EX-10.1






INDEPENDENCE REALTY TRUST, INC.

2016 LONG TERM INCENTIVE PLAN

(As Amended and Restated as of May 12, 2016)

INDEPENDENCE REALTY TRUST, INC.

2016 LONG TERM INCENTIVE PLAN




 



	 	 	 	 	 
	ARTICLE 1 PURPOSE
	 		1	
	1.1       General
	 		1	
	ARTICLE 2 DEFINITIONS
	 		1	
	2.1       Definitions
	 		1	
	ARTICLE 3 PLAN EFFECTIVE DATE; TERMINATION OF PLAN
	 		4	
	3.1       Plan Effective Date
	 		4	
	3.2       Termination of Plan
	 		4	
	ARTICLE 4 ADMINISTRATION
	 		4	
	4.1       Committee
	 		4	
	4.2       Actions and Interpretations by the Committee
	 		4	
	4.3       Authority of Committee
	 		5	
	4.4       Award Certificates
	 		5	
	ARTICLE 5 SHARES SUBJECT TO THE PLAN
	 		5	
	5.1       Number of Shares
	 		5	
	5.2       Share Counting
	 		5	
	5.3       Stock Distributed
	 		6	
	5.4       Share Valuation
	 		6	
	ARTICLE 6 ELIGIBILITY
	 		6	
	6.1       Eligibility
	 		6	
	6.2       Individual Limitation
	 		6	
	ARTICLE 7 STOCK OPTIONS
	 		6	
	7.1       General
	 		6	
	7.2       Incentive Stock Options
	 		6	
	ARTICLE 8 STOCK APPRECIATION RIGHTS
	 		6	
	8.1       Grant of Stock Appreciation Rights
	 		6	
	ARTICLE 9 RESTRICTED STOCK, RESTRICTED STOCK UNITS AND DEFERRED STOCK UNITS
	 		7	
	9.1       Grant of Restricted Stock, Restricted Stock Units and Deferred Stock Units
	 		7	
	9.2       Issuance and Restrictions
	 		7	
	9.3       Forfeiture
	 		7	
	9.4       Delivery of Restricted Stock
	 		7	
	ARTICLE 10 PERFORMANCE AWARDS
	 		7	
	10.1     Grant of Performance Awards
	 		7	
	10.2     Performance Goals
	 		8	
	10.3     Criteria Used for Objective Performance Goals
	 		8	
	ARTICLE 11 DIVIDEND EQUIVALENTS
	 		8	
	11.1     Grant of Dividend Equivalents
	 		8	
	ARTICLE 12 OTHER AWARDS
	 		8	
	12.1       Grant of Other Awards
	 		8	
	ARTICLE 13 PROVISIONS APPLICABLE TO AWARDS
	 		9	
	13.1       Term of Awards
	 		9	
	13.2       Form of Payment for Awards
	 		9	
	13.3       Limits on Transfer
	 		9	
	13.4       Beneficiaries
	 		9	
	13.5       Stock Trading Restrictions
	 		9	
	13.6       Acceleration upon Death or Disability
	 		9	
	13.7       Acceleration upon a Change in Control
	 		10	
	13.8       Acceleration for Any Reason
	 		10	
	13.9       Forfeiture Events
	 		10	
	13.10     Substitute Awards
	 		10	
	ARTICLE 14 CHANGES IN CAPITAL STRUCTURE
	 		10	
	14.1       Mandatory Adjustments
	 		10	
	14.2       Discretionary Adjustments
	 		11	
	14.3       General
	 		11	
	ARTICLE 15 AMENDMENT, MODIFICATION AND TERMINATION
	 		11	
	15.1       Amendment, Modification and Termination
	 		11	
	15.2       Awards Previously Granted
	 		11	
	15.3       Compliance Amendments
	 		11	
	ARTICLE 16 GENERAL PROVISIONS
	 		12	
	16.1       Rights of Participants
	 		12	
	16.2       Withholding
	 		12	
	16.3       Special Provisions Related to Section 409A of the Code
	 		12	
	16.4       Unfunded Status of Awards
	 		13	
	16.5       Relationship to Other Benefits
	 		13	
	16.6       Expenses
	 		13	
	16.7       Titles and Headings
	 		13	
	16.8       Gender and Number
	 		13	
	16.9       Fractional Shares
	 		13	
	16.10     Government and Other Regulations
	 		13	
	16.11     Governing Law
	 		14	
	16.12     Additional Provisions
	 		14	
	16.13     No Limitations on Rights of Company
	 		14	
	16.14     Indemnification
	 		14	
	16.15     Company Policies
	 		14	






 



INDEPENDENCE REALTY TRUST, INC.

2016 LONG TERM INCENTIVE PLAN




ARTICLE 1

PURPOSE




1.1. GENERAL. The purpose of the Independence Realty Trust, Inc. 2016 Long Term
Incentive Plan (the “Plan”) is to enable Independence Realty Trust, Inc. (the
“Company”) and its Affiliates (as defined below) to (1) provide an incentive to their
respective employees, officers, directors, trustees, consultants and advisors and to improve the
Company’s operations and increase the Company’s profits; (2) encourage such persons to accept or
continue employment with or provide other service to the Company and its Affiliates, as relevant;
and (3) increase the interest of such persons in the Company’s welfare through their participation
in the growth in the value of the Shares. Accordingly, the Plan permits the grant of incentive
awards from time to time to selected employees, officers, directors, trustees, consultants and
advisors of the Company and its Affiliates.



ARTICLE 2

DEFINITIONS




2.1. DEFINITIONS. When a word or phrase appears in this Plan with the initial letter
capitalized, and the word or phrase does not commence a sentence, the word or phrase shall
generally be given the meaning ascribed to it in this Section or in Section 1.1 unless a clearly
different meaning is required by the context. The following words and phrases shall have the
following meanings:




(a) “Affiliate” means (i) any Subsidiary or Parent, (ii) an entity that directly
or through one or more intermediaries controls, is controlled by or is under common control
with, the Company, as determined by the Committee, (iii) the Company’s advisor or an entity
that directly or through one or more intermediaries controls, is controlled by or is under
common control with, the Company’s advisor, as determined by the Committee, or (iv) the
Company’s property manager or an entity that directly or through one or more intermediaries
controls, is controlled by or is under common control with, the Company’s property manager, as
determined by the Committee.




(b) “Award” means any Option, Stock Appreciation Right, Restricted Stock,
Restricted Stock Unit, Deferred Stock Unit, Performance Award, Dividend Equivalent, Other
Award, or any other right or interest relating to Stock or cash, granted to a Participant under
the Plan.




(c) “Award Certificate” means a written document, in such form as the Committee
prescribes from time to time, setting forth the terms and conditions of an Award. Award
Certificates may be in the form of individual award agreements or certificates or a program
document describing the terms and provisions of an Award or series of Awards under the Plan.
The Committee may provide for the use of electronic, internet or other non-paper Award
Certificates, and the use of electronic, internet or other non-paper means for the acceptance
thereof and actions thereunder by a Participant.




(d) “Beneficial Owner” shall have the meaning given such term in Rule 13d-3 of the
General Rules and Regulations under the 1934 Act.




(e) “Board” means the Board of Directors of the Company.




(f) “Cause” as a reason for a Participant’s termination of employment shall have
the meaning assigned such term in the employment, severance or similar agreement, if any,
between such Participant and the Company or an Affiliate; provided, however,
that if there is no such employment, severance or similar agreement in which such term is
defined, and unless otherwise defined in the applicable Award Certificate, “Cause” shall mean
any of the following acts by the Participant, as determined by the Committee: gross neglect of
duty, prolonged absence from duty without the consent of the Company, material breach by the
Participant of any published Company or Affiliate code of conduct or code of ethics; or willful
misconduct, misfeasance or malfeasance of duty which is reasonably determined to be detrimental
to the Company. With respect to a Participant’s termination of directorship, “Cause” means an
act or failure to act that constitutes cause for removal of a director under applicable
Maryland law. The determination of the Committee as to the existence of “Cause” shall be
conclusive on the Participant and the Company.




(g) “Change in Control” means and includes the occurrence of any one of the
following events:




(i) individuals who, on the Plan Effective Date, constitute the Board (the
“Incumbent Directors”) cease for any reason to constitute at least a majority of
such Board; provided, that any person becoming a director after the Plan Effective
Date and whose election or nomination for election was approved by a vote of at least a
majority of the Incumbent Directors then on the Board shall be an Incumbent Director;
provided, however, that no individual initially elected or nominated as a
director of the Company as a result of an actual or threatened election contest with
respect to the election or removal of directors (“Election Contest”) or other
actual or threatened solicitation of proxies or consents by or on behalf of any Person
other than the Board (“Proxy Contest”), including by reason of any agreement
intended to avoid or settle any Election Contest or Proxy Contest, shall be deemed an
Incumbent Director; or




(ii) any Person becomes a Beneficial Owner, directly or indirectly, of either (A) 35%
or more of the then-outstanding shares of common stock of the Company (“Company Common
Stock”) or (B) securities of the Company representing 35% or more of the combined
voting power of the Company’s then outstanding securities eligible to vote for the
election of directors (the “Company Voting Securities”); provided,
further, that for purposes of this subsection (ii), the following acquisitions of
Company Common Stock or Company Voting Securities shall not constitute a Change in
Control: (w) an acquisition directly from the Company, (x) an acquisition by the Company
or a Subsidiary, (y) an acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any Subsidiary, or (z) an acquisition pursuant
to a Non-Qualifying Transaction (as defined in subsection (iii) below); or




(iii) the consummation of a reorganization, merger, consolidation, statutory share
exchange or similar form of corporate transaction involving the Company or a Subsidiary (a
“Reorganization”), or the sale or other disposition of all or substantially all of
the Company’s assets (a “Sale”) or the acquisition of assets or stock of another
corporation or other entity (an “Acquisition”), unless immediately following such
Reorganization, Sale or Acquisition: (A) all or substantially all of the individuals and
entities who were the Beneficial Owners, respectively, of the outstanding Company Common
Stock and outstanding Company Voting Securities immediately prior to such Reorganization,
Sale or Acquisition beneficially own, directly or indirectly, more than 35% of,
respectively, the then outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the entity resulting from such Reorganization, Sale or
Acquisition (including, without limitation, an entity which as a result of such
transaction owns the Company or all or substantially all of the Company’s assets or stock
either directly or through one or more subsidiaries, the “Surviving Entity”) in
substantially the same proportions as their ownership, immediately prior to such
Reorganization, Sale or Acquisition, of the outstanding Company Common Stock and the
outstanding Company Voting Securities, as the case may be, and (B) no Person (other than
(x) the Company or any Subsidiary, (y) the Surviving Entity or its ultimate parent entity,
or (z) any employee benefit plan (or related trust) sponsored or maintained by any of the
foregoing) is the Beneficial Owner, directly or indirectly, of 35% or more of the total
common stock or 35% or more of the total voting power of the outstanding voting securities
eligible to elect directors of the Surviving Entity, and (C) at least a majority of the
members of the board of directors of the Surviving Entity were Incumbent Directors at the
time of the Board’s approval of the execution of the initial agreement providing for such
Reorganization, Sale or Acquisition (any Reorganization, Sale or Acquisition which
satisfies all of the criteria specified in (A), (B) and (C) above shall be deemed to be a
“Non-Qualifying Transaction”); or



 




(iv) approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.




(h) “Charter” means the articles of incorporation of the Company, as such articles
of incorporation may be amended from time to time.




(i) “Code” means the Internal Revenue Code of 1986, as amended from time to time.
For purposes of this Plan, references to sections of the Code shall be deemed to include
references to any applicable regulations thereunder and any successor or similar provision.




(j) “Committee” means the committee of the Board described in Article 4.




(k) “Company” means Independence Realty Trust, Inc., a Maryland corporation, or
any successor corporation.




(l) “Continuous Status as a Participant” means the absence of any interruption or
termination of service as an employee, officer, director, trustee, consultant or advisor of the
Company or any Affiliate, as applicable; provided, however, that for purposes
of an Incentive Stock Option “Continuous Status as a Participant” means the absence of any
interruption or termination of service as an employee of the Company or any Parent or
Subsidiary, as applicable, pursuant to applicable tax regulations. Continuous Status as a
Participant shall not be considered interrupted in the following cases: (i) a Participant
transfers employment between the Company and an Affiliate or between Affiliates, or (ii) in the
discretion of the Committee as specified at or prior to such occurrence, in the case of a
spin-off, sale or disposition of the Participant’s employer from the Company or any Affiliate,
or (iii) any leave of absence authorized in writing by the Company prior to its commencement;
provided, however, that for purposes of Incentive Stock Options, no such leave
may exceed 90 days, unless reemployment upon expiration of such leave is guaranteed by statute
or contract. If reemployment upon expiration of a leave of absence approved by the Company is
not so guaranteed, on the 91st day of such leave any Incentive Stock Option held by the
Participant shall cease to be treated as an Incentive Stock Option and shall be treated for tax
purposes as a Nonstatutory Stock Option. Whether military, government or other service or other
leave of absence shall constitute a termination of Continuous Status as a Participant shall be
determined in each case by the Committee at its discretion, and any determination by the
Committee shall be final and conclusive.




(m) “Deferred Stock Unit” means a right granted to a Participant under Article 9
to receive Shares (or the equivalent value in cash or other property if the Committee so
provides) at a future time as determined by the Committee, or as determined by the Participant
within guidelines established by the Committee in the case of voluntary deferral elections.




(n) “Disability” of a Participant means that the Participant (i) is unable to
engage in any substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months, or (ii) is, by reason of any medically
determinable physical or mental impairment which can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an accident and health
plan covering employees of the Participant’s employer. If the determination of Disability
relates to an Incentive Stock Option, Disability means Permanent and Total Disability as
defined in Section 22(e)(3) of the Code. In the event of a dispute, the determination of
whether a Participant is Disabled will be made by the Committee and may be supported by the
advice of a physician competent in the area to which such Disability relates.




(o) “Dividend Equivalent” means a right granted to a Participant under Article 11.




(p) “Eligible Participant” means an employee, officer, consultant, director,
trustee, consultant or advisor of the Company or any Affiliate.




(q) “Exchange” means any national securities exchange on which the Stock may from
time to time be listed or traded.



 




(r) “Fair Market Value,” on any date, means (i) if the Stock is listed on a
securities exchange, the closing sales price on such exchange or over such system on such date
or, in the absence of reported sales on such date, the closing sales price on the immediately
preceding date on which sales were reported, or (ii) if the Stock is not listed on a securities
exchange, the mean between the bid and offered prices as quoted by the applicable interdealer
quotation system for such date, provided that if the Stock is not quoted on such interdealer
quotation system or it is determined that the fair market value is not properly reflected by
such quotations, Fair Market Value will be determined by such other method as the Committee
determines in good faith to be reasonable and in compliance with Code Section 409A.




(s) “Grant Date” of an Award means the first date on which all necessary corporate
action has been taken to approve the grant of the Award as provided in the Plan, or such later
date as is determined and specified as part of that authorization process. Notice of the grant
shall be provided to the grantee within a reasonable time after the Grant Date.




(t) “Incentive Stock Option” means an Option that is intended to be an incentive
stock option and meets the requirements of Section 422 of the Code or any successor provision
thereto.




(u) “Nonstatutory Stock Option” means an Option that is not an Incentive Stock
Option.




(v) “Operating Partnership” means Independence Realty Operating Partnership, LP, a
Delaware limited partnership of which the Company is the sole general partner.




(w) “OP Interests” means limited partnership interests in the Operating
Partnership that may be exchanged or redeemed for Shares on a one-for-one basis, or any profits
interest in the Operating Partnership that may be exchanged or converted into such limited
partnership interests.




(x) “Option” means a right granted to a Participant under Article 7 of the Plan to
purchase Stock at a specified price during specified time periods. An Option may be either an
Incentive Stock Option or a Nonstatutory Stock Option.




(y) “Other Award” means a right granted to a Participant under Article 12.




(z) “Parent” means a corporation, limited liability company, partnership or other
entity which owns or beneficially owns a majority of the outstanding voting stock or voting
power of the Company. Notwithstanding the above, with respect to an Incentive Stock Option,
Parent shall have the meaning set forth in Section 424(e) of the Code.




(aa) “Participant” means a person who, as an employee, officer, director, trustee,
consultant or advisor of the Company or any Affiliate, has been granted an Award under the
Plan; provided that in the case of the death of a Participant, the term “Participant” refers to
a beneficiary designated pursuant to Section 13.4 or the legal guardian or other legal
representative acting in a fiduciary capacity on behalf of the Participant under applicable
state law and court supervision.




(bb) “Performance Award” means any award granted under the Plan pursuant to
Article 10.




(cc) “Person” means any individual, entity or group, within the meaning of
Section 3(a)(9) of the 1934 Act and as used in Section 13(d)(3) or 14(d)(2) of the 1934 Act.




(dd) “Plan” means the Independence Realty Trust, Inc. 2016 Long Term Incentive
Plan, as amended from time to time.




(ee) “Plan Effective Date” has the meaning assigned such term in Section 3.1.




(ff) “Restricted Stock” means Stock granted to a Participant under Article 9 that
is subject to certain restrictions and to risk of forfeiture.




(gg) “Restricted Stock Unit” means a right granted to a Participant under Article
9 to receive shares of Stock (or the equivalent value in cash or other property if the
Committee so provides) in the future, which right is subject to certain restrictions and to
risk of forfeiture.



 




(hh) “Shares” means shares of the Company’s Stock. If there has been an
adjustment or substitution pursuant to Section 14.1, the term “Shares” shall also include any
            shares of stock or other securities that are substituted for Shares or into which Shares are
adjusted pursuant to Section 14.1.




(ii) “Shares Award” is defined in Section 5.2.




(jj) “Stock” means the $0.01 par value common stock of the Company and such other
securities of the Company as may be substituted for Stock pursuant to Section 14.1.




(kk) “Stock Appreciation Right” or “SAR” means a right granted to a
Participant under Article 8 to receive a payment equal to the difference between the Fair
Market Value of a Share as of the date of exercise of the SAR over the grant price of the SAR,
all as determined pursuant to Article 8.




(ll) “Subsidiary” means any corporation, limited liability company, partnership or
other entity of which a majority of the outstanding voting stock or voting power is
beneficially owned directly or indirectly by the Company. Notwithstanding the above, with
respect to an Incentive Stock Option, Subsidiary shall have the meaning set forth in
Section 424(f) of the Code.




(mm) “1933 Act” means the Securities Act of 1933, as amended from time to time.




(nn) “1934 Act” means the Securities Exchange Act of 1934, as amended from time to
time.



ARTICLE 3

PLAN EFFECTIVE DATE; TERMINATION OF PLAN




3.1. PLAN EFFECTIVE DATE. The “Plan Effective Date” shall mean May 12, 2016.
The Plan initially became effective on April 6, 2011 and was amended and restated July 29, 2013.



3.2. TERMINATION OF PLAN. The Plan shall terminate on the tenth anniversary of the
Plan Effective Date unless earlier terminated as provided herein. The termination of the Plan on
such date shall not affect the validity of any Award outstanding on the date of termination, which
shall continue to be governed by the applicable terms and conditions of this Plan. Notwithstanding
the foregoing, no Incentive Stock Options may be granted more than ten (10) years after the Plan
Effective Date.



ARTICLE 4

ADMINISTRATION




4.1. COMMITTEE. The Plan shall be administered by the Compensation Committee appointed
by the Board (which Committee shall consist of at least two directors) or its successor or such
other committee of the Board to which the Board has delegated with authority to administer the Plan
or, at the discretion of the Board from time to time, the Plan may be administered by the Board.
The members of the Committee shall be appointed by, and may be changed at any time and from time to
time in the discretion of, the Board. It is intended that at least two of the directors appointed
to serve on the Committee shall be “non-employee directors” (within the meaning of Rule 16b-3
promulgated under the 1934 Act) and that any such members of the Committee who do not so qualify
shall abstain from participating in any decision to make or administer Awards that are made to
Eligible Participants who at the time of consideration for such Award are persons subject to the
short-swing profit rules of Section 16 of the 1934 Act. However, the mere fact that a Committee
member shall fail to qualify as a “non-employee director” or shall fail to abstain from such action
shall not invalidate any Award made by the Committee which Award is otherwise validly made under
the Plan. The Board may reserve to itself any or all of the authority and responsibility of the
Committee under the Plan or may act as administrator of the Plan for any and all purposes. To the
extent the Board has reserved any authority and responsibility or during any time that the Board is
acting as administrator of the Plan, it shall have all the powers of the Committee hereunder, and
any reference herein to the Committee (other than in this Section 4.1) shall include the Board. To
the extent any action of the Board under the Plan conflicts with actions taken by the Committee,
the actions of the Board shall control.



4.2. ACTION AND INTERPRETATIONS BY THE COMMITTEE. For purposes of administering the
Plan, the Committee may from time to time adopt rules, regulations, guidelines and procedures for
carrying out the provisions and purposes of the Plan and make such other determinations, not
inconsistent with the Plan, as the Committee may deem appropriate. The Committee’s interpretation
of the Plan, any Awards granted under the Plan, any Award Certificate and all decisions and
determinations by the Committee with respect to the Plan are final, binding, and conclusive on all
parties. Each member of the Committee is entitled to, in good faith, rely or act upon any report or
other information furnished to that member by any officer or other employee of the Company or any
Affiliate, the Company’s or an Affiliate’s independent certified public accountants, the Company’s
or an Affiliate’s counsel or any executive compensation consultant or other professional retained
by the Company or any Affiliate to assist in the administration of the Plan.



4.3. AUTHORITY OF COMMITTEE. The Committee has the exclusive power, authority and
discretion to:




(a) grant Awards;




(b) designate Participants;




(c) determine the type or types of Awards to be granted to each Participant;




(d) determine the number of Awards to be granted and the number of Shares, OP Interests or
dollar amount to which an Award will relate;




(e) determine the terms and conditions of any Award granted under the Plan;




(f) prescribe the form of each Award Certificate, which need not be identical for each
Participant;




(g) decide all other matters that must be determined in connection with an Award;




(h) establish, adopt or revise any rules, regulations, guidelines or procedures as it may
deem necessary or advisable to administer the Plan;




(i) make all other decisions and determinations that may be required under the Plan or as
the Committee deems necessary or advisable to administer the Plan;




(j) amend the Plan or any Award Certificate as provided herein; and




(k) adopt such modifications, procedures, and subplans as may be necessary or desirable to
comply with provisions of the laws of non-U.S. jurisdictions in which the Company or any
Affiliate may operate, in order to assure the viability of the benefits of Awards granted to
participants located in such other jurisdictions and to meet the objectives of the Plan.



4.4. AWARD CERTIFICATES. Each Award, other than an Award of Shares which are not
subject to any restrictions or conditions, shall be evidenced by an Award Certificate. Each Award
Certificate shall include such provisions, not inconsistent with the Plan, as may be specified by
the Committee.



ARTICLE 5

SHARES SUBJECT TO THE PLAN




5.1. NUMBER OF SHARES. Subject to adjustment as provided in Sections 5.2 and
Section 14.1, the aggregate number of Shares reserved and available for issuance pursuant to Awards
granted under the Plan shall be Four Million Three Hundred Thousand (4,300,000).



 



5.2. SHARE COUNTING. The number of Shares covered by an Award providing it will
be settled with the issuance of Shares in whole or in part (a “Shares Award”) shall be
subtracted from the Plan share reserve as of the date of grant, but shall be added back to the Plan
share reserve to the extent provided for in this Section 5.2(a) through Section 5.2(d) and
otherwise shall not be added back. For the avoidance of doubt: (i) Shares withheld from a Shares
Award or delivered by a Participant to satisfy minimum tax withholding requirements will not be
available for issuance pursuant to Awards granted under the Plan; (ii) If the exercise price of an
Option is satisfied by delivering Shares to the Company (by either actual delivery or attestation),
the number of Shares remaining available for issuance pursuant to Awards granted under the Plan
shall not be increased by the Shares so delivered (by delivery or attestation); and (iii) To the
extent that the full number of Shares subject to an Option or SAR is not issued upon exercise of
the Option or SAR for any reason, including by reason of net-settlement of such Option or SAR
(including a net settlement of a SAR that would be reported as a disposition of Shares to the
Company under Section 16 of the 1934 Act), the number of Shares remaining available for issuance
pursuant to Awards granted under the Plan shall not be increased by the Shares that were not so
issued. Shares covered by an Award which is not a Shares Award, including, without limitation, an
Award that provides that such Award may be settled solely in cash, shall not be subtracted from the
Plan share reserve at any time.




(a) To the extent that a Shares Award is canceled, terminates, expires, is forfeited or
lapses for any reason, any unissued or forfeited Shares subject to the Shares Award will again
be available for issuance pursuant to Awards granted under the Plan.




(b) Shares subject to Shares Awards settled in cash will again be available for issuance
pursuant to Awards granted under the Plan.




(c) To the extent that the full number of Shares subject to a Shares Award is not issued
by reason of failure to achieve maximum performance goals, only the number of Shares issued and
delivered shall be considered for purposes of determining the number of Shares remaining
available for issuance pursuant to Awards granted under the Plan.




(d) Substitute Awards granted pursuant to Section 13.10 of the Plan shall not count
against the Shares otherwise available for issuance under the Plan under Section 5.1.



5.3. STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award may consist, in
whole or in part, of authorized and unissued Stock, treasury Stock or Stock purchased on the open
market.



5.4 SHARE VALUATION. To the extent not otherwise provided for in the Plan or set by
the Committee with respect to an Award, for Awards settled with respect to the equivalent value of
Shares in cash or other property cash payments, such value shall be calculated based on the Fair
Market Value of the Shares to which the settlement relates on the relevant date of determination.



ARTICLE 6

ELIGIBILITY




6.1. ELIGIBILITY. Awards may be granted only to Eligible Participants. Incentive Stock
Options may be granted only to Eligible Participants who are employees of the Company or a Parent
or Subsidiary as defined in Section 424(e) and (f) of the Code. Eligible Participants who are
service providers to an Affiliate may be granted Options or SARs under this Plan only if the
Affiliate qualifies as an “eligible issuer of service recipient stock” within the meaning of
§1.409A-1(b)(5)(iii)(E) of the final regulations under Code Section 409A.



6.2 INDIVIDUAL LIMITATION. With respect to Shares Awards, the maximum aggregate number
of Shares with respect to which all such Shares Awards may be made under the Plan to any individual
during any calendar year shall be 500,000 Shares (subject to adjustment as described in Article 14
below). This limitation shall not apply to Awards that are not Shares Awards, including, without
limitation, Awards that provide they may be settled solely with the equivalent value in cash or
other property and may not be settled with Shares.



 



ARTICLE 7

STOCK OPTIONS




7.1. GENERAL. The Committee is authorized to grant Options to Participants on the
following terms and conditions:




(a) EXERCISE PRICE. The exercise price per Share under an Option shall be
determined by the Committee, provided that the exercise price for any Option (other than an
Option issued as a substitute Award pursuant to Section 13.10) shall not be less than the Fair
Market Value as of the Grant Date.




(b) TIME AND CONDITIONS OF EXERCISE. The Committee shall determine the time or
times at which an Option may be exercised in whole or in part, subject to Section 7.1(d). The
Committee shall also determine the performance or other conditions, if any, that must be
satisfied before all or part of an Option may be exercised or vested.




(c) PAYMENT. The Committee shall determine the methods by which the exercise price
of an Option may be paid, the form of payment, including, without limitation, cash, Shares, or
other property (including “cashless exercise” arrangements), and the methods by which Shares
shall be delivered or deemed to be delivered to Participants.




(d) EXERCISE TERM. Except for Nonstatutory Options granted to Participants outside
the United States, no Option granted under the Plan shall be exercisable for more than ten
years from the Grant Date.




(e) NO DEFERRAL FEATURE. No Option shall provide for any feature for the deferral
of compensation other than the deferral of recognition of income until the exercise or
disposition of the Option.




(f) NO DIVIDEND EQUIVALENTS. No Option shall provide for Dividend Equivalents.



7.2. INCENTIVE STOCK OPTIONS. The terms of any Incentive Stock Options granted under
the Plan must comply with the requirements of Section 422 of the Code. If all of the requirements
of Section 422 of the Code are not met, the Option shall automatically become a Nonstatutory Stock
Option.



ARTICLE 8

STOCK APPRECIATION RIGHTS




8.1. GRANT OF STOCK APPRECIATION RIGHTS. The Committee is authorized to grant Stock
Appreciation Rights to Participants on the following terms and conditions:




(a) RIGHT TO PAYMENT. Upon the exercise of a SAR, the Participant to whom it is
granted has the right to receive, for each Share with respect to which the SAR is being
exercised, the excess, if any, of:




(1) The Fair Market Value of one Share on the date of exercise; over




(2) The base price of the SAR as determined by the Committee, which shall not be less
than the Fair Market Value of one Share on the Grant Date.




(b) EXERCISE TERM. Except for SARs granted to Participants outside the United
States, no SAR shall be exercisable for more than ten years from the Grant Date.




(c) NO DEFERRAL FEATURE. No SAR shall provide for any feature for the deferral of
compensation other than the deferral of recognition of income until the exercise or disposition
of the SAR.




(d) NO DIVIDEND EQUIVALENTS. No SAR shall provide for Dividend Equivalents.




(e) OTHER TERMS. All SARs shall be evidenced by an Award Certificate. Subject to
the limitations of this Article 8, the terms, methods of exercise, methods of settlement, form
of consideration payable in settlement, and any other terms and conditions of any SAR shall be
determined by the Committee at the time of the grant of the Award and shall be reflected in the
Award Certificate.



 



ARTICLE 9

RESTRICTED STOCK, RESTRICTED STOCK UNITS

AND DEFERRED STOCK UNITS




9.1. GRANT OF RESTRICTED STOCK, RESTRICTED STOCK UNITS AND DEFERRED STOCK UNITS. The
Committee is authorized to make Awards of Restricted Stock, Restricted Stock Units or Deferred
Stock Units to Participants in such amounts and subject to such terms and conditions as may be
selected by the Committee. An Award of Restricted Stock, Restricted Stock Units or Deferred Stock
Units shall be evidenced by an Award Certificate setting forth the terms, conditions, and
restrictions applicable to the Award.



9.2. ISSUANCE AND RESTRICTIONS. Restricted Stock, Restricted Stock Units or Deferred
Stock Units shall be subject to such restrictions on transferability and other restrictions as the
Committee may impose (including, without limitation, limitations on the right to vote Restricted
Stock or the right to receive dividends on the Restricted Stock). These restrictions may lapse
separately or in combination at such times, under such circumstances, in such installments, upon
the satisfaction of performance goals or otherwise, as the Committee determines at the time of the
grant of the Award or thereafter. Except as otherwise provided in an Award Certificate or any
special Plan document governing an Award, the Participant shall have all of the rights of a
stockholder with respect to an Award of Restricted Stock, and the Participant shall have none of
the rights of a stockholder with respect to an Award of Restricted Stock Units or Deferred Stock
Units until such time as Shares of Stock are paid in settlement of the Restricted Stock Units or
Deferred Stock Units. Unless otherwise provided in the applicable Award Certificate, awards of
Restricted Stock will be entitled to full dividend rights and any dividends paid thereon will be
paid or distributed to the holder no later than the end of the calendar year in which the dividends
are paid to stockholders or, if later, the 15th day of the third month following the date the
dividends are paid to stockholders.



9.3. FORFEITURE. Except as otherwise determined by the Committee at the time of the
grant of the Award or thereafter, upon termination of Continuous Status as a Participant during the
applicable restriction period or upon failure to satisfy a performance goal during the applicable
restriction period, Restricted Stock or Restricted Stock Units that are at that time subject to
restrictions shall be forfeited.



9.4. DELIVERY OF RESTRICTED STOCK. Shares of Restricted Stock shall be delivered to
the Participant at the time of grant either by book-entry registration or by delivering to the
Participant, or a custodian or escrow agent (including, without limitation, the Company, any
Affiliate or one or more of their respective officers and employees) designated by the Committee, a
stock certificate or certificates registered in the name of the Participant. If physical
certificates representing shares of Restricted Stock are registered in the name of the Participant,
such certificates must bear an appropriate legend referring to the terms, conditions, and
restrictions applicable to such Restricted Stock.



ARTICLE 10

PERFORMANCE AWARDS




10.1. GRANT OF PERFORMANCE AWARDS. The Committee is authorized to grant any Award
under this Plan, including cash-based Awards, with performance-based vesting criteria, on such
terms and conditions as may be selected by the Committee. The Committee shall have the complete
discretion to determine the number of Performance Awards granted to each Participant and to
designate the provisions of such Performance Awards as provided in Section 4.3. All Performance
Awards shall be evidenced by an Award Certificate or a written program established by the
Committee, pursuant to which Performance Awards are awarded under the Plan under uniform terms,
conditions and restrictions set forth in such written program.



10.2 PERFORMANCE GOALS. When Awards that are to be considered “qualified
performance-based compensation” are granted, the Committee shall establish in writing (a) the
objective performance goals that must be met, (b) the period during which performance will be
measured, (c) the maximum amounts that may be paid if the performance goals are met, and (d) any
other conditions that the Committee deems appropriate and consistent with the Plan and the
requirements of section 162(m) of the Code for “qualified performance-based compensation.” The
performance goals shall satisfy the requirements for “qualified performance-based compensation,”
including the requirement that the achievement of the goals be substantially uncertain at the time
they are established and that the performance goals be established in such a way that a third party
with knowledge of the relevant facts could determine whether and to what extent the performance
goals have been met. The Committee shall not have discretion to increase the amount of compensation
that is payable upon achievement of the designated performance goals, but the Committee may reduce
the amount of compensation that is payable upon achievement of the designated performance goals.



10.3 CRITERIA USED FOR OBJECTIVE PERFORMANCE GOALS. The Committee shall use
objectively determinable performance goals based on one or more of the criteria listed in
Exhibit A hereto.



ARTICLE 11

DIVIDEND EQUIVALENTS




11.1. GRANT OF DIVIDEND EQUIVALENTS. Except as provided in Sections 7.1(f) and 8.1(d),
the Committee is authorized to grant Dividend Equivalents with respect to Awards granted hereunder,
subject to such terms and conditions as may be selected by the Committee. Dividend Equivalents
shall entitle the Participant to receive payments equal to dividends with respect to all or a
portion of the number of Shares subject to an Award, as determined by the Committee. The Committee
may provide that Dividend Equivalents be paid or distributed when accrued or be deemed to have been
reinvested in additional Shares, or otherwise reinvested. Unless otherwise provided in the
applicable Award Certificate, Dividend Equivalents will be paid or distributed no later than the
15th day of the third month following the later of (i) the calendar year in
which the corresponding dividends were paid to stockholders, or (ii) the first calendar year in
which the Participant’s right to such Dividends Equivalents is no longer subject to a substantial
risk of forfeiture.



ARTICLE 12

OTHER AWARDS




12.1. GRANT OF OTHER AWARDS. The Committee is authorized, subject to limitations under
applicable law, to grant to Participants such other Awards that are payable in, valued in whole or
in part by reference to, or otherwise based on or related to Shares, as deemed by the Committee to
be consistent with the purposes of the Plan, including without limitation, OP Interests, membership
interests in a Subsidiary or operating partnership, Shares not subject to any restrictions or
conditions, convertible or exchangeable debt securities, other rights convertible or exchangeable
into Shares, and Awards valued by reference to book value of Shares or the value of securities of
or the performance of specified Parents or Subsidiaries. The Committee shall determine the terms
and conditions of such Awards. For purposes of calculating the number of Shares underlying an Other
Award that is specifically payable in whole or in part in Shares, relative to the total number of
Shares of Stock reserved and available for issuance under Section 5.1 hereof, the Committee shall
establish under Section 5.2 the maximum number of Shares to which a grantee of such Other Award may
be entitled upon fulfillment of all applicable conditions set forth in the relevant Award
Certificate, including vesting, accretion factors, conversion ratios, exchange ratios, performance
criteria and the like. If and when any such conditions are no longer capable of being met, in whole
or in part, the number of Shares underlying such Other Award to the extent previously reserved
under Section 5.2 shall be reduced accordingly by the Committee and the related Shares shall be
added back to the Shares of Stock available for issuance under the Plan. The Committee may require
that Other Awards be held through a limited partnership, or similar “look-through” entity, and the
Committee may require such limited partnership or similar entity to impose restrictions on its
partners or other beneficial owners that are not inconsistent with the provisions of this
Section 12.1. The provisions of the grant of Other Awards need not be the same with respect to each
Participant.



 



ARTICLE 13

PROVISIONS APPLICABLE TO AWARDS




13.1. TERM OF AWARD. The term of each Award shall be for the period as determined by
the Committee, provided that in no event shall the term of any Option or a Stock Appreciation Right
exceed a period of ten years from its Grant Date.



13.2. FORM OF PAYMENT FOR AWARDS. At the discretion of the Committee, payment of
Awards may be made in cash, Stock, a combination of cash and Stock, or any other form of property
as the Committee shall determine. In addition, payment of Awards may include such terms,
conditions, restrictions and/or limitations, if any, as the Committee deems appropriate, including,
in the case of Awards paid in the form of Stock, restrictions on transfer and forfeiture
provisions. Further, payment of Awards may be made in the form of a lump sum, or in installments,
as determined by the Committee.



13.3. LIMITS ON TRANSFER. No right or interest of a Participant in any unexercised or
restricted Award may be pledged, encumbered, or hypothecated to or in favor of any party other than
the Company or an Affiliate, or shall be subject to any lien, obligation, or liability of such
Participant to any other party other than the Company or an Affiliate. No unexercised or restricted
Award shall be assignable or transferable by a Participant other than by will or the laws of
descent and distribution; provided, however, that the Committee may (but need not)
permit other transfers (other than transfers for value) where the Committee concludes that such
transferability (i) does not result in accelerated taxation, (ii) does not cause any Option
intended to be an Incentive Stock Option to fail to be described in Code Section 422(b), and
(iii) is otherwise appropriate and desirable, taking into account any factors deemed relevant,
including without limitation, state or federal tax or securities laws applicable to transferable
Awards.



13.4. BENEFICIARIES. Notwithstanding Section 13.3, a Participant may, in the manner
determined by the Committee, designate a beneficiary to exercise the rights of the Participant and
to receive any distribution with respect to any Award upon the Participant’s death. A beneficiary,
legal guardian, legal representative, or other person claiming any rights under the Plan is subject
to all terms and conditions of the Plan and any Award Certificate applicable to the Participant,
except to the extent the Plan and Award Certificate otherwise provide, and to any additional
restrictions deemed necessary or appropriate by the Committee. If no beneficiary has been
designated or survives the Participant, payment shall be made to the Participant’s estate. Subject
to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time
provided the change or revocation is filed with the Committee.



13.5. STOCK TRADING RESTRICTIONS. All Stock issuable under the Plan is subject to any
stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply
with federal or state securities laws, rules and regulations and the rules of any national
securities exchange or automated quotation system on which the Stock is listed, quoted, or traded.
The Committee may place legends on any Stock certificate or issue instructions to the transfer
agent to reference restrictions applicable to the Stock.



13.6. ACCELERATION UPON DEATH OR DISABILITY. Except as otherwise provided in the Award
Certificate or any special Plan document governing an Award, upon the termination of a person’s
Continuous Status as a Participant by reason of death or Disability:




(i) all of that Participant’s outstanding Options and SARs shall become fully exercisable;




(ii) all time-based vesting restrictions on that Participant’s outstanding Awards shall
lapse as of the date of termination; and




(iii) the payout opportunities attainable under all of that Participant’s outstanding
performance-based Awards shall be deemed to have been fully earned as of the date of
termination as follows:




(A) if the date of termination occurs during the first half of the applicable
performance period, all relevant performance goals will be deemed to have been achieved at
the “target” level, and



 




(B) if the date of termination occurs during the second half of the applicable
performance period, the actual level of achievement of all relevant performance goals
against target will be measured as of the end of the calendar quarter immediately
preceding the date of termination, and




(C) in either such case, there shall be a pro rata payout to the Participant or his
or her estate within sixty (60) days following the date of termination (unless a later
date is required by Section 16.3 hereof), based upon the length of time within the
performance period that has elapsed prior to the date of termination.



To the extent that this provision causes Incentive Stock Options to exceed the dollar
limitation set forth in Code Section 422(d), the excess Options shall be deemed to be Nonstatutory
Stock Options.



13.7. ACCELERATION UPON A CHANGE IN CONTROL. Except as otherwise provided in the Award
Certificate or any special Plan document governing an Award, upon the occurrence of a Change in
Control, (i) all outstanding Options, SARs, and other Awards in the nature of rights that may be
exercised shall become fully exercisable, and (ii) all time-based vesting restrictions on
outstanding Awards shall lapse. Except as otherwise provided in the Award Certificate or any
special Plan document governing an Award, upon the occurrence of a Change in Control, the target
payout opportunities attainable under all outstanding performance-based Awards shall be deemed to
have been fully earned as of the effective date of the Change in Control based upon an assumed
achievement of all relevant performance goals at the “target” level and there shall be a pro rata
payout to Participants within thirty (30) days following the effective date of the Change in
Control based upon the length of time within the performance period that has elapsed prior to the
Change in Control.



13.8. ACCELERATION FOR ANY REASON. The Committee may in its sole discretion at any
time determine that all or a portion of a Participant’s Options, SARs, and other Awards in the
nature of rights that may be exercised shall become fully or partially exercisable, that all or a
part of the time-based vesting restrictions on all or a portion of the outstanding Awards shall
lapse, and/or that any performance-based criteria with respect to any Awards shall be deemed to be
wholly or partially satisfied, in each case, as of such date as the Committee may, in its sole
discretion, declare. The Committee may discriminate among Participants and among Awards granted to
a Participant in exercising its discretion pursuant to this Section 13.8. Notwithstanding anything
in the Plan, including this Section 13.8, the Committee may not accelerate the payment of any Award
if such acceleration would violate Section 409A(a)(3) of the Code.



13.9. FORFEITURE EVENTS. The Committee may specify in an Award Certificate that the
Participant’s rights, payments and benefits with respect to an Award shall be subject to reduction,
cancellation, forfeiture or recoupment upon the occurrence of certain specified events, in addition
to any otherwise applicable vesting or performance conditions of an Award. Such events shall
include, but shall not be limited to, termination of employment for Cause, violation of material
Company or Affiliate policies, breach of noncompetition, confidentiality or other restrictive
covenants that may apply to the Participant, or other conduct by the Participant that is
detrimental to the business or reputation of the Company or any Affiliate.



13.10. SUBSTITUTE AWARDS. The Committee may grant Awards under the Plan in
substitution for stock and stock-based awards held by employees of another entity who become
employees of the Company or an Affiliate as a result of a merger or consolidation of the former
employing entity with the Company or an Affiliate or the acquisition by the Company or an Affiliate
of property or stock of the former employing corporation. The Committee may direct that the
substitute awards be granted on such terms and conditions as the Committee considers appropriate in
the circumstances.



13.11 NO REPRICING. Notwithstanding any provision herein to the contrary, the
repricing of Options or SARs is prohibited without prior approval of the Company’s stockholders.
For this purpose, a “repricing” means any of the following (or any other action that has the same
effect as any of the following): (A) changing the terms of an Option or SAR to lower its exercise
price or grant price; (B) any other action that is treated as a “repricing” under generally
accepted accounting principles; and (C) repurchasing for cash or canceling an Option or SAR at a
time when its exercise price or grant price is greater than the Fair Market Value of the underlying
Shares in exchange for another Award, unless the cancellation and exchange occurs in connection
with a change in capitalization or similar change under Section 14.1 below. Such cancellation and
exchange would be considered a “repricing” regardless of whether it is treated as a “repricing”
under generally accepted accounting principles and regardless of whether it is voluntary on the
part of the Participant.



ARTICLE 14

CHANGES IN CAPITAL STRUCTURE




14.1. MANDATORY ADJUSTMENTS. In the event of a nonreciprocal transaction between the
Company and its stockholders that causes the per-share value of the Stock to change (including,
without limitation, any stock dividend, stock split, spin-off, rights offering, or large
nonrecurring cash dividend), the authorization limits under Section 5.1 shall be adjusted
proportionately, and the Committee shall make such adjustments to the Plan and Awards as it deems
necessary, in its sole discretion, to prevent dilution or enlargement of rights immediately
resulting from such transaction. Action by the Committee may include: (i) adjustment of the number
and kind of shares that may be delivered under the Plan; (ii) adjustment of the number and kind of
shares subject to outstanding Awards; (iii) adjustment of the exercise price of outstanding Awards
or the measure to be used to determine the amount of the benefit payable on an Award; and (iv) any
other adjustments that the Committee determines to be equitable. Notwithstanding the foregoing, the
Committee shall not make any adjustments to outstanding Options or SARs that would constitute a
modification or substitution of the stock right under Treas. Reg. Sections 1.409A-1(b)(5)(v) that
would be treated as the grant of a new stock right or change in the form of payment for purposes of
Code Section 409A. Without limiting the foregoing, in the event of a subdivision of the outstanding
Stock (stock split), a declaration of a dividend payable in Shares, or a combination or
consolidation of the outstanding Stock into a lesser number of Shares, the authorization limits
under Section 5.1 shall automatically be adjusted proportionately, and the Shares then subject to
each Award shall automatically, without the necessity for any additional action by the Committee,
be adjusted proportionately without any change in the aggregate purchase price therefor.



14.2. DISCRETIONARY ADJUSTMENTS. Upon the occurrence or in anticipation of any
corporate event or transaction involving the Company (including, without limitation, any merger,
reorganization, recapitalization, combination or exchange of shares, or any transaction described
in Section 14.1), the Committee may, in its sole discretion, provide (i) that Awards will be
settled in cash rather than Stock, (ii) that Awards will become immediately vested and exercisable
and will expire after a designated period of time to the extent not then exercised, (iii) that
Awards will be assumed by another party to a transaction or otherwise be equitably converted or
substituted in connection with such transaction, (iv) that outstanding Awards may be settled by
payment in cash or cash equivalents equal to the excess of the Fair Market Value of the underlying
Stock, as of a specified date associated with the transaction, over the exercise price of the
Award, (v) that performance targets and performance periods for Performance Awards will be
modified, or (vi) any combination of the foregoing. The Committee’s determination need not be
uniform and may be different for different Participants whether or not such Participants are
similarly situated.



14.3. GENERAL. Any discretionary adjustments made pursuant to this Article 14 shall be
subject to the provisions of Section 15.2. To the extent that any adjustments made pursuant to this
Article 14 cause Incentive Stock Options to cease to qualify as Incentive Stock Options, such
Options shall be deemed to be Nonstatutory Stock Options.



ARTICLE 15

AMENDMENT, MODIFICATION AND TERMINATION




15.1. AMENDMENT, MODIFICATION AND TERMINATION. The Board or the Committee may, at any
time and from time to time, amend, modify or terminate the Plan without stockholder approval;
provided, however, that if an amendment to the Plan would, in the reasonable
opinion of the Board or the Committee, either (i) materially increase the number of Shares
available under the Plan, (ii) expand the types of awards under the Plan, (iii) materially expand
the class of participants eligible to participate in the Plan, (iv) materially extend the term of
the Plan, or (v) otherwise constitute a material change requiring stockholder approval under
applicable laws, policies or regulations or the applicable listing or other requirements of an
Exchange, then such amendment shall be subject to stockholder approval; and provided,
further, that the Board or Committee may condition any other amendment or modification on
the approval of stockholders of the Company for any reason, including by reason of such approval
being necessary or deemed advisable (i) to comply with the listing or other requirements of an
Exchange, or (ii) to satisfy any other tax, securities or other applicable laws, policies or
regulations.



15.2. AWARDS PREVIOUSLY GRANTED. At any time and from time to time, the Committee may
amend, modify or terminate any outstanding Award without approval of the Participant;
provided, however:




(a) Subject to the terms of the applicable Award Certificate, such amendment, modification
or termination shall not, without the Participant’s consent, reduce or diminish the value of
such Award determined as if the Award had been exercised, vested, cashed in or otherwise
settled on the date of such amendment or termination (with the per-share value of an Option or
SAR for this purpose being calculated as the excess, if any, of the Fair Market Value as of the
date of such amendment or termination over the exercise or base price of such Award);




(b) The original term of an Option or SAR may not be extended without the prior approval
of the stockholders of the Company;




(c) Except as otherwise provided in Section 14.1, the exercise price of an Option or SAR
may not be reduced, directly or indirectly, without the prior approval of the stockholders of
the Company; and




(d) No termination, amendment, or modification of the Plan shall adversely affect any
Award previously granted under the Plan, without the written consent of the Participant
affected thereby. An outstanding Award shall not be deemed to be “adversely affected” by a Plan
amendment if such amendment would not reduce or diminish the value of such Award determined as
if the Award had been exercised, vested, cashed in or otherwise settled on the date of such
amendment (with the per-share value of an Option or SAR for this purpose being calculated as
the excess, if any, of the Fair Market Value as of the date of such amendment over the exercise
or base price of such Award).



15.3. COMPLIANCE AMENDMENTS. Notwithstanding anything in the Plan or in any Award
Certificate to the contrary, the Board may amend the Plan or an Award Certificate, to take effect
retroactively or otherwise, as deemed necessary or advisable for the purpose of conforming the Plan
or Award Certificate to any present or future law relating to plans of this or similar nature
(including, but not limited to, Section 409A of the Code), and to the administrative regulations
and rulings promulgated thereunder. By accepting an Award under this Plan, a Participant agrees to
any amendment made pursuant to this Section 15.3 to any Award granted under the Plan without
further consideration or action.



ARTICLE 16

GENERAL PROVISIONS




16.1. RIGHTS OF PARTICIPANTS.




(a) No Participant or any Eligible Participant shall have any claim to be granted any
Award under the Plan. Neither the Company, its Affiliates nor the Committee is obligated to
treat Participants or Eligible Participants uniformly, and determinations made under the Plan
may be made by the Committee selectively among Eligible Participants who receive, or are
eligible to receive, Awards (whether or not such Eligible Participants are similarly situated).




(b) Nothing in the Plan, any Award Certificate or any other document or statement made
with respect to the Plan, shall interfere with or limit in any way the right of the Company or
any Affiliate to terminate any Participant’s employment or status as an officer, or any
Participant’s service as a director, at any time, nor confer upon any Participant any right to
continue as an employee, officer, director, trustee, consultant or advisor of the Company or
any Affiliate, whether for the duration of a Participant’s Award or otherwise.




(c) Neither an Award nor any benefits arising under this Plan shall constitute an
employment contract with the Company or any Affiliate and, accordingly, subject to Article 15,
this Plan and the benefits hereunder may be terminated at any time in the sole and exclusive
discretion of the Committee without giving rise to any liability on the part of the Company or
any of its Affiliates.




(d) No Award gives a Participant any of the rights of a stockholder of the Company unless
and until Shares are in fact issued to such person in connection with such Award.



16.2. WITHHOLDING. The Company or any Affiliate shall have the authority and the right
to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to
satisfy federal, state, and local taxes (including the Participant’s FICA obligation) required by
law to be withheld with respect to any exercise, lapse of restriction or other taxable event
arising as a result of the Plan. With respect to withholding required upon any taxable event under
the Plan, the Committee may, at the time the Award is granted or thereafter, require or permit that
any such withholding requirement be satisfied, in whole or in part, by withholding from the Award
Shares having a Fair Market Value on the date of withholding equal to the minimum amount (and not
any greater amount) required to be withheld for tax purposes, all in accordance with such
procedures as the Committee establishes.



16.3. SPECIAL PROVISIONS RELATED TO SECTION 409A OF THE CODE.



(a) General. It is intended that the payments and benefits provided under the Plan and
any Award shall either be exempt from the application of, or comply with, the requirements of
Section 409A of the Code. The Plan and all Award Certificates shall be construed in a manner that
effects such intent. Nevertheless, the tax treatment of the benefits provided under the Plan or any
Award is not warranted or guaranteed. Neither the Company, its Affiliates nor their respective
directors, officers, employees or advisers shall be held liable for any taxes, interest, penalties
or other monetary amounts owed by any Participant or other taxpayer as a result of the Plan or any
Award.



(b) Definitional Restrictions. Notwithstanding anything in the Plan or in any Award
Certificate to the contrary, to the extent that any amount or benefit that would constitute
non-exempt “deferred compensation” for purposes of Section 409A of the Code would otherwise be
payable or distributable, or a different form of payment (e.g., lump sum or installment) would be
effected, under the Plan or any Award Certificate by reason of the occurrence of a Change in
Control, or the Participant’s Disability or separation from service, such amount or benefit will
not be payable or distributable to the Participant, and/or such different form of payment will not
be effected, by reason of such circumstance unless the circumstances giving rise to such Change in
Control, Disability or separation from service meet any description or definition of “change in
control event”, “disability” or “separation from service”, as the case may be, in Section 409A of
the Code and applicable regulations (without giving effect to any elective provisions that may be
available under such definition). This provision does not prohibit the vesting of any Award upon a
Change in Control, Disability or separation from service, however defined. If this provision
prevents the payment or distribution of any amount or benefit, such payment or distribution shall
be made on the next earliest payment or distribution date or event specified in the Award
Certificate that is permissible under Section 409A of the Code. If this provision prevents the
application of a different form of payment of any amount or benefit, such payment shall be made in
the same form as would have applied absent such designated event or circumstance.



(c) Allocation among Possible Exemptions. If any one or more Awards granted under the
Plan to a Participant could qualify for any separation pay exemption described in Treas. Reg.
Section 1.409A-1(b)(9), but such Awards in the aggregate exceed the dollar limit permitted for the
separation pay exemptions, the Company (acting through the Committee) shall determine which Awards
or portions thereof will be subject to such exemptions.



 



(d) Six-Month Delay in Certain Circumstances. Notwithstanding anything in the
Plan or in any Award Certificate to the contrary, if any amount or benefit that would constitute
non-exempt “deferred compensation” for purposes of Section 409A of the Code would otherwise be
payable or distributable under this Plan or any Award Certificate by reason of a Participant’s
separation from service during a period in which the Participant is a Specified Employee (as
defined below), then, subject to any permissible acceleration of payment by the Committee under
Treas. Reg. Section 1.409A-3(j)(4)(ii) (domestic relations order), (j)(4)(iii) (conflicts of
interest), or (j)(4)(vi) (payment of employment taxes):




(i) the amount of such non-exempt deferred compensation that would otherwise be payable
during the six-month period immediately following the Participant’s separation from service
will be accumulated through and paid or provided on the first day of the seventh month
following the Participant’s separation from service (or, if the Participant dies during such
period, within 30 days after the Participant’s death) (in either case, the “Required Delay
Period”), and




(ii) the normal payment or distribution schedule for any remaining payments or
distributions will resume at the end of the Required Delay Period.




For purposes of this Plan, the term “Specified Employee” has the meaning given such term
in Section 409A of the Code and the final regulations thereunder, provided,
however, that, as permitted in such final regulations, the Company’s Specified
Employees and its application of the six-month delay rule of 409A(a)(2)(B)(i) of the Code shall
be determined in accordance with rules adopted by the Board or any committee of the Board,
which shall be applied consistently with respect to all nonqualified deferred compensation
arrangements of the Company, including this Plan.



16.4. UNFUNDED STATUS OF AWARDS. The Plan is intended to be an “unfunded” plan for
incentive and deferred compensation. With respect to any payments not yet made to a Participant
pursuant to an Award, nothing contained in the Plan or any Award Certificate shall give the
Participant any rights that are greater than those of a general creditor of the Company or any
Affiliate. This Plan is not intended to be subject to ERISA.



16.5. RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan shall be taken into
account in determining any benefits under any pension, retirement, savings, profit sharing, group
insurance, welfare or benefit plan of the Company or any Affiliate unless provided otherwise in
such other plan.



16.6. EXPENSES. The expenses of administering the Plan shall be borne by the Company
and its Affiliates.



16.7. TITLES AND HEADINGS. The titles and headings of the Sections in the Plan are for
convenience of reference only, and in the event of any conflict, the text of the Plan, rather than
such titles or headings, shall control.



16.8. GENDER AND NUMBER. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall include the singular
and the singular shall include the plural.



16.9. FRACTIONAL SHARES. No fractional Shares shall be issued and the Committee shall
determine, in its discretion, whether cash shall be given in lieu of fractional Shares or whether
such fractional Shares shall be eliminated by rounding up or down.



16.10. GOVERNMENT AND OTHER REGULATIONS.




(a) Notwithstanding any other provision of the Plan, no Participant who acquires Shares
pursuant to the Plan may, during any period of time that such Participant is an affiliate of
the Company (within the meaning of the rules and regulations of the Securities and Exchange
Commission under the 1933 Act), sell such Shares, unless such offer and sale is made
(i) pursuant to an effective registration statement under the 1933 Act, which is current and
includes the Shares to be sold, or (ii) pursuant to an appropriate exemption from the
registration requirement of the 1933 Act, such as that set forth in Rule 144 promulgated under
the 1933 Act.



 




(b) Notwithstanding any other provision of the Plan, if at any time the Committee
shall determine that the registration, listing or qualification of the Shares covered by an
Award upon any Exchange or under any foreign, federal, state or local law or practice, or the
consent or approval of any governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of such Award or the purchase or receipt of
Shares thereunder, no Shares may be purchased, delivered or received pursuant to such Award
unless and until such registration, listing, qualification, consent or approval shall have been
effected or obtained free of any condition not acceptable to the Committee. Any Participant
receiving or purchasing Shares pursuant to an Award shall make such representations and
agreements and furnish such information as the Committee may request to assure compliance with
the foregoing or any other applicable legal requirements. The Company shall not be required to
issue or deliver any certificate or certificates for Shares under the Plan prior to the
Committee’s determination that all related requirements have been fulfilled. The Company shall
in no event be obligated to register any securities pursuant to the 1933 Act or applicable
state or foreign law or to take any other action in order to cause the issuance and delivery of
such certificates to comply with any such law, regulation or requirement.



16.11. GOVERNING LAW. To the extent not governed by federal law, the Plan and all
Award Certificates shall be construed in accordance with and governed by the laws of the State of
Maryland.



16.12. ADDITIONAL PROVISIONS. Each Award Certificate may contain such other terms and
conditions as the Committee may determine; provided that such other terms and conditions are not
inconsistent with the provisions of the Plan.



16.13. NO LIMITATIONS ON RIGHTS OF COMPANY. The grant of any Award shall not in any
way affect the right or power of the Company to make adjustments, reclassification or changes in
its capital or business structure or to merge, consolidate, dissolve, liquidate, sell or transfer
all or any part of its business or assets. The Plan shall not restrict the authority of the
Company, for proper corporate purposes, to draft or assume awards, other than under the Plan, to or
with respect to any person. If the Committee so directs, the Company may issue or transfer Shares
to an Affiliate, for such lawful consideration as the Committee may specify, upon the condition or
understanding that the Affiliate will transfer such Shares to a Participant in accordance with the
terms of an Award granted to such Participant and specified by the Committee pursuant to the
provisions of the Plan.



16.14. INDEMNIFICATION. Each person who is or shall have been a member of the
Committee or of the Board shall be indemnified and held harmless by the Company against and from
any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her
in connection with or resulting from any claim, action, suit, or proceeding to which he or she may
be a party or in which he or she may be involved by reason of any action taken or failure to act
under the Plan and against and from any and all amounts paid by him or her in settlement thereof,
with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such
action, suit, or proceeding against him or her, provided he or she shall give the Company an
opportunity, at its own expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf, unless such loss, cost, liability, or expense is a
result of his or her own willful misconduct or except as expressly provided by statute. The
foregoing right of indemnification shall not be exclusive of any other rights of indemnification to
which such persons may be entitled under the Company’s charter or bylaws, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or hold them harmless.



16.15. COMPANY POLICIES. All Awards under the Plan shall be subject to the applicable
provisions of any applicable clawback or recoupment policies, share trading policies and other
policies that may be approved by the Board or the Committee, as such policies may be in effect from
time to time



***




 



The foregoing is hereby acknowledged as being the Independent Realty Trust, Inc.
2016 Long Term Incentive Plan, as amended and restated through May 12, 2016.



 



	 
	INDEPENDENCE REALTY TRUST, INC.

By: /s/ James J. Sebra

	 

	Name: James J. Sebra

Title: Chief Financial Officer & Treasurer







Exhibit A




Performance Criteria




Earnings per Share


Total revenue


Total property operating expenses


Net operating income (“NOI”)


NOI margin


Earnings before interest, taxes, depreciation and amortization (“EBITDA”)


EBITDA before acquisition expenses (“Adjusted EBITDA”)


Net income available to Shares


Earnings (loss) per share – diluted


Funds from operations (“FFO”) per share – diluted


Core funds from operations (“CFFO”) per share – diluted


Dividends per share


Total gross assets (total assets plus accumulated depreciation)


Total number of properties


Total units


Average occupancy


Average monthly effective rent, per unit


Same store portfolio average occupancy


Same store portfolio average effective monthly rent


Same store portfolio NOI


Total debt


Market equity capitalization


Total market capitalization


Ratio of total debt tototal gross assets


Ratio of net debt to total market capitalization


Ratio of net debt to adjusted EBITDA


Interest coverage


Leverage


Property Dispositions


Property Acquisitions


Net earnings,


Operating earnings,


REIT taxable income,


Capital gains,


Capital losses,


Funds from operations,


Net asset value,


Enterprise value,


Market capitalization (of the Shares, any series of the Company’s preferred shares or any
combination of any or all classes or series of the Company’s equity securities),


Return on equity


Return on capital,


Return on assets,


Stockholder return,


Return on equity,


Growth in assets,


Unit volume,


Sales,


Market share,


Strategic business criteria consisting of one or more objectives based on meeting specific revenue
goals, market penetration goals, geographic business expansion goals, cost targets or goals
relating to acquisitions or divestitures.



The performance goals may relate to the Participant’s business unit or the performance of IRT,
a Subsidiary, a Parent, or Affiliate, an entity sponsored by IRT, or IRT and its Subsidiaries and
Affiliates as a whole, or any combination of the foregoing. For purposes of measuring the
performance goals, the goals may exclude any or all of the following, as determined by the
Committee at the time of establishing the performance goals: capital gains, capital losses, amounts
resulting from accounting changes, merger, acquisition or divestiture-related amounts,
non-recurring or special items or amounts resulting from restructuring, or any combination of the
foregoing. Performance goals need not be uniform as among Participants. Performance goals may be
measured against the prior year, any other time period, an absolute goal and/or relative to a peer
group or market index.