Exhibit 10.1
RECKSON ASSOCIATES REALTY CORP.
2005 STOCK OPTION PLAN
ARTICLE 1. GENERAL
1.1. Purpose. The purpose of the Reckson Associates Realty Corp. 2005
Stock Option Plan (the "Plan") is to provide for certain officers, directors and
employees of Reckson Associates Realty Corp. (the "Company") and certain of its
Affiliates (as defined below) an equity-based incentive to maintain and enhance
the performance and profitability of the Company. It is the further purpose of
this Plan to permit the granting of awards that will constitute performance
based compensation for certain executive officers, as described in Section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), and
regulations promulgated thereunder.
1.2. Administration.
(a) The Plan shall be administered by the Compensation Committee (the
"Committee") of the Board of Directors of the Company (the "Board"), which
Committee shall consist of two or more directors, or by the Board. It is
intended that the directors appointed to serve on the Committee shall be
"non-employee directors" (within the meaning of Rule 16b-3 promulgated under the
Securities Exchange Act of 1934 (the "Act")), "outside directors" (within the
meaning of Code Section 162(m)) and "independent directors" (within the meaning
of Section 303A of the Listed Company Manual of the New York Stock Exchange,
Inc.); however, the mere fact that a Committee member shall fail to qualify
under any of these requirements shall not invalidate any award made by the
Committee which award is otherwise validly made under the Plan. The members of
the Committee shall be appointed by, and may be changed at any time and from
time to time in the discretion of, the Board.
(b) The Committee shall have the authority (i) to exercise all of the
powers granted to it under the Plan, (ii) to construe, interpret and implement
the Plan and any Plan Agreements (as defined below) executed pursuant to the
Plan, (iii) to prescribe, amend and rescind rules relating to the Plan, (iv) to
make any determination necessary or advisable in administering the Plan, (v) to
correct any defect, supply any omission and reconcile any inconsistency in the
Plan and (vi) to delegate to the Company's Chief Executive Officer (the "Proper
Officer") its authority to grant awards under the Plan to employees, excluding
those employees who are executive officers ("Non-Executive Officers"), provided
that (a) the aggregate number of shares of Common Stock and/or OP Units granted
to any Non-Executive Officer during any calendar year shall not exceed an
aggregate of 100,000 shares and/or units and (b) the Proper Officer shall report
annually to the Committee regarding the material terms of awards granted to any
Non-Executive Officers.
(c) The determination of the Committee on all matters relating to the Plan
or any Plan Agreement shall be conclusive.
(d) No member of the Committee shall be liable for any action or
determination made in good faith with respect to the Plan or any award
hereunder.
(e) Notwithstanding anything to the contrary contained herein, the Board
may, in its sole discretion, at any time and from time to time, resolve to
administer the Plan, in which case, the term Committee as used herein shall be
deemed to mean the Board.
1.3. Persons Eligible for Awards. Awards under the Plan may be made to
such officers, directors and employees of the Company or its Affiliates as the
Committee shall from time to time in its sole discretion select. No member of
the Board who is not an officer or employee of the Company or an Affiliate (an
"Independent Director") shall be eligible to receive any Awards under the Plan,
except for restricted stock and/or restricted stock unit awards granted (i)
automatically or (ii) at the discretion of the Committee under the provisions of
Article 5 of the Plan.
1.4. Types of Awards Under Plan.
(a) Awards may be made under the Plan in the form of (i) stock options
("options"), (ii) restricted stock awards, (iii) unrestricted stock awards, (iv)
restricted stock unit awards and (v) LTIP Unit awards, all as more fully set
forth in Articles 2 and 3. The Committee also may grant such other awards that
are denominated or payable in, valued in whole or in part by reference to, or
otherwise based on or related to, shares of Common Stock as are deemed by the
Committee to be consistent with the purposes of the Plan. Grants made under the
Plan may also be made in lieu of cash fees otherwise payable to Directors of the
Company or cash bonuses payable to employees of the Company or any Affiliate.
(b) Options granted under the Plan may be either (i) "nonqualified" stock
options ("NQSOs") or (ii) options intended to qualify for incentive stock option
treatment described in Code Section 422 ("ISOs").
(c) All options when granted are intended to be NQSOs, unless the
applicable Plan Agreement explicitly states that the option is intended to be an
ISO. If an option is intended to be an ISO, and if for any reason such option
(or any portion thereof) shall not qualify as an ISO, then, to the extent of
such nonqualification, such option (or portion) shall be regarded as a NQSO
appropriately granted under the Plan provided that such option (or portion)
otherwise meets the Plan's requirements relating to NQSOs.
1.5. Shares/Units Available for Awards.
(a) Subject to Section 4.5 (relating to adjustments upon changes in
capitalization), as of any date the total number of shares of Common Stock
and/or OP Units with respect to which awards may be granted under the Plan,
shall equal the excess (if any) of an aggregate of 2,000,000 shares of Common
Stock and/or OP Units, over (i) the number of shares of Common Stock and/or OP
Units subject to outstanding awards, (ii) the number of shares and/or units in
respect of which options have been exercised, grants of restricted or
unrestricted Common Stock, LTIP Units or restricted stock units have been made
pursuant to the Plan and (iii) the number of shares and/or units issued subject
to forfeiture restrictions which have lapsed. In any calendar year, a person
eligible for awards under the Plan may not be granted options under the Plan
covering a total of more than 250,000 shares of Common Stock.
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In accordance with (and without limitation upon) the preceding sentence,
awards may be granted in respect of the following shares of Common Stock and/or
OP Units: shares covered by previously-granted awards that have expired,
terminated or been cancelled for any reason whatsoever (other than by reason of
exercise or vesting).
(b) Shares of Common Stock and/or OP Units that shall be subject to
issuance pursuant to the Plan shall be authorized and unissued or treasury
shares of Common Stock or OP Units, or shares of Common Stock purchased on the
open market or from stockholders of the Company for such purpose, or OP Units
purchased from unitholders of Reckson Operating Partnership, L.P. (the
"Operating Partnership"), the Company's operating partnership, for such purpose.
1.6. Definitions of Certain Terms.
(a) The term "Affiliate" as used herein means the Operating Partnership,
Reckson FS Limited Partnership, RANY Management Group, Inc., Reckson Finance,
Inc., Reckson Management Group, Inc., Reckson Construction Group, Inc., Reckson
Construction Group New York Inc., Reckson Construction & Development, LLC,
Metropolitan Partners LLC, any person or entity that directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, the Company, or any other person or entity as subsequently
approved by the Board.
(b) The term "Cause" shall mean a finding by the Committee that the
recipient of an award under the Plan has (i) acted with gross negligence or
willful misconduct in connection with the performance of his or her material
duties to the Company or its Affiliates; (ii) defaulted in the performance of
his or her material duties to the Company or its Affiliates and has not
corrected such action within 15 days of receipt of written notice thereof; (iii)
willfully acted against the best interests of the Company or its Affiliates,
which act has had a material and adverse impact on the financial affairs of the
Company or its Affiliates; or (iv) been convicted of a felony or committed a
material act of common law fraud against the Company, its Affiliates or their
employees and such act or conviction has, or the Committee reasonably determines
will have, a material adverse effect on the interests of the Company or its
Affiliates.
(c) The term "Common Stock" as used herein means the shares of common
stock of the Company as constituted on the effective date of the Plan, and any
other shares into which such common stock shall thereafter be changed by reason
of a recapitalization, merger, consolidation, split up, combination, exchange of
shares or the like.
(d) The "fair market value" (or "FMV") as of any date and in respect of
any share of Common Stock shall be:
(i) if the Common Stock is listed for trading on the New York Stock
Exchange, the closing price, regular way, of the Common Stock as
reported on the New York Stock Exchange Composite Tape, or if no such
reported sale of the Common Stock shall have occurred on such date, on
the next preceding date on which there was such a reported sale; or
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(ii) if the Common Stock is not so listed but is listed on another
national securities exchange or authorized for quotation on the
National Association of Securities Dealers Inc.'s NASDAQ National
Market System ("NASDAQ/NMS"), the closing price, regular way, of the
Common Stock on such exchange or NASDAQ/NMS, as the case may be, on
which the largest number of shares of Common Stock have been traded in
the aggregate on the preceding twenty trading days, or if no such
reported sale of the Common Stock shall have occurred on such date on
such exchange or NASDAQ/NMS, as the case may be, on the preceding date
on which there was such a reported sale on such exchange or
NASDAQ/NMS, as the case may be; or
(iii) if the Common Stock is not listed for trading on a national
securities exchange or authorized for quotation on NASDAQ/NMS, the
average of the closing bid and asked prices as reported by the
National Association of Securities Dealers Automated Quotation System
("NASDAQ") or, if no such prices shall have been so reported for such
date, on the next preceding date for which such prices were so
reported.
(e) The term "LTIP Unit" shall mean an OP Unit, granted to a grantee
pursuant to Article 3, that is subject to the restrictions set forth in such
Article.
(f) The term "OP Unit" shall mean a unit of partnership interest in the
Operating Partnership.
(a) The term "Restricted Period" shall mean, in relation to shares of
restricted stock, restricted stock units, LTIP Units or Common Stock received
upon the exercise of options, the period determined by the Committee, during
which restrictions on the transferability of such shares of restricted stock,
restricted stock units, LTIP Units or Common Stock received upon the exercise of
options are in effect.
(g) The term "restricted stock unit" shall mean a right, granted to a
grantee pursuant to Article 3, to receive either (i) an amount in cash equal to
the FMV of one share of Common Stock or (ii) one share of Common Stock, as
provided by the Committee at the time of grant.
1.7. Agreements Evidencing Awards.
(a) Option, restricted stock, LTIP Unit and restricted stock unit awards
granted under the Plan shall be evidenced by written agreements. Any such
written agreements shall (i) contain such provisions not inconsistent with the
terms of the Plan as the Committee may in its sole discretion deem necessary or
desirable and (ii) be referred to herein as "Plan Agreements."
(b) Each Plan Agreement shall set forth the number of shares of Common
Stock or OP Units, as applicable, subject to the award granted thereby.
(c) Each Plan Agreement with respect to the granting of an option shall
set forth the amount (the "option exercise price") payable by the grantee to the
Company in connection with the exercise of the option evidenced thereby. The
option exercise price per share shall not be less than 100% of the fair market
value of a share of Common Stock on the date the option is granted.
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ARTICLE 2. STOCK OPTIONS
2.1. Option Awards.
(a) Grant of Stock Options. The Committee may grant options to purchase
shares of Common Stock in such amounts and subject to such terms and conditions
as the Committee shall from time to time in its sole discretion determine,
subject to the terms of the Plan.
(b) Dividend Equivalent Rights. To the extent expressly provided by the
Committee at the time of the grant, each NQSO granted under this Section 2.1
shall also generate Dividend Equivalent Rights ("DERs"), which shall entitle the
grantee to receive an additional share of Common Stock for each DER received
upon the exercise of the NQSO, at no additional cost, based on the formula set
forth herein. As of the last business day of each calendar quarter, the amount
of dividends paid by the Company on each share of Common Stock with respect to
that quarter shall be divided by the FMV per share to determine the actual
number of DERs accruing on each share subject to the NQSO. Such amount of DERs
shall be multiplied by the number of shares covered by the NQSO to determine the
number of DERs which accrued during such quarter. The provisions of this Section
2.1(b) shall not be amended more than once every six months other than to
comport with changes in applicable law.
For example. Assume that a grantee holds a NQSO to purchase 600 shares of
Common Stock. Further assume that the dividend per share for the first quarter
was $0.10, and that the FMV per share on the last business day of the quarter
was $20. Therefore, .005 DER would accrue per share for that quarter and such
grantee would receive three DERs for that quarter (600 X .005). For purposes of
determining how many DERs would accrue during the second quarter, the NQSO would
be considered to be for 603 shares of Common Stock.
2.2. Exercisability of Options. Subject to the other provisions of the
Plan:
(a) Exercisability Determined by Plan Agreement. Each Plan Agreement shall
set forth the period during which and the conditions subject to which the option
shall be exercisable (including, but not limited to vesting of such options), as
determined by the Committee in its discretion.
(b) Partial Exercise Permitted. Unless the applicable Plan Agreement
otherwise provides, an option granted under the Plan may be exercised from time
to time as to all or part of the full number of shares for which such option is
then exercisable, in which event the DERs relating to the portion of the option
being exercised shall also be exercised.
(c) Notice of Exercise; Exercise Date.
(i) An option shall be exercisable by the filing of a written notice
of exercise with the Company, on such form and in such manner as the
Committee shall in its sole discretion prescribe, and by payment in
accordance with Section 2.4.
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(ii) Unless the applicable Plan Agreement otherwise provides, or the
Committee in its sole discretion otherwise determines, the date of
exercise of an option shall be the date the Company receives such
written notice of exercise and payment.
2.3. Limitation on Exercise. Notwithstanding any other provision of the
Plan, no Plan Agreement shall permit an ISO to be exercisable more than 10 years
after the date of grant.
2.4. Payment of Option Price.
(a) Tender Due Upon Notice of Exercise. Unless the applicable Plan
Agreement otherwise provides or the Committee in its sole discretion otherwise
determines, any written notice of exercise of an option shall be accompanied by
payment of the full purchase price for the shares being purchased.
(b) Manner of Payment. Payment of the option exercise price shall be made
in any combination of the following:
(i) by certified or official bank check payable to the Company (or the
equivalent thereof acceptable to the Committee);
(ii) by personal check (subject to collection), which may in the
Committee's discretion be deemed conditional;
(iii) with the consent of the Committee in its sole discretion, by
delivery of previously acquired shares of Common Stock owned by the
grantee for at least six months having a fair market value (determined
as of the option exercise date) equal to the portion of the option
exercise price being paid thereby, provided that the Committee may
require the grantee to furnish an opinion of counsel acceptable to the
Committee to the effect that such delivery would not result in the
grantee incurring any liability under Section 16(b) of the Act and
does not require any Consent (as defined in Section 4.2); and
(iv) by withholding shares of Common Stock from the shares otherwise
issuable pursuant to the exercise.
(c) Issuance of Shares. As soon as practicable after receipt of full
payment, the Company shall, subject to the provisions of Section 4.2, deliver to
the grantee one or more certificates for the shares of Common Stock so
purchased, which certificates may bear such legends as the Company may deem
appropriate concerning restrictions on the disposition of the shares in
accordance with applicable securities laws, rules and regulations or otherwise.
2.5. Default Rules Concerning Termination of Employment.
Subject to the other provisions of the Plan and unless the applicable Plan
Agreement otherwise provides:
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(a) General Rule. All options granted to a grantee shall terminate upon
the grantee's termination of employment for any reason except to the extent
post-employment exercise of the option is permitted in accordance with this
Section 2.5.
(b) Termination for Cause. All unexercised or unvested options granted to
a grantee shall terminate and expire on the day a grantee's employment is
terminated for Cause.
(c) Regular Termination; Leave of Absence. If the grantee's employment
terminates for any reason other than as provided in subsection (b), (d) or (f)
of this Section 2.5, any awards granted to such grantee which were exercisable
immediately prior to such termination of employment may be exercised, and any
awards subject to vesting may continue to vest, until the earlier of either: (i)
90 days after the grantee's termination of employment and (ii) the date on which
such options terminate or expire in accordance with the provisions of the Plan
(other than this Section 2.5) and the Plan Agreement; provided that the
Committee may, in its sole discretion, determine such other period for exercise
in the case of a grantee whose employment terminates solely because the
grantee's employer ceases to be an Affiliate or the grantee transfers employment
with the Company's consent to a purchaser of a business disposed of by the
Company. The Committee may, in its sole discretion, determine (i) whether any
leave of absence (including short-term or long-term disability or medical leave)
shall constitute a termination of employment for purposes of the Plan and (ii)
the effect, if any, of any such leave on outstanding awards under the Plan.
(d) Retirement. If a grantee's employment terminates by reason of
retirement (i.e., the voluntary termination of employment by a grantee after
attaining the age of 55), the options exercisable by the grantee immediately
prior to the grantee's retirement shall be exercisable by the grantee until the
earlier of (i) 36 months after the grantee's retirement and (ii) the date on
which such options terminate or expire in accordance with the provisions of the
Plan (other than this Section 2.5) and the Plan Agreement.
(e) Death After Termination. If a grantee's employment terminates in the
manner described in subsections (c) or (d) of this Section 2.5 and the grantee
dies within the period for exercise provided for therein, the options
exercisable by the grantee immediately prior to the grantee's death shall be
exercisable by the personal representative of the grantee's estate or by the
person to whom such options pass under the grantee's will (or, if applicable,
pursuant to the laws of descent and distribution) until the earlier of (i) 12
months after the grantee's death and (ii) the date on which such options
terminate or expire in accordance with the provisions of subsections (c) or (d)
of this Section 2.5.
(f) Death Before Termination. If a grantee dies while employed by the
Company or any Affiliate, all options granted to the grantee but not exercised
before the death of the grantee, whether or not exercisable by the grantee
before the grantee's death, shall immediately become and be exercisable by the
personal representative of the grantee's estate or by the person to whom such
options pass under the grantee's will (or, if applicable, pursuant to the laws
of descent and distribution) until the earlier of (i) 12 months after the
grantee's death and (ii) the date on which such options terminate or expire in
accordance with the provisions of the Plan (other than this Section 2.5) and the
Plan Agreement.
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2.6. Special ISO Requirements. In order for a grantee to receive special
tax treatment with respect to stock acquired under an option intended to be an
ISO, (i) the Plan must be approved by the Company's stockholders in accordance
with the requirements of Code Section 422(b) and (ii) the grantee of such option
must be, at all times during the period beginning on the date of grant and
ending on the day three months before the date of exercise of such option, an
employee of the Company or any of the Company's parent or subsidiary
corporations (within the meaning of Code Section 424), or of a corporation or a
parent or subsidiary corporation of such corporation issuing or assuming a stock
option in a transaction to which Code Section 424(a) applies. If an option
granted under the Plan is intended to be an ISO, and if the grantee, at the time
of grant, owns stock possessing more than 10% of the total combined voting power
of all classes of stock of the grantee's employer corporation or of its parent
or subsidiary corporation, then (i) the option exercise price per share shall in
no event be less than 110% of the fair market value of the Common Stock on the
date of such grant and (ii) such option shall not be exercisable after the
expiration of five years after the date such option is granted.
ARTICLE 3. RESTRICTED STOCK, UNRESTRICTED STOCK, RESTRICTED STOCK UNIT AND LTIP
UNIT AWARDS
3.1. Restricted Stock Awards.
(a) Grant of Awards. The Committee may grant restricted stock awards,
alone or in tandem with other awards, under the Plan in such amounts and subject
to such terms and conditions as the Committee shall from time to time in its
sole discretion determine; provided, however, that the grant of any such
restricted stock awards may be made in lieu of, or in tandem with, other cash
compensation and bonuses. The vesting of a restricted stock award granted under
the Plan may be conditioned upon the completion of a specified period of
employment with the Company or any Affiliate, upon the attainment of specified
performance goals, and/or upon such other criteria as the Committee may
determine in its sole discretion.
(b) Payment by Grantee. Each Plan Agreement with respect to a restricted
stock award shall set forth the amount (if any) to be paid by the grantee with
respect to such award. If a grantee makes any payment for a restricted stock
award which does not vest, appropriate payment may be made to the grantee
following the forfeiture of such award on such terms and conditions as the
Committee may determine.
(c) Forfeiture upon Termination of Employment. Unless the applicable Plan
Agreement otherwise provides or the Committee otherwise determines, (i) if a
grantee's employment terminates for any reason (including death) before all of
his or her restricted stock awards have vested, such awards shall terminate and
expire upon such termination of employment, and (ii) in the event any condition
to the vesting of restricted stock awards is not satisfied within the period of
time permitted therefor, such unvested shares shall be returned to the Company.
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(d) Issuance of Shares. The Committee may provide that one or more
certificates representing restricted stock awards shall be registered in the
grantee's name and bear an appropriate legend specifying that such shares are
not transferable and are subject to the terms and conditions of the Plan and the
applicable Plan Agreement, or that such certificate or certificates shall be
held in escrow by the Company on behalf of the grantee until such shares vest or
are forfeited, all on such terms and conditions as the Committee may determine.
Unless the applicable Plan Agreement otherwise provides, no share of restricted
stock may be assigned, transferred, otherwise encumbered or disposed of by the
grantee until such share has vested in accordance with the terms of such award
(or, if longer, until the completion of the Restricted Period). Subject to the
provisions of Section 4.2, as soon as practicable after any restricted stock
award shall vest, the Company shall issue or reissue to the grantee (or to the
grantee's designated beneficiary in the event of the grantee's death) one or
more certificates for the Common Stock represented by such restricted stock
award.
(e) Grantees' Rights Regarding Restricted Stock. Unless the applicable
Plan Agreement otherwise provides: (i) a grantee may vote and receive dividends
on restricted stock awarded under the Plan; and (ii) any stock received as a
distribution with respect to a restricted stock award shall be subject to the
same restrictions as such restricted stock.
3.2. Unrestricted Stock. The Committee may issue unrestricted stock under
the Plan, alone or in tandem with other awards, in such amounts and subject to
such terms and conditions as the Committee shall from time to time in its sole
discretion determine; provided, however, that the grant of any such unrestricted
stock awards may be made in lieu of, or in tandem with other, cash compensation
and bonuses.
3.3. Restricted Stock Unit Awards.
(a) Grant of Awards. The Committee may grant restricted stock unit awards,
alone or in tandem with other awards, under the Plan in such amounts and subject
to such terms and conditions as the Committee shall from time to time in its
sole discretion determine; provided, however, that the grant of any such
restricted stock unit awards may be made in lieu of, or in tandem with, other
cash compensation and bonuses. The vesting of a restricted stock unit award
granted under the Plan may be conditioned upon the completion of a specified
period of employment with the Company or any Affiliate, upon the attainment of
specified performance goals, and/or upon such other criteria as the Committee
may determine in its sole discretion.
(b) Payment by Grantee. Each Plan Agreement with respect to a restricted
stock unit award shall set forth the amount (if any) to be paid by the grantee
with respect to such award. If a grantee makes any payment for a restricted
stock unit award which does not vest, appropriate payment may be made to the
grantee following the forfeiture of such award on such terms and conditions as
the Committee may determine.
(c) Forfeiture upon Termination of Employment. Unless the applicable Plan
Agreement otherwise provides or the Committee otherwise determines, (i) if a
grantee's employment terminates for any reason (including death) before all of
his or her restricted stock unit awards have vested, such awards shall terminate
and expire upon such termination of employment, and (ii) in the event any
condition to the vesting of restricted stock unit awards is not satisfied within
the period of time permitted therefor, such unvested restricted stock units
shall be returned to the Company.
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(d) Dividend Equivalent Rights. To the extent expressly provided by the
Committee at the time of grant, each restricted stock unit granted under this
Section 3.3 shall also generate DERs, which shall entitle the grantee to
receive, with respect to each such restricted stock unit, a cash amount (or, if
the Committee so determines, a number of additional restricted stock units
having a value equal to the amount of such dividend payment based on the FMV per
share of a share of Common Stock on the date of such additional grant), in the
same manner, at the same time and in the same amount paid, as such dividend.
(e) Restriction on Transfer. No restricted stock unit may be assigned,
transferred, otherwise encumbered or disposed of by the grantee until such
restricted stock unit has vested in accordance with the term of the award (or,
if longer, until the completion of the Restricted Period).
(f) Payment to Grantee. Once the restricted stock units have vested (or,
if longer, following the completion of the Restricted Period), there shall be
paid to the grantee, as determined by the Committee, either (1) an amount in
cash equal to the FMV per share of one share of Common Stock for each vested
restricted stock unit measured on the last trading day of the vesting period
(or, if longer, the Restricted Period), or (2) one share of Common Stock for
each vested restricted stock unit, free of restrictions. For restricted stock
units satisfied in shares of Common Stock, the Company shall issue to the
grantee (or to the grantee's designated beneficiary in the event of the
grantee's death) one or more certificates for the appropriate number of shares
of Common Stock.
(g) Grantees' Rights Regarding Restricted Stock Units. With respect to
restricted stock units satisfied in shares of Common Stock, prior to the
settlement of the restricted stock units in shares of Common Stock pursuant to
the terms of the Plan Agreement, the grantee shall have no rights as a
stockholder of the Company with respect to such restricted stock units or such
underlying shares of Common Stock.
3.4. LTIP Unit Awards.
(a) Grant of Awards. The Committee may grant LTIP Unit awards, alone or in
tandem with other awards, under the Plan in such amounts and subject to such
terms and conditions as the Committee shall from time to time in its sole
discretion determine; provided, however, that the grant of any such LTIP Unit
awards may be made in lieu of, or in tandem with, other cash compensation and
bonuses. The vesting of an LTIP Unit award granted under the Plan may be
conditioned upon the completion of a specified period of employment with the
Company or any Affiliate, upon the attainment of specified performance goals,
and/or upon such other criteria as the Committee may determine in its sole
discretion.
(b) Payment by Grantee. Each Plan Agreement with respect to an LTIP Unit
award shall set forth the amount (if any) to be paid by the grantee with respect
to such award. If a grantee makes any payment for an LTIP Unit award which does
not vest, appropriate payment may be made to the grantee following the
forfeiture of such award on such terms and conditions as the Committee may
determine.
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(c) Forfeiture upon Termination of Employment. Unless the applicable Plan
Agreement otherwise provides or the Committee otherwise determines, (i) if a
grantee's employment terminates for any reason (including death) before all of
his or her LTIP Unit awards have vested, such awards shall terminate and expire
upon such termination of employment, and (ii) in the event any condition to the
vesting of LTIP Unit awards is not satisfied within the period of time permitted
therefor, such unvested LTIP Units shall be returned to the Company.
(d) Issuance of LTIP Units; Grantee's Rights Regarding LTIP Units. At the
time of grant of LTIP Units, one or more certificates representing the
appropriate number of LTIP Units granted to a grantee shall be registered in his
or her name, but shall be held by the Company for the account of the grantee.
Upon the occurrence of certain specified events, and subject to conditions
specified in the Plan Agreement, the grantee shall have all rights of a unit
holder as to such LTIP Units, including the right to (i) receive distributions
and allocations, (ii) redeem the LTIP Units for cash in an amount equal to the
FMV of an equal number of OP Units or shares of Common Stock or (iii) convert
such LTIP Units into OP Units or shares of Common Stock; provided, however, that
(A) the grantee shall not be entitled to delivery of certificates representing
the LTIP Units until the expiration of the Restricted Period; and (B) except as
otherwise provided in the Plan Agreement, none of the LTIP Units may be
assigned, transferred, otherwise encumbered or disposed of by the grantee during
the Restricted Period. Any OP Units, shares of Common Stock or other securities
or property received with respect to such LTIP Units shall be subject to the
same restrictions as such LTIP Units. Once the LTIP Units have vested (or, if
longer, following the completion of the Restricted Period) and all conditions
contained in the Plan Agreement or award of LTIP Units and in the Plan have been
satisfied, the appropriate number of OP Units shall be delivered to the grantee,
free of restrictions, in the form of OP Unit certificates (or, if and to the
extent that such units are converted into shares of Common Stock, the Company
shall issue to the grantee (or the grantee's designated beneficiary in the event
of the grantee's death) one or more certificates for the appropriate number of
shares of Common Stock).
ARTICLE 4. MISCELLANEOUS
4.1. Amendment of the Plan; Modification of Awards.
(a) Plan Amendments. The Board may, without stockholder approval, at any
time and from time to time suspend, discontinue or amend the Plan in any respect
whatsoever, except that (i) no such amendment shall impair any rights under any
award theretofore made under the Plan without the consent of the grantee of such
award, (ii) except as and to the extent otherwise permitted by Section 4.5 or
4.11, no such amendment shall cause the Plan to fail to satisfy any applicable
requirement under Rule 16b-3 without stockholder approval, and (iii) to the
extent required to meet the requirements of any national securities exchange or
system on which the shares of Common Stock are then listed or reported,
stockholder approval shall be necessary for any amendment that constitutes a
material revision to the Plan.
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(b) Award Modifications. Subject to the terms and conditions of the Plan
(including Section 4.1(a)), the Committee may amend outstanding Plan Agreements
with such grantee, including, without limitation, any amendment which would (i)
accelerate the time or times at which an award may vest or become exercisable
and/or (ii) extend the scheduled termination or expiration date of the award;
provided, however, that no modification having a material adverse effect upon
the interest of a grantee in an award shall be made without the consent of such
grantee; and provided, further, that no amendment may be made to adjust the
option exercise price per share specified in a Plan Agreement evidencing a stock
option award, unless such adjustment occurs pursuant to Section 4.5, and no
award may be cancelled and re-granted to effect a re-pricing.
4.2. Restrictions.
(a) Consent Requirements. If the Committee shall at any time determine
that any Consent (as hereinafter defined) is necessary or desirable as a
condition of, or in connection with, the granting of any award under the Plan,
the acquisition, issuance or purchase of shares or other rights hereunder or the
taking of any other action hereunder (each such action being hereinafter
referred to as a "Plan Action"), then such Plan Action shall not be taken, in
whole or in part, unless and until such Consent shall have been effected or
obtained to the full satisfaction of the Committee. Without limiting the
generality of the foregoing, the Committee shall be entitled to determine not to
make any payment whatsoever until Consent has been given if (i) the Committee
may make any payment under the Plan in cash, Common Stock or both, and (ii) the
Committee determines that Consent is necessary or desirable as a condition of,
or in connection with, payment in any one or more of such forms.
(b) Consent Defined. The term "Consent" as used herein with respect to any
Plan Action means (i) any and all listings, registrations or qualifications in
respect thereof upon any securities exchange or other self regulatory
organization or under any federal, state or local law, rule or regulation, (ii)
the expiration, elimination or satisfaction of any prohibitions, restrictions or
limitations under any federal, state or local law, rule or regulation or the
rules of any securities exchange or other self regulatory organization, (iii)
any and all written agreements and representations by the grantee with respect
to the disposition of shares, or with respect to any other matter, which the
Committee shall deem necessary or desirable to comply with the terms of any such
listing, registration or qualification or to obtain an exemption from the
requirement that any such listing, qualification or registration be made, and
(iv) any and all consents, clearances and approvals in respect of a Plan Action
by any governmental or other regulatory bodies or any parties to any loan
agreements or other contractual obligations of the Company or any Affiliate.
4.3. Nontransferability. No award granted to any grantee under the Plan or
under any Plan Agreement shall be assignable or transferable by the grantee
other than by will or by the laws of descent and distribution. During the
lifetime of the grantee, all rights with respect to any award granted to the
grantee under the Plan or under any Plan Agreement shall be exercisable only by
the grantee.
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4.4. Withholding Taxes.
(a) Whenever under the Plan shares of Common Stock and/or OP Units are to
be delivered pursuant to an award, the Committee may require as a condition of
delivery that the grantee remit an amount sufficient to satisfy all federal,
state and other governmental withholding tax requirements related thereto.
Whenever cash is to be paid under the Plan, the Company may, as a condition of
its payment, deduct therefrom, or from any salary or other payments due to the
grantee, an amount sufficient to satisfy all federal, state and other
governmental withholding tax requirements related thereto or to the delivery of
any shares of Common Stock and/or OP Units under the Plan.
(b) 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 of Common Stock and/or OP Units owned by the
grantee for at least six months (or such other period as the Committee may
determine) having a fair market value (determined as of the date of such
delivery by the grantee) equal to all or part of the amount to be so withheld,
provided that the Committee may require, as a condition of accepting any such
delivery, the grantee to furnish an opinion of counsel acceptable to the
Committee to the effect that such delivery would not result in the grantee
incurring any liability under Section 16(b) of the Act and (ii) the Committee
may permit any such delivery to be made by withholding shares of Common Stock
and/or OP Units from the shares or units 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).
4.5. Adjustments Upon Changes in Capitalization. If and to the extent
specified by the Committee, the number of shares of Common Stock and/or OP Units
which may be issued pursuant to awards under the Plan, the maximum number of
options which may be granted to any one person in any year, the number of shares
of Common Stock and/or OP Units subject to awards, the option exercise price of
options theretofore granted under the Plan, and the amount payable by a grantee
in respect of an award, shall be appropriately adjusted (as the Committee may
determine) for any change in the number of issued shares of Common Stock and/or
OP Units resulting from the subdivision or combination of shares of Common Stock
and/or OP Units or other capital adjustments, or the payment of a stock dividend
or unit distribution after the effective date of the Plan, or other change in
such shares of Common Stock and/or OP Units effected without receipt of
consideration by the Company; provided that any awards covering fractional
shares of Common Stock and/or OP Units resulting from any such adjustment shall
be eliminated and provided further, that each ISO granted under the Plan shall
not be adjusted in a manner that causes such option to fail to continue to
qualify as an ISO within the meaning of Code Section 422. Adjustments under this
Section shall be made by the Committee, whose determination as to what
adjustments shall be made, and the extent thereof, shall be final, binding and
conclusive.
4.6. Right of Discharge Reserved. Nothing in the Plan or in any Plan
Agreement shall confer upon any person the right to continue in the employment
of the Company or an Affiliate or affect any right which the Company or an
Affiliate may have to terminate the employment of such person.
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4.7. No Rights as a Stockholder. No grantee or other person shall have any
of the rights of a stockholder of the Company with respect to shares or of a
unit holder of the Operating Partnership with respect to units, as applicable,
subject to an award until the issuance to him or her of a stock certificate for
such shares or a certificate evidencing such units, as applicable. Except as
otherwise provided in Section 4.5, no adjustment shall be made for dividends,
distributions or other rights (whether ordinary or extraordinary, and whether in
cash, securities or other property) for which the record date is prior to the
date such stock certificate or unit certificate, as applicable, is issued. In
the case of a grantee of an award which has not yet vested, the grantee shall
have the rights of a stockholder of the Company or of a unit holder of the
Operating Partnership, as applicable, if and only to the extent provided in the
applicable Plan Agreement.
4.8. Nature of Payments.
(a) Any and all awards or payments hereunder shall be granted, issued,
delivered or paid, as the case may be, in consideration of services performed
for the Company or for its Affiliates by the grantee.
(b) No such awards and payments shall be considered special incentive
payments to the grantee or, unless otherwise determined by the Committee, be
taken into account in computing the grantee's salary or compensation for the
purposes of determining any benefits under (i) any pension, retirement, life
insurance or other benefit plan of the Company or any Affiliate or (ii) any
agreement between the Company or any Affiliate and the grantee.
(c) By accepting an award under the Plan, the grantee shall thereby waive
any claim to continued exercisability or vesting of an award or to damages or
severance entitlement related to non-continuation of the award beyond the period
provided herein or in the applicable Plan Agreement, notwithstanding any
contrary provision in any written employment contract with the grantee, whether
any such contract is executed before or after the grant date of the award.
4.9. Non-Uniform Determinations. The Committee's determinations under the
Plan need not be uniform and may be made by it selectively among persons who
receive, or are eligible to receive, awards under the Plan (whether or not such
persons are similarly situated). Without limiting the generality of the
foregoing, the Committee shall be entitled, among other things, to make
non-uniform and selective determinations, and to enter into non-uniform and
selective Plan Agreements, as to (a) the persons to receive awards under the
Plan, (b) the terms and provisions of awards under the Plan, and (c) the
treatment of leaves of absence pursuant to Section 2.5(c).
4.10. Other Payments or Awards. Nothing contained in the Plan shall be
deemed in any way to limit or restrict the Company, any Affiliate or the
Committee from making any award or payment to any person under any other plan,
arrangement or understanding, whether now existing or hereafter in effect.
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4.11. Reorganization.
(a) In the event that the Company is merged or consolidated with another
corporation and, whether or not the Company shall be the surviving corporation,
there shall be any change in the shares of Common Stock by reason of such merger
or consolidation, or in the event that all or substantially all of the assets of
the Company are acquired by another person, or in the event of a reorganization
or liquidation of the Company (each such event being hereinafter referred to as
a "Reorganization Event") or in the event that the Board shall propose that the
Company enter into a Reorganization Event, then the Committee may in its
discretion, by written notice to a grantee, provide that his or her options will
be terminated unless exercised within 30 days (or such longer period as the
Committee shall determine in its sole discretion) after the date of such notice;
provided that if, and to the extent that, the Committee takes such action with
respect to the grantee's options not yet exercisable, the Committee shall also
accelerate the dates upon which such options shall be exercisable. The Committee
also may in its discretion by written notice to a grantee provide that all or
some of the restrictions on any of the grantee's awards may lapse in the event
of a Reorganization Event upon such terms and conditions as the Committee may
determine.
(b) Whenever deemed appropriate by the Committee, the actions referred to
in Section 4.11(a) may be made conditional upon the consummation of the
applicable Reorganization Event.
4.12. Section Headings. The section headings contained herein are for the
purposes of convenience only and are not intended to define or limit the
contents of said Sections.
4.13. Effective Date and Term of Plan.
(a) The Plan shall be deemed adopted and become effective upon the
approval thereof by the stockholders of the Company.
(b) The Plan shall terminate 10 years after the date on which it is
approved by stockholders, and no awards shall thereafter be made under the Plan.
Notwithstanding the foregoing, all awards made under the Plan prior to such
termination date shall remain in effect until such awards have been satisfied or
terminated in accordance with the terms and provisions of the Plan and the
applicable Plan Agreement.
4.14. Governing Law. The Plan shall be governed by the laws of the State
of New York applicable to agreements made and to be performed entirely within
such state.
ARTICLE 5. RESTRICTED STOCK/RESTRICTED STOCK UNIT AWARDS GRANTED TO
INDEPENDENT DIRECTORS
5.1. Automatic Grant of Restricted Stock/Restricted Stock Units. Each
Independent Director appointed or elected to the Board for the first time shall
automatically be granted (under this Plan or another applicable Company stock
option plan) 1,000 shares of restricted stock or 1,000 restricted stock units,
as determined by such Independent Director, on his or her date of appointment or
election. Each Independent Director who is serving as a Director of the Company
on the fifth business day after each annual meeting of stockholders shall, on
such day, automatically be granted (under this Plan or another applicable
Company stock option plan) either a number of shares of restricted stock or a
number of restricted stock units, as determined by such Independent Director,
having a fair market value of $20,000 on the date of grant; provided, however,
that an Independent Director who is also serving as the lead non-employee
director of the Board of Directors as of the fifth business day after such
annual meeting shall, on such day, automatically be granted (under this Plan or
another applicable Company stock option plan), in lieu of receiving such number
of shares or restricted stock units having a fair market value of $20,000 on the
date of grant, either a number of shares of restricted stock or a number of
restricted stock units, as determined by such Independent Director, having a
fair market value of $30,000 on the date of grant; and provided, further that an
Independent Director who is appointed or elected to the Board for the first time
shall not be eligible to receive restricted stock or restricted stock units, as
applicable, pursuant to this sentence for the year of his or her initial
appointment or election.
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5.2. Discretionary Grant of Restricted Stock/Restricted Stock Units. The
Committee (composed entirely of Independent Directors), in its discretion, may
grant additional awards of restricted stock or restricted stock units to the
Independent Directors; provided, however, that the total cumulative amount of
such awards to Independent Directors under this Plan may not exceed 10% of the
shares of Common Stock authorized for grant under this Plan. Any such grant may
vary among individual Independent Directors.
5.3. Vesting; Non-Transferability; Issuance of Shares or Restricted Stock
Units
(a) All shares of restricted stock or restricted stock units granted under
this Article 5 shall vest immediately.
(b) No shares of restricted stock or restricted stock units granted under
this Article 5 shall be transferable by an Independent Director while such
Independent Director remains a Director of the Company. The shares of restricted
stock or restricted stock units granted under this Article 5 shall be
transferable, subject to any restrictions imposed by applicable law, by an
Independent Director immediately on the date upon which such Independent
Director ceases to be a Director of the Company. Restricted stock units granted
under this Article 5 shall be settled solely in shares of Common Stock within 30
days of the date upon which such Independent Director ceases to be a Director of
the Company. Restricted stock units granted under this Article 5 shall not be
settled in cash.
(c) Where shares of restricted stock are awarded under this Article 5, as
soon as practicable after the date of grant, the Company shall register, in the
name of each applicable Independent Director, one or more certificates
representing the number of shares of restricted stock granted to such Director
and bearing the appropriate legend specifying that such shares are not
transferable and are subject to the terms and conditions of the Plan.
5.4. Limited to Independent Directors. The provisions of this Article 5
shall apply only to restricted stock or restricted stock unit awards granted or
to be granted to Independent Directors, shall be interpreted as if this Article
5 constituted a separate plan of the Company and shall not be deemed to modify,
limit or otherwise apply to any other provision of this Plan or to any
restricted stock or restricted stock unit award granted under this Plan to a
participant who is not an Independent Director of the Company. To the extent
inconsistent with the provisions of any other Section of this Plan, the
provisions of this Article 5 shall govern the rights and obligations of the
Company and Independent Directors respecting restricted stock or restricted
stock unit awards granted or to be granted to Independent Directors. The
provisions of this Article 5 shall not be amended more than once every six
months other than to comport with changes in applicable law.
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