BRANDYWINE REALTY
TRUST
NON-QUALIFIED OPTION
This
is a Non-Qualified Stock Option Award (the “ Award
”) from Brandywine Realty Trust, a Maryland real estate
investment trust (the “ Company ”), to
(“ Optionee ”) and is dated April 1, 2009
(the “ Date of Grant ”). Terms used herein as
defined terms and not defined herein have the meanings assigned to
them in the Brandywine Realty Trust Amended and Restated 1997
Long-Term Incentive Plan, as amended from time to time (the “
Plan ”).
1.
Definitions . As used herein:
(a) “
Board ” means the Board of Trustees of the Company, as
constituted from time to time.
(b) “
Cause ” means “Cause” as defined in the
Plan.
(c) “
Change of Control ” means a “Change of
Control” as defined in the Plan; provided that if the Change
in Control arises from a transaction described in clause (ii)(A) of
the definition of “Change in Control” in the Plan, then
a Change of Control shall occur hereunder on the date of the
closing or effectiveness of such transaction.
(d) “
Closing ” means the closing of the acquisition and
sale of the Shares as described in, and subject to the provisions
of, Paragraph 8 hereof.
(e) “
Closing Date ” means the date of the
Closing.
(f) “
Code ” means the Internal Revenue Code of 1986, as
amended from time to time, and any successor thereto.
(g) “
Common Share ” means a common share of beneficial
interest, $.01 par value per share, of the Company.
(h) “
Committee ” means the Committee appointed by the Board
in accordance with Section 2 of the Plan, if one is appointed and
in existence at the time of reference. If no committee has been
appointed pursuant to Section 2, or if such a committee is not
in existence at the time of reference, “Committee”
means the Board.
(i) “
Date of Exercise ” means the date on which the notice
required by Paragraph 5 hereof is given.
(j) “
Date of Grant ” has the meaning shown
above.
(k) “
Disability ” means “Disability” as defined
in the Plan.
(l) “
Expiration Date ” means the earliest of the
following:
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(i)
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If
the Optionee terminates employment with the Company for any reason
other than death, Disability or for Cause, 5:00 p.m. on the date
90 days following such termination of employment;
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(ii)
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If
the Optionee terminates employment with the Company because of
death or Disability, 5:00 p.m. on the first anniversary of the date
the Optionee terminates employment because of death or
Disability;
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(iii)
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If
the Optionee terminates employment with the Company for Cause, 5:00
p.m. on the date of such termination of employment;
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(iv)
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The
close of business on the date of a Change of Control;
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(v)
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5:00 p.m. on the day before the
tenth anniversary of the Date of Grant.
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(m) “
Fair Market Value ” means the Fair Market Value of a
Share, as determined pursuant to the Plan.
(n) “
Option ” means the option to purchase Shares hereby
granted.
(o) “
Option Price ” means $2.91 per Share. In the event of
any recapitalization, Share distribution or dividend, Share split
or combination, the Option Price shall be equitably and
proportionally adjusted. The Option Price shall also be subject to
adjustment pursuant to Section 3(c) of the Plan if, as and to the
extent determined by the Committee in its sole
discretion.
(p) “
Shares ” means the
Common Shares which are the subject of the Option hereby granted.
In the event of any recapitalization, Share distribution or
dividend, Share split or combination, the number of Shares that
remain subject to the Option shall be equitably and proportionally
adjusted if, as and to the extent determined by the Committee in
its sole discretion. The number of Shares that remain subject to
the Option shall also be subject to adjustment pursuant to Section
3(c) of the Plan if, as and to the extent determined by the
Committee in its sole discretion.
(q) “
Subsidiary ” means, with respect to the Company, a
subsidiary company, whether now or hereafter existing, as defined
in section 424(f) of the Code, and any other entity 50% or more of
the economic interests in which are owned, directly or indirectly,
by the Company.
2.
Grant of Option . Subject to the terms and conditions set
forth herein and in the Plan, the Company hereby grants to the
Optionee the Option to purchase any or all of the
Shares.
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3.
Time of Exercise of Options .
(a) Subject
to Paragraph 3(b), the Option may be exercised after such time
or times as set forth below, and shall remain exercisable until the
Expiration Date, when the right to exercise shall terminate
absolutely:
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(i)
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The
Option may be exercised for
[ ] of
the Shares subject to the Option on or after the first anniversary
of the Date of Grant. [Note: because the shares underlying the
ISO will vest on the third anniversary of the Date of Grant, a
“compensating adjustment” will be made to the vesting
schedule under this Option so that this option and the ISO, when
combined, provide for equal annual vesting over three years. For
example, if 100 options are awarded in total (with 20 of the
options being the ISO that vest entirely on the third anniversary
and with 80 remaining options being under this Option document),
then the vesting schedule under this Option document would be 33 on
the first anniversary; 33 on the second anniversary; and 33 on the
third anniversary.]
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(ii)
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The
Option may be exercised for an additional
[ ] of
the Shares subject to the Option on or after the second anniversary
of the Date of Grant.
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(iii)
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The
Option may be exercised for an additional
[ ] of
the Shares subject to the Option on or after the third anniversary
of the Date of Grant.
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Notwithstanding
the foregoing, the number of Shares available for exercise as
determined under this Paragraph 3 shall be rounded down to the
nearest whole Share. No Shares subject to the Option shall first
become exercisable following the Optionee’s termination of
employment.
(b) Notwithstanding
Paragraph 3(a), the Option shall become fully exercisable upon
the earliest of (i) the occurrence of a Change of Control,
(ii) the death of the Optionee or (iii) the Disability of
the Optionee. In addition, notwithstanding anything to the contrary
set forth in the Plan, upon or in anticipation of any Change in
Control, the Committee may, in its sole and absolute discretion and
without the need for the consent of the Optionee, take one or more
of the following actions contingent upon the occurrence of that
Change in Control: (i) cause the Option to become fully vested
and immediately exercisable for a reasonable period in advance of
the Change in Control and, to the extent not exercised prior to
that Change in Control, cancel the Option upon closing of the
Change in Control; (ii) cancel the Option, in whole or in
part, in exchange for a substitute option in a manner consistent
with the requirements of Treas. Reg. §1.424-1(a) or any
successor rule or regulation (notwithstanding the fact that the
original Option was not intended to satisfy the requirements for
treatment as an Incentive Stock Option); or (iii) cancel the
Option, in whole or in part, in exchange for cash and/or
other
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substitute
consideration with a value equal to (A) the number of Shares
subject to the Option, multiplied by (B) the difference, if
any, between the Fair Market Value per Share on the date of the
Change in Control and the Option Price; provided, that if the Fair
Market Value per Share on the date of the Change in Control does
not exceed the Option Price of the Option, the Committee may cancel
the Option without any payment of consideration therefor. In the
discretion of the Committee, any cash or substitute consideration
payable upon cancellation of the Option may be subjected to
earn-out, escrow, holdback or similar arrangements, to the extent
such arrangements are applicable to any consideration paid to
shareholders in connection with the Change in Control.
4.
Payment for Shares . Full payment for Shares purchased upon
the exercise of an Option may be made in cash. In addition, this
Option may be exercised through means of a “net
settlement,” whereby the Option Price will be satisfied by
cancellation of the Company’s obligation to issue a number of
Common Shares otherwise issuable upon such exercise, which number
of Common Shares will be equal to: (A) the total Option Price
payable to acquire the number of Shares as to which the Option is
then being exercised divided by (B) the then current Fair
Market Value per Common Share. The number of Shares actually
issuable upon such exercise will then be equal to the difference
between the number of Shares as to which the Option is then being
exercised and the number of Shares described in the preceding
sentence. Without limiting the foregoing, payment for Shares
purchased upon the exercise of an Option may, at the election of
the Optionee and as the Committee may, in its discretion, approve,
by surrendering Common Shares with an aggregate Fair Market Value
equal to the aggregate Option Price.
5.
Manner of Exercise . The Option shall be exercised by giving
written notice of exercise to:
Brandywine
Realty Trust
555 East Lancaster Avenue
Suite 100
Radnor, PA 19087
Attention: General Counsel
All notices
under this agreement shall be deemed to have been given when
hand-delivered, telecopied or transmitted electronically and shall
be irrevocable once given.
6.
Nontransferability of Option . The Option may not be
transferred or assigned by the Optionee otherwise than as and to
the extent permitted by Section 5(e) of the Plan; and any attempt
at assignment or transfer contrary to the provisions of the Plan or
the levy of any execution, attachment or similar process upon the
Option shall be null and void and without effect. Any exercise of
the Option by a person other than the Optionee shall be accompanied
by appropriate proofs of the right of such person to exercise the
Option.
7.
Securities Laws . The Committee may from time to time impose
any conditions on the exercise of the Option as it deems necessary
or appropriate to comply with the then-existing requirements of the
Securities Act of 1933, as amended, or of the Securities Exchange
Act of 1934, as amended, including Rule 16b-3 (or any similar
rule) of the Securities
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and Exchange
Commission. If the listing, registration or qualification of Shares
issuable on the exercise of the Option upon any securities exchange
or under any federal or state law, or the consent or approval of
any governmental regulatory body is necessary as a condition of or
in connection with the purchase of such Shares, the Company shall
not be obligated to issue or deliver the certificates (if any)
representing the Shares otherwise issuable on the exercise of the
Option unless and until such listing, registration, qualification,
consent or approval shall have been effected or obtained. If
registration is considered unnecessary by the Company or its
counsel, the Company may cause a legend to be placed on such Shares
calling attention to the fact that they have been acquired for
investment and have not been registered.
8.
Issuance of Certificate at Closing; Payment of Cash .
Subject to the provisions of this Paragraph 8, the Closing
Date shall occur as promptly as is feasible after the exercise of
the Option. Subject to the provisions of Paragraphs 7 and 9 hereof,
a certificate for the Shares issuable on the exercise of the Option
shall be delivered to the Optionee or to his personal
representative, heir or legatee at the Closing, provided
that no certificates for Shares will be delivered to the
Optionee or to his personal representative, heir or legatee unless
the Option Price has been paid in full and provided further
that th
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