form8-k.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
___________________
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): December 5, 2008 (December
5, 2008)
MID-AMERICA
APARTMENT COMMUNITIES, INC.
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(Exact
name of registrant as specified in its
charter)
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TENNESSEE
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1-12762
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62-1543819
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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6584
Poplar Avenue, Suite 300
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Memphis,
Tennessee
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38138
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: (901) 682-6600
N/A
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(Former
name or former address, if changed since last
report)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
[ ]
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Written
communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
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[ ]
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Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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[ ]
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Pre-commencement communications pursuant to
Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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[ ]
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Pre-commencement communications pursuant to
Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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ITEM
5.02
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Departure
of Directors of Certain Officers; Election of Directors; Appointment or
Certain Officers; Compensatory Arrangements of Certain
Officers
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On
December 5, 2008, each of H. Eric Bolton, Jr., President and Chief Executive
Officer of Mid-America Apartment Communities, Inc., and Simon R.C. Wadsworth,
Executive Vice President and Chief Financial Officer of Mid-America Apartment
Communities, Inc., entered into an amended and restated employment agreement
with Mid-America Apartment Communities, Inc. as approved by the Compensation
Committee of the Board of Directors of Mid-America America Apartment
Communities, Inc., or MAA Each original employment agreement was entered into in
December of 1999. Each agreement was amended to limit the potential payout to be
received by the executive as a result of a change of control payout occurring
within three years of the executive’s planned retirement from the
registrant. Each agreement was also amended to bring them in
compliance with Section 409A of the Internal Revenue Code.
Both
employment agreements have (i) a term of one year that renews automatically on
the first day of each month for an additional one-month period, so that on the
first day of each month, unless sooner terminated in accordance with the terms
of the agreement, the remaining term is one year; (ii) provide for an annual
base salary for Messrs. Bolton and Wadsworth, subject to change at the
discretion of the Compensation Committee; and (iii) allows for annual
incentive/bonus compensation. Mr. Bolton’s current base salary is
$407,753 per year and Mr. Wadsworth’s current base salary is $265,907 per
year.
Upon
Messrs. Bolton’s and/or Wadsworth’s termination due to death or permanent
disability or in the event they are terminated without cause by MAA or suffer a
constructive termination of their employment in the absence of a change of
control, MAA will pay Messrs. Bolton and/or Wadsworth all amounts due to them as
of the date of termination under the terms of all incentive and bonus plans, and
will also continue to pay them their base salary as then in effect for one year
after the termination. In addition, all stock options or restricted stock
granted to Messrs. Bolton and/or Wadsworth shall become fully vested and
exercisable in accordance with the terms on the termination
date. Alternatively, Messrs. Bolton and/or Wadsworth may elect to
receive an amount in cash equal to the in-the-money value of the shares covered
by all such options. Finally, MAA will pay to Messrs. Bolton and/or
Wadsworth all legal fees incurred by them in connection with their termination
without cause or constructive termination by MAA. In this scenario,
MAA’s current equity plans allow for the full vesting of any earned stock
options and restricted stock as defined by each individual plan.
If
Messrs. Bolton and/or Wadsworth are terminated without cause, suffer a
constructive termination in anticipation of, on, or within three years after a
change in control of MAA, or elect to terminate their employment for any reason
within thirty days after either a change of control event or the one year
anniversary of a change in control event, they are entitled to receive a payment
equal to the sum of two and 99/100 (2.99) times their annual base salary in
effect on the date of termination plus two and 99/100 (2.99) times their average
annual cash bonus paid during the two immediately preceding fiscal
years. However, if the change in control transaction occurs within
three years of the executive’s planned retirement date, the maximum change of
control payment would be the base salary and bonus payable to executive through
the anticipated date of retirement. To the extent that an excise tax
on excess parachute payments will be imposed on Messrs. Bolton and/or Wadsworth
under Section 4999 of the Internal Revenue Code as a result of such payment, MAA
shall pay them an additional amount sufficient to reimburse them for taxes
imposed pursuant to Sections 280G and 4999 of the Internal Revenue Code. In
addition, all stock options and restricted stock granted to Messrs. Bolton
and/or Wadsworth shall become fully vested and exercisable in accordance with
the terms on the termination date. Alternatively, Messrs. Bolton and/or
Wadsworth may elect to receive an amount in cash equal to the greater of (i) the
in-the-money value of the shares covered by all such options or (ii) the
difference between the highest per share price for shares of MAA paid in
connection with the change of control and the per share exercise price of the
options held by them, multiplied by the number of shares covered by all such
options. Finally, MAA will pay Messrs. Bolton and/or Wadsworth all legal fees
incurred by them in connection with the change of control.
Each
employment agreement also contains confidentiality and non-competition
provisions, as well as the agreement of Messrs. Bolton and Wadsworth not to have
an interest in a competitor either as an owner or an employee within 5 miles of
a property owned by MAA at the time of a change of control termination for the
period of two years.
A copy of the employment agreements are
set forth on Exhibit 10.1 and Exhibit 10.2 to this Current Report on Form 8-K
and incorporated herein by reference.
Also on
December 5, 2008, each of Albert M. Campbell, III, Executive Vice President and
Treasurer of MAA, Thomas L. Grimes, Jr., Executive Vice President and Director
of Property Management Operations of MAA, and James Andrew Taylor, Executive
Vice President and Director of Asset Management of MAA entered into an amended
and restated change of control contract with MAA as approved by the Compensation
Committee of the Board of Directors of MAA. Each original change of control
contract was entered into in December of 1999. Each contract was amended to
bring them in compliance with Section 409A of the Internal Revenue
Code.
Each
change of control contract provided in the event of a change of control
termination, Messrs. Campbell, Grimes and/or Taylor, are entitled to receive a
payment equal to the sum of two and 99/100 (2.99) times their annual base salary
in effect on the date of termination plus two and 99/100 (2.99) times their
average annual cash bonus paid during the two immediately preceding fiscal
years. To the extent that an excise tax on excess parachute payments
will be imposed on Messrs. Campbell, Grimes and/or Taylor under Section 4999 of
the Internal Revenue Code as a result of such payment, MAA shall pay them an
additional amount sufficient to reimburse them for taxes imposed pursuant to
Sections 280G and 4999 of the Internal Revenue Code. In addition, all stock
options and restricted stock granted to Messrs. Campbell, Grimes and/or Taylor
shall become fully vested and exercisable in accordance with the terms on the
termination date. Alternatively, Messrs. Campbell, Grimes and/or Taylor may
elect to receive an amount in cash equal to the greater of (i) the in-the-money
value of the shares covered by all such options or (ii) the difference between
the highest per share price for shares of MAA paid in connection with the change
of control and the per share exercise price of the options held by them,
multiplied by the number of shares covered by all such options. Finally, MAA
will pay Messrs. Campbell, Grimes and/or Taylor all legal fees incurred by them
in connection with the change of control. The change of control contracts also
attest that Messrs. Campbell, Grimes and/or Taylor may not have an interest in a
competitor either as an owner or an employee within 5 miles of a property owned
by MAA at the time of a change of control termination for the period of two
years.
A copy of the change of control
contracts are set forth on Exhibit 10.3, Exhibit 10.4, and Exhibit 10.5 to this
Current Report on Form 8-K and incorporated herein by reference.
ITEM
9.01 Financial
Statements and Exhibits
(c) Exhibits
Exhibit
Number
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Description
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10.1
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Employment Agreement for H. Eric Bolton,
Jr.
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10.2
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Employment Agreement for Simon R.C.
Wadsworth
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10.3
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Change of Control Contract for Albert M. Campbell,
III
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10.4
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Change of Control Contract for Thomas L. Grimes,
Jr.
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10.5
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Change of Control Contract for James Andrew
Taylor
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10.6
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Form of Change of Control
Contract
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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MID-AMERICA APARTMENT
COMMUNITIES, INC.
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Date:
December 5, 2008
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/s/Simon
R.C. Wadsworth
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Simon
R.C. Wadsworth
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Executive
Vice President and Chief Financial Officer
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(Principal Financial and
Accounting Officer)
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