exv10w3






Exhibit 10.3




PROLOGIS

DEFERRED FEE PLAN FOR TRUSTEES

(As Amended and Restated Effective as of May 14, 2010)




     Section 1. History, Purpose and Effective Date. The ProLogis Deferred Fee
Plan for Trustees (formerly, the Security Capital Industrial Trust Deferred Fee Plan for Trustees,
the “Plan”) was established by ProLogis (the “Trust”) effective as of June 24, 1997 to provide
non-employee trustees of the Trust with the opportunity to defer receipt of compensation otherwise
payable to such Trustee by the Trust. The Plan is designed to aid the Trust in attracting and
retaining as members of its Board of Trustees (the “Board”) persons whose abilities, experience and
judgment can contribute to the well-being of the Trust. The Plan was amended and restated
effective as of December 31, 2008 to comply with the requirements of section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”). It is intended that the provisions of the Plan
conform to the requirements of section 409A of the Code and the Plan will be interpreted in all
respects in accordance with such requirements. To the extent that benefits under the Plan are paid
in the form of the Trust’s common shares of beneficial interest (“Common Shares”), the benefit
shall be treated as a benefit under the ProLogis 2006 Long-Term Incentive Plan (or a successor
thereto) (the “LTIP”).



     Section 2. Administration of the Plan. The Plan shall be administered by a
committee of the Board consisting of two or more members of such Board who are not also employees
of the Trust or any subsidiary of the Trust (the “Committee”), as designated by the Board in its
sole discretion. In the absence of such a designation, the Board shall act as the Committee. The
Committee shall conclusively interpret the provisions of the Plan and shall make all determinations
under the Plan. The Committee shall act by vote or written consent of a majority of its members.



     Section 3. Source of Benefits. The amount of any benefit payable under the
Plan shall be paid from the general assets of the Trust or from one or more trusts, the assets of
which are subject to the claims of the Trust’s general creditors; provided, however, that, except
as described below, nothing in this Plan shall require the Trust to establish any trust to provide
benefits under the Plan. No Participant (as described in Section 4) or other individual entitled
to benefits under the Plan shall have any right, title or interest whatsoever in any assets of the
Trust or any of its affiliates or to any investment reserves, accounts or funds that the Trust may
purchase, establish or accumulate to aid in providing the benefits under the Plan. Nothing
contained in the Plan and no action taken pursuant to its provisions shall create a trust or
fiduciary relationship of any kind between the Trust and any Participant or any other person.
Neither a Participant nor a beneficiary of a Participant shall acquire any interest greater than
that of an unsecured creditor of ProLogis. Notwithstanding the foregoing, in the event of a change
or potential change in the ownership or control of the Trust which, in the opinion of the Board,
could affect the payment of benefits hereunder, the Trust
shall take such actions as it deems appropriate to protect each Participant’s Accounts



 









 




(as defined in Section 6) under the Plan, including the establishment and funding of a trust to satisfy
the Trust’s obligations under the Plan, provided that the assets of any such trust shall be subject
to the claims of the Trust’s general creditors.




     Section 4. Eligibility. Any member of the Board who is not an employee of the
Trust or any affiliate thereof (an “Outside Trustee”) is eligible to become a “Participant” in the
Plan by completing and filing a Deferral Election (as defined in Section 5) in accordance with the
terms of the Plan.



     Section 5. Deferral Elections. Subject to such additional terms, conditions
and limitations as the Committee may from time to time impose and the terms and conditions of the
Plan, for any calendar year, an Outside Trustee may make an election to defer receipt of all or any
portion of the retainer and committee fees (collectively, “Fees”) otherwise payable to the Outside
Trustee for that calendar year by filing a “Deferral Election” with the Committee. Once made, an
Outside Trustee’s Deferral Election shall carry over to future calendar years unless the Outside
Trustee modifies or revokes the Deferral Election for future calendar years in accordance with the
terms of the Plan. Deferral Elections shall be in writing and shall be filed with the Committee at
such time and in such manner as the Committee shall provide; provided, however, that in no case
shall a Deferral Election be made later than December 31 (or such earlier date specified by the
Committee) of the year preceding the calendar year in which the Fees to which it relates would be
earned by the Outside Trustee based on services performed and shall be irrevocable with respect to
the calendar year to which it relates as of such December 31 or such earlier date specified by the
Committee. An Outside Trustee who first becomes elected or appointed to the Board subsequent to
January 1 of any calendar year may, by filing a Deferral Election within 30 days of his or her
initial election or appointment to the Board, elect to defer Fees earned for services performed
after his or her initial election or appointment to the Board and after the Deferral Election is
filed. Any Deferral Election filed in accordance with the preceding sentence shall become
irrevocable for the calendar year to which it relates as of the date on which it is filed with the
Committee.



     Section 6. Accounts. Subject to the provisions of the Plan, the following
“Accounts” shall be established in the name of each Participant:




	 	(a)	 	A “Phantom Share Account” which shall reflect the Fees, if any, which are
deferred by such Participant in accordance with the terms of the Plan that would
otherwise have been payable to the Participant in the form of the Common Shares and
dividends thereon.
	 
	 	(b)	 	A “Cash Account” which shall reflect the Fees, if any, which are deferred by
such Participant in accordance with the terms of the Plan that would otherwise have
been payable to the Participant in cash and the earnings attributable thereto.




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Accounts under the Plan shall be for recordkeeping purposes only. The Committee may establish such
subaccounts within each Account as the Committee determines appropriate to administer the Plan. A
Participant is always fully vested in the balance in his Accounts.




     Section 7. Accounting. The Accounts of each Participant shall be adjusted as
follows:




	 	(a)	 	As of the date on which Fees would otherwise be paid to a Participant:






	 	(i)	 	each Participant’s Phantom Share Account shall be credited with
that number of “share units” equal to the number of Common Shares, if any, that
the Participant elected to defer as of such date in accordance with his or her
Deferral Election; and
	 
	 	(ii)	 	each Participant’s Cash Account shall be credited with the
amount of cash Fees, if any, that the Participant elected to defer as of such
date in accordance his or her Deferral Election.






	 	(b)	 	As of the effective date of any distribution to the Participant in accordance
with the terms of the Plan:






	 	(i)	 	each Participant’s Phantom Share Account shall be debited with
the number of share units, if any, distributed to such Participant as of such
date from his or her Phantom Share Account; and
	 
	 	(ii)	 	each Participant’s Cash Account shall be debited with the
amount of cash, if any, distributed to such Participant as of such date from
his or her Cash Account.






	 	(c)	 	As of the effective date of any dividends payable with respect to the Common
Shares:






	 	(i)	 	If such dividend is payable in cash, the Participant’s Phantom
Share Account shall be credited with an additional number of share units equal
to (A) the cash dividend payable with respect to a Common Share, multiplied by
(B) the number of share units in the Participant’s Phantom Share Account, if
any, as of the applicable dividend record date, divided by (C) the Fair Market
Value (as defined below) of a Common Share on the dividend payment date.
	 
	 	(ii)	 	If such dividend is payable in Common Shares, the Participant’s
Phantom Share Account shall be credited with an additional number of share
units equal to (A) the number of shares distributed in the dividend with
respect to a Common Share, multiplied by (B)
the number of share units in the Participant’s Phantom Share Account, if
any, as of the applicable dividend record date.




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	 	(d)	 	As of the last day of each calendar quarter (and, if applicable, as of the day
immediately preceding the first Payment Date (as defined in Section 8) (each an
“Accounting Date”), the balance in the Participant’s Cash Account, if any, shall be
credited with interest, at the Investment Return Rate (defined below), compounded
quarterly. Interest shall be prorated on a daily basis according to the balance in the
Participant’s Account.





     For purposes of the Plan, the term “Fair Market Value” shall have the same meaning as under the
LTIP and the term “Investment Return Rate” means the Trust’s average borrowing rate for the
applicable calendar quarter.



     Section 8. Time and Form of Payment. Subject to the provisions of Sections 9
and 10 and 12, the following provisions of this Section 8, and the other terms and conditions of
the Plan, the following shall apply with respect to the distribution of a Participant’s Account:




	 	(a)	 	Payment of a Participant’s Account balances, determined as of the day before
Payment Date (as defined below) shall be made (or shall begin to be distributed) to the
Participant as of the permitted Payment Dates and in the permitted Payment Form (as
defined below), each as elected by the Participant in his first Deferral Election under
the Plan (or, with respect to any person who was a Participant in the Plan immediately
prior to the Effective Date, as elected in the Deferral Election on file with respect
to the Participant on December 31, 2008).
	 
	 	(b)	 	For purposes of the Plan, (i) permissible “Payment Forms” are (A) a lump sum
payment or (B) a series of annual or quarterly installments for a period not to exceed
ten years, and (ii) permissible “Payment Dates” are (A) a specified date, (B) the date
on which the Participant’s service as an Outside Trustee terminates for any reason (the
“Termination Date”), or (C) the earlier of a specified date or the Participant’s
Termination Date.
	 
	 	(c)	 	If no Payment Date is specified in a Participant’s first Deferral Election (or,
if applicable, the election on file as of December 31, 2008), the Participant shall be
deemed to have elected his or her Termination Date as the Payment Date. If no Payment
Form is specified in a Participant’s first Deferral Election (or, if applicable, the
election on file as of December 31, 2008), the Participant shall be deemed to have
elected a lump sum as the Payment Form. Payments under the Plan shall be made (or
shall begin) as soon as practicable (but in no event more than 30 days) after the
applicable Payment Date.
	 
	 	(d)	 	If payment of any portion of the Participant’s Account balance is to be made in
the form of installment payments, the installment payment for the
year in which the Payment Date occurs shall begin as soon as practicable (but not
more than 30 days) after the Participant’s Payment Date and any




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	 	 	 	subsequent annual
installments shall be paid in the calendar year following the calendar year in which
the Payment Date occurs (at such time during such year as determined by the
Committee). The amount of each installment payment shall be equal to the
Participant’s Account balance, determined as of the Accounting Date immediately
prior to the payment of the installment, divided by the number of installments
remaining to be made, including the then current installment.
	 
	 	(e)	 	Unless the Committee determines otherwise, share units shall be paid in the
form of Common Shares, with the Participant receiving one Common Share for each share
unit distributed (and cash equal to any fractional share unit). The amount in the
Participant’s Cash Account, if any, shall be paid in cash.






Notwithstanding any other provision of the Plan to the contrary, in all cases, whether a
Participant has had a Termination Date or other separation from service for purposes of the
Plan shall be determined in accordance with the requirements of section 409A of the Code
(and applicable guidance issued thereunder) relating to separations from service by applying
the applicable default provisions.



     Section 9. Changes to Form of Payment. From and after the Effective Date, a
Participant may change the Payment Date and/or Payment Form (including any Payment Date or Payment
Form established pursuant to a deemed election pursuant to Section 8) once during his period of
participation in the Plan after the Effective Date by filing an election with the Committee.
Notwithstanding any other provision of the Plan to the contrary, any such election to change the
Payment Date and/or Payment Form (a) shall not be effective until the date that is 12 months
following the date on which it is filed with the Committee and (b) shall be effective only if it is
filed with the Committee at least 12 months prior to the date on which payments are otherwise to be
made (or begin) under the Plan (i.e., the date on which the first payment of the Participant’s
Accounts is otherwise scheduled to begin pursuant to Section 8). If a Participant files an
effective change to the Payment Date and/or Payment Form pursuant to this Section 9, payment of the
Participant’s Account balance shall be distributed in accordance with the new payment election and
such payments shall be made (or shall commence) as soon as practicable (but in no event more than
30 days) after the date which is the fifth anniversary of the date on which payment was to commence
under the Participant’s prior Deferral Election (the “Deferred Commencement Date”). The amount of
each distribution that is payable on or after the Deferred Commencement Date shall be determined in
accordance with Section 8 by substituting the Deferred Commencement Date for the Payment Date in
such Section 8.



     Section 10. Unforeseeable Emergency. The Committee may, pursuant to rules
adopted by it and applied in a uniform manner, accelerate the date of distribution of a
Participant’s Accounts because of an unforeseeable emergency at any time.



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“Unforeseeable
Emergency” shall mean an unforeseeable, severe financial hardship to the Participant resulting from
(a) a sudden and unexpected illness or accident of the Participant or his dependent (as defined in
section 152(a) of the Code, without regard to section 152(b)(1), (b)(2) and (d)(1)(B) of the Code);
(b) loss of the Participant’s property due to casualty (including the need to rebuild a home
following damage to the home not otherwise covered by insurance); or (c) other similar
extraordinary and unforeseeable circumstances arising as a result of events beyond the control of
the Participant. Whether a Participant has an Unforeseeable Emergency shall be determined on the
relevant facts and circumstances of the applicable situation but, in any case, a distribution shall
not be considered to be on account of an Unforeseeable Emergency to the extent that the emergency
is or may be relieved through reimbursement or compensation from insurance or otherwise or by
liquidation of the Participant’s assets (to the extent that the liquidation of such assets would
not cause severe financial hardship). Distributions on account of an Unforeseeable Emergency shall
be limited to the amount reasonably necessary to satisfy the emergency need (including amounts
necessary to pay any federal, state, local or foreign income taxes or penalties reasonably
anticipated to result from the distribution). Distribution pursuant to this Section 10 of less
than the Participant’s entire interest in the Plan shall be made pro rata from his Accounts.
Subject to the foregoing, payment of any amount with respect to which a Participant has filed a
request under this Section 10 shall be made in a lump sum as soon as practicable (but in no event
more than 30 days) after approval of such request by the Committee.




     Section 11. Designation of Beneficiary. A Participant may designate a
beneficiary or beneficiaries which shall be effective upon filing written notice with the Secretary
of the Trust on the form provided for that purpose. If no beneficiary is designated, or if no
designated beneficiary survives the Participant, the beneficiary shall be the Participant’s estate.
If more than one beneficiary statement has been filed, the beneficiary or beneficiaries designated
in the statement bearing the most recent date shall be deemed the valid beneficiary or
beneficiaries.



     Section 12. Death of Participant or Beneficiary. In the event of a
Participant’s death before he or she has received the full value of his or her Accounts, the then
current value of the Participant’s Accounts shall be determined as of the Accounting Date
immediately following death and such amount shall be paid to the beneficiary or beneficiaries of
the deceased Participant as soon as practicable (but in no event more than 30 days) thereafter in a
lump sum.



     Section 13. Adjustments on Recapitalization. In the event of a corporate
transaction involving the Trust, the Committee shall adjust share units credited to Participants’
Accounts when an equitable adjustment is required to preserve the benefits or potential benefits
thereof and the Committee may adjust share units in other situations (including, without
limitation, any stock dividend, stock split,
extraordinary cash dividend, recapitalization, reorganization, merger, consolidation,
split-up, spin-off, sale of assets or subsidiaries, combination or exchange of shares). Action by
the Committee may include, in its sole discretion: (a) adjustment of the number and kind of



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shares
which may be delivered under the Plan; and (b) any other adjustments that the Committee determines
to be equitable.




     Section 14. Compliance with Securities and Other Laws. In no event shall the
Trust be required to issue Common Shares to any person in settlement of a Participant’s Account if
the issuance thereof would constitute a violation by either the Participant or the Trust of any
provision of any law or regulation of any governmental authority or any national securities
exchange. To the extent that the Plan provides for issuance of certificates to reflect the transfer
of Common Shares, the transfer of such Common Shares may be effected on a non-certificated basis,
to the extent not prohibited by applicable law or the rules of any stock exchange.



     Section 15. Assignability. No right to receive payments hereunder shall be
transferable or assignable by a Participant or a beneficiary, except by will or by the laws of
descent and distribution.



     Section 16. Amendment of Termination of Plan. This Plan may at anytime or
from time to time be amended, modified or terminated by the Board, subject to the requirements of
section 409A of the Code No amendment, modification or termination shall, without the consent of a
Participant, adversely affect such Participant’s accruals on his or her prior elections.



     Section 17. Governing Law. This Plan shall be governed by and construed in
accordance with the laws of the State of Maryland.




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