Document:

EX-10.4 FORM OF RESTRICTED STOCK AGREEMENT

 

Exhibit 10.4

COLONIAL PROPERTIES TRUST

THIRD AMENDED AND RESTATED

EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN

RESTRICTED SHARE AGREEMENT

          THIS AGREEMENT is entered into as of ___, ___, by and between Colonial Properties
Trust, (the “Company”), and ___, a key employee of Company and/or of its
Subsidiaries or Affiliates (the “Holder”).

Recitals:

          WHEREAS, Company has adopted the Colonial Properties Trust Third Amended and Restated Employee
Share Option and Restricted Share Plan (the “Plan”) providing for the grant under certain
circumstances of common shares of beneficial interest of the Company, par value $.01 per share (the
“Shares”);

          WHEREAS, Company, under the terms and conditions set forth below, has offered and committed to
grant Shares under the Plan (the “Restricted Share Award”) to the Holder in connection with the
employment of the Holder in the capacity set forth below; and

          WHEREAS, in consideration of the grant of the Restricted Share Award and other benefits, the
Holder is willing to accept the Restricted Share Award provided for in this Agreement and is
willing to abide by the obligations imposed on him or her under this Agreement and the other
responsibilities of his or her position;

Provisions:

          NOW, THEREFORE, in consideration of the mutual benefits hereinafter provided, and each
intending to be legally bound, Company and the Holder hereby agree as follows:

     1. Effect of the Plan.

          The Restricted Share Award to be granted under this Agreement will be subject to all of the
terms and conditions of the Plan (attached hereto as Exhibit A, the terms of which are incorporated
by reference and made part of this Agreement). The Holder will abide by, and the Restricted Share
Award granted to the Holder will be subject to, all of the provisions of the Plan and of this
Agreement, together with all rules and determinations from time to time issue by the Committee
established to administer the Plan and by the Board of Trustees of Company (hereinafter “Board”)
pursuant to the Plan.

     2. Grants.

          The Holder is hereby granted and issued ___Shares. Concurrently with the execution and
delivery of this Agreement, the Company is issuing and delivering to Holder certificates
representing the Shares being acquired by him, registered in his name. The Grant Date of this
Restricted Share Award is ___, ___.

     3. Vesting in Restricted Shares.

               3.1 Service Requirement. The Restricted Share Award becomes vested (i.e.,
nonforfeitable) as to ___% of the Restricted Shares on the first anniversary of the Grant Date
(the “Anniversary Date”) if Holder has been providing services to the Company, a Subsidiary or an
Affiliate continuously from the Grant Date. Thereafter, the Restricted Share Award becomes vested
as to ___% of the Restricted Shares on each subsequent Anniversary Date, provided Holder has been
providing services to the Company, a Subsidiary or an Affiliate continuously from the Grant Date.
Service for this purpose includes service as an employee, director or independent contractor
providing services to the Company, a Subsidiary or an Affiliate. For purposes of this Agreement,
termination of service would not be deemed to occur if the Holder, after terminating service in one
capacity, continues to provide service to the Company, any Subsidiary or any Affiliate in another
capacity. Termination of service is sometimes also referred to herein as termination of employment
or other relationship with the Company, its Subsidiaries or its Affiliates.

 

 

               3.2 Limitation Period. The period during which the Restricted Share Award is subject
to the vesting conditions of Section 3.1 above is the “Limitation Period.” Except as otherwise
determined by the Committee, during the Limitation Period applicable with respect to a Restricted
Share Award, the Holder may not sell, transfer, assign, pledge or otherwise encumber or dispose of
the Shares covered by such award. The certificate representing the Shares distributed with respect
to each Restricted Share Award made under the Plan shall be affixed with a legend setting forth the
restrictions applicable to the transfer of such Shares. When the restrictions applicable to a
Restricted Share Award shall lapse, a certificate for the number of Shares with respect to which
restrictions have lapsed shall be delivered to the Holder free of all such restrictions.
Restricted Shares that are forfeited shall be immediately transferred to the Company without any
payment by the Company.

               3.3 Termination of Service. If before the end of the Limitation Period, the Holder
terminates service with the Company by reason of the Holder’s death, “permanent and total
disability” (within the meaning of Section 22(e)(3) of the Code) or is terminated without Cause by
the Company, the Holder, his or her legal guardian, or the executor or administrator of the estate
of the Holder or the person or persons to whom rights under the Restricted Share Agreement have
passed by bequest or inheritance, as the case may be, shall be fully vested in the shares covered
by the Restricted Share Agreement. If the Holder terminates service with the Company voluntarily
other than by reason of termination for Cause, the Holder shall immediately forfeit to the Company
all unvested Restricted Shares awarded hereunder; provided, however, that the Board, in such event,
in its sole discretion, may make a written determination as to the alternative treatment of any
unvested Restricted Shares.

               For purposes of this Restricted Share Agreement, “Cause” means (i) the commission of a felony
or a crime involving moral turpitude or the commission of any other act or omission involving
dishonesty or fraud with respect to the Company, Subsidiary, or Affiliate or any of their customers
or suppliers, (ii) conduct tending to bring the Company, Subsidiary, or Affiliate into substantial
public disgrace or disrepute, (iii) substantial and repeated failure to perform duties of the
office held by the Holder as reasonably directed by the Board, and such failure is not cured within
30 days after the Holder receives notice thereof from the Board, (iv) gross negligence or willful
misconduct with respect to the Company, Subsidiary, or Affiliate or (v) material breach of any term
of any employment, consulting or other services, confidentiality, intellectual property or
non-competition agreements, if any, between Holder and the Company, Subsidiary or Affiliate.

     4. Dividend and Voting Rights.

          Subject to the restrictions contained herein, Holder, as owner of his Shares, shall have all
of the rights of a shareholder, including the right to vote such Shares and to receive all
dividends, cash or stock, paid or delivered thereon.

     5. Change of Control; Sale of Assets/Shares.

               5.1 Changes in Shares. If the number of outstanding Shares is increased or decreased
or the Shares are changed into or exchanged for a different number or kind of Shares or other
securities of the Company on account of any recapitalization, reclassification, Share split,
reverse split, combination of Shares, exchange of Shares, Share dividend or other distribution
payable in capital stock, or other increase or decrease in such Shares effected without receipt of
consideration by the Company occurring after the date the Restricted Share Award is granted, a
proportionate and appropriate adjustment shall be made by the Company in the number and kind of
Shares subject to the Restricted Share Agreement, so that the proportionate interest of the Holder
immediately following such event shall, to the extent practicable, be the same as immediately prior
to such event.

               5.2. Reorganization in Which the Company Is the Surviving Entity. Subject to Section
5.3, if the Company shall be the surviving entity in any reorganization, merger or consolidation of
the Company with one or more other entities, the Restricted Share Award shall pertain to and apply
to the securities to which a holder of the number of Shares subject to the Restricted Share
Agreement would have been entitled immediately following such reorganization, merger or
consolidation.

 

 

               5.3 Reorganization in Which the Company Is Not the Surviving Entity or Sale of Assets or
Shares. Upon the dissolution or liquidation of the Company, or upon a merger, consolidation or
reorganization of the Company with one or more other entities in which the Company is not the
surviving entity, or upon a sale of substantially all of the assets of the Company to another
entity, or upon any transaction (including, without limitation, a merger or reorganization in which
the Company is the surviving entity) approved by the Board which results in any person or entity
(or persons or entities acting as a group or otherwise in concert) owning 80 percent or more of the
combined voting power of all classes of securities of the Company, the unvested Restricted Share
Award shall become fully vested.

               5.4 Adjustments. Adjustments specified in this Section relating to Shares or
securities of the Company shall be made by the Committee, whose determination in that respect shall
be final, binding and conclusive. No fractional Shares or units of other securities shall be
issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall
be eliminated in each case by rounding downward to the nearest whole share or unit.

     6. Requirements of Law.

          The Company shall not be required to issue any Shares under the Agreement if the issuance of
such Shares would constitute a violation by the Holder or by the Company of any provision of any
law or regulation of any governmental authority, including without limitation any federal or state
securities laws or regulations. If at any time the Company shall determine, in its discretion,
that the listing, registration or qualification of any Shares subject to the Restricted Share
Agreement upon any securities exchange or under any state or federal law, or the consent or
approval of any government regulatory body, is necessary or desirable as a condition of, or in
connection with, the issuance of Shares hereunder, the Restricted Shares shall not vest in whole or
in part unless such listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Company. Specifically in
connection with the Securities Act of 1933 (as now in effect or as hereafter amended), unless a
registration statement under such Act is in effect with respect to the Shares covered by the
Restricted Share Agreement, the Company shall not be required to issue such Shares unless the
Company has received evidence satisfactory to it that the Holder may acquire such Shares pursuant
to an exemption from registration under such Act. Any determination in this connection by the
Company shall be final, binding, and conclusive. The Company may, but shall in no event be
obligated to, register any securities covered hereby pursuant to the Securities Act of 1933 (as now
in effect or as hereafter amended). The Company shall not be obligated to take any affirmative
action in order to cause the issuance of Shares pursuant thereto to comply with any law or
regulation of any governmental authority. As to any jurisdiction that expressly imposes the
requirement that the Restricted Shares shall not vest unless and until the Shares covered by the
Restricted Share Agreement are registered or are subject to an available exemption from
registration, the vesting of the Restricted Shares (under circumstances in which the laws of such
jurisdiction apply) shall be deemed conditioned upon the effectiveness of such registration or the
availability of such an exemption.

     7. Withholding of Taxes.

          The parties hereto recognize that the Company, a Subsidiary or an Affiliate may be obligated
to withhold federal and local income taxes and Social Security and Medicare taxes to the extent
that the Holder realizes compensation income in connection with the Restricted Shares. The Holder
agrees that the Company, a Subsidiary or an Affiliate may: (i) withhold amounts needed to cover
such taxes from payments otherwise due and owing to the Holder and (ii) sell or repurchase a
sufficient number of the Restricted Shares to pay such taxes without the consent of the Holder.
The Holder further agrees that upon demand the Holder will promptly pay to the Company, a
Subsidiary or an Affiliate having such obligation any additional amounts as may be necessary to
satisfy such withholding tax obligation. Such payment shall be made in cash or cash equivalent.

     8. Disclaimer of Rights.

          No provision in this Restricted Share Agreement shall be construed to confer upon the Holder
the right to be employed by the Company, any Subsidiary or any Affiliate, or to interfere in any
way with the right and authority of the Company, any Subsidiary or any Affiliate either to increase
or decrease the compensation of the Holder at any time, or to terminate any employment or other
relationship between the Holder and the Company, any Subsidiary or any Affiliate.

 

 

     9. Interpretation of this Restricted Share Agreement.

          All decisions and interpretations made by the Committee or the Board of Trustees of the
Company with regard to any question arising under the Plan or this Restricted Share Agreement shall
be binding and conclusive on the Company and the Holder and any other person entitled to the
Restricted Shares as provided for herein. In the event that there is any inconsistency between the
provisions of this Restricted Share Agreement and of the Plan, the provisions of the Plan shall
govern.

     10. Governing Law.

          This Restricted Share Agreement is executed pursuant to and shall be governed by the laws of
the State of Maryland (but not including the choice of law rules thereof).

     11. Arbitration.

          Any disputes between the Company and the Holder in any way concerning this Restricted Share
Agreement shall be submitted at the initiative of either party to mandatory arbitration before a
single arbitrator in Birmingham, Alabama pursuant to the Commercial Arbitration Rules of the
American Arbitration Association, or its successor, then in effect. The decision of the arbitrator
shall be rendered in writing, shall be final and may be entered as a judgment in any court in the
State of Alabama. The parties irrevocably consent to the jurisdiction of the federal and state
courts located in Alabama for this purpose. Each party shall be responsible for its or his own
costs incurred in such arbitration and in enforcing any arbitration award, including attorney’s
fees.

     12. Approval by Shareholders.

          This Restricted Share Agreement and the issuance of any Shares under it are expressly subject
to the approval of the Plan by the shareholders of the Company as provided for therein. The
Restricted Share shall not in any event be vested in whole or in part prior to the date the Plan is
approved by the shareholders of the Company as provided for therein.

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.

	 	 	 	 	 
	 	COLONIAL PROPERTIES TRUST

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 

	 	 	 
	 

	 	 
	WITNESS (as to Holder)

	 	HOLDEREX-10.5 FORM OF SHARE OPTION AGREEMENT

 

Exhibit 10.5

COLONIAL PROPERTIES TRUST

THIRD AMENDED AND RESTATED

EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN

NON-INCENTIVE SHARE OPTION AGREEMENT

          This Share Option Agreement (the “Share Option Agreement”) is made as of the                      day
of                                         , 200_, by and between Colonial Properties Trust (the “Company”) and
                                        , an employee of the Company, its subsidiaries or its affiliates
(the “Optionee”).

          WHEREAS, the Colonial Properties Trust Third Amended and Restated Employee Share Option and
Restricted Share Plan (the “Plan”) authorizes the Company to grant to eligible individuals options
for the purchase of common shares of beneficial interest of the Company, $.01 par value (the
“Shares”); and

          WHEREAS, the Company has determined that it is desirable and in its best interests to grant to
the Optionee, pursuant to the Plan, an option to purchase a certain number of Shares in order to
provide the Optionee with an incentive to advance the interests of the Company, all according to
the terms and conditions set forth herein;

          NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the
parties hereto do hereby agree as follows:

          1. Grant of Option.

          Subject to the terms of the Plan (the terms of which are incorporated by reference herein),
the Company hereby grants to the Optionee the right and option (the “Option”) to purchase from the
Company, on the terms and subject to the conditions hereinafter set forth,                                         
Shares. This Option shall not constitute an incentive stock option within the meaning of Section
422 of the Internal Revenue Code of 1986, as amended (the “Code”). The date of grant of this
Option (the “Date of Grant”) is                                         , the date on which the grant of the
Option was approved by the Compensation Committee of the Board of Trustees of the Company (the
“Committee”).

          2. Price.

          The purchase price (the “Option Price”) for the Shares subject to the Option granted by this
Option Agreement is $                                         per Share, which price is not less than 100 percent of
the Fair Market Value of the Shares, as determined by the Company, on the Date of Grant of this
Option.

          3. Exercise of Option.

          Except as otherwise provided herein, the Option granted pursuant to this Option Agreement
shall be subject to exercise as follows:

               3.1 Time of Exercise of Option. The Optionee may exercise the Option (subject to the
limitations on exercise set forth in this Agreement and in the Plan), in installments as follows:
on the first anniversary of the Date of Grant of the Option, as set forth in Section 1 above, the
Option shall be exercisable in respect of ___percent (___%) of the number of Shares
specified in Section 1 above, and the Option shall be exercisable in respect of an additional
___percent (___%) of the number of Shares specified in Section 1 above on each of the
second, third, fourth and fifth anniversaries of the Date of Grant, as set forth in Section 1
above. The foregoing installments, to the extent not exercised, shall accumulate and be
exercisable, in whole or in part, at any time and from time to time, after becoming exercisable and
prior to the termination of the Option; provided, that no single exercise of the Option
shall be for less than 100 Shares, unless the number of Shares purchased is the total number at the
time available for purchase under this Option.

               3.2 Exercise by Optionee. During the lifetime of the Optionee, only the Optionee (or,
in the event of the Optionee’s legal incapacity or incompetency, the Optionee’s guardian or legal
representative) may exercise the Option.

 

 

               3.3 Termination of Employment. Except as provided in Sections 3.4 and 3.5:

                    (a) The Optionee may exercise the Option only while the Optionee is employed by the Company,
by any “subsidiary corporation” thereof within the meaning of Section 424(f) of the Code (a
“Subsidiary”) or by any Affiliate (as defined in the Plan) or for three months thereafter, after
which the Option shall terminate; and

                    (b) Upon the Optionee’s termination of employment, the Optionee may (subject to the
limitations on exercise set forth in Section 3.8 below) exercise all or any part of the Option but
only to the extent the Option was exercisable at the time of termination of employment, at any time
within three months after termination of employment and prior to termination of the Option as set
forth in Section 3.7.

               3.4 Death. In the event of the Optionee’s death either while employed by the Company,
a Subsidiary or an Affiliate or within the period following the termination of employment with the
Company, a Subsidiary or an Affiliate during which the Option was exercisable pursuant to Section
3.3 or 3.5, the personal representative or legatees or distributees of the Optionee’s estate, as
the case may be, shall have the right (subject to the limitations on exercise set forth in Section
3.8 below) to exercise all or any part of the Option, whether or not the Option was exercisable on
the date of the Optionee’s death, at any time within one (1) year after the date of the Optionee’s
death and prior to termination of the Option as set forth in Section 3.7.

               3.5 Disability. If the Optionee’s termination of employment is by reason of
“permanent and total disability” (within the meaning of Section 22(e)(3) of the Code), the Optionee
or the guardian or legal representative shall have the right (subject to the limitations on
exercise set forth in Section 3.8 below) to exercise all or any part of the Option, whether or not
the Option was exercisable at the time of termination of employment, at any time within one (1)
year after termination of employment and prior to termination of the Option as set forth in Section
3.7.

               3.6 Termination of Option. The Option shall terminate upon the earlier of (i) the
expiration of a period of ten years from the date of grant of the Option, as set forth in Section 1
above or (ii) three months after the Optionee’s termination of employment with the Company, a
Subsidiary or an Affiliate, unless such termination falls within the scope of Section 3.4 or 3.5.

               3.8 Limitations on Exercise of Option. Notwithstanding the foregoing Subsections of
this Section, in no event may the Option be exercised, in whole or in part, prior to the date the
Plan is approved by the shareholders of the Company as provided therein, or after ten years
following the date upon which the Option is granted, as set forth in Section 1 above, or after the
occurrence of an event referred to in Section 8 below which results in termination of the Option.
In no event may the Option be exercised for a fractional Share.

          4. Method of Exercise of Option.

          Subject to the terms and conditions of this Share Option Agreement, the Option may be
exercised by delivering written notice of exercise to the Company, at its principal office,
addressed to the attention of the President, which notice shall specify the number of Shares for
which the Option is being exercised, and shall be accompanied by payment in full of the Option
Price of the shares for which the Option is being exercised. Payment of the Option Price for the
Shares purchased pursuant to the exercise of the Option shall be made either (i) in cash or in cash
equivalents; (ii) through the tender to the Company of Shares, which Shares shall be valued, for
purposes of determining the extent to which the Option Price has been paid thereby, at their Fair
Market Value (as determined by the Committee in accordance with the Plan) on the date of exercise;
or (iii) by a combination of the methods described in (i) and (ii). Payment in full of the Option
Price need not accompany the written notice of exercise provided the notice of exercise directs
that the Share certificate or certificates for the Shares for which the Option is exercised be
delivered to a licensed broker acceptable to the Company as the agent for individual exercising the
Option and, at the time such Share certificate or certificates are delivered, the broker tenders to
the Company cash (or cash equivalents acceptable to the Company) equal to the Option Price for the
Shares purchased pursuant to the exercise of the Option plus the amount (if any) of federal and/or
other taxes which the Company may, in its judgment, be required to withhold with respect to the
exercise of the Option. If the person exercising the Option is not the Optionee, such person shall
also deliver with the notice of exercise appropriate proof of his or her right to exercise the
Option. An attempt to exercise the Option granted hereunder other than as set forth above shall be
invalid and of no force and effect. Promptly after exercise of the Option as provided for above,
the Company shall deliver to the person exercising the Option a certificate or certificates for the
Shares being purchased.

 

 

          5. Parachute Limitations.

          Notwithstanding any other provision of this Share Option Agreement or of any other agreement,
contract, or understanding heretofore or hereafter entered into by the Optionee with the Company,
except an agreement, contract, or understanding hereafter entered into that expressly modifies or
excludes application of this paragraph (an “Other Agreement”), and notwithstanding any formal or
informal plan or other arrangement for the direct or indirect provision of compensation to the
Optionee (including groups or classes of participants or beneficiaries of which the Optionee is a
member), whether or not such compensation is deferred, is in cash, or is in the form of a benefit
to or for the Optionee (a “Benefit Arrangement”), if the Optionee is a “disqualified individual,”
as defined in Section 280G(c) of the Code, this Option and any right to receive any payment or
other benefit under this Option shall not become exercisable or vested (i) to the extent that such
right to exercise, vesting, payment, or benefit, taking into account all other rights, payments, or
benefits to or for the Optionee under this Option, all Other Agreements, and all Benefit
Arrangements, would cause any payment or benefit to the Optionee under this Option to be considered
a “parachute payment” within the meaning of Section 280G(b)(2) of the Internal Revenue Code as then
in effect (a “Parachute Payment”) and (ii) if, as a result of receiving a Parachute
Payment, the aggregate after-tax amounts received by the Optionee from the Company under this
Option, all Other Agreements, and all Benefit Arrangements would be less than the maximum after-tax
amount that could be received by him without causing any such payment or benefit to be considered a
Parachute Payment. In the event that the receipt of any such right to exercise, vesting, payment,
or benefit under this Option, in conjunction with all other rights, payments, or benefits to or for
the Optionee under any Other Agreement or any Benefit Arrangement would cause the Optionee to be
considered to have received a Parachute Payment under this Option that would have the effect of
decreasing the after-tax amount received by the Optionee as described in clause (ii) of the
preceding sentence, then the Optionee shall have the right, in the Optionee’s sole discretion, to
designate those rights, payments, or benefits under this Option, any Other Agreements, and any
Benefit Arrangements that should be reduced or eliminated so as to avoid having the payment or
benefit to the Optionee under this Option be deemed to be a Parachute Payment.

          6. Limitations on Transfer.

          During the lifetime of the Optionee, only the Optionee (or, in the event of legal incapacity
or incompetency, the guardian or legal representative of the Optionee), may exercise the Option,
except that, all or a portion of the Option may be transferred by the Optionee during his or her
lifetime to (i) Immediate Family Members, (ii) a trust or trusts for the exclusive benefit of such
Immediate Family Members or (iii) a partnership in which such Immediate Family Members are the only
partners, in which case such transferees may exercise the Option. Except as noted in the preceding
sentence, transfer of the Option is prohibited except by will or the laws of descent and
distribution. Following transfer, the Option shall continue to be subject to the same terms and
conditions as were applicable immediately prior to transfer, provided that for purposes of Section
3 hereof (excluding Sections 3.3, 3.4 and 3.5), the term “Optionee” shall be deemed to refer to the
transferee. The events of termination of employment, death and disability set forth in Sections
3.3, 3.4 and 3.5 hereof, respectively, shall continue to be applied with respect to the original
Optionee, following which the Option shall be exercisable by the transferee only to the extent and
for the periods specified in Section 3. The Option may not be pledged or hypothecated (by law or
otherwise) or subject to execution, attachment or similar processes.

          7. Rights as Shareholder.

          Neither the Optionee nor any executor, administrator, distributee or legatee of the Optionee’s
estate shall be, or have any of the rights or privileges of, a shareholder of the Company in
respect of any Shares transferable hereunder unless and until such Shares have been fully paid and
certificates representing such Shares have been endorsed, transferred and delivered, and the name
of the Optionee (or of such personal representative, administrator, distributee or legatee of the
Optionee’s estate) has been entered as the shareholder of record on the books of the Company.

          8. Effect of Changes in Capitalization.

               8.1 Changes in Shares. If the number of outstanding Shares is increased or decreased
or the Shares are changed into or exchanged for a different number or kind of Shares or other
securities of the Company on account of any recapitalization, reclassification, stock split,
reverse split, combination of Shares, exchange of Shares, stock dividend or other distribution
payable in capital stock, or other increase or decrease in such Shares effected without receipt of
consideration by the Company occurring after the date the Option is granted, a proportionate and
appropriate adjustment shall be made by the Company in the number and kind of Shares subject to

 

 

the Option, so that the proportionate interest of the Optionee immediately following such event
shall, to the extent practicable, be the same as immediately prior to such event. Any such
adjustment in the Option shall not change the aggregate Option Price payable with respect to Shares
subject to the unexercised portion of the Option but shall include a corresponding proportionate
adjustment in the Option Price per Share.

               8.2 Reorganization in Which the Company Is the Surviving Entity. Subject to Section
8.3, if the Company shall be the surviving entity in any reorganization, merger or consolidation of
the Company with one or more other entities, the Option shall pertain to and apply to the
securities to which a holder of the number of Shares subject to the Option would have been entitled
immediately following such reorganization, merger or consolidation, with a corresponding
proportionate adjustment of the Option Price per Share so that the aggregate Option Price
thereafter shall be the same as the aggregate Option Price of the Shares remaining subject to the
Option immediately prior to such reorganization, merger or consolidation.

               8.3 Reorganization in Which the Company Is Not the Surviving Entity or Sale of Assets or
Shares. Upon the dissolution or liquidation of the Company, or upon a merger, consolidation or
reorganization of the Company with one or more other entities in which the Company is not the
surviving entity, or upon a sale of substantially all of the assets of the Company to another
entity, or upon any transaction (including, without limitation, a merger or reorganization in which
the Company is the surviving entity) approved by the Board which results in any person or entity
(or persons or entities acting as a group or otherwise in concert) owning 80 percent or more of the
combined voting power of all classes of securities of the Company, the Option hereunder shall
terminate, except to the extent provision is made in connection with such transaction for the
continuation and/or the assumption of the Option, or for the substitution for the Option of new
options covering the stock of a successor employer entity, or a parent or subsidiary thereof, with
appropriate adjustments as to the number and kinds of shares and exercise prices, in which event
the Option shall continue in the manner and under the terms so provided. In the event of any such
termination of the Option, the Optionee shall have the right (subject to the limitations on
exercise set forth in Section 3.7 above), for 30 days immediately prior to the occurrence of such
termination, to exercise the Option in whole or in part, whether or not the Optionee was otherwise
entitled to exercise such Option at the time such termination occurs. The Company shall send
written notice of an event that will result in such a termination to the Optionee not later than
the time at which the Company gives notice thereof to its shareholders.

               8.4 Adjustments. Adjustments specified in this Section relating to Shares or
securities of the Company shall be made by the Committee, whose determination in that respect shall
be final, binding and conclusive. No fractional Shares or units of other securities shall be
issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall
be eliminated in each case by rounding downward to the nearest whole share or unit.

          9. Requirements of Law.

          The Company shall not be required to sell or issue any Shares under the Option if the sale or
issuance of such Shares would constitute a violation by the individual exercising the Option or by
the Company of any provision of any law or regulation of any governmental authority, including
without limitation any federal or state securities laws or regulations. If at any time the Company
shall determine, in its discretion, that the listing, registration or qualification of any Shares
subject to the Option upon any securities exchange or under any state or federal law, or the
consent or approval of any government regulatory body, is necessary or desirable as a condition of,
or in connection with, the issuance or purchase of Shares hereunder, the Option may not be
exercised in whole or in part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to the Company, and any
delay caused thereby shall in no way affect the date of termination of the Option. Specifically in
connection with the Securities Act of 1933 (as now in effect or as hereafter amended), unless a
registration statement under such Act is in effect with respect to the Shares covered by the
Option, the Company shall not be required to sell or issue such Shares unless the Company has
received evidence satisfactory to it that the holder of the Option may acquire such Shares pursuant
to an exemption from registration under such Act. Any determination in this connection by the
Company shall be final, binding, and conclusive. The Company may, but shall in no event be
obligated to, register any securities covered hereby pursuant to the Securities Act of 1933 (as now
in effect or as hereafter amended). The Company shall not be obligated to take any affirmative
action in order to cause the exercise of the Option or the issuance of shares pursuant thereto to
comply with any law or regulation of any governmental authority. As to any jurisdiction that
expressly imposes the requirement that the Option shall not be exercisable unless and until the
Shares covered by the Option are registered or are subject to an available exemption from
registration, the exercise of

 

 

the Option (under circumstances in which the laws of such jurisdiction apply) shall be deemed
conditioned upon the effectiveness of such registration or the availability of such an exemption.

          10. Withholding of Taxes.

          The parties hereto recognize that the Company or a Subsidiary may be obligated to withhold
federal and local income taxes and Social Security and Medicare taxes to the extent that the
Optionee realizes ordinary income in connection with the exercise of the Option. The Optionee
agrees that the Company or a Subsidiary may withhold amounts needed to cover such taxes from
payments otherwise due and owing to the Optionee, and also agrees that upon demand the Optionee
will promptly pay to the Company or a Subsidiary having such obligation any additional amounts as
may be necessary to satisfy such withholding tax obligation. Such payment shall be made in cash or
cash equivalent.

          11. Disclaimer of Rights.

          No provision in this Share Option Agreement shall be construed to confer upon the Optionee the
right to be employed by the Company, any Subsidiary or any Affiliate, or to interfere in any way
with the right and authority of the Company, any Subsidiary or any Affiliate either to increase or
decrease the compensation of the Optionee at any time, or to terminate any employment or other
relationship between the Optionee and the Company, any Subsidiary or any Affiliate.

          12. Interpretation of this Share Option Agreement.

          All decisions and interpretations made by the Committee or the Board of Trustees of the
Company with regard to any question arising under the Plan or this Share Option Agreement shall be
binding and conclusive on the Company and the Optionee and any other person entitled to exercise
the Option as provided for herein. In the event that there is any inconsistency between the
provisions of this Share Option Agreement and of the Plan, the provisions of the Plan shall govern.

          13. Governing Law.

          This Share Option Agreement is executed pursuant to and shall be governed by the laws of the
State of Maryland (but not including the choice of law rules thereof).

          14. Arbitration.

          Any disputes between the Company and the Holder in any way concerning this Share Option
Agreement shall be submitted at the initiative of either party to mandatory arbitration before a
single arbitrator in Birmingham, Alabama pursuant to the Commercial Arbitration Rules of the
American Arbitration Association, or its successor, then in effect. The decision of the arbitrator
shall be rendered in writing, shall be final and may be entered as a judgment in any court in the
State of Alabama. The parties irrevocably consent to the jurisdiction of the federal and state
courts located in Alabama for this purpose. Each party shall be responsible for its or his own
costs incurred in such arbitration and in enforcing any arbitration award, including attorney’s
fees.

 

 

          15. Binding Effect.

          Subject to all restrictions provided for in this Share Option Agreement and by applicable law
relating to assignment and transfer of this Share Option Agreement and the option provided for
herein, this Share Option Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective heirs, executors, administrators, successors, and assigns.

          16. Notice.

          Any notice hereunder by the Optionee to the Company shall be in writing and shall be deemed
duly given if mailed or delivered to the Company at its principal office, addressed to the
attention of the Committee, or if so mailed or delivered to such other address as the Company may
hereafter designate by notice to the Optionee. Any notice hereunder by the Company to the Optionee
shall be in writing and shall be deemed duly given if mailed or delivered to the Optionee at the
address specified below by the Optionee for such purpose, or if so mailed or delivered to such
other address as the Optionee may hereafter designate by written notice given to the Company.

          17. Entire Agreement.

          This Share Option Agreement constitutes the entire agreement and supersedes all prior
understandings and agreements, written or oral, of the parties hereto with respect to the subject
matter hereof. Neither this Share Option Agreement nor any term hereof may be amended, waived,
discharged or terminated except by a written instrument signed by the Company and the Optionee;
provided, however, that the Company unilaterally may waive any provision hereof in
writing to the extent that such waiver does not adversely affect the interests of the Optionee
hereunder, but no such waiver shall operate as or be construed to be a subsequent waiver of the
same provision or a waiver of any other provision hereof.

          IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Share Option
Agreement, or caused this Share Option Agreement to be duly executed and delivered on their behalf,
as of the day and year first above written.

	 	 	 	 	 	 	 
	ATTEST:	 	 	 	COLONIAL PROPERTIES TRUST
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	OPTIONEE:
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	ADDRESS FOR NOTICE TO OPTIONEE:
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	Number                     Street
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	City                State                Zip Code

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