Exhibit 10.5
[Form of Director Restricted Unit
Agreement]
AVALONBAY COMMUNITIES, INC.
RESTRICTED UNIT AGREEMENT
Pursuant to the terms of the
AvalonBay Communities, Inc. 2009 Stock Option and Incentive
Plan (the “Plan”), in consideration for services
rendered and to be rendered to AvalonBay Communities, Inc.
(the “Company”), in order to advance the interests of
the Company and its stockholders and effect the intended purposes
of the Plan, and for other good and valuable consideration, which
the Company has determined to be equal to the fair market value of
the Units, as defined below, the Company is awarding to the
Director herewith the Units, upon the terms and conditions set
forth herein and in the Restricted Unit Agreement Terms (the
“Terms”) which are provided herewith and incorporated
herein in their entirety. Capitalized terms used but not
defined herein shall have the respective meanings ascribed thereto
in the Terms or in the Plan.
Vesting Schedule
:
Subject to the provisions of the
Terms, the Director’s ownership interest in the Units shall
vest, and the status of the Units as Unvested Units and all
Restrictions with respect to the Units shall terminate, in
accordance with the following schedule of events:
|
Vesting Event
|
|
Shares Vested
|
|
|
|
|
|
|
|
Award Date
|
|
20
|
%
|
|
First Anniversary of Award
Date
|
|
40
|
%
|
|
Second Anniversary of Award
Date
|
|
60
|
%
|
|
Third Anniversary of Award
Date
|
|
80
|
%
|
|
Fourth Anniversary of Award
Date
|
|
100
|
%
|
|
|
|
|
|
|
Termination of the Director’s
service as a director by vote of the Company’s stockholders
for any reason other than Cause
|
|
100
|
%
|
|
|
|
|
|
|
Failure by the Board of Directors or
any authorized committee thereof to nominate the Director for
re-election for any reason other than for Cause
|
|
100
|
%
|
|
|
|
|
|
|
Failure of the Company’s
stockholders to re-elect the Director
|
|
100
|
%
|
|
|
|
|
|
|
Death or Disability of the
Director
|
|
100
|
%
|
|
|
|
|
|
|
If earlier than any of the above
events, a Sale Event
|
|
100
|
%
|
Additional
Terms/Acknowledgements: The Director acknowledges receipt of, and
understands and agrees to, this Restricted Unit Agreement,
including, without limitation, the Terms. The Director
further acknowledges that as of the Award Date, this Restricted
Unit Agreement, including, without limitation, the Terms, sets
forth the entire understanding between the Director and the Company
regarding the grant of Units described herein and supersedes all
prior oral and written agreements on that subject.
PROVIDED HEREWITH AND
INCORPORATED BY REFERENCE : Restricted Unit Agreement
Terms
1
AVALONBAY COMMUNITIES,
INC.
RESTRICTED UNIT AGREEMENT
TERMS
ARTICLE I
DEFINITIONS
The following terms used below in
this Agreement shall have the meaning specified below unless the
context clearly indicates to the contrary. Capitalized terms
not otherwise defined herein shall have the meanings set forth in
the Plan.
Section 1.1
- Cause
“Cause” means and shall
be limited to (a) an affirmative vote of the holders of at
least 75 percent of the shares entitled to vote at a meeting of
stockholders called for the purpose, resolving that the Director
should be removed from office or (b) a vote of the Board, the
Nominating Committee, if any, or any other authorized committee of
the Board resolving that the Director should not be nominated for
re-election as a director, in either case, as a result of
(i) conviction of a felony, (ii) declaration of unsound
mind by order of a court, (iii) gross dereliction of duty,
(iv) commission of any act involving moral turpitude or
(v) commission of an act that constitutes intentional
misconduct or a knowing violation of law if such action in either
event results in both an improper substantial personal benefit to
such Director and a material injury to the Company.
Section 1.2
- Common Stock
“Common Stock” shall
mean the common stock of the Company, $.01 par value.
Section 1.3
– Deferred
Stock
“Deferred Stock” shall
mean phantom stock of the Company. Each share of Deferred
Stock shall have the same value as each share of Common Stock and
shall be ultimately distributed to the Director in the form of
Common Stock.
Section 1.4 –
Disability
“Disability” shall mean
the Director’s inability to perform his normal required
services for the Company and its Subsidiaries for a period of six
consecutive months by reason of the individual’s mental or
physical disability, as determined by the Administrator in good
faith in its sole discretion.
Section 1.5
- Restrictions
“Restrictions” shall
mean the restrictions set forth in Article III of this
Agreement.
Section 1.6
- Secretary
“Secretary” shall mean
the secretary of the Company.
2
Section 1.7
- Unvested
Units
“Unvested Units” shall
mean the Units (as defined in the Restricted Unit Agreement) issued
under this Agreement for as long as such Units are subject to the
Restrictions (as hereinafter defined) imposed by this
Agreement.
ARTICLE II
RESTRICTED
UNITS
Section 2.1
- Unvested Units
Any Units granted on the Award Date
pursuant to this Agreement shall be considered Unvested Units for
purposes of this Agreement and shall be subject to the Restrictions
until such time or times and except to the extent that the
Director’s ownership interest in Units vests in
accord
