1
EXHIBIT 10.59
SIMON PROPERTY GROUP, L.P.
1998 STOCK INCENTIVE PLAN
INCENTIVE STOCK OPTION AGREEMENT
THIS INCENTIVE STOCK OPTION AGREEMENT ("Agreement"), effective the
________ day of_______________, [1998] [1999] by and between SIMON PROPERTY
GROUP, INC., a Delaware corporation (formerly Corporate Property Investors,
Inc.) (the "Company"), and XXXX X. XXXXXXX ("Employee").
BACKGROUND
By action of its Board of Directors and Stockholders, the Company has
adopted the Simon Property Group, L.P. 1998 Stock Incentive Plan (the "Plan"),
under which the Company may grant stock options and other stock awards to
employees of the Company. The Plan is administered by a committee ("Committee")
appointed by Simon Property Group, L.P. (the "Partnership") that has authority
to grant stock options to officers and other key employees of the Company and,
subject to the provisions of the Plan, to determine the employees to whom and
the time or times at which options will be granted, the number of shares to be
covered by each option, the period of time and requisite conditions for
exercising an option and the terms and provisions of the option agreements.
THE OPTION
The Committee has determined to grant a stock option to Employee, and
Employee, by his execution of this Agreement, agrees to accept the stock option,
subject to the following terms and conditions of the Plan:
SECTION 1. Grant of Option.
a. Number of Shares. The Company grants to Employee the right and
option to purchase, subject to the terms and conditions of this Agreement and
the Plan, a total of ______ shares of common stock of the Company, par value
$.0001) per share ("Common Stock"), which shares are designated as shares
granted under an incentive stock option (as that term is described in Section
1(d) below).
2
2
b. Option Price. The purchase price of all such shares of Common Stock
shall be $ per share.
c. "Option" Defined. The option granted hereby and all of Employee's
rights under this Agreement and the Plan are referred to collectively as the
"Option."
d. Tax Status of Option. The Option is designated as constituting an
"incentive stock option" that is qualified under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code").
SECTION 2. Vesting of Options. [Such Option vests as to 1/3 of the
total amount of shares of Common Stock covered by such Option on the
anniversary of the date of grant in each of the years 1999-2001. In addition,
such Option immediately vests as to all of the shares of Common Stock in the
event of Employee's death during employment with the Company, Disability,
retirement from the Company or any of its affiliates after attaining age 62
("Retirement"), or discharge without Cause or the Employee's voluntary
termination of employment for Good Reason, or upon a Change of Control (each
such term as defined in Section 3 below).]1 [Such Option vests as to 1/2 of the
total amount of shares of Common Stock covered by the Option on the
anniversary of the date of grant in each of the years 2000-2001.]2
SECTION 3. Definitions. (a) "Cause", "Disability" and "Good Reason."
For purposes of this Agreement, the terms "Cause", "Disability" and "Good
Reason" shall have the meanings attributed to them in the Employee's Employment
Agreement dated as of , 1998 ("Employment Agreement").
(b) "Change of Control". For purposes of this Agreement, the term
"Change of Control" shall have the meaning attributed to it in Section 4.5 of
the Plan.
SECTION 4. Termination of Option.
a. Termination for Cause or Resignation without Good Reason. If
Employee's employment is terminated by the Company for Cause or he voluntarily
resigns without Good Reason (other than as a result of death, Retirement or
Disability) the Option to the extent unexercised shall expire on the date of
such termination.
__________
1 To be used for options granted on the Effective Date of the Merger.
2 To be used for options granted on the first anniversary of the Effective Date
of the Merger.
3
3
b. Other Termination. If, before the Option vests as provided in
Section 2 above, Employee's employment with the Company terminates as a result
of death, Disability, Retirement, or discharge without Cause, or the Employee's
voluntary termination of employment for Good Reason, the Option shall become
vested in accordance with Section 2 and be exercised in accordance with Section
6.
SECTION 5. Exercise of Option.
a. Exercise Period - General. Subject to the provisions of Sections
5(b) below, Employee may exercise the Option to purchase the vested shares at
any time (whether while serving as an employee of the Company or after ceasing
to be an employee of the Company), and from time to time (but not as to less
than 50 shares at any one time), on and after the date such shares have vested
as provided in Section 2 above through and including _______________ ___, [2008]
[2009] [ten year anniversary] (the "Expiration Date").
b. Exercise Period - Death or Disability or Retirement. If Employee (i)
voluntarily terminates employment for Good Reason, (ii) terminates employment
due to a discharge without Cause, (iii) dies or incurs a Disability either while
serving as an employee of the Company or after ceasing to be an employee of the
Company while the Option is still outstanding, or (iv) terminates due to
Retirement, the Option may be exercised with respect to the vested optioned
shares by Employee or by the executor, administrator or personal representative
of Employee's estate or other person entitled by law to Employee's rights under
the Option at any time through and including the Expiration Date.
c. Exercise before the Expiration Date. Notwithstanding any other
provision of this Agreement, in no event may the Option or any portion of the
Option be exercised after _____________ __, [2008] [ten year anniversary].
SECTION 6. Manner of Exercise; Notices. The Option shall be exercised
by filing with the Partnership a written notice of Employee's intention to
purchase such shares, specifying the number of shares (but not less than 50
shares at any one time) and the date that the purchase is to occur. Payment of
the option price may be made (i) by certified or official bank check payable to
the Company (or the equivalent thereof acceptable to the Committee) or, with
4
4
the consent of the Committee, by personal check (subject to collection), (ii)
through the delivery of previously owned Common Stock that has been owned by
Employee for at least six months and that has a fair market value equal to the
option price, or (iii) with the consent of the Committee, by the promissory note
and agreement of the Employee providing for payment with interest on the unpaid
balance accruing at a rate not less than that needed to avoid the imputation of
income under Code section 7872 and upon such terms and conditions (including the
security, if any, therefor) as the Committee may determine in its sole
discretion; or (iv) by a combination of the foregoing. Full payment must be made
for all shares to be purchased before the shares will be released to Employee.
Payment in accordance with clause (i) above may be deemed to be satisfied, by
delivery to the Company of an assignment of a sufficient amount of the proceeds
from the sale of Common Stock acquired upon exercise to pay for all of the
Common Stock acquired upon exercise and an authorization to the broker or
selling agent to pay that amount to the Company, which sale shall be made at the
Employee's direction at the time of exercise, provided that the Committee may
require the Employee 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 Securities Exchange Act of
1934, as amended, and does not require any consent (as defined in Section 5.3 of
the Plan).
The exercise notice shall be addressed to the [General Counsel of the
Partnership at 000 Xxxx Xxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000], or at
such other address as the Company designates in writing to Employee. Any notice
to Employee shall be sent to his address as shown in the records of the Company
or at such other address as Employee designates in writing to the Company. Any
such notice shall be deemed to have been duly given if it is personally
delivered or registered and deposited, postage and registry fee prepaid, in a
United States Post Office.
For purposes of this Section 6, the "fair market value" of any shares
of Common Stock that are delivered in payment of the option price shall be equal
to (i) the last sale price for Common Stock for the business day immediately
preceding the date on which any portion of the Option is exercised as reported
on the New York Stock Exchange, or, if Common Stock is not traded on the New
York Stock Exchange, on the exchange on which such Common Stock is principally
traded, or, if no sale price is reported for such day, the first preceding
business day for which a sale price for Common Stock is reported.
5
5
SECTION 7. Reload Option. If Employee delivers shares of Common Stock
in payment of the option price of the Option, Employee shall be issued a new
stock option (the "Reload Option"), under the Plan or any subsequently adopted
Company stock incentive or stock option plan (collectively, the "Plans") that
has Common Stock available for option grant, upon the following terms: (i) the
number of option shares of Common Stock granted under the Reload Option shall be
equal to the number of shares of Common Stock that were delivered in payment of
the option price of the Option plus, if so provided by the Committee, the shares
retained by the Company to satisfy any Federal, state or local tax withholding
requirements in connection with the exercise of the Option; (ii) the option
exercise price of the Reload Option shall be equal to the fair market value of
the Common Stock on the day on which the Reload Option was granted, or, if
Common Stock is not then traded on the New York Stock Exchange, on the exchange
on which such Common Stock is principally traded; (iii) the Reload Option shall
have a term equal to the remaining term of the original Option to which it
relates (subject to earlier termination as provided in the Plan and this
Agreement); (iv) the Reload Option shall vest immediately, and (v) no Reload
Option may be exercised within one year from the date on which the Reload Option
was granted.
SECTION 8. Tax Provisions. At the request of Employee, the Company
shall retain or accept a sufficient number of shares in connection with the
receipt or exercise of the Option or a sale of the underlying shares to satisfy
the Company's tax withholding obligations, if any, or Employee's tax liabilities
with respect to such transactions.
SECTION 9. Adjustments upon Certain Changes in the Common Stock. If and
to the extent specified by the Committee, the number of shares of Common Stock
which may be issued pursuant to the exercise of the Option, the Option exercise
price, and the amount payable by the Employee as the exercise price, shall be
appropriately adjusted (as the Committee may determine) for any change in the
number of issued shares of Common Stock resulting from the subdivision or
combination of shares of Common Stock or other capital adjustments, or the
payment of a stock dividend or other change in such shares of Common Stock
effected without receipt of consideration by the Company; provided that any
awards covering fractional shares of Common Stock resulting from any such
adjustment shall be eliminated.
6
SECTION 10. Employee's Rights Prior to Issuance of Shares. Employee
shall not be, nor shall Employee have any of the rights or privileges of, a
stockholder of the Company with regard to any of the shares issuable upon
exercise of the Option unless and until a physical stock certificate for such
shares has been issued or such shares have been credited to Employee's account
under a book entry or comparable system.
SECTION 11. Assignment or Transfer. The Option shall not be
transferable by the Employee other than by will or the laws of descent and
distribution and may be exercised during the Employee's lifetime only by the
Employee. No assignment or transfer of this Option, or of the rights represented
thereby, whether voluntary or involuntary, by operation of law or otherwise,
shall vest in the purported assignee or transferee any interest or right herein
whatsoever.
SECTION 12. Continued Employment. Employee shall have no duty or
obligation to remain in the employ of the Company. Nothing in this Agreement
shall be deemed to confer upon Employee any right to continue in the employ of
the Company or to interfere in any way with the right of the Company to
terminate the employment of Employee, which is at will, at any time, subject to
the terms of his Employment Agreement.
SECTION 13. Binding on Successors. This Agreement shall be binding upon
and inure to the benefit of the Company and Employee and their respective
successors, representatives and assigns.
SECTION 14. Captions. The captions of this Agreement are for
convenience and reference only and in no way define, describe, extend or limit
the scope or intent of any of its provisions.
SECTION 15. Amendments. This Agreement may only be amended in writing
and with the mutual consent of the Company and Employee.
SECTION 16. Applicable Law. This Agreement and any disputes arising
under this Agreement shall be governed by, and construed in accordance with, the
laws of the State of Delaware and any applicable laws of the United States of
America.
7
7
IN WITNESS WHEREOF, the Company and Employee have executed this
Agreement as of the day and year first above written.
ATTEST: SIMON PROPERTY GROUP, INC.
____________________ By________________________
__________________________
Xxxx X. Xxxxxxx
