notify each
of the Nonconsenting Limited Partners of the consummation of the Second Merger, the effective date
of the Second Merger and that appraisal rights are available for any or all New NPI Units held by
Nonconsenting Limited Partners, and shall include in such notice a copy of this Exhibit. Such
notice shall include an Election Form pursuant to which Nonconsenting Limited Partners may elect an
appraisal by arbitration of the fair value of their New NPI Units pursuant to paragraph (a) hereof.
Any limited partner who holds New NPI Units on the effective date of the Second Merger and who has
not consented to the Second Merger shall be entitled to receive such notice and may, within 30 days
after the date of mailing of such notice (such 30th day being the “Election Deadline”), demand from
Aimco OP the appraisal of his or her New NPI Units by making the appropriate election in the
Election Form in accordance with the instructions thereto. Each completed Election Form must be
delivered to the address, and within the time period, specified in the instructions to the Election
Form. If a Nonconsenting Limited Partner fails to properly complete an Election Form or return it
to the correct address within the specified time period, such Nonconsenting Limited Partner shall
be deemed to have elected not to seek an appraisal of his or her New NPI Units, and will be deemed
to have elected the Cash Consideration.

     (c) At any time prior to the Election Deadline, any Nonconsenting Limited Partner who has made
a demand for appraisal of his or her New NPI Units shall have the right to withdraw his or her
demand for appraisal and to accept the Cash Consideration payable pursuant to the Merger Agreement.
Nonconsenting Limited Partners who wish to withdraw their demands must do so in writing delivered
to AIMCO Properties, L.P., c/o Eagle Rock Proxy Advisors, LLC, by mail at 12 Commerce Drive,
Cranford, New Jersey, 07016, or by fax at (908) 497-2349. At any time prior to 20 days after the
Election Deadline, any Nonconsenting Limited Partner who has complied with the requirements of
subsections (a) and (b) hereof, upon written request, shall be entitled to receive from Aimco OP a
statement setting forth the aggregate number of New NPI Units with respect to which Nonconsenting
Limited Partners have made demands for appraisal and the aggregate number of holders of such New
NPI Units. Such written statement shall be mailed to the Nonconsenting Limited Partner within 10
days after such Nonconsenting Limited Partner’s written request for such a statement is received by
Aimco OP or within 20 days after the Election Deadline, whichever is later.

     (d) Upon the submission of any such demand by a Nonconsenting Limited Partner, Aimco OP shall,
within 40 days after the Election Deadline, submit to the arbitration panel a duly verified list
containing the names and addresses of all Nonconsenting Limited Partners who have demanded payment
for their New NPI Units and with whom agreements as to the value of their New NPI Units have not
been reached with Aimco OP. The arbitration panel shall give notice of the time and place fixed for
the hearing

 

 

of such demand by registered or certified mail to Aimco OP and to the Nonconsenting Limited
Partners shown on the list at the addresses therein stated. The forms of the notices shall be
approved by the panel, and the costs thereof shall be borne by Aimco OP.

     (e) At the hearing on such demand, the panel shall determine the Nonconsenting Limited
Partners who have become entitled to appraisal rights hereunder.

     (f) After determining the Nonconsenting Limited Partners entitled to an appraisal, the panel
shall appraise the New NPI Units, determining their fair value exclusive of any element of value
arising from the accomplishment or expectation of the Second Merger, together with interest, if
any, to be paid upon the amount determined to be the fair value. In determining such fair value,
the panel shall take into account all relevant factors. Unless the panel in its discretion
determines otherwise for good cause shown, interest from the effective date of the Second Merger
through the date of payment of the judgment shall be compounded quarterly and shall accrue at 5%
over the Federal Reserve discount rate (including any surcharge), as established from time to time
during the period between the effective date of the Second Merger and the date of payment of the
judgment. Upon application by Aimco OP or by any Nonconsenting Limited Partner entitled to
participate in the appraisal proceeding, the panel may, in its discretion, proceed with the
appraisal prior to the final determination of the Nonconsenting Limited Partners entitled to an
appraisal. Any Nonconsenting Limited Partner whose name appears on the list submitted by Aimco OP
pursuant to paragraph (d) hereof may participate fully in all proceedings until it is finally
determined that such Nonconsenting Limited Partner is not entitled to appraisal rights hereunder.

     (g) The panel shall direct the payment of the fair value of the New NPI Units, together with
interest, if any, by Aimco OP to the Nonconsenting Limited Partners entitled thereto. Payment shall
be so made to each such Nonconsenting Limited Partner upon the receipt by Aimco OP of the written
consent from such Nonconsenting Limited Partner that, for federal income tax purposes, the issuance
of cash for the New NPI Units shall be treated as a sale of the New NPI Units by the owner and a
purchase of such New NPI Units by Aimco OP for the cash consideration so paid under the terms of
the Merger Agreement in accordance with the guidelines set forth in Treas. Reg. Sections
1.708-1(c)(3) and 1.708-1(c)(4).

     (h) The costs of the proceeding may be determined by the panel and taxed upon the parties as
the panel deems equitable in the circumstances. Upon application of a Nonconsenting Limited
Partner, the panel may order all or a portion of the expenses incurred by any Nonconsenting Limited
Partner in connection with the appraisal proceeding, including, without limitation, reasonable
attorney’s fees and the fees and expenses of experts, to be charged pro rata against the value of
all the interests entitled to an appraisal.

     (i) From and after the effective date of the Second Merger, no Nonconsenting Limited Partner
who has demanded appraisal rights as provided in paragraph (b) hereof shall be entitled to vote
such New NPI Units for any purpose or to receive payment of distributions on such interests (except
distributions payable as of a record date prior to the effective date of the Second Merger);
provided, however, that if such Nonconsenting Limited Partner shall deliver to
AIMCO Properties, L.P., c/o Eagle Rock Proxy Advisors, LLC, by mail at 12 Commerce Drive, Cranford,
New Jersey, 07016, or by fax at (908) 497-2349, a written withdrawal of such Nonconsenting Limited
Partner’s demand for an appraisal and an acceptance of the Cash Consideration payable pursuant to
the Merger Agreement, either as provided in paragraph (c) hereof or thereafter with the written
approval of Aimco OP, then the right of such Nonconsenting Limited Partner to an appraisal shall
cease. Notwithstanding the foregoing, no appraisal proceeding before the panel shall be dismissed
as to any Nonconsenting Limited Partner without the approval of the panel, and such approval may be
conditioned upon such terms as the panel deems just.exv10w28

Exhibit 10.28

Group 1 Automotive, Inc.

Summary of Non-Employee Director Compensation

Effective January 1, 2011

	 	 	 	 	 
	 	 	Amount
	Annual Retainer1:
	 	 	 	 
	Cash
	 	$	35,000	 
	Stock2
	 	 	95,000	 
	 
	 	 	 	 
	Additional Annual Retainers:
	 	 	 	 
	Non-Executive Chairman of the Board
	 	 	100,000	 
	Audit Committee Chair
	 	 	25,000	 
	Compensation Committee Chair
	 	 	15,000	 
	All Other Committee Chairs
	 	 	10,000	 
	 
	 	 	 	 
	Meeting Fees3:
	 	 	 	 
	Board
	 	 	2,500	 
	Audit Committee
	 	 	2,500	 
	Non-Audit Committee
	 	 	1,500	 
	 
	 	 	 	 
	Vehicle Stipend
	 	 	17,600	 

 

			
	1.	 	Payable in quarterly installments.
	 
	2.	 	Granted under Group 1 Automotive, Inc. 2007 Long Term Incentive Plan; valued at the date of
grant.
	 
	3.	 	Abbreviated meetings, as determined at the discretion of the chair, will result in the
payment of one-half of the regular fees for the meeting.

Summary of Director

Stock Ownership Guidelines

Approved November 2009

Directors are required to maintain ownership of a minimum of 10,000 shares of Group 1
Automotive, Inc.’s common stock. The minimum ownership requirement must be achieved within
five years of election to the Board of Directors. Restricted stock granted to directors as
part of the annual retainer counts toward the minimum ownership requirement without regard to the
vesting or other liquidity provisions related thereto.

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