AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 10, 2007.
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ENTERTAINMENT PROPERTIES TRUST
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
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Maryland
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43-1790877
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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30 WEST PERSHING ROAD, SUITE 201
KANSAS CITY, MISSOURI 64105
(816) 472-1700
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT’S PRINCIPAL EXECUTIVE OFFICES)
GREGORY K. SILVERS, ESQ.
VICE PRESIDENT, SECRETARY, GENERAL COUNSEL
AND CHIEF OPERATING OFFICER
ENTERTAINMENT PROPERTIES TRUST
30 W. PERSHING ROAD, SUITE 201
KANSAS CITY, MISSOURI 64108
(816) 472-1700
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
CRAIG L. EVANS, ESQ.
STINSON MORRISON HECKER LLP
1201 WALNUT, SUITE 2900
KANSAS CITY, MISSOURI 64106
(816) 842-8600
ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
CALCULATION OF REGISTRATION FEE
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Amount to
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Proposed maximum
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Proposed maximum
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Amount of
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be
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offering price per
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aggregate offering
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registration
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Title of securities to be registered
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registered
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share (1)
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price (1)
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fee
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Common shares of beneficial
interest. $.01 par value
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950,000 (2)
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$61.03
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$57,978,500
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$1,779.94
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(1)
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Estimated solely for purposes of calculating registration fee, based on $61.03,
the average of the high and low market prices per common share of beneficial interest
as reported by the New York Stock Exchange on May 9, 2007, pursuant to Rule 457(h)
under the Securities Act of 1933.
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(2)
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The provisions of Rule 416 shall apply to this registration statement and the
number of shares registered on this registration statement automatically shall
increase or decrease as a result of stock splits, stock dividends, or similar
transactions.
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TABLE OF CONTENTS
PART I
Information Required in the Section 10(a) Prospectus
In accordance with Rule 428 under the Securities Act of 1933, as amended, which may be
referred to as the Securities Act, and the instructional note to Part I of Form S-8, the
information specified in Part I of Form S-8 has been omitted from the filing of this registration
statement with the Securities and Exchange Commission, or the SEC.
The documents containing the information specified in Part I of Form S-8 will be sent or given
to participating employees as specified by Rule 428(b)(1) of the Securities Act. Such documents
and the documents incorporated by reference herein pursuant to Item 3 of Part II hereof, taken
together, constitute a prospectus that meets the requirements of Section 10(a) of the Securities
Act.
PART II
Information Required in the Registration Statement
Item 3. Incorporation of Documents by Reference.
The SEC allows Entertainment Properties Trust (the “registrant”), to “incorporate by
reference” the information that it files with the SEC, which means:
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incorporated documents are considered part of this registration statement;
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the registrant can disclose important information by referring the reader to these
documents, which may be documents that the registrant previously has filed with the SEC
or that will be filed with the SEC in the future; and
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information that the registrant files with the SEC will automatically update and
supersede this registration statement and any previously incorporated information.
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The registrant incorporates by reference the documents or portions of documents listed below
which were filed with the SEC under the Securities Exchange Act of 1934, as amended, which may be
referred to as the Exchange Act:
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The registrant’s annual report on Form 10-K for the year ended December 31, 2006;
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The registrant’s quarterly report on Form 10-Q for the quarter ended March 31, 2007;
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The registrant’s current reports on Form 8-K filed with the SEC on February 27,
2007, April 20, 2007, April 25, 2007, May 1, 2007 and May 4, 2007, respectively; and
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the description of the registrant’s common shares of beneficial interest contained
in the registration statement on Form 8-A (File No. 001-13561) filed by the registrant
under the Exchange Act, as amended to date, including any amendment or report filed for
the purpose of updating such description.
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The registrant also incorporates by reference filings with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act that are filed with the SEC after the date of this
registration statement and prior to the filing of a post-effective amendment which indicates that
all securities offered have been sold or which deregisters all securities then remaining unsold.
Any statement contained in the documents incorporated, or deemed to be incorporated, by reference
herein shall be deemed to be modified or superseded for purposes of this registration statement to
the extent that a statement contained herein or in any other subsequently filed document which also
is,
or is deemed to be, incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this registration statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
The laws relating to Maryland real estate investment trusts (the “Maryland REIT Law”) permit a
real estate investment trust to indemnify and advance expenses to its trustees, officers, employees
and agents to the same extent permitted by the Maryland General Corporation Law (the “MGCL”) for
directors and officers of Maryland corporations. The MGCL permits a corporation to indemnify its
present and former directors and officers against judgments, penalties, fines, settlements and
reasonable expenses incurred in connection with any proceeding to which they may be made, or are
threatened to be made, a party by reason of their service in those capacities. However, a Maryland
corporation is not permitted to provide this type of indemnification if the following is
established:
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the act or omission of the director or officer was material to the matter giving
rise to the proceeding and was committed in bad faith or was the result of active and
deliberate dishonesty;
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the director or officer actually received an improper personal benefit in money,
property or services; or
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in the case of any criminal proceeding, the director or officer had reasonable cause
to believe that the act or omission was unlawful.
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Additionally, a Maryland corporation may not indemnify a director or officer for an adverse
judgment in a suit by or in the right of that corporation or for a judgment of liability on the
basis that personal benefit was improperly received, unless in either case a court orders
indemnification and then only for expenses. The MGCL permits a corporation to advance reasonable
expenses to a director or officer upon the corporation’s receipt of the following:
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a written affirmation by the director or officer of his good faith belief that he
has met the standard of conduct necessary for indemnification by the corporation; and
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a written undertaking by him or on his behalf to repay the amount paid or reimbursed
by the corporation if it is ultimately determined that this standard of conduct was not
met.
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Our officers and trustees are and will be indemnified under our Declaration of Trust against
certain liabilities. Our Declaration of Trust provides that we will, to the maximum extent
permitted by Maryland law in effect from time to time, indemnify: (a) any individual who is a
present or former trustee or officer of EPR; or (b) any individual who, while a trustee or officer
of EPR and at the request of EPR, serves or has served as a director, officer, shareholder,
partner, trustee, employee or agent of any real estate investment trust, corporation, partnership,
joint venture, trust, employee benefit plan or any other enterprises against any claim or
liability, together with reasonable expenses actually incurred in advance of a final disposition of
a legal proceeding, to which such person may become subject or which such person may incur by
reason of his or her status as such. We have the power, with the approval of our Board of Trustees,
to provide such indemnification and advancement of expenses to a person who served a predecessor of
EPR in any of the capacities described in (a) or (b) above and to any employee or agent of EPR or
its predecessors.
We have also entered into indemnification agreements with our trustees and officers providing
for procedures for indemnification by us to the fullest extent permitted by law and advancements by
us of certain expenses and costs relating to claims, suits or proceedings arising from their
service to us.
We have obtained trustee’s and officers’ liability insurance for the purpose of funding the
provision of any such indemnification.
The SEC has expressed the opinion that indemnification of trustees, officers or persons
otherwise controlling a company for liabilities arising under the Securities Act is against public
policy and is therefore unenforceable.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
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Exhibit
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Number
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Description
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4.1
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Form of Common Share of Beneficial Interest Certificate (incorporated by
reference to Exhibit 4.5 to the Registration Statement on Form S-11 (333-35281).
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5.1
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Opinion of Stinson Morrison Hecker LLP.
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10.1
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Entertainment Properties Trust 2007
Equity Incentive Plan , as amended.
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10.2
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Form of Share Option Award — Employee.
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10.3
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Form of Share Option Award —
Non-Employee Trustee.
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10.4
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Form of Restricted Share Award
— Employee.
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10.5
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Form of Restricted Share Award
— Non-Employee Trustee.
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23.1
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Consent of Stinson Morrison Hecker LLP (included in Exhibit 5.1).
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23.2
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Consent of KPMG LLP.
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24.1
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Power of Attorney (included in the signature page to this Registration Statement).
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Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the Securities
Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this registration statement (or the most recent post-effective
amendment thereto) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in the
“Calculation of Registration Fee” table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any material
change to such information in the registration statement;
Provided
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however
, that
(A) Paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in reports filed with or furnished to the Commission by the
registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement; and
(B) Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not
apply if the information required to be included in a post-effective amendment by
those paragraphs is contained in reports filed with or furnished to the Commission
by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration statement, or is
contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the
registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, and, where applicable,
each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the registrant, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable. In the event that
a claim for indemnification against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it
has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and
has duly caused this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Kansas City, State of Missouri, on this 10
th
day of May, 2007.
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ENTERTAINMENT PROPERTIES TRUST,
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a Maryland real estate investment trust
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By:
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/s/ Gregory K. Silvers
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Name:
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Gregory K. Silvers
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Title:
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Vice President, Chief Operating Officer,
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General Counsel and Secretary
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POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints David M. Brain, Gregory K.
Silvers and Mark A. Peterson, and each of them, his true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments, including post-effective amendments, to
this registration statement, and to any other documents filed with the Securities and Exchange
Commission and to file the same, with all exhibits to the registration statement and other
documents in connection with the registration statement, with the Securities and Exchange
Commission or any other regulatory authority, grants to the attorney-in-fact and agent full power
and authority to do and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or could do in person, and
ratifies and confirms all that the attorney-in-fact and agent, or his substitute, may lawfully do
or cause to be done by virtue of this power of attorney.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed below by the following persons in the capacities and on the date indicated.
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By:
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/s/ Robert J. Druten
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Chairman of the Board of Trustees
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May 10, 2007
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Robert J. Druten
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By:
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/s/ David M. Brain
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President, Chief Executive Officer
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May 10, 2007
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David M. Brain
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(Principal Executive Officer) and Trustee
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By:
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/s/ Mark A. Peterson
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Vice President and Chief Financial
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May 10, 2007
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Mark A. Peterson
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Officer (Principal Financial Officer
and Principal
Accounting Officer)
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By:
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/s/ Morgan G. Earnest, II
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Trustee
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May 10, 2007
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Morgan G. Earnest, II
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By:
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/s/ James A. Olson
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Trustee
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May 10, 2007
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James A. Olson
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By:
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/s/ Barrett Brady
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Trustee
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May 10, 2007
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Barrett Brady
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EXHIBIT INDEX
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Exhibit
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Number
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Description
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4.1
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Form of Common Share of Beneficial Interest Certificate (incorporated by
reference to Exhibit 4.5 to the Registration Statement on Form S-11 (333-35281).
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5.1
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Opinion of Stinson Morrison Hecker LLP.
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10.1
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Entertainment Properties Trust 2007
Equity Incentive Plan , as amended.
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10.2
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Form of Share Option Award — Employee.
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10.3
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Form of Share Option Award —
Non-Employee Trustee.
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10.4
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Form of Restricted Share Award
— Employee.
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10.5
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Form of Restricted Share Award
— Non-Employee Trustee.
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23.1
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Consent of Stinson Morrison Hecker LLP (included in Exhibit 5.1).
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23.2
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Consent of KPMG LLP.
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24.1
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Power of Attorney (included in the signature page to this Registration Statement).
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Exhibit 5.1
May 10, 2007
1201 Walnut, Suite 2900
Kansas City, MO 64106-2150
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Tel
(816) 842-8600
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Entertainment Properties Trust
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Fax
(816) 412-9327
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30 Pershing Road, Suite 201
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Kansas City, Missouri 64108
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Re: Registration Statement on Form S-8
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Ladies and Gentlemen:
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We have acted as counsel to Entertainment Properties Trust, a Maryland real estate investment
trust (the “Issuer”), in connection with the preparation and filing of a registration
statement on Form S-8 (the “Registration Statement”) with the Securities and Exchange Commission
(the “Commission”) covering 950,000 common shares of beneficial interest. $.01 par value (the
“Shares”) issuable pursuant to the Issuer’s 2007
Equity Incentive Plan, as amended (the “Plan”).
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In connection with this opinion, we have examined originals or copies certified or otherwise
identified to our satisfaction of such documents, corporate records and other instruments as we
have deemed necessary for the purposes of this opinion, including (i) the Declaration of Trust and
Bylaws of the Issuer, (ii) minutes and records of the corporate proceedings of the Issuer with
respect to the issuance of the Shares, (iii) the Registration Statement, and (iv) the Plan.
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For purposes of this opinion, we have assumed the authenticity of all documents submitted to
us as originals, the conformity to the originals of all documents submitted to us as copies and the
authenticity of the originals of all documents submitted to us as copies. We have also assumed the
genuineness of the signatures of persons signing all documents in connection with which this
opinion is rendered, the authority of such persons signing on behalf of the parties thereto other
than the Issuer and the due authorization, execution and delivery of all documents by the parties
thereto other than the Issuer. As to any facts material to the opinion expressed herein which we
have not independently established or verified, we have relied upon the statements and
representations of officers and other representatives of the Issuer and others.
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KANAS CITY
OVERLAND PARK
WICHITA
WASHINGTON, D.C.
PHOENIX
ST. LOUIS
OMAHA
JEFERSON CITY
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Our opinion expressed below is subject to the qualifications that we express no opinion as to
the applicability of, compliance with, or effect of (i) applicable bankruptcy, insolvency,
reorganization, moratorium, arrangement and other laws affecting creditors’ rights, including,
without limitation, the effect of statutory or other laws regarding fraudulent conveyances,
fraudulent transfers and preferential transfers, (ii) the limitations imposed by general principles
of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the
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Entertainment Properties Trust
May 10, 2007
Page 2
possible unavailability of specific performance or injunctive relief regardless of whether
considered in a proceeding in equity or at law; and (iii) public policy considerations which may
limit the rights of parties to obtain certain remedies.
We render no opinion herein as to matters involving the laws of any jurisdiction other than
the present laws of the United States of America, the present laws of the State of Missouri
(excluding local laws), the Maryland Corporations and Associations Act, and the present judicial
interpretations thereof. We advise you that the issues addressed by this opinion may be governed
in whole or in part by other laws, and we express no opinion as to whether any relevant difference
exists between the laws upon which our opinion is based and any other laws that may actually
govern.
Based upon and subject to the assumptions, qualifications, exclusions and other limitations
contained in this letter, we are of the opinion that the Shares
covered by the Registration Statement have been duly authorized by the
Issuer and, when
issued and paid for by the Plan participants as contemplated by the
Plan and in accordance with the terms and conditions of the Plan and
the applicable award agreements, such Shares will be validly issued, fully paid and
non-assessable.
This opinion is limited to the specific issues addressed herein, and no opinion may be
inferred or implied beyond that expressly stated herein. This opinion shall not be construed as or
deemed to be a guaranty or insuring agreement. This opinion is rendered on the date hereof and we
have no continuing obligation hereunder to inform you of changes of law, including judicial
interpretations of law, or of facts of which we become aware after the date hereof.
We consent to the filing of this opinion with the Commission as an exhibit to the Registration
Statement. In giving such consent, we do not thereby admit that we are in the category of persons
whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules
of the Commission.
Very truly yours,
STINSON MORRISON HECKER LLP
/s/
Stinson Morrison Hecker LLP
Exhibit 10.1
ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
(As amended May 9, 2007)
TABLE OF CONTENTS
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Page
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SECTION 1
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INTRODUCTION
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1
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1.1
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Establishment
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1
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1.2
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Purpose
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1
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1.3
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Duration
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1
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1.4
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Plan Subject to Shareholder Approval
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1
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SECTION 2
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DEFINITIONS
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1
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2.1
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Definitions
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1
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2.2
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General Interpretive Principles
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8
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SECTION 3
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PLAN ADMINISTRATION
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9
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3.1
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Composition of Committee
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9
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3.2
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Authority of Committee
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9
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3.3
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Committee Delegation
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10
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3.4
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Determination Under the Plan
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10
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SECTION 4
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SHARES SUBJECT TO THE PLAN
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10
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4.1
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Number of Shares
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10
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4.2
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Unused and Forfeited Shares
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10
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4.3
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Adjustments in Authorized Shares
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11
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4.4
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General Adjustment Rules
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11
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SECTION 5
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PARTICIPATION
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11
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5.1
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Basis of Grant
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11
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5.2
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Types of Grants; Limits
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12
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5.3
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Award Agreements
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12
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5.4
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Restrictive Covenants
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12
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5.5
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Maximum Annual Award
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12
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SECTION 6
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SHARE OPTIONS
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12
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6.1
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Grant of Options
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12
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6.2
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Option Agreements
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13
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6.3
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Shareholder Privileges
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16
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SECTION 7
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SHARE APPRECIATION RIGHTS
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17
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7.1
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Grant of SARs
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17
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7.2
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SAR Award Agreement
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17
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7.3
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Exercise of Tandem SARs
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17
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7.4
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Exercise of Freestanding SARs
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17
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7.5
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Expiration of SARs
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18
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7.6
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Payment of SAR Amount
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18
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SECTION 8
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AWARDS OF RESTRICTED SHARE AND RESTRICTED SHARE UNITS
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18
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8.1
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Restricted Shares Awards Granted by Committee
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18
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8.2
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Restricted Shares Unit Awards Granted by Committee
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18
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8.3
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Restrictions
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18
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Page
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8.4
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Privileges of a Shareholder, Transferability
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19
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8.5
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Enforcement of Restrictions
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19
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8.6
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Termination of Service, Death, Disability, etc
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19
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SECTION 9
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PERFORMANCE SHARES, PERFORMANCE UNITS, BONUS SHARES AND
DEFERRED SHARES
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20
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9.1
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Awards Granted by Committee
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20
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9.2
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Terms of Performance Shares or Performance Units
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20
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9.3
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Bonus Shares
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20
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9.4
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Deferred Shares
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20
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SECTION 10
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PERFORMANCE AWARDS; SECTION 162(M) PROVISIONS
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20
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10.1
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Terms of Performance Awards
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20
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10.2
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Performance Goals
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21
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10.3
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Adjustments
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22
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10.4
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Other Restrictions
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22
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10.5
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Section 162(m) Limitations
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22
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SECTION 11
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REORGANIZATION, CHANGE IN CONTROL OR LIQUIDATION
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23
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SECTION 12
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RIGHTS OF EMPLOYEES; PARTICIPANTS
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24
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12.1
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Employment
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24
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12.2
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Nontransferability
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24
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12.3
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Permitted Transfers
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24
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SECTION 13
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GENERAL RESTRICTIONS
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25
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13.1
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Investment Representations
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25
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13.2
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Compliance with Securities Laws
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25
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13.3
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Share Restriction Agreement
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25
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SECTION 14
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OTHER EMPLOYEE BENEFITS
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25
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SECTION 15
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PLAN AMENDMENT, MODIFICATION AND TERMINATION
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26
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15.1
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Amendment, Modification, and Termination
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26
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15.2
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Adjustment Upon Certain Unusual or Nonrecurring Events
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26
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15.3
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Awards Previously Granted
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26
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SECTION 16
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WITHHOLDING
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26
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16.1
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Withholding Requirement
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26
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16.2
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Withholding with Shares
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26
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SECTION 17
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NONEXCLUSIVITY OF THE PLAN
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27
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17.1
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Nonexclusivity of the Plan
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27
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SECTION 18
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REQUIREMENTS OF LAW
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27
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18.1
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Requirements of Law
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27
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18.2
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Code Section 409A
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27
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18.3
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Rule 16b-3
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28
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18.4
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Governing Law
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28
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ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
SECTION 1
INTRODUCTION
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1.1
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Establishment
. Entertainment Properties Trust, a Maryland real estate investment trust (the
“Company”), hereby establishes the Entertainment Properties Trust 2007 Equity Incentive Plan
(the “Plan”) for certain employees, non-employee trustees and consultants of the Company.
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1.2
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Purpose
. The purpose of this Plan is to encourage employees of the Company and its
affiliates and subsidiaries, and non-employee trustees of the Company to acquire a proprietary
and vested interest in the growth and performance of the Company. The Plan also is designed
to assist the Company in attracting and retaining employees, non-employee trustees and
consultants by providing them with the opportunity to participate in the success and
profitability of the Company.
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1.3
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Duration
. The Plan shall commence on the Effective Date and shall remain in effect, subject
to the right of the Board to amend or terminate the Plan at any time pursuant to Section 15
hereof, until all Shares subject to the Plan shall have been issued, purchased or acquired
according to the Plan’s provisions. Unless the Plan shall be reapproved by the shareholders
of the Company and the Board renews the continuation of the Plan, no Awards shall be issued
pursuant to the Plan after the tenth (10
th
) anniversary of the Effective Date.
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1.4
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Plan Subject to Shareholder Approval
. Although the Plan is effective on the Effective Date,
the Plan’s continued existence is subject to the Plan being approved by the Company’s
shareholders within 12 months of the Effective Date. Any Awards granted under the Plan after
the Effective Date but before the approval of the Plan by the Company’s shareholders will
become null and void if the Company’s shareholders do not approve this Plan within such
12-month period.
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SECTION 2
DEFINITIONS
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2.1
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The following terms shall have the meanings set forth below.
“
1933 Act
” means the Securities Act of 1933.
“
1934 Act
” means the Securities Exchange Act of 1934.
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“
Affiliate
” of the Company means any Person that directly, or indirectly through one or
more intermediaries, Controls or is Controlled by, or is under common Control with the
Company.
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A-1
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“
Award
” means a grant made under this Plan in any form, which may include but is not
limited to, Share Options, Restricted Shares, Restricted Shares Units, Bonus Shares,
Deferred Shares, Performance Shares, Share Appreciation Rights and Performance Units.
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“
Award Agreement
” means a written agreement or instrument between the Company and a
Holder evidencing an Award.
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“
Beneficiary
” means the person, persons, trust or trusts which have been designated by
a Holder in his or her most recent written beneficiary designation filed with the Company to
receive the benefits specified under this Plan upon the death of the Holder, or, if there is
no designated beneficiary or surviving designated beneficiary, then the Person or Persons
entitled by will or the laws of descent and distribution to receive such benefits.
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“
Board
” means the Board of Trustees of the Company.
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“
Bonus Shares
” means Shares that are awarded to a Participant without cost and without
restriction in recognition of past performance (whether determined by reference to another
employee benefit plan of the Company or otherwise) or as an incentive to become an employee
of the Company or a Subsidiary.
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“
Cause
” means, unless otherwise defined in an Award Agreement or otherwise defined in a
Participant’s employment agreement (in which case such definition will apply) any of the
following:
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(i)
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Participant’s conviction of, plea of guilty to, or plea of nolo
contendere to a felony or other crime that involves fraud or dishonesty;
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(ii)
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Any willful action or omission by a Participant which would
constitute grounds for immediate dismissal under the employment policies of the
Company by which Participant is employed, including intoxication with alcohol
or illegal drugs while on the premises of the Company, or violation of sexual harassment laws or the internal sexual harassment policy of the
Company by which Participant is employed;
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(iii)
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Participant’s habitual neglect of duties, including repeated
absences from work without reasonable excuse; or
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(iv)
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Participant’s willful and intentional material misconduct in
the performance of his duties that results in financial detriment to the
Company;
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provided, however, that for purposes of clauses (ii), (iii) and (iv), “Cause” shall
not include any one or more of the following: bad judgment, negligence or any act
or omission believed by the Participant in good faith to have been in or not opposed
to the interest of the Company (without intent of the Participant to gain, directly
or indirectly, a profit to which the Participant was not legally entitled). A
Participant who agrees to resign from his affiliation with the Company in lieu of
A-2
being terminated for Cause may be deemed, in the sole discretion of the Committee,
to have been terminated for Cause for purposes of this Plan.
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“
Change in Control
” means the first to occur of the following events:
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(i)
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Incumbent Trustees cease for any reason to constitute at least
a majority of the Board.
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(ii)
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Any “person” (as defined in Section 3(a)(9) of the 1934 Act and
as used in Sections 13(d)(3) and 14(d)(2) of the 1934 Act) or “group” (within
the contemplation of Section 13(d)(3) of the 1934 Act and Rule 13d-5
thereunder) is or becomes a “beneficial owner” (as defined in Rule 13d-3 under
the 1934 Act) or controls the voting power, directly or indirectly, of shares
of the Company representing 25% or more of the Company Voting Securities, other
than (1) an acquisition of Company Voting Securities by an underwriter pursuant
to an offering of shares by the Company, (2) a Non-Qualifying Transaction, or
(3) an acquisition of Company Voting Securities directly from the Company which
is approved by a majority of the Incumbent Trustees.
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(iii)
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The shareholders of the Company approve a Business
Combination, other than a Non-Qualifying Transaction.
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(iv)
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The shareholders of the Company approve a plan of complete
liquidation or dissolution of the Company.
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(v)
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The acquisition of direct or indirect Control of the Company by
any “person” or “group.”
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(vi)
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Any transaction or series of transactions which results in the
Company being “closely held” within the meaning of the REIT provisions of the
Code, after any applicable grace period, and with respect to which the Board
has either waived or failed to enforce the “Excess Share” provisions of the
Company’s Amended and Restated Declaration of Trust.
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For purposes of this Change in Control definition:
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A.
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“Company Voting Securities” shall mean the
outstanding shares of the Company eligible to vote in the election of
trustees of the Company.
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B.
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“Company 25% Shareholder” shall mean any
“person” or “group” which beneficially owns or has voting control of
25% or more of the Company Voting Securities.
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C.
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“Business Combination” shall mean a merger,
consolidation, acquisition, sale of all or substantially all of the
Company’s assets
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A-3
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or properties, statutory share exchange or similar
transaction involving the Company or any of its subsidiaries that
requires the approval of the Company’s shareholders, whether for the
transaction itself or the issuance or exchange of securities in the
transaction.
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D.
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“Incumbent Trustees” shall mean (1) the
trustees of the Company as of the Effective Date or (2) any trustee
elected subsequent to the Effective Date whose election or nomination
was approved by a vote of at least two-thirds of the Incumbent Trustees
then on the Board (either by specific vote or approval of a proxy
statement of the Company in which such person is named as a nominee for
trustee).
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E.
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“Parent Corporation” shall mean the ultimate
parent entity that directly or indirectly has beneficial ownership or
voting control of a majority of the outstanding voting securities
eligible to elect directors of a Surviving Corporation.
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F.
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“Surviving Corporation” shall mean the entity
resulting from a Business Combination.
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G.
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“Non-Qualifying Transaction” shall mean a
Business Combination in which all of the following criteria are met:
(1) more than 50% of the total voting power of the Surviving
Corporation or, if applicable, the Parent Corporation, is represented
by Company Voting Securities that were outstanding immediately prior to
the Business Combination (or, if applicable, is represented by shares
into which the Company Voting Securities were converted pursuant to the Business Combination and held in substantially the same
proportion as the Company Voting Securities were held immediately
prior to the Business Combination), (2) no “person” or “group” (other
than a Company 25% Shareholder or any employee benefit plan (or
related trust) sponsored or maintained by the Surviving Corporation
or the Parent Corporation) would become the beneficial owner,
directly or indirectly, of 25% or more of the total voting power of
the outstanding voting securities eligible to elect directors of the
Parent Corporation (or, if there is no Parent Corporation, the
Surviving Corporation) and no Company 25% Shareholder would increase
its percentage of such total voting power as a result of the
transaction, and (3) at least a majority of the members of the board
of directors or similar governing body of the Parent Corporation (or,
if there is no Parent Corporation, the Surviving Corporation)
following the consummation of the Business Combination were Incumbent
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A-4
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Trustees at the time of the Board’s approval of the Business
Combination.
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Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because any “person” or “group” acquires beneficial ownership or voting
control of more than 25% of the Company Voting Securities as a result of any
acquisition of Company Voting Securities by the Company, but if after that
acquisition by the Company the “person” or “group” becomes the beneficial owner or
obtains voting control of any additional Company Voting Securities, a Change in
Control shall be deemed to occur unless otherwise exempted as set forth above.
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“Code”
means the Internal Revenue Code of 1986, as it may be amended from time to time,
and the rules and regulations promulgated thereunder.
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“
Committee
” means (i) the Board, or (ii) one or more committees of the Board to whom
the Board has delegated all or part of its authority under this Plan. Initially, the
Committee shall be the Compensation Committee of the Board which is delegated all of the
Board’s authority under this Plan as contemplated by clause (ii) above.
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“
Company
” means Entertainment Properties Trust, a Maryland real estate investment
trust, and any successor thereto.
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“
Control
” means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a person, whether through the ownership of
voting securities, by contract or otherwise.
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“
Covered Employee
” means an Employee that meets the definition of “covered employee”
under Section 162(m)(3) of the Code.
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“
Date of Grant
” or “
Grant Date
” means, with respect to any Award, the date as of which
such Award is granted under the Plan.
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“
Deferred Shares
” means Shares that are awarded to a Participant on a deferred basis
pursuant to Section 9.4.
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“
Disabled
” or “
Disability
” means an individual (i) is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last for a
continuous period of not less than twelve (12) months or (ii) is, by reason of any medically
determinable physical or mental impairment which can be expected to result in death or can
be expected to last for a continuous period of not less than twelve (12) months, receiving
income replacement benefits for a period of not less than 3 months under a Company-sponsored
accident and health plan. Notwithstanding the above, with respect to an Incentive Share
Option and the period of time following a separation from service in which a Holder may
exercise such Incentive Share Option, “disabled” shall have the same meaning as defined in
Code section 22(e)(3).
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A-5
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“
Effective Date
” means April 2, 2007.
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“
Eligible Employees
” means all Employees (including officers and trustees who are also
Employees) of the Company or an Affiliate upon whose judgment, initiative and efforts the
Company depends, or will depend, for the successful conduct of the Company’s business.
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“
Employee
” means a common law employee of the Company or an Affiliate.
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“
Executive Officer
” means (i) the president of the Company, any vice president of the
Company, including any vice president of the Company in charge of a principal business unit,
division or function (such as sales, administration, or finance), any other officer who
performs a policy making function or any other person who performs similar policy making
functions for the Company, (ii) Executive Officers (as defined in part (i) of this
definition) of subsidiaries of the Company who perform policy making functions for the Company, and (iii) any Person
designated or identified by the Board as being an Executive Officer for purposes of the 1933
Act or the 1934 Act, including any Person designated or identified by the Board as being a
Section 16 Person.
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“
Fair Market Value
” means, as of any date, the value of a Share determined in good
faith, from time to time, by the Committee in its sole discretion, and for this purpose the
Committee may adopt such formulas as in its opinion shall reflect the true fair market value
of such Share from time to time and may rely on such independent advice with respect to such
fair market value as the Committee shall deem appropriate. In the event that the Shares of
the Company are traded on a national securities exchange, the Committee may determine that
the Fair Market Value of the Share shall be based upon the closing price on the trading day
of the applicable date as reported in
The Wall Street Journal
and consistently
applied. If the securities exchange is closed on the applicable date, the closing price on
the next day the securities exchange is open will be the Fair Market Value.
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“
Freestanding SAR
” means any SAR that is granted independently of any Option.
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“Holder”
means a Participant, Beneficiary or Permitted Transferee who is in possession
of an Award Agreement representing an Award that (i) in the case of a Participant has been
granted to such individual, (ii) in the case of a Beneficiary has been transferred to such
person under the laws of descent and distribution, or (iii) in the case of a Permitted
Transferee, has been transferred to such person as permitted by the Committee, and, with
respect to all of the above cases (i), (ii) and (iii), such Award Agreement has not expired,
been canceled or terminated.
“Incentive Share Option”
means any Option designated as such and
granted in accordance with the requirements of Section 422 of the Code.
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“
Nonqualified Share Option
” means any Option to purchase Shares that is not an
Incentive Share Option.
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A-6
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“
Option
” means a right to purchase Shares at a stated price for a specified period of
time. Such definition includes both Nonqualified Share Options and Incentive Share Options.
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“Option Agreement”
or “
Option Award Agreement
” means a written agreement or instrument
between the Company and a Holder evidencing an Option.
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“
Option Exercise Price
” means the price at which Shares subject to an Option may be
purchased, determined in accordance with
Section 6.2(b).
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“
Optionee
” shall have the meaning as set forth in Section 6.2. For the avoidance of
any doubt, in situations where the Option has been transferred to a Permitted Transferee or
passed to a Beneficiary in accordance with the laws of descent and distribution, the
Optionee will not be the same person as the Holder of the Option.
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“
Participant
” means a Service Provider of the Company designated by the Committee from
time to time during the term of the Plan to receive one or more Awards under the Plan.
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“
Performance Award
” means any Award that will be issued or granted, or become vested or
payable, as the case may be, upon the achievement of certain performance goals (as described
in Section 10) to a Participant pursuant to Section 10.
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“
Performance Period
” means the period of time as specified by the Committee during
which any performance goals are to be measured.
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“
Performance Shares
” means an Award made pursuant to Section 9 which entitles a Holder
to receive Shares, their cash equivalent, or a combination thereof based on the achievement
of performance targets during a Performance Period.
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“
Performance Units
” means an Award made pursuant to Section 9 which entitles a Holder
to receive cash, Shares or a combination thereof based on the achievement of performance
goals during a Performance Period.
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“
Person
” shall have the meaning ascribed to such term in Section 3(a)(9) of the 1934
Act and used in Sections 13(d) and 14(d) thereof, including “group” as defined in Section
13(d) thereof.
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“
Plan
” means the Entertainment Properties Trust 2007 Equity Incentive Plan, as set
forth in this instrument and as hereafter amended from time to time.
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“
Restricted Shares
” means Shares granted under Section 8 that are subject those
restrictions set forth therein and the Award Agreement.
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“
Restricted Shares Unit
” means an Award granted under Section 8 evidencing the Holder’s
right to receive a Share (or, at the Committee’s discretion, a cash payment equal to the
Fair Market Value of a Share) at some future date and that is subject those restrictions set
forth therein and the Award Agreement.
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A-7
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“
Rule 16b-3
” means Rule 16b-3 promulgated under the 1934 Act.
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“
SAR
” or “
Share Appreciation Right
” means an Award, granted either alone or in
connection with an Option, that is designated as a SAR pursuant to Section 7.
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“
SAR Holder
” shall have the meaning as set forth in Section 7.2.
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“
Section 16 Person
” means a Person who is subject to obligations under Section 16 of
the 1934 Act with respect to transactions involving equity securities of the Company.
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“
Service Provider
” means an Eligible Employee, a non-employee trustee of the Company or
consultant of the Company.
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“
Shares
” means the shares of beneficial interest in the Company.
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“
Subsidiary
” means (i) in the case of an Incentive Share Option a “subsidiary
corporation,” whether now or hereafter existing, as defined in section 424(f) of the Code,
and (ii) in the case of any other type of Award, in addition to a subsidiary corporation as defined in clause (i), a
limited liability company, partnership or other entity in which the Company controls fifty
percent (50%) or more of the voting power or equity interests.
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“
Tandem SAR
” means a SAR which is granted in connection with, or related to, an Option,
and which requires forfeiture of the right to purchase an equal number of Shares under the
related Option upon the exercise of such SAR; or alternatively, which requires the
cancellation of an equal amount of SARs upon the purchase of the Shares subject to the
Option.
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“
Vested Option
” means any Option, or portion thereof, which is exercisable by the
Holder. Vested Options remain exercisable only for that period of time as provided for
under this Plan and any applicable Option Award Agreement. Once a Vested Option is no
longer exercisable after otherwise having been exercisable, the Option shall become null and
void.
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2.2
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General Interpretive Principles.
(i) Words in the singular shall include the plural and vice
versa, and words of one gender shall include the other gender, in each case, as the context
requires; (ii) the terms “hereof,” “herein,” and “herewith” and words of similar import shall,
unless otherwise stated, be construed to refer to this Plan and not to any particular
provision of this Plan, and references to Sections are references to the Sections of this Plan
unless otherwise specified; (iii) the word “including” and words of similar import when used
in this Plan shall mean “including, without limitation,” unless otherwise specified; and (iv)
any reference to any U.S. federal, state, or local statute or law shall be deemed to also
refer to all amendments or successor provisions thereto, as well as all rules and regulations
promulgated under such statute or law, unless the context otherwise requires.
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A-8
SECTION 3
PLAN ADMINISTRATION
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3.1
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Composition of Committee
. The Plan shall be administered by the Committee. To the extent
the Board considers it desirable for transactions relating to Awards to be eligible to qualify
for an exemption under Rule 16b-3, the Committee shall consist of two or more trustees of the
Company, all of whom qualify as “non-employee directors” within the meaning of Rule 16b-3. To
the extent the Board considers it desirable for compensation delivered pursuant to Awards to
be eligible to qualify for an exemption from the limit on tax deductibility of compensation
under section 162(m) of the Code, the Committee shall consist of two or more trustees of the
Company, all of whom shall qualify as “outside directors” within the meaning of Code section
162(m).
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3.2
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Authority of Committee
. Subject to the terms of the Plan and applicable law, and in addition
to other express powers and authorizations conferred on the Committee by the Plan, the
Committee shall have full power and authority to:
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(a)
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select the Service Providers to whom Awards may from time to time be granted
hereunder;
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(b)
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determine the type or types of Awards to be granted to eligible Service
Providers;
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(c)
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determine the number of Shares to be covered by, or with respect to which
payments, rights, or other matters are to be calculated in connection with, Awards;
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(d)
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determine the terms and conditions of any Award;
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(e)
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determine whether, and to what extent, and under what circumstances Awards may
be settled or exercised in cash, Shares, other securities, other Awards or other
property;
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(f)
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determine whether, and to what extent, and under what circumstance Awards may
be canceled, forfeited, or suspended and the method or methods by which Awards may be
settled, exercised, canceled, forfeited, or suspended;
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(g)
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correct any defect, supply an omission, reconcile any inconsistency and
otherwise interpret and administer the Plan and any instrument or Award Agreement
relating to the Plan or any Award hereunder;
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(h)
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modify and amend the Plan, establish, amend, suspend, or waive such rules,
regulations and procedures of the Plan, and appoint such agents as it shall deem
appropriate for the proper administration of the Plan; and
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(i)
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make any other determination and take any other action that the Committee deems
necessary or desirable for the administration of the Plan.
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A-9
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3.3
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Committee Delegation.
The Committee may delegate to any member of the Board or committee of
Board members such of its powers as it deems appropriate, including the power to sub-delegate,
except that, pursuant to such delegation or sub-delegation, only a member of the Board (or a
committee thereof) may grant Awards from time to time to specified categories of Service
Providers in amounts and on terms to be specified by the Board or the Committee; provided that
no such grants shall be made other than by the Board or the Committee to individuals who are
then Section 16 Persons or other than by the Committee to individuals who are then or are
deemed likely to become a “covered employee” within the meaning of Code section 162(m). A
majority of the members of the Committee may determine its actions and fix the time and place
of its meetings.
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3.4
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Determination Under the Plan
. Unless otherwise expressly provided in the Plan, all
designations, determinations, adjustments, interpretations, and other decisions under or with
respect to the Plan, any Award or Award Agreement shall be within the sole discretion of the
Committee, may be made at any time and shall be final, conclusive, and binding upon all
persons, including the Company, any Participant, any Holder, and any shareholder. No member
of the Committee shall be liable for any action, determination or interpretation made in good
faith, and all members of the Committee shall, in addition to their rights as trustees, be fully protected by the Company with respect to any such action,
determination or interpretation.
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SECTION 4
SHARES SUBJECT TO THE PLAN
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4.1
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Number of Shares
. Subject to adjustment as provided in Section 4.3 and subject to the
maximum amount of Shares that may be granted to an individual in a calendar year as set forth
in Section 5.5, no more than a total of Nine Hundred Fifty Thousand (950,000) Shares are
authorized for issuance under the Plan in accordance with the provisions of the Plan and
subject to such restrictions or other provisions as the Committee may from time to time deem
necessary. Any Shares issued hereunder may consist, in whole or in part, of authorized and
unissued shares or treasury shares. The Shares may be divided among the various Plan
components as the Committee shall determine. Shares that are subject to an underlying Award
and Shares that are issued pursuant to the exercise of an Award shall be applied to reduce the
maximum number of Shares remaining available for use under the Plan. The Company shall at all
times during the term of the Plan and while any Awards are outstanding retain as authorized
and unissued Shares, or as treasury Shares, at least the number of Shares from time to time
required under the provisions of the Plan, or otherwise assure itself of its ability to
perform its obligations hereunder.
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4.2
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Unused and Forfeited Shares
. Any Shares that are subject to an Award under this Plan that
are not used because the terms and conditions of the Award are not met, including any Shares
that are subject to an Award that expires or is terminated for any reason, any Shares that are
not used because the Award is settled in cash, or any Shares that are not issued into the
market because, pursuant to Section 16.2, the Committee permits the Holder to pay all minimum
required amounts of tax withholding by electing to have the Company withhold from the Shares
otherwise issuable to the Holder, shall automatically
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A-10
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become available for use under the Plan.
Notwithstanding the foregoing, any Shares used for full or partial payment of the purchase
price of the Shares with respect to which an Option is exercised and any Shares retained by
the Company pursuant to Section 16.2 that were originally Incentive Share Option Shares must
still be considered as having been granted for purposes of determining whether the Share
limitation provided for in Section 4.1 has been reached for purposes of Incentive Share Option
grants.
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4.3
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Adjustments in Authorized Shares.
If, without the receipt of consideration therefore by the
Company, the Company shall at any time increase or decrease the number of its outstanding
Shares or change in any way the rights and privileges of such Shares such as, but not limited
to, the payment of a share dividend or any other distribution upon such Shares payable in
Shares, or through a share split, subdivision, consolidation, combination, reclassification or
recapitalization involving the Shares, such that an adjustment is necessary in order to
prevent dilution or enlargement of the benefits or potential benefits intended to be made
available under the Plan, then in relation to the Shares that are affected by one or more of
the above events, the numbers, rights and privileges of (i) the Shares as to which Awards may
be granted under the Plan, (ii) the exercise or purchase price of each outstanding Award, and
(iii) the Shares then included in each outstanding Award granted hereunder, shall be increased,
decreased or changed in like manner, as if the
Shares underlying the Award had been issued and
outstanding, fully paid and non assessable at the
time of such occurrence. The manner in which
Awards are adjusted pursuant to this Section 4.3
is to be determined by the Board or the Committee;
provided that all adjustments must be determined
by the Board or Committee in good faith, and must
be effectuated so as to preserve the value that
any Participant has in outstanding Awards as of
the time of the event giving rise to any potential
dilution or enlargement of rights.
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4.4
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General Adjustment Rules
.
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(a)
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If any adjustment or substitution provided for in this Section 4 shall result
in the creation of a fractional Share under any Award, such fractional Share shall be
rounded to the nearest whole Share and fractional Shares shall not be issued.
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(b)
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In the case of any such substitution or adjustment affecting an Option or a SAR
(including a Nonqualified Share Option) such substitution or adjustments shall be made
in a manner that is in accordance with the substitution and assumption rules set forth
in Treasury Regulations 1.424-1 and the applicable guidance relating to Code section
409A.
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SECTION 5
PARTICIPATION
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5.1
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Basis of Grant
. Participants in the Plan shall be those Service Providers, who, in the
judgment of the Committee, have performed, are performing, or during the term of their
incentive arrangement will perform, important services in the management, operation and
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A-11
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development of the Company, and significantly contribute, or are expected to significantly
contribute, to the achievement of long-term corporate economic objectives.
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5.2
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Types of Grants; Limits.
Participants may be granted from time to time one or more Awards;
provided, however, that the grant of each such Award shall be separately approved by the
Committee or its designee, and receipt of one such Award shall not result in the automatic
receipt of any other Award. Written notice shall be given to such Person, specifying the
terms, conditions, right and duties related to such Award. Under no circumstance shall
Incentive Share Options be granted to (i) non-employee trustees, or (ii) any person not
permitted to receive Incentive Share Options under the Code.
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5.3
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Award Agreements
. Each Participant shall enter into an Award Agreement(s) with the Company,
in such form as the Committee shall determine and which is consistent with the provisions of
the Plan, specifying such terms, conditions, rights and duties. Unless otherwise explicitly
stated in the Award Agreement, Awards shall be deemed to be granted as of the date specified
in the grant resolution of the Committee, which date shall be the date of any related
agreement(s) with the Participant. Unless provided for in a particular Award Agreement that
the terms of the Plan are being superseded, in the event of any inconsistency between the provisions of the Plan and any such Award Agreement(s)
entered into hereunder, the provisions of the Plan shall govern.
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5.4
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Restrictive Covenants
. The Committee may, in its sole and absolute discretion, place certain
restrictive covenants in an Award Agreement requiring the Participant to agree to refrain from
certain actions. Such Restrictive Covenants, if contained in the Award Agreement, will be
binding on the Participant.
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5.5
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Maximum Annual Award.
The maximum number of Shares with respect to which an Award or Awards
may be granted to any Participant in any one taxable year of the Company (the “Maximum Annual
Participant Award”) shall not exceed Seven Hundred Fifty Thousand (750,000) Shares (subject
to adjustment pursuant to Sections 4.3 and 4.4). If an Option is in tandem with a SAR, such
that the exercise of the Option or SAR with respect to a Share cancels the tandem SAR or
Option right, respectively, with respect to each Share, the tandem Option and SAR rights with
respect to each Share shall be counted as covering but one Share for purposes of the Maximum
Annual Participant Award.
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SECTION 6
SHARE OPTIONS
|
6.1
|
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Grant of Options.
A Participant may be granted one or more Options. The Committee in its
sole discretion shall designate whether an Option is an Incentive Share Option or a
Nonqualified Share Option. The Committee may grant both an Incentive Share Option and a
Nonqualified Share Option to the same Participant at the same time or at different times.
Incentive Share Options and Nonqualified Share Options, whether granted at the same or
different times, shall be deemed to have been awarded in separate grants, shall be clearly
identified, and in no event shall the exercise of one Option affect the right to
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A-12
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exercise any
other Option or affect the number of Shares for which any other Option may be exercised.
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6.2
|
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Option Agreements
. Each Option granted under the Plan shall be evidenced by a written Option
Award Agreement which shall be entered into by the Company and the Participant to whom the
Option is granted (the “Optionee”), and which shall contain, or be subject to, the following
terms and conditions, as well as such other terms and conditions not inconsistent therewith,
as the Committee may consider appropriate in each case.
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(a)
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Number of Shares
. Each Option Award Agreement shall state that it covers a
specified number of Shares, as determined by the Committee. To the extent that the
aggregate Fair Market Value of Shares with respect to which Options designated as
Incentive Share Options are exercisable for the first time by any Optionee during any
calendar year exceeds $100,000 or, if different, the maximum limitation in effect at
the time of grant under section 422(d) of the Code, such Options in excess of such
limit shall be treated as Nonqualified Share Options. The foregoing shall be applied
by taking Options into account in the order in which they were granted. For the
purposes of the foregoing, the Fair Market Value of any Share shall be determined as of the time the Option with respect to such Share
is granted. In the event the foregoing results in a portion of an Option designated
as an Incentive Share Option exceeding the $100,000 limitation, only such excess
shall be treated as a Nonqualified Share Option.
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(b)
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Price
. Each Option Award Agreement shall state the Option Exercise Price at
which each Share covered by an Option may be purchased. Such Option Exercise Price
shall be determined in each case by the Committee, but in no event shall the Option
Exercise Price for each Share covered by an Option be less than the Fair Market Value
of the Share on the Option’s Grant Date, as determined by the Committee; provided,
however, that the Option Exercise Price for each Share covered by an Incentive Share
Option granted to an Eligible Employee who then owns Shares possessing more than 10% of
the total combined voting power of all classes of Shares of the Company or any parent
or Subsidiary corporation of the Company must be at least 110% of the Fair Market Value
of the Share subject to the Incentive Share Option on the Option’s Grant Date.
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(c)
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Duration of Options
. Each Option Award Agreement shall state the period of
time, determined by the Committee, within which the Option may be exercised by the
Holder (the “Option Period”). The Option Period must expire, in all cases, not more
than ten years from the Option’s Grant Date; provided, however, that the Option Period
of an Incentive Share Option granted to an Eligible Employee who then owns Shares
possessing more than 10% of the total combined voting power of all classes of Shares of
the Company must expire not more than five years from the Option’s Grant Date. Each
Option Award Agreement shall also state the periods of time, if any, as determined by
the Committee, when incremental portions of each Option shall become exercisable. If
any Option or portion
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A-13
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thereof is not exercised during its Option Period, such
unexercised portion shall be deemed to have been forfeited and have no further force or
effect.
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(d)
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Termination of Service, Death, Disability, etc.
Each Option Agreement shall
state the period of time, if any, determined by the Committee, within which the Vested
Option may be exercised after an Optionee ceases to be a Service Provider on account of
the Participant’s death, Disability, voluntary resignation, retirement, cessation as a
trustee, or the Company having terminated such Optionee’s employment with or without
Cause. A termination of service shall not occur if the Employee is on military leave,
sick leave or other bona fide leave of absence (such as temporary employment by the
government) if the period of such leave does not exceed six months, or if longer, as
long as the Employee’s right to reemployment with the Company or an Affiliate is
provided either by statute or by contract. A Participant’s cessation as an Employee but
continuation as a trustee of the Company will not constitute a termination of service
under the Plan. Unless an Option Agreement provides otherwise, a Participant’s change
in status between serving as an employee and/or trustee will not be considered a
termination of the Participant serving as a Service Provider for purposes of any Option
expiration period under the Plan.
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(e)
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Transferability
. Except as otherwise determined by the Committee, Options
shall not be transferable by the Optionee except by will or pursuant to the laws of
descent and distribution. Each Vested Option shall be exercisable during the
Optionee’s lifetime only by him or her, or in the event of Disability or incapacity, by
his or her guardian or legal representative. Shares issuable pursuant to any Option
shall be delivered only to or for the account of the Optionee, or in the event of
Disability or incapacity, to his or her guardian or legal representative.
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(f)
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Exercise, Payments, etc
.
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(i)
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Unless otherwise provided in the Option Award Agreement, each
Vested Option may be exercised by delivery to the Corporate Secretary of the
Company a written notice specifying the number of Shares with respect to which
such Option is exercised and payment of the Option Exercise Price. Such notice
shall be in a form satisfactory to the Committee or its designee and shall
specify the particular Vested Option that is being exercised and the number of
Shares with respect to which the Vested Option is being exercised. The
exercise of the Vested Option shall be deemed effective upon receipt of such
notice by the Corporate Secretary and payment to the Company. The purchase of
such Shares shall take place at the principal offices of the Company upon
delivery of such notice, at which time the purchase price of the Shares shall
be paid in full by any of the methods or any combination of the methods set
forth in clause (ii) below.
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(ii)
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The Option Exercise Price may be paid by any of the following
methods:
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A-14
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A.
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Cash or certified bank check;
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B.
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By delivery to the Company Shares then owned by
the Holder, the Fair Market Value of which equals the purchase price of
the Shares purchased pursuant to the Vested Option, properly endorsed
for transfer to the Company; provided, however, that Shares used for
this purpose must have been held by the Holder for such minimum period
of time as may be established from time to time by the Committee; and
provided further that the Fair Market Value of any Shares delivered in
payment of the purchase price upon exercise of the Options shall be the
Fair Market Value as of the exercise date, which shall be the date of
delivery of the Shares used as payment of the Option Exercise Price;
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In lieu of actually surrendering to the Company the Shares then owned
by the Holder, the Committee may, in its discretion permit the Holder
to submit to the Company a statement affirming ownership by the
Holder of such number of Shares and request that such Shares,
although not actually surrendered, be deemed to have been surrendered
by the Holder as payment of the exercise price;
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C.
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For any Holder other than an Executive Officer
or except as otherwise prohibited by the Committee, by payment through
a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board; or
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D.
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To the extent the Option Award Agreement so
provides, payment of the Option Exercise Price for shares purchased
pursuant to exercise of an Option may be made in any other form that is
consistent with applicable laws, regulations and rules or any
combination of the consideration provided in the foregoing subsections
(A), (B), and (C).
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(iii)
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The Company may not guarantee a third-party loan obtained by a
Holder to pay any portion of the entire Option Exercise Price of the Shares.
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(g)
|
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Date of Grant
. Unless otherwise specifically specified in the Option Award
Agreement, an option shall be considered as having been granted on the date specified
in the grant resolution of the Committee.
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(h)
|
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Withholding.
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(A)
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Nonqualified Share Options
. Upon any exercise of a
Nonqualified Share Option, the Optionee shall make appropriate arrangements
with the Company to provide for the minimum amount of additional withholding
required by applicable federal and state income tax and payroll laws,
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A-15
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including
payment of such taxes through delivery of Shares or by withholding Shares to be
issued under the Option, as provided in Section 16 hereof.
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(B)
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Incentive Share Options.
In the event that an Optionee makes a
disposition (as defined in Code section 424(c)) of any Shares acquired pursuant
to the exercise of an Incentive Share Option prior to the later of (i) the
expiration of two years from the date on which the Incentive Share Option was
granted or (ii) the expiration of one year from the date on which the Option
was exercised, the Participant shall send written notice to the Company at its
principal office (Attention: Corporate Secretary) of the date of such
disposition, the number of shares disposed of, the amount of proceeds received
from such disposition, and any other information relating to such disposition
as the Company may reasonably request. The Optionee shall, in the event of
such a disposition, make appropriate arrangements with the Company to provide
for the amount of additional withholding, if any, required by applicable
Federal and state income tax laws.
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(i)
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Adjustment of Options.
Subject to the limitations set forth below and those
contained in Sections 4, 6 and 15, the Committee may make any adjustment in the Option
Exercise Price, the number of Shares subject to, or the terms of, an
outstanding Option and a subsequent granting of an Option by amendment or by
substitution of an outstanding Option. Such amendment, substitution, or re-grant
may result in terms and conditions (including Option Exercise Price, number of
Shares covered, vesting schedule or exercise period) that differ from the terms and
conditions of the original Option. The Committee may not, however, adversely affect
the rights of any Optionee to previously granted Options without the consent of such
Optionee. If such action is affected by the amendment, the effective date of such
amendment shall be the date of the original grant. Any adjustment, modification,
extension or renewal of an Option shall be effected such that the Option is either
exempt from, or is compliant with, Code section 409A.
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(j)
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No Option Repricing Without Shareholder Approval
. In no event may the
Committee grant Options in replacement of Options previously granted under this Plan or
any other compensation plan of the Company, or may the Committee amend outstanding
Options (including amendments to adjust an Option price) unless such replacement or
adjustment (i) is subject to and approved by the Company’s shareholders or (ii) would
not be deemed to be a repricing under the rules of the New York Stock Exchange.
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6.3
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Shareholder Privileges
. No Holder shall have any rights as a shareholder with respect to any
Shares covered by an Option until the Holder becomes the holder of record of such Shares, and
no adjustments shall be made for dividends or other distributions or other rights as to which
there is a record date preceding the date such Holder becomes the holder of record of such
Shares, except as provided in Section 4.
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A-16
SECTION 7
SHARE APPRECIATION RIGHTS
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7.1
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Grant of SARs
. Subject to the terms and conditions of this Plan, a SAR may be granted to a
Participant at any time and from time to time as shall be determined by the Committee in its
sole discretion. The Committee may grant Freestanding SARs or Tandem SARs, or any combination
thereof.
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(a)
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Number of Shares
. The Committee shall have complete discretion to determine
the number of SARs granted to any Participant, subject to the limitations imposed in
this Plan and by applicable law.
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(b)
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Exercise Price and Other Terms
. All SARs shall be granted with an exercise
price no less than the Fair Market Value of the underlying Shares on the SARs’ Date of
Grant. The Committee, subject to the provisions of this Plan, shall have complete
discretion to determine the terms and conditions of SARs granted under this Plan. The
exercise price per Share of Tandem SARs shall equal the exercise price per Share of the
related Option.
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7.2
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SAR Award Agreement
. Each SAR granted under the Plan shall be evidenced by a written SAR
Award Agreement which shall be entered into by the Company and the Participant to whom the SAR is granted (the “SAR Holder”), and which shall specify the exercise price per
share, the terms of the SAR, the conditions of exercise, and such other terms and conditions
as the Committee in its sole discretion shall determine.
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7.3
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Exercise of Tandem SARs
. Tandem SARs may be exercised for all or part of the Shares subject
to the related Option upon the surrender of the right to exercise the equivalent portion of
the related Option. A Tandem SAR may be exercised only with respect to the Shares for which
its related Option is then exercisable. With respect to a Tandem SAR granted in connection
with an Incentive Share Option: (a) the Tandem SAR shall expire no later than the expiration
of the underlying Incentive Share Option; (b) the value of the payout with respect to the
Tandem SAR shall be for no more than one hundred percent (100%) of the difference between the
Exercise Price per Share of the underlying Incentive Share Option and the Fair Market Value
per Share of the Shares subject to the underlying Incentive Share Option at the time the
Tandem SAR is exercised; and (c) the Tandem SAR shall be exercisable only when the Fair Market
Value per Share of the Shares subject to the Incentive Share Option exceeds the per share
Option Price per Share of the Incentive Share Option.
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7.4
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Exercise of Freestanding SARs
. Freestanding SARs shall be exercisable on such terms and
conditions as the Committee in its sole discretion shall determine; provided, however, that no
Freestanding SAR granted to a Section 16 Person shall be exercisable until at least six (6)
months after the Date of Grant or such shorter period as may be permissible while maintaining
compliance with Rule 16b-3.
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A-17
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7.5
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Expiration of SARs
. Each SAR Award Agreement shall state the period of time, if any,
determined by the Committee, within which the SAR may be exercised after a SAR Holder ceases
to be a Service Provider on account of the Participant’s death, Disability, voluntary
resignation, cessation as a trustee, or the Company having terminated such SAR Holder’s
employment with or without Cause. Unless otherwise specifically provided for in the SAR Award
agreement, a Tandem SAR granted under this Plan shall be exercisable at such time or times and
only to the extent that the related Option is exercisable. The Tandem SAR shall terminate and
no longer be exercisable upon the termination or exercise of the related Options, except that
Tandem SARs granted with respect to less than the full number of shares covered by a related
Option shall not be reduced until the exercise or termination of the related Option exceeds
the number of Shares not covered by the SARs.
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7.6
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Payment of SAR Amount
. Upon exercise of a SAR, a Holder shall be entitled to receive payment
from the Company in an amount determined by multiplying (i) the positive difference between
the Fair Market Value of a Share on the date of exercise over the exercise price per Share by
(ii) the number of Shares with respect to which the SAR is exercised. The payment upon a SAR
exercise may be in whole Shares of equivalent value, cash, or a combination of whole Shares
and cash. Fractional Shares shall be rounded down to the nearest whole Share.
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SECTION 8
AWARDS OF RESTRICTED SHARE AND RESTRICTED SHARE UNITS
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8.1
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Restricted Share Awards Granted by Committee
. Coincident with or following designation for
participation in the Plan and subject to the terms and provisions of the Plan, the Committee,
at any time and from time to time, may grant Restricted Shares to any Service Provider in such
amounts as the Committee shall determine.
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8.2
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Restricted Share Unit Awards Granted by Committee
. Coincident with or following designation
for participation in the Plan and subject to the terms and provisions of the Plan, the
Committee may grant a Service Provider Restricted Share Units in connection with or separate
from a grant of Restricted Shares. Upon the vesting of Restricted Share Units, the Holder
shall be entitled to receive the full value of the Restricted Share Units payable in either
Shares or cash.
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8.3
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Restrictions
. A Holder’s right to retain Restricted Shares or be paid with respect to
Restricted Share Units shall be subject to such restrictions, including him or her continuing
to perform as a Service Provider for a restriction period specified by the Committee, or the
attainment of specified performance goals and objectives, as may be established by the
Committee with respect to such Award. The Committee may in its sole discretion require
different periods of service or different performance goals and objectives with respect to (i)
different Holders, (ii) different Restricted Shares or Restricted Share Unit Awards, or (iii)
separate, designated portions of the Shares constituting a Restricted Share Award. Any grant
of Restricted Shares or Restricted
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A-18
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Share Units shall contain terms such that the Award is
either exempt from Code section 409A or complies with such section.
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8.4
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Privileges of a Shareholder, Transferability
. Unless otherwise provided in the Award
Agreement, a Participant shall have all voting, dividend, liquidation and other rights with
respect to Restricted Shares. The Committee may provide that any dividends paid on Restricted
Shares prior to such Shares becoming vested shall be held in escrow by the Company and subject
to the same restrictions on transferability and forfeitability as the underlying Restricted
Shares. Any voting, dividend, liquidation or other rights shall accrue to the benefit of a
Holder only with respect to Restricted Shares held by, or for the benefit of, the Holder on
the record date of any such dividend or voting date. A Participant’s right to sell, encumber
or otherwise transfer such Restricted Shares shall, in addition to the restrictions otherwise
provided for in the Award Agreement, be subject to the limitations of Section 12.2 hereof.
The Committee may determine that a Holder of Restricted Shares Units is entitled to receive
dividend equivalent payments on such units. If the Committee determines that Restricted
Shares Units shall receive dividend equivalent payments, such feature will be specified in the
applicable Award Agreement. Restricted Shares Units shall not have any voting rights.
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8.5
|
|
Enforcement of Restrictions.
The Committee may in its sole discretion require one or more of
the following methods of enforcing the restrictions referred to in Section 8.2 and 8.3:
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(a)
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Holding the Restricted Shares in book entry form in the name of the Participant
until the applicable Vesting Date(s), at which time such Shares will be delivered to
the Participant;
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(b)
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Registering the Restricted Shares in the name of the Participant and having the
Participant deposit such Restricted Shares, together with a share power endorsed in
blank, with the Company;
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(c)
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Placing a legend on the Share certificates, as applicable, referring to
restrictions;
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(d)
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Requiring that the Share certificates, duly endorsed, be held in the custody of
a third party nominee selected by the Company who will hold such Restricted Shares on
behalf of the Holder while the restrictions remain in effect; or
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(e)
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Inserting a provision into the Restricted Shares Award Agreement prohibiting
assignment of such Award Agreement until the terms and conditions or restrictions
contained therein have been satisfied or released, as applicable.
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8.6
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Termination of Service, Death, Disability, etc
. Except as otherwise provided in an Award
Agreement or other agreement approved by the Committee to which any Participant is a party, in
the event of the death or Disability of a Participant, all service period and other
restrictions applicable to Restricted Shares Awards then held by him or her shall lapse, and
such Awards shall become fully nonforfeitable. Subject to Section 11, in the event a
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A-19
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Participant ceases to be a Service Provider for any other reason, any Restricted Shares Awards
as to which the service period or other vesting conditions for have not been satisfied shall
be forfeited.
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SECTION 9
PERFORMANCE SHARES, PERFORMANCE UNITS, BONUS SHARES
AND DEFERRED SHARES
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9.1
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Awards Granted by Committee
. Coincident with or following designation for participation in
the Plan, a Participant may be granted Performance Shares or Performance Units.
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9.2
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Terms of Performance Shares or Performance Units
. The Committee shall establish maximum and
minimum performance targets to be achieved during the applicable Performance Period. Each
grant of a Performance Share or Performance Unit Award shall be subject to additional terms
and conditions not inconsistent with the provisions of the Plan. The Committee shall
determine what, if any, payment is due with respect to an Award and whether such payment shall
be made in cash, Shares or some combination.
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9.3
|
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Bonus Shares.
Subject to the terms of the Plan, the Committee may grant Bonus Shares to any
Participant, in such amount and upon such terms and at any time and from time to time as shall
be determined by the Committee.
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9.4
|
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Deferred Shares.
Subject to the terms and provisions of the Plan, Deferred Shares may be
granted to any Participant in such amounts and upon such terms, and at any time and from time
to time, as shall be determined by the Committee. The Committee may impose such conditions or
restrictions on any Deferred Shares as it may deem advisable, including time-vesting
restrictions and deferred payment features. The Committee may cause the Company to establish
a grantor trust to hold Shares subject to Deferred Share Awards. Without limiting the
generality of the foregoing, the Committee may grant to any Participant, or permit any
Participant to elect to receive, Deferred Shares in lieu of or in substitution for any other
compensation (whether payable currently or on a deferred basis, and whether payable under this
Plan or otherwise) which such Participant may be eligible to receive from the Company or a
Subsidiary. Any grant of Deferred Shares shall comply with Section 409A of the Code.
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SECTION 10
PERFORMANCE AWARDS; SECTION 162(M) PROVISIONS
|
10.1
|
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Terms of Performance Awards
. Except as provided in Section 11, Performance Awards will be
issued or granted, or become vested or payable, only after the end of the relevant Performance
Period. The performance goals to be achieved for each Performance Period and the amount of
the Award to be distributed upon satisfaction of those performance goals shall be conclusively
determined by the Committee. When the Committee determines whether a performance goal has
been satisfied for any Performance Period, the Committee, where the Committee deems
appropriate, may make such determination
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A-20
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using calculations which alternatively include and
exclude one, or more than one, “extraordinary items” as determined under U.S. generally
accepted accounting principles, and the Committee may determine whether a performance goal has
been satisfied for any Performance Period taking into account the alternative which the
Committee deems appropriate under the circumstances. The Committee also may take into account
any other unusual or non-recurring items, including the charges or costs associated with
restructurings of the Company, discontinued operations, and the cumulative effects of
accounting changes and, further, may take into account any unusual or non-recurring events
affecting the Company, changes in applicable tax laws or accounting principles or such other
factors as the Committee may determine reasonable and appropriate under the circumstances
(including any factors that could result in the Company’s paying non-deductible compensation
to an Employee or non-employee trustee).
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10.2
|
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Performance Goals
. If an Award is subject to this Section 10, then the lapsing of
restrictions thereon, or the vesting thereof, and the distribution of cash, Shares or other
property pursuant thereto, as applicable, shall be subject to the achievement of one or more
objective performance goals established by the Committee, which shall be based on the
attainment of one or any combination of the following metrics, and which may be established on
an absolute or relative basis for the Company as a whole or any of its subsidiaries, operating
divisions or other operating units:
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(a)
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Earnings (either in the aggregate or on a per-Share basis);
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(b)
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Growth or rate of growth in funds from operations (either in the aggregate or
on a per-Share basis);
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(c)
|
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Growth or rate of growth in earnings (either in the aggregate or on a per-Share
basis);
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(d)
|
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Net income or loss (either in the aggregate or on a per-Share basis);
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(e)
|
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Cash available for distribution per share;
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(f)
|
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Cash flow provided by operations, either in the aggregate or on a per-Share
basis;
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(g)
|
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Growth or rate of growth in cash flow (either in the aggregate or on a
per-Share basis);
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(h)
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Free cash flow (either in the aggregate or on a per-Share basis);
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(i)
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Reductions in expense levels, determined either on a Company-wide basis or in
respect of any one or more business units;
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(j)
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Operating cost management and employee productivity;
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(k)
|
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Return measures (including on assets, equity or invested capital, whether at
the shareholder level , a subsidiary level or an operating unit or division level);
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A-21
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(l)
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Growth or rate of growth in return measures (including return on assets, equity
or invested capital);
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(m)
|
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Share price (including attainment of a specified per-Share price during the
Performance Period; growth measures and total shareholder return or attainment by the
Shares of a specified price for a specified period of time);
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(n)
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Strategic business criteria, consisting of one or more objectives based on
meeting specified revenue, market share, market penetration, geographic business
expansion goals, objectively identified project milestones, cost targets, and goals
relating to acquisitions or divestitures;
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(o)
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EBITDA measures; and/or
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(p)
|
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Achievement of business or operational goals such as market share and/or
business development;
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provided that applicable performance goals may be applied on a pre- or post-tax basis; and
provided further that the Committee may, when the applicable performance goals are
established, provide that the formula for such goals may include or exclude items to measure
specific objectives, such as losses from discontinued operations, extraordinary gains or
losses, the cumulative effect of accounting changes, acquisitions or divestitures, foreign
exchange impacts and any unusual, nonrecurring gain or loss. In addition to the foregoing performance goals, the performance goals shall also include any performance goals
which are set forth in a Company bonus or incentive plan, if any, which has been approved by
the Company’s shareholders, which are incorporated herein by reference. Such performance
goals shall be set by the Committee within the time period prescribed by, and shall
otherwise comply with the requirements of, Code section 162(m).
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10.3
|
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Adjustments
. Notwithstanding any provision of the Plan other than Section 4.3 or Section 11,
with respect to any Award that is subject to this Section 10, the Committee may not adjust
upwards the amount payable pursuant to such Award, nor may it waive the achievement of the
applicable performance goals except in the case of the death or Disability of the Participant.
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10.4
|
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Other Restrictions
. The Committee shall have the power to impose such other restrictions on
Awards subject to this Section 10 as it may deem necessary or appropriate to insure that such
Awards satisfy all requirements for “performance-based compensation” within the meaning of
Code section 162(m)(4)(B).
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10.5
|
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Section
162(m)
Limitations
. Notwithstanding any other provision of this Plan, if the
Committee determines at the time any Award is granted to a Participant that such Participant
is, or is likely to be at the time he or she recognizes income for federal income tax purposes
in connection with such Award, a Covered Employee, then the Committee may provide that this
Section 10 is applicable to such Award.
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A-22
SECTION 11
REORGANIZATION, CHANGE IN CONTROL OR LIQUIDATION
|
11.1
|
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Except as otherwise provided in an Award Agreement or other agreement approved by the
Committee to which any Participant is a party, in the event of a Change in Control all Awards
then outstanding shall become fully exercisable, fully vested or fully payable, as the case
may be, and all restrictions (other than restrictions imposed by law) and conditions on all
Awards then outstanding shall be deemed satisfied as of the date of the Change in Control.
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11.2
|
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In addition to the foregoing, in the event the Company undergoes a Change in Control or in
the event of a corporate merger, consolidation, major acquisition of property (or stock),
separation, reorganization or liquidation in which the Company is a party and in which a
Change in Control does not occur, the Committee, or the board of directors of any corporation
assuming the obligations of the Company, shall have the full power and discretion to take any
one or more of the following actions:
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(a)
|
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Without reducing the economic value of outstanding Awards, modify the terms and
conditions for the exercise of, or settlement of, outstanding Awards granted hereunder;
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(b)
|
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Provide for the purchase by the Company of any Award, upon the Participant’s
request, for, with respect to an Option or SAR, an amount of cash equal to the amount that could have been attained upon the exercise of such Award or realization
of the Participant’s rights had such Award been currently exercisable, or, in the
case of Restricted Shares or Restricted Share Units, the Fair Market Value of such
Shares or Units;
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(c)
|
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Provide that Options or SARs granted hereunder must be exercised in connection
with the closing of such transactions, and that if not so exercised such Options or
SARs will expire;
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(d)
|
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Make such adjustment to any Award that is outstanding as the Committee or Board
deems appropriate to reflect such Change in Control or corporate event; or
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(e)
|
|
Cause any Award then outstanding to be assumed, or new rights of equivalent
economic value substituted therefore, by the acquiring or surviving corporation.
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Any such determinations by the Committee may be made generally with respect to all
Participants, or may be made on a case-by-case basis with respect to particular
Participants. Notwithstanding the foregoing, any transaction undertaken for the purpose of
reincorporating the Company under the laws of another jurisdiction, if such transaction does
not materially affect the beneficial ownership of the Company’s Shares, such transaction
shall not constitute a merger, consolidation, major acquisition of property for stock,
separation, reorganization, liquidation, or Change in Control.
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A-23
SECTION 12
RIGHTS OF EMPLOYEES; PARTICIPANTS
|
12.1
|
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Employment
. Nothing contained in the Plan or in any Award granted under the Plan shall
confer upon any Participant any right with respect to the continuation of his or her services
as a Service Provider or interfere in any way with the right of the Company, subject to the
terms of any separate employment or consulting agreement to the contrary, at any time to
terminate such services or to increase or decrease the compensation of the Participant from
the rate in existence at the time of the grant of an Award. Whether an authorized leave of
absence, or absence in military or government service, shall constitute a termination of
Participant’s services as a Service Provider shall be determined by the Committee at the time.
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12.2
|
|
Nontransferability
. Except as provided in Section 12.3, no right or interest of any Holder
in an Award granted pursuant to the Plan shall be assignable or transferable during the
lifetime of the Participant, either voluntarily or involuntarily, or be subjected to any lien,
directly or indirectly, by operation of law, or otherwise, including execution, levy,
garnishment, attachment, pledge or bankruptcy. In the event of a Participant’s death, a
Holder’s rights and interests in all Awards shall, to the extent not otherwise prohibited
hereunder, be transferable by testamentary will or the laws of descent and distribution, and
payment of any amounts due under the Plan shall be made to, and exercise of any Options or
SARs may be made by, the Holder’s legal representatives, heirs or legatees. If, in the
opinion of the Committee, a person entitled to payments or to exercise rights with respect to the Plan is disabled from caring for his or her affairs because of a mental condition,
physical condition or age, payment due such person may be made to, and such rights shall be
exercised by, such person’s guardian, conservator, or other legal personal representative
upon furnishing the Committee with evidence satisfactory to the Committee of such status.
“Transfers” shall not be deemed to include transfers to the Company or “cashless exercise”
procedures with third parties who provide financing for the purpose of (or who otherwise
facilitate) the exercise of Awards consistent with applicable laws and the authorization of
the Committee.
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12.3
|
|
Permitted Transfers
. Pursuant to conditions and procedures established by the Committee from
time to time, the Committee may permit Awards to be transferred to, exercised by and paid to
certain persons or entities related to a Participant, including members of the Participant’s
immediate family, charitable institutions, or trusts or other entities whose beneficiaries or
beneficial owners are members of the Participant’s immediate family and/or charitable
institutions (a “Permitted Transferee”). In the case of initial Awards, at the request of the
Participant, the Committee may permit the naming of the related person or entity as the Award
recipient. Any permitted transfer shall be subject to the condition that the Committee
receive evidence satisfactory to it that the transfer is being made for estate and/or tax
planning purposes on a gratuitous or donative basis and without consideration (other than
nominal consideration). Notwithstanding the foregoing, Incentive Share Options shall only be
transferable to the extent permitted in Section 422 of the Code, or such successor provision
thereto, and the treasury regulations thereunder.
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A-24
SECTION 13
GENERAL RESTRICTIONS
|
13.1
|
|
Investment Representations
. The Company may require any person to whom an Option or other
Award is granted, as a condition of exercising such Option or receiving Shares under the
Award, to give written assurances in substance and form satisfactory to the Company and its
counsel to the effect that such person is acquiring the Shares subject to the Option or the
Award for his or her own account for investment and not with any present intention of selling
or otherwise distributing the same, and to such other effects as the Company deems necessary
or appropriate in order to comply with federal and applicable state securities laws. Legends
evidencing such restrictions may be placed on the certificates evidencing the Shares.
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13.2
|
|
Compliance with Securities Laws
.
|
|
|
(a)
|
|
Each Award shall be subject to the requirement that, if at any time counsel to
the Company shall determine that the listing, registration or qualification of the
Shares subject to such Award upon any securities exchange or under any state or federal
law, or the consent or approval of any governmental or regulatory body, is necessary as
a condition of, or in connection with, the issuance or purchase of Shares thereunder,
such Award may not be accepted or exercised in whole or in part unless such listing,
registration, qualification, consent or approval shall have been effected or obtained
on conditions acceptable to the Committee. Nothing herein shall be deemed to require the Company to apply for or to obtain such
listing, registration or qualification.
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(b)
|
|
Each Holder who is a trustee or an Executive Officer is restricted from taking
any action with respect to any Award if such action would result in a (i) violation of
Section 306 of the Sarbanes-Oxley Act of 2002, and the regulations promulgated
thereunder, whether or not such law and regulations are applicable to the Company, or
(ii) any policies adopted by the Company restricting transactions in the Shares.
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|
13.3
|
|
Share Restriction Agreement
. The Committee may provide that Shares issuable upon the
exercise of an Option shall, under certain conditions, be subject to restrictions whereby the
Company has (i) a right of first refusal with respect to such Shares, (ii) specific rights or
limitations with respect to the Participant’s ability to vote such Shares, or (iii) a right or
obligation to repurchase all or a portion of such Shares, which restrictions may survive a
Participant’s cessation or termination as a Service Provider.
|
SECTION 14
OTHER EMPLOYEE BENEFITS
The amount of any compensation deemed to be received by a Participant as a result of the exercise
of an Option or the grant, payment or vesting of any other Award shall not constitute “earnings”
with respect to which any other benefits of such Participant are determined, including
A-25
benefits
under (a) any pension, profit sharing, life insurance or salary continuation plan or other employee
benefit plan of the Company or (b) any agreement between the Company and the Participant, except as
such plan or agreement shall otherwise expressly provide.
SECTION 15
PLAN AMENDMENT, MODIFICATION AND TERMINATION
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15.1
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Amendment, Modification, and Termination
. The Board may at any time terminate, and from time
to time may amend or modify, the Plan; provided, however, that no amendment or modification
may become effective without approval of the amendment or modification by the shareholders if
shareholder approval is required to enable the Plan to satisfy any applicable statutory or
regulatory requirements, to comply with the requirements for listing on any exchange where the
Shares are listed, or if the Company, on the advice of counsel, determines that shareholder
approval is otherwise necessary or desirable.
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15.2
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Adjustment Upon Certain Unusual or Nonrecurring Events
. The Board may make adjustments in
the terms and conditions of Awards in recognition of unusual or nonrecurring events (including
the events described in Section 4.3) affecting the Company or the financial statements of the
Company or of changes in applicable laws, regulations, or accounting principles, whenever the
Board determines that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available under the
Plan.
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15.3
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Awards Previously Granted
. Notwithstanding any other provision of the Plan to the contrary
(but subject to a Holder’s employment being terminated for Cause and Section 15.2), no
termination, amendment or modification of the Plan shall adversely affect in any material way
any Award previously granted under the Plan, without the written consent of the Holder of such
Award.
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SECTION 16
WITHHOLDING
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16.1
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Withholding Requirement
. The Company’s obligations to deliver Shares upon the exercise of an
Option, or upon the vesting of any other Award, shall be subject to the Participant’s
satisfaction of all applicable federal, state and local income and other tax withholding
requirements.
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16.2
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Withholding with Shares
. The Committee may, in its sole discretion, permit the Holder to pay
all minimum required amounts of tax withholding, or any part thereof, by electing to transfer
to the Company, or to have the Company withhold from the Shares otherwise issuable to the
Holder, Shares having a value not to exceed the minimum amount required to be withheld under
federal, state or local law or such lesser amount as may be elected by the Holder. The
Committee may require that any shares transferred to the Company have been held or owned by
the Participant for a minimum period of time. All elections shall be subject to the approval
or disapproval of the Committee. The value of Shares to be
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withheld shall be based on the Fair
Market Value of the Shares on the date that the amount of tax to be withheld is to be
determined (the “Tax Date”), as determined by the Committee. Any such elections by Holder to
have Shares withheld for this purpose will be subject to the following restrictions:
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(a)
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All elections must be made prior to the Tax Date;
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(b)
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All elections shall be irrevocable; and
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(c)
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If the Participant is an officer or director of the Company within the meaning
of Section 16 of the 1934 Act (“Section 16”), the Participant must satisfy the
requirements of such Section 16 and any applicable rules thereunder with respect to the
use of Shares to satisfy such tax withholding obligation.
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SECTION 17
NONEXCLUSIVITY OF THE PLAN
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17.1
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Nonexclusivity of the Plan.
Neither the adoption of the Plan nor the submission of the Plan
to shareholders of the Company for approval shall be construed as creating any limitations on
the power or authority of the Board or of the Committee to continue to maintain or adopt such
other or additional incentive or other compensation arrangements of whatever nature as the
Board or the Committee, as the case may be, may deem necessary or desirable, or to preclude or
limit the continuation of any other plan, practice or arrangement for the payment of
compensation or fringe benefits to employees or non-employee trustees generally, or to any class or group of employees or non-employee trustees,
which the Company now has lawfully put into effect, including any retirement, pension,
savings and share purchase plan, insurance, death and disability benefits and executive
short-term incentive plans.
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SECTION 18
REQUIREMENTS OF LAW
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18.1
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Requirements of Law
. The issuance of Shares and the payment of cash pursuant to the Plan
shall be subject to all applicable laws, rules and regulations, and to such approvals by any
governmental agencies or stock exchanges as may be required. Notwithstanding any provision of
the Plan or any Award, Holders shall not be entitled to exercise or receive benefits under any
Award, and the Company shall not be obligated to deliver any Shares or other benefits to a
Holder, if such exercise, receipt of benefits or delivery would constitute a violation by the
Holder or the Company of any applicable law or regulation.
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18.2
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Code Section 409A
. This Plan is intended to meet or to be exempt from the requirements of
Section 409A of the Code, and shall be administered, construed and interpreted in a manner
that is in accordance with and in furtherance of such intent. Any provision of this Plan that
would cause an Award to fail to satisfy Section 409A of the Code or, if applicable, an
exemption from the requirements of that Section, shall be amended (in a manner that as closely
as practicable achieves the original intent of this Plan) to comply
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with Section 409A of the
Code or any such exemption on a timely basis, which may be made on a retroactive basis, in
accordance with regulations and other guidance issued under Section 409A of the Code.
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18.3
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Rule 16b-3
. Each transactions under the Plan is intended to comply with all applicable
conditions of Rule 16b-3 to the extent Rule 16b-3 reasonably may be relevant or applicable to
such transaction. To the extent any provision of the Plan or any action by the Committee
under the Plan fails to so comply, such provision or action shall, without further action by
any person, be deemed to be automatically amended to the extent necessary to effect compliance
with Rule 16b-3; provided, however, that if such provision or action cannot be amended to
effect such compliance, such provision or action shall be deemed null and void to the extent
permitted by law and deemed advisable by the Committee.
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18.4
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Governing Law
. The Plan and all agreements hereunder shall be construed in accordance with
and governed by the laws of the state of Maryland without giving effect to the principles of
the conflict of laws to the contrary.
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SUBJECT TO THE SHAREHOLDER APPROVAL REQUIREMENT NOTED BELOW, THIS ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN HEREBY IS ADOPTED BY THE BOARD OF TRUSTEES OF ENTERTAINMENT PROPERTIES
TRUST THIS 2ND DAY OF APRIL, 2007.
THE PLAN SHALL BECOME EFFECTIVE ONLY IF APPROVED BY THE SHAREHOLDERS OF THE COMPANY AND THE EFFECTIVE DATE OF THE PLAN SHALL BE SUCH DATE OF SHAREHOLDER
APPROVAL.
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ENTERTAINMENT PROPERTIES TRUST
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By:
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/s/ David M. Brain
David M. Brain, President and Chief Executive
Officer
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A-28
Exhibit 10.2
Form of NQSO Agreement for Employee Trustees
ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
Nonqualified Share Option Agreement
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Date of Grant:
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Number of Shares to
Which Option Relates:
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Option Exercise Price per Share:
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(Representing 100% of the Fair
Market Value on the Date of Grant)
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$
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This Agreement
dated ___________, is made by and between Entertainment
Properties Trust, a Maryland real estate investment trust (the “Company”), and ___________
(the “Optionee”).
RECITALS:
A.
Effective May 9, 2007, the Company’s shareholders approved the Entertainment
Properties Trust 2007 Equity Incentive Plan (the “Plan”) pursuant to which the Company may, from
time to time, grant options to key employees and non-employee directors of the Company to purchase
shares of beneficial interests in the Company.
B. The Optionee is an employee of the Company and the Company desires to grant to the Optionee
a nonqualified share option to purchase shares of beneficial interests in the Company on the terms
and conditions reflected in this Option Agreement, the Plan and as otherwise established by the
Committee.
AGREEMENT:
In consideration of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties agree as follows:
1.
Incorporation of Plan
. All provisions of this Option Agreement and the rights of
the Optionee are subject in all respects to the provisions of the Plan and the powers of the
Committee therein provided. Capitalized terms used in this Option Agreement but not defined will
have the meaning set forth in the Plan.
2.
Grant of Nonqualified Share Option
. As of the Date of Grant identified above, the
Company grants the Optionee, subject to this Agreement and the Plan, the right, privilege and
option (the “Option”) to purchase, in one or more exercises, all or any part of that number of
Shares identified above opposite the heading “Number of Shares to Which Option Relates” (the
“Option Shares”), at the per Share price specified above opposite the heading “Option Exercise
Price per Share”.
3.
Consideration to the Company
. In consideration of the granting of this Option by
the Company, the Optionee agrees to render faithful and efficient services as an employee of the
Company. Nothing in this Agreement or in the Plan will confer upon the Optionee any right to
continue as an employee of the Company or will interfere with or restrict in any way the rights of
the Company, which are hereby expressly reserved, to terminate the Optionee employment with the
Company at any time for any reason whatsoever, with or without cause.
4.
Exercisability of Option
. During the Optionee’s lifetime, this Option may be
exercised only by the Optionee. This Option, except as specifically provided elsewhere under the
terms of the Plan, shall vest and become exercisable as follows:
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Years Elapsed from Date of Grant
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Percentage Exercisable
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[insert vesting schedule]
For purposes of this Section 4, a year shall mean a period of 365 days (or 366 days in the
event of a leap year). Notwithstanding the above Option vesting schedule, this Option will become
fully exercisable upon the Optionee’s death or Disability provided the Option has not otherwise
expired, been cancelled or terminated.
5.
Method of Exercise
. Provided this Option has not expired, been terminated or
cancelled in accordance with the terms of the Plan, the portion of this Option which is otherwise
exercisable pursuant to Section 4 may be exercised in whole or in part, from time to time by
delivery to the Company or its designee a written notice which will:
(a) set forth the number of Shares with respect to which the Option is to be exercised;
(b) if the person exercising this Option is not the Optionee, be accompanied by
satisfactory evidence of such person’s right to exercise this Option; and
(c) be accompanied by payment in full of the Option Exercise Price in the form of cash,
or a certified bank check made payable to the order of the Company or any other means
allowable under the Plan which the Company in its sole discretion determines will provide
legal consideration for the Shares.
6.
Expiration of Option
. Unless terminated earlier in accordance with the terms of
this Option Agreement or the Plan, the Option granted herein will expire at 5:00 P.M., Central
Standard Time, on the 10th Anniversary of the Date of Grant (the “Expiration Date”). If the
Expiration Date is a day on which the Company is not open for business, then the Option granted
herein will expire, unless earlier terminated in accordance with the terms of this Option Agreement
or the Plan, at 5:00 P.M., Central Standard Time, on the first business day before such Expiration
Date.
2
7.
Effect of Separation from Service
. If the Optionee ceases to be an employee of the
Company for any reason, including cessation by death or Disability, the effect of such termination
of employment on all or any portion of this Option is as provided below. Notwithstanding anything
below to the contrary, in no event may the Option be exercised after the Expiration Date.
(a) If the Optionee’s employment is terminated for Cause, the Option will immediately
be forfeited as of the time of such termination.
(b) If the Optionee ceases to be an employee of the Company due to the Optionee’s
resignation or termination of employment by the Company not for Cause, the portion of this
Option which was otherwise exercisable pursuant to Section 4 on the date of such termination
of employment may be exercised by the Optionee at any time prior to 5:00 P.M., Central
Standard Time, on the 90th calendar day following the effective date of the Optionee’s
termination of employment. If such 90
th
day is not a business day, then the
Option will expire at 5:00 P.M., Central Standard Time, on the first business day
immediately following such 90
th
day.
(c) If the Optionee ceases to be an employee of the Company due to the Optionee’s death
or Disability, the Option may be exercised by the Optionee at any time prior to 5:00 P.M.,
Central Standard Time, on the first anniversary of the effective date of the Optionee’s
termination of employment. If the first anniversary is not a business day, then the Option
will expire at 5:00 P.M., Central Standard Time, on the first business day immediately
following such first anniversary.
(d) If the Optionee dies or become disabled during the 90-day period set forth above in
Section 7(b), or the Optionee dies during the one-year period set forth above in Section
7(c) following the Optionee’s disability, the Option may be exercised by the Optionee (or
the Optionee’s designated beneficiary) at any time prior to 5:00 P.M., Central Standard
Time, on the later of the 180
th
day following the Optionee’s death or the date
the Option could have been exercised under Section 7(c) above.
8.
Notices
. Any notice to be given under the terms of this Agreement to the Company
will be addressed to the Secretary of the Company at 30 West Pershing Road, Suite 201, Kansas City,
Missouri 64108, and any notice to be given to the Optionee will be addressed to him or her at the
address given beneath his or her signature hereto. By a notice given pursuant to this Section 8,
either party may hereafter designate a different address for notices to be given to him or her.
Any notice which is required to be given to the Optionee will, if the Optionee is then deceased, be
given to the Optionee’s personal representative if such representative has previously informed the
Company of his or her status and address by written notice under this Section 8. Any notice will
be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid,
deposited (with postage prepaid) in a post office or branch post office regularly maintained by the
United States Postal Service.
9.
Nontransferability
. Except as otherwise provided in this Agreement or in the Plan,
the Option and the rights and privileges conferred hereby will not be transferred, assigned,
pledged or hypothecated in any way (whether by operation of law or otherwise) and will not be
subject to execution, attachment, or similar process. Upon any attempt to transfer, assign,
pledge, hypothecate or otherwise dispose of the Option, or of any right or privilege conferred hereby, or
upon the levy of any attachment or similar process upon the rights and privileges conferred hereby,
3
contrary to the provisions hereby, this Option and the rights and privileges conferred hereby will
immediately become null and void.
10.
Status of Optionee
. The Optionee shall not be deemed a shareholder of the Company
with respect to any of the Shares subject to this Option, except for those Shares that have been
purchased and issued to him or her. The Company shall not be required to issue or transfer any
certificates for Shares purchased upon exercise of this Option until all applicable requirements of
law have been complied with and, if applicable, such Shares shall have been duly listed on any
securities exchange on which the Shares may then be listed.
11.
Titles
. Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
12.
Amendment
. This Agreement may be amended only by a writing executed by the
parties hereto which specifically states that it is amending this Agreement.
13.
Governing Law
. The laws of the State of Maryland will govern the interpretation,
validity and performance of the terms of this Agreement regardless of the law that might be applied
under principles of conflicts of laws.
14.
Binding Effect
. Except as expressly stated herein to the contrary, this Agreement
will be binding upon and inure to the benefit of the respective heirs, legal representatives,
successors and assigns of the parties hereto.
This Agreement has been executed and delivered by the parties hereto.
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The Company:
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The Optionee:
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Entertainment Properties Trust
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By:
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Name:
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Title:
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Address of the Optionee:
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4
Exhibit 10.3
Form of NQSO Agreement for Non-Employee Trustees
ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
Nonqualified Share Option Agreement
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Date of Grant:
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Number of Shares to Which Option Relates:
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Option Exercise Price per Share:
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(Representing 100% of the Fair Market Value on the Date of Grant)
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$
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This Agreement
dated
, is made by and between Entertainment
Properties Trust, a Maryland real estate investment trust (the “Company”), and
(the “Optionee”).
RECITALS:
A.
Effective May 9, 2007, the Company’s shareholders approved the Entertainment
Properties Trust 2007 Equity Incentive Plan (the “Plan”) pursuant to which the Company may, from
time to time, grant options to key employees and non-employee trustees of the Company to purchase
shares of beneficial interests in the Company.
B. The Optionee is an non-employee trustee of the Company and the Company desires to grant to
the Optionee a nonqualified share option to purchase shares of beneficial interests in the Company
on the terms and conditions reflected in this Option Agreement, the Plan and as otherwise
established by the Committee.
AGREEMENT:
In consideration of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties agree as follows:
1.
Incorporation of Plan
. All provisions of this Option Agreement and the rights of
the Optionee are subject in all respects to the provisions of the Plan and the powers of the
Committee therein provided. Capitalized terms used in this Option Agreement but not defined will
have the meaning set forth in the Plan.
2.
Grant of Nonqualified Share Option
. As of the Date of Grant identified above, the
Company grants the Optionee, subject to this Agreement and the Plan, the right, privilege and
option (the “Option”) to purchase, in one or more exercises, all or any part of that number of
Shares identified above opposite the heading “Number of Shares to Which Option Relates” (the
“Option Shares”), at the per Share price specified above opposite the heading “Option Exercise
Price per Share”.
3.
Consideration to the Company
. In consideration of the granting of this Option by
the Company, the Optionee agrees to render faithful and efficient services as a non- employee
trustee of
the Company. Nothing in this Agreement or in the Plan will confer upon the Optionee any
right to continue as a non-eemployee trustee of the Company.
4.
Exercisability of Option
. During the Optionee’s lifetime, this Option may be
exercised only by the Optionee. This Option, except as specifically provided elsewhere under the
terms of the Plan, shall vest and become exercisable as follows:
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Years Elapsed from Date of Grant
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Percentage Exercisable
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[insert vesting schedule]
For purposes of this Section 4, a year shall mean a period of 365 days (or 366 days in the
event of a leap year). Notwithstanding the above Option vesting schedule, this Option will become
fully exercisable upon the Optionee’s death or Disability provided the Option has not otherwise
expired, been cancelled or terminated.
5.
Method of Exercise
. Provided this Option has not expired, been terminated or
cancelled in accordance with the terms of the Plan, the portion of this Option which is otherwise
exercisable pursuant to Section 4 may be exercised in whole or in part, from time to time by
delivery to the Company or its designee a written notice which will:
(a) set forth the number of Shares with respect to which the Option is to be exercised;
(b) if the person exercising this Option is not the Optionee, be accompanied by
satisfactory evidence of such person’s right to exercise this Option; and
(c) be accompanied by payment in full of the Option Exercise Price in the form of cash,
or a certified bank check made payable to the order of the Company or any other means
allowable under the Plan which the Company in its sole discretion determines will provide
legal consideration for the Shares.
6.
Expiration of Option
. Unless terminated earlier in accordance with the terms of
this Option Agreement or the Plan, the Option granted herein will expire at 5:00 P.M., Central
Standard Time, on the 10th Anniversary of the Date of Grant (the “Expiration Date”). If the
Expiration Date is a day on which the Company is not open for business, then the Option granted
herein will expire, unless earlier terminated in accordance with the terms of this Option Agreement
or the Plan, at 5:00 P.M., Central Standard Time, on the first business day before such Expiration
Date.
7.
Effect of Separation from Service
. If the Optionee ceases to be a member of the
Board of Trustees of the Company for any reason, including cessation by death or Disability, the
effect of such termination on all or any portion of this Option is as provided below.
Notwithstanding anything below to the contrary, in no event may the Option be exercised after the
Expiration Date.
(a) If the Optionee ceases to be a member of the Board of Trustees within the Option
Period for Cause, the Option will immediately be forfeited as of the time of such
termination.
(b) Except as provided in Section 7(d) below, if the Optionee ceases to be a member of
the Board of Trustees due to the Optionee’s voluntary resignation before expiration of the
Optionee’s term as a member of the Board of Trustees, the Option may be exercised by the
2
Optionee at any time prior to 5:00 P.M., Central Standard Time, on the ninetieth (90th)
calendar day following the Optionee’s cessation as a member of the Board of Trustees. If
such ninetieth (90th) day shall not be a business Day, then the Option shall expire at 5:00
P.M., Central Standard Time, on the first (1st) business day immediately following such
ninetieth (90
th
) day
(c) If the Optionee ceases to be a member of the Board of Trustees due to the
expiration of the term of office for such Optionee and such Optionee is not then re-elected
as a member of the Board of Trustees, or is removed as a member of the Board of Trustees
during such Optionee’s term without Cause, the Option may be exercised by the Optionee at
any time prior to 5:00 P.M., Central Standard Time, on the third (3rd) anniversary of the
last date of the Optionee’s term of office. If such day shall not be a business day, then
the Option shall expire at 5:00 P.M., Central Standard Time, on the first (1st) business day
immediately following such third (3rd) anniversary.
(d) If the Optionee dies or becomes Disabled (A) while he or she is a member of the
Board of Trustees, or (B) within the ninety (90) day period referred to in Section 7(b)
above, or (C) within the three-year period referred to in Section 7(c) above, the Option may
be exercised by the Optionee or the Optionee’s Beneficiaries entitled to do so at any time
prior to 5:00 P.M., Central Standard Time, on the 365
th
calendar day following
the date of the Optionee’s death or Disability, if (in the case of (C) above) such date is
later than the date provided for in Section 6.1.3 If the 365
th
day is not a
business day, then the Option shall expire at 5:00 P.M., Central Standard Time, on the first
(1st) business day immediately following such 365
th
day.
8.
Notices
. Any notice to be given under the terms of this Agreement to the Company
will be addressed to the Secretary of the Company at 30 West Pershing Road, Suite 201, Kansas City,
Missouri 64108, and any notice to be given to the Optionee will be addressed to him or her at the
address given beneath his or her signature hereto. By a notice given pursuant to this Section 8,
either party may hereafter designate a different address for notices to be given to him or her.
Any notice which is required to be given to the Optionee will, if the Optionee is then deceased, be
given to the Optionee’s personal representative if such representative has previously informed the
Company of his or her status and address by written notice under this Section 8. Any notice will
be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid,
deposited (with postage prepaid) in a post office or branch post office regularly maintained by the
United States Postal Service.
9.
Nontransferability
. Except as otherwise provided in this Agreement or in the Plan,
the Option and the rights and privileges conferred hereby will not be transferred, assigned,
pledged or hypothecated in any way (whether by operation of law or otherwise) and will not be
subject to execution, attachment, or similar process. Upon any attempt to transfer, assign,
pledge, hypothecate or otherwise dispose of the Option, or of any right or privilege conferred
hereby, or upon the levy of any attachment or similar process upon the rights and privileges
conferred hereby, contrary to the provisions hereby, this Option and the rights and privileges
conferred hereby will immediately become null and void.
10.
Status of Optionee
. The Optionee shall not be deemed a shareholder of the Company
with respect to any of the Shares subject to this Option, except for those Shares that have been
purchased and issued to him or her. The Company shall not be required to issue or transfer any
certificates for Shares purchased upon exercise of this Option until all applicable requirements of
law have been complied with and, if applicable, such Shares shall have been duly listed on any
securities exchange on which the Shares may then be listed.
11.
Titles
. Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
3
12.
Amendment
. This Agreement may be amended only by a writing executed by the
parties hereto which specifically states that it is amending this Agreement.
13.
Governing Law
. The laws of the State of Maryland will govern the interpretation,
validity and performance of the terms of this Agreement regardless of the law that might be applied
under principles of conflicts of laws.
14.
Binding Effect
. Except as expressly stated herein to the contrary, this Agreement
will be binding upon and inure to the benefit of the respective heirs, legal representatives,
successors and assigns of the parties hereto.
This Agreement has been executed and delivered by the parties hereto.
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The Company:
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The Optionee:
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Entertainment Properties Trust
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By:
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Name:
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Title:
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Address of the Optionee:
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4
Exhibit 10.4
Form of Restricted Stock Agreement
Employee
ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
Restricted Shares Agreement
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Date of Grant:
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Number of Restricted Shares Granted:
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This Agreement dated
, is made by and between Entertainment
Properties Trust, a Maryland real estate investment trust (the “Company”), and
(“Participant”).
RECITALS:
A.
Effective May 9, 2007, the Company’s shareholders approved the Entertainment
Properties Trust 2007 Equity Incentive Plan (the “Plan”) pursuant to which the Company may, from
time to time, grant Restricted Shares to eligible Employees o of the Company.
B. Participant is an Employee of the Company or one of its Affiliates and the Company desires
to encourage him/her to own Shares and to give him/her added incentive to advance the interests of
the Company, and desires to grant Participant Restricted Shares of the Company under the terms and
conditions established by the Committee.
AGREEMENT:
In consideration of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties agree as follows:
1.
Incorporation of Plan
. All provisions of this Award Agreement and the rights of
Participant hereunder are subject in all respects to the provisions of the Plan and the powers of
the Committee therein provided. Capitalized terms used in this Agreement but not defined shall
have the meaning set forth in the Plan.
2.
Grant of Restricted Shares
. Subject to the conditions and restrictions set forth
in this Agreement and in the Plan, the Company hereby grants to Participant that number of Shares
identified above opposite the heading “Number of Restricted Shares Granted” (the “Restricted
Shares”).
3.
Restrictions on Transfer/Vesting Date
. Subject to any exceptions set forth in this
Agreement or in the Plan, the Restricted Shares or the rights relating thereto may not be sold,
transferred, gifted, bequeathed, pledged, assigned, or otherwise alienated or hypothecated,
voluntarily or involuntarily, prior to the vesting date(s) for such Restricted Shares (the “Vesting
Date”), as identified below. On the applicable Vesting Date for the designated number of
Restricted Shares, the restriction on transfer and risk of forfeiture on such Restricted Shares
shall lapse and the Restricted Shares, if not previously forfeited pursuant to Section 4 below,
will become freely transferable under this Agreement and the Plan, subject only to such further
limitations on transfer, if any, as may exist under applicable law or any other agreement binding
upon Participant. Subject to any exceptions listed in this Agreement or in the Plan, the
Restricted Shares shall become vested in accordance with the schedule set forth below:
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Anniversary of Date of Grant
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Number/Percentage of Restricted Shares Vested
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[Insert Vesting Schedule]
The Committee may, in its sole discretion, accelerate the Vesting Date(s) for any or all of
the Restricted Shares, if in its judgment the performance of Participant has warranted such
acceleration and/or such acceleration is in the best interests of the Company.
4.
Possible Forfeiture Prior to Vesting
. Unless otherwise provided below, if
Participant’s employment with the Company or any of its Affiliates is terminated prior to the
Vesting Date for one or more of the Restricted Shares, Participant will thereupon immediately
forfeit any and all unvested Restricted Shares, and the full ownership of such Restricted Shares
and rights will revert to the Company. Upon such forfeiture, Participant shall have no further
rights under this Agreement. For purposes of this Agreement, transfer of employment between the
Company and any of its Affiliates (or between Affiliates) does not constitute a termination of
Participant’s employment. If Participant’s employment with the Company or any of its Affiliates is
terminated by the Company or any of its Affiliates prior to the Vesting Date and due to
Participant’s death or Disability, all restrictions on the Restricted Shares will lapse and cease
to be effective, as of the date of termination of Participant’s employment..
5.
Delivery of Shares
. The Restricted Shares shall be held in book entry form by the
Company until the Vesting Dates. Upon the lapse of the restrictions, the Company shall cause a
share certificate to be delivered to Participant with respect to such Shares, free of all
restrictions hereunder.
6.
Dividends and Voting
. Participant is entitled to (i) receive all dividends,
payable in stock, in cash or in kind, or other distributions, declared on or with respect to any
Restricted Shares as of a record date that occurs on or after the Date of Grant hereunder and
before any transfer or forfeiture of the Restricted Shares by Participant and payable at the same
time such dividends and distributions are made to the Company’s shareholders and (ii) exercise all
voting rights with respect to the Restricted Shares, if the record date for the exercise of such
voting rights occurs on or after the Date of Grant hereunder and prior to any transfer or
forfeiture of such Restricted Shares.
2
7.
Titles
. Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
8.
Notice of I.R.C. Section 83(b) Election
. If Participant makes an election under
Section 83(b) of the Code, Participant shall promptly notify the Company of such election and
Participant shall be responsible for all reporting obligations to the Internal Revenue Service.
9.
Amendment
. This Agreement may be amended only by a writing executed by the parties
hereto which specifically states that it is amending this Agreement.
10.
Governing Law
. The laws of the State of Maryland will govern the interpretation,
validity and performance of this Agreement regardless of the law that might be applied under
principles of conflicts of laws.
11.
Binding Effect
. Except as expressly stated herein to the contrary, this Agreement
will be binding upon and inure to the benefit of the respective heirs, legal representatives,
successors and assigns of the parties hereto.
This Agreement has been executed and delivered by the parties hereto.
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The Company:
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Participant:
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Entertainment Properties Trust
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By:
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Name:
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Title:
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Address of Participant:
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3
Exhibit 10.5
Form of Restricted Stock Agreement
Non-Employee Trustee
ENTERTAINMENT PROPERTIES TRUST
2007 EQUITY INCENTIVE PLAN
Restricted Shares Agreement
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Number of Restricted Shares Granted:
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This Agreement
dated
, is made by and between Entertainment
Properties Trust, a Maryland real estate investment trust (the “Company”), and
(“Participant”).
RECITALS:
A.
Effective May 9, 2007, the Company’s shareholders approved the Entertainment
Properties Trust 2007 Equity Incentive Plan (the “Plan”) pursuant to which the Company may, from
time to time, grant Restricted Shares to eligible non-Employee trustees of the Company.
B. Participant is a non-Employee trustee of the Company or one of its Affiliates and the
Company desires to encourage him/her to own Shares and to give him/her added incentive to advance
the interests of the Company, and desires to grant Participant Restricted Shares of the Company
under the terms and conditions established by the Committee.
AGREEMENT:
In consideration of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties agree as follows:
1.
Incorporation of Plan
. All provisions of this Award Agreement and the rights of
Participant hereunder are subject in all respects to the provisions of the Plan and the powers of
the Committee therein provided. Capitalized terms used in this Agreement but not defined shall
have the meaning set forth in the Plan.
2.
Grant of Restricted Shares
. Subject to the conditions and restrictions set forth
in this Agreement and in the Plan, the Company hereby grants to Participant that number of Shares
identified above opposite the heading “Number of Restricted Shares Granted” (the “Restricted
Shares”).
3.
Restrictions on Transfer/Vesting Date
. Subject to any exceptions set forth in this
Agreement or in the Plan, the Restricted Shares or the rights relating thereto may not be sold,
transferred, gifted, bequeathed, pledged, assigned, or otherwise alienated or hypothecated,
voluntarily or involuntarily, prior to the vesting date(s) for such Restricted Shares (the “Vesting
Date”), as identified below. On the applicable Vesting Date for the designated number of
Restricted Shares, the restriction on transfer and risk of forfeiture on such Restricted Shares
shall lapse and the Restricted Shares, if not previously forfeited pursuant to Section 4 below,
will become freely transferable under this Agreement and the Plan, subject only to such further
limitations on transfer, if any, as may exist under applicable law or any other agreement binding
upon Participant. Subject to any exceptions listed in this Agreement or in the Plan, the
Restricted Shares shall become vested in accordance with the schedule set forth below:
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Anniversary of Date of Grant
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Number/Percentage of Restricted Shares Vested
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[Insert Vesting Schedule]
The Committee may, in its sole discretion, accelerate the Vesting Date(s) for any or all of
the Restricted Shares, if in its judgment the performance of Participant has warranted such
acceleration and/or such acceleration is in the best interests of the Company.
4.
Possible Forfeiture Prior to Vesting
. Unless otherwise provided below, if
Participant ceases to be on the board of trustees of the Company prior to the Vesting Date for one
or more of the Restricted Shares, Participant will thereupon immediately forfeit any and all
unvested Restricted Shares, and the full ownership of such Restricted Shares and rights will revert
to the Company. Upon such forfeiture, Participant shall have no further rights under this
Agreement. If Participant ceases to be on the board of trustees of the Company prior to the
Vesting Date and due to Participant’s death or Disability, all restrictions on the Restricted
Shares will lapse and cease to be effective, as of the date Participant ceases to be on the board
of trustees.
5.
Delivery of Shares
. The Restricted Shares shall be held in book entry form by the
Company until the Vesting Dates. Upon the lapse of the restrictions, the Company shall cause a
share certificate to be delivered to Participant with respect to such Shares, free of all
restrictions hereunder.
6.
Dividends and Voting
. Participant is entitled to (i) receive all dividends,
payable in stock, in cash or in kind, or other distributions, declared on or with respect to any
Restricted Shares as of a record date that occurs on or after the Date of Grant hereunder and
before any transfer or forfeiture of the Restricted Shares by Participant and payable at the same
time such dividends and distributions are made to the Company’s shareholders and (ii) exercise all
voting rights with respect to the Restricted Shares, if the record date for the exercise of such
voting rights occurs on or after the Date of Grant hereunder and prior to any transfer or
forfeiture of such Restricted Shares.
7.
Titles
. Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
2
8.
Notice of I.R.C. Section 83(b) Election
. If Participant makes an election under
Section 83(b) of the Code, Participant shall promptly notify the Company of such election and
Participant shall be responsible for all reporting obligations to the Internal Revenue Service.
9.
Amendment
. This Agreement may be amended only by a writing executed by the parties
hereto which specifically states that it is amending this Agreement.
10.
Governing Law
. The laws of the State of Maryland will govern the interpretation,
validity and performance of this Agreement regardless of the law that might be applied under
principles of conflicts of laws.
11.
Binding Effect
. Except as expressly stated herein to the contrary, this Agreement
will be binding upon and inure to the benefit of the respective heirs, legal representatives,
successors and assigns of the parties hereto.
This Agreement has been executed and delivered by the parties hereto.
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The Company:
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Participant:
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Entertainment Properties Trust
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By:
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Name:
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Title:
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Address of Participant:
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3
