1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
EXCEL REALTY TRUST, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------------------
(3) Filing Party:
----------------------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------------------
2
April 1, 1996
Dear Stockholders:
It is my pleasure to invite you to the Annual Stockholders Meeting of
Excel Realty Trust, Inc. This year the meeting will be held on Friday, May 10
at 10:00 A.M. at the Rancho Bernardo Inn, 17550 Bernardo Oaks Drive, San Diego,
California. Your Board of Directors and Management look forward to greeting
those stockholders able to attend.
We consider the Annual Meeting an excellent opportunity to review the
events of the past year and to discuss the Company's objectives with you in
person.
Thank you for your interest and participation. I look forward to
seeing you there.
Sincerely,
/s/ GARY B. SABIN
Gary B. Sabin
Chairman and Chief Executive Officer
3
EXCEL REALTY TRUST, INC.
16955 Via Del Campo, Suite 110
San Diego, California 92127
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS AND PROXY STATEMENT
TO THE STOCKHOLDERS OF EXCEL REALTY TRUST, INC.:
Notice is hereby given that the Annual Meeting of the Stockholders of
EXCEL REALTY TRUST, INC. (the "Company"), will be held at the Rancho Bernardo
Inn, 17550 Bernardo Oaks Drive, San Diego, California, on May 10, 1996, at
10:00 a.m. (PDT), for the following purposes:
1. TO ELECT, PURSUANT TO THE COMPANY CHARTER, THREE DIRECTORS FOR
A THREE YEAR TERM AND UNTIL THEIR SUCCESSORS ARE ELECTED AND
HAVE QUALIFIED. THE PRESENT BOARD OF DIRECTORS OF THE COMPANY
HAS NOMINATED AND RECOMMENDS FOR SUCH ELECTION AS DIRECTORS
THE FOLLOWING THREE PERSONS:
GARY B. SABIN
ROBERT E. PARSONS, JR.
BOYD A. LINDQUIST
2. TO CONSIDER AND VOTE UPON A PROPOSAL TO AMEND THE DIRECTORS'
1994 STOCK OPTION PLAN FOR DIRECTORS OF THE COMPANY (THE
"DIRECTOR PLAN").
3. TO CONSIDER AND VOTE UPON A PROPOSAL TO AMEND THE 1993 STOCK
OPTION PLAN FOR EXECUTIVES AND KEY EMPLOYEES OF THE COMPANY
(THE "EMPLOYEE PLAN").
4. TO TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE
THE ANNUAL MEETING OR ANY ADJOURNMENT THEREOF.
The Board of Directors has fixed the close of business on April 1,
1996, as the record date with respect to this solicitation.
Accompanying this Notice is a Proxy. WHETHER OR NOT YOU EXPECT TO BE
AT THE MEETING, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY.
If you plan to attend the meeting and wish to vote your shares personally, you
may do so at any time before the Proxy is voted.
All stockholders are cordially invited to attend the meeting.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ RICHARD B. MUIR
Richard B. Muir
Executive Vice President and Secretary
San Diego, California
April 1, 1996
4
EXCEL REALTY TRUST, INC.
16955 VIA DEL CAMPO, SUITE 110
SAN DIEGO, CALIFORNIA 92127
PROXY STATEMENT
for
ANNUAL MEETING OF STOCKHOLDERS
May 10, 1996
The accompanying Proxy is solicited by the Board of Directors of Excel
Realty Trust, Inc., a Maryland corporation (the "Company"), in connection with
the Annual Meeting of Stockholders to be held at 10:00 a.m. (PDT) on May 10,
1996, at the Rancho Bernardo Inn, 17550 Bernardo Oaks Drive, San Diego,
California, and at any and all adjournments thereof. By signing and returning
the enclosed Proxy, you authorize the representatives of the Company named on
it to represent you and vote your shares.
If you attend the meeting, you may vote by ballot. But, if you are
not present, your shares can be voted only when represented by proxy. You may
indicate a vote for or against each proposal on the Proxy and your shares will
be voted accordingly. A stockholder may revoke his or her Proxy at will at any
time prior to the voting of his or her shares by voting in person at the Annual
Meeting, by filing with the Secretary of the Company a duly executed Proxy
bearing a later date as his or her instrument revoking this Proxy, or by
delivering to the Secretary a written notice prior to the Annual Meeting
stating that he or she revokes his or her Proxy. Unless the accompanying Proxy
has been previously revoked, the shares represented by the Proxy will, unless
otherwise directed, be voted at the Annual Meeting for the nominees named below
for election as Directors, and for all other matters described in this Proxy
Statement. Votes cast by Proxy or in person at the Annual Meeting will be
counted by the person appointed by the Company to act as Inspector of Election
for the Annual Meeting. The Inspector of Election will treat shares
represented by Proxies that reflect abstentions or include "broker non-votes"
as shares that are present and entitled to vote for purposes of determining the
presence of a quorum. Abstentions or "broker non-votes" do not constitute a
vote "for or "against" any matter and thus will be disregarded in the
calculation of "votes cast;" provided, however, that as respects Proposal 2 and
Proposal 3, abstentions will have the same effect as votes "against." Any
unmarked Proxies, including those submitted by brokers or nominees, will be
voted in favor of the proposals and nominees of the Board of Directors, as
indicated in the accompanying Proxy card.
The costs of solicitation of Proxies will be paid by the Company. In
addition to soliciting Proxies by mail, the Company's officers, directors and
other regular employees, without additional compensation, may solicit Proxies
personally or by other appropriate means. It is anticipated that banks,
brokers, fiduciaries, other custodians and nominees will forward proxy
soliciting materials to their principals, and that the Company will reimburse
such persons' out-of-pocket expenses.
It is anticipated that this Proxy Statement will first be mailed to
stockholders on or about April 1, 1996. The Company's 1995 Annual Report to
its stockholders is also enclosed and should be read in conjunction with the
matters set forth herein.
Only stockholders of record of the Company's Common Stock as of the
close of business on April 1, 1996, will be entitled to vote at the Annual
Meeting. At the close of business on April 1, 1996, there were outstanding
13,231,402 shares of the Company's Common Stock, which constitute all of the
outstanding voting securities of the Company, each of which is entitled to one
vote on each of the matters to be presented to the stockholders at the meeting.
5
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors currently consists of the following seven
Directors: Gary B. Sabin, Richard B. Muir, Boyd A. Lindquist, D. Charles
Marston, Robert E. Parsons, Jr., Bruce A. Staller, and John H. Wilmot.
Pursuant to the Company charter, the Directors are divided into three classes.
The Directorship terms of current Directors Gary B. Sabin, Robert E. Parsons,
Jr. and Boyd A. Lindquist expire at the Annual Meeting on May 10, 1996, while
the terms of the remaining Directors expire in 1997 and 1998. Messrs. Sabin,
Parsons and Lindquist have been nominated and recommended for election to serve
as Directors for a term of three years and until their respective successors
shall have been duly elected and shall qualify. Messrs. Sabin, Parsons and
Lindquist have advised the Board of Directors that they are able and willing to
serve as Directors. If, for any reason, any of them shall become unavailable
for election, the individuals named in the enclosed proxy may exercise their
discretion to vote for any substitute nominee or nominees proposed by the Board
of Directors.
The three individuals with the highest number of affirmative votes
will be elected to the three Directorships.
INFORMATION REGARDING NOMINEES
The information set forth below is submitted with respect to
Management's nominees to the Board of Directors.
Name Age Present Position With The Company Director Since
---- --- --------------------------------- --------------
Gary B. Sabin 41 Chairman of the Board, President and 1989
Chief Executive Officer
Robert E. Parsons, Jr. 40 Director 1989
Boyd A. Lindquist 58 Director 1992
Gary B. Sabin has served as Chairman of the Board, President and Chief
Executive Officer of the Company since January, 1989. Mr. Sabin has also
served as President and Chief Executive Officer of Excel Interfinancial
Corporation ("EIC"), a real estate services company, and certain of its
affiliates since 1977. EIC and its affiliates provided real estate
acquisition, management and advisory services to the Company from 1989 until
the Company became self-managed under Mr. Sabin's direction in 1993.
Robert E. Parsons, Jr. has served as a Director of the Company since
January, 1989. Mr. Parsons is currently Executive Vice President and Chief
Financial Officer of Host Marriott Corporation, a company he joined in 1981.
He also serves as a Director and an officer of several Host Marriott
subsidiaries, and as a Director of Merrill Financial Corporation, a
privately-held real estate company.
Boyd A. Lindquist has served as a director of the Company since
February, 1992. Mr. Lindquist is presently President, Chief Executive Officer
and a Director of Republic Bank. Prior to joining Republic Bank in July 1991,
Mr. Lindquist served since prior to 1987 as President and Chief Executive
Officer of the Bank of San Diego, where he was responsible for the management
of the six-branch bank. Mr. Lindquist has over 30 years experience in managing
financial institutions.
CERTAIN COMMITTEES OF THE BOARD; MEETINGS
The Board of Directors held six meetings (including telephonic
meetings) during the year ended December 31, 1995. For that year, no nominee
for Director who served as a Director during the past year attended fewer than
75% of the aggregate of the total number of meetings of the Board of Directors
and of any meetings of committees upon which he served. The Board of Directors
has established the following standing committees: Audit Committee, Executive
Committee, and the Executive Compensation and Stock Option Committee. There is
no standing Nominating Committee. The Board of Directors has delegated certain
functions to the following standing committees of the Board:
2
6
Audit Committee. The Audit Committee consists of three Directors who
are not employees of the Company ("non-employee Directors"). Messrs.
Lindquist, Parsons and Marston are the current members of the Committee. The
Audit Committee was established to make recommendations concerning the
engagement of independent public accountants, review with independent public
accountants the plans and results of the audit engagement, approve professional
services provided by the independent accountants, review the independence of
the independent accountants, consider the range of audit and non-audit fees,
and to review the adequacy of the Company's internal accounting controls. The
Audit Committee met four times during 1995.
Executive Committee. The Executive Committee consists of three
Directors, one of whom must be a non-employee Director. Messrs. Gary Sabin,
Muir and Wilmot currently serve on the Executive Committee. Subject to the
Company's conflict of interest policies, the Executive Committee has been
granted the authority to acquire and dispose of real property and to borrow or
loan funds on behalf of the Company, provided, however, that any such
transaction involving amounts equal to 10% or more of the Company's gross
assets require the approval of at least a majority of the Directors, subject to
certain further restrictions set forth in the Company's Bylaws. The Executive
Committee also has the power to authorize the execution of certain contracts
and agreements, including those related to the borrowing of money by the
Company. The Executive Committee met three times during 1995, and held
numerous meetings telephonically.
Executive Compensation and Stock Option Committee. The Executive
Compensation and Stock Option Committee consists of three Directors, all of
whom must be non-employee Directors. Messrs. Lindquist, Parsons and Staller
currently serve on the Executive Compensation and Stock Option Committee. The
Executive Compensation and Stock Option Committee determines compensation for
the Company's executive officers and administers the granting of stock options.
The Executive Compensation and Stock Option Committee met three times during
1995.
DIRECTORS' COMPENSATION
Directors who are not otherwise paid employees or consultants of the
Company received an increase in annual compensation in October 1995 from
$12,000 to $14,000 per annum plus a fee of $1,000 for attendance, in person, at
each meeting of the Board of Directors, and, as of October 1995 the directors
receive $500 per committee meeting for the Audit and Compensation Committees
and $750 per committee meeting for the Executive Committee, but not for
telephonic meetings. Each such non-employee Director also is reimbursed for
expenses incurred in attending meetings (including committee meetings).
Officers of the Company who are Directors are not paid Director fees or
committee meeting fees.
Pursuant to the terms of the Director Plan, every duly elected and
qualified Director is entitled to, on an annual basis, options to purchase
2,000 shares of the Company's common stock.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors unanimously recommends a vote FOR the nominees
set forth above. Proxies solicited by the Company will be so voted unless
stockholders specify otherwise on the accompanying proxy.
PROPOSAL 2
AMENDMENT OF THE DIRECTOR PLAN
The stockholders of the Company will be asked to consider and vote
upon a proposal to amend the 1994 Directors' Stock Option Plan of Excel Realty
Trust, Inc. (the "Director Plan"), described herein. The Plan was adopted by
the Company's Board of Directors on April 19, 1994, and approved by the
stockholders on May 25, 1994.
General Nature and Purposes. The Director Plan was adopted to further
the growth, development and financial success of the Company by providing
additional incentives to its Directors and to enable the Company to obtain and
retain the services of the type of directors considered essential to the
long-range success of the Company.
3
7
The principle features of the Director Plan are summarized
below, but the summary is qualified in its entirety by reference to the full
text of the Director Plan which is set forth as Exhibit "A" to this Proxy
Statement.
Eligibility and Participation. The directors of the Company eligible
to participate in the Director Plan are each of the current and future
directors who have been duly elected and qualified to serve as such directors.
Options Authorized, Reserved and Granted. As of April 1, 1994,
240,000 shares of Common Stock were reserved for option grants to directors of
the Company under the Director Plan and 28,000 options had been granted to
Directors under the Director Plan.
Administration. The Director Plan will be administered by the
Executive Compensation and Stock Option Committee of the Board of Directors
(the "Committee"), which shall consist of two or more directors, appointed by
and holding office at the pleasure of the Company's Board of Directors, each of
whom is a "disinterested person" within the meaning of paragraph (c)(2) of Rule
16b-3 and an "outside director" within the meaning of Section 162(m)(4)(C)(ii)
of the Internal Revenue Code of 1986, as amended (the "Code"). In addition to
administering the Director Plan, the Committee is also authorized to interpret
the Director Plan and to prescribe, amend and revoke rules and regulations
relating to the Director Plan. Appointment of Committee members shall be
effective upon acceptance of appointment. Vacancies in the Committee shall be
filled by the Board of Directors. The current members of the Committee are Mr.
Lindquist, Mr. Parsons and Mr. Staller.
Grant of Options. The Director Plan currently provides that each
participating director shall be granted an option for 2,000 shares of stock
(subject to the adjustments provided in Section 7 of the Director Plan) on the
date on which such director is first elected as a director of the Company and
on each anniversary date of stockholder approval of the Director Plan on which
he or she continues to serve as a director of the Company (these annual dates
of grant are collectively referred to as the "date of grant"). In no event
shall any director receive options for more than 2,000 shares annually under
the Director Plan. The following table sets forth for each of the Company's
present (and future) participating directors: (i) the positions held by such
directors; and (ii) the number of option shares granted annually to such
directors.
1994 DIRECTORS' STOCK OPTION PLAN BENEFITS
Name Present Position With The Company Annual Option Grants
---- --------------------------------- --------------------
Gary B. Sabin Chief Executive Officer, President and 2,000
Chairman of the Board
Richard B. Muir Executive Vice President, Secretary and 2,000
Director
Boyd A. Lindquist Director 2,000
D. Charles Marston Director 2,000
Robert E. Parsons Director 2,000
Bruce A. Staller Director 2,000
John H. Wilmot Director 2,000
Future Participating Directors Director 2,000
Stock Option Agreements; Consideration to the Company. In
consideration of receiving the option, each participating director is deemed to
have agreed to remain as a director of the Company for a period of at least one
year after the date of grant; however, the Director Plan provides that nothing
therein shall confer upon any participating director any right to continue as a
director of the Company or shall interfere with or restrict in any way the
rights of the Company or the Company's stockholders to remove any participating
director at any time for any reason whatsoever, with or without cause, to the
extent permitted by the Company's bylaws and applicable law.
Terms and Exercise of Options. The term of any option cannot be
longer than ten years from the date of grant. Payment for shares purchased
must be made in full in cash upon exercise.
Options which are exercisable upon termination of a participating
director's status as a director of the Company generally expire thirty days
following such termination, unless a director ceases to be a Director due
4
8
to disability, in which case options terminate within twelve months of such
event, or in the case of death, in which case options generally terminate
within six to twelve months.
The per share exercise price for the shares issued pursuant to the
exercise of an option is the fair market value per share on the date of grant.
The Company's Common Stock is currently listed on the New York Stock Exchange
("NYSE"), and while the stock is so listed, the fair market value is the
closing price per share of the Common Stock as listed on the NYSE on the
business day immediately prior to the date of grant.
Transfer Restrictions and Non-assignability. Options may be
transferred only by will or by the laws of descent and distribution and during
a option holder's lifetime am exercisable only by the option holder.
Adjustments Upon Change in Capitalization. If the outstanding shares
of Common Stock of the Company subject to options are changed into or exchanged
for a different number or kind of shares of the Company or other securities of
the Company by reason of stock split, reverse stock split, stock dividend,
combination or reclassification of shares or otherwise, the Committee will make
an appropriate adjustment in the number and kind of shares as to which all
outstanding options or portions thereof then unexercised will be exercisable,
to the end that after such event the option holder's proportionate interests
will be maintained as before the occurrence of such event. In the event of the
proposed dissolution or liquidation of the Company, options will terminate
unless otherwise provided by the Committee. In the event of a proposed sale of
substantially all of the assets of the Company or the merger of the Company
with or into another corporation, the options will be assumed by the successor
corporation unless the Committee determines instead to make the options fully
exercisable, in which event the Committee shall notify option holders that the
options will be fully exercisable for a fifteen day period and the options will
terminate at the end of such period.
Term of Plan and Amendments. The Director Plan expires on May 15,
2004, unless sooner terminated by the Board of Directors. The Board of
Directors may at any time amend or otherwise modify, suspend or terminate the
Director Plan, provided that no such action shall deprive an option holder,
without his or her consent, of any option previously granted pursuant to the
Director Plan or of any of the option holder's rights under such option.
Federal Tax Aspects. The following discussion is a general summary of
the material federal income tax consequences to participants in the Director
Plan. The discussion is based on the Code, regulations thereunder, rulings and
decisions now in effect, all of which are subject to change. The summary does
not discuss all aspects of federal income taxation that may be relevant to a
particular participant in light of such participant's personal investment
circumstances. Also, state and local income taxes are not discussed and may
vary from locality to locality.
Holders of non-qualified stock options do not realize income as a
result of the grant of such options, but normally realize compensation income
taxable at ordinary income rates upon such options' exercise to the extent that
the fair market value of the shares of Common Stock on the date of the exercise
of such options exceeds the option exercise price paid. However, in the case
of an optionee subject to Section 16(b) of the Exchange Act who has held
non-qualified stock options for less than six months and exercises such
options, the ordinary income portion generally would be calculated using the
fair market value of the shares upon the lapse of the six-month period from the
date of grant of such options rather than the fair market value on the date of
exercise, unless the optionee elects to recognize income immediately upon
exercise in accordance with Section 83(b) of the Code. The Company will be
entitled to a tax deduction in an amount equal to the amount that the optionee
is required to include in ordinary income at the time of such inclusion, and
will be required to withhold taxes on such ordinary income in the case of a
director who is an employee. The optionee's initial tax basis for shares
acquired upon the exercise of a non- qualified stock option will be the option
exercise price paid plus the amount of ordinary income realized by the
optionee. Any appreciation in the value of such shares may qualify for capital
gains treatment depending upon the applicable holding period.
PROPOSED AMENDMENTS TO THE DIRECTOR PLAN
The Board of Directors recommends an amendment to the Director Plan to
establish a different formula for calculating the award of stock options.
Pursuant to this revised formula, each Director would immediately receive, and
thereafter as of each annual meeting of stockholders commencing in 1997 that
the Director Plan is
5
9
in effect, each Director then in office (which would include current and
continuing Directors as well as any Director who later joins the Board) would
receive an option exercisable for a number of shares determined pursuant to the
following formula:
Number of option shares = 3,000 + (250 multiplied by the number of
years of continuous service beginning in 1997 including any portion of
any fiscal year of service as a full year)
The number of shares subject to options allocated under the revised
formula escalates each year as a result of being based on years of service as a
director. Any additional or replacement Director would, pursuant to the
revised formula, receive on first occurring anniversary of the stockholder's
approval of this amendment, an option for 3,000 shares, which option would
increase annually by 250 shares during each year of service thereafter.
The 240,000 shares reserved for the Director Plan will continue to be
sufficient to cover full grants through 2002 to the existing seven Directors
even under the revised formula.
The Board of Directors believes that increasing the number of shares
available each year for issuance under the Director Plan is necessary in order
for the Executive Compensation and Stock Option Committee to have sufficient
flexibility to carry out its responsibilities to (i) further the growth,
development and financial success of the Company by providing additional
incentives to its directors and (ii) enable the Company to obtain and retain
the services of the type of directors considered essential to the long-range
success of the Company.
The Board of Directors also recommends an amendment to the Director
Plan to permit payment for the shares with respect to which an option is
exercised (i) with cash; (ii) through the surrender of shares of Common Stock
then issuable upon exercise of the option (subject to certain timing
requirements); (iii) through the delivery of an interest-bearing promissory
note; or (iv) through any combination of (i) through (iii).
The Board of Directors also recommends an amendment to the Director
Plan to change the date of grant of future options from the date of initial
stockholder approval of the Director Plan to the date that this proposed
amendment to the Director Plan is approved by the stockholders.
Amended Plan Benefits. The following table sets forth the stock
options that certain groups will receive in 1996 if the amended Director Plan
is approved by the Company's stockholders at the meeting.
Number of
Securities
Dollar Underlying
Name and Position Value Options
----------------- ----- -----------
Gary B. Sabin . . . . . . . . . . . . . . . . . . . . . . (1) 3,000
Richard B. Muir . . . . . . . . . . . . . . . . . . . . . (1) 3,000
David A. Lund . . . . . . . . . . . . . . . . . . . . . . -- --
Ronald H. Sabin . . . . . . . . . . . . . . . . . . . . . -- --
Graham B. Bullick . . . . . . . . . . . . . . . . . . . . -- --
Executive Group . . . . . . . . . . . . . . . . . . . . . (1) 6,000(2)
Non-Executive Director Group . . . . . . . . . . . . . . (1) 15,000
Non-Executive Officer Employee Group . . . . . . . . . . -- --
(1) The dollar value of the options granted depends upon the future market
price of the Common Stock and therefore is not presently determinable.
(2) Includes options to purchase 3,000 shares of Common Stock issuable to
each of Messrs. Sabin and Muir.
REQUIRED VOTE FOR APPROVAL AND RECOMMENDATION OF THE BOARD OF DIRECTORS
The affirmative vote of a majority of the shares present or in person
or represented by proxy and entitled to vote at the meeting is required to
approve the amendments to the Director Plan. The Board of Directors
unanimously recommends that stockholders vote FOR approval of the amendments to
the Director Plan. Proxies solicited by the Board of Directors will be so
voted unless stockholders specify otherwise on their proxy cards.
6
10
PROPOSAL 3
AMENDMENT OF THE EMPLOYEE PLAN
At the Annual Meeting, the stockholders of the Company will be asked
to consider and vote upon a proposal to amend the 1993 Stock Option Plan of
Excel Realty Trust (the "Employee Plan") described herein. The Plan was
adopted by the Company's Board of Directors on May 3, 1993, and approved by the
stockholders on July 12, 1993.
General Nature and Purposes. The Employee Plan was adopted (i) to
further the growth, development and financial success of the Company by
providing additional incentives to certain of its key employees who have been
or will be given responsibility for the management or administration of the
Company's business affairs, by assisting them to become owners of capital stock
of the Company and thus to benefit directly from its growth, development and
financial success, and (ii) to enable the Company to obtain and retain the
services of the type of professional, technical and managerial employees
considered essential to the long-range success of the Company, by providing and
offering such prospective an opportunity to become owners of capital stock of
the Company under employee stock options.
The Employee Plan authorizes the granting of "incentive stock options"
(as defined in Section 422 of the Code) and non-qualified stock options.
Options may be granted under the Employee Plan for a period through May 3, 2003
unless the Employee Plan is earlier terminated. The Employee Plan may be
wholly or partially amended or otherwise modified, suspended or terminated at
any time by the Stock Option Committee (the "Committee") appointed to
administer the Employee Plan, except that stockholder approval is required to
increase the number of shares that may be issued under the Employee Plan, to
materially modify eligibility requirements for participants, to reduce the
minimum option price below the fair market value of the shares when an option
is granted, to extend the term of the Employee Plan or to modify the Employee
Plan in a manner requiring stockholder approval under Rule 16b-3 of the
Securities and Exchange Commission. The Employee Plan is not subject to the
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and is not a qualified plan under Section 401(a) of the Code.
Proceeds received by the Company from the sale of Common Stock pursuant to the
exercise of options granted under the Employee Plan will be used for general
corporate purposes.
A brief description of the material features of the Employee Plan
follows, but the description is qualified in its entirety by the terms of the
Employee Plan, a copy of which is included as Exhibit "B" to this Proxy
Statement.
Securities Subject to the Plan. The aggregate number of shares which
may be issued upon exercise of options granted under the Employee Plan shall
not exceed the greater of (a) 200,000 and (b) the excess of (i) 5% of the
number of outstanding shares of the Company's Common Stock over (ii) 300,000;
provided, however, in no event shall the aggregate number of shares which may
be issued upon exercise of options exceed 700,000. Subject to such overall
limitation, there is no restriction as to the number of options or as to the
maximum number of shares that may be granted to any employee. The Employee
Plan provides for appropriate adjustments in the number and kind of shares
subject to the Employee Plan and to outstanding options in the event of a stock
split, stock dividend or certain other similar changes in the Company's Common
Stock and in the event of a merger, consolidation or certain other types of
recapitalizations.
Administration of the Plan. The Plan provides for administration by
the Committee, consisting of at least two Directors, appointed from time to
time (and removable) by the Company's Board of Directors. No person is
eligible to serve on the Committee unless such person is then a "disinterested
person" within the meaning of paragraph (c)(2) of Rule 16b-3. Options may not
be granted to any member of the Committee during the term of such person's
membership on the Committee. The current members of the Committee are Mr.
Lindquist, Mr. Parsons and Mr. Staller.
In addition to administering the Plan, the Committee is also
authorized to interpret the Plan and the Stock Option Agreements, to adopt such
rules for the administration, interpretation and application of the Plan as are
consistent therewith and to interpret, amend or revoke any such rules. The
Board has not retained the right to exercise the rights or duties of the
Committee under the Plan.
7
11
Members of the Committee shall receive such compensation for their
services as may be determined by the Board of Directors, and all expenses and
liabilities that they incur in connection with the administration of the
Employee Plan will be borne by the Company. The Committee may at any time
suspend or terminate the Employee Plan, subject to rights under options
previously granted.
Eligibility and Participation. Any executive or other key employee of
the Company or of any corporation which is then a subsidiary of the Company (as
such terms are defined in the Plan) will be eligible to be granted options.
Approximately thirty-five (35) persons are eligible to participate in the
Employee Plan. Directors of the Company (other than those serving as members
of the Committee) are eligible to be granted options if they are also
employees. More than one option may be granted to an individual.
The Committee is authorized to determine which individuals are
executive or other key employees, to select from among them the individuals to
whom options are to be granted, to determine the number of shares to be subject
to such options, to designate whether such options will be incentive stock
options or non-qualified stock options and to establish the terms and
conditions of the options, consistent with the Employee Plan.
Exercisability of Options. Options are exercisable at such times and
in such installments (which may be cumulative) as the Committee may provide in
the terms of each individual option. Generally, an option will not be
exercisable during the first six months after such option is granted. Subject
to certain limitations, the Committee may, on such terms and conditions as it
deems appropriate, accelerate the time at which an option or any portion
thereof may be exercised. No portion of an option which is unexercisable at
termination of employment may thereafter become exercisable. To the extent
that the aggregate fair market value of stock with respect to which incentive
stock options (determined without regard to the vesting limitations contained
in Section 422(d) of the Code) are exercisable for the first time by an
optionee during any calendar year (under the Employee Plan and all other
incentive stock option plans of the Company, any subsidiary and any parent
corporation) exceeds $100,000, such options will be taxed as non-qualified
stock options. For this purpose, the fair market value of stock shall be
determined as of the time the option is granted.
Options are exercisable in whole or in part by written notice to the
Company, specifying the number of shares being purchased and accompanied by
payment of the purchase price for such shares. The option price must be paid
in cash or by check or, with the consent of the Committee, by delivery of
shares of the Company's Common Stock owned by the optionee or issuable upon
exercise of the option or by delivery of a recourse, interest-bearing
promissory note where permitted by law. The Committee may, as a condition to
the exercise of any option, require that the optionee deliver such
representations and documents as it deems necessary to effect compliance with
applicable federal and state securities laws and regulations. The Committee
may also take whatever additional action it deems appropriate to effect such
compliance.
On the date the option price is to be paid, the optionee (or his
successor) must make full payment to the Company of all amounts that must be
withheld by the Company for federal, state or local tax purposes. Any such tax
withholding may be paid in cash, by check or, with the Committee's consent,
with shares of the Company's Common Stock.
Shares of the Company's Common Stock, whether or not issuable to the
optionee upon exercise of an option, may be used to satisfy the option price or
the tax withholding consequences of such exercise only (i) during the period
beginning on the third business day following the date of release of the
quarterly or annual summary statement of sales and earnings of the Company and
ending on the twelfth business day following such date or (ii) pursuant to an
irrevocable written election by the optionee to use shares of the Company's
Common Stock to pay all or part of the option price or the withholding taxes
(subject to the approval of the Committee) made at least six months prior to
the payment of such option price or withholding taxes.
Stock Option Agreements; Consideration to the Company. In
consideration of the granting of an option, the employee to whom such option is
granted will agree, in a written Stock Option Agreement, to remain in the
employ of the Company, or a subsidiary of the Company, for a period of at least
one year after the option is granted. Nothing in the Employee Plan or in any
Stock Option Agreement will confer upon any optionee any right to continue in
the employ of the Company, or any subsidiary of the Company, or will interfere
with or restrict in any way the rights of the Company, or a subsidiary of the
Company, to discharge any optionee at any time for any reason whatsoever, with
or without cause.
8
12
Purchase Price of Shares Subject to Options. The price of the shares
of Common Stock subject to each option shall be set by the Committee; provided,
however, that the price per share of an option shall be not less than 100% of
the fair market value of such option.
For purposes of the Employee Plan, the fair market value of a share of
the Company's Common Stock as of a given date will be: (i) the closing price
of a share of the Company's Common Stock on the principal exchange on which
such shares are then trading, if any, on the trading day immediately preceding
such date, or, if shares are not traded on such date, then on the next
preceding trading date during which a sale occurred; or (ii) if such stock is
not traded on an exchange but is quoted on Nasdaq or a successor quotation
system, (1) the last sales price (if the stock is then listed as a National
Market Issue under the Nasdaq National Market System) or (2) the mean between
the closing representative bid and asked prices (in all other cases) for the
stock on the trading day immediately previous to such date as reported by
Nasdaq or such successor quotation system; or (iii) if such stock is not
publicly traded on an exchange and not quoted on Nasdaq or a successor
quotation system, the mean between the closing bid and asked prices for the
stock, on the trading day immediately preceding such date, as determined in
good faith by the Committee; or (iv) if the Company's Common Stock is not
publicly traded, the fair market value established by the Committee acting in
good faith.
Non-Assignability. Options may be transferred only by will or by the
laws of descent and distribution. During a participant's lifetime, options are
exercisable only by the participant. No option or interest or right therein or
part thereof will be liable for the debts, contracts or engagements of the
optionee or the optionee's successors in interest or will be subject to
disposition by transfer, alienation, pledge, encumbrance, assignment or any
other means, whether voluntary, involuntary or by operation of law.
Expiration of Options. Options may not be exercised to any extent by
anyone after the first to occur of the following events: (1) the expiration of
ten years from the date the option was granted (whether or not the Employee
Plan has expired or been terminated) or (2) the expiration of three months from
the date of the employee's termination of employment by reason of retirement or
other termination (with or without cause) (but excluding termination of
employment by reason of death or permanent disability) or (3) the expiration of
one year from the date of the employee's termination of employment in the case
of an employee subject to a permanent disability (within the meaning of Section
22(e)(3) of the Code), unless the optionee dies within such one-year period, or
(4) the expiration of one year from the date of the employee's death.
Subject to the foregoing, the Committee will provide, in the terms of
each individual option, when such option expires and becomes unexercisable; and
the Committee may provide in the terms of individual options that said options
expire immediately upon a termination of employment for any reason.
Merger, Consolidation, Acquisition, Liquidation or Dissolution of the
Company. The Committee may provide by the terms of any option that such option
cannot be exercised after the merger or consolidation of the Company with or
into another corporation, the acquisition by another corporation or person of
all or substantially all of the Company's assets or 80% or more of the
Company's then outstanding voting stock or the liquidation or dissolution of
the Company. The Committee may also provide for the acceleration of the
exercisability of any such option prior to the occurrence of such merger,
consolidation, acquisition, liquidation or dissolution.
Adjustments upon Change in Capitalization. If the outstanding shares
of Common Stock subject to options are changed into or exchanged for a
different number or kind of shares of the Company or other securities of the
Company by reason of merger, consolidation, recapitalization, reclassification,
stock split-up, stock dividend or combination of shares, the Committee will
make an appropriate and equitable adjustment in the number and kind of shares
as to which all outstanding options, or portions thereof then unexercised, will
be exercisable, to the end that after such event the optionee's proportionate
interest will be maintained as before the occurrence of such event. Such
adjustment will be made without change in the total price applicable to the
option except as results from rounding of share quantities or prices and with
any necessary corresponding adjustment in option price per share. Any such
adjustment made by the Committee will be final and binding upon all optionees,
the Company and all other interested persons.
Transfer Restrictions. Unless otherwise approved in writing by the
Committee, no shares acquired upon exercise of any option by any officer (as
defined in Rule 16a-1(f) of the SEC) may be sold, assigned, pledged, encumbered
or otherwise transferred until at least six months have elapsed from (but
excluding) the date that such
9
13
option was granted. The Committee, in its discretion, may impose such other
restrictions on the transferability of the shares purchasable upon the exercise
of an option as it deems appropriate. Any such other restriction shall be set
forth in the respective Stock Option Agreement and may be referred to on the
certificates evidencing such shares. The Committee may require the employee to
give the Company prompt notice of any disposition of shares of stock, acquired
by exercise of an incentive stock option, within two years from the date of
granting such option or one year after the transfer of such shares to such
employee. The Committee may direct that the certificates evidencing shares
acquired by exercise of an incentive stock option refer to such requirement to
give prompt notice of disposition.
No Rights as a Stockholder. The holders of options will not be, nor
have any of the rights or privileges of, a stockholder of the Company as to
shares covered by an option until such shares are issued by the Company and
delivered to such holders.
Conformity to Securities Laws. The Employee Plan is intended to
conform to the extent necessary with all provisions of the Securities Act and
the Exchange Act and any and all regulations and rules promulgated by the SEC
thereunder, including without limitation Rule 16b-3. The Employee Plan will be
administered, and options will be granted and may be exercised, only in such a
manner as to conform to such laws, rules and regulations. To the extent
permitted by applicable law, the Employee Plan and options granted thereunder
shall be deemed amended to the extent necessary to conform to such laws, rules
and regulations.
Federal Income Tax Aspects of the Plan. The following discussion is a
general summary of the material federal income tax consequences to participants
in the Employee Plan. The discussion is based on the Code, regulations
thereunder, rulings and decisions now in effect, all of which are subject to
change. The summary does not discuss all aspects of federal income taxation
that may be relevant to a particular participant in light of such participant's
personal investment circumstances. Also, state and local income taxes are not
discussed and may vary from locality to locality.
Holders of non-qualified stock options do not realize income as a
result of the grant of such options, but normally realize compensation income
taxable at ordinary income rates upon such options' exercise to the extent that
the fair market value of the shares of Common Stock on the date of the exercise
of such options exceeds the option exercise price paid. However, in the case
of an optionee subject to Section 16(b) of the Exchange Act who has held
non-qualified stock options for less than six months and, with the consent of
the Committee, exercises such options, the ordinary income portion generally
would be calculated using the fair market value of the shares upon the lapse of
the six-month period from the date of grant of such options rather than the
fair market value on the date of exercise, unless the optionee elects to
recognize income immediately upon exercise in accordance with Section 83(b) of
the Code. The Company will be entitled to a tax deduction in an amount equal
to the amount that the optionee is required to include in ordinary income at
the time of such inclusion, and will be required to withhold taxes on such
ordinary income. The optionee's initial tax basis for shares acquired upon the
exercise of a non-qualified stock option will be the option exercise price paid
plus the amount of ordinary income realized by the optionee. Any appreciation
in the value of such shares may qualify for capital gains treatment depending
upon the applicable holding period.
Holders of incentive stock options will not be considered to have
received taxable income upon either the grant of the option or its exercise.
Upon the sale or other taxable disposition of the shares of the Common Stock,
long-term capital gain will normally be recognized in the full amount of the
difference between the amount realized and the option exercise price if no
disposition of the shares has taken place within either (a) two years from the
date of grant of the incentive stock option or (b) one year from the date of
transfer of the shares of the Common Stock to the optionee upon exercise
(whether or not such optionee is subject to Section 16(b) of the Exchange Act).
If the shares of the Common Stock are sold or otherwise disposed of before the
end of the one-year period or the two-year period, the difference between the
option exercise price and the fair market value of the shares of the Common
Stock on the date of the option's exercise will be taxed as ordinary income;
the balance of the gain, if any, will be taxed as capital gain. If the shares
of the Common Stock are disposed of before the expiration of the one-year
period or the two-year period and the amount realized is less than the fair
market value of the shares at the date of exercise, the optionee's ordinary
income is limited to the amount realized less the option exercise price paid.
The Company will be entitled to a tax deduction in regard to an incentive stock
option only to the extent the optionee has ordinary income upon sale or other
disposition of the shares of the Common Stock.
10
14
The difference between the fair market value of the shares of Common
Stock on the exercise date and the exercise price of an incentive stock option
is generally deemed to be a "tax preference" under the alternative minimum tax
rules of the Code. Since the consequences of the application of these
provisions to individual optionees may vary depending on their particular
circumstances, optionees should consult their personal tax advisors with
respect to these provisions of the Code.
PROPOSED AMENDMENT TO THE EMPLOYEE PLAN
A total of 700,000 shares of Common Stock are currently reserved for
issuance under the Employee Plan, and under the terms of the Employee Plan, the
aggregate number of shares which may be issued upon exercise of options shall
not exceed 700,000, subject to certain adjustments. The Board of Directors
recommends an amendment to the Employee Plan to increase the number of shares
available for issuance under the Employee Plan to 1,450,000 shares.
As of March 12, 1996, options to purchase an aggregate of 672,250
shares of Common Stock had been granted under the Employee Plan. Accordingly,
only 27,750 shares of Common Stock were available for the issuance of new
options. The Board of Directors believes that increasing the number of shares
available for issuance under the Director Plan is necessary in order for the
Executive Compensation and Stock Option Committee to have sufficient
flexibility to carry out its responsibilities to (i) further the growth,
development and financial success of the Company by providing additional
incentives to its executives and (ii) enable the Company to obtain and retain
the services of the type of executives considered essential to the long-range
success of the Company.
REQUIRED VOTE FOR APPROVAL AND RECOMMENDATION OF THE BOARD OF DIRECTORS
The affirmative vote of a majority of the shares present or in person
or represented by proxy and entitled to vote at the meeting is required to
approve the amendments to the Employee Plan. The Board of Directors
unanimously recommends that stockholders vote FOR approval of the amendments to
the Employee Plan. Proxies solicited by the Board of Directors will be so
voted unless stockholders specify otherwise on their proxy cards.
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of April 1, 1996, the Company had 1,651 stockholders of record.
The following table sets forth information regarding beneficial ownership of
the shares of Common Stock as of such date by (i) each of the Company's
officers and directors, (ii) the Company's officers and directors as a group
and (iii) all other stockholders who beneficially own more than five percent of
the Company's Common Stock. For purposes of this Proxy Statement, beneficial
ownership of securities is defined in accordance with the rules of the
Securities and Exchange Commission (the "SEC") and means generally the power to
vote or exercise investment discretion with respect to securities, regardless
of any economic interests therein. Except as otherwise indicated, the Company
believes that the beneficial owners of the securities listed below have sole
investment and voting power with respect to such shares, subject to community
property laws where applicable. Unless otherwise indicated, the business
address for each of the individuals listed below is c/o Excel Realty Trust,
Inc., 16955 Via Del Campo, Suite 110, San Diego, California 92127.
11
15
Number of Shares Percent
Name Beneficially Owned(1) Beneficially Owned
------------------------------------- --------------------- ------------------
OFFICERS AND DIRECTORS
Gary B. Sabin(2). . . . . . . . . . . . . . . . . . 935,583 7.07%
Chief Executive Officer, President,
Chairman of the Board
Richard B. Muir . . . . . . . . . . . . . . . . . . 210,748 1.60%
Executive Vice President, Secretary,
Director
Ronald B. Sabin . . . . . . . . . . . . . . . . . . 156,453 1.18%
Senior Vice President
David A. Lund . . . . . . . . . . . . . . . . . . . 105,581 *
Chief Financial Officer, Treasurer
Graham R. Bullick . . . . . . . . . . . . . . . . . 81,698 *
Senior Vice President
Mark T. Burton . . . . . . . . . . . . . . . . . . 75,212 *
Sr. Vice President/Acquisitions
S. Eric Ottesen . . . . . . . . . . . . . . . . . . 22,000 *
Sr. Vice President/General Counsel
John H. Wilmot(3) . . . . . . . . . . . . . . . . . 104,412 *
Director
Bruce A. Staller(4) . . . . . . . . . . . . . . . . 16,266 *
Director
Boyd A. Lindquist(5). . . . . . . . . . . . . . . . 8,477 *
Director
Robert E. Parsons, Jr.(6) . . . . . . . . . . . . . 7,796 *
Director
D. Charles Marston . . . . . . . . . . . . . . . . 7,332 *
Director
OFFICERS AND DIRECTORS AS A GROUP . . . . . . . . . 1,709,558 12.92%
(11 persons)
Fidelity Management & Research Company(7) . . . . . 1,655,790 12.63%
82 Devonshire Street
Boston, MA 02109
NewSouth Capital Management, Inc.(8). . . . . . . . 664,453 5.02%
1000 Ridgeway Loop Rd.
Suite 233
Memphis, TN 38120
- --------------------
* Represents less than 1% of the outstanding shares of stock.
1. Includes options to purchase shares, exercisable within sixty days, as
follows: Mr. Gary Sabin, 154,000; Mr. Muir, 110,750; Mr. Bullick,
75,000; Mr. Ronald Sabin, 75,000; Mr. Lund, 64,000; Mr. Burton,
56,250; Mr. Lindquist, 7,332; Mr. Marston, 7,332; Mr. Parsons, 4,000;
Mr. Staller, 7,332; and Mr. Wilmot, 4,000.
2. Includes 307,305 shares held by Excel Interfinancial Corporation
("EIC"), of which Gary B. Sabin is the controlling stockholder. Also
includes 5,000 shares in an unaffiliated partnership of which Mr.
Sabin is the controlling partner.
12
16
3. Mr. Wilmot's business address is 4455 E. Camelback Rd., Phoenix,
Arizona 85018.
4. Mr. Staller's business address is 618 W. Hillcrest Blvd., Monrovia,
California 91016.
5. Mr. Lindquist's business address is 23133 Hawthorne Boulevard,
Torrance, California 90505.
6. Mr. Parson's business address is Host Marriott Corporation, 10400
Fernwood Road, Washington, D.C. 20058.
7. Fidelity is a group of funds of which no single fund owns more than 5%
of the Company's Common Stock.
8. Based upon 13G dated February 13, 1996.
13
17
EXECUTIVE COMPENSATION AND OTHER INFORMATION
EXECUTIVE OFFICERS
The information set forth below is submitted with respect to each of
the Company's executive officers.
Name of Individual Capacity in Which Served Age
------------------ ------------------------ ---
Gary B. Sabin Chief Executive Officer, President and 41
Chairman of the Board
Richard B. Muir Executive Vice President and Secretary 40
Ronald H. Sabin Senior Vice President 45
Mark T. Burton Senior Vice President/Acquisitions 35
David A. Lund Chief Financial Officer/Treasurer 44
Graham B. Bullick Senior Vice President 45
S. Eric Ottesen General Counsel and Senior Vice President 40
Gary B. Sabin has served as Chief Executive Officer, President and
Chairman of the Board of the Company since January, 1989. Mr. Sabin has also
served as President of EIC and its affiliates since 1978.
Richard B. Muir has served as Executive Vice President, Secretary and
a Director of the Company since January, 1989 and as Chief Financial Officer
from April, 1992, to June, 1994. Mr. Muir has also served as Executive Vice
President and Secretary of EIC and its affiliates since 1978.
David A. Lund has served as Chief Financial Officer of the Company
since June, 1994. He previously served from 1989 to 1994 in various capacities
with the Company, including Vice President and Vice President of Finance. Mr.
Lund has served in various capacities with EIC and its affiliates since 1983.
Mr. Lund is a certified public accountant. Prior to 1983, Mr. Lund was a
partner in a CPA firm.
Ronald H. Sabin has served as Senior Vice President of the Company in
charge of property management since January 1989. Mr. Sabin is the brother of
Gary B. Sabin. Mr. Ronald Sabin has also served in various capacities with EIC
and its affiliates since 1979.
Mark T. Burton has served as Vice President of the Company since
January, 1989, and was recently promoted to Senior Vice President/Acquisitions.
Mr. Burton's duties for the Company primarily consist of the evaluation and
selection of property acquisitions and dispositions. Mr. Burton has also
served in various capacities with EIC and its affiliates since 1984.
Graham R. Bullick, Ph.D., has served as Senior Vice President of the
Company since January 1991. Mr. Bullick served as an account manager for
Zenger-Miller Inc., an international corporation specializing in organizational
development and service/quality systems, from 1987 to 1991. Mr. Bullick served
as a Director of the Company between October 1991, and February 1992.
S. Eric Ottesen has served as General Counsel and Senior Vice
President of the Company since January 1995. For more than five years prior to
January, 1995, Mr. Ottesen worked as a partner in a law firm based in San
Diego, California.
14
18
SUMMARY COMPENSATION TABLE
The following table shows, for the fiscal years ending December 31,
1993, 1994 and 1995, the compensation of the Company to its Chief Executive
Officer and each of the four most highly compensated executive officers other
than the Chief Executive Officer (collectively, the "Named Executive
Officers").
Other Securities All Other
Annual Restricted Under- Compen-
Name and Bonus Compen- Stock lying sation
Principal Position Year Salary(1) (2) sation (3) Awards Options (4)
------------------ ---- --------- --------- ----------- ------ ------- -----------
Gary B. Sabin 1995 $251,000 $126,000 $ 3,975 -- 37,000(5) $4,620
Chief Executive 1994 240,000 99,600 4,260 -- 2,000(5) 4,500
Officer, President 1993 200,000 120,000 3,846 -- 101,666(5) 4,497
and Chairman of
the Board
Richard B. Muir 1995 146,417 73,500 7,196 -- 28,250(5) 4,620
Executive Vice 1994 140,000 58,100 5,704 -- 2,000(5) 4,500
President and 1993 116,533 70,000 6,355 -- 71,666(5) 3,554
Secretary
David A. Lund 1995 125,000 62,500 -- -- 17,500 4,620
Chief Financial 1994 114,583 36,000 -- -- -- 4,038
Officer and 1993 89,487 20,000 1,949 -- 30,000 2,743
Treasurer
Ronald H. Sabin 1995 110,000 55,000 6,000 -- 17,500 4,620
Senior Vice 1994 110,000 40,000 6,895 -- -- 3,300
President 1993 96,533 44,000 6,449 -- 50,000 3,089
Graham B. Bullick 1995 110,000 55,000 9,194 -- 17,500 3,575
Senior Vice 1994 110,000 40,000 6,895 -- -- 3,300
President 1993 96,533 44,000 2,747 -- 50,000 2,500
- --------------------
(1) Includes compensation that was accrued and deferred pursuant to the
Company's 401(k) Plan.
(2) Bonuses for 1994 and 1993 were awarded pursuant to employment
contracts which were entered into in April 1993 or, with respect to
David A. Lund, by grant of the Executive Compensation and Stock Option
Committee. The 1994 bonuses were declared and paid in February 1995,
and were included in the 1994 financial statements. The indicated
bonuses for 1993 were declared and paid in April 1994, after the
Company's financial statements for 1993 had been prepared. The 1995
bonuses were declared and paid in February 1996 and were included in
the 1995 financial statements.
(3) Includes car allowance and miscellaneous incentive compensation prior
to the Company's initial public offering in August 1993.
(4) Comprised of 401(k) contributions by the Company.
(5) Includes stock options granted in capacity as a Director of the
Company.
STOCK OPTION GRANTS TABLE
The following table provides information concerning the grant of stock
options to the Named Executive Officers as of the end of the last fiscal year.
The Company does not have any outstanding stock appreciation rights.
15
19
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
RATES OF STOCK
PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(1)
- ---------------------------------------------------------------------------- -------------------------------------
Number of % of Total
Securities Options
Underlying Granted to
Options Employees in Exercise or Base Expiration
Name Granted Fiscal Year Price Date 5% 10%
---- ------------ ------------- ------------------- ---------- -- ---
Gary B. Sabin . . . . . . . 100,000(2) 31% $19.75 01-Apr-2003 $945,639 $2,118,071
2,000(3) 50% $19.63 25-May-2004 $22,536 $52,100
35,000 26% $19.25 19-May-2005 $460,658 $1,081,987
2,000(3) 1% $20.13 25-May-2005 $24,625 $60,235
40,000 19% $20.38 29-Jan-2006 $526,419 $1,329,715
Richard B. Muir . . . . . . 70,000(2) 22% $19.75 01-Apr-2003 $661,947 $1,482,650
2,000(3) 50% $19.63 25-May-2004 $22,536 $52,100
26,250 20% $19.25 19-May-2005 $345,493 $811,490
2,000(3) 1% $20.13 25-May-2005 $24,625 $60,235
28,000 13% $20.38 29-Jan-2006 $368,493 $930,801
David A. Lund . . . . . . . 30,000(2) 9% $19.75 01-Apr-2003 $283,692 $635,421
17,500 13% $19.25 19-May-2005 $230,329 $540,994
24,000 11% $20.38 29-Jan-2006 $315,852 $797,829
Ronald H. Sabin . . . . . . 50,000(2) 15% $19.75 01-Apr-2003 $472,819 $1,059,036
17,500 13% $19.25 19-May-2005 $230,329 $540,994
20,000 9% $20.38 29-Jan-2006 $263,210 $664,858
Graham B. Bullick . . . . . 50,000(2) 15% $19.75 01-Apr-2003 $472,819 $1,059,036
17,500 13% $19.25 19-May-2005 $230,329 $540,994
20,000 9% $20.38 29-Jan-2006 $263,210 $664,858
- --------------------
(1) Based on price of $20.50 per share at December 31, 1995.
(2) Except as otherwise indicated, these options were granted pursuant to
the employment agreements of the Named Executive Officers (or in the
case of Mr. Lund, pursuant to a grant by the Executive Compensation
and Stock Option Committee), and are exercisable according to the
following schedule: one-fourth of such options became exercisable on
April 1, 1994 and April 1, 1995, respectively; thereafter, one-fourth
will be exercisable beginning on each of the next two succeeding
anniversaries of such date. The exercise price of the options was
equal to the market price on the date of grant.
(3) These options were granted to Messrs. Sabin and Muir in May 1994 and
May 1995 in their capacities as Directors, and became immediately
exercisable as of the date of grant. The exercise price of the
options was equal to the market price on the date of grant.
16
20
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE
The following table sets forth information with respect to the Named
Executive Officers, concerning the exercise of stock options during the last
fiscal year and unexercised options held as of the end of the fiscal year.
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
Year End Year End (2)
Number of ---------- ------------
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise Realized (1) Unexercisable Unexercisable
---- ------------ ------------ ------------- -------------
Gary B. Sabin . . . . . . . . . . 0 0 114,000/25,000 $102,480/18,750
Richard B. Muir . . . . . . . . . 0 0 82,750/17,500 $78,668/13,125
David A. Lund . . . . . . . . . . 0 0 40,000/7,500 $38,750/5,625
Ronald H. Sabin . . . . . . . . . 0 0 55,000/12,500 $50,000/9,375
Graham R. Bullick . . . . . . . . 0 0 55,000/12,500 $50,000/9,375
- --------------------
(1) Fair market value of underlying securities at exercise minus the
exercise price.
(2) Represents the differences between the closing price of the Common
Stock on December 31, 1995, and the exercise price of the options.
EMPLOYMENT AGREEMENTS
The Company has entered into separate employment agreements with
Messrs. Gary Sabin, Muir, Ronald Sabin and Bullick as of April 1, 1993. Each
of these agreements is automatically extended for an additional year at the end
of each year of the agreement, subject to the right of either the Company or
said employees to terminate the contract voluntarily by giving at least three
month's prior written notice. Pursuant to the respective agreements, each
employee is required to devote substantially all of his business time to the
Company. Each of the agreements provides for an annual base salary as well as
an automobile allowance, an award of stock options and medical insurance
coverage. The employment contracts provided for annualized base salaries in
1995 as follows: Mr. Sabin, $252,000; Mr. Muir, $147,000; Mr. Ronald Sabin,
$110,000; and Mr. Bullick, $110,000. In addition, each of such employees is
entitled to annual bonus compensation and options to be determined by the
Executive Compensation and Stock Option Committee of the Board of Directors.
The award of any bonus or option compensation, however, is dependent on the
achievement of certain performance levels by the Company, including per share
growth in funds from operations and cash flow. The employment contracts also
provided for an award of stock options as follows: Mr. Sabin, 100,000; Mr.
Muir, 70,000; Mr. Ronald Sabin, 50,000; and Mr. Bullick, 50,000. The stock
options awarded pursuant to such contracts will be exercisable until April 1,
2003 at an exercise price of $19.75 per share (the initial public offering
price of the stock in August 1993), and exercisable according to the following
schedule: one-fourth of such options became exercisable beginning on April 1,
1994, and thereafter one-fourth will be exercisable beginning on each of the
next three succeeding anniversaries of such date.
EXECUTIVE COMPENSATION AND STOCK OPTION COMMITTEE REPORT
Set forth below in full is the Report of the Executive Compensation
and Stock Option Committee (the "Committee") regarding the compensation paid by
the Company to its executive officers during 1995:
Stockholders are interested in how companies pay their executives,
both in terms of the plan designs that generate pay, and in the ultimate amount
of compensation. Following is a discussion of the thought process that has
gone into the Company's 1995 executive pay plans and amounts.
General. The Committee has implemented compensation policies which seek to
enhance the profitability of the Company, and thus stockholder values by
aligning closely the financial interests of the Company's management with those
of its stockholders.
Currently, executive pay consists of three elements that are designed
to meet those policies:
17
21
o Base salary, paid based primarily on job content and peer
group comparisons. The Committee believes that base salaries
at least at market average are essential to retaining good
performers.
o Bonuses, which are based primarily upon the achievement of
certain performance levels by the Company including per share
growth in funds from operations.
o Stock options, which allow executives to benefit when stock
price increases. The Committee believes that its grant of
stock options, along with the award of bonuses based on
Company performance, aligns executives' interests with
stockholders.
Following is additional information regarding each of the above
elements.
Base Salary. The Company entered into employment contracts with Messrs.
Gary Sabin, Muir, Bullick and Ronald Sabin on April 1, 1993 (the "Employment
Contracts"). The salaries paid to each of such executive officers in 1995, as
set forth in the Summary Compensation Table above, are comparable to salaries
paid in 1995 to executive officers at similarly sized comparable companies.
Bonuses. The Employment Contracts allow for bonus awards of up to
approximately 50% of base salary, dependent upon the Company's achievement of
certain performance levels, including 1) growth in funds from operations; 2) a
comparison of peer group compensation and 3) execution of the Company's
strategic plan. Bonuses for 1995 were awarded by the Committee pursuant to
employment contracts which were entered in April 1993. Such bonus amounts, as
indicated in the Summary Compensation Table, were declared and paid in February
1996, and were awarded with respect to service to the Company from January 1,
1995, through December 31, 1995. The bonus awards for 1995 were based in part
on the Company's performance in 1995. In 1995, the Company's funds from
operations increased 27% to $27.9 million ($2.31 per share) as compared to
$21.9 million ($2.01 per share) for fiscal 1994. Revenue and net income also
increased in 1995 compared to 1994.
Stock Options. Options to purchase shares were issued during 1995 to the
Named Executive Officers as indicated in the Summary Compensation Table under
the 1993 Stock Option Plan. The options were granted based upon the
Committee's determination that the performance of the Company during 1995, as
discussed above, warranted such options. Stock value must increase from the
value at time of grant in order for option holders to realize any benefit from
these rewards. Thus, option holders benefit only if all stockholders benefit.
Chief Executive Officer Pay. Amounts earned during 1995 by the Chief
Executive Officer, Mr. Gary Sabin, are shown in the Summary Compensation Table.
Some additional notes regarding his pay follow.
o The base salary for Mr. Sabin, as set forth in the Summary
Compensation Table, is believed by the Committee to be
comparable to the base salary of chief executive officers of
other public companies of comparable size.
o Mr. Sabin's maximum bonus payable under his employment
contract is approximately 50% of base salary. This is
consistent with, or even somewhat conservative compared to,
other public companies of a similar size. Mr. Sabin was
awarded a bonus for 1995 in the amount of 50% of his base
salary under his employment agreement.
o During 1993, Mr. Sabin received options to purchase 100,000
shares of stock at $19.75 and, in his capacity as a Director
of the Company, 1,666 shares at $13.92, the then prevailing
market price. During 1994, Mr. Sabin, in his capacity as a
Director of the Company received options to purchase 2,000
shares of stock at $20.13 per share. During 1995, Mr. Sabin
received options to purchase 35,000 shares of stock at $19.25
per share and to purchase 40,000 shares of stock at $20.375
per share. The option for 35,000 shares was granted in May
1995 for services performed in 1994. The option for 40,000
shares was granted in January 1996, for services performed in
1995. During 1995, Mr. Sabin also received options to
purchase 2,000 shares of stock at $19.63 per share in his
capacity as a Director of the Company. The exercise price of
all such options is equal to the market price at date of
grant. The Committee believes that this long-term incentive
opportunity is conservative when compared to other public
companies of comparable size.
18
22
Summary. Currently, the Company's executive compensation program rewards
the following elements of performance:
o Individual performance is rewarded through continued
employment with the Company, and to some extent through the
bonus plan.
o Achievement of internal company goals is rewarded through the
bonus plan.
o Stock price performance is rewarded through increases in the
value of previously granted stock options.
The Committee believes that the current program has been effective in
rewarding executives appropriately for performance, retaining good performers,
and aligning executives' interests with those of stockholders. While the
Committee is pleased with the current compensation system, it reserves the
right to make changes to the program as are necessary to continue to meet its
stated goals in future years.
Benefits also are offered to officers that are not based on
performance. Such benefits provide a safety net of protection in the event of
illness, disability, death, retirement, etc. Such a safety net is provided to
most of the employees of the Company.
The Executive Compensation and Stock Option
Committee of the Company's Board of Directors
Boyd A. Lindquist
Robert E. Parsons, Jr.
Bruce A. Staller
March 25, 1996
PERFORMANCE GRAPH
The following performance graph compares the performance of the
Company's Common Stock to the S&P 500 Index and to the published National
Association of Real Estate Investment Trust's ("NAREIT") All Equity Index
(excluding Health Care REITs). The graph assumes that the value of the
investment in the Company's Common Shares and each index was 100 at December
31, 1988 and that all dividends were reinvested.
COMPARISON OF SIX-YEAR CUMULATIVE RETURN
[CHART]
1990 1991 1992 1993 1994 1995
---- ---- ---- ---- ---- ----
EXCEL 100 121 130 168 167 226
NAREIT 100 129 156 185 191 218
S&P 500 100 131 141 155 157 215
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In 1995, a taxable affiliate company, ERT Development Corporation
("ERT"), was formed to assist in the Company's acquisition of additional
properties. The Company owns 100% of the outstanding preferred shares of ERT.
The preferred shares receive 95% of the dividends, if any, from ERT. One
hundred percent (100%) of the outstanding common shares of ERT are owned by
EIC. Gary B. Sabin, who is President, Chief Executive Officer and Chairman of
the Board of the Company, is President, Chief Executive Officer and Chairman of
the Board of EIC, and certain other officers of the Company serve as officers
and directors of EIC. Mr. Sabin owns a controlling interest in EIC, and all of
the outstanding shares of EIC are owned by Mr. Sabin and certain other
19
23
officers of the Company. At December 31, 1995, the Company had notes
receivable outstanding to ERT of $12.6 million to facilitate certain
transactions.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Under Section 16(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), directors, officers and beneficial owners of 10 percent
or more of the Company's Common Stock ("Reporting Persons") are required to
report to the SEC on a timely basis the initiation of their status as a
Reporting Person and any changes with respect to their beneficial ownership of
the Company's Common Stock. Regulations promulgated by the SEC require the
Company to disclose in this Proxy Statement any reporting violations with
respect to the 1993 fiscal year, which came to the Company's attention based on
a review of the applicable filings required by the SEC to report such status as
an officer or director or such changes in beneficial ownership as submitted to
the Company. Based solely on its review of such forms received by it, the
Company is aware of the following instances of noncompliance, or late
compliance, with such filing requirements during the fiscal year ended December
31, 1995, by its executive officers, directors, and beneficial owners of more
than ten percent of the Company's Common Stock: In March, 1996, each of the
Company's officers and directors filed amended Form 5s to report option grants
which previously had not been reported and, for two directors, to report shares
acquired pursuant to the Company's Dividend Reimbursement Plan.
OTHER BUSINESS
No other matters are to be presented for action at the Annual Meeting
other than as set forth in Proposals 1, 2 and 3 of this Proxy Statement. If
other matters should properly come before the meeting, however, the persons
named in the accompanying Proxy will vote all Proxies in accordance with their
best judgment.
ANNUAL REPORT
The Annual Report of the Company for the fiscal year ended December
31, 1995, is provided with this Proxy Statement to the stockholders of record
as of April 1, 1996. However, the Annual Report does not constitute, and
should not be considered, a part of this Proxy solicitation material.
STOCKHOLDERS' PROPOSALS
Any proposal to be considered for inclusion in the Company's proxy
statement for the next annual meeting shall be received at the Company's
principal executive offices not later than December 1, 1996.
STOCKHOLDERS ARE URGED TO IMMEDIATELY MARK, DATE, SIGN AND RETURN THE ENCLOSED
PROXY IN THE ENVELOPE PROVIDED, TO WHICH NO POSTAGE NEED BE AFFIXED IF MAILED
IN THE UNITED STATES.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ RICHARD B. MUIR
RICHARD B. MUIR
Executive Vice President and Secretary
April 1, 1996
San Diego, California
20
24
EXHIBIT "A"
EXCEL REALTY TRUST, INC.
DIRECTORS' 1994 STOCK OPTION PLAN
(AMENDED AND RESTATED MAY 10, 1996)
(SUBMITTED FOR STOCKHOLDER APPROVAL MAY 10, 1996)
1. PURPOSE OF THE PLAN. Under this Amended Directors' 1994 Stock
Option Plan (the "Plan") of EXCEL REALTY TRUST, INC. (the "Company"), options
shall be granted to directors of the Company to purchase shares of the
Company's capital stock. The Plan is designed to enable the Company to attract
and retain directors of the highest caliber and experience.
2. STOCK SUBJECT TO PLAN. The maximum number of shares of stock
for which options granted hereunder may be exercised shall be 240,000 shares of
the Company's Common Stock, par value $.01 per share, subject to the
adjustments provided in Section 7. Shares of stock subject to the unexercised
portions of any options granted under this Plan which expire or terminate or
are cancelled may again be subject to options under the Plan.
3. PARTICIPATING DIRECTORS. The directors of the Company who
shall participate in this Plan are each of the current and future directors who
have been duly elected and qualified.
4. ADMINISTRATION.
(a) The Plan shall be administered by a committee (the
"Committee") which shall consist of two or more directors, appointed
by and holding office at the pleasure of the Board, each of whom is a
"disinterested person" as defined by Rule 16b- 3 and an "outside
director" within the meaning of Section 162(m)(4)(C)(ii) of the
Internal Revenue Code of 1986, as amended (the "Code"). Appointment
of Committee members shall be effective upon acceptance of
appointment. Committee members may resign at any time by delivering
written notice to the Board. Vacancies in the Committee shall be
filled by the Board.
(b) It shall be the duty of the Committee to conduct the
general administration of the Plan in accordance with its provisions.
The Committee shall have the power to interpret the Plan and the
options and to adopt such rules for the administration, interpretation
and application of the Plan as are consistent therewith and to
interpret, amend or revoke any such rules. The Board shall have no
right to exercise any of the rights or duties of the Committee under
the Plan.
(c) The Committee shall act by a majority of its members
in office. The Committee may act either by vote at a meeting or by a
memorandum or other written instrument signed by a majority of the
Committee.
(d) Members of the Committee shall receive such
compensation for their services as members as may be determined by the
Board. All expenses and liabilities incurred by members of the
Committee in connection with the administration of the Plan shall be
borne by the Company. The Committee may employ attorneys,
consultants, accountants, appraisers, brokers or other persons. The
Committee, the Company and its officers and directors shall be
entitled to rely upon the advice, opinions or valuations of any such
persons. All actions taken and all interpretations and determinations
made by the Committee in good faith shall be final and binding upon
all option holders, the Company and all other interested persons. No
member of the Committee shall be personally liable for any action,
determination or interpretation made in good faith with respect to the
Plan or the options, and all members of the Committee shall be fully
protected by the Company in respect to any such action, determination
or interpretation.
5. GRANT OF OPTIONS. Each participating director shall be
granted an option for 3,000 shares of stock (subject to the adjustments
provided in Section 7) on the date on which the amended Plan is approved by the
stockholders of the Company. On each anniversary date of such stockholder
approval on which he or she
A - 1
25
continues to serve as a director of the Company (these annual dates of grant
are collectively referred to herein as the "date of grant") each Director then
in office (which would include current and continuing Directors as well as any
Director who later joins the Board) shall receive an option exercisable for a
number of shares determined pursuant to the following formula:
Number of option shares = 3,000 + (250 multiplied by the number of
years of continuous service beginning in 1997, including any portion
of any fiscal year of service as a full year)
The number of shares subject to options allocated under the revised
formula escalates each year as a result of being based on years of service as a
director. Any additional or replacement Director shall, pursuant to the
revised formula, receive on first occurring anniversary of the stockholder's
approval of this amendment, an option for 3,000 shares, which option shall
increase by 250 shares during each year of service thereafter. Notwithstanding
any other provision of this Plan, no option hereunder shall be granted unless
3,000 shares (subject to said upward adjustments) are then available therefor
under Sections 2 and 7. In consideration of the granting of the option, the
option holder shall be deemed to have agreed to remain as a director of the
Company for a period of at least one year after the date of grant. Nothing in
this Plan shall, however, confer upon any option holder any right to continue
as a director of the Company or shall interfere with or restrict in any way the
rights of the Company or the Company's stockholders, which are hereby expressly
reserved, to remove any option holder at any time for any reason whatsoever,
with or without cause, to the extent permitted by the Company's bylaws and
applicable law.
6. OPTION PROVISIONS. Each option granted under the Plan shall
be evidenced by an agreement between the Company and the participating director
and shall contain such terms and provisions as the Committee may authorize,
including in any event the following:
(a) The exercise price of each option shall be equal to
the aggregate fair market value of the shares of stock optioned on the
date of grant of such option. For this purpose, the Fair Market Value
of a share of the Company's Common Stock as of a given date shall be
(i) the closing price of a share of the Company's Common Stock on the
principal exchange on which shares of the Company's Common Stock are
then trading, if any, on the trading day previous to such date, or, if
shares were not traded on the day previous to such date, then on the
next preceding trading day during which a sale occurred; or (ii) if
such Common Stock is not traded on an exchange but is quoted on Nasdaq
or a successor quotation system, (1) the last sales price (if the
Company's Common Stock is then listed as a National Market Issue under
the NASD National Market System) or (2) the mean between the closing
representative bid and asked prices (in all other cases) for the
Company's Common Stock on the trading day previous to such date as
reported by Nasdaq or such successor quotation system; or (iii) if
such Common Stock is not publicly traded on an exchange and not quoted
on Nasdaq or a successor quotation system, the mean between the
closing bid and asked prices for the Company's Common Stock, on the
trading day previous to such date, as determined in good faith by the
Committee; or (iv) if the Company's Common Stock is not publicly
traded, the fair market value established by the Committee acting in
good faith.
(b) Payment for stock purchased upon any exercise of the
option shall be made in full in cash concurrently with such exercise.
However, at the discretion of the Board, the terms of the option may:
(i) subject to the timing requirements of paragraph 6(j), allow
payment, in whole or in part, through the surrender of shares of
Common Stock then issuable upon exercise of the option having a Fair
Market Value on the date of option exercise equal to the aggregate
exercise price of the option or exercised portion thereof; (ii) allow
payment, in whole or in part, through the delivery of a promissory
note bearing interest (at no less than such rate as shall then
preclude the imputation of interest under the Code) and payable upon
such terms as may be prescribed by the Board, or (iii) allow payment
through any combination of the consideration provided in the foregoing
subparagraphs (i) and (ii). In the case of a promissory note, the
Board may also prescribe the form of such note and the security to be
given for such note. The Option may not be exercised, however, by
delivery of a promissory note or by a loan from the Company when or
where such loan or other extension of credit is prohibited by law.
A - 2
26
(c) In the case of options which are granted to directors
who are employees of the Company, such directors shall reimburse the
Company in cash for all amounts which the Company is required to
withhold under federal, state or local law in connection with the
exercise of the Option.
(d) The option shall become immediately exercisable.
(e) Any option holder who ceases to be a director,
whether because of death, resignation, removal, expiration of his or
her term of office or any other reason, shall have the right to
exercise the option for thirty (30) days after such event (but not
after the expiration date of the option), at which time the option
shall terminate and may no longer be exercised, except that (i) in the
event of the death of an option holder (x) who is at the time of his
or her death a director of the Company and who has served as a
director since the date of grant of the option, the option may be
exercised at any time within one year following the date of death (but
not after the expiration date of the option), by the option holder's
estate or by a person who acquired the right to exercise the option by
bequest or inheritance, or (y) within thirty (30) days after the
termination of the option holder's status as a director of the
Company, the option may be exercised at any time within six (6) months
after the date of death (but in no event after the expiration date of
the option) by the option holder's estate or by a person who acquired
the right to exercise the option by bequest or inheritance, and (ii)
upon the option holder's ceasing to be a director by reason of
disability he or she (or his or her guardian) shall have the right to
exercise the option within one year after the date the option holder
ceased to be a director (but not after the expiration date of the
option.
(f) Notwithstanding any other provision herein, such
option may not be exercised prior to approval of this Plan by the
Company's stockholders having a majority of the voting power of the
outstanding stock; nor prior to the admission of the shares of stock
issuable on exercise of the option to listing on notice of issuance on
any stock exchange on which shares of the same class are then listed;
nor unless and until such securities may be issued and delivered
without causing the Company to be in violation of or incur any
liability under any federal, state or other securities law, any
requirement of any securities exchange listing agreement to which the
Company may be a party, or any other requirement of law or of any
regulatory body having jurisdiction over the Company.
(g) The option shall not be transferable by the option
holder other than by will or the laws of descent and distribution, may
not be pledged or hypothecated, and shall be exercisable during the
option holder's lifetime only by the option holder or by his or her
guardian or legal representative.
(h) The term of each option shall be ten (10) years from
the date of grant thereof or such shorter term as may be provided by
the Committee.
(i) Options granted under the Plan are not intended to
qualify, and shall not be designated, as "incentive stock options"
under Section 422 of the Code.
(j) At the discretion of the Board, shares of Common
Stock issuable to the optionee upon exercise of the option may be used
to satisfy the option exercise price or the tax withholding
consequences of such exercise, in the case of persons subject to
Section 16 of the Exchange Act, only (i) during the period beginning
on the third business day following the date of release of the
quarterly or annual summary statement of sales and earnings of the
Company and ending on the twelfth business day following such date or
(ii) pursuant to an irrevocable written election by the optionee to
use shares of Common Stock issuable to the optionee upon exercise of
the option to pay all or part of the option price or the withholding
taxes made at least six months prior to the payment of such option
price or withholding taxes.
7. ADJUSTMENTS. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no options have yet
been granted or
A - 3
27
which have been returned to the Plan upon cancellation or expiration of an
option, as well as the price per share of Common Stock covered by each such
outstanding option, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
shares of Common Stock effected without receipt of consideration by the
Company; provided, however, that conversion of any convertible securities of
the Company shall not be deemed to have been "effected without receipt of
consideration." Such adjustment shall be made by the Committee, whose
determination in that respect shall be final, binding and conclusive. Except
as expressly provided herein, no issuance by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an option.
8. CORPORATE REORGANIZATIONS. In the event of the proposed
dissolution or liquidation of the Company, the option will terminate
immediately prior to the consummation of such proposed action, unless otherwise
provided by the Committee. The Committee may, in the exercise of its sole
discretion in such instances, declare that any option shall terminate as of a
date fixed by the Committee. In the event of a proposed sale of all or
substantially all of the assets of the Company, or the merger of the Company
with or into another corporation, the option shall be assumed or an equivalent
option shall be substituted by such successor corporation or a parent or
subsidiary of such successor corporation, unless the Committee determines, in
the exercise of its sole discretion and in lieu of such assumption or
substitution, that the option holder shall have the right to exercise the
option as to all of the optioned shares, including shares as to which the
option would not otherwise be exercisable. If the Committee makes an option
fully exercisable in lieu of assumption or substitution in the event of a
merger or sale of assets, the Committee shall notify the option holder that the
option shall be fully exercisable for a period of fifteen (15) days from the
date of such notice, and the option will terminate upon the expiration of such
period.
9. DURATION, TERMINATION AND AMENDMENT OF PLAN. This Plan shall
become effective upon its approval by the stockholders of the Company and shall
expire on May 15, 2004, so that no option may be granted hereunder after that
date although any option outstanding on that date may thereafter be exercised
in accordance with its terms. The Board of Directors may alter, amend, suspend
or terminate this Plan, provided that no such action shall deprive an option
holder, without his or her consent, of any option previously granted pursuant
to this Plan or of any of the option holder's rights under such option. Except
as herein provided, no such action of the Board of Directors, unless taken with
the approval of the stockholders of the Company, may make any amendment to the
Plan as to which approval by stockholders is necessary for continued
applicability of Rule 16b-3 of the Securities and Exchange Commission.
Notwithstanding anything to the contrary contained herein, the Board of
Directors with respect to the Plan or any option shall not amend or modify any
provision concerning the amount, price or timing of any option (including,
without limitation the provisions of Sections 2, 5 and 6(a) of the Plan) more
than once every six months other than to comply with changes in the Internal
Revenue Code of 1986, as amended, the Employee Retirement Income Security Act
of 1974, as amended, or the respective rules and regulations thereunder.
A - 4
28
EXHIBIT "B"
1993 STOCK OPTION PLAN
OF
EXCEL REALTY TRUST, INC.
(AMENDED AND RESTATED MAY 10, 1996)
(SUBMITTED FOR STOCKHOLDER APPROVAL MAY 10, 1996)
EXCEL REALTY TRUST, INC., a corporation organized under the laws of
the State of Maryland, hereby adopts this Amended 1993 Stock Option Plan (this
"Plan") of Excel Realty Trust, Inc. The purposes of this Plan are as follows:
(1) To further the growth, development and financial success of
the Company by providing additional incentives to certain of its executive and
other key Employees who have been or will be given responsibility for the
management or administration of the Company's business affairs, by assisting
them to become owners of the Company's Common Stock and thus to benefit
directly from its growth, development and financial success.
(2) To enable the Company to obtain and retain the services of the
type of professional, technical and managerial employees considered essential
to the long-range success of the Company by providing and offering them an
opportunity to become owners of the Company's Common Stock under options,
including options that are intended to qualify as "incentive stock options"
under Section 422 of the Code.
ARTICLE I
DEFINITIONS
Whenever the following terms are used in this Plan, they shall have
the meaning specified below unless the context clearly indicates to the
contrary. The masculine pronoun shall include the feminine and neuter and the
singular shall include the plural, where the context so indicates.
SECTION 1.1 - BOARD
"Board" shall mean the Board of Directors of the Company.
SECTION 1.2 - CODE
"Code" shall mean the Internal Revenue Code of 1986, as amended.
SECTION 1.3 - COMMITTEE
"Committee" shall mean the Stock Option Committee of the Board,
appointed as provided in Section 6.1.
SECTION 1.4 - COMPANY
"Company" shall mean Excel Realty Trust, Inc. In addition, "Company"
shall mean any corporation assuming, or issuing new employee stock options in
substitution for, Incentive Stock Options, outstanding under the Plan, in a
transaction to which Section 424(a) of the Code applies.
SECTION 1.5 - DIRECTOR
"Director" shall mean a member of the Board.
SECTION 1.6 - EMPLOYEE
"Employee" shall mean any employee (as defined in accordance with the
regulations and revenue rulings then applicable under Section 3401(c) of the
Code) of the Company, or of any corporation which is then a
B - 1
29
Subsidiary, whether such employee is so employed at the time this Plan is
adopted or becomes so employed subsequent to the adoption of this Plan.
SECTION 1.7 - EXCHANGE ACT
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
SECTION 1.8 - INCENTIVE STOCK OPTION
"Incentive Stock Option" shall mean an Option which qualifies under
Section 422 of the Code and which is designated as an Incentive Stock Option by
the Committee.
SECTION 1.9 - NON-QUALIFIED OPTION
"Non-Qualified Option" shall mean an Option which is not an Incentive
Stock Option and which is designated as a Non-Qualified Option by the
Committee.
SECTION 1.10 - OFFICER
"Officer" shall mean an officer of the Company, as defined in Rule
16a-1(f) under the Exchange Act, as such Rule may be amended in the future.
SECTION 1.11 - OPTION
"Option" shall mean an option to purchase Common Stock of the Company,
granted under the Plan. "Options" includes both Incentive Stock Options and
Non-Qualified Options.
SECTION 1.12 - OPTIONEE
"Optionee" shall mean an Employee to whom an Option is granted under
the Plan.
SECTION 1.13 - PLAN
"Plan" shall mean this 1993 Stock Option Plan of Excel Realty Trust,
Inc.
SECTION 1.14 - RULE 16B-3
"Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange
Act, as such Rule may be amended in the future.
SECTION 1.15 - SECRETARY
"Secretary" shall mean the Secretary of the Company.
SECTION 1.16 - SECURITIES ACT
"Securities Act" shall mean the Securities Act of 1933, as amended.
SECTION 1.17 - SUBSIDIARY
"Subsidiary" shall mean any corporation in an unbroken chain of
corporations beginning with the Company if each of the corporations other than
the last corporation in the unbroken chain then owns stock possessing 50% or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
B - 2
30
SECTION 1.18 - TERMINATION OF EMPLOYMENT
"Termination of Employment" shall mean the time when the
employee-employer relationship between the Optionee and the Company or a
Subsidiary is terminated for any reason, with or without cause, including, but
not by way of limitation, a termination by resignation, discharge, death or
retirement, but excluding terminations where there is a simultaneous
reemployment by the Company or a Subsidiary. The Committee, in its absolute
discretion, shall determine the effect of all other matters and questions
relating to Termination of Employment, including, but not by way of limitation,
the question of whether a Termination of Employment resulted from a discharge
for good cause, and all questions of whether particular leaves of absence
constitute Terminations of Employment; provided, however, that, with respect to
Incentive Stock Options, a leave of absence shall constitute a Termination of
Employment if, and to the extent that, such leave of absence interrupts
employment for the purposes of Section 422(a)(2) of the Code and the then
applicable regulations and revenue rulings under said Section.
ARTICLE II
SHARES SUBJECT TO PLAN
SECTION 2.1 - SHARES SUBJECT TO PLAN
The shares of stock subject to Options shall be shares of the
Company's $0.01 par value Common Stock. The aggregate number of such shares
which may be issued upon exercise of Options shall not exceed 1,450,000.
SECTION 2.2 - UNEXERCISED OPTIONS
If any Option expires or is cancelled without having been fully
exercised, the number of shares subject to such Option but as to which such
Option was not exercised prior to its expiration or cancellation may again be
optioned hereunder, subject to the limitations of Section 2.1.
SECTION 2.3 - CHANGES IN COMPANY'S SHARES
In the event that the outstanding shares of Common Stock of the
Company are hereafter changed into or exchanged for a different number or kind
of shares or other securities of the Company, or of another corporation, by
reason of reorganization, merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend or combination of shares,
appropriate adjustments shall be made by the Committee in the number and kind
of shares for the purchase of which Options may be granted, including
adjustments of the limitations in Section 2.1 on the maximum number and kind of
shares which may be issued on exercise of Options.
ARTICLE III
GRANTING OF OPTIONS
SECTION 3.1 - ELIGIBILITY
Any executive or other key Employee of the Company or of any
corporation which is then a Subsidiary shall be eligible to be granted Options,
except as provided in Section 3.2.
SECTION 3.2 - QUALIFICATION OF INCENTIVE STOCK OPTIONS
No Incentive Stock Option shall be granted unless such Option, when
granted, qualifies as an "incentive stock option" under Section 422 of the
Code.
SECTION 3.3 - GRANTING OF OPTIONS
(a) The Committee shall from time to time, in its absolute
discretion:
(1) Determine which Employees are executive or other key
Employees and select from among the executive or other key Employees
(including those to whom Options have been previously granted under
the Plan) such of them as in its opinion should be granted Options;
and
B - 3
31
(2) Determine the number of shares to be subject to such
Options granted to such selected executive or other key Employees, and
determine whether such Options are to be Incentive Stock Options or
Non-Qualified Options; and
(3) Determine the terms and conditions of such Options,
consistent with the Plan.
(b) Upon the selection of an executive or other key Employee to be
granted an Option, the Committee shall instruct the Secretary to issue such
Option and may impose such conditions on the grant of such Option as it deems
appropriate. Without limiting the generality of the preceding sentence, the
Committee may, in its discretion and on such terms as it deems appropriate,
require as a condition on the grant of an Option to an Employee that the
Employee surrender for cancellation some or all of the unexercised Options
which have been previously granted to him. An Option the grant of which is
conditioned upon such surrender may have an option price lower (or higher) than
the option price of the surrendered Option, may cover the same (or a lesser or
greater) number of shares as the surrendered Option, may contain such other
terms as the Committee deems appropriate and shall be exercisable in accordance
with its terms, without regard to the number of shares, price, option period or
any other term or condition of the surrendered Option.
ARTICLE IV
TERMS OF OPTIONS
SECTION 4.1 - OPTION AGREEMENT
Each Option shall be evidenced by a written Stock Option Agreement,
which shall be executed by the Optionee and an authorized Officer of the
Company and which shall contain such terms and conditions as the Committee
shall determine, consistent with the Plan. Stock Option Agreements evidencing
Incentive Stock Options shall contain such terms and conditions as may be
necessary to qualify such Options as "incentive stock options" under Section
422 of the Code.
SECTION 4.2 - OPTION PRICE
(a) The price of the shares subject to each Option shall be set by
the Committee; provided, however, that the price per share shall be not less
than 100% of the fair market value of such shares on the date such Option is
granted; provided, further, that, in the case of an Incentive Stock Option, the
price per share shall not be less than 110% of the fair market value of such
shares on the date such Option is granted in the case of an individual then
owning (within the meaning of Section 424(d) of the Code) more than 10% of the
total combined voting power of all classes of stock of the Company, any
Subsidiary or any parent corporation.
(b) For purposes of the Plan, the fair market value of a share of
the Company's Common Stock as of a given date shall be: (i) the closing price
of a share of the Company's Common Stock on the principal exchange on which
shares of the Company's Common Stock are then trading, if any, on the trading
day previous to such date, or, if shares were not traded on the day previous to
such date, then on the next preceding trading day during which a sale occurred;
or (ii) if such Common Stock is not traded on an exchange but is quoted on
NASDAQ or a successor quotation system, (1) the last sales price (if the
Company's Common Stock is then listed as a National Market Issue under the NASD
National Market System) or (2) the mean between the closing representative bid
and asked prices (in all other cases) for the Company's Common Stock on the
trading day previous to such date as reported by NASDAQ or such successor
quotation system; or (iii) if such Common Stock is not publicly traded on an
exchange and not quoted on NASDAQ or a successor quotation system, the mean
between the closing bid and asked prices for the Company's Common Stock, on the
trading day previous to such date, as determined in good faith by the
Committee; or (iv) if the Company's Common Stock is not publicly traded, the
fair market value established by the Committee acting in good faith.
SECTION 4.3 - COMMENCEMENT OF EXERCISABILITY
(a) Except as the Committee may otherwise provide with respect to
Options granted to Employees who are not Officers, no Option may be exercised
in whole or in part during the first six months after such Option is granted.
B - 4
32
(b) Subject to the provisions of Sections 4.3(a), 4.3(c) and 7.3,
Options shall become exercisable at such times and in such installments (which
may be cumulative) as the Committee shall provide in the terms of each
individual Option; provided, however, that by a resolution adopted after an
Option is granted the Committee may, on such terms and conditions as it may
determine to be appropriate and subject to Sections 4.3(a), 4.3(c) and 7.3,
accelerate the time at which such Option or any portion thereof may be
exercised.
(c) No portion of an Option which is unexercisable at Termination
of Employment shall thereafter become exercisable.
(d) To the extent that the aggregate fair market value of stock
with respect to which "incentive stock options" (within the meaning of Section
422 of the Code, but without regard to Section 422(d) of the Code) are
exercisable for the first time by an Optionee during any calendar year (under
the Plan and all other incentive stock option plans of the Company, any
Subsidiary and any parent corporation) exceeds $100,000, such options shall be
taxed as Non-Qualified Options. The rule set forth in the preceding sentence
shall be applied by taking options into account in the order in which they were
granted. For purposes of this Section 4.3(d), the fair market value of stock
shall be determined as of the time the option with respect to such stock is
granted.
SECTION 4.4 - EXPIRATION OF OPTIONS
(a) No Option may be exercised to any extent by anyone after the
first to occur of the following events:
(1) The expiration of ten years from the date the Option
was granted; or
(2) With respect to an Incentive Stock Option in the case
of an Optionee owning (within the meaning of Section 424(d) of the
Code), at the time the Incentive Stock Option was granted, more than
10% of the total combined voting power of all classes of stock of the
Company, any Subsidiary or any parent corporation, the expiration of
five years from the date the Incentive Stock Option was granted; or
(3) Except in the case of any Optionee who is disabled
(within the meaning of Section 22(e)(3) of the Code), the expiration
of three months from the date of the Optionee's Termination of
Employment for any reason other than such Optionee's death unless the
Optionee dies within said three-month period; or
(4) In the case of an Optionee who is disabled (within
the meaning of Section 22(e)(3) of the Code), the expiration of one
year from the date of the Optionee's Termination of Employment for any
reason other than such Optionee's death unless the Optionee dies
within said one-year period; or
(5) The expiration of one year from the date of the
Optionee's death.
(b) Subject to the provisions of Section 4.4(a), the Committee
shall provide, in the terms of each individual Option, when such Option expires
and becomes unexercisable; and (without limiting the generality of the
foregoing) the Committee may provide in the terms of individual Options that
said Options expire immediately upon a Termination of Employment for any
reason.
SECTION 4.5 - CONSIDERATION
In consideration of the granting of an Option, the Optionee shall
agree, in the written Stock Option Agreement, to remain in the employ of the
Company or a Subsidiary for a period of at least one year after the Option is
granted. Nothing in this Plan or in any Stock Option Agreement hereunder shall
confer upon any Optionee any right to continue in the employ of the Company or
any Subsidiary or shall interfere with or restrict in any way the rights of the
Company and its Subsidiaries, which are hereby expressly reserved, to discharge
any Optionee at any time for any reason whatsoever, with or without cause.
B - 5
33
SECTION 4.6 - ADJUSTMENTS IN OUTSTANDING OPTIONS
In the event that the outstanding shares of the stock subject to
Options are changed into or exchanged for a different number or kind of shares
of the Company or other securities of the Company by reason of merger,
consolidation, recapitalization, reclassification, stock split-up, stock
dividend or combination of shares, the Committee shall make an appropriate and
equitable adjustment in the number and kind of shares as to which all
outstanding Options, or portions thereof then unexercised, shall be
exercisable, to the end that after such event the Optionee's proportionate
interest shall be maintained as before the occurrence of such event. Such
adjustment in an outstanding Option shall be made without change in the total
price applicable to the Option or the unexercised portion of the Option (except
for any change in the aggregate price resulting from rounding-off of share
quantities or prices) and with any necessary corresponding adjustment in Option
price per share; provided, however, that, in the case of Incentive Stock
Options, each such adjustment shall be made in such manner as not to constitute
a "modification" within the meaning of Section 424(h)(3) of the Code. Any such
adjustment made by the Committee shall be final and binding upon all Optionees,
the Company and all other interested persons.
SECTION 4.7 - MERGER, CONSOLIDATION, ACQUISITION, LIQUIDATION OR DISSOLUTION
Notwithstanding the provisions of Section 4.6, in its absolute
discretion, and on such terms and conditions as it deems appropriate, the
Committee may provide by the terms of any Option that such Option cannot be
exercised after the merger or consolidation of the Company with or into another
corporation, the acquisition by another corporation or person of all or
substantially all of the Company's assets or 80% or more of the Company's then
outstanding voting stock or the liquidation or dissolution of the Company; and
if the Committee so provides, it may, in its absolute discretion and on such
terms and conditions as it deems appropriate, also provide, either by the terms
of such Option or by a resolution adopted prior to the occurrence of such
merger, consolidation, acquisition, liquidation or dissolution, that, for some
period of time prior to such event, such Option shall be exercisable as to all
shares covered thereby, notwithstanding anything to the contrary in Section
4.3(a), Section 4.3(b) and/or any installment provisions of such Option.
ARTICLE V
EXERCISE OF OPTIONS
SECTION 5.1 - PERSON ELIGIBLE TO EXERCISE
During the lifetime of the Optionee, only he may exercise an Option
(or any portion thereof) granted to him. After the death of the Optionee, any
exercisable portion of an Option may, prior to the time when such portion
becomes unexercisable under the Plan or the applicable Stock Option Agreement,
be exercised by his personal representative or by any person empowered to do so
under the deceased Optionee's will or under the then applicable laws of descent
and distribution.
SECTION 5.2 - PARTIAL EXERCISE
At any time and from time to time prior to the time when any
exercisable Option or exercisable portion thereof becomes unexercisable under
the Plan or the applicable Stock Option Agreement, such Option or portion
thereof may be exercised in whole or in part; provided, however, that the
Company shall not be required to issue fractional shares and the Committee may,
by the terms of the Option, require any partial exercise to be with respect to
a specified minimum number of shares.
SECTION 5.3 - MANNER OF EXERCISE
An exercisable Option, or any exercisable portion thereof, may be
exercised solely by delivery to the Secretary or his office of all of the
following prior to the time when such Option or such portion becomes
unexercisable under the Plan or the applicable Stock Option Agreement:
(a) Notice in writing signed by the Optionee or other
person then entitled to exercise such Option or portion, stating that
such Option or portion is exercised, such notice complying with all
applicable rules established by the Committee; and
B - 6
34
(b) (1) Full payment (in cash or by check) for
the shares with respect to which such Option or portion is
thereby exercised; or
(2) With the consent of the Committee, but
subject to the timing requirements of Section 5.4, (A) shares
of the Company's Common Stock owned by the Optionee duly
endorsed for transfer to the Company or (B) shares of the
Company's Common Stock issuable to the Optionee upon exercise
of the Option, with a fair market value (as determined under
Section 4.2(b)) on the date of Option exercise equal to the
aggregate Option price of the shares with respect to which
such Option or portion is thereby exercised; or
(3) With the consent of the Committee, a full
recourse promissory note bearing interest (at no less than
such rate as shall then preclude the imputation of interest
under the Code or any successor provision) and payable upon
such terms as may be prescribed by the Committee. The
Committee may also prescribe the form of such note and the
security to be given for such note. No Option may, however,
be exercised by delivery of a promissory note or by a loan
from the Company when or where such loan or other extension of
credit is prohibited by law; or
(4) With the consent of the Committee, any
combination of the consideration provided in the foregoing
subsections (1), (2) and (3); and
(c) The payment to the Company (or other employer
corporation) of all amounts which it is required to withhold under
federal, state or local law in connection with the exercise of the
Option; with the consent of the Committee, but subject to the timing
requirements of Section 5.4, (i) shares of the Company's Common Stock
owned by the Optionee duly endorsed for transfer or (ii) shares of the
Company's Common Stock issuable to the Optionee upon exercise of the
Option, valued in accordance with Section 4.2(b) at the date of Option
exercise, may be used to make all or part of such payment;
(d) Such representations and documents as the Committee,
in its absolute discretion, deems necessary or advisable to effect
compliance with all applicable provisions of the Securities Act and
any other federal or state securities laws or regulations. The
Committee may, in its absolute discretion, also take whatever
additional actions it deems appropriate to effect such compliance
including, without limitation, placing legends on share certificates
and issuing stop-transfer orders to transfer agents and registrars;
and
(e) In the event that the Option or portion thereof shall
be exercised pursuant to Section 5.1 by any person or persons other
than the Optionee, appropriate proof of the right of such person or
persons to exercise the Option or portion thereof.
SECTION 5.4 - CERTAIN TIMING REQUIREMENTS
Shares of the Company's Common Stock, whether or not issuable to the
Optionee upon exercise of the Option, may be used to satisfy the Option price
or the tax withholding consequences of such exercise only (i) during the period
beginning on the third business day following the date of release of the
quarterly or annual summary statement of sales and earnings of the Company and
ending on the twelfth business day following such date or (ii) pursuant to an
irrevocable written election by the Optionee to use shares of the Company's
Common Stock to pay all or part of the Option price or the withholding taxes
(subject to the approval of the Committee) made at least six months prior to
the payment of such Option price or withholding taxes.
SECTION 5.5 - CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES
The shares of the Company's Common Stock issuable and deliverable upon
the exercise of an Option, or any portion thereof, may be either previously
authorized but unissued shares or issued shares which have then been reacquired
by the Company. The Company shall not be required to issue or deliver any
certificate or
B - 7
35
certificates for shares of stock purchased upon the exercise of any Option or
portion thereof prior to fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock
exchanges on which such series or class of stock is then listed; and
(b) The completion of any registration or other
qualification of such shares under any state or federal law or under
the rulings or regulations of the Securities and Exchange Commission
or any other governmental regulatory body, which the Committee shall,
in its absolute discretion, deem necessary or advisable; and
(c) The obtaining of any approval or other clearance from
any state or federal governmental agency which the Committee shall, in
its absolute discretion, determine to be necessary or advisable; and
(d) The payment to the Company (or other employer
corporation) of all amounts which it is required to withhold under
federal, state or local law in connection with the exercise of the
Option; and
(e) The lapse of such reasonable period of time following
the exercise of the Option as the Committee may establish from time to
time for reasons of administrative convenience.
SECTION 5.6 - RIGHTS AS SHAREHOLDERS
The holders of Options shall not be, nor have any of the rights or
privileges of, shareholders of the Company in respect of any shares purchasable
upon the exercise of any part of an Option unless and until certificates
representing such shares have been issued by the Company to such holders.
SECTION 5.7 - TRANSFER RESTRICTIONS
Unless otherwise approved in writing by the Committee, no shares
acquired upon exercise of any Option by any Officer may be sold, assigned,
pledged, encumbered or otherwise transferred until at least six months have
elapsed from (but excluding) the date that such Option was granted. The
Committee, in its absolute discretion, may impose such other restrictions on
the transferability of the shares purchasable upon the exercise of an Option as
it deems appropriate. Any such other restriction shall be set forth in the
respective Stock Option Agreement and may be referred to on the certificates
evidencing such shares. The Committee may require the Employee to give the
Company prompt notice of any disposition of shares of stock, acquired by
exercise of an Incentive Stock Option, within two years from the date of
granting such Option or one year after the transfer of such shares to such
Employee. The Committee may direct that the certificates evidencing shares
acquired by exercise of an Incentive Stock Option refer to such requirement to
give prompt notice of disposition.
ARTICLE VI
ADMINISTRATION
SECTION 6.1 - STOCK OPTION COMMITTEE
The Stock Option Committee shall consist of two or more Directors,
appointed by and holding office at the pleasure of the Board, each of whom is
both (a) a "disinterested person" as defined by Rule 16b-3 and (b) an "outside
director" within the meaning of Section 162(m)(4)(c)(ii) of the Code.
Appointment of Committee members shall be effective upon acceptance of
appointment. Committee members may resign at any time by delivering written
notice to the Board. Vacancies in the Committee shall be filled by the Board.
SECTION 6.2 - DUTIES AND POWERS OF COMMITTEE
It shall be the duty of the Committee to conduct the general
administration of the Plan in accordance with its provisions. The Committee
shall have the power to interpret the Plan and the Options and to adopt such
rules for the administration, interpretation and application of the Plan as are
consistent therewith and to interpret, amend
B - 8
36
or revoke any such rules. Any such interpretations and rules in regard to
Incentive Stock Options shall be consistent with the basic purpose of the Plan
to grant "incentive stock options" within the meaning of Section 422 of the
Code. The Board shall have no right to exercise any of the rights or duties of
the Committee under the Plan.
SECTION 6.3 - MAJORITY RULE
The Committee shall act by a majority of its members in office. The
Committee may act either by vote at a meeting or by a memorandum or other
written instrument signed by a majority of the Committee.
SECTION 6.4 - COMPENSATION; PROFESSIONAL ASSISTANCE; GOOD FAITH ACTIONS
Members of the Committee shall receive such compensation for their
services as members as may be determined by the Board. All expenses and
liabilities incurred by members of the Committee in connection with the
administration of the Plan shall be borne by the Company. The Committee may
employ attorneys, consultants, accountants, appraisers, brokers or other
persons. The Committee, the Company and its Officers and Directors shall be
entitled to rely upon the advice, opinions or valuations of any such persons.
All actions taken and all interpretations and determinations made by the
Committee in good faith shall be final and binding upon all Optionees, the
Company and all other interested persons. No member of the Committee shall be
personally liable for any action, determination or interpretation made in good
faith with respect to the Plan or the Options, and all members of the Committee
shall be fully protected by the Company in respect to any such action,
determination or interpretation.
ARTICLE VII
OTHER PROVISIONS
SECTION 7.1 - OPTIONS NOT TRANSFERABLE
No Option or interest or right therein or part thereof shall be liable
for the debts, contracts or engagements of the Optionee or his 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 nothing in this Section 7.1
shall prevent transfers by will or by the applicable laws of descent and
distribution.
SECTION 7.2 - AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN
The Plan may be wholly or partially amended or otherwise modified,
suspended or terminated at any time or from time to time by the Committee.
However, without approval of the Company's shareholders given within 12 months
before or after the action by the Committee, no action of the Committee may,
except as provided in Section 2.3, increase any limit imposed in Section 2.1 on
the maximum number of shares which may be issued on exercise of Options,
materially modify the eligibility requirements of Section 3.1, reduce the
minimum Option price requirements of Section 4.2(a), extend the limit imposed
in this Section 7.2 on the period during which Options may be granted or amend
or modify the Plan in a manner requiring shareholder approval under Rule 16b-3.
Neither the amendment, suspension nor termination of the Plan shall, without
the consent of the holder of the Option, impair any rights or obligations under
any Option theretofore granted. No Option may be granted during any period of
suspension nor after termination of the Plan, and in no event may any Option be
granted under this Plan after the first to occur of the following events:
(a) The expiration of ten years from the date the Plan is
adopted by the Board; or
(b) The expiration of ten years from the date the Plan is
approved by the Company's shareholders under Section 7.3.
B - 9
37
SECTION 7.3 - APPROVAL OF PLAN BY SHAREHOLDERS
This Plan will be submitted for the approval of the Company's
shareholders within 12 months after the date of the Board's initial adoption of
the Plan. Options may be granted prior to such shareholder approval; provided,
however, that such Options shall not be exercisable prior to the time when the
Plan is approved by the shareholders; provided, further, that if such approval
has not been obtained at the end of said 12-month period, all Options
previously granted under the Plan shall thereupon be cancelled and become null
and void. The Company shall take such actions with respect to the Plan as may
be necessary to satisfy the requirements of Rule 16b-3(b).
SECTION 7.4 - EFFECT OF PLAN UPON OTHER OPTION AND COMPENSATION PLANS
The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for the Company or any Subsidiary. Nothing in this
Plan shall be construed to limit the right of the Company or any Subsidiary (a)
to establish any other forms of incentives or compensation for employees of the
Company or any Subsidiary or (b) to grant or assume options otherwise than
under this Plan in connection with any proper corporate purpose, including, but
not by way of limitation, the grant or assumption of options in connection with
the acquisition by purchase, lease, merger, consolidation or otherwise, of the
business, stock or assets of any corporation, firm or association.
SECTION 7.5 - TITLES
Titles are provided herein for convenience only and are not to serve
as a basis for interpretation or construction of the Plan.
SECTION 7.6 - CONFORMITY TO SECURITIES LAWS
The Plan is intended to conform to the extent necessary with all
provisions of 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 Rule 16b-3. Notwithstanding anything
herein to the contrary, the Plan shall be administered, and Options shall be
granted and may be exercised, only in such a manner as to conform to such laws,
rules and regulations. To the extent permitted by applicable law, the Plan and
Options granted hereunder shall be deemed amended to the extent necessary to
conform to such laws, rules and regulations.
B - 10
38
DETACH HERE
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
EXCEL REALTY TRUST, INC.
P 16955 VIA DEL CAMPO, SUITE 110
R SAN DIEGO, CALIFORNIA 92127
O
X The undersigned, a stockholder of Excel Realty Trust, Inc., a Maryland
Y corporation, hereby appoints Gary B. Sabin and Richard B. Muir as proxies,
each with the power to appoint his substitute, and hereby authorize them to
represent and to vote, as designated on the reverse side, all the shares of
common stock of said Company held of record by the undersigned on April 1,
1996, at the Annual Meeting of stockholders to be held on May 10, 1996, and
at any adjournment or adjournments thereof.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
-----------
SEE REVERSE
SIDE
-----------
39
DETACH HERE
[X] Please mark _____
votes as in ]
this example. ]
]
FOR AGAINST ABSTAIN
1. Election of Directors 2. Proposal to Amend the [ ] [ ] [ ]
NOMINEES: Gary B. Sabin, Directors' 1994 Stock Option
Robert E. Parsons, Jr. Plan for directors of the
and Boyd A. Lindquist Company
FOR WITHHELD 3. Proposal to amend the 1993 [ ] [ ] [ ]
[ ] [ ] Stock Option Plan for
executives and key employees
of the Company.
[ ]____________________________ 4. In their discretion, the Proxies are authorized to
For all nominees except as vote upon such other business as may properly
noted above come before the meeting.
MARK HERE
FOR ADDRESS [ ]
CHANGE AND
NOTE AT LEFT
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
Please sign exactly as name appears at left. When shares are held by
joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title
as such. If a corporation, please sign in full corporate name by
President or other authorized officer. If a partnership, please sign
in partnership name by authorized person.
Date: Signature
---------------------------------------