FORM OF COLONIAL PROPERTIES TRUST THIRD AMENDED AND RESTATED EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN RESTRICTED SHARE AGREEMENT
Exhibit 10.2
FORM OF
COLONIAL PROPERTIES TRUST
THIRD AMENDED AND RESTATED
EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN
RESTRICTED SHARE AGREEMENT
COLONIAL PROPERTIES TRUST
THIRD AMENDED AND RESTATED
EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN
RESTRICTED SHARE AGREEMENT
THIS AGREEMENT is entered into as of ___, ___, by and between Colonial Properties
Trust, (the “Company”), and ___, a key employee of Company and/or of its Subsidiaries or
Affiliates (the “Holder”).
Recitals:
WHEREAS, Company has adopted the Colonial Properties Trust Third Amended and Restated
Employee Share Option and Restricted Share Plan (the “Plan”) providing for the grant under certain
circumstances of common shares of beneficial interest of the Company, par value $.01 per share (the
“Shares”);
WHEREAS, Company, under the terms and conditions set forth below, has offered and committed to
grant Shares under the Plan (the “Restricted Share Award”) to the Holder in connection with the
employment of the Holder in the capacity set forth below; and
WHEREAS, in consideration of the grant of the Restricted Share Award and other benefits, the
Holder is willing to accept the Restricted Share Award provided for in this Agreement and is
willing to abide by the obligations imposed on him or her under this Agreement and the other
responsibilities of his or her position;
Provisions:
NOW, THEREFORE, in consideration of the mutual benefits hereinafter provided, and each
intending to be legally bound, Company and the Holder hereby agree as follows:
| 1. | Effect of the Plan. |
The Restricted Share Award to be granted under this Agreement will be subject to all of the
terms and conditions of the Plan. The Holder will abide by, and the Restricted Share Award granted
to the Holder will be subject to, all of the provisions of the Plan and of this Agreement, together
with all rules and determinations from time to time issue by the Committee established to
administer the Plan and by the Board of Trustees of Company (hereinafter “Board”) pursuant to the
Plan.
2. Grants.
The Holder is hereby granted and issued ___Shares. Concurrently with the execution and
delivery of this Agreement, the Company is issuing and delivering to Holder certificates
representing the Shares being acquired by him, registered in his name. The Xxxxx Date of this
Restricted Share Award is ___, ___.
3. Vesting in Restricted Shares.
3.1 Service Requirement. The Restricted Share Award becomes vested (i.e.,
nonforfeitable) as to 100% of the Restricted Shares on the [fifth] anniversary of the Grant Date if
Holder has been providing services to the Company, a Subsidiary or an Affiliate continuously from
the Grant Date. Service for this purpose includes service as an employee, director or independent
contractor providing services to the Company, a Subsidiary or an Affiliate. For purposes of this
Agreement, termination of service would not be deemed to occur if
the Holder, after terminating service in one capacity, continues to provide service to the Company,
any Subsidiary or any Affiliate in another capacity. Termination of service is sometimes also
referred to herein as termination of employment or other relationship with the Company, its
Subsidiaries or its Affiliates.
3.2 Limitation Period. The period during which the Restricted Share Award is subject
to the vesting conditions of Section 3.1 above is the “Limitation Period.” Except as otherwise
determined by the Committee, during the Limitation Period applicable with respect to a Restricted
Share Award, the Holder may not sell, transfer, assign, pledge or otherwise encumber or dispose of
the Shares covered by such award. The certificate representing the Shares distributed with respect
to each Restricted Share Award made under the Plan shall be affixed with a legend setting forth the
restrictions applicable to the transfer of such Shares. When the restrictions applicable to a
Restricted Share Award shall lapse, a certificate for the number of Shares with respect to which
restrictions have lapsed shall be delivered to the Holder free of all such restrictions; provided,
however, the Company may retain possession of the number of shares required for the Holder to
satisfy the share retention guidelines in Section 12, below. Restricted Shares that are forfeited
shall be immediately transferred to the Company without any payment by the Company.
3.3 Termination of Service. If before the end of the Limitation Period, the Holder
terminates service with the Company by reason of the Holder’s death or “permanent and total
disability” (within the meaning of Section 22(e)(3) of the Code), the Holder, his or her legal
guardian, or the executor or administrator of the estate of the Holder or the person or persons to
whom rights under the Restricted Share Agreement have passed by bequest or inheritance, as the case
may be, shall vest in a prorated portion of the shares covered by the Restricted Share Agreement
based on the ratio of (x) the number of complete months from the Grant Date to the date of
termination of service to (y) 60. If the Holder terminates service with the Company for any reason
other than the Holder’s death or “permanent and total disability” (within the meaning of Section
22(e)(3) of the Code), the Holder shall immediately forfeit to the Company all unvested Restricted
Shares awarded hereunder.
4. Dividend and Voting Rights.
Subject to the restrictions contained herein, Holder, as owner of his Shares, shall have all
of the rights of a shareholder, including the right to vote such Shares and to receive all
dividends, cash or stock, paid or delivered thereon.
5. Change of Control; Sale of Assets/Shares.
5.1 Changes in Shares. If the number of outstanding Shares is increased or decreased
or the Shares are changed into or exchanged for a different number or kind of Shares or other
securities of the Company on account of any recapitalization, reclassification, Share split,
reverse split, combination of Shares, exchange of Shares, Share dividend or other distribution
payable in capital stock, or other increase or decrease in such Shares effected without receipt of
consideration by the Company occurring after the date the Restricted Share Award is granted, a
proportionate and appropriate adjustment shall be made by the Company in the number and kind of
Shares subject to the Restricted Share Agreement, so that the proportionate interest of the Holder
immediately following such event shall, to the extent practicable, be the same as immediately prior
to such event.
5.2. Reorganization in Which the Company Is the Surviving Entity. Subject to Section
5.3, if the Company shall be the surviving entity in any reorganization, merger or consolidation of
the Company with one or more other entities, the Restricted Share Award shall pertain to and apply
to the securities to which a holder of the number of Shares subject to the Restricted Share
Agreement would have been entitled immediately following such reorganization, merger or
consolidation.
5.3 Reorganization in Which the Company Is Not the Surviving Entity or Sale of Assets or
Shares. Upon the dissolution or liquidation of the Company, or upon a merger, consolidation or
reorganization of the Company with one or more other entities in which the Company is not the
surviving entity, or upon a sale of substantially all of the assets of the Company to another
entity, or upon any transaction (including, without limitation, a merger or reorganization in which
the Company is the surviving entity) approved by the Board which results in any person or entity
(or persons or entities acting as a group or otherwise in concert) owning 80 percent or more of the
combined voting power of all classes of securities of the Company, the Board, in its sole
discretion, shall make a written determination as to the treatment of the unvested Restricted
Shares.
5.4 Adjustments. Adjustments specified in this Section relating to Shares or
securities of the Company shall be made by the Committee, whose determination in that respect shall
be final, binding and conclusive. No fractional Shares or units of other securities shall be
issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall
be eliminated in each case by rounding downward to the nearest whole share or unit.
6. Requirements of Law.
The Company shall not be required to issue any Shares under the Agreement if the issuance of
such Shares would constitute a violation by the Holder or by the Company of any provision of any
law or regulation of any governmental authority, including without limitation any federal or state
securities laws or regulations. If at any time the Company shall determine, in its discretion,
that the listing, registration or qualification of any Shares subject to the Restricted Share
Agreement upon any securities exchange or under any state or federal law, or the consent or
approval of any government regulatory body, is necessary or desirable as a condition of, or in
connection with, the issuance of Shares hereunder, the Restricted Shares shall not vest in whole or
in part unless such listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Company. Specifically in
connection with the Securities Act of 1933 (as now in effect or as hereafter amended), unless a
registration statement under such Act is in effect with respect to the Shares covered by the
Restricted Share Agreement, the Company shall not be required to issue such Shares unless the
Company has received evidence satisfactory to it that the Holder may acquire such Shares pursuant
to an exemption from registration under such Act. Any determination in this connection by the
Company shall be final, binding, and conclusive. The Company may, but shall in no event be
obligated to, register any securities covered hereby pursuant to the Securities Act of 1933 (as now
in effect or as hereafter amended). The Company shall not be obligated to take any affirmative
action in order to cause the issuance of Shares pursuant thereto to comply with any law or
regulation of any governmental authority. As to any jurisdiction that expressly imposes the
requirement that the Restricted Shares shall not vest unless and until the Shares covered by the
Restricted Share Agreement are registered or are subject to an available exemption from
registration, the vesting of the Restricted Shares (under circumstances in which the laws of such
jurisdiction apply) shall be deemed conditioned upon the effectiveness of such registration or the
availability of such an exemption.
7. Withholding of Taxes.
The parties hereto recognize that the Company, a Subsidiary or an Affiliate may be obligated
to withhold federal and local income taxes and Social Security and Medicare taxes to the extent
that the Holder realizes compensation income in connection with the Restricted Shares. The Holder
agrees that the Company, a Subsidiary or an Affiliate may: (i) withhold amounts needed to cover
such taxes from payments otherwise due and owing to the Holder and (ii) sell or repurchase a
sufficient number of the Restricted Shares to pay such taxes without the consent of the Holder.
The Holder further agrees that upon demand the Holder will promptly pay to the Company, a
Subsidiary or an Affiliate having such obligation any additional amounts as may be necessary to
satisfy such withholding tax obligation. Such payment shall be made in cash or cash equivalent.
8. Disclaimer of Rights.
No provision in this Restricted Share Agreement shall be construed to confer upon the Holder
the right to be employed by the Company, any Subsidiary or any Affiliate, or to interfere in any
way with the right and authority of the Company, any Subsidiary or any Affiliate either to increase
or decrease the compensation of the Holder at any time, or to terminate any employment or other
relationship between the Holder and the Company, any Subsidiary or any Affiliate.
9. Interpretation of this Restricted Share Agreement.
All decisions and interpretations made by the Committee or the Board of Trustees of the
Company with regard to any question arising under the Plan or this Restricted Share Agreement shall
be binding and conclusive on the Company and the Holder and any other person entitled to the
Restricted Shares as provided for herein. In the event that there is any inconsistency between the
provisions of this Restricted Share Agreement and of the Plan, the provisions of the Plan shall
govern.
10. Governing Law.
This Restricted Share Agreement is executed pursuant to and shall be governed by the laws of
the State of Maryland (but not including the choice of law rules thereof).
11. Arbitration.
Any disputes between the Company and the Holder in any way concerning this Restricted Share
Agreement shall be submitted at the initiative of either party to mandatory arbitration before a
single arbitrator in Birmingham, Alabama pursuant to the Commercial Arbitration Rules of the
American Arbitration Association, or its successor, then in effect. The decision of the arbitrator
shall be rendered in writing, shall be final and may be entered as a judgment in any court in the
State of Alabama. The parties irrevocably consent to the jurisdiction of the federal and state
courts located in Alabama for this purpose. Each party shall be responsible for its or his own
costs incurred in such arbitration and in enforcing any arbitration award, including attorney’s
fees.
12. Shares Retention Guidelines
The Holder is required to retain for a period of five years from the date of vesting, seventy
five percent (75%) of the number of Restriced Shares in which the Holder vests, net of any shares
disposed of to pay taxes on the vesting of the Restricted Shares.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.
| COLONIAL PROPERTIES TRUST |
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| By: | |||||
WITNESS (as to Holder)
|
HOLDER |
