STOCK OPTION AGREEMENT dated as of [ ]
between BEDFORD PROPERTY INVESTORS, INC., a Maryland corporation (the
"Company"), and the other party signatory hereto (the "Director").
WHEREAS, the Director is currently a director of the
Company and, pursuant to the Company's Amended and Restated 1992
Directors' Stock Option Plan (the "Plan") and upon the terms and
subject to the conditions hereinafter set forth, the Company desires
to provide the Director with an incentive to remain in its service and
to increase his interest in the success of the Company by granting to
the Director a nonqualified stock option (the "Option") to purchase
shares of common stock, par value $0.02 per share, of the Company (the
"Common Stock");
NOW, THEREFORE, in consideration of the covenants and
agreements herein contained, the parties hereto agree as follows:
1. Definitions; Incorporation of Plan Terms. Capitalized
terms used herein without definition shall have the meanings assigned
to them in the Plan, a copy of which is attached hereto. This
Agreement and the Option shall be subject to the Plan, the terms of
which are hereby incorporated herein by reference, and in the event of
any conflict or inconsistency between the Plan and this Agreement, the
Plan shall govern. The date of grant of the Option shall be the date
specified at the foot of the signature page hereof.
2. Grant of Option. Subject to the terms and conditions
contained herein and in the Plan, the Company hereby grants the Option
to the Director. The Option's Date of Grant and per share exercise
price and the number of shares of Common Stock for which the Option is
exercisable are set forth at the foot of the signature page hereof.
The Option shall be exercisable as hereinafter provided.
3. Terms and Conditions of Option. The Option evidenced
hereby is subject to the following terms and conditions:
(a) Vesting. The Option awarded hereunder shall vest
and become exercisable on the date that is six months from the
Date of Grant (the "Vesting Date").
(b) Option Period. The Option shall expire ten years from
the Date of Grant, subject to earlier termination as provided
herein and in the Plan.
(c) Exercise Following Termination of Service Due to
Death. If the Director ceases to be a member of the Board by
reason of death, the Option, if exercisable at the time of the
Director's death, may be exercised by such Director's
Beneficiary at any time within one year after the date of such
termination of service, subject to the earlier expiration of
such Option as provided for in Section 3(b) above. At the end
of such one-year period, the Option shall expire. If the Option
is not exercisable at the date of termination of service, it
shall expire on such date.
(d) Exercise Following Termination of Service Due to
Disability. If the Director ceases to be a member of the Board
by reason of Disability, the Option, if exercisable at the time
of cessation of service due to such Disability, may be exercised
by the Director at any time within one year after the date of
such termination of service, subject to the earlier expiration
of such Option as provided for in Section 3(b) above. At the
end of such one-year period, the Option shall expire. If the
Option is not exercisable at the date of termination of service,
it shall expire on such date.
(e) Exercise Following Other Terminations of Service. If
the Director ceases to be a member of the Board for any reason
other than death or Disability, then the Director shall have the
right, subject to the terms and conditions hereof and in the
Plan, to exercise the Option if exercisable at the time of such
cessation of service, at any time within three months after the
date of such termination, subject to the earlier expiration of
the Option as provided for in Section 3(b) above; provided,
however, that in the event that the Director is also an employee
of the Company or becomes an employee upon ceasing to be a
member of the Board, the Option shall vest and become
exercisable in accordance with its terms and conditions and
shall remain exercisable for a period of three months after such
individual's employment with the Company terminates for any
reason. At the end of such three-month period, the Option shall
expire. Except as provided in the Plan, if the Option is not
exercisable at the date of termination of service, it shall
expire on such date.
(f) Notice of Exercise. Subject to the other terms and
conditions hereof and in the Plan, the Director may exercise the
Option, to the extent vested, by giving written notice of
exercise to the Company; provided, however, that in no event
shall the Option be exercisable for a fractional share.
(g) Payment. Subject to the last sentence of this Section
3(g), prior to the issuance of a certificate pursuant to Section
3(j) hereof evidencing the shares of Common Stock in respect of
which all or a portion of the Option shall have been exercised,
the Director shall have paid to the Company the exercise price
of the Option for all such shares purchased pursuant to the
exercise of the Option. Payment may be made by personal check,
bank draft or postal or express money order (such modes of
payment are collectively referred to as "cash") payable to the
order of the Company in U.S. dollars, or in shares of Common
Stock already owned by the Director for at least six months at
the time of exercise valued at their Fair Market Value as of the
last business day preceding the date of exercise, or in a
combination of cash or such shares. Payment of the exercise
price in shares of Common Stock shall be made (i) by delivering
to the Company the share certificate(s) representing the
required number of shares, with the Director signing his or her
name on the back or by attaching executed stock powers (the
signature of the Director must be guaranteed in either case) or
(ii) attesting to ownership of a sufficient number of shares of
Common Stock. In addition to the exercise methods described
above, the Director may exercise the Option through a procedure
whereby the Director delivers to the Company an irrevocable
notice of exercise in exchange for the Company issuing the
shares of Common Stock subject to the Option to a broker
previously designated or approved by the Company, subject to
such rules and procedures as the Administrator may determine
(for purposes of such a transaction the value of shares of the
Common Stock shall be deemed to equal the Fair Market Value of
the Common Stock on the date of exercise of the Option).
(h) Stockholder Rights. The Director shall have no rights
as a stockholder with respect to any shares of Common Stock
issuable upon exercise of the Option until a certificate
evidencing such shares shall have been issued to the Director
pursuant to Section 4(j), and no adjustment shall be made for
dividends or distributions or other rights in respect of any
share for which the record date is prior to the date upon which
the Director shall become the holder of record thereof.
(i) Limitation on Exercise. The Option shall not be
exercisable unless the Common Stock subject thereto has been
registered under the Securities Act and qualified under
applicable state "blue sky" laws in connection with the offer
and sale thereof, or the Company has determined that an
exemption from registration under the Securities Act and from
qualification under such state "blue sky" laws is available.
(j) Issuance of Shares. Subject to the foregoing
conditions, Section 3(k) and the terms of the Plan, as soon as
reasonably practicable after its receipt of a proper notice of
exercise and payment of the exercise price of the Option for the
number of shares with respect to which the Option is exercised,
the Company shall deliver to the Director (or following the
Director's death, the Beneficiary entitled to exercise the
Option), at the principal office of the Company or at such other
location as may be acceptable to the Company and the Director
(or such Beneficiary), one or more stock certificates for the
appropriate number of shares of Common Stock issued in
connection with such exercise.
(k) Deferral of Profit Shares. The Director may elect to
defer receipt of the shares of Common Stock otherwise
deliverable upon exercise of the Option. An election to defer
such delivery shall be irrevocable and shall be made in writing
on an Option Deferral Election Form at least six months prior to
exercise. If the Director exercises the Option at any time
after delivery of the Option Deferral Election Form by tendering
previously-owned shares of Common Stock, the Director's Deferred
Compensation Account will be credited with a number of Phantom
Stock Units equal to the number of shares of Common Stock for
which delivery is deferred. Phantom Stock Units shall be paid
by delivery of shares of Common Stock in accordance with the
timing and manner of payment elected by the Director on his or
her first Deferral Election Form filed in accordance with
Section 4, or, if no such election form has previously been
filed by the Director, then in accordance with the timing and
manner of payment elected by the Director on such Option
Deferral Election Form.
(l) Transferability. The Option may not be transferred,
pledged, assigned or otherwise disposed of except by will or the
laws of descent and distribution; provided, however, that the
Option may be, with the approval of the Administrator,
transferred to a member or members of the Director's immediate
family (as defined in the Plan) or to one or more trusts or
partnerships established in whole or in part for the benefit of
one or more of such immediate family members (collectively,
"Permitted Transferees"), subject to such rules and procedures as
may from time to time be adopted or imposed by the
Administrator. If the Option is transferred to a Permitted
Transferee, it shall be further transferable only by will or the
laws of descent and distribution or, for no consideration, to
another Permitted Transferee of the Director. The Director
shall notify the Company in writing prior to any proposed
transfer of the Option to a Permitted Transferee and shall
furnish the Company, upon request, with information concerning
such Permitted Transferee's financial condition and investment
experience.
4. Change in Control. In the event of a Change in
Control of the Company, the Option granted hereunder and held by the
Director as of the date such Change in Control is determined to have
occurred, if not yet exercisable and vested on such date, shall become
fully exercisable and vested; provided, however, that if the
Administrator shall receive an opinion from a nationally recognized
firm of accountants to the Company that the accelerated vesting of the
Option will prohibit the utilization of "pooling of interests"
accounting in connection with the transaction resulting in the Change
in Control of the Company, then the Option shall not become fully
exercisable and vested upon the Change in Control.
5. No Restriction on Right of Company to Effect Corporate
Changes.
Neither the Plan nor this Agreement shall affect in any way the right
or power of the Company or its stockholders to make or authorize any
or all adjustments, recapitalizations, reorganizations or other
changes in the Company's capital structure or its business, or any
merger consolidation of the Company, or any issuance of stock or of
options, warrants or rights to purchase stock or bonds, debentures,
preferred or prior preference stocks whose rights are superior to or
affect the Common Stock or the rights thereof or which are convertible
into or exchangeable for Common Stock, or the dissolution or
liquidation of the company, or any sale or transfer of all or any part
of its assets or business, or any sale or transfer of all or any part
of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.
6. Survival; Assignment. Reference in this Agreement to
either party shall be deemed to include the heirs and permitted
successors and assigns of such party; and all agreements herein by or
on behalf of the Participant, shall bind and inure to the benefit of
the heirs and permitted successors and assigns of such parties hereto.
The Director agrees to cause any future spouse of his or hers to
deliver to the Company a consent in the form of the consent set forth
in Exhibit A hereto validly executed by such spouse promptly after any
such person becomes his or her spouse.
7. Notices. All notices and other communications
provided for herein shall be in writing and shall be delivered by hand
or sent by certified or registered mail, return receipt requested,
postage prepaid, addressed, if to the Director, to his or her
attention at the mailing address set forth at the foot of the
signature page of this Agreement (or to such other address as the
Director shall have specified to the Company in writing) and, if to
the Company, to Bedford Property Investors, Inc., 000 Xxxxxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Secretary. All such
notices shall be conclusively deemed to be received and shall be
effective, if sent by hand delivery, upon receipt, or if sent by
registered or certified mail, on the fifth day after the day on which
such notice is mailed.
8. Waiver. The waiver by either party of compliance with
any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any other provision of this Agreement,
or of any subsequent breach by such party of a provision of this
Agreement.
9. Headings. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same
agreement. The headings of sections and subsections herein are
included solely for convenience of reference and shall not affect the
meaning of any of the provisions of this Agreement.
10. Governing Law. This Agreement shall shall be
governed by and construed in accordance with the laws of the Maryland
without giving effect to conflicts of law principles.
IN WITNESS WHEREOF, the Company has caused this Agreement
to be executed by its duly authorized officer and the Director has
executed this Agreement, both as of the day and year first above
written.
BEDFORD PROPERTY INVESTORS, INC.
By:
Name:
Title:
DIRECTOR
Name:
Address:
Number of Shares
Underlying Option:
Option Price:
Date of Grant:
EXHIBIT A
Consent of Spouse
The undersigned, as the spouse of the Director who
is the signatory to the foregoing Agreement, (a) hereby consents to,
confirms and ratifies any sale by such Director of any Option or
shares of Common Stock acquired upon exercise of any such Option
contemplated by the foregoing Agreement and for purposes of any
community property laws and all other laws conveys all of his or her
right, title and interest in and to such Option or Option Shares to
the purchaser of such Option or Option Shares and (b) agrees to be
bound by all of the Director's obligations under the foregoing
Agreement.
