Exhibit 10.1

Pennsylvania Real Estate Investment Trust (“PREIT”)

2011 Incentive Compensation Opportunity Award

for                                          ,

 

            2011 Incentive Opportunity2               2011 Incentive Range3 - %
of Base Salary                                 
              Threshold4                 Target4            Outperformance4  

2011 Base Salary1

   $                                        Corporate Measure5, 8   Threshold7  
   Target7      Outperformance7         FFO Per Share6   $                    $
                   $                       2011 INCENTIVE              
OPPORTUNITY:*   $                    $                    $                

 

* The amount payable under this award will be paid in cash during the period
January 1, 2012 through March 15, 2012. Except as may be otherwise provided in
your employment agreement or determined by the Executive Compensation and Human
Resources Committee of the Board of Trustees of PREIT (the “Committee”), the
payment of any 2011 Incentive Compensation to you is conditioned on your
continued employment by PREIT or one of its affiliates through the date that
2011 Incentive Compensation is paid to officers generally.

The Grantee has read and understands this award, including the endnotes which
describe the terms of the award, and agrees to be bound by such terms. Further,
the Grantee agrees that any amount awarded and paid to the Grantee under this
award shall be subject to PREIT’s “Recoupment Policy” as in effect on the date
the Committee granted this award, and as such policy is subsequently amended.

IN WITNESS WHEREOF, PREIT has caused this 2011 Incentive Compensation
Opportunity Award to be duly executed by its duly authorized officer and the
Grantee has hereunto set his hand on                          , 2011.

 

PENNSYLVANIA REAL ESTATE INVESTMENT TRUST By:  

 

 

Grantee

--------------------------------------------------------------------------------

ENDNOTES

 

1 

“2011 Base Salary” means your regular, basic compensation from PREIT and/or a
PREIT affiliate for 2011, not including bonuses or other additional
compensation, but including contributions made by PREIT and/or a PREIT affiliate
on your behalf, by salary reduction pursuant to your election, (i) to an
arrangement described in section 401(k) of the Internal Revenue Code of 1986, as
amended (the “Code”), (ii) to a “cafeteria plan” (as defined in section 125(d)
of the Code), and (iii) for a “qualified transportation fringe” (as defined in
section 132(f) of the Code).

2 

“2011 Incentive Opportunity” means the opportunity to earn incentive
compensation for 2011, up to             % of your Base Salary, in the event
certain performance goals are achieved. Subject to notes 7 and 8, performance
relates solely to PREIT’s performance with respect to one measure of its
financial results for 2011.

3 

“2011 Incentive Range” means, depending on the level of performance achieved
(i.e., Threshold, Target or Outperformance), the percentage of your Base Salary
that you may earn under this 2011 Incentive Compensation Opportunity Award. If
the performance is between the Threshold level and the Target level, or between
the Target level and the Outperformance level, the percentage will be
interpolated accordingly.

4 

“Threshold” signifies a solid achievement, which is expected to have a
reasonably high probability of achievement, but which may fall short of
expectations. Threshold performance represents the level of performance that has
to be achieved before any of your potential 2011 Incentive Compensation is
earned. If the Threshold performance level is achieved, you will earn at least
            % of your 2011 Base Salary as your 2011 Incentive Compensation. If
the Threshold performance level is not met, you will not receive any 2011
Incentive Compensation.

“Target” generally signifies that the business objectives for the year, which
are expected to have a reasonable probability of achievement, have been met. For
purposes of this award, this represents approximately the mid-range of the
estimate for FFO Per Share publicly announced by PREIT on February 23, 2011. If
the Target performance level is achieved, you will earn at least             %
of your 2011 Base Salary as your 2011 Incentive Compensation.

“Outperformance” signifies an outstanding achievement, an extraordinary
performance by industry standards, and which is expected to have a modest
probability of achievement. If the Outperformance level is achieved, you will
earn             % of your 2011 Base Salary as your 2011 Incentive Compensation.
In no event will PREIT pay you 2011 Incentive Compensation under this award in
excess of             % of your 2011 Base Salary.

If the Committee exercises its authority under note 8, “Threshold”, “Target” and
“Outperformance” will apply, as appropriate, separately to FFO Per Share and to
the Supplemental Factor or Factors (see note 8).

 

5 

The “Corporate Measure” is the business performance factor (or factors, if the
Committee exercises its authority under note 8) on which performance is based,
and the “Corporate Salary Portion” is the amount of your 2011 Base Salary to
which the Corporate Measure is applied. In your case, that amount is
$            , or 100% of your 2011 Base Salary. Accordingly, in your case, the
Corporate Salary Portion and your 2011 Base Salary are identical.

6 

“FFO Per Share” means, with respect to each diluted share of beneficial interest
in PREIT, “funds from operations” of PREIT for its fiscal year ending
December 31, 2011, as reported to the public by PREIT after the end of the
fiscal year.

7 

The Committee shall have the authority, in its sole discretion, to adjust the
Threshold, Target and Outperformance levels set forth in this award if and to
the extent that, in the sole judgment of the Committee, the reported FFO Per
Share does not reflect the performance of PREIT for 2011 in a manner consistent
with the purposes of this award due to the effect of any unusual or nonrecurring
transaction or occurrence on the reported FFO Per Share. Any such adjustment
shall be made to the 2011 Incentive Compensation Opportunity Awards granted to
all officers of PREIT and PREIT affiliates. The Committee shall not be obligated
to make any adjustment. If the Committee elects to make an adjustment, it shall
be free to take such factors into account as it deems appropriate under the
circumstances in its sole discretion. Further, in the case of a transaction or
occurrence that also constitutes a “Change of Control” of PREIT (as defined in
your employment agreement), the Committee shall have the authority, in its sole
discretion, to accelerate the determination and payment of your 2011 Incentive
Compensation.

--------------------------------------------------------------------------------

8. 

The Committee shall have the authority, in its sole discretion, to determine
that up to 20% of your Base Salary shall be based upon one or more business
performance factors other than FFO Per Share (such other factors, the
“Supplemental Factors”). If the Committee exercises this authority, the
Committee shall determine on or prior to March 15, 2012 (i) the percentage of
your 2011 Base Salary, but not in excess of 20%, to be based on the Supplemental
Factor or Factors; (ii) the Supplemental Factor or Factors for 2011; and
(iii) the percentage of your 2011 Base Salary (from the Threshold to the
Outperformance percentage) to be awarded in respect of the Supplemental Factor
or Factors. Each of the determinations referred to in the preceding sentence
shall be applied uniformly to the Corporate Salary Portion of all officers of
PREIT or any of its affiliates. The Committee shall be free to select in its
sole discretion the Supplemental Factor or Factors for 2011 and the weight to be
accorded to each Supplemental Factor. The Committee shall be under no obligation
to exercise its authority under this note 8, and, if it does not exercise such
authority, your 2011 Incentive Compensation shall be determined, subject to note
7, solely by FFO Per Share. Determinations by the Committee under this note 8
and under note 7 for 2011 Incentive Compensation shall not affect to any extent
determinations that the Committee may make for future years. The Committee will
provide notice to each officer affected by a determination made under this note
8, which shall disclose the Supplemental Factor or Factors and such other
information as the Committee shall elect to include in the notice. A failure to
provide such notice shall not affect any determination hereunder.

9. 

The Committee has the sole authority to interpret the terms and provisions of
this award and to decide any questions that may arise under this award. Its
determinations shall be conclusive and binding on all parties.