EQUITY RESIDENTIAL PROPERTIES TRUST
FOURTH AMENDED AND RESTATED
1993 SHARE OPTION AND SHARE AWARD PLAN
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(AS AMENDED MAY 14, 1998)
1. PURPOSES. The Equity Residential Properties Trust 1993 Share
Option and Share Award Plan (the "Plan") was established by Equity
Residential Properties Trust, a Maryland real estate investment trust (the
"Company"), to secure for the Company and its shareholders the benefits
arising from capital ownership by those key employees, officers, trustees and
consultants of the Company and its Subsidiaries (as defined below) who are
and will be responsible for its future growth and continued success. The
Plan is hereby amended and restated to increase the number of authorized
common shares of beneficial interest of the Company ("Shares") that may be
subject to awards and to make other changes that will help the Plan achieve
the purposes for which it was established.
The Plan will provide a means whereby such individuals may: (i) receive
Shares, subject to conditions and restrictions described herein and otherwise
determined by the Committee (defined below) ("Share Awards"); (ii) acquire
Shares pursuant to grants of options to purchase such Shares ("Options");
(iii) acquire Share Appreciation Rights ("SARs") in tandem with or
independent of Options referred to in item (ii) above; or (iv) receive
dividend equivalent rights with respect to Shares ("Dividend Equivalents").
The term "Subsidiary" means each entity the Company owns or controls directly
or indirectly either through voting control or as a general partner, provided
that, for purposes of Incentive Stock Options (as defined below) such term
shall have the meaning given in Section 424 of the Internal Revenue Code of
1986, amended (the "Code").
2. ADMINISTRATION. The authority to manage and control the operation
and administration of the Plan shall be vested in a Committee (the
"Committee") consisting of two or more members of the Board of Trustees of
the Company, each of whom is a "disinterested person" as such term is defined
in Section 16b-3(c)(2)(i) of the General Rules and Regulations promulgated
under the Securities Exchange Act of 1934 (the "Act") (except that, with
respect to grants of Options and SARs, such grant or award is made by a
Committee consisting of two or more "outside directors" as such term is
defined in Treasury Regulation Section 1.162-27(e)(3)), who shall be
appointed by, and may be removed by, such Board, provided that the Committee
shall have no authority, power or discretion to determine the number or
timing of Options granted pursuant to paragraph 3(b) below, or to alter the
terms and conditions of Options or Share Awards as set forth therein. Any
interpretation of the Plan by the Committee and any decision made by the
Committee on any other matter within its discretion is final and binding on
all persons. No member of the Committee shall be liable for any action or
determination made with respect to the Plan.
3. Participation.
(a) Generally. Subject to the terms and conditions of the Plan,
the Committee shall determine and designate from time to time the key
employees, officers and consultants of the Company and its Subsidiaries to
whom Share Awards, Options, SARs or Dividend Equivalents are to be granted
("Grantees" and individually, a "Grantee") and the number of Shares subject
to such Share Awards, Options, SARs or Dividend Equivalents to be
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granted to the Grantees. Notwithstanding the foregoing, the maximum number of
Shares with respect to which Options and SARs may be granted during any
calendar year to any Grantee is 500,000 Shares.
(b) BOARD OF TRUSTEES. An Option to purchase 5,000 Shares shall
be awarded to each member of the Board of Trustees of the Company on the date
of each meeting of the Board held immediately after each annual meeting of
the Company's shareholders. A Trustee shall become a Grantee in the Plan on
the first date on which the Trustee is awarded an Option under the Plan.
Trustees who are not members of the Committee may, in addition to Options
awarded under this paragraph, also be entitled to Options under paragraph
3(a).
(c) MANAGEMENT BY OBJECTIVES BONUS PLAN. As of a date (the "Bonus
Date") selected by the Committee that is not less than 30 days before or
after the date on which a cash distribution (a "Bonus") is earned by an
individual under the Company's Management By Objectives Bonus Plan (the "MBO
Plan"), the Committee may, in its discretion, grant each such individual a
Share Award, Option, SAR or Dividend Equivalent, or some combination thereof,
with an aggregate Grant Value (defined below), as of the Bonus Date, in an
amount equal to any portion of such Bonus (the "Award Portion") as the
Committee deems appropriate, which will be made in lieu of such portion of
the Bonus otherwise payable to such individual. All grants made pursuant to
the foregoing shall be in full satisfaction of the applicable portion of the
Award Portion, shall be made without other payment therefor, and shall be
governed by paragraph 5 hereof. If approved by the Committee, each
individual who participates in the MBO Plan will be given an opportunity to
elect to receive all or a portion of the non-Award portion of the Bonus in
one of the forms of grant described in the first sentence of this
subparagraph pursuant to procedures established by the Committee. Such
opportunity provided under this subparagraph is subject to compliance with
all applicable federal and state securities laws.
(d) VALUE. For all purposes of the Plan (i) the "Grant Value" of
grants made pursuant to paragraph 3(c) shall equal (a) for a Share Award, the
Fair Market Value of a Share (as defined below), (b) for an Option or SAR,
the difference between the Fair Market Value of a Share and the exercise or
base price of the Option or SAR, times the number of Shares subject to the
Option or SAR; and (c) for a Dividend Equivalent, the Fair Market Value of a
Share times the number of Shares subject to the Dividend Equivalent; and (ii)
the "Fair Market Value" of a Share as of any date means the closing price of
the Shares on the New York Stock Exchange on such date.
4. SHARES SUBJECT TO THE PLAN. Subject to the provisions of paragraph
13, the aggregate number of Shares for which Share Awards, Options and SARs
may be granted under the Plan shall not exceed 8,000,000 Shares. In the
event that (i) any Option granted under the Plan expires unexercised or is
terminated, surrendered or canceled (other than in connection with the
exercise of a "Tandem" (defined below) SAR) without being exercised, in whole
or in part, for any reason, or (ii) any "Non-Tandem" (defined below) SAR
granted under the Plan expires unexercised or is terminated, surrendered or
canceled without being exercised, in whole or in part, for any reason, then
the number of Shares then subject to the Option or SAR, or the unexercised,
terminated, surrendered, forfeited, canceled or reacquired portion thereof,
shall be added to the remaining number of Shares available for grant under
the Plan unless the Plan shall have terminated.
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5. SHARE AWARDS. This paragraph 5 sets forth specific terms and
conditions applicable to Share Awards under the Plan.
(a) CONDITIONS AND RESTRICTIONS. Share Awards shall be subject to
the following conditions and/or restrictions:
(i) A Share Award granted under paragraph 3(a) shall be
subject to the conditions that it is subject to a minimum vesting period of
one year from the date of grant and it will be forfeited to the Company upon
the Grantee's termination of employment with the Company within one year from
the date of grant of the Share Award ("Date of Grant'), and may be subject to
such further conditions and restrictions established by the Committee at the
Date of Grant (including conditions requiring employment by the Grantee for a
period in excess of one year).
(ii) A Share Award granted under paragraph 3(c) shall be
forfeited to the Company upon the Grantee's termination of employment with
the Company within two years from the Date of Grant, unless (A) such Grantee
has five years of service for vesting purposes under the Equity Residential
Properties Trust Advantage Retirement Plan at the time of such termination of
employment, (B) such termination of employment occurs other than
involuntarily and for "cause" (as determined by the Committee in its
discretion), and (C) within one year following such termination of
employment, the Grantee does not become employed by a competitor of the
Company.
(iii) The Committee may, but need not, establish performance
goals to be achieved within such performance periods as may be selected by it
in its sole discretion, using such measures of the performance of the Company
and/or its Subsidiaries as it may select. Performance-based Share Awards
granted other than pursuant to paragraph 3(c) will be fully vested in the
Grantee at the discretion of the Committee, but in no event earlier than upon
the one-year anniversary of the date of the grant, provided that the
Grantee's employment with the Company has not been terminated.
Non-performance-based Share Awards granted under paragraph 3(a) shall vest in
thirds, in amounts as nearly equal as possible, upon the one-, two- and
three-year anniversary of the date of the grant, provided that the Grantee's
employment with the Company has not terminated.
(iv) Notwithstanding the foregoing, the restrictions set
forth in the preceding paragraphs (i), (ii) and (iii) shall immediately lapse
such that they are of no effect in the event of the termination of a
Grantee's employment (A) because of the Grantee's "Disability" (as defined in
the Equity Residential Properties Trust Advantage Retirement Plan) or death,
(B) in connection with the Grantee's retirement at or after age 62, or (C)
upon a "Change in Control" of the Company. For purposes of this Plan, a
"Change in Control" shall be deemed to occur upon: (I) the acquisition by
any entity, person, or group of more than 50% of the outstanding Shares from
the holders thereof; (II) a merger or consolidation of the Company with one
or more other entities as a result of which the ultimate holders of
outstanding Shares immediately prior to such merger hold less than 50% of the
shares of beneficial ownership of the surviving or resulting corporation; or
(III) a transfer of substantially all of the property of the Company other
than to an entity of which the Company directly or indirectly owns at least
50% of the shares of beneficial ownership.
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(b) RIGHTS OF GRANTEE. The Grantee shall be entitled to all of
the rights of a shareholder with respect to the Share Awards including the
right to vote such Shares and to receive dividends and other distributions
payable with respect to such Shares from and after the Date of Grant;
provided that any securities or other property (but not cash) received in any
such distribution with respect to a Share Award that is still subject to the
restrictions in paragraph (a)(i), (ii) or (iii) above, shall be subject to
all of the restrictions set forth herein with respect to such Share Award.
(c) ISSUANCE. Certificates for the Share Award shall be issued in
the Grantee's name and shall be held in escrow by the Company, with stock
powers for such Shares executed in blank by the Grantee, until all
restrictions lapse or such Shares are forfeited as provided herein. A
certificate or certificates representing a Share Award as to which
restrictions have lapsed shall be delivered to the Grantee upon such lapse.
6. SHARE OPTIONS. This paragraph 6 addresses specific terms and
conditions for Share Options.
(a) ISO/NQSO. Any Option to purchase Shares granted under
paragraph 3(a) that satisfies all of the requirements of Section 422 of the
Code, may be designated by the Committee as an "Incentive Stock Option."
Options that are not so designated, or that do not satisfy the requirements
of Section 422 of the Code or that are granted under paragraph 3(b) shall not
constitute Incentive Stock Options and shall be Non-Qualified Share Options.
(b) EXERCISE PRICE. The Option price of an Incentive Stock Option
shall not be less than the Fair Market Value of a Share on the date the
Option is awarded under the Plan and, with respect to an employee who owns on
the Date of Grant more than 10% of the Company's Shares, shall not be less
than 110% of its Fair Market Value on such date. The price at which a Share
may be purchased pursuant to the exercise of any Non-Qualified Share Option
shall not be less than 100% of its Fair Market Value on the date the Option
is awarded under the Plan.
(c) EXPIRATION DATE. Subject to earlier termination as provided
in paragraph 16, the "Expiration Date" with respect to an Option or any
portion thereof granted under paragraph 3(a) means the date established by
the Committee at the Date of Grant (subject to any earlier termination by the
Committee), but in no event later than the date which is 10 years after the
date on which the Option is granted. If the employment of a Grantee who is
an employee of the Company or any of its Subsidiaries terminates for cause
(as determined by the Committee in its discretion), his Option shall expire
immediately. If such employment terminates other than for cause and other
than because of circumstances described in the last sentence of paragraph
(d)(i) below, his Option shall not thereafter become exercisable with respect
to any additional Shares, and his Option shall expire three months after the
date on which his employment terminated, but no later than the Expiration
Date. If such employment terminates because of the employee's death, his
Option shall be exercisable by the person or persons to whom that right
passes by will or by the laws of decent and distribution for a period of 12
months after the date of death (at which time it will expire), but no later
than the Expiration Date. The Expiration Date with respect to an Option or
any portion thereof granted under paragraph 3(b) means the date which is 10
years after the date on which the Option is granted. All rights to purchase
Shares pursuant to an Option shall cease as of the Option's Expiration Date.
Notwithstanding the foregoing, an Option granted
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prior to the adoption of this Second Amended and Restated Plan shall continue
to be subject to the provisions of the subsections as in effect before such
adoption.
(d) EXERCISE OF OPTIONS. The following paragraphs address
specific terms that control a Grantee's right to exercise Options:
(i) Each Option granted under paragraph 3(a) shall be
exercisable, either in whole or in part, at such time or times as shall be
determined by the Committee at the time the Option is granted or at such
earlier times as the Committee shall subsequently determine, but in no event
later than the Option's Expiration Date. The Committee may establish
performance goals to be achieved within such periods as may be selected by it
in its sole discretion, using such measures of the performance of the Company
and/or its Subsidiaries as it may select. Notwithstanding the foregoing, an
Option granted under the Plan shall be immediately exercisable in the event
of the termination of a Grantee's employment (A) because of the Grantee's
Disability or death, (B) in connection with the Grantee's retirement at or
after age 62, or (C) upon a Change in Control.
(ii) Shares with respect to which Incentive Stock Options
are exercisable for the first time by a Grantee during any calendar year may
not exceed $100,000. Any Options that become exercisable in excess of such
amount shall be deemed to be a Non-Qualified Share Option to the extent of
such excess.
(iii) Each Option granted under paragraph 3(b) shall be
exercisable, either in whole or in part, (A) with respect to 1,667 Shares at
any time on or after six months from the Date of Grant, (B) with respect to
an additional 1,667 Shares at any time on or after the first anniversary of
the Date of Grant, and (C) with respect to the remaining Shares, at any time
on or after the second anniversary of the Date of Grant, but in each case, no
later than the Option's Expiration Date.
(iv) Subject to the foregoing, a Grantee may exercise an
Option or SAR by giving written notice thereof prior to the Option's
Expiration Date to the Secretary of the Company at the principal executive
offices of the Company. Contemporaneously with the delivery of notice with
respect to exercise of an Option, the full purchase price of the Shares
purchased pursuant to the exercise of the Option, together with any required
state or federal withholding taxes, shall be paid in cash, by tender of share
certificates in proper form for transfer to the Company valued at the Fair
Market Value of the Shares on the preceding day, by any combination of the
foregoing or with any other consideration.
(e) PARTIES ENTITLED TO EXERCISE OPTIONS. An Option may be
exercised only by the Grantee (or by a legatee or legatees of such Option
under his last will), by his executors, personal representatives or
distributees, by an assignee or assignees, or by a transferee to the extent
that a transfer of the Option is permitted pursuant to paragraph 11(b).
7. SHARE APPRECIATION RIGHTS. The Committee may grant an SAR to a
Grantee who is awarded an Option under paragraph 3(a) or 3(b) or to any other
key employee, officer, trustee or consultant of the Company. Each SAR shall
be subject to such restrictions and conditions and other terms as the
Committee may specify when the SAR is granted.
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(a) GRANT. An SAR granted at the time a related Option is granted
may be granted either in addition to the related Option ("Non-Tandem SAR") or
in tandem with the related Option ("Tandem SAR"). An SAR not related to an
Option will be subject to the provisions applicable to Non-Tandem SARs. At
the time a Non-Tandem SAR is granted, the Committee shall specify the base
price of the Shares to be used in connection with the calculation described
in subsection (b)(i) below. The base price of a Non-Tandem SAR shall be a
percentage (as low as zero) of the Fair Market Value of a Share on the date
of grant. The number of Shares subject to a Tandem SAR shall not exceed one
for each Share subject to the related Option. No Tandem SAR may be granted
to a key employee in connection with an Incentive Stock Option in a manner
that will disqualify the Incentive Stock Option under Section 422 of the Code
unless the key employee consents thereto.
(b) VALUE. Upon exercise, an SAR shall entitle the Grantee to
receive from the Company the number of Shares (or cash equivalent thereof)
having an aggregate Fair Market Value equal to the following:
(i) in the case of a Non-Tandem SAR, the excess of the Fair
Market Value of one Share as of the date on which the SAR is exercised over
the base Share price specified in such SAR, multiplied by the number of
Shares then subject to the SAR, or the portion thereof being exercised.
(ii) in the case of a Tandem SAR, the excess of the Fair
Market Value of one Share as of the date on which the SAR is exercised over
the exercise price per Share specified in such Option, multiplied by the
number of Shares then subject to the Option, or the portion thereof as to
which the SAR is being exercised.
Cash shall be delivered in lieu of any fractional shares. The Committee, in
its discretion, shall be entitled to cause the Company to elect to settle any
part or all of its obligation arising out of the exercise of an SAR by the
payment of cash in lieu of all or part of the Shares it would otherwise be
obligated to deliver in an amount equal to the Fair Market Value of such
Shares on the date of exercise. So long as the Grantee is subject to Section
16(b) of the Securities Exchange Act of 1934 with respect to securities of
the Company, the Committee may not cause the Company to elect to settle any
part or all of its obligation arising out of the exercise of an SAR by the
payment of cash pursuant to this subparagraph, unless (A) such exercise
occurs no earlier than six months after the date of grant of the SAR and
during the period beginning on the third business day following the date of
release by the Company for publication of its quarterly or annual summary
statement of sales and earnings and ending on the twelfth business day
following such date, and (B) the Committee approves such form of settlement.
(c) EXERCISE OF TANDEM SARS. A Tandem SAR shall be exercisable
during such time, and be subject to such restrictions and conditions and
other terms, as the Committee shall specify at the time such Tandem SAR is
granted which restrictions and conditions and other terms need not be the
same for all Grantees. Notwithstanding the preceding sentence, the Tandem
SAR shall be exercisable only at such time as the Option to which it relates
is exercisable and shall be subject to the restrictions and conditions and
other terms applicable to such Option. Upon the exercise of a Tandem SAR,
the unexercised Option, or the portion thereof to which the exercised portion
of the Tandem SAR is related, shall expire. The exercise of any Option shall
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cause the expiration of the Tandem SAR related to such Option, or portion
thereof, that is exercised.
(d) EXERCISE OF NON-TANDEM SARS.
(i) A Non-Tandem SAR granted under the Plan shall be
exercisable during such time, and shall be subject to such restrictions and
conditions and other terms, as the Committee shall specify at the time the
Non-Tandem SAR is granted. The Committee may establish performance goals to
be achieved within such periods as may be selected by it in its sole
discretion, using such measures of the performance of the Company and/or its
Subsidiaries as it may select. Without limiting the generality of the
foregoing, the Committee may specify a minimum number of full shares with
respect to which any exercise of a Non-Tandem SAR must be made.
(ii) Subject to earlier termination as provided in the last
sentence of this paragraph, a Non-Tandem SAR granted under the Plan shall
expire on the date specified by the Committee, provided that such date shall
not be more than 10 years after the Date of Grant. The Committee shall
specify at the time each Non-Tandem SAR is granted, the time during which the
Non-Tandem SAR may be exercised prior to its expiration and other provisions
relevant to the SAR. The Committee, in its discretion, shall have the power
to accelerate the dates for exercise of any or all Non-Tandem SARs or any
part thereof, granted under the Plan. Notwithstanding the foregoing, any
Non-Tandem SAR shall expire, notwithstanding any restrictions and conditions
that the Committee may impose, following a termination of his employment with
the Company or its Subsidiaries in the same manner as an Option held by such
Grantee would expire pursuant to the provisions of paragraph 6(c).
(e) ACCELERATION. Notwithstanding any restrictions or conditions
imposed on an SAR pursuant to paragraphs (c) or (d)(i) above, an SAR granted
under the Plan shall be immediately exercisable in the event of the
termination of the Grantee's employment (A) because of the Grantee's
Disability or death, (B) in connection with the Grantee's retirement at or
after age 62, or (C) upon a Change in Control.
(f) PARTIES ENTITLED TO EXERCISE SARS. An SAR may be exercised
only by the Grantee (or by a legatee or legatees of such SAR under his last
will), by his executors, personal representatives or distributees, by an
assignee or assignees, or by a transferee to the extent that a transfer of
the SAR is permitted pursuant to paragraph 11(b).
(g) SETTLEMENT OF SARS. As soon as is reasonably practicable
after the exercise of an SAR, the Company shall (i) issue, in the name of the
Grantee, stock certificates representing the total number of full Shares to
which the Grantee is entitled pursuant to subparagraph 7(d) hereof and cash
in an amount equal to the Fair Market Value, as of the date of exercise, of
any resulting fractional Shares, and (ii) if the Committee causes the Company
to elect to settle all or part of its obligations arising out of the exercise
of the SAR in cash, deliver to the Grantee an amount in cash equal to the
Fair Market Value, as of the date of exercise, of the Shares it would
otherwise be obligated to deliver.
8. DIVIDEND EQUIVALENTS. A Dividend Equivalent shall be related to a
number of Shares specified at the time of grant and shall entitle the holder
to cash payments that equal the
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cash dividend, if any, paid with respect to such Shares provided that the
Dividend Equivalent is outstanding on the record date thereof and that it is
not subject to any condition limiting the Grantee's right to receive such
payments. A Dividend Equivalent shall be subject to such restrictions and
conditions and other terms including those relating to expiration of
forfeiture, as the Committee shall specify at the time such Dividend
Equivalent is granted. A Dividend Equivalent granted pursuant to subsection
3(c) shall not be subject to any restriction or condition limiting the
Grantee's right to receive the cash payment discussed above from and after
the second anniversary of its Date of Grant. Notwithstanding the foregoing,
any restriction or condition (other than expiration or forfeiture) limiting
the Grantee's right to receive the cash payment described above shall lapse
in the event of (A) the termination of the Grantee's employment because of
the Grantee's Disability or death, (B) the termination of the Grantee's
employment in connection with the Grantee's retirement at or after age 62, or
(C) upon a Change in Control.
9. WITHHOLDING. Whenever under the Plan a Grantee recognizes income
with respect to any Share Awards, Options, SARs or Dividend Equivalents (the
"Award") hereunder, the Company shall have the right to withhold from amounts
payable to such recipient in any manner, as necessary to satisfy all federal,
state and local payroll tax withholding requirements. Without limiting the
generality of the foregoing, (i) a Grantee may elect to satisfy all or part
of the foregoing withholding requirements by delivery of unrestricted Shares
owned by the Grantee having a Fair Market Value (determined as of the date of
such delivery by the Grantee) equal to the amount to be so withheld; and (ii)
the Committee may permit any such delivery to be made by withholding Shares
otherwise issuable pursuant to the award giving rise to the tax withholding
obligation (in which event the date of delivery shall be deemed the date such
award was exercised). If Shares are being surrendered by or withheld for a
Grantee who is subject to Section 16 of the Act, the foregoing shall be
accomplished in a manner consistent with Rule 16b-3(e) thereunder.
10. COMPLIANCE WITH APPLICABLE LAWS. Notwithstanding any other
provision in the Plan, the Company shall have no liability to issue any
Shares under the Plan unless such issuance would comply with all applicable
laws and applicable requirements of any securities exchange or similar
entity. Prior to the issuance of any Shares under the Plan, the Company may
require a written statement that the recipient is acquiring the Shares for
investment and not for the purpose of with the intention of distributing the
Shares.
11. TRANSFERABILITY. This paragraph 11 shall govern the
transferability of the various benefits under this Plan.
(a) SHARE AWARDS. The Shares subject to Share Awards granted
under paragraph 3(a) or 3(c) shall not be sold, assigned, pledged or
otherwise transferred, voluntarily or involuntarily, by the Grantee, while
they are subject to the restrictions described in paragraph 5(a).
(b) OPTIONS, SARS AND DIVIDEND EQUIVALENTS. Options, SARs and
Dividend Equivalents granted under the Plan are not transferable except (i)
by will or by the laws of descent and distribution or, to the extent not
inconsistent with the applicable provisions of the Code, pursuant to a
qualified domestic relations order (as that term is defined in the Code); and
(ii) a Grantee may transfer all or part of an Option that is not an Incentive
Stock Option, or an SAR, to the Grantee's spouse, child or children,
grandchild or grandchildren, or other relatives or to a trust for the benefit
of the Grantee and/or any of the foregoing; provided that the transferee
thereof
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shall hold such Option or SAR subject to all of the conditions and
restrictions contained herein and otherwise applicable to the Option or SAR,
and that, as a condition to such transfer, the Company may require the
transferee to agree in writing (in a form acceptable to the Company) that the
transfer is subject to such conditions and restrictions. Except as provided
in paragraphs 6(e) and 7(f), Options and SARs may be exercised during the
lifetime of the Grantee only by the Grantee or the Grantee's transferees as
provided in this paragraph, and after the death of the Grantee, only as
provided herein.
12. EMPLOYMENT AND SHAREHOLDER STATUS. The Plan does not constitute a
contract of employment or continued service, and selection as a Grantee will
not give any employee or Grantee the right to be retained in the employ of
the Company or any Subsidiary or the right to continue as a trustee of the
Company. Any Option or a Share Award granted under the Plan shall not confer
upon the holder thereof any right as a shareholder of the Company prior to
the issuance of Shares pursuant to the exercise thereof. No person entitled
to exercise any Option or SAR granted under the Plan shall have any of the
rights or privileges of a shareholder of record with respect to any Shares
issuable upon exercise of such Option or SAR until certificates representing
such Shares have been issued and delivered. If the redistribution of Shares
is restricted pursuant to paragraph 13, certificates representing such Shares
may bear a legend referring to such restrictions.
13. ADJUSTMENTS TO NUMBER OF SHARES SUBJECT TO THE PLAN AND TO TERMS OF
OPTIONS, SARS AND DIVIDEND EQUIVALENTS. Subject to the following provisions
of this paragraph 13, in the event of any change in the outstanding Shares by
reason of any share dividend, split, recapitalization, merger, consolidation,
combination, exchange of shares or other similar corporate change, the
aggregate number and kind of Shares reserved for issuance under the Plan or
subject to Options, SARs or Dividend Equivalents outstanding or to be granted
under the Plan shall be proportionately adjusted so that the value of each
such unit shall not be changed, and the terms of any outstanding Option, SAR
or Dividend Equivalent may be adjusted by the Committee in such manner as it
deems equitable, provided that in no event shall the Option price for a Share
be adjusted below the par value of such Share, nor shall any fraction of a
Share be issued upon the exercise of an Option. Shares subject to a Share
Award shall be treated in the same manner as other outstanding Shares;
provided that any conditions and restrictions applicable to a Share Award
shall continue to apply to any Shares, other security or other consideration
received in connection with the foregoing.
14. AGREEMENT WITH COMPANY. At the time of a grant, the Committee may
require a Grantee to enter into an agreement with the Company in a form
specified by the Committee agreeing to the terms and conditions of the Plan
and to such additional terms and conditions, not inconsistent with the Plan,
as the Committee may, in its sole discretion, prescribe.
15. TERM OF PLAN. The Plan was effective May 21, 1993. This amendment
and restatement is effective as of May 14, 1998. No Options, Share Awards or
Share Appreciation Rights may be granted under the Plan after May 21, 2003
or, if earlier, the date on which the Plan is terminated pursuant to
paragraph 16.
16. AMENDMENT AND TERMINATION OF PLAN. Subject to any approval of the
shareholders of the Company which may be required by law, the Board of
Trustees of the Company may at any time amend, suspend or terminate the Plan,
provided that the number of timing of Options granted
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pursuant to paragraph 3(b) and the terms and conditions of such Options may
not be amended more frequently than once in any six (6) month period except
to comply with changes in the Code, the Employee Retirement Income Security
Act of 1974, as amended, or the rules thereunder. No amendment, suspension
or termination of the Plan shall alter or impair any Share Award, Option, SAR
or Dividend Equivalent previously granted under the Plan without the consent
of the holder thereof. No amendment requiring shareholder approval under
Section 240.16b-3 of the Act, Treasury Regulation Section 1.162-27 or Section
422 of the Code shall be valid unless such shareholder approval is secured as
provided therein.
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