Exhibit 10.127
BRANDYWINE REALTY TRUST
NON-QUALIFIED OPTION
This is a Non-Qualified Stock Option Award dated January 2,
1998 (the "Award") from Brandywine Realty Trust, a Maryland real estate
investment trust (the "Company") to Gerard H. Sweeney ("Optionee"). Terms used
herein as defined terms and not defined herein have the meanings assigned to
them in the Brandywine Realty Trust 1997 Long-Term Incentive Plan, as amended
from time to time (the "Plan").
1. Definitions. As used herein:
(a) "Board" means the Board of Trustees of the
Company, as constituted from time to time.
(b) "Cause" means "Cause" as defined in the
Employment Agreement or the Plan.
(c) "Change of Control" means "Change of Control"
as defined in the Plan.
(d) "Closing" means the closing of the acquisition
and sale of the Shares as described in, and subject to the provisions of,
Paragraph 9 hereof.
(e) "Closing Date" means the date of the Closing.
(f) "Code" means the Internal Revenue Code of 1986,
as amended from time to time, and any successor thereto.
(g) "Common Share" means a common share of
beneficial interest, $.01 par value per share, of the Company.
(h) "Committee" means the Committee appointed by
the Board in accordance with Section 2 of the Plan, if one is appointed and in
existence at the time of reference. If no committee has been appointed
pursuant to Section 2, or if such a committee is not in existence at the time
of reference, "Committee" means the Board.
(i) "Date of Exercise" means the date on which the
notice required by Paragraph 6 hereof is hand-delivered, placed in the United
States mail postage prepaid, or delivered to a telegraph or telex facility.
(j) "Date of Grant" means January 2, 1998, the date
on which the Company awarded the Option.
(k) "Disability" means "Disability" as defined in
the Plan.
(l) "Employment Agreement" means the employment
agreement between Optionee and the Company, dated January 2, 1998, or any
subsequent employment agreement between Optionee and the Company as in effect
at the time of determination.
(m) "Expiration Date" means the earliest of the
following:
(i) If the Optionee terminates employment with
the Company for any reason other than
death, Disability or for Cause, 5:00 p.m.
on the date 90 days following such
termination of employment;
(ii) If the Optionee terminates employment with
the Company because of death, 5:00 p.m. on
the first anniversary of the date the
Optionee terminates employment because of
such death;
(iii) If the Optionee terminates employment with
the Company because of Disability, 5:00
p.m. on the date six months following such
termination of employment, provided that
if the Optionee dies during such period,
any Option otherwise exercisable shall be
exercisable until the first anniversary of
the Optionee's death;
(iv) If the Optionee terminates employment with
the Company for Cause, 5:00 p.m. on the
date of such termination of employment;
(v) 5:00 p.m. on the day before the tenth
anniversary of the Date of Grant.
(n) "Fair Market Value" means the Fair Market Value
of a Share, as determined pursuant to the Plan.
(o) "100% Shares" means the 296,736 Shares subject
to the Option and described in Paragraph 1(s)(i).
(p) "110% Shares" means the 347,222 Shares subject
to the Option and described in Paragraph 1(s)(ii).
(q) "115% Shares" means the 374,531 Shares subject
to the Option and described in Paragraph 1(s)(iii).
(r) "Option" means the option to purchase Shares
hereby granted.
(s) "Option Price" means:
(i) with respect to 296,736 Shares subject to
the Option, $25.25; and
(ii) with respect to 347,222 Shares subject to
the Option, $27.78; and
(iii) with respect to 374,531 Shares subject to
the Option, $29.04.
In the event of any recapitalization, Share distribution or dividend, Share
split or combination, the Option Price shall be equitably and proportionally
adjusted. The Option Price shall also be subject to adjustment pursuant to
Section 3(c) of the Plan.
(t) "Resignation for Good Reason" means
"Resignation for Good Reason" as defined in the Employment Agreement.
(u) "Shares" means the 1,018,489 Common Shares
which are the subject of the Option hereby granted. In the event of any
recapitalization, Share distribution or dividend, Share split or
combination, the number of Shares that remain subject to the Option shall be
equitably and proportionally adjusted. The number of Shares that remain
subject to the Option shall also be subject to adjustment pursuant to Section
3(c) of the Plan.
(v) "Subsidiary" means, with respect to the
Company, a subsidiary company, whether now or hereafter existing, as defined
in section 424(f) of the Code, and any other entity 50% or more of the
economic interests in which are owned, directly or indirectly, by the Company.
2. Grant of Option. Subject to the terms and conditions set
forth herein and in the Plan, the Company hereby grants to the Optionee the
Option to purchase any or all of the Shares. The grant of the Option is
subject to and conditioned on the approval of such grant by the shareholders
of the Company, as described in Paragraph 4.
3. Time of Exercise of Options.
(a) Subject to Paragraph 3(b), the Option may be
exercised after such time or times as set forth below, and shall remain
exercisable until the Expiration Date, when the right to exercise shall
terminate absolutely:
(i) The Option may be exercised for twenty
percent (20%) of each of (A) the 100%
Shares, (B) the 110% shares, and (C) the
115% Shares subject to the Option
following December 31, 1998.
(ii) The Option may be exercised for an
additional twenty percent (20%) of each of
(A) the 100% Shares, (B) the 110% Shares,
and (C) the 115% Shares subject to the
Option following December 31, 1999.
(iii) The Option may be exercised for an
additional twenty percent (20%) of each of
(A) the 100% Shares, (B) the 110% Shares,
and (C) the 115% Shares subject to the
Option following December 31, 2000.
(iv) The Option may be exercised for an
additional twenty percent (20%) of each of
(A) the 100% Shares, (B) the 110% Shares,
and (C) the 115% Shares subject to the
Option following December 31, 2001.
(v) The Option may be exercised for an
additional twenty percent (20%) of each of
(A) the 100% Shares, (B) the 110% Shares,
and (C) the 115% Shares subject to the
Option following December 31, 2002.
Notwithstanding the foregoing, the number of Shares available for exercise as
determined under this Paragraph 3(a) shall be rounded down to the nearest
whole Share. No Shares subject to the Option shall first become exercisable
following the Optionee's termination of employment, except as provided in
Paragraph 3(b).
(b) Notwithstanding Paragraph 3(a), the Option
shall become fully exercisable upon the occurrence of any of the following
events:
(i) A Change of Control;
(ii) The purchase of any Common Shares pursuant
to a tender or exchange offer other than
offer by the Company;
(iii) Termination of the Optionee's employment
by the Company or an Affiliate without
Cause; or
(iv) The Optionee's Resignation for Good
Reason.
4. Contingency Upon Shareholder Approval. The grant of the
Option and all rights of the Optionee thereunder are subject to, and
conditioned on, the approval of such grant by a majority of the votes cast by
the shareholders of the Company at the shareholders' meeting next following
the Date of Grant, provided that the total votes cast on the proposal
represent over 50% of all votes entitled to be cast on the proposal In the
event the shareholders of the Company do not approve the grant of the Options
at such meeting, the Options shall be considered to represent, in lieu of
options to purchase Shares, stock appreciation rights ("SARs"), subject to the
following terms and conditions:
(a) The terms of the SARs, including but not
limited to restrictions on vesting and exercise and the manner of exercise,
will be generally the same as the terms of the Option granted in this Award,
but, upon the exercise thereof, Optionee shall not be required to tender any
payment, and the Company, rather than issuing Shares, shall pay to the
Optionee a cash amount equal to the product of (x) the number of Shares with
respect to which the SAR is then deemed to be exercised, multiplied by (y) the
excess of the Fair Market Value of a Share as of the day before the Date of
Exercise over the applicable Option Price for such Share.
(b) Payment by the Company to the Optionee upon the
exercise of an SAR shall be subject to the Company's or Affiliate's right to
withhold in accordance with applicable law, any taxes required to be withheld
under federal, state or local law as a result of the exercise of the SAR in
accordance with Paragraph 14.
5. Payment for Shares. Full payment for Shares purchased
upon the exercise of an Option shall be made in cash or, at the election of
the Optionee and as the Committee may, in its sole discretion, approve, by
surrendering Common Shares with an aggregate Fair Market Value equal to the
aggregate Option Price, or by delivering such combination of Common Shares and
cash as the Committee may, in its sole discretion, approve.
6. Manner of Exercise. The Option shall be exercised by
giving written notice of exercise to:
Brandywine Realty Trust
16 Campus Boulevard
Suite 150
Newtown Square, PA 19073
Attention: Chief Financial Officer
All notices under this agreement shall be deemed to have been given when
hand-delivered, telecopied or mailed, first class postage prepaid, and shall
be irrevocable once given.
7. Nontransferability of Option. The Option may not be
transferred or assigned by the Optionee otherwise than as and to the extent
permitted by Section 5(e) of the Plan; and any attempt at assignment or
transfer contrary to the provisions of the Plan or the levy of any execution,
attachment or similar process upon the Option shall be null and void and
without effect. Any exercise of the Option by a person other than the Optionee
shall be accompanied by appropriate proofs of the right of such person to
exercise the Option.
8. Securities Laws. The Committee may from time to time
impose any conditions on the exercise of the Option as it deems necessary or
appropriate to comply with the then-existing requirements of the Securities
Act of 1933, as amended, or of the Securities Exchange Act of 1934, as
amended, including Rule 16b-3 (or any similar rule) of the Securities and
Exchange Commission. If the listing, registration or qualification of Shares
issuable on the exercise of the Option upon any securities exchange or under
any federal or state law, or the consent or approval of any governmental
regulatory body is necessary as a condition of or in connection with the
purchase of such Shares, the Company shall not be obligated to issue or
deliver the certificates representing the Shares otherwise issuable on the
exercise of the Option unless and until such listing, registration,
qualification, consent or approval shall have been effected or obtained. If
registration is considered unnecessary by the Company or its counsel, the
Company may cause a legend to be placed on such Shares calling attention to
the fact that they have been acquired for investment and have not been
registered.
9. Issuance of Certificate at Closing; Payment of Cash.
Subject to the provisions of this Paragraph 9, the Closing Date shall occur as
promptly as is feasible after the exercise of the Option. Subject to the
provisions of Paragraphs 8 and 10 hereof, a certificate for the Shares
issuable on the exercise of the Option shall be delivered to the Optionee or
to his personal representative, heir or legatee at the Closing, provided that
no certificates for Shares will be delivered to the Optionee or to his
personal representative, heir or legatee unless the Option Price has been paid
in full.
10. Rights Prior to Exercise. The Optionee shall not have
any right as a shareholder with respect to any Shares subject to his Options
until the Option shall have been exercised in accordance with the terms of the
Plan and this Award and the Optionee shall have paid the full purchase price
for the number of Shares in respect of which the Option was exercised,
provided that in the event that the Optionee's employment with the Company is
terminated for Cause, upon a determination by the Committee, the Optionee
shall automatically forfeit all Shares otherwise subject to delivery upon
exercise of an Option but for which the Company has not yet delivered the
Share certificates, upon refund by the Company of the Option Price.
11. Status of Option; Interpretation. The Option is intended
to be a non-qualified stock option. Accordingly, it is intended that the
transfer of property pursuant to the exercise of the Option shall be subject
to federal income tax in accordance with section 83 of the Code. The Option is
not intended to qualify as an incentive stock option within the meaning of
section 422 of the Code. The interpretation and construction of any provision
of this Option or the Plan made by the Committee shall be final and conclusive
and, insofar as possible, shall be consistent with the intention expressed in
this Paragraph 11.
12. Option Not to Affect Employment. The Option granted
hereunder shall not confer upon the Optionee any right to continue in the
employment of the Company or any Subsidiary.
13. Miscellaneous.
(a) The address for the Optionee to which notice,
demands and other communications to be given or delivered under or by reason
of the provisions hereof shall be the address contained in the Company's
personnel records.
(b) This Award and all questions relating to its
validity, interpretation, performance, and enforcement shall be governed by
and construed in accordance with the laws of the Commonwealth of Pennsylvania.
14. Withholding of Taxes. Whenever the Company proposes or
is required to deliver or transfer Shares in connection with the exercise of
the Option, or in connection with the grant or payment upon the exercise of an
SAR, the Company shall have the right to (a) require the Optionee to remit to
the Company an amount sufficient to satisfy any federal, state and/or local
withholding tax requirements prior to the delivery or transfer of any
certificate or certificates for such Shares or (b) take whatever action it
deems necessary to protect its interests with respect to tax liabilities.
IN WITNESS WHEREOF, the Company has granted this Award on the
day and year first above written.
BRANDYWINE REALTY TRUST
BY: ________________________________
TITLE:______________________________