Exhibit 10.20
RESTRICTED SHARE AGREEMENT
THIS RESTRICTED SHARE AGREEMENT (this "Agreement") is made effective as of
__________________, 2005 (the "Effective Date"), between Tanger Factory Outlet
Centers, Inc., a corporation organized under the laws of the State of North
Carolina (the "Company") and [Name of Director] (the "Restricted Shareholder").
WHEREAS, the Company has established the Amended and Restated Incentive
Award Plan of Tanger Factory Outlet Centers, Inc. and Tanger Properties Limited
Partnership (the "Plan");
WHEREAS, the Company wishes to carry out the Plan (the terms of which are
hereby incorporated by reference and made a part of this Agreement);
WHEREAS, the Plan provides for the issuance of the Company's common shares,
no par value (the "Common Shares"), subject to certain restrictions thereon
("Restricted Shares");
WHEREAS, the Board, appointed to administer the Plan with respect to Awards
to Independent Directors, has determined that it would be to the advantage and
in the best interest of the Company and its shareholders to issue the Restricted
Shares provided for herein to the Restricted Shareholder as an inducement to
enter into or remain in the service of the Company as an Independent Director
and as an incentive for increased efforts during such service, and has advised
the Company thereof and instructed the undersigned officer to issue said
Restricted Shares; and
WHEREAS, all capitalized terms used herein without definition shall have
the meanings ascribed to such terms in the Plan.
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and for other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I.
AWARD OF RESTRICTED Shares
Section 1.1 - Award of Restricted Shares
For good and valuable consideration, on the Effective Date the Company
hereby issues to the Restricted Shareholder 2000 Common Shares upon the terms
and conditions set forth in this Agreement at a purchase price of $0.00 per
share. Notwithstanding anything to the contrary anywhere else in this Agreement,
the Restricted Shares are subject to the terms, definitions and provisions of
the Plan, which is incorporated herein by reference.
Section 1.2 - Consideration to Company
In consideration for the issuance of Restricted Shares by the Company, the
Restricted Shareholder agrees to render faithful and efficient services as a
Director.
ARTICLE II.
RESTRICTIONS
Section 2.1 - Forfeiture of Restricted Shares
Immediately upon the Restricted Shareholder's Termination of Directorship
by reason of his voluntary resignation or removal for cause, the Restricted
Shareholder shall forfeit any and all Restricted Shares then subject to
Restrictions and the Restricted Shareholder's rights in any Restricted Shares
then subject to Restrictions shall expire. For purposes of this Agreement, the
term "Restrictions" shall mean the exposure to forfeiture set forth in this
Section 2.1 and the restrictions on sale or other transfer set forth in Sections
2.4 and 2.5.
Section 2.2 - Legend
Certificates representing Restricted Shares issued pursuant to this
Agreement shall, until all Restrictions lapse and new certificates are issued
pursuant to Section 2.3(b) hereof, bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO FORFEITURE,
REACQUISITION AND CERTAIN RESTRICTIONS ON TRANSFERABILITY UNDER THE TERMS
OF THAT CERTAIN RESTRICTED SHARE AGREEMENT BY AND BETWEEN TANGER FACTORY
OUTLET CENTERS, INC. AND THE REGISTERED OWNER OF SUCH SECURITIES, AND SUCH
SECURITIES MAY NOT BE, DIRECTLY OR INDIRECTLY, OFFERED, TRANSFERRED, SOLD,
ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNDER ANY
CIRCUMSTANCES, EXCEPT PURSUANT TO THE PROVISIONS OF SUCH AGREEMENT."
Section 2.3 - Lapse of Restrictions
(a) Subject to Sections 2.1 and 3.4 hereof, the Restrictions shall lapse in
accordance with the following schedule:
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Date Number of Restricted Shares
No Longer Subject to
Restrictions
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December 31, 2005 666
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December 31, 2006 666
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December 31, 2007 667
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provided, however, that the Restrictions shall lapse in full upon the Restricted
Shareholder's Termination of Directorship other than by reason of his voluntary
resignation or removal for cause.
(b) Upon the lapse of the Restrictions, the Company shall cause new
certificates to be issued with respect to such shares and delivered to the
Restricted Shareholder or his or her legal representative, free from the legend
provided for in Section 2.2 hereof and any of the other Restrictions.
Notwithstanding the foregoing, no such new certificate shall be delivered to the
Restricted Shareholder or his or her legal representative unless and until the
Restricted Shareholder or his or her legal representative shall have paid to the
Company, in cash, the full amount of all federal and state withholding or other
employment taxes applicable to the taxable income of the Restricted Shareholder
resulting from the grant of Restricted Shares or the lapse of the Restrictions.
Section 2.4 - Restricted Shares Not Transferable
Until the Restrictions hereunder lapse or expire pursuant to this
Agreement, neither the Restricted Shares (including any shares received by
holders thereof with respect to Restricted Shares as a result of share
dividends, share splits or any other form of recapitalization) nor any interest
or right therein or part thereof shall be liable for the debts, contracts, or
engagements of the Restricted Shareholder or his or her successors in interest
or shall be subject to disposition by transfer, alienation, anticipation,
pledge, encumbrance, assignment or any other means whether such disposition be
voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy)
and any attempted disposition thereof shall be null and void and of no effect;
provided, however, that, subject to the Ownership Limit (as defined in the
Articles of Incorporation of the Company), this Section 2.4 shall not prevent
transfers by will or by the applicable laws of descent and distribution.
Section 2.5 - Restrictions on New Shares
In the event that the outstanding Common Shares are changed into or
exchanged for a different number or kind of capital shares or other securities
of the Company or of another corporation by reason of merger, consolidation,
recapitalization, reclassification, share split, share dividend or combination
of shares, such new or additional or different shares or securities which are
issued upon conversion of or in exchange or substitution for Restricted Shares
which are then subject to Restrictions shall be considered to be Restricted
Shares and shall be subject to all of the Restrictions, unless the Board
provides for the expiration of the Restrictions on the Restricted Shares
underlying the distribution of the new or additional or different shares or
securities.
Section 2.6 - Section 83(b)
The Restricted Shareholder covenants that he or she will not make an
election under Section 83(b) of the Code with respect to the receipt of any
Restricted Shares without the consent of the Company, which the Company may
grant or withhold in its sole discretion.
ARTICLE III.
MISCELLANEOUS
Section 3.1 - Holding Period and Additional Restrictions as to Ownership and
Transfer
(a) Notwithstanding any provision of this Agreement to the contrary, if the
Restricted Shareholder is subject to Section 16 of the Exchange Act on the date
on which the Restricted Shares are granted, the Restricted Shares may not be
sold, assigned or otherwise transferred or exchanged until at least six months
and one day have elapsed from the date on which the Restricted Shares were
granted.
(b) The Restricted Shares (whether or not the Restrictions have lapsed with
respect to such Restricted Shares) shall be subject to the restrictions on
ownership and transfer set forth in the Articles of Incorporation of the
Company.
Section 3.2 - Conditions to Issuance of Share Certificates
Restricted Shares may be either previously authorized but unissued shares
or issued shares which have then been reacquired by the Company. Such shares
shall be fully paid and nonassessable. The Company shall not be required to
issue or deliver any certificate or certificates for shares pursuant to this
Agreement prior to fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock exchanges on which
such class of shares is then listed;
(b) The completion of any registration or other qualification of such
shares under any state or federal law or under rulings or regulations of the
Securities and Exchange Commission or of any other governmental regulatory body,
which the Board shall, in its sole discretion, deem necessary or advisable;
(c) The obtaining of any approval or other clearance from any state or
federal governmental agency which the Board shall, in its sole discretion,
determine to be necessary or advisable;
(d) The lapse of such reasonable period of time as the Board may from time
to time establish for reasons of administrative convenience; and
(e) The receipt by the Company of full payment for such shares, including
payment of any applicable withholding tax to the Company.
Section 3.3 - Escrow
(a) The Restricted Shareholder hereby authorizes and directs the Secretary
of the Company, or such other person designated by the Company, to transfer the
Restricted Shares which are subject to the Restrictions from the Restricted
Shareholder to the Company in the event of forfeiture of such shares pursuant to
Section 2.1.
(b) To insure the availability for delivery of the Restricted Shares upon
forfeiture pursuant to Section 2.1, the Restricted Shareholder hereby appoints
the Secretary, or any other person designated by the Company as escrow agent, as
its attorney-in-fact to sell, assign and transfer unto the Company, such shares,
if any, forfeited pursuant to this Agreement and shall, upon execution of this
Agreement, deliver and deposit with the Secretary of the Company, or such other
person designated by the Company, the share certificates representing the
Restricted Shares, together with the share assignment duly endorsed in blank,
attached hereto as Exhibit A. The Restricted Shares and share assignment shall
be held by the Secretary in escrow, pursuant to the Joint Escrow Instructions of
the Company and the Restricted Shareholder attached hereto as Exhibit B, until
all of the Restrictions expire or shall have been removed. Upon the lapse of the
Restrictions on the Restricted Shares, the escrow agent shall promptly deliver
to the Restricted Shareholder the certificate or certificates representing such
shares in the escrow agent's possession belonging to the Restricted Shareholder,
and the escrow agent shall be discharged of all further obligations hereunder;
provided, however, that the escrow agent shall nevertheless retain such
certificate or certificates as escrow agent if so required pursuant to other
restrictions imposed pursuant to this Agreement.
(c) The Company, or its designee, shall not be liable for any act it may do
or omit to do with respect to holding the Restricted Shares in escrow and while
acting in good faith and in the exercise of its judgment.
Section 3.4 - Ownership Limit and REIT Status.
Notwithstanding anything contained herein, the Restrictions on the
Restricted Shares shall not lapse:
(a) to the extent the lapsing of such Restrictions could cause the
Restricted Shareholder to be in violation of the Ownership Limit; or
(b) if, in the discretion of the Administrator, the lapsing of such
Restrictions could impair the Company's status as a REIT.
Section 3.5 - Notices
Any notice to be given by the Restricted Shareholder under the terms of
this Agreement shall be addressed to the Secretary of the Company. Any notice to
be given to the Restricted Shareholder shall be addressed to him or her at the
address given beneath his or her signature hereto. By a notice given pursuant to
this Section 3.5, either party may hereafter designate a different address for
notices to be given to him. Any notice which is required to be given to the
Restricted Shareholder shall, if Restricted Shareholder is then deceased, be
given to the Restricted Shareholder's personal representative if such
representative has previously informed the Company of his or her status and
address by written notice under this Section 3.5. Any notice required or
permitted hereunder shall be given in writing and shall be deemed effectively
given upon personal delivery or upon deposit in the United States mail by
certified mail, with postage and fees prepaid, addressed as set forth above.
Section 3.6 - Rights as Shareholder
Except as otherwise provided herein, upon the delivery of Restricted Shares
to the escrow holder pursuant to Section 3.3 hereof, the holder of the
Restricted Shares shall have all the rights of a shareholder with respect to the
Restricted Shares, including the right to vote the Restricted Shares and the
right to receive all dividends or other distributions paid or made with respect
to the Restricted Share.
Section 3.7 - Conformity to Securities Laws
The Restricted Shareholder acknowledges that the Plan and this Agreement
are intended to conform to the extent necessary with all provisions of all
applicable federal and state laws, rules and regulations (including, but not
limited to the Securities Act and the Exchange Act and any and all regulations
and rules promulgated by the Securities and Exchange Commission thereunder,
including without limitation the applicable exemptive conditions of Rule 16b-3)
and to such approvals by any listing, regulatory or other governmental authority
as may, in the opinion of counsel for the Company, be necessary or advisable in
connection therewith. Notwithstanding anything herein to the contrary, the Plan
shall be administered, and the Restricted Shares are granted, only in such a
manner as to conform to such laws, rules and regulations. To the extent
permitted by applicable law, the Plan, this Agreement and the Restricted Shares
shall be deemed amended to the extent necessary to conform to such laws, rules
and regulations.
Section 3.8 - Amendments
This Agreement and the Plan may be amended without the consent of the
Restricted Shareholder; provided, however, that no such amendment shall, without
the consent of the Restricted Shareholder, impair any rights of the Restricted
Shareholder under this Agreement.
Section 3.9 - Tax Withholding
The Company shall be entitled to require payment in cash or deduction from
other compensation payable to the Restricted Shareholder of any sums required by
federal, state or local tax law to be withheld with respect to the issuance,
vesting, exercise or payment of the Restricted Shares. The Board may in its
discretion and in satisfaction of the foregoing requirement allow the Restricted
Shareholder to elect to have the Company withhold Common Shares otherwise
issuable under such award (or allow the return of Common Shares) having a Fair
Market Value equal to the sums required to be withheld. Notwithstanding any
other provision of the Plan or this Agreement, the number of Common Shares which
may be withheld with respect to the issuance, vesting or payment of the
Restricted Shares (or which may be repurchased from the Restricted Shareholder
within six months after such Common Shares were acquired by the Restricted
Shareholder from the Company) in order to satisfy the Restricted Shareholder's
federal and state income and payroll tax liabilities with respect to the
issuance, vesting or payment of the Restricted Shares shall be limited to the
number of shares which have a Fair Market Value on the date of withholding or
repurchase equal to the aggregate amount of such liabilities based on the
minimum statutory withholding rates for federal and state tax income and payroll
tax purposes that are applicable to such supplemental taxable income.
Section 3.10 - Governing Law
This Agreement shall be administered, interpreted and enforced under the
internal laws of the state of North Carolina without regard to conflicts of laws
thereof.
Section 3.11 - Stop Transfer Instructions
To ensure compliance with the Restrictions, the Company may
issue appropriate "stop transfer" instructions to its transfer agent with
respect to the Restricted Shares.
Section 3.12 - Shareholder Approval
Notwithstanding anything to the contrary herein, all
Restricted Shares awarded hereunder shall be forfeited on May 14, 2004 in the
event the shareholders of the Company do not approve the Amended and Restated
Incentive Award Plan of Tanger Factory Outlet Centers, Inc. and Tanger
Properties Limited Partnership at the Company's annual meeting of shareholders
on such date.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the date set forth below.
TANGER FACTORY OUTLET CENTERS, INC.,
a North Carolina corporation
By:
---------------------------------------------------------
Its:
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DATE: _________________________________________
RESTRICTED SHAREHOLDER
Address:
Taxpayer Identification Number: _______________
Date: ______________________________
EXHIBIT A TO RESTRICTED SHARES AGREEMENT
SHARE ASSIGNMENT SEPARATE FROM CERTIFICATE(S)
FOR VALUE RECEIVED, __________________________ hereby sells, assigns and
transfers unto Tanger Factory Outlet Centers, Inc., a corporation organized
under the laws of North Carolina (the "Company"), pursuant to the forfeiture
provision under that certain Restricted Shares Agreement, dated
_________________, 2005 by and between the undersigned and the Company (the
"Agreement"), ______ Common Shares of the Company standing in the undersigned's
name on the books of the Company represented by Certificate No(s).
_______________ and does hereby irrevocably constitute and appoint the Company's
Secretary to transfer said Common Shares on the books of the Company with full
power of substitution in the premises.
This Share Assignment Separate from Certificate(s) may be used only in
accordance with and subject to the terms and conditions of the Agreement, in
connection with the forfeiture of Common Shares issued to the undersigned
pursuant to the Agreement, and only to the extent that such shares remain
subject to such forfeiture under the Agreement.
Dated: __________________ ______________________________________
(Signature)
------------------------------------
(Print Name)
(INSTRUCTION: Please do not fill in any blanks other than the "Signature" line
and the "Print Name" line.)
EXHIBIT B TO RESTRICTED SHARES AGREEMENT
JOINT ESCROW INSTRUCTIONS
Tanger Factory Outlet Centers
3200 Northline Avenue, Suite 360
Greensboro, North Carolina 27408
Attn: Secretary
Dear Secretary of Tanger Factory Outlet Centers, Inc.:
As Escrow Agent for Tanger Factory Outlet Centers, Inc., (the "Company")
and the undersigned holder of Common Shares of the Company (the "Restricted
Shareholder"), you are hereby authorized and directed to hold the documents
delivered to you pursuant to the terms of that certain Restricted Shares
Agreement ("Agreement"), dated _______________, 2005, to which a copy of these
Joint Escrow Instructions is attached as Exhibit B, in accordance with the
following instructions:
1. In the event of the forfeiture of any shares pursuant to Section 2.1 of
the Agreement, the Company or its assignee will give to the Restricted
Shareholder and you a written notice specifying the number of Common Shares to
be purchased, the purchase price, and the time for a closing hereunder at the
principal office of the Company. The Restricted Shareholder and the Company
hereby irrevocably authorize and direct you to close the transaction
contemplated by such notice in accordance with the terms of said notice.
2. At the closing you are directed (a) to date any share assignments
necessary for the transfer in question, (b) to fill in the number of shares
being transferred, and (c) to deliver same, together with the certificate
evidencing the Common Shares to be transferred, to the Company against the
simultaneous delivery to you of the purchase price (which may include suitable
acknowledgment of cancellation of indebtedness) for the number of Common Shares
being forfeited.
3. The Restricted Shareholder irrevocably authorizes the Company to deposit
with you any certificates evidencing Common Shares to be held by you hereunder
and any additions and substitutions to said shares as specified in the
Agreement. The Restricted Shareholder does hereby irrevocably constitute and
appoint you as the Restricted Shareholder's attorney-in-fact and agent for the
term of this escrow to execute with respect to such securities and other
property all documents of assignment and/or transfer and all share certificates
necessary or appropriate to make all securities negotiable and complete any
transaction herein contemplated.
4. This escrow shall terminate upon expiration or exercise in full of the
Restrictions described in the Agreement, whichever occurs first.
5. If at the time of termination of this escrow you should have in your
possession any documents, securities, or other property belonging to the
Restricted Shareholder, you shall deliver all of same to the Restricted
Shareholder and shall be discharged of all further obligations hereunder;
provided, however, that if at the time of termination of this escrow you are
advised by the Company that the property subject to this escrow is the subject
of a pledge or other security agreement, you shall deliver all such property to
the pledgeholder or other person designated by the Company.
6. Except as otherwise provided in these Joint Escrow Instructions, your
duties hereunder may be altered, amended, modified or revoked only by a writing
signed by all of the parties hereto.
7. You shall be obligated only for the performance of such duties as are
specifically set forth herein and may rely and shall be protected in relying or
refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties or
their assignees. You shall not be personally liable for any act you may do or
omit to do hereunder as Escrow Agent or as attorney-in-fact for the Restricted
Shareholder while acting in good faith and any act done or omitted by you
pursuant to the advice of your own attorneys shall be conclusive evidence of
such good faith.
8. You are hereby expressly authorized to disregard any and all warnings
given by any of the parties hereto or by any other person or corporation,
excepting only orders or process of courts of law, and are hereby expressly
authorized to comply with and obey orders, judgments or decrees of any court. In
case you obey or comply with any such order, judgment or decree of any court,
you shall not be liable to any of the parties hereto or to any other person,
firm or corporation by reason of such compliance, notwithstanding any such
order, judgment or decree being subsequently reversed, modified, annulled, set
aside, vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the identity,
authority or rights of the parties executing or delivering or purporting to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.
10. You shall not be liable for the outlawing of any rights under any
statute of limitations with respect to these Joint Escrow Instructions or any
documents deposited with you.
11. Your responsibilities as Escrow Agent hereunder shall terminate if you
shall cease to be Secretary of the Company or if you shall resign by written
notice to each party. In the event of any such termination, the Company may
appoint any officer or assistant officer of the Company as successor Escrow
Agent and the Restricted Shareholder hereby confirms the appointment of such
successor or successors as the Restricted Shareholder's attorney-in-fact and
agent to the full extent of your appointment.
12. If you reasonably require other or further instruments in connection
with these Joint Escrow Instructions or obligations in respect hereto, the
necessary parties hereto shall join in furnishing such instruments.
13. It is understood and agreed that should any dispute arise with respect
to the delivery and/or ownership or right of possession of the securities, you
are authorized and directed to retain in your possession without liability to
anyone all or any part of said securities until such dispute shall have been
settled either by mutual written agreement of the parties concerned or by a
final order, decree or judgment of a court of competent jurisdiction after the
time for appeal has expired and no appeal has been perfected, but you shall be
under no duty whatsoever to institute or defend any such proceedings.
14. Any notice required or permitted hereunder shall be given in writing
and shall be deemed effectively given upon personal delivery or sent by telegram
or fax or upon deposit in the United States Post Office, by registered or
certified mail with postage and fees prepaid, addressed to the other party at
the addresses set forth on the signature pages hereto or at such other address
as such party may designate by ten (10) days' advance written notice to the
other party hereto.
15. By signing these Joint Escrow Instructions you become a party hereto
only for the purpose of said Joint Escrow Instructions; you do not become a
party to the Agreement.
16. You shall be entitled to employ such legal counsel and other experts
(including without limitation the firm of Latham & Watkins) as you may deem
necessary properly to advise you in connection with your obligations hereunder.
You may rely upon the advice of such counsel, and may pay such counsel
reasonable compensation therefor. The Company shall be responsible for all fees
generated by such legal counsel in connection with your obligations hereunder.
17. These Joint Escrow Instructions shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns. It is understood and agreed that references to "you" or "your" herein
refer to the original Escrow Agent and to any and all successor Escrow Agents.
It is understood and agreed that the Company may at any time or from time to
time assign its rights under the Agreement and these Joint Escrow Instructions
in whole or in part.
18. These Joint Escrow Instructions shall be governed by and interpreted
and determined in accordance with the laws of the State of North Carolina, as
such laws are applied by North Carolina courts to contracts made and to be
performed entirely in North Carolina by residents of that state.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, these Joint Escrow Instructions have been
executed and delivered by the parties hereto.
TANGER FACTORY OUTLET CENTERS, INC.,
a North Carolina corporation
By:
--------------------------------------------
Its:
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Address:
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RESTRICTED SHAREHOLDER
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Address:
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ACKNOWLEDGED AND AGREED:
ESCROW AGENT
By:
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Secretary
Address:
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