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EXHIBIT 99.3
No. of Shares_________________ Date of Grant______________
1995 EQUITY INCENTIVE PLAN
Nonqualified Stock Option Agreement to Acquire FelCor Shares
WHEREAS, [INSERT OPTIONEE'S NAME] (the "Optionee") was issued an option
nder the Bristol Hotel Company Amended and Restated 1995 Equity Incentive Plan
("Prior Plan") prior to July 27, 1998 ("Prior Option") to acquire shares of
common stock of Bristol Hotel Company ("Prior Shares"); and
WHEREAS, this nonqualified stock option ("Option") has been issued,
effective July 28, 1998, under the second amendment and restatement of the Prior
Plan as the FelCor Lodging Trust Incorporated Second Amended and Restated 1995
Equity Incentive Plan ("Plan"), which amendment and restatement was effective
July 27, 1998 and was effected primarily to reflect and to take into account the
Spin-Off of Bristol Hotels & Resorts ("BHR"), and the Merger of Bristol Hotel
Company into FelCor Lodging Trust Incorporated (the "Corporation") (BHR or the
Corporation being sometimes referred to herein as the "Employer") and the
resulting conversion of Prior Shares into BHR Common Stock and FelCor Common
Stock; and
WHEREAS, this Option is subject to the terms and conditions of the Plan
(including, without limitation, all definitions), all of which terms and
conditions are incorporated herein by reference; and
WHEREAS, this Option is a continuation and replacement of the Prior
Option with respect to the portion of the Prior Option which related to the
acquisition of FelCor Common Stock and, to that extent, the Prior Option is null
and void as of July 28, 1998; and
WHEREAS, although this Option is a replacement and continuation of a
portion of the Prior Option, for convenience, and in order to simplify the
provisions of this Option, it is prepared in the form of a new option issued
under the Plan; and
WHEREAS, this Option is intended to be a nonqualified stock option.
NOW, THEREFORE, the Corporation hereby grants to the Optionee this
nonqualified stock option (the "Option") to purchase _______ shares of the
FelCor Common Stock, par value $0.01 per share ("Common Stock"), at the exercise
price of $_______ per whole share of Common Stock (the "Exercise Price"), and
agrees to cause certificates for any shares of Common Stock or fractions thereof
purchased hereunder to be delivered to the Optionee upon full payment of the
Exercise Price, subject to the terms and conditions hereinafter set forth.
1. Vesting of Option. (a) Unless terminated as hereinafter provided,
the Option will become cumulatively exercisable to the extent of 25% of the
shares of Common Stock covered thereby on _______ of 20___, 20___, 20___ and
20__, so long as the Optionee remains in the continuous full-time employ of the
Employer. For the purposes of this Agreement, the continuous
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employment of the Optionee with the Employer will not be deemed to have been
interrupted by a leave of absence specifically approved by the Board.
(b) Notwithstanding the provisions of Section 1(a) hereof, the Option
will, upon the death or disability of the Optionee, become vested and
exercisable to the extent of 1.967% of the shares of Common Stock covered
thereby for each full calendar month since the Date of Grant prior to the
Optionee's death or disability. For purposes of this Agreement, "disability"
means the Optionee's incapacity due to physical or mental illness substantially
to perform his duties on a full-time basis for six consecutive months and within
30 calendar days after a notice of termination is thereafter given by the
Employer the Optionee shall not have returned to the full-time performance of
the Optionee's duties.
(c) To the extent that the Option shall have become exercisable in
accordance with the terms of this Section 1, it may be exercised in whole or in
part from time to time thereafter and may be exercised for fractional shares of
Common Stock.
2. Payment of Exercise Price. The Exercise Price will be payable (i) in
cash in the form of currency or check or other cash equivalent acceptable to the
Corporation, (ii) by actual or constructive transfer to the Corporation of
nonforfeitable, nonrestricted shares of Common Stock that have been owned by the
Optionee for at least six months prior to the date of exercise, or (iii) by any
combination of the foregoing methods of payment. Nonforfeitable, nonrestricted
shares of Common Stock that are transferred by the Optionee in payment of all or
any part of the Exercise Price shall be valued on the basis of their fair market
value (as defined below) on the date of exercise. The requirement of payment in
cash shall be deemed satisfied if the Optionee makes arrangements satisfactory
to the Corporation with a broker that is a member of the National Association of
Securities Dealers, Inc. to sell a sufficient number of the shares of Common
Stock, which are being purchased pursuant to the exercise, so that the net
proceeds of the sale transaction will at least equal the amount of the aggregate
Exercise Price and pursuant to which the broker undertakes to deliver to the
Corporation the amount of the aggregate Exercise Price not later than the date
on which the sale transaction will settle in the ordinary course of business.
For purposes of this Agreement, fair market value as of a given date means the
greater of (A) the stated par value of the Common Stock or (B) the closing sale
price per share of Common Stock as reported on the Composite Tape of the New
York Stock Exchange on such date. If there are no transactions in shares of
Common Stock on such date, the Market Value shall be determined as of the
immediately preceding date on which there were transactions in Common Stock.
3. Termination of Option. The Option will terminate automatically and
without further notice on the earliest of the following dates:
(a) 30 calendar days after the Optionee ceases to be an employee of the
Employer for any reason other than death or disability or as described in
Section 3(b);
(b) 90 calendar days after the Optionee ceases to be an employee of the
Employer by reason of (i) termination of employment under circumstances
determined by the Board to be for the
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convenience of the Employer as communicated to the Optionee in writing, or (ii)
retirement under a retirement plan of Employer (at the time of reference) at or
after the earliest voluntary retirement age provided for in such retirement plan
or retirement at an earlier age with the consent of the Board;
(c) One year after the Optionee's death or disability if the Optionee
dies or becomes disabled (i) while in the employ of the Employer, or (ii) within
the period of 90 calendar days referred to in Section 3(b); or
(d) Ten years from the Date of Grant.
In the event that the Optionee commits an act (i) of gross misconduct as set
forth in the Employer's (at the time of reference) Employee Guidelines Manual or
related publications or announcements (collectively the "Guidelines"), or (ii)
that the Board has determined in good faith, by an affirmative vote of no less
than 75% of the Board, that the Optionee has intentionally committed an act
which is materially adverse to the Employer's (at the time of reference) or its
subsidiaries' interests (collectively the "Cause"), the Option will terminate at
the time such determination is made or, if later, upon delivery of written
notice of such determination to the Optionee, notwithstanding any other
provision of this Agreement or any other agreement or instrument to which the
Employer (at the time of reference) is a party.
4. Compliance with Law. The Corporation will make reasonable efforts to
comply with all applicable federal and state securities laws; provided, however,
notwithstanding any other provision of this Agreement, the Option will not be
exercisable if the exercise thereof would result in a violation of any such law.
5. Transferability and Exercisability. Neither the Option nor any
interest therein may be transferred by the Optionee except by will or the laws
of descent and distribution, and the Option may not be exercised during the
lifetime of the Optionee except by the Optionee or, in the event of his legal
incapacity, by his guardian or legal representative acting on behalf of the
Optionee in a fiduciary capacity under state law and court supervision.
6. Adjustments. The Board may make such adjustments in the Exercise
Price and the number or kind of shares of stock or other securities covered by
the Option that the Board determines to be required to prevent any dilution or
expansion of the Optionee's rights under this Agreement that otherwise would
result from any (a) stock dividend, stock split, combination of shares,
recapitalization or similar change in the capital structure of the Corporation,
(b) merger, consolidation, separation, reorganization or partial or complete
liquidation involving the Corporation, (c) extraordinary dividend or
distribution to holders of Common Stock or (d) other transaction or event having
an effect similar to any of foregoing. Furthermore, in the event that any
transaction or event described or referred to in the immediately preceding
sentence occurs, the Board may provide in substitution of any or all of the
Optionee's rights under this Agreement such alternative consideration as the
Board may determine to be equitable under the circumstances.
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7. Withholding Taxes. If the Employer is required to withhold any
federal, state, local or foreign tax in connection with any exercise of the
Option or other event contemplated hereby, the Optionee will pay the tax or make
provisions that are satisfactory to the Employer for the payment thereof. The
Optionee may elect to satisfy all or any part of any such withholding obligation
by surrendering to the Employer a portion of the Common Stock that is issued or
transferred to the Optionee upon the exercise of the Option, and the Common
Stock so surrendered by the Optionee will be credited against any such
withholding obligation at the fair market value of such shares on the date of
such surrender as determined by the Board; provided, however, if the Optionee is
subject to Section 16 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), such election will be subject to approval by the Board and all
of the other applicable conditions of Rule 16b-3 promulgated by the Securities
and Exchange Commission under Section 16(b) of the Exchange Act.
8. Right to Terminate Employment and to Adjust Compensation. No
provision of this Agreement will limit in any way whatsoever any right that the
Employer (at the time of reference) may otherwise have to terminate the
employment or adjust the compensation of the Optionee at any time.
9. Relation to Other Benefits. Any economic or other benefit to the
Optionee under this Agreement or the Plan will not be taken into account in
determining any benefits to which the Optionee may be entitled under any
profit-sharing, retirement or similar benefit or compensation plan maintained by
the Employer and will not affect the amount of any life insurance coverage
available to any beneficiary under any life insurance plan covering employees of
the Employer.
10. Employment with a Subsidiary. For purposes of this Agreement,
employment with any corporation, partnership, joint venture, unincorporated
association or other entity which is a subsidiary of the Employer will be deemed
to be employment with the Employer.
11. Amendment to Plan. Any amendment to the Plan will be deemed to be
an amendment to this Agreement to the extent that the amendment is applicable
hereto; provided, however, that no amendment may adversely affect the number of
shares of Common Stock to which this Option relates, the Exercise Price, the
vesting schedule hereunder or the term of the Option without the Optionee's
consent.
12. Severability. In the event that one or more of the provisions of
this Agreement is invalidated for any reason by a court of competent
jurisdiction, any provision so invalidated will be deemed to be separable from
the other provisions hereof, and the remaining provisions hereof will continue
to be valid and fully enforceable.
13. Entire Agreement. This Agreement (including any addendum hereto)
supersedes any and all other agreements, either oral or in writing, between the
parties hereto with respect to the subject matter hereof and contains all of the
covenants and agreements between the parties with respect to such subject
matter. This Agreement shall consist of this Agreement (and the Plan which is
incorporated by reference), Addendum, if any, attached hereto, and Memorandum of
Employment,
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if any, which is executed by both a duly qualified and authorized
officer of the Employer, and the Optionee.
14. Governing Law. This Agreement is made under, and will be construed
in accordance with, the laws of the State of Delaware, without giving effect to
the principles of conflict of laws of such State.
This Agreement is executed as of this ___ day of _________, 1998, to be
effective as of the Date of Grant as a replacement and continuation of the
portion of the Prior Option which, as redenominated, related to Common Stock.
FELCOR LODGING TRUST INCORPORATED,
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Thomas J. Corcoran, Jr.
President and C.E.O.
The undersigned Optionee hereby acknowledges receipt of an executed original of
this Agreement, and accepts the Option granted hereunder subject to the terms
and conditions hereinabove set forth and, without limitation, acknowledges and
agrees that the portion of the Prior Option which related to FelCor Common Stock
is null, void and of no effect as of July 28, 1998.
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[INSERT OPTIONEE'S NAME]
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