Exhibit 10.2
[Form of Non-Qualified Stock Option
Agreement]
AVALONBAY COMMUNITIES, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
(2009 STOCK OPTION AND INCENTIVE PLAN)
Pursuant to the AvalonBay Communities, Inc.
2009 Stock Option and Incentive Plan (the “Plan”),
AvalonBay Communities, Inc. (the “Company”) hereby
grants to the Optionee named below an Option to purchase up to the
number of shares of the Company’s Common Stock, par value
$.01 per share (“Common Stock”) set forth below.
This option is subject to all of the terms and conditions as set
forth herein, in the Non-Qualified Stock Option Agreement Terms
(the “Terms”) which are attached hereto and
incorporated herein in their entirety, and in the Plan.
Capitalized terms used but not defined herein or in the Terms shall
have the respective meanings ascribed thereto in the
Plan.
Non-Qualified Stock
Option:
This Option does not qualify as an
incentive stock option under Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”), and
consequently shall be treated as a non-qualified stock option for
tax purposes.
Vesting Schedule
:
Subject to the provisions of
Section 4 and 6 of the Terms and the discretion of the Company
to accelerate the vesting schedule, one third of this option shall
become vested and exercisable on each of the first three
anniversary dates of this award.
In any event this Option shall
become fully vested and exercisable with respect to all of the
Option Shares three years after the date hereof.
Additional
Terms/Acknowledgements: The undersigned Optionee acknowledges receipt
of, and understands and agrees to, this Non-Qualified Stock Option
Agreement, including, without limitation, the Terms. Optionee
further acknowledges receipt of a copy of the Plan. Optionee
further acknowledges that as of the Date of Grant, this
Non-Qualified Stock Option Agreement, including, without
limitation, the Terms, and the Plan set forth the entire
understanding between Optionee and the Company regarding the
Options described herein and supersede all prior oral and written
agreements on that subject.
ATTACHMENT
: Non-Qualified Stock Option
Agreement Terms
1
AVALONBAY COMMUNITIES,
INC.
2009 STOCK OPTION AND INCENTIVE
PLAN
NON-QUALIFIED STOCK OPTION
AGREEMENT TERMS
1.
Vested Option Shares
. Subject to Section 4,
when this Option is vested with respect to any of the Option
Shares, this Option shall continue to be exercisable with respect
to such Option Shares (“Vested Option Shares”) at any
time or times prior to the Expiration Date.
2.
Manner of Exercise
. The Optionee may exercise
this Option only in the following manner: from time to time
on or prior to the Expiration Date of this Stock Option, the
Optionee may give written notice to the Administrator of his or her
election to purchase some or all of the Option Shares purchasable
at the time of such notice. This notice shall specify the
number of Option Shares to be purchased.
Payment of the purchase price for
the Option Shares may be made by one or more of the following
methods: (i) in cash, by certified or bank check or
other instrument acceptable to the Administrator; (ii) through
the delivery (or attestation to the ownership) of shares of Common
Stock that have been purchased by the Optionee on the open market
or that are beneficially owned by the Optionee and are not then
subject to any restrictions under any Company plan and that
otherwise satisfy any holding periods as may be required by the
Administrator; (iii) by the Optionee delivering to the Company
a properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company cash or
a check payable and acceptable to the Company to pay the option
purchase price, provided that in the event the Optionee chooses to
pay the option purchase price as so provided, the Optionee and the
broker shall comply with such procedures and enter into such
agreements of indemnity and other agreements as the Administrator
shall prescribe as a condition of such payment procedure;
(iv) by a “net exercise” arrangement pursuant to
which the Company will reduce the number of shares of Common Stock
issuable upon exercise by the largest whole number of shares with a
Fair Market Value that does not exceed the aggregate exercise
price; or (v) a combination of (i), (ii), (iii) and
(iv) above. Payment instruments will be received subject
to collection.
The transfer to the Optionee on the
records of the Company or of the transfer agent of the Option
Shares will be contingent upon (i) the Company’s receipt
from the Optionee of the full purchase price for the Option Shares,
as set forth above, (ii) the fulfillment of any other
requirements contained herein or in the Plan or in any other
agreement or provision of laws, and (iii) the receipt by the
Company of any agreement, statement or other evidence that the
Company may require to satisfy itself that the issuance of Common
Stock to be purchased pursuant to the exercise of Stock Options
under the Plan and any subsequent resale of the shares of Stock
will be in compliance with applicable laws and regulations.
In the event the Optionee chooses to pay the purchase price by
previously-owned shares of Common Stock through the attestation
method, the number of shares of Common Stock transferred to the
Optionee upon the exercise of the Stock Option shall be net of the
Shares attested to.
The shares of Common Stock purchased
upon exercise of this Option shall be transferred to the Optionee
on the records of the Company or of the transfer agent upon
compliance to the satisfaction of the Administrator with all
requirements under applicable laws or regulations in connection
with such issuance and with the requirements hereof and of the
Plan. The determination of the Administrator as to such
compliance shall be final and binding on the Optionee. The
Optionee shall not be deemed to be the holder of, or to have any of
the rights of a holder with respect to, any shares of Common Stock
subject to this Option unless and until this Option shall have been
exercised pursuant to the terms hereof, the Company or the transfer
agent shall have transferred the shares to the Optionee, and the
Optionee’s name shall have been entered as the stockholder of
record on the books of the Company. Thereupon, the Optionee
shall have full voting, dividend and other ownership rights with
respect to such shares of Common Stock.
The minimum number of shares with
respect to which this Option may be exercised at any one time shall
be 100 shares, unless the number of shares with respect to which
this Option is being exercised is the total number of shares
subject to exercise under this Option at the time.
2
Notwithstanding any other provision
hereof or of the Plan, no portion of this Option shall be
exercisable after the Expiration Date hereof.
3.
Non-transferability of
Option . This
Option is personal to the Optionee, is non-assignable and is not
transferable in any manner, by operation of law or otherwise, other
than by will or the laws of descent and distribution. This
Stock Option is exercisable, during the Optionee’s lifetime,
only by the Optionee, and thereafter, only by the Optionee’s
legal representative or legatee.
4.
Termination of
Employment . If the
Optionee’s employment
