Exhibit 10.3
[Performance-based Vesting]
LIBERTY PROPERTY TRUST
2008 LONG TERM INCENTIVE PLAN
TARGET UNIT AWARD AGREEMENT
     This TARGET UNIT AWARD AGREEMENT (the “Award Agreement”), dated as of __
__, 20___ (the “Award Date”) is delivered by Liberty Property Trust., a Maryland
real estate investment trust (the “Company”) to ___(the “Participant”).
RECITALS
     A. The Liberty Property Trust 2008 Long Term Incentive Plan (the “Plan”)
provides for the grant of Target Units.
     B. The Compensation Committee of the Board of Directors (the “Committee”)
has decided to make a Target Unit Award to the Participant as an inducement for
the Participant to promote the best interests of the Company and its
shareholders. The Participant may receive a copy of the Plan by contacting ___,
at ___.
     NOW, THEREFORE, the parties to this Award, intending to be legally bound
hereby, agree as follows:
1. Grant of Target Units. Subject to the terms and conditions set forth in this
Award Agreement, the Company hereby grants to the Participant up to an aggregate
maximum of___units (the “Target Units”), based on the achievement of the
performance goals established by the Committee and set forth on the attached
Exhibit A (the “Performance Goals”). Each Target Unit shall be a phantom right
and shall be equivalent to one common share of beneficial ownership, par value
$0.001 per share, of the Company (the “Common Share”) on the Redemption Date (as
defined below). The Target Units granted hereunder are intended to qualify as
“qualified performance-based compensation” under section 162(m) of the Internal
Revenue Code of 1986, as amended (the “Code”). The number of Target Units set
forth in this Paragraph 1 is the maximum number of Common Shares payable under
this Award Agreement. The actual number of Common Shares that may be paid to the
Participant pursuant to this Award Agreement will depend on whether the
Performance Goals are achieved and the satisfaction of other conditions as set
forth below. The Committee shall not have discretion to increase the number of
Common Shares payable based upon achievement of the Performance Goals, but the
Committee may reduce the number of Common Shares that are payable based upon the
Committee’s assessment.
2. Target Unit Account. The Company shall establish and maintain a Target Unit
account as a bookkeeping account on its records (the “Target Unit Account”) for
the Participant and shall record in such Target Unit Account the number of
Target Units granted to the Participant. The

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Participant shall not have any interest in any fund or specific assets of the
Company by reason of this grant or the Target Unit Account established for the
Participant.
3. Vesting.
     (a) Except as provided in subparagraph (b) below, in order to become vested
in the Target Units, the Participant must continue to be employed by, or
providing service to the Employer (as defined in the Plan) from the Award Date
through the Redemption Date; provided however, that the number of Target Units
that shall become vested shall be determined based on satisfaction of the
Performance Goals. No vesting of the Target Units shall occur until the
Committee has certified the level of achievement of the Performance Goals, which
certification shall occur as soon as administratively practicable after the end
of the applicable performance period, but not later than sixty (60) days
following the end of the applicable performance period (the “Certification
Date”). Any portion of the Target Units that do not become vested because of the
failure to fully satisfy the Performance Goals shall be forfeited as of the
Certification Date and the Participant shall have no rights with respect to
redemption of the portion of the Target Units that have become forfeited.
     (b) Except as provided in subparagraph (c) below, if at any time prior to
the Certification Date the Participant’s employment or service with the Employer
terminates for any reason other than death, Disability (as defined in the Plan)
or Retirement (as defined in the Plan), all of the Target Units subject to this
Award Agreement will be immediately forfeited and the Participant shall have no
rights with respect to the redemption of any portion of the Target Units.
     (c) Notwithstanding any provision to the contrary herein, if the
Participant’s employment or service with the Company is terminated on account of
the Participant’s death, Disability or Retirement, the Participant shall
continue to earn the Target Units based on the level of achievement of the
Performance Goals as certified by the Committee, and shall receive payment of
the Target Units as set forth herein. In order for the Participant to continue
to earn the Target Units following the Participant’s termination of employment
or service on account of Retirement as set forth in this subparagraph (c), the
Committee must make a determination, evidenced by an affirmative action on the
part of the Committee, that such termination of employment or service
constitutes termination of employment or other active for-profit service that is
undertaken in good faith by the Participant, meaning, among other factors that
may be taken into account in the sole discretion of the Committee, that the
termination of employment or service is determined by the Committee, in its sole
discretion, (i) not to be materially detrimental to the business interests of
the Company, (ii) not to result in a violation of any obligations of the
Participant to the Company, and (iii) to be motivated by the Participant’s
intention, following such termination, to cease working on a full-time basis,
for the Company or any other employer, or to provide services, whether on a
consulting, independent contractor, employee or other basis to any entity
engaged in the business of owning, operating or developing commercial real
estate. Absent such an affirmative action on the part of the Committee, the
vesting of the Target Units referred to in this subparagraph (c) shall not
occur.
4. Redemption. The Target Units shall be redeemed by the Company on the
Certification Date or as soon as administratively practicable thereafter, but
not later than thirty (30) days following the Certification Date (the
“Redemption Date”). On the Redemption Date, all Target

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Units that have vested will be redeemed and converted to an equivalent number of
Common Shares, and the Participant shall receive a single sum distribution of
the Common Shares, which shall be issued under the Company’s Share Incentive
Plan (as defined in the Plan) (or a successor plan thereto). All redemptions
pursuant to this Award Agreement and the Plan shall be deemed a separate payment
for purposes of section 409A of the Code.
5. Dividend Equivalents. Unless otherwise determined by the Committee, cash,
Common Shares or other property equal in value to the dividends paid with
respect to the Common Shares underlying the Target Units (the “Dividend
Equivalents”) shall be payable subject to the same Performance Goals and terms
as the Target Units to which they relate. Dividend Equivalents shall be credited
with respect to the Target Units to the Participant’s Target Unit Account from
the Award Date until the Redemption Date. If and to the extent that the Target
Units are forfeited, all related Dividend Equivalents shall also be forfeited.
In no event shall the Participant accrue more than $___of such Dividend
Equivalents during any calendar year.
6. Non-Transferability of Target Unit Award. No Target Units or Dividend
Equivalents awarded to the Participant under this Award Agreement may be
transferred, assigned,pledged, encumber or exercised by the Participant and a
Target Unit shall be redeemed and a Dividend Equivalent distributed during the
Participant’s lifetime only for the benefit of the Participant . Any attempt to
transfer, assign, pledge, or encumber the Target Units or Dividend Equivalent by
the Participant shall be null, void and without effect.
7. No Rights as Shareholder. The Participant shall not have any rights as a
shareholder of the Company, including the right to any cash dividends (except as
provided in Paragraph 5), or the right to vote, with respect to any Target
Units.
8. Change of Control. The provisions set forth in the Plan applicable to a
Change in Control (as defined in the Plan) shall apply to the Target Units. In
the event of a Change in Control, the Committee may take such actions as it
deems appropriate in accordance with the terms of the Plan and consistent with
the requirements of section 409A of the Code.
9. Incorporation by Reference; Definitions. This Award Agreement shall be
subject to the terms, conditions and limitations of the Plan, which are
incorporated herein by reference, and in all respects shall be interpreted in
accordance with the Plan. In the event of any contradiction, distinction or
difference between this Award Agreement and the terms of the Plan, the terms of
the Plan will control. Except as otherwise defined in this Award Agreement, the
terms used in this Award Agreement shall have the meanings set forth in the
Plan. The grant is subject to the interpretations, regulations and
determinations concerning the Plan established from time to time by the
Committee in accordance with the provisions of the Plan. The Committee shall
have the authority to interpret and construe the grant pursuant to the terms of
the Plan, its decisions shall be conclusive as to any questions arising
hereunder, and the Participant’s acceptance of this grant is the Participant’s
agreement to be bound by the interpretations and decisions of the Committee with
respect to this grant and the Plan

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10. Restrictions on Issuance or Transfer of Shares of Common Stock.
     (a) The obligation of the Company to deliver Common Shares upon the
redemption of the Target Units shall be subject to the condition that if at any
time the Committee shall determine in its discretion that the listing,
registration or qualification of the Common Shares upon any securities exchange
or under any state or federal law, or the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of, or in
connection with, the issue of Common Shares, the Common Shares may not be issued
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 Committee. The issuance of the shares of Common Shares to the
Participant on the Redemption Date and the payment of cash to the Participant
pursuant to this grant is subject to any applicable taxes and other laws or
regulations of the United States or of any state having jurisdiction thereof.
     (b) As a condition to receive any Common Shares on the Redemption Date, the
Participant agrees to be bound by the Company’s policies regarding the transfer
of the Common Shares and understands that there may be certain times during the
year in which the Participant will be prohibited from selling, transferring,
pledging, donating, assigning, mortgaging, hypothecating or otherwise
encumbering the Common Shares.
     (c) On, or as soon as administratively practicable following the Redemption
Date, a certificate representing the Common Shares that are redeemed shall be
issued to the Participant.
11. Withholding. The Participant is required to pay to the Company, or make
other arrangements satisfactory to the Employer to provide for the payment of,
any federal, state, local or other taxes that the Employer is required to
withhold with respect to the grant, vesting or redemption/distribution of the
Target Units and Dividend Equivalents. Subject to Committee approval, the
Participant may elect to satisfy any tax withholding obligation of the Company
with respect to the redemption of the Target Units by having Common Shares
withheld up to an amount that does not exceed the minimum applicable withholding
tax rate for federal (including FICA), state, local and other tax liabilities.
12. No Rights to Continued Employment or Service. The terms and conditions of
this Award Agreement shall not be deemed to constitute a contract of employment
between the Company or the Employer and the Participant. Such employment
continues to be an “at will” employment relationship that can be terminated at
any time for any reason, or no reason, with or without Cause (as defined in the
Plan), and with or without notice, unless otherwise expressly provided for in
the Participant’s Employment Agreement (as defined in the Plan). Nothing in this
Award Agreement shall be deemed to give a Participant the right to be retained
in the service of the Company or the Employer, or to interfere in any way with
any right of the Company or the Employer to discipline or discharge the
Participant at any time, subject to the terms of the Participant’s Employment
Agreement (if applicable).
13. Assignment by the Company. The rights and protections of the Company
hereunder shall extend to any successors or assigns of the Company and to the
Company’s parents, subsidiaries, and affiliates. This grant may be assigned by
the Company without the Participant’s consent.
14. Acknowledgment. By executing this Award Agreement, the Participant hereby
acknowledges that with respect to any right to payment pursuant to this grant,
the Participant is

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and shall be an unsecured general creditor of the Company without any preference
as against other unsecured general creditors of the Company, and the Participant
hereby covenants for the Participant, and anyone at any time claiming through or
under the Participant not to claim any such preference, and hereby disclaims and
waives any such preference which may at any time be at issue, to the fullest
extent permitted by applicable law.
15. Application of Section 409A. This Award Agreement is not intended to
constitute or result in deferred compensation subject to the requirements of
section 409A of the Code. However, to the extent any amount payable under this
Award Agreement is subsequently determined to constitute deferred compensation
subject to the requirements of section 409A of the Code, this Award Agreement
shall be administered in accordance with the requirements of section 409A of the
Code. In such case, distributions made under this Award Agreement may only be
made in a manner and upon an event permitted by section 409A of the Code. To the
extent that any provision of this Award Agreement would cause a conflict with
the requirements of section 409A of the Code, or would cause the administration
of this Award Agreement to fail to satisfy the requirements of section 409A of
the Code, such provision shall be deemed null and void to the extent permitted
by applicable law. In no event shall the Participant, directly or indirectly,
designate the calendar year of distribution. For purposes of section 409A of the
Code each payment made under this Award Agreement shall be treated as a separate
payment. This Award Agreement may be amended without the consent of the
Participant in any respect deemed by the Committee to be necessary in order to
preserve compliance with section 409A of the Code.
16. Governing Law. This grant shall be deemed to be made under and shall be
construed in accordance with the laws of the Commonwealth of Pennsylvania,
without giving effect to the conflicts of laws provisions thereof.
17. Notice. Any notice to be given to the Company shall be in writing and shall
be addressed to the Treasurer of the Company at its principal executive office,
and any notice to be given to the Participant shall be addressed to the
Participant at the address then appearing in the records of the Company, or at
such other address as either party hereafter may designate in writing to the
other. Except as otherwise set forth herein, any such notice shall be deemed to
have been duly given, made and received only when personally delivered, or on
the day delivery is guaranteed when transmitted, addressed as aforesaid, to a
third party company or governmental entity providing delivery services in the
ordinary course of business, or two days following the day when deposited in the
United States mails, by registered or certified mail, postage prepaid, return
receipt requested, addressed as aforesaid..
[Signature Page Follows]

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[Performance-based Vesting]
     IN WITNESS WHEREOF, the Company has granted this Target Unit on the day and
year first above written.

            LIBERTY PROPERTY TRUST
      By:           Print Name and Title:             

I hereby accept the Target Units described in this Award Agreement. I have read
the terms of the Plan and this Award Agreement, and agree to be bound by the
terms of the Plan and this Award Agreement and the interpretations of the
Committee with respect thereto.

              ACKNOWLEDGED:
 
       
 
  By:    
 
            Participant

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Exhibit A
Performance Goals

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