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): May 11, 2011
CAMDEN PROPERTY TRUST
(Exact name of registrant as specified in its charter)
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Texas
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1-12110
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76-6088377
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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Three Greenway Plaza, Suite 1300,
Houston, Texas
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77046
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(Address of principal executive offices)
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(Zip Code)
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Registrants telephone number, including area code:
(713) 354-2500
Not applicable
(Former name or former address, if changed since last report.)
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:
o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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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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o
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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 or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers
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On May 11, 2011, Camden Property Trust (the Company) held its 2011 Annual Meeting of
Shareholders (the Annual Meeting). At the Annual Meeting, shareholders of the Company approved
the Camden Property Trust 2011 Share Incentive Plan (the 2011 Plan). The 2011 Plan includes an
authorization to issue up to 9,144,489 common shares (5,840,000 newly authorized common shares plus
3,304,489 common shares available for grant under the Companys 2002 Share Incentive Plan (the
2002 Plan)), pursuant to awards under the 2011 Plan. The 2011 Plan provides for various types of
equity awards to trust managers, executive and other officers and key employees. The types of
awards which may be granted under the 2011 Plan include incentive share options, nonqualified share
options, rights (which may be granted separately or in connection with an option), share awards,
dividends and dividend equivalents and other share awards. The 2011 Plan will expire on May 11,
2021. As of the date hereof, there have been no awards, and therefore no amounts are payable under
the 2011 Plan to the principal executive officer, the principal financial officer or any named
executive officer of the Company.
Attached hereto as Exhibit 99.1 is the 2011 Plan. A brief description of the 2011 Plan is
included as part of the Companys Proxy Statement for the 2011 Annual Meeting of Shareholders (the
Proxy Statement), which was filed with the Securities and Exchange Commission on March 22, 2011.
The descriptions of the 2011 Plan contained herein and in the Proxy Statement are qualified in
their entirety by reference to the full text of the 2011 Plan.
The 2002 Plan provided for the same types of equity awards as the 2011 Plan. Effective as of
the close of business on May 11, 2011, and as result of approval of the 2011 Plan, no new awards
will be granted under the 2002 Plan. Outstanding awards previously granted under the 2002 Plan
will not be affected, and the terms of the 2002 Plan shall continue to govern such previously
granted awards.
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Item 5.07
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Submission of Matters to a Vote of Security Holders
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At the Annual Meeting, there were 69,972,511 common shares entitled to be voted; 65,471,144
shares were voted in person or by proxy. The Companys shareholders voted on the following matters
at the Annual Meeting:
1. Election of the nine trust managers nominated by the Board of Trust Managers to hold office
for a one-year term;
2. Ratification of the selection of Deloitte & Touche LLP as the Companys independent
registered public accounting firm for fiscal year 2011;
3. Approval of a change in the Companys state of formation from Texas to Maryland;
4. Approval of the 2011 Plan;
2
5. On an advisory basis, approval of the executive compensation disclosed in the Proxy
Statement;
6. On an advisory basis, the frequency of the advisory vote on executive compensation.
The results of the shareholder votes are set forth below:
Board of Trust Managers
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Affirmative
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Withheld
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Richard J. Campo
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61,225,092
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1,038,870
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Scott S. Ingraham
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61,907,845
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356,117
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Lewis A. Levey
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61,965,601
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298,361
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William B. McGuire, Jr.
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62,188,852
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75,110
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D. Keith Oden
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61,966,562
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297,400
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F. Gardner Parker
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54,500,486
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7,763,476
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William F. Paulsen
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59,092,688
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3,171,274
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Steven A. Webster
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53,165,659
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9,098,303
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Kelvin R. Westbrook
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61,641,686
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622,276
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There were 3,207,182 broker non-votes with respect to the election of trust managers.
Independent Registered Public Accounting Firm
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Affirmative
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Negative
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Abstentions
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65,321,496
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95,573
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54,075
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Change in State of Formation from Texas to Maryland
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Affirmative
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Negative
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Abstentions
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Broker Non-Votes
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19,341,052
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42,890,393
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32,517
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3,207,182
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2011 Plan
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Affirmative
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Negative
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Abstentions
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Broker Non-Votes
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45,402,534
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16,767,509
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93,919
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3,207,182
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Approval, on an Advisory Basis, of Executive Compensation
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Affirmative
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Negative
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Abstentions
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Broker Non-Votes
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58,969,490
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3,062,285
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232,187
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3,207,182
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3
Advisory Vote on Frequency of Advisory Vote on Executive Compensation
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One Year
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Two Years
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Three Years
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Abstentions
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Broker Non-Votes
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55,971,646
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220,064
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6,011,650
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60,602
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3,207,182
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Item 9.01 Financial Statements and Exhibits
(c) Exhibits
The Exhibits to this Report are listed on the Exhibit Index attached hereto.
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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 hereunto duly authorized.
Date: May 12, 2011
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CAMDEN PROPERTY TRUST
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By:
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/s/ Michael P. Gallagher
Michael P. Gallagher
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Vice President Chief Accounting Officer
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5
EXHIBIT INDEX
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Exhibit
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Number
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Title
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99.1
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Camden Property Trust 2011 Share Incentive Plan
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6
Exhibit 99.1
2011 SHARE INCENTIVE PLAN
OF
CAMDEN PROPERTY TRUST
1. Purpose.
The purpose of this Plan is to benefit the Companys shareholders by encouraging high levels
of performance by individuals who are key to the success of the Company and to enable the Company
to attract, motivate and retain talented and experienced individuals essential to its continued
success. This is to be accomplished by providing such individuals an opportunity to obtain or
increase their proprietary interest in the Companys performance and by providing such individuals
with additional incentives to remain with the Company.
2. Definitions.
The following terms, as used herein, shall have the meaning specified:
(a) 2002 Plan shall have the meaning set forth in Section 5(a).
(b) Affiliate shall mean any corporation or other entity more than 50% of whose stock or
other interests having general voting power is owned by the Company or by another Affiliate of the
Company.
(c) Alternative Rights shall have the meaning set forth in Section 6(a)(2).
(d) Award shall mean an award granted pursuant to Section 6 payable in cash or Shares.
(e) Board shall mean the Board of Trust Managers or Directors of the Company, as it may be
comprised from time to time.
(f) Cause shall have the meaning set forth in Section 6(b)(4)(ii).
(g) Change in Control shall mean the first to occur of any of the following:
(1) any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
(other than the Company, any trustee or other fiduciary holding securities under an employee
benefit plan of the Company, or any company owned, directly or indirectly, by the
shareholders of the Company in substantially the same proportions as their ownership of
Shares in the Company) together with its affiliates and associates (as such terms are
defined in Rule 12b-2 of the Exchange Act) becomes the beneficial owner (as defined in
Rule 13d-3 under the Exchange Act), or has become the beneficial owner during the most
recent twelve-month period ending on the date of the most recent acquisition by such person,
directly or indirectly, of securities of the Company representing 40% or more of the
combined voting power of the Companys then
outstanding securities; provided, that, the acquisition of additional control by any
person who is considered to effectively control the Company shall not be considered a Change
in Control; or
(2) during any 12-month period, the Directors in office at the beginning of such period
shall have ceased to constitute a majority of the Board without the approval of the
nomination of the individuals who replace them on the Board by two-thirds of the Board
consisting of Directors who were serving at the beginning of such period; or
(3) a merger or consolidation of the Company shall have been consummated, other than
(i) a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving entity) more than
50% of the combined voting power of the voting securities of the Company (or such surviving
entity) outstanding immediately after such merger or consolidation or (ii) a merger or
consolidation effected to implement a recapitalization of the Company (or similar
transaction) in which no person (as hereinabove defined) acquires more than 30% of the
combined voting power of the Companys then outstanding securities; or
(4) a plan of complete liquidation of the Company shall have been consummated; or
(5) any person or persons, other than a subsidiary of the Company, shall have acquired
all or a significant portion of the Companys assets. For purposes of this clause (5), the
term shall have acquired all or a significant portion of the Companys assets shall mean a
sale or other disposition transaction or series of related transactions involving assets of
the Company or any subsidiary of the Company (including the stock of any subsidiary of the
Company) in which the value of the assets or stock being sold or otherwise disposed of (as
measured by the purchase price being paid therefore or by such other method as the Board
determines is appropriate in a case where there is no readily ascertainable purchase price)
constitutes more than 33
1
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% of the aggregate market value of the outstanding Shares (on a
fully diluted basis) plus the aggregate market value of the Companys other outstanding
equity securities. The aggregate market value of the Shares shall be determined by
multiplying the number of Shares (on a fully diluted basis) outstanding on the date of the
execution and delivery of a definitive agreement with respect to the transaction or series
of related transactions by the average closing price of the Shares for the ten trading days
immediately preceding such date. The aggregate market value of any other equity securities
of the Company shall be determined in a manner similar to that prescribed in the immediately
preceding sentence for determining the aggregate market value of the Shares or by such other
method as the Board shall determine is appropriate.
Notwithstanding the foregoing, (except as provided otherwise in an Award) a Change in
Control shall not be deemed to have occurred if, prior to the time a Change in Control would
otherwise be deemed to have occurred pursuant to the above provisions, the Board determines
otherwise.
2
(h) Code shall mean the Internal Revenue Code of 1986, as amended from time to time.
(i) Committee shall mean a committee appointed pursuant to Section 3(a) or, if no such
Committee is appointed, the Board.
(j) Company shall mean Camden Property Trust and its successors.
(k) Director shall mean any person who shall from time to time be a member of the Board
and/or a member of the board of directors of any Affiliate.
(l) Dividend Equivalent Right shall mean an Award granted pursuant to Section 6(e).
(m) Effective Date shall mean May 11, 2011; provided that this Plan shall not become
effective unless and until it is approved by the requisite percentage of the holders of the Shares.
(n) Election Date shall mean the date an Independent Director is first appointed or elected
to the Board.
(o) Exchange Act shall mean the Securities Exchange Act of 1934, as amended from time to
time.
(p) Fair Market Value shall mean the closing price of the relevant security as reported on
the composite tape of New York Stock Exchange issues on the determination date. If no sale of the
security is reported for such date, but there were shares traded on dates within a reasonable
period before the date of determination, the Fair Market Value shall be closing price of a share of
the relevant security on the most recent date before the date of determination. If the relevant
security is not publicly traded, Fair Market Value shall be determined by the Committee in good
faith on such basis as it deems appropriate, in accordance with Code Section 409A. The Committees
determination of Fair Market Value shall be conclusive and binding on all persons.
(q) Full-Value Award means an Award other than an Option, Right or other Award that does not
deliver the full value at grant thereof of the underlying Shares.
(r) Fungible Pool Unit shall be the measuring unit used for purposes of this Plan, as
specified in Section 5, to determine the number of Shares which may be subject to Awards hereunder,
which shall consist of Shares in the proportions ranging from 0.83 to 3.45, as set forth in Section
5.
(s) Independent Director shall mean any Director who is (i) (A) a non-employee director
within the meaning of Rule 16b-3(b)(3)(i) of the Exchange Act, and (B) an outside director within
the meaning of Code Section 162(m) and the regulations promulgated thereunder, and (ii) who is not
an employee of the Company or any Affiliate; provided, that a Director who is a consultant but is
not an employee, also may be an Independent Director if the limitations on remuneration set forth
in Code Section 162(m) and the regulations promulgated thereunder are otherwise met so that the
Director satisfies the requirements to be an outside
director within the meaning of Code Section 162(m) and the regulations promulgated
thereunder.
3
(t) Insider shall mean any person who is subject to Section 16.
(u) ISO shall mean an incentive stock option within the meaning of Code Section 422.
(v) Limited Rights shall have the meaning set forth in Section 6(d).
(w) Mature Shares shall mean, with respect to an exercise date, Shares held by a Participant
for at least six months prior to such exercise date.
(x) NQO shall mean a stock option that is not within the meaning of Code Section 422.
(y) Option shall mean any option granted pursuant to Section 6(a)(1).
(z) Participant shall mean any person who has been granted an Award pursuant to this Plan.
(aa) Performance Units shall have the meaning set forth in Section 6(c).
(bb) Permanent Disability shall have the meaning set forth in Section 6(a)(5)(i).
(cc) Restricted Shares shall mean the Shares issued as a result of a Restricted Share Award.
(dd) Restricted Share Award shall mean a grant of the right to purchase Shares pursuant to
Section 6(b). Such Shares, when and if issued, shall be subject to such transfer restrictions and
risk of forfeiture as the Committee shall determine at the time the Award is granted, until such
specific conditions are met. Such conditions may be based on continuing employment or achievement
of pre-established performance objectives, or both.
(ee) Retirement shall have the meaning set forth in Section 6(a)(5)(i).
(ff) Rights shall mean an Award granted pursuant to Section 6(a)(2).
(gg) Section 16 shall mean Section 16 of the Exchange Act or any successor regulation and
the rules promulgated thereunder by the Securities and Exchange Commission, as they may be amended
from time to time.
(hh) Shares shall mean the common shares of the Company, par value $.01 per share.
(ii) Spread shall mean (i) with respect to Alternative Rights, the excess of the Fair Market
Value of one Share on the date of exercise of such Rights over the purchase price per Share payable
under the related Option, and (ii) with respect to Rights not granted in connection
with an Option, the excess of the Fair Market Value of one Share on the date of exercise of
such Rights over the Fair Market Value of one Share on the date such Rights were granted.
4
(jj) Year of Service shall mean each 12 consecutive month period commencing on an Employees
employment commencement date and ending on each anniversary of the Employees employment
commencement date.
3. Administration and Interpretation
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(a)
Administration
. This Plan shall be administered by a Committee, which shall
consist of two or more Independent Directors. The Board may from time to time remove and appoint
members of the Committee in substitution for, or in addition to, members previously appointed and
may fill vacancies, however caused, in the Committee. The Committee may prescribe, amend and
rescind rules and regulations for administration of this Plan and shall have full power and
authority to construe and interpret this Plan. A majority of the members of the Committee shall
constitute a quorum, and the act of a majority of the members present at a meeting or the acts of a
majority of the members evidenced in writing shall be the acts of the Committee. The Committee may
correct any defect or any omission or reconcile any inconsistency in this Plan or in any Award or
grant made hereunder in the manner and to the extent it shall deem desirable.
The Committee shall have the full and exclusive right to grant all Awards under this Plan. In
granting Awards, the Committee shall take into consideration the contribution the individual has
made or may make to the success of the Company or its Affiliates and such other factors as the
Committee shall determine. The Committee shall periodically determine the Participants in this
Plan and the nature, amount, pricing, time and other terms of Awards to be made to such
individuals, subject to the other terms and provisions of this Plan. The Committee shall also have
the authority to consult with and receive recommendations from officers and other individuals of
the Company and its Affiliates with regard to these matters. In no event shall any individual, his
or her legal representative, heirs, legatees, distributees or successors have any right to
participate in this Plan except to such extent, if any, as the Committee shall determine.
The Committee may from time to time in granting Awards under this Plan prescribe such other
terms and conditions concerning such Awards as it deems appropriate, including, without limitation,
the achievement of specific goals established by the Committee, provided that such terms and
conditions are not more favorable to any individual than those expressly set forth in this Plan.
The Committee may delegate to the officers of or individuals associated with the Company the
authority to execute and deliver such instruments and documents, to do all such acts and things,
and to take all such other steps deemed necessary, advisable or convenient for the effective
administration of this Plan in accordance with its terms and purpose, except that the Committee may
not delegate any discretionary authority with respect to substantive decisions or functions
regarding this Plan or Awards hereunder as these relate to Insiders, including but not limited to
decisions regarding the timing, eligibility, pricing, amount or other material term of such Awards.
5
(b)
Interpretation
. The Committee shall have the power to interpret and administer
this Plan. All questions of interpretation with respect to this Plan, the number of Shares or
other security granted hereunder, and the terms of any Award shall be determined by the Committee
and its determination shall be final and conclusive upon all parties in interest. In the event of
any conflict between an Award and this Plan, the terms of this Plan shall govern. It is the intent
of the Company that this Plan and Awards hereunder satisfy and be interpreted in a manner that, in
the case of Participants who are or may be Insiders, satisfies the applicable requirements of Rule
6b-3 of the Exchange Act, so that such persons will be entitled to the benefits of Rule 16b-3 or
other exemptive rules under Section 16 and will not be subjected to liability thereunder. If any
provision of this Plan or of any Award would otherwise frustrate or conflict with the intent
expressed in this Section 3(b), that provision to the extent possible shall be interpreted and
deemed amended so as to avoid such conflict. To the extent of any remaining irreconcilable
conflict with such intent, the provision shall be deemed void as applicable to insiders.
It is the intention of the Company that this Plan and all Awards issued under this Plan be
interpreted and administered consistent with the provisions of Code Section 409A and the Treasury
Regulations issued thereunder, including the exemptions from application of Section 409A available
thereunder. Except to the extent that Section 6(h) applies to an Award, it is the intention of the
Company that no Award shall be deferred compensation subject to Code Section 409A unless and to
the extent that the Committee specifically determines otherwise, and this Plan and the terms and
conditions of all Awards shall be interpreted accordingly. Notwithstanding any provision of this
Plan to the contrary, in the event that the Committee determines that any Award may be subject to
Code Section 409A, the Committee may adopt such amendment to this Plan and the applicable Award
agreement or adopt other policies and procedures (including amendments, policies and procedures
with retroactive effect), or take any other actions that the Committee determines are necessary or
appropriate to (1) exempt the Award from Code Section 409A and/or preserve the intended tax
treatment of the benefits provided with respect to the Award or (2) comply with the requirements of
Code Section 409A.
(c)
Limitation on Liability
. Neither the Committee nor any member thereof shall be
liable for any act, omission, interpretation, construction or determination made in connection with
this Plan in good faith, and the members of the Committee shall be entitled to indemnification and
reimbursement by the Company in respect of any claim, loss, damage or expense (including counsel
fees) arising therefrom to the full extent permitted by law. The members of the Committee shall be
named as insureds under any directors and officers (or similar) liability insurance coverage which
the Company may have in effect from time to time.
4. Eligibility.
The class of persons who are potential recipients of Awards granted under this Plan consist of
the (i) Independent Directors, (ii) key employees of the Company or any Affiliate and (iii)
consultants to the Company or any Affiliate, in each case (other than in the case of clause (i)),
as determined by the Committee from time to time. The Independent Directors, key employees and
consultants to whom Awards are granted under this Plan, and the number of Shares or other security
subject to each such Award, shall be determined by the Committee in its sole discretion, subject,
however, to the terms and conditions of this Plan. Persons to whom Awards may be granted include
key employees and consultants who are also Directors.
6
5. Shares Subject to Grants Under this Plan.
(a)
Limitation on Number of Shares
. The Shares subject to grants of Awards shall be
authorized but unissued Shares, Shares purchased in the open market or privately and such Shares,
if any, held as treasury stock by the Company. Subject to adjustments as provided in Section 7,
the total number of Shares subject to Awards granted under this Plan, in the aggregate, may not
exceed the sum of the following (collectively, the Fungible Pool Limit): (i) 5,840,000 and (ii)
3,304,489, which represents the number of Shares available under the Companys Amended and Restated
2002 Share Incentive Plan (the 2002 Plan) as of the Effective Date pursuant to Full-Value Awards
based on a 3.45 to 1.0 Fungible Pool Unit-to-Full-Value award conversion ratio, of which 100% may
be issued as ISOs. Each Share issued or to be issued in connection with any Full-Value Awards
shall be counted against the Fungible Pool Limit as 3.45 Fungible Pool Units. Options and other
Awards that do not deliver the full value at grant thereof of the underlying Shares and that expire
more than five years from the date of grant shall be counted against the Fungible Pool Limit as one
Fungible Pool Unit. Options, Rights and other Awards that do not deliver the full value at grant
thereof of the underlying Shares and that expire five years or less from the date of grant shall be
counted against the Fungible Pool Limit as 0.83 of a Fungible Pool Unit. (For these purposes, the
number of Shares taken into account with respect to a Right shall be the number of Shares
underlying the Rights at grant (
i.e
., not the final number of Shares delivered upon exercise of the
Rights).) Subject to adjustment as provided in Section 7, the aggregate number of Shares as to
which Awards may be granted to a participant during a calendar year under this Plan shall not
exceed 1,000,000 Shares (with each Share subject to an Award being counted as one Share,
notwithstanding the type of Award or the fact that it may count as more or less than one Fungible
Pool Unit for purposes of this Section 5(a)), it being expressly contemplated that Awards in
exclusively one category (
e.
g., Options) can (but need not) be used in the discretion of the
Committee to reach the limitation set forth in this sentence; provided that this limit shall only
apply to Awards that are intended to qualify as performance-based compensation under Code Section
162(m) and the regulations promulgated thereunder.
(b) Shares ceasing to be subject to an Award because of the exercise of an Option or Right or
the vesting of an Award shall no longer be subject to any further grant under this Plan. However,
if any outstanding Option or Right (including any outstanding award under the 2002 Plan), in whole
or in part, expires or terminates unexercised or is canceled or if any Award, in whole or in part,
expires or is terminated or forfeited, or is paid in cash in lieu of Shares, for any reason prior
to May 11, 2021, the Shares allocable to the unexercised, terminated, canceled or forfeited portion
of such Award, or Awards that use Shares as a reference but that are paid or settled in cash, may
again be made the subject of grants under this Plan; provided, however, that, with respect to any
Option or Rights granted to any Participant who is a covered employee as defined in Code Section
162(m) and the regulations promulgated thereunder that is canceled, the number of Shares subject to
such Option and/or Rights shall continue to count against the maximum number of Shares which may be
the subject of Options and for Rights granted to such Participant.
7
6. Awards.
(a)
Options and Rights
.
(1)
Grants of Options
. Options granted under this Plan may be either ISOs or
NQOs. At the time an Option is granted, the Committee may, in its discretion, designate
whether an Option shall be an ISO. No Option which is intended to qualify as an ISO shall
be granted under this Plan to any individual who, at the time of such grant, is not an
employee of the Company or a parent corporation or subsidiary corporation of the
Company, as such terms are defined in Code Sections 424(e) and 424(f) respectively.
Notwithstanding any other provision of this Plan to the contrary, to the extent that
the aggregate Fair Market Value (determined at the date an Option is granted) of the Shares
with respect to which an Option intended to be an ISO (and any other ISO granted to the
holder under this Plan or any other plans of the Company or an Affiliate) first becomes
exercisable during any calendar year exceeds $100,000, the portion of such Option which
would exceed the $100,000 limitation shall be treated as an NQO. Options with respect to
which no designation is made by the Committee shall be deemed to be ISOs to the extent that
the $100,000 limitation described in the preceding sentence is met. This paragraph shall be
applied by taking Options into account in the order in which they are granted.
No ISO shall be granted to any person who, at the time of the grant, owns Shares
possessing more than 10% of the total combined voting power of the Company or any Affiliate,
unless (i) on the date such ISO is granted, the Option price is at least 110% of the Fair
Market Value per Share subject to the ISO and (ii) such ISO by its terms is not exercisable
after the expiration of five years from the date such ISO is granted.
The purchase price per Share pursuant to the exercise of any Option shall be fixed by
the Committee at the time of grant; provided, however, that the purchase price per Share
(regardless of whether such Option is an ISO or an NQO) shall not be less than the Fair
Market Value of a Share on the date on which the Option is granted. In addition, the
Committee shall designate the number of Shares, the terms and conditions (which may include,
without limitation, the achievement of specific goals), with respect to Options granted
under this Plan. Options may be granted by the Committee to any eligible person at any time
and from time to time.
The form of Option shall be as determined from time to time by the Committee. A
certificate of Option signed by the Chairman of the Board or the President or Vice President
and attested by the Treasurer or an Assistant Treasurer or Secretary or an Assistant
Secretary of the Company shall be delivered to each person to whom Options are granted.
(2)
Grants of Rights
. The Committee shall have the authority in its discretion
to grant to any eligible person Rights, which may be granted separately or in connection
with an Option at the time of grant.
8
If Rights are granted in connection with an Option, such Rights shall be granted with
respect to the same number of Shares then covered by the Option and may be exercised solely
as an alternative to the exercise of the related Option. Rights granted in connection with
an Option that entitle the holder thereof to receive payment from the
Company only if, and to the extent that, the related Option is exercisable, by
surrendering the Option with respect to the number of Shares as to which such Rights are
then exercised are referred to herein as Alternative Rights. Notwithstanding the
preceding sentence, any Alternative Rights that relate to an ISO may be exercised only at
such times that there is a positive Spread. Upon any exercise of Alternative Rights, the
holder thereof shall be entitled to receive payment of an amount equal to the product
obtained by multiplying (i) the Spread, or such percentage or portion of the Spread as shall
be determined by the Committee at the time of grant, by (ii) the number of Shares in respect
of which the Alternative Rights shall have then been so exercised.
Rights granted without relationship to an Option shall be exercisable at such rate as
determined by the Committee. Such Rights shall entitle the holder, upon the exercise
thereof, to receive payment from the Company of an amount equal to the product obtained by
multiplying (i) the Spread, or such percentage or portion of the Spread as shall be
determined by the Committee at the time of grant, by (ii) the number of Shares in respect of
which the Rights shall have then been so exercised.
Notwithstanding anything contained herein, the Committee may, in its sole discretion,
limit the amount payable upon the exercise of Rights. Any such limitation shall be
determined as of the date of grant and noted on the certificate evidencing the grant of the
Rights. The Committee may not, at any time, provide that the amount payable upon the
exercise of Rights will be greater than the Spread.
Payment of the amount determined hereunder upon the exercise of any Rights shall be
made solely in cash, or solely in Shares valued at their Fair Market Value on the date of
exercise of the Rights, or in a combination thereof, as the holder may elect, provided that
any election by the holder shall be subject to approval by the Committee. No fractional
Shares shall be issued by the Company, and settlement therefor shall be made in cash.
The form of Rights shall be as determined from time to time by the Committee. A
certificate of Rights signed by the Chairman of the Board or the President or a Vice
President and attested by the Treasurer or an Assistant Treasurer, or Secretary or an
Assistant Secretary, of the Company shall be delivered to each person to whom Rights are
granted.
The Committee may fix such waiting periods, exercise dates or other limitations as it
shall deem appropriate with respect to Rights granted under this Plan, including, without
limitation, the achievement of specific goals; provided, however, that each Right granted
hereunder shall be exercisable only upon consent of the Committee.
9
(3)
Payment of Option Exercise Price
. Upon exercise of an Option, the full
Option purchase price for the Shares with respect to which the Option is being exercised
shall be payable to the Company, (i) in cash or by a check payable and acceptable to the
Company or (ii) subject to the approval of the Committee, by tendering to the Company Shares
owned by the holder for at least six months having an aggregate Fair Market Value per Share
as of the date of exercise and tender which is not greater than the full
Option purchase price for the Shares with respect to which the Option is being
exercised and by paying the remainder of the Option purchase price as provided in (i) above;
however, the Committee may, upon confirming that the holder owns the number of additional
Shares being tendered, authorize the issuance of a new certificate for the number of Shares
being acquired pursuant to the exercise of the Option less the number of Shares being
tendered upon the exercise and return to the holder (or not require surrender of) the
certificate for the Shares being tendered upon the exercise. Notwithstanding the preceding,
a holder may not use any Shares acquired pursuant to an Award granted under this Plan (or
any other plan maintained by the Company or any Affiliate) unless the holder has
beneficially owned such Shares for at least six months. Payment instruments will be
received subject to collection. In addition to the foregoing methods of payment, the full
Option purchase price for Shares with respect to which the Option is being exercised may be
payable to the Company by such other methods as the Committee may permit from time to time.
(4)
Term
. The term of each Option and Right shall be determined by the
Committee at the date of grant; provided, however, that each Option that is an ISO shall,
notwithstanding anything in this Plan to the contrary, expire not more than ten years from
the date the Option is granted (or five years from the date of grant to the extent required
under Section 6(a)(1)) or, if earlier, the date specified in the certificate evidencing the
grant of such Option. An Option that is an NQO shall expire not more than ten years from
the date the Option is granted, or if earlier, the date specified in the certificate
evidencing the grant of such Option. A Right not granted in connection with an Option shall
expire not more than ten years from the date the Right is granted or, if earlier, the date
specified in the certificate evidencing the grant of the Right. The term of an Option or
Right may not be extended after the date of grant, except as may be permitted under Treasury
Regulation Section 1.409A-1(b)(5)(v)(C)(1).
(5)
Termination of Employment or Relationship
.
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(i)
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In the event that a Participants employment or
relationship with the Company and its Affiliates shall terminate for
any reason other than as a result of (A) retirement pursuant to a
retirement plan or policy of the Company or one of its Affiliates
(Retirement), (B) permanent disability as determined by the Committee
based on the opinion of a physician selected or approved by the
Committee (Permanent Disability), or (C) death, the Participants
NQOs and Rights shall be exercisable by him or her, subject to
subsection (4) above, only within three months after such termination,
but only to the extent the Option or Right was exercisable immediately
prior to such termination. In the case of a Participants Retirement,
Permanent Disability or death while entitled to exercise a NQO or
Right, the Participant or, if applicable, the Participants estate,
personal representative or beneficiary, as the case may be, shall have
the right, subject to the provisions of subsection (4) above, to
exercise the NQO or Rights at any time within one year from the date of
the Participants Retirement, Permanent Disability or death.
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10
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(ii)
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In the event that a Participants employment or
relationship with the Company and its Affiliates shall terminate for
any reason other than as a result of (A) Permanent Disability or (B)
death, the Participants ISOs shall be exercisable by him or her,
subject to subsection (4) above, only within three months after such
termination, but only to the extent the ISO was exercisable immediately
prior to such termination. In the case of a Participants Permanent
Disability or death while entitled to exercise an ISO, the Participant
or, if applicable, the Participants estate, personal representative or
beneficiary, as the case may be, shall have the right, subject to the
provisions of subsection (4) above, to exercise the ISO at any time
within one year from the date of the Participants Permanent Disability
or death.
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(iii)
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If the employment, consulting arrangement or
service of any Participant with the Company or an Affiliate shall be
terminated by the Company or an Affiliate for Cause, all unexercised
Options and Rights of such Participant shall terminate immediately upon
such termination of such Participants employment, consulting
arrangement or service with the Company and all Affiliates, and a
Participant whose employment, consulting arrangement or service with
the Company and Affiliates is so terminated, shall have no right after
such termination to exercise any unexercised Option or Rights he or she
might have exercised prior to termination of his or her employment,
consulting arrangement or service with the Company and Affiliates.
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(6)
Options Granted by Other Corporations
. Options may be granted under this
Plan from time to time in substitution for stock options held by employees and directors of
corporations who become key employees or Directors or directors of the Company or of any
Affiliate as a result of any corporate transaction as defined in the Treasury Regulations
promulgated under Code Section 424, provided, however, as follows: (i) any such adjustments
to Awards that are considered deferred compensation within the meaning of Code Section
409A shall be made in compliance with the requirements of Code Section 409A unless the
Participant consents otherwise; (ii) any such adjustments to Awards that are not considered
deferred compensation subject to Code Section 409A shall be made in such a manner as to
ensure that after such adjustment, the Awards either continue not to be subject to Code
Section 409A or comply with the requirements of Code Section 409A unless the Participant
consents otherwise; and (iii) the Committee shall not have the authority to make any
adjustments under this Section to the extent that the existence of such authority would
cause an Award that is not intended to be subject to Code Section 409A to be subject
thereto.
11
(7)
Issuance of Restricted Shares
. Notwithstanding the preceding subsections,
the Committee may, in its sole discretion and without the requirement of consent from the
Participant, determine that an Option shall be settled, upon exercise, in whole or in part
by the issuance of Restricted Shares to the Participant. Any such determination shall
be made no later than the date of grant and shall be noted on the certificate
evidencing the grant of the Option. The restricted period under such Restricted Shares shall
be no greater than five years.
(b)
Restricted Share Awards
.
(1)
Awards of Restricted Shares
. Restricted Share Awards may be awarded by the
Committee to any individual eligible to receive the same, at any time and from time to time
before May 11, 2021. In addition, and without limiting the generality of the foregoing, the
Committee shall grant to any individual who is entitled to receive a bonus under the
Companys cash bonus incentive plan, a Restricted Share Award with respect to Shares having
a Fair Market Value on the date of the grant of such Restricted Share Award equal to a
specified percentage determined by the Committee of the amount of such individuals bonus,
provided that such individual has made an irrevocable election, at least six months prior to
the end of the designated performance period to which the bonus is attributable, to receive
such Restricted Share Award in lieu of such bonus. In the first year of a Participants
eligibility to participate in this Plan, such an election may be made no later than 30 days
following the date on which the Participant becomes eligible to participate in this Plan and
shall be applicable to the portion of the bonus attributable to services performed after the
election is made.
(2)
Purchase Price under Restricted Share Awards
. The purchase price of
Restricted Shares to be purchased pursuant to a Restricted Share Award shall be fixed by the
Committee at the time of the grant of the Restricted Share Award; provided, however, that
such purchase price shall not be less than the par value per Share of the Shares subject to
the Restricted Share Award. The Committee shall specify, within its discretion, the time
and manner in which payment of such purchase price shall be paid.
(3)
Description of Restricted Shares
. All Restricted Shares purchased by an
eligible person shall be subject to the following conditions:
(i) Restricted Shares shall be subject to such restrictions, terms and
conditions as the Committee may establish, which may include, without limitation,
lapse and non-lapse restrictions (as such terms are defined in regulations
promulgated under Code Section 83) and the achievement of specific performance
goals;
(ii) the Restricted Shares may not be sold, exchanged, pledged, transferred,
assigned or otherwise encumbered or disposed of until the terms and conditions set
by the Committee at the time of the grant of the Restricted Share Award have been
satisfied;
12
(iii) each certificate representing Restricted Shares issued pursuant to this
Plan shall bear a legend making appropriate reference to the following:
the Shares represented by this certificate have been issued pursuant to the
terms of the 2011 Share Incentive Plan of Camden Property Trust and may not
be sold, pledged, transferred, assigned or otherwise encumbered in any
manner except as is set forth in the terms of such award dated
; and
(iv) except as set forth in Sections 6(a)(7) and 8, no Restricted Shares
granted pursuant to this Plan shall be subject to vesting requirements over a period
of less than three years.
If a certificate representing Restricted Shares is issued to an individual (whether or
not escrowed as provided below), the individual shall be the record owner of such Shares and
shall have all the rights of a shareholder with respect to such Shares (unless the
Restricted Share Award specifically provides otherwise), including the right to vote and the
right to receive dividends or other dividends made or paid with respect to such Shares.
In order to enforce the restrictions, terms and conditions that may be applicable to a
Participants Restricted Shares, the Committee may require the Participant, upon the receipt
of a certificate or certificates representing such Shares, or at any time thereafter, to
deposit such certificate or certificates, together with stock powers and other instruments
of transfer, appropriately endorsed in blank, with the Company or an escrow agent designated
by the Company under an escrow agreement, which may be a part of a Restricted Share Award,
in such form as shall be determined by the Committee.
After the satisfaction of the terms and conditions set by the Committee with respect to
Restricted Shares issued to an individual, and provided the Restricted Shares are not
subject to a non-lapse restriction, a new certificate, without the legend set forth above,
for the number of Shares that are no longer subject to such restrictions, terms and
conditions shall be delivered to the individual. If such terms and conditions are satisfied
as to a portion, but fewer than all, of such Shares, the remaining Shares issued with
respect to such Award shall either be reacquired by the Company or, if appropriate under the
terms of the award applicable to such Shares, shall continue to be subject to the
restrictions, terms and conditions set by the Committee at the time of Award.
(4)
Termination of Employment or Relationship
.
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(i)
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General
. If the employment or
relationship with the Company or its Affiliates of a holder of a
Restricted Share Award is terminated for any reason before satisfaction
of the terms and conditions for the vesting (within the meaning of Code
Section 83) of all Shares subject to the Restricted Share Award, the
number of Restricted Shares not theretofore vested shall be reacquired
by the Company and forfeited, and the purchase price paid for such
forfeited Shares by the holder shall be returned to the holder. If
Restricted Shares issued shall be reacquired by the Company and
forfeited as provided above, the individual, or in the event of his or
her death, his or her personal representative, shall forthwith deliver
to the
Secretary of the Company the certificates representing such Shares,
accompanied by such instrument of transfer, if any, as may reasonably
be required by the Company.
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13
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(ii)
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Retirement After Completion of Ten Years of
Service
. Notwithstanding subparagraph 6(b)(4)(i) above, any and
all unvested Restricted Share Awards shall immediately vest in the
event of the holders Retirement from the Company and all Affiliates
after attainment of age 65 and completion of ten Years of Service. The
preceding sentence shall be inapplicable, and the forfeiture provisions
of Section 6(b)(4)(i) above shall apply if the employment or
relationship with the Company and its Affiliates is terminated for
Cause. For purposes of this Plan, Cause shall mean the Participants
(i) failure to competently discharge any material portion of his/her
duties; (ii) commission or omission of any acts which are in the nature
of, or constitute, fraud or dishonesty against the Company or any
Affiliate; (iii) behavior which is insubordinate or disruptive to the
Company or any Affiliate, or materially detrimental to the business
reputation of the Company; (iv) breach of any material policy of the
Company or any Affiliate; (v) engaging in competition with the Company
or any Affiliate, either as an individual for his/her own account or as
a partner, officer, director, shareholder, employee, independent
contractor, officer, or otherwise; or (vi) continual inattention to, or
neglect of, any material portion of his/her duties, which inattention
is not the result of illness or accident; as determined by the
Committee in its sole discretion.
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(5)
Restricted Share Awards to Independent Directors
. Each Independent
Director shall be granted a Restricted Share Award on his or her Election Date and a
Restricted Share Award on May 1 of each succeeding year that the individual remains an
Independent Director, in each case in the amount determined from time to time by the
Committee. To the extent the Board shall appoint a Lead Independent Director, such person
may additionally be granted on the date of appointment and on May 1 of the succeeding year a
Restricted Share Award in an amount determined from time to time by the Committee. In
addition, on each May 1 of each succeeding year that the individual remains Lead Independent
Director, the Lead Independent Director may receive a Restricted Share Award in an amount
determined from time to time by the Committee. The Restricted Shares granted under this
Section 6(b)(5) shall vest at the rate of 20% May 1 of each of the five years succeeding the
date of grant. Notwithstanding the preceding sentences, all or any part of any Restricted
Shares granted pursuant to this Section 6(b)(5) shall immediately vest (but in no event
during the six-month period commencing on the date of grant) in the event of the holders
Retirement on or after his or her 65
th
birthday, Permanent Disability or death.
All or any part of any Restricted Shares granted pursuant to this Section 6(b)(5) also shall
vest (but in no event during the six-month period commencing on the date of grant) upon the
occurrence of a Change in Control while the holder is serving as a Director. Any Restricted
Shares granted pursuant
to this Section 6(b)(5), to the extent unvested, shall terminate immediately upon the
holders ceasing to serve as a Director (for any reason other than Retirement on or after
his or her 65
th
birthday, Permanent Disability or death as described above).
14
(c)
Performance Goals
. The Committee, in its discretion, (i) may establish one or
more performance goals as a precondition to the issuance or vesting of Award, which may be
Restricted Shares or units (Performance Units) having a value equal to an identical number of
Restricted Shares, and, in the case of Performance Units, shall determine whether such Performance
Units will be paid in cash, Shares, or a combination of cash and Shares, and (ii) may provide, in
connection with the establishment of the performance goals, for predetermined Awards to those
Participants (who continue to meet all applicable eligibility requirements) with respect to whom
the applicable performance goals are satisfied. In the case of any grant intended to qualify as
performance-based compensation under Code Section 162(m) (including, for these purposes, grants
constituting performance-based compensation, as determined without regard to certain shareholder
approval and disclosure requirements by virtue of an applicable transition rule), the Committee (i)
may use one or a combination of the performance goals set forth in
Exhibit A
; and (ii) may
establish other goals (with shareholder approval of other types of goals) intended to be
performance goals as contemplated by Code Section 162(m) and the regulations thereunder. Any
Award, other than Options or Rights, that is based on the satisfaction of performance goals, as
described in this Section 6(c), and is intended to qualify as performance-based compensation under
Code Section 162(m), may not exceed $5,000,000 with respect to any Participant.
(d)
Limited Rights
. The Committee shall have the power to grant limited rights
(Limited Rights), which shall have no relationship to an Option Award. Limited Rights shall
provide for the automatic cash payment to the holder of such Limited Rights equal to the Spread
valued upon the occurrence of a Change in Control and payable on the dated fixed by the Committee
at the time of the grant of such Limited Right. Limited Rights may provide that Committee approval
is not required for the exercise of such Limited Right. Upon exercise of such Limited Right,
payment therefore shall be made in full on the date fixed by the Committee; provided that the
Participant remains employed by the Company through such payment date.
(e)
Dividends and Dividend Equivalents
. Subject to the limitations on the payment of
cash dividends set forth in Section 6(i), a Restricted Share Award may provide the Participant with
the right to receive dividend payments or dividend equivalent payments with respect to Shares
subject to the Award (both before and after the Shares subject to the Award are earned, vested or
acquired). Such payments may be settled in cash or Shares as determined by the Committee. Any
such settlements may be subject to such conditions, restrictions and contingencies as the Committee
shall establish, but may not be deferred except to the extent Section 6(h) hereof applies.
15
(f)
Other Equity-Based Awards
. The Committee shall have the right (i) to grant other
Awards based on Shares (including the grant or offer for sale of unrestricted Shares and
performance shares and performance units settled in Shares or cash) having such terms and
conditions as the Committee may determine (which Awards and related agreements need not be
identical), including, without limitation, the grant of Shares based upon certain conditions, the
grant of exchangeable or redeemable securities or equity interests, and the grant of share
appreciation rights, (ii) to grant limited partnership or any other membership or ownership
interests (which may be expressed as units or otherwise) in a subsidiary, operating or other
partnership, or other affiliate of the Company, with any Shares being issued in connection with the
conversion of (or other distribution on account of) an interest granted under the authority of this
clause (ii) to be subject, for the avoidance of doubt, to Section 5 and the other provisions of
this Plan, and (iii) to grant Awards valued by reference to book value, fair value or performance
parameters relative to the Company or any subsidiary or group of subsidiaries of the Company.
(g)
Consideration for Awards
. Subject to the requirements of applicable law, the
Company shall obtain such consideration for the grant of an Award under this Section 6 as the
Committee in its discretion may determine.
(h)
Deferral
. To the extent permissible under the Amended and Restated Camden Property
Trust Non-Qualified Deferred Compensation Plan, the Committee may permit a Participant to elect to
defer payment of an Award of Restricted Shares (including a right to receive dividend payments or
dividend equivalent payments with respect to an Award of Restricted Shares) or Options in
accordance with the terms of such plan and may grant deferred Options in accordance with the terms
of such plan.
(i)
Limitation on Payment of Dividends on Performance-Based Awards
. Notwithstanding
any other provision hereof, any cash dividend or distribution otherwise payable pursuant to an
Award granted pursuant to this Section 6 that remains subject to performance-based vesting, or
forfeiture based on the failure to meet performance-based conditions (
i.e
., conditions other than
the continued service or employment of the Participant through a certain date), must be retained
by, or repaid by the Participant to, the Company or the applicable entity granting the Award;
provided that, to the extent provided for in the applicable Award agreement or by the Committee, an
amount equal to such cash dividends or distributions retained or repaid by the Participant may be
paid to the Participant upon the satisfaction or lapsing of such performance-based conditions with
respect to such Award.
7. Adjustment Provisions.
If, prior to the complete exercise of any Option, or prior to the expiration or lapse of all
of the restrictions and conditions imposed pursuant to a Restricted Share Award, there shall be
declared and paid a dividend upon the Shares (other than dividends payable in cash) or if the
Shares shall be split up, converted, exchanged, reclassified or in any way substituted for, then
(i) in the case of an Option, the Option, to the extent that it has not been exercised, shall
entitle the holder thereof upon the future exercise of the Option to such number and kind of
securities or cash or other property subject to the terms of the Option to which he or she would
have been entitled had he or she actually owned the Shares subject to the unexercised portion of
the Option at the time of the occurrence of such dividend, split-up, conversion, exchange,
reclassification or substitution, and the aggregate purchase price upon the future exercise of the
Option shall be the same as if the originally optioned Shares were being purchased thereunder; and
(ii) in the case of Restricted Shares issued pursuant to a Restricted Share Award, the holder of
such Award shall receive, subject to the same restrictions and other conditions of such Award as
determined pursuant to the provisions of Section 6(b), the same securities or other property as are
received by the holders of Shares pursuant to such dividend, split-up, conversion, exchange,
reclassification or substitution. Any fractional Shares or securities payable upon the
exercise of the Option as a result of such adjustment shall be payable in cash based upon the Fair
Market Value of such Shares or securities at the time of such exercise. If any such event should
occur, the number of Shares with respect to which Awards remain to be issued, or with respect to
which Awards may be reissued, shall be adjusted in a similar manner.
16
In addition to the adjustments provided for in the preceding paragraph, upon the occurrence of
any of the events referred to in said paragraph prior to the complete exercise of any Rights or
Limited Rights, the Committee, in its sole discretion, shall determine the amount of cash and/or
number of Shares or other property to which the holder of the Rights shall be entitled upon their
exercise so that there shall be no increase or dilution in the cash and/or value of the Shares or
other property to which the holder of Rights shall be entitled by reason of such events.
Notwithstanding any other provision of this Plan, in the event of a recapitalization, merger,
consolidation, rights offering, separation, reorganization or liquidation, or any other change in
the corporate structure or outstanding Shares, the Committee shall make such equitable adjustments
to the number of Shares and the class of shares available hereunder or to any outstanding Awards as
it shall deem appropriate to prevent dilution or enlargement of rights, provided, however, as
follows: (i) any adjustments made pursuant to this Section to Awards that are considered deferred
compensation within the meaning of Code Section 409A shall be made in compliance with the
requirements of Code Section 409A unless the Participant consents otherwise; (ii) any adjustments
made to Awards that are not considered deferred compensation subject to Code Section 409A shall
be made in such a manner as to ensure that after such adjustment, the Awards either continue not to
be subject to Code Section 409A or comply with the requirements of Code Section 409A unless the
Participant consents otherwise; and (iii) the Committee shall not have the authority to make any
adjustments under this Section to the extent that the existence of such authority would cause an
Award that is not intended to be subject to Code Section 409A to be subject thereto.
8. Acceleration.
Notwithstanding any other provision of this Plan to the contrary, all or any part of any
remaining unexercised Options and Rights granted to any person may be exercised in the following
circumstances (but in no event during the six month period commencing on the date granted) and all
or any part of any other Award not theretofore vested shall vest: (i) with respect to Options or
Rights only, immediately upon (but prior to the expiration of the term of the Option or Rights)
Retirement, (ii) subject to the provisions of Section 6, upon the Permanent Disability or death of
the holder, (iii) upon the occurrence of such special circumstance or event as in the opinion of
the Committee merits special consideration or (iv) upon (A) the Companys adoption of a plan of
merger, (B) the Companys shareholders adoption of a plan of complete liquidation of the Company,
or (C) the receipt by the Company of a tender or exchange offer, the consummation of any of which
would constitute a Change in Control; provided that, the date on which any Award subject to Code
Section 409A that becomes vested pursuant to this Section 8(iv) shall be payable or distributable
shall be the date of the occurrence of the Change in Control.
17
9. Participants Agreement.
If, at the time of the exercise of any Option or Right or the granting or vesting of an Award,
in the opinion of counsel for the Company, it is necessary or desirable, in order to comply with
any then applicable laws or regulations relating to the sale of securities, that the individual
exercising the Option or Right or receiving the Award shall agree to hold any Shares issued to the
individual for investment and without any present intention to resell or distribute the same and
that the individual will dispose of such Shares only in compliance with such laws and regulations,
the individual will, upon the request of the Company, execute and deliver to the Company a further
agreement to such effect.
10. Withholding Taxes.
No Award may be exercised and no distribution of Shares or cash pursuant to an Award may be
made under this Plan until appropriate arrangements have been made by the holder with the Company
for the payment of any amounts that the Company may be required to withhold with respect thereto,
which arrangements may include the tender of previously owned Shares or the withholding of Shares
issuable pursuant to such Award.
11. Termination of Authority to Make Grant.
No Awards will be granted pursuant to this Plan after May 11, 2021.
12. Amendment and Termination; Restriction on Repricing Options.
The Board may from time to time and at any time alter, amend, suspend, discontinue or
terminate this Plan or, with the consent of an affected holder, any outstanding Awards hereunder,
provided, however, that no such action of the Board may, without the approval of the shareholders
of the Company, alter the provisions of this Plan or outstanding Awards so as to (i) increase the
maximum number of Shares which may be subject to Awards under this Plan (except as provided in
Section 5(b)); or (ii) change the class of persons eligible to receive Awards; or (iii) amend this
Plan in any manner that would require shareholder approval under Rule 16b-3 of the Exchange Act or
under Code Sections 162(m) or 422; or (iv) reduce the purchase price on an outstanding Option.
13. Preemption by Applicable Laws and Regulations.
Notwithstanding anything in this Plan to the contrary, if, at any time specified herein for
the making of any determination or payment, or the issuance or other distribution of Shares, any
law, regulation or requirement of any governmental authority having jurisdiction in the premises
shall require either the Company or the Participant (or the Participants beneficiary), as the case
may be, to take any action in connection with any such determination, payment, issuance or
distribution, the issuance or distribution of such Shares or the making of such determination or
payment, as the case may be, shall be deferred until such action shall have been taken.
18
14. Awards Granted Under 2002 Plan
.
Nothing contained in this Plan shall in any manner affect awards granted under the 2002 Plan
or the rights of the holders thereof. In furtherance of such matter, upon the exercise of an
Incentive Exchange Right (as defined in the 2002 Plan) pursuant to options granted under the 2002
Plan, the holder thereof shall receive a grant of Restricted Shares, which grant shall be subject
to the provisions of Section 5(f) of the 2002 Plan.
15. Miscellaneous.
(a)
No Employment Contract
. Nothing contained in this Plan shall be construed as
conferring upon any Participant the right to continue in the employ of, or as a Director of or
consultant to, the Company or any Affiliate.
(b)
Employment or Service with Affiliates
. Employment by, or service for, the Company
for the purpose of this Plan shall be deemed to include employment by, or service for, any
Affiliate.
(c)
No Rights as a Shareholder
. A Participant shall have no rights as a shareholder
with respect to Shares covered by the Participants Award until the date of the issuance of such
Shares to the Participant pursuant thereto. No adjustment will be made for dividends or other
distributions or rights for which the record date is prior to the date of such issuance.
(d)
Nonassignability
.
(1)
General
. Neither a Participant nor a Participants estate, personal
representative or beneficiary shall have the power or right to sell, exchange, pledge,
transfer, assign or otherwise encumber or dispose of such Participants estates, personal
representatives or beneficiarys interest arising under this Plan nor shall such interest
be subject to seizure for the payment of a Participants or beneficiarys debts, judgments,
alimony, or separate maintenance or be transferable by operation of the law in the event of
a Participants, estates, personal representatives or beneficiarys bankruptcy or
insolvency and to the extent any such interest arising under this Plan is awarded to a
spouse pursuant to any divorce proceeding, such interest shall be deemed to be terminated
and forfeited, notwithstanding any vesting provisions or other terms herein or in such
Award.
19
(2)
Transfers to Family Trusts
. Notwithstanding the preceding or any other
limitation on the transferability of Awards, the Committee may (in its sole discretion)
permit a Participant to transfer an Award (other than an ISO), or cause the Company to grant
an Award (other than an ISO) that otherwise would be granted to a Participant, to a trust
established for the benefit of one or more of the children, grandchildren or spouse of the
Participant or pursuant to a qualified domestic relations order. Any Participant desiring
to make a transfer pursuant to this subsection shall make application therefore in such
manner and time specified by the Committee and shall comply with such other requirements as
the Committee may require to assure compliance with all applicable securities and tax laws.
The Committee shall not give permission for such an issuance or transfer if it would give
rise to short-swing liability under Section 16(b) of the Exchange
Act, liability for the additional tax under Code Section 409(a)(1)(B), or if it may
not be made in compliance with all applicable federal, state and foreign securities laws.
The granting of permission for such an issuance or transfer shall not obligate the Company
to register the Shares to be issued under an Award under federal or state securities laws.
(e)
Application of Funds
. The proceeds received by the Company from the sale of
Shares pursuant to this Plan will be used for its general business purposes.
(f)
Governing Law; Construction
. All rights and obligations under this Plan shall be
governed by, and this Plan shall be construed in accordance with, the laws of the state in which
the Company has been formed, without regard to the principles of conflicts of laws. Titles and
headings to Sections herein are for purposes of reference only, and shall in no way limit, define
or otherwise affect the meaning or interpretation of any provisions of this Plan.
20
EXHIBIT A
PERFORMANCE GOALS
Awards intended to qualify as performance-based compensation under Code Section 162(m), may
be payable upon the attainment of objective performance goals that are established by the Committee
and relate to one or more Performance Goals, in each case on specified date or over any period, up
to 10 years, as determined by the Committee. Any of the Performance Goals may (but need not) be
based on the achievement of the specified levels of performance under one or more of the measures
set out below relative to the performance of one or more other corporations or indices.
Performance Goals means one or more of the following business criteria (or any combination
thereof) with respect to one or more of the Company, or any subsidiary, division, other operational
unit or administrative department of thereof, or a change (or the absence of change) thereto:
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(i)
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pre-tax income;
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(ii)
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after-tax income;
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(iii)
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net operating income (meaning net operating income as reflected in the
Companys financial reports for the applicable period, on an aggregate, diluted and/or
per share basis);
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(iv)
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operating income;
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(v)
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cash flow;
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(vi)
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revenue;
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(vii)
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same property revenue;
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(viii)
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earnings per share;
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(ix)
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return on equity;
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(x)
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return on invested capital or assets;
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(xi)
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cash and/or funds available for distribution;
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(xii)
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market value of Shares;
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(xiii)
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return on investment;
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(xiv)
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total return to shareholders;
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(xv)
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net earnings;
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A-1
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(xvi)
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return, coverage and/or similar ratios;
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(xvii)
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number of equity and/or securities sold;
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(xviii)
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completion of property development;
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(xix)
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achievement of pro forma property yields;
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(xx)
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achievement of budgets;
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(xxi)
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balance sheet and/or liquidity measures;
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(xxii)
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funds from operations (FFO); and/or
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(xxiii)
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adjusted funds from operations (AFFO).
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In addition, any Performance Goals may be based upon the attainment of specified levels of
performance under one or more of the Performance Goals above relative to the performance of other
companies or the historic performance of the Company. Performance Goals may be absolute amounts or
percentages of amounts or may be relative to the performance of other companies or of indexes.
To the extent permitted by Code Section 162(m), unless the Committee provides otherwise at the
time of establishing the Performance Goals, for each fiscal year of the Company, the Committee may
provide for objectively determinable adjustments, as determined in accordance with accounting
principles generally accepted in the United States of America (GAAP) (to the extent applicable),
to any of the Performance Goals described above for one or more of the items of gain, loss, profit
or expense: (A) determined to be extraordinary or unusual in nature or infrequent in occurrence,
(B) related to the disposal of a segment of a business, (C) related to a change in accounting
principle under GAAP, (D) related to discontinued operations that do not qualify as a segment of a
business under GAAP, and (E) attributable to the business operations of any entity acquired by the
Company during the fiscal year.
A-2