BRE PROPERTIES, INC.
AMENDED AND RESTATED
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
October 2, 1995
1. PURPOSE OF THE PLAN. The purpose of the Non-Employee Director Stock
Option Plan (the "Plan") is to attract and retain the services of
experienced and knowledgeable non-employee directors, to encourage them to
devote their utmost effort and skill to the advancement and betterment of
the company, and to permit them to participate in the ownership of the
company through stock compensation in lieu of cash compensation. This
plan, upon approval by the shareholders of the company as provided in
Section 10, supersedes the Company's 1994 Non-Employee Director Stock Plan.
2. DEFINITIONS. As used in the Plan and the related Option agreements, the
following terms will have the meanings stated below:
(a) "Board" means the Board of Directors of the company.
(b) "company" means BRE Properties, Inc., a Delaware corporation.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means the Board or its Compensation Committee
appointed by the Board to administer the Plan.
(e) "Exchange Act" means the Securities Exchange Act of 1934.
(f) The "Fair Market Value" of a Share on any date means the
closing price per Share on the New York Stock Exchange for that day (or,
if no Shares were publicly traded on that Exchange on that date, the next
preceding day that Shares were so traded on that Exchange).
(g) "Non-Employee Director" means a present or future member of
the Board who is not otherwise an employee of the Company.
(h) "Option" means an option to purchase Shares.
(i) "Optionee" means the holder of an Option.
(j) "Option Price" means the price to be paid for Shares upon
exercise of an Option.
(k) "Shares" means shares of Class A common stock, $.01 par
value, of the company.
(l) "Subsidiary" means any corporation in which the company
owns, directly or indirectly, stock possessing more than 50 percent of the
total combined voting power of all classes of stock.
3. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Committee. Subject to the provisions of the Plan, the Committee shall have
the power to interpret the Plan and prescribe, amend and rescind rules and
regulations relating to it.
4. PARTICIPATION IN THE PLAN.
(a) ANNUAL STOCK OPTIONS FOR 12,500 SHARES IN LIEU OF DIRECTOR FEES.
Non-Employee Directors shall receive the following Options in lieu of fees
for serving on the Board or attending meetings of the Board or its
committees.
(i) INITIAL GRANTS. Effective October 16, 1995, an initial grant of
Options for 12,500 Shares shall be made to (i) each person who on that
date is a Non-Employee Director and (ii) Gregory M. Simon, Roger P.
Kuppinger and William E. Borsari, who are proposed to become Non-Employee
Directors upon consummation of the proposed merger of the company with the
Real Estate Investment Trust of California.
(ii) GRANTS TO FUTURE NON-EMPLOYEE DIRECTORS. Any person who
hereafter becomes a Non-Employee Director shall automatically receive an
Option for 12,500 shares effective as of the date of their appointment or
election to the Board.
(iii) SUBSEQUENT ANNUAL GRANTS. In addition to the option grants
provided for in subparagraphs (i) and (ii) above, each Non-Employee
Director shall automatically receive an additional Option for 12,500
shares on each anniversary date of the date of grant of the Option
received pursuant to subparagraphs (i) or (ii) above.
(b) CHAIRMAN OF THE BOARD RETAINER. Options granted hereunder to the
Chairman of the Board shall be in addition to, and not in lieu of, any
separate cash retainer otherwise payable to the Chairman for serving in
his capacity as such.
(c) ANNUAL INCENTIVE GRANTS. In addition to the Options granted pursuant
to paragraph (a) above, each Non-Employee Director shall receive an
additional Option
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for 2,500 shares following any fiscal year of the company beginning on or
after January 1, 1996 that the growth in the company's funds from
operations per share from the prior year, as determined by reference to
the company's annual financial statements, is at or above the 80th
percentile of the ten largest publicly-traded multi-family Real Estate
Investment Trusts based on total assets. The grant date for Options
granted pursuant to this paragraph (c) shall be the date, following
publication of the company's annual financial statement, that the
reference information for the comparison REITs first becomes available.
5. SHARES SUBJECT TO PLAN. The maximum number of Shares which may be issued
pursuant to Options under the Plan shall be 400,000, subject to adjustment
in accordance with Section 8. In the event that any outstanding Option
shall expire or terminate for any reason, the Shares allocable to the
unused portion of that Option may again be available for additional
Options under the Plan.
6. TRANSFERABILITY. Except as permitted by the Committee in accordance with
the rules and regulations promulgated under the Exchange Act with respect
to any exemption from the short-swing profit provisions of Section 16(b)
of that Act, Options granted under the Plan shall not be transferable by
the holder other than by will or the laws of descent and distribution and
shall be exercisable during the holder's lifetime only by the holder or
the holder's guardian or legal representative.
7. TERMS AND CONDITIONS OF OPTIONS. The Options granted hereunder will not
be "incentive stock options" under Section 422 of the Code. Each Option
Agreement shall state the number of Shares subject to the Option, the
Option Price, the Option period, the method of exercise, the manner of
payment, any restrictions on transfer, and such other terms and conditions
as the Committee shall determine consistent with the Plan and the
following:
(a) OPTION PRICE. The price to be paid for Shares upon the exercise
of an Option shall be 100% of the Fair Market Value of the Shares on the
date the Option is granted.
(b) EXPIRATION OF OPTION. No Option shall be exercisable after the
expiration of ten years from the date of grant.
(c) PAYMENT OF OPTION PRICE. Upon exercise of an Option, the Option
Price for the Shares to which the exercise relates shall be paid in full
in cash.
(d) VESTING OF OPTIONS. Each Option granted hereunder shall become
exercisable in full on the first anniversary of the grant date, provided
the Optionee is a Non-Employee Director on that date.
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(e) TERMINATION OF DIRECTOR STATUS. Termination of an Optionee's
status as a director of the company shall not affect the ability of the
Optionee or the Optionee's estate to exercise until the expiration date
thereof any Options which have vested prior to the termination date.
(f) RIGHTS AS SHAREHOLDER. No Optionee shall have rights as a
shareholder with respect to Shares acquired under the Plan unless and
until the certificates for such Shares are delivered to him or her.
8. CAPITAL ADJUSTMENTS. The aggregate number of Shares with respect to which
Options may be granted hereunder, the number of Shares thereof covered by
each outstanding Option and the purchase price per Share shall be
proportionately adjusted for changes in the capitalization of the company
resulting from a recapitalization, reorganization, merger, consolidation,
exchange of shares, stock dividend, stock split, reverse stock split, or
other subdivision or consolidation of shares or the like. No fractional
shares shall be issued, and any fractional shares resulting from the
adjustments contemplated by this subparagraph shall be eliminated from the
respective Option.
9. EXCHANGE ACT SECTION 16. Transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3 or its successor under
the Exchange Act. To the extent any provision of the Plan or action by the
Plan administrators fails to so comply, it shall be deemed null and void,
to the extent permitted by law and deemed advisable by the Committee.
10. DURATION OF THE PLAN. This Amended and Restated Plan shall be deemed
effective on October 2, 1995, if no later than October 1, 1996 the Plan
has been approved by the affirmative vote of a majority of the outstanding
shares of voting stock of the company present and voting in person or by
proxy at a duly held shareholder meeting. The Plan shall terminate on
October 1, 2005, but may be sooner terminated by the Board at any time.
Expiration or termination of the Plan will not affect any Options then
outstanding.
11. AMENDMENT OF THE PLAN. The Board may amend or terminate the Plan at any
time; PROVIDED, HOWEVER, that the Plan may not be amended more than once
every six months, except to the extent permitted by Rule 16b-3 or to
comply with changes in the Code, or the rules and regulations thereunder,
and provided further that no such amendment shall, without the approval of
the holders of a majority of the outstanding shares of voting stock of the
company present and voting at a duly held shareholder meeting, (i)
increase the maximum number of Shares which may be purchased pursuant to
the Plan, (ii) change the purchase price, (iii) change the Option period
or increase the time limitation on the grant of Options under the Plan, or
(iv) materially modify the Plan in any manner which requires shareholder
approval under Rule 16b-3 or its successor under the Exchange Act.
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