<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
WEINGARTEN REALTY INVESTORS
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
----------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------------
(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
WEINGARTEN REALTY INVESTORS
2600 CITADEL PLAZA DRIVE
HOUSTON, TEXAS 77008
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 2, 1996
To Our Shareholders:
Notice is hereby given that the Annual Meeting of Shareholders of Weingarten
Realty Investors (the "Company") will be held at The Houstonian, 111 N. Post
Oak Lane, Houston, Texas on Tuesday, May 2, 1996, at 4:00 p.m., Houston time.
Shareholders will be asked to vote on the following proposals:
Proposal 1: The election of nine trust managers to serve until the next
Annual Meeting of Shareholders or until their successors have been elected
and qualified.
Proposal 2: Ratification of the appointment of Deloitte & Touche llp,
independent certified public accountants, as the Company's auditors for the
ensuing year.
Proposal 3: The amendment of the 1993 Incentive Share Plan of the Company
to increase the number of shares available thereunder from 500,000 to
1,000,000.
The enclosed Proxy Statement includes information relating to these
proposals. Additional purposes of the meeting are to receive reports of
officers (without taking action thereon) and to transact such other business as
may properly come before the meeting.
All shareholders of record as of the close of business on March 4, 1996 are
entitled to notice of and to vote at the meeting. At least a majority of the
outstanding common shares of the Company is required for a quorum.
The Board of Trust Managers appreciates and encourages your participation in
the Company's annual meeting. Whether or not you plan to attend the meeting, it
is important that your shares be represented. Accordingly, please sign, date
and promptly return the enclosed proxy in the postage-paid envelope provided.
If you attend the meeting, you may withdraw your proxy, if you wish, and vote
in person.
By order of the Board of Trust
Managers,
M. CANDACE DuFOUR
Vice President and Secretary
March 26, 1996
Houston, Texas
<PAGE>
WEINGARTEN REALTY INVESTORS
2600 CITADEL PLAZA DRIVE
HOUSTON, TEXAS 77008
PROXY STATEMENT
SOLICITATION AND REVOCABILITY OF PROXIES
This Proxy Statement is furnished by the Board of Trust Managers of
Weingarten Realty Investors (the "Company") in connection with the solicitation
of proxies for use at the Annual Meeting of Shareholders of the Company to be
held May 2, 1996, and at any adjournment thereof. This Proxy Statement relates
to a meeting of the holders of common shares of beneficial interest, par value
$0.03 per share ("Common Shares"), of the Company to consider and act upon the
proposals set forth in the notice of meeting attached hereto, including the
election of trust managers. This Proxy Statement and the related form of Proxy
will be sent or given to shareholders beginning on or about March 26, 1996.
The Common Shares represented by the form of proxy enclosed herewith will be
voted in accordance with the specifications noted thereon. If no choice is
specified, said Common Shares will be voted in favor of the proposals set forth
in the notice attached hereto. The affirmative vote of two-thirds of the
outstanding Common Shares is required to elect each trust manager nominee. The
affirmative vote of the holders of a majority of the Common Shares present in
person or by proxy at the Annual Meeting of Shareholders and entitled to vote
is required for approval of the ratification of the appointment of auditors and
for the amendment of the 1993 Incentive Share Plan. The Texas Real Estate
Investment Trust Act does not specifically address the treatment of abstentions
and broker non-votes. The Company's Bylaws provide that shares abstaining from
a vote or not voted on a matter will not be treated as entitled to vote. The
form of proxy also confers discretionary authority with respect to amendments
or variations to matters identified in the notice of meeting and any other
matters that may properly come before the meeting.
A shareholder who has given a proxy may revoke it as to any motion on which a
vote has not already been taken by signing a proxy bearing a later date or by
written notice delivered to the Secretary of the Company at the Company's
principal executive office, 2600 Citadel Plaza Drive, Houston, Texas 77008 (the
mailing address for the Company is P. O. Box 924133, Houston, Texas 77292-
4133), at any time up to the meeting or any adjournment thereof, or by
delivering it to the Chairman of the meeting on the date of the meeting or any
adjournment thereof.
The cost of solicitation of these proxies will be paid by the Company,
including reimbursement paid to brokerage firms and other custodians, nominees
and fiduciaries for reasonable costs incurred in forwarding the proxy material
to and solicitation of proxies from the beneficial owners of Common Shares held
of record by such person. It is anticipated that the solicitation will be
primarily by mail on or about March 26, 1996, but proxies also may be solicited
personally or by telephone by regular employees of the Company without
additional compensation.
<PAGE>
VOTING SECURITIES AND PRINCIPAL HOLDERS
All shareholders of record as of the close of business on March 4, 1996 are
entitled to notice of and to vote at the meeting. Provided a complete and
executed form of proxy shall have been delivered to the Secretary of the
Company prior to the meeting, any person may attend and vote that number of
shares for which he holds a proxy. On March 4, 1996, the Company had 26,547,174
Common Shares outstanding, which were held of record by 2,800 persons. The
Common Shares are the only class of voting securities of the Company. Each
Common Share is entitled to one vote.
The following table sets forth the beneficial ownership of the Company's
Common Shares with respect to each person known by the Company to be the
beneficial owner of more than five percent of the Company's outstanding Common
Shares as of March 4, 1996.
<TABLE>
<CAPTION>
NAME AND BUSINESS ADDRESS AMOUNT AND NATURE OF PERCENT
OF BENEFICIAL OWNERS BENEFICIAL OWNERSHIP OF CLASS
------------------------- -------------------- --------
<S> <C> <C>
Stanford Alexander................................ 2,072,578(1) 7.8%
P.O. Box 924133
Houston, Texas 77292-4133
The Capital Group Companies, Inc. ................ 1,692,840(2) 6.3%
333 South Hope Street
Los Angeles, California 90071
</TABLE>
- --------
(1) Includes 376,170 shares held by various trusts for the benefit of Mr.
Alexander's children and 296,675 shares for which voting and investment
power are shared with Andrew M. Alexander and Melvin A. Dow, trust managers
of the Company; 14,400 shares subject to restrictions on transfer for which
Mr. Alexander has the right to vote and 25,000 shares that may be purchased
by Mr. Alexander upon exercise of share options that are currently
exercisable or that will become exercisable within 60 days of the date for
which beneficial ownership is provided in the table. Also includes 228,125
shares held by a charitable foundation, which Mr. Alexander and his wife
Joan control.
(2) Pursuant to information contained in a Schedule 13G filed with the
Securities and Exchange Commission in February 1996 and in a letter from
The Capital Group Companies, Inc. ("CG") in February 1996, the Company was
informed that as of December 29, 1995 Capital Guardian Trust Company and
Capital Research and Management Company, operating subsidiaries of The
Capital Group Companies, Inc. exercised as of December 29, 1995, investment
discretion with respect to 65,500 and 1,561,840 shares, respectively, or a
combined total of 6.3% of outstanding shares owned by various institutional
investors.
2
<PAGE>
PROPOSAL 1
ELECTION OF TRUST MANAGERS
The Board of Trust Managers has nominated and urges you to vote "FOR" the
nine nominees listed below as trust managers who, if elected, would serve until
the next Annual Meeting of Shareholders or until their successors have been
elected and qualified. The persons whose names are set forth as proxies in the
enclosed form of proxy will vote all shares for which they hold proxies "FOR"
the election of the nominees named herein unless otherwise directed. Although
the trust managers of the Company do not contemplate that any of the nominees
will be unable to serve, if such a situation should arise prior to the meeting,
the appointed proxies will use their discretionary authority pursuant to the
proxy and vote in accordance with their best judgment. The affirmative vote of
the holders of two-thirds of the outstanding Common Shares is required to elect
each trust manager nominee.
All of the nominees for election as trust managers are members of the present
Board of Trust Managers and have consented in writing to be named in this proxy
statement and to serve as a trust manager, if elected. Set forth below is
certain information as of March 4, 1996 for (i) the members of the present
Board of Trust Managers, (ii) the executive officers of the Company set forth
under "-- Executive Compensation" and (iii) the trust managers and executive
officers of the Company as a group:
<TABLE>
<CAPTION>
SERVED AS
TRUST AMOUNT AND
MANAGER NATURE OF PERCENT
NAME AGE SINCE BENEFICIAL OWNERSHIP OF CLASS
---- --- --------- -------------------- --------
<S> <C> <C> <C> <C>
Stanford Alexander(1)............... 67 1956 2,072,578(4) 7.8%
Andrew M. Alexander................. 39 1983 619,103(5) 2.3%
Martin Debrovner(1)................. 59 1976 120,263(6) *
Melvin A. Dow(2)(3)................. 68 1984 502,277(7) 1.9%
Stephen A. Lasher(1)(3)............. 47 1980 523,102(8) 2.0%
Joseph W. Robertson, Jr. ........... 48 1978 84,883(9) *
Douglas W. Schnitzer................ 39 1984 630,280(10) 2.4%
Marc J. Shapiro(2)(3)............... 48 1985 11,500(11) *
J. T. Trotter(2).................... 69 1985 1,000 *
John J. Marcisz(12)................. 58 31,210(13) *
All trust managers and executive
officers as a group (15 persons)... 4,162,802(14) 15.6%
</TABLE>
- --------
* Beneficial ownership of less than 1% of the class is omitted.
(1) Member of Executive Committee.
(2) Member of Audit Committee.
(3) Member of Executive Compensation Committee.
(Notes continued on following page)
3
<PAGE>
(4) See note (1) to the table on page 2 for information with respect to Mr.
Alexander's beneficial ownership of such shares.
(5) Includes the 296,675 shares described in note (1) to the table on page 2
for which voting and investment power are shared with Stanford Alexander
and Melvin A. Dow; 4,320 shares subject to restrictions on transfer for
which Mr. Alexander has the right to vote and 18,000 shares that may be
purchased by Mr. Alexander upon the exercise of share options that are
currently exercisable or that will become exercisable within 60 days of
the date for which beneficial ownership is provided in the table.
(6) Includes 26,878 shares held in trust for the benefit of Mr. Debrovner's
children for which he exercises voting power. Also includes 9,200 shares
subject to restrictions on transfer for which Mr. Debrovner has the right
to vote and 21,000 shares that may be purchased upon the exercise of share
options that are currently exercisable or that will become exercisable
within 60 days of the date for which beneficial ownership is provided in
the table.
(7) Includes the 296,675 shares described in note (1) to the table on page 2
for which voting and investment power are shared with Andrew M. Alexander
and Stanford Alexander.
(8) Includes 57,785 shares held by trusts for the benefit of Mr. Lasher's
children for which Mr. Lasher exercises voting power.
(9) Includes 5,680 shares subject to restrictions on transfer for which Mr.
Robertson has the right to vote and 18,000 shares that may be purchased
upon the exercise of share options that are currently exercisable or that
will become exercisable within 60 days of the date for which beneficial
ownership is provided in the table.
(10) Voting and investment power are shared with Joan Weingarten Schnitzer
under trusts for Joan Weingarten Schnitzer with respect to all such
shares.
(11) Includes 2,600 shares owned by Mr. Shapiro's children for which he
disclaims beneficial ownership because he holds no custodial authority
with respect to such shares.
(12) Mr. Marcisz is an executive officer of the Company and not a member of the
Board of Trust Managers.
(13) Includes 2,400 shares subject to restrictions on transfer for which Mr.
Marcisz has the right to vote and 10,000 shares that may be purchased upon
the exercise of share options that are currently exercisable or that will
become exercisable within 60 days of the date for which beneficial
ownership is provided in the table.
(14) Includes 137,100 shares that may be purchased upon the exercise of share
options that are currently exercisable or that will become exercisable
within 60 days of the date for which beneficial ownership is provided in
the table.
4
<PAGE>
Set forth below is certain biographical information with respect to the
business experience of the nine nominees to serve as the Company's trust
managers for at least the last five years.
Mr. Stanford Alexander is the Company's Chairman and its Chief Executive
Officer. He has been employed by the Company since 1955 and has served in his
present capacity since January 1, 1993. Prior to becoming Chairman, Mr.
Alexander served as President and Chief Executive Officer of the Company since
1962. Mr. Alexander is President, Chief Executive Officer and a trust manager
of Weingarten Properties Trust and a member of the Houston Regional Advisory
Board of Texas Commerce Bank National Association, Houston, Texas ("TCB").
Mr. Andrew M. Alexander became Executive Vice President/Asset Management of
the Company on January 1, 1993. Prior to his present position, Mr. Alexander
was Senior Vice President/Asset Management of Weingarten Realty Management
Company (the "Management Company"). Prior to such time, Mr. Alexander was Vice
President of the Management Company and, prior to the Company's reorganization
in December 1984, was Vice President and an employee of the Company since 1978.
Mr. Alexander has been primarily involved with leasing operations at both the
Company and the Management Company. Mr. Alexander is also a trust manager of
Weingarten Properties Trust and a director of Charter Bank Houston, N.A.
Mr. Debrovner became President and Chief Operating Officer of the Company on
January 1, 1993. Prior to assuming such position, Mr. Debrovner served as
President of the Management Company since the Company's reorganization in
December 1984. Prior to such time, Mr. Debrovner was an employee of the Company
for 17 years, holding the positions of Senior Vice President from 1980 until
March 1984, and Executive Vice President until December 1984. As Executive Vice
President, Mr. Debrovner was generally responsible for the Company's
operations. Mr. Debrovner is also a trust manager of Weingarten Properties
Trust.
Mr. Dow has been engaged in the private practice of law and was named
Chairman/CEO in January 1995 of Dow Cogburn & Friedman, P.C. Prior to assuming
such position, Mr. Dow served as President and was a partner of the predecessor
Houston law firm of Dow, Cogburn & Friedman since 1954. Mr. Dow is also a trust
manager of Weingarten Properties Trust.
Mr. Lasher has been President of The GulfStar Group, Inc., an investment
banking firm, since January 1991. Prior to such time, he was Executive Vice
President and Managing Director of Corporate Finance of Rotan Mosle Inc., an
investment banking firm headquartered in Houston, for more than five years. Mr.
Lasher is also a trust manager of Weingarten Properties Trust and a director of
American Oilfield Divers, Inc.
Mr. Robertson is Executive Vice President of the Company and its Chief
Financial Officer. Prior to becoming Executive Vice President, Mr. Robertson
served as Senior Vice President and Chief Financial Officer since 1980. He has
been with the Company since 1971. Mr. Robertson is also a trust manager of
Weingarten Properties Trust and a director of PaineWebber Retail Properties
Investments, Inc.
5
<PAGE>
Mr. Douglas Schnitzer is Chairman/CEO of Senterra Development Corp., a
commercial real estate development and management company headquartered in
Houston. Mr. Schnitzer served as President and Chief Executive Officer of
Senterra Development from August 1989 until December 1994. Prior to such time,
he served as Senior Vice President/General Marketing & U.S.C.B of Century
Development Corporation for more than five years.
Mr. Shapiro has served as Chairman, President and Chief Executive Officer of
TCB since January 1994. Prior to such time, he served as President and Chief
Executive Officer of TCB since December 1989. Mr. Shapiro is also currently an
executive officer of Chemical Banking Corporation. From 1982 to 1989, Mr.
Shapiro served as Vice Chairman and Chief Financial Officer of TCB. Mr. Shapiro
is also a director of Sante Fe Energy Resources, Inc., Browning-Ferris
Industries and Burlington Northern Santa Fe Corporation.
Mr. Trotter has been a private investor for more than the last five years.
Mr. Trotter is a director of Houston Industries, Inc., Houston Lighting & Power
Company, Howell Corporation, First Interstate Bank of Texas, N.A., and King
Ranch, Inc.
Andrew M. Alexander is the son of Stanford Alexander. Stephen A. Lasher is a
first cousin of Douglas W. Schnitzer, a first cousin once-removed of Stanford
Alexander and a second cousin of Andrew M. Alexander. Douglas W. Schnitzer is a
first cousin once-removed of Stanford Alexander and a second cousin of Andrew
M. Alexander. Martin Debrovner is a first cousin of Mrs. Stanford (Joan)
Alexander.
BOARD COMMITTEES AND MEETINGS
The Board of Trust Managers of the Company met four times in 1995. During
1995, each trust manager, except Mr. Trotter, attended at least 75 percent of
the aggregate of (a) the total number of meetings of the Board of Trust
Managers and (b) the total number of meetings held by any committee of the
Board on which he served. Mr. Trotter attended 50 percent of the meetings for
both the Board of Trust Managers and the committee on which he served. The
Company's Board of Trust Managers has standing Executive, Audit and Executive
Compensation Committees. The Board of Trust Managers does not have a nominating
committee.
Executive Committee. The Executive Committee is comprised of Messrs. S.
Alexander, Debrovner and Lasher. Pursuant to the Company's bylaws, the
Executive Committee shall have such authority and powers as may from time to
time be delegated thereto by the Board of Trust Managers. The Executive
Committee has been granted the authority to acquire and dispose of real
property up to $25,000,000 in value and has the power to authorize, on behalf
of the full Board, the execution of certain contracts and agreements, including
those related to the borrowing of money by the Company. The Executive Committee
did not meet during 1995.
Audit Committee. The Audit Committee is composed of three independent trust
managers, Messrs. Dow, Shapiro and Trotter. The Audit Committee was established
to make recommendations concerning the engagement of independent public
accountants, to review with the independent public accountants the plans for
and results of the audit engagement, to approve professional services provided
by the independent public
6
<PAGE>
accountants, to review the independence of the independent public accountants,
to consider the range of audit and non-audit fees and to review the adequacy of
the Company's internal accounting controls. The Audit Committee met twice
during 1995.
Executive Compensation Committee. The Executive Compensation Committee, also
composed of independent trust managers, is responsible for determining
compensation for the Company's executive officers, in addition to administering
the Company's 1988 Share Option Plan (the "1988 Plan") and the 1993 Incentive
Share Plan (the "Incentive Plan"). During 1995, the Executive Compensation
Committee consisted of Messrs. Dow, Lasher and Shapiro. The Executive
Compensation Committee met once in 1995.
COMPENSATION OF TRUST MANAGERS
During the year ended December 31, 1995, fees paid to all the Company's trust
managers as a group aggregated $34,500. Company trust managers received $2,500
annually, $1,000 for each Board meeting attended and $500 for each committee
meeting attended. Employees of the Company are not paid any trust manager fees.
No member of the Board of Trust Managers of the Company was paid any
compensation in 1995 for his service as a trust manager of the Company other
than pursuant to the standard compensation arrangement for trust managers.
REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
ON ANNUAL COMPENSATION OF EXECUTIVE OFFICERS
The Executive Compensation Committee of the Board of Trust Managers (the
"Compensation Committee"), which is entirely comprised of independent trust
managers, is responsible for evaluating and establishing the level of executive
compensation and administering the Company's share option plans.
COMPENSATION PHILOSOPHY AND OBJECTIVES
It is the philosophy of the Compensation Committee and the Company that in
order to achieve continual growth and financial success, the Company must be
able to attract and retain qualified executives. In order to achieve its
objective, the Company has structured an incentive based compensation system
tied to the Company's financial performance and portfolio growth. Where
material and supportive of the Company's compensation philosophy, the Company
will attempt to maximize the amount of compensation expense that is tax
deductible.
Each year, the Compensation Committee reviews the Company's compensation
program to insure that pay levels and incentive opportunities are competitive
and reflect the performance of the Company. The executive compensation system
is basically comprised of base salary, bonus compensation, share options/grants
and restricted shares. The Company's annual executive compensation package,
including that of the Chief Executive Officer ("CEO") and the Chief Operating
Officer ("COO"), generally has lower base salaries than comparable companies
coupled with a leveraged incentive bonus system which will pay more with good
performance and less with performance that is below expectation. Generally, the
CEO's and COO's bonus is within 25% to 50% of the entire cash compensation
(salary and bonus), depending on the size of the incentive bonus awarded.
7
<PAGE>
BASE SALARY
Base salary levels for executive officers are largely derived through an
evaluation of the responsibilities of the position held and the experience of
the particular individuals, both compared to companies of similar size,
complexity and, where comparable, in the same industry. The determination of
comparable companies was based upon selections made by both the Company, as to
comparable companies in the real estate industry, and by independent
compensation consultants, as to other comparable companies. Not all companies
included in the National Association of Real Estate Investment Trust's
("NAREIT") All Equity Index described on page 10 are comparable in size and
complexity, and not all comparable real estate companies are real estate
investment trusts. Actual salaries are based on the executive's skill and
ability to influence the Company's financial performance and growth in both the
short-term and long-term. During 1995, the Compensation Committee used salary
survey data supplied by NAREIT and outside consultants in establishing base
salaries. The executive officers' salaries, including those of the CEO and COO,
were generally set at the mid range of the survey data.
BONUS COMPENSATION
All the Company's executive officers participate in a bonus program whereby
the individual is eligible for a bonus based on a percent of the individual's
base salary. This bonus program has been in effect for more than 15 years. The
bonus percentage is also based on competitive analysis. Again, the executive's
ability to influence the Company's success is considered in establishing this
percentage. Earned bonuses are determined annually on the basis of performance
against pre-established goals. Other than for the CEO and COO, the eligible
bonus percentage is allocated 50% to the Company's goals and 50% to the
individual's goals. Specific individual goals for each officer are established
at the beginning of the year and are tied to the functional responsibilities of
each executive. Individual goals include both objective financial measures as
well as such subjective factors as efficiency in managing capital resources,
successful acquisitions, good investor relations and the continued development
of management. The Company's goals are primarily based on operating
performance, as measured by factors such as the Company's funds from
operations, and achieving the appropriate growth objective, relating primarily
to portfolio acquisitions and new development. Other than the allocation
between individual and Company goals, no specific weights are assigned to the
individual goals. The bonuses of both the CEO and COO are based entirely on the
Company's performance. The individual and Company performance targets were met
in fiscal 1995 and consequently the executives were eligible for full bonus
awards.
SHARE INCENTIVE PROGRAM
The Compensation Committee strongly believes that by providing the executives
who have substantial responsibility for the management and growth of the
Company with an opportunity to increase their ownership of Common Shares of the
Company, the best interests of shareholders and executives will be closely
aligned. Therefore, executives are eligible to receive share options from time
to time, giving them the right to purchase Common Shares of the Company. The
number of options granted to an executive is based on practices of the same
comparable companies used to derive base salary levels. Share options
historically
8
<PAGE>
have not been a consistently utilized element of the Company's executive
compensation system, and the Company does not adhere to any firmly established
formulas or schedules for the issuance of options, but options are awarded when
considered appropriate.
CEO PERFORMANCE EVALUATION
For 1995, the Compensation Committee evaluated the CEO's performance based on
the Company's financial performance and its growth in real estate assets. The
Company achieved its funds from operations objective and achieved its goals for
its acquisition and new development programs by adding approximately 1.8
million square feet of income-producing properties to the portfolio with
returns in excess of 11%. Mr. S. Alexander received 100% of his potential bonus
based on the Company exceeding its corporate goals and objectives for 1995. Mr.
Alexander's compensation is awarded by the Compensation Committee without
reference to any specific performance factor or component (i.e. base salary,
bonus compensation and the share incentive program).
The report of the Compensation Committee shall not be deemed incorporated by
reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act of 1933, as amended (the
"Securities Act"), or under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), except to the extent that the Company specifically
incorporates this information by reference, and shall not otherwise be deemed
filed under such acts.
The foregoing report is given by the following members of the Compensation
Committee:
MELVIN A. DOW
STEPHEN A. LASHER
MARC SHAPIRO
9
<PAGE>
PERFORMANCE GRAPH
The following performance graph compares the performance of the Company's
Common Shares to the S&P 500 Index and to the published NAREIT All Equity Index
(excluding health care REIT's). The graph assumes that the value of the
investment in the Company's Common Shares and each index was 100 at December
31, 1990 and that all dividends were reinvested. The Company will provide upon
request the names of the companies included in the NAREIT All Equity Index.
COMPARISON OF FIVE-YEAR CUMULATIVE RETURN
[PASTEUP GRAPH]
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
- -------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
WRI 100 142 167 181 194 208
- -------------------------------------------------------------
S&P 500 Index 100 131 141 155 157 215
- -------------------------------------------------------------
The NAREIT All Equity Index* 100 136 155 186 192 221
</TABLE>
* (excluding health care REIT's)
The foregoing price performance comparisons shall not be deemed incorporated
by reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act or under the Exchange Act,
except to the extent that the Company specifically incorporates this graph by
reference, and shall not otherwise be deemed filed under such acts.
There can be no assurance that the Company's share performance will continue
into the future with the same or similar trends depicted in the graph above.
The Company will not make or endorse any predictions as to future share
performance.
10
<PAGE>
EXECUTIVE COMPENSATION
The following table lists, for each of the three years ended December 31,
1995, cash compensation paid to each of the Company's executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
------------------------------ ------------------------
SECURITIES
OTHER ANNUAL RESTRICTED UNDERLYING
SALARY BONUS COMPENSATION STOCK OPTIONS/SAR'S ALL OTHER
NAME YEAR ($) ($) ($)(1) AWARDS ($) (#)(2) COMPENSATION
---- ---- ------ ----- ------------ ---------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Stanford Alexander, 1995 $493,500 $235,000 $13,072(3)
Chairman and Chief 1994 470,000 235,000 $322,430 $666,000 120,000 13,598
Executive Officer 1993 440,000 220,000 138,500 14,000
Martin Debrovner, 1995 359,500 123,600 145,475(4)
President and Chief 1994 342,400 120,300 201,519 425,500 80,000 134,450
Operating Officer 1993 320,000 110,400 86,564 54,631
Joseph W. Robertson, Jr. 1995 278,250 65,000 44,195(5)
Executive Vice 1994 265,000 67,500 161,215 262,700 50,000 45,779
President and Chief 1993 250,000 75,000 69,250 32,062
Financial Officer
Andrew M. Alexander, 1995 213,150 75,000 34,722(6)
Executive Vice 1994 203,000 51,000 120,911 199,800 38,000 30,474
President/ 1993 190,000 47,500 51,938 16,360
Asset Management
John J. Marcisz, 1995 164,300 49,300 33,978(7)
Vice President/ 1994 156,500 47,000 111,000 3,000 30,162
Construction 1993 149,000 44,700 5,811
</TABLE>
- --------
(1) Represents amounts for federal income tax "gross-ups" for the share awards
granted and reported for prior periods.
(2) No SARs were granted during 1993, 1994 or 1995.
(3) Includes $8,452 of premiums paid by the Company under "split dollar" life
insurance agreements and $4,620 for the Company's contributions to the
Company's 401(k) Savings and Investment Plan (the "Savings Plan") on behalf
of Mr. S. Alexander.
(4) Includes $2,452 of premiums paid by the Company under "split dollar" life
insurance agreements, $4,620 for the Company's contributions to the
Company's Savings Plan on behalf of Mr. Debrovner, and $138,403 contributed
to the Company's Supplemental Retirement Plan.
(5) Includes $4,620 for the Company's contributions to the Company's Savings
Plan on behalf on Mr. Robertson, and $39,575 contributed to the Company's
Supplemental Retirement Plan.
(6) Includes $4,620 for the Company's contributions to the Company's Savings
Plan on behalf of Mr. A. Alexander and $30,102 contributed to the Company's
Supplemental Retirement Plan.
(7) Includes $4,620 for the Company's contributions to the Company's Savings
Plan on behalf of Mr. Marcisz and $29,358 contributed to the Company's
Supplemental Retirement Plan.
11
<PAGE>
SHARE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END VALUES
Shown below is information for the indicated persons with respect to the
options exercised during 1995 and the unexercised options to purchase the
Company's Common Shares granted during 1995 and prior years under the 1988 Plan
and the Incentive Plan.
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS HELD AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1995(#) DECEMBER 31, 1995
ACQUIRED ON VALUE ------------------------- -------------------------
NAME EXERCISE(#) RECEIVED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Stanford Alexander...... -- -- 16,666 128,334 $114,662 $162,938
Martin Debrovner........ -- -- 14,000 87,000 96,320 118,560
Joseph W. Robertson,
Jr..................... -- -- 12,000 56,000 82,560 85,289
Andrew M. Alexander..... -- -- 12,000 44,000 82,560 74,720
John J. Marcisz......... -- -- 10,000 21,200 94,000 21,200
</TABLE>
PENSION PLAN
The following table shows the approximate annual retirement benefits under
the Company's non-contributory pension plan (the "Pension Plan") (before the
reduction made for social security benefits) to eligible employees in specified
compensation and years of service categories, assuming retirement occurs at age
65 and that benefits are payable only during the employee's lifetime. Benefits
are not actuarially reduced where survivorship benefits are provided.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL BENEFITS UPON RETIREMENT
- -----------------------------------------------------------------------
YEARS OF SERVICE
AVERAGE ---------------------------------------------------------
COMPENSATION 15 20 25 30 35 40
- ------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$125,000 $ 28,125 $ 37,500 $ 46,875 $ 56,250 $ 65,625 $ 75,000
150,000 33,750 45,000 56,250 67,500 78,750 90,000
175,000** 39,375 52,500 65,625 78,750 91,875 150,000
200,000** 45,000 60,000 75,000 90,000 105,000 120,000
225,000** 50,625 67,500 84,375 101,250 118,125 135,000*
250,000** 56,250 75,000 93,750 112,500 131,250* 150,000*
300,000** 67,500 90,000 112,500 135,000* 157,500* 180,000*
400,000** 90,000 120,000 150,000* 180,000* 210,000* 240,000*
450,000** 101,250 135,000* 168,750* 202,500* 236,250* 270,000*
500,000** 112,500 150,000* 187,500* 225,000* 262,500* 300,000*
</TABLE>
- --------
* The maximum annual pension benefit which currently may be paid under a
qualified plan is $120,000 subject to certain grandfather rules for
limitation years beginning in 1995.
** Compensation in excess of $150,000 is disregarded with respect to plan years
beginning in 1995. Accordingly, the compensation of each executive officer
included in the Summary Compensation Table on page 11 which was covered by
the Pension Plan was limited to $150,000.
12
<PAGE>
The compensation used in computing average monthly compensation is the total
of all amounts paid by the Company as shown on the employee's W-2 Form, plus
amounts electively deferred by the employee under the Savings Plan and (S)125
cafeteria plan. Compensation in excess of $150,000 is disregarded. Credited
years of service for certain employees of the Company as of March 4, 1996 are
as follows: Mr. S. Alexander, 42 years; Mr. Debrovner, 28 years; Mr. Robertson,
24 years; Mr. A. Alexander, 18 years; and Mr. Marcisz, 16 years.
The Pension Plan covers all employees who are age 21 or over, with at least
one year of employment with the Company except leased employees and employees
covered by a collective bargaining agreement. The Pension Plan pays benefits to
an employee in the event of death, disability, retirement or other termination
of employment after the employee meets certain vesting requirements (generally
20% vesting after two years of service and an additional 20% vesting each year
thereafter until 100% vested). Under the Pension Plan, the amount of the
monthly retirement benefit payable beginning at age 65, the normal retirement
age, is equal to (i) 1.5% of average monthly compensation during five
consecutive years, within the last ten years, which would yield the highest
average monthly compensation multiplied by years of service rendered after age
21 (not in excess of 40 years), minus (ii) 1.5% of the monthly social security
benefits in effect on the date of retirement multiplied by years of service
rendered after age 21 and after July 1, 1976 (not in excess of 33.3 years).
PROPOSAL 2
RATIFICATION OF THE APPOINTMENT OF AUDITORS
The Board of Trust Managers has unanimously approved and urges you to vote
"FOR" approval of this Proposal 2. Proxies solicited hereby will be so voted
unless the shareholders specify otherwise in their proxies. The affirmative
vote of the holders of a majority of the Common Shares present in person or by
proxy at the Annual Meeting of Shareholders and entitled to vote is required
for approval of this proposal.
The Board of Trust Managers has appointed, and recommends the ratification
of, Deloitte & Touche llp as auditors for the Company for the year ending
December 31, 1996. This firm, or its predecessors, has served in such capacity
for the Company for more than 30 years and is familiar with the Company's
affairs and financial procedures. Ratification of their appointment as auditors
for the year ended December 31, 1995 was approved by the shareholders at the
Company's last Annual Meeting of Shareholders.
Representatives of Deloitte & Touche llp are expected to be present at the
Annual Meeting of Shareholders and will have an opportunity to make a
statement, if they desire to do so, and to respond to appropriate questions
from those attending the meeting.
13
<PAGE>
PROPOSAL 3
AMENDMENT OF THE WEINGARTEN REALTY 1993 INCENTIVE SHARE PLAN
The Company has established, and the shareholders have previously approved,
the Weingarten Realty Investors 1993 Incentive Share Plan (the "Incentive
Plan"). The Company has amended, subject to shareholder approval, the Incentive
Plan to increase the number of Common Shares available thereunder from 500,000
to 1,000,000. The Board of Trust Managers has unanimously approved and urges
you to vote "FOR" the approval of an amendment to the Incentive Plan. The Board
of Trust Managers believes that the Company's long term success is dependent
upon the ability of the Company to attract and retain outstanding individuals
who, by virtue of their ability and qualifications, make important
contributions to the Company. The amendment to the Incentive Plan will enable
the Company to continue its ability to provide key employees with meaningful
awards and incentives commensurate with their contributions and competitive
with those offered by other employers. Proxies solicited hereby will be voted
in favor of this Proposal 3 unless the shareholders specify otherwise in their
proxies. The favorable vote of the holders of a majority of the outstanding
Common Shares present in person or by proxy at the Annual Meeting of
Shareholders is required for adoption of this proposal.
The Incentive Plan allows the grant of share options, share appreciation
rights ("SAR's"), performance awards and share grants and provides for a
termination date of December 31, 2002. The number of Common Shares that may be
issued pursuant to the exercise of share options, SAR's, performance awards and
share grants granted under the Incentive Plan is subject to certain adjustments
to prevent dilution. The terms of the Incentive Plan are described below, and
the Incentive Plan, including the proposed amendment, is set forth in its
entirety as Appendix A hereto.
Options, SARs, performance awards and share grants may be granted under the
Incentive Plan only to full time employees of the Company who, in the opinion
of the Compensation Committee, have substantial executive or administrative
responsibility in the management or development of the business of the Company.
The individuals who shall be eligible to receive Awards under the Plan shall be
such key employees of WRI or any Affiliate as the Compensation Committee from
time to time shall determine. Share options granted under the Incentive Plan
may be either Incentive Stock Options ("ISOs") under the provisions of Section
422 of the Code or Nonqualified Stock Options ("NSOs").
The Incentive Plan is administered by the Company's Compensation Committee,
which, under the terms of the Incentive Plan, must consist of disinterested
persons within the meaning of Rule 16b-3 of the Securities Exchange Act of
1934, as amended. The Compensation Committee has complete discretion in
determining the key executives and employees of the Company or its affiliates
who shall receive share options, SARs, performance awards and share grants and
the number of such options, SARs, performance awards and shares to be granted.
The Incentive Plan provides that, in making grants, the Compensation Committee
shall take into consideration the contribution the employee has made or may
make to the success of the Company or its affiliates and such other factors as
the Compensation Committee shall determine. The Incentive Plan permits the
Compensation Committee, at its discretion, to fix performance objectives
related to a participant's job responsibilities, conditioning the right to
exercise a share option or the vesting of a share award or
14
<PAGE>
performance award upon achievement of the performance objectives. The granting
of a share option, SAR, share award or performance award does not confer upon
the participant any right to remain in the employ of the Company.
The Compensation Committee has the discretion to grant an SAR in tandem with
any option or may grant an SAR independently. An SAR entitles a participant to
surrender an SAR to the Company and to receive in exchange therefor the number
of Common Shares having an aggregate value equal to the excess of the fair
market value of one share on the date of exercise over the purchase price per
share specified in such SAR, times the number of shares called for by the SAR
(or portion thereof) surrendered. In addition, the Compensation Committee may
elect to settle the Company's obligation with respect to the exercise of an SAR
by the payment of cash equal to the aggregate fair market value of the shares
it would otherwise be obligated to give. Any such SAR is subject to such terms
and conditions, not inconsistent with the Incentive Plan, as the Compensation
Committee may impose. Any SAR granted in tandem with an option is only
exercisable to the extent that the related option is exercisable. Further, an
SAR is only exercisable upon consent of the Compensation Committee. Limited
SARs payable upon the occurrence of a change in control (as defined in the
Incentive Plan) may be granted under the plan.
Each ISO granted under the Incentive Plan shall expire not more than 10 years
after the date of its grant, and each NSO granted under the Incentive Plan
shall expire not more than 10 years after its grant. An SAR not granted in
tandem with a share option shall expire not more than 10 years from the date of
its grant, and an SAR granted in tandem with a share option shall expire or
terminate whenever the option to which it relates expires or terminates. Share
awards and performance awards may be subject to a vesting period as set by the
Compensation Committee at the time of grant.
The plan provides that upon the occurrence of a change in control (as defined
in the Incentive Plan) all awards vest in full. All share options shall expire
upon an optionee's termination of employment with the Company for any reason
other than death, except that the Compensation Committee may, in its
discretion, grant an option which permits the exercise for up to 36 months
after the optionee's retirement or disability or for periods up to three months
following other reasons for termination of employment, and no more than ten
years after the date the option was granted. Upon an optionee's termination of
employment by reason of death, the optionee's options, to the extent then
exercisable, may be exercised for a period of up to 36 months after the date of
the optionee's death, but no more than ten years after the date an option was
granted.
The option price for each share option is determined by the Compensation
Committee, but may not be less than the greater of (a) the fair market value of
the Common Shares of the Company on the date of grant or (b) the par value of
the shares subject to the share option. However, non-qualified stock options
may be granted at less than the fair market value of the Common Shares of the
Company on the date of grant (but not less than $0.03 per share, the par value
of the Common Shares). Options may be issued under the plan that contain a
provision that the option exercise price is automatically adjusted to the then
fair market value of the Common Shares on certain dates more than three years
after grant if such current value is more than 25% below the option exercise
price. The payment of the option exercise price may be in cash or Common
15
<PAGE>
Shares previously purchased. The Compensation Committee may provide that the
Company will loan the option exercise price to optionees.
An option grant may include a "reload option", which provides that upon the
exercise of an option, a replacement option, with an exercise price equal to
the then fair market value of a Common Share and the same expiration date as
the option exercised, equal to the number of shares tendered to pay the
exercise price, or equal to the number of shares issued upon exercise, will be
granted to the optionee. The Incentive Plan permits the Company to allow an
optionee, upon exercise of an option or vesting of an award, to satisfy any
applicable federal income tax requirements in the form of either cash or Common
Shares, including Common Shares issuable upon exercise of such option.
The Incentive Plan provides for share awards which may be share grants or
contingent or restricted share awards based on time and conditions set by the
Compensation Committee. The plan also provides for performance awards, which
may be settled in either cash or Common Shares based upon the fulfillment of
criteria established by the Compensation Committee. No Common Shares may be
issued pursuant to any award under the plan prior to the payment of cash equal
to the par value per Common Share to the Company by the Participant.
The Board of Trust Managers of the Company may amend the Incentive Plan at
any time, except that any amendment that affects the aggregate number of shares
that may be issued under share options, SARs, performance awards and share
grants awarded pursuant to the Incentive Plan or the material terms of the
awards granted pursuant to the Incentive Plan, would require shareholder
approval. The Plan allows the Compensation Committee, with the consent of an
optionee, to amend outstanding options or exchange outstanding options for
replacement options. Unless previously terminated by the Board of Trust
Managers, the Incentive Plan will terminate on December 31, 2002.
Federal Income Taxes. As a general rule, no income will be recognized by an
employee upon the grant of either ISOs or NSOs. Upon the exercise of a NSO, the
employee will be treated as receiving compensation income in an amount equal to
the excess of the fair market value of the shares at the time of exercise over
the option price paid for the shares, and the Company may claim a deduction for
compensation paid in the same amount and at the same time as compensation is
taxable to the employee, provided the Company makes the proper tax withholding
with respect to the exercise by an employee and the amount of such compensation
is reasonable under the Code. Upon a subsequent disposition of the shares, any
difference between the fair market value of the shares at the time of exercise
and the amount realized on the disposition would be eligible for treatment as
long-term capital gain or loss if the shares were held for more than twelve
months. The exercise of an ISO, on the other hand, does not subject the
optionee to federal income tax; however, the "spread" upon the exercise of an
ISO is an item of adjustment for purposes of the alternative minimum tax. If
the optionee holds the Common Shares received upon the exercise of an ISO for
the requisite ISO holding period, gain on the disposition of such shares is
treated as long-term capital gain. If a disposition of such shares is made in a
taxable transaction before expiration of the ISO holding period, a portion of
the gain on disposition will be treated as ordinary income and the balance as
long-term or short-term capital gain,
16
<PAGE>
depending on the length of time the shares were held. The Company is allowed a
deduction in the year of disposition of shares received upon exercise of an ISO
only to the extent the amount of any gain is taxable to the optionee as
ordinary income.
An optionee who receives an SAR will not recognize any taxable income upon
receipt of the SAR, but upon exercise of the SAR, the fair market value of the
Common Shares (or the cash in lieu of Common Shares) received must be treated
as ordinary income by the optionee for that year. Under such circumstances, the
Company will, in general, be entitled to a deduction equal to the amount
taxable to the optionee as ordinary income. If the optionee receives Common
Shares upon the exercise of an SAR and thereafter disposes of such shares in a
taxable transaction, the difference between any amount realized on such
disposition and the amount treated as ordinary income upon the exercise of the
SAR will be treated as a capital gain or loss (provided the Common Shares were
held as a capital asset on the date of disposition), which will be a long or
short-term capital gain or loss depending on the holding period of the Common
Shares, and taxed at the same rate as ordinary income.
In general, no income will be recognized by an employee upon the receipt of a
restricted share grant or a performance award. On the date (i) the award is
settled in cash, in the case of certain performance awards, or (ii) the shares
granted or issued under other share awards, become either transferable by the
employee or no longer subject to a substantial risk of forfeiture, the employee
will be treated as receiving compensation income in an amount equal to the cash
received or the then fair market value of the shares, as applicable, and the
Company will be entitled to a deduction in the same amount, provided that it
makes the proper tax withholding and the amount is reasonable compensation
under the Code.
The exercise of an NSO by, the payment of an SAR with Common Shares to, or
the vesting of a restricted share grant to, an employee subject to the
provisions of Section 16(b) of the Exchange Act will be a taxable event on the
date of such event. A nonrestricted share grant to an employee who is subject
to the provisions of Section 16(b) will generally not be a taxable event until
the earlier of six months after such event or the date such employee ceases to
be subject to Section 16(b) and the amount of compensation income will be
measured by the value of the Common Shares on such later date. A taxable event
relating to the vesting of a contingent or restricted share award or the
payment of a performance unit or performance shares will be either the date of
such payment or the earlier of six months after such date or the date such
employee ceases to be subject to Section 16(b), depending upon the terms of
such awards.
17
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Company's Compensation Committee are Messrs. Dow, Lasher
and Shapiro. Mr. Shapiro, an executive officer and director of TCB, serves on
the Compensation Committee. The Company and certain of its joint ventures are
depositors with TCB. Additionally, the Company has entered into a $200 million
syndicated revolving credit agreement of which TCB participates in an amount of
$73 million and is the agent for the syndication. As of December 31, 1995,
$73.5 million was outstanding under such agreement. From time to time, the
Company has made short-term borrowings from independent third parties which
were arranged through TCB. The principal amount of such borrowings, which did
not exceed $47.1 million during 1995, was secured by government-backed
securities owned by the Company. TCB is also the trustee under the grantor
trust, which holds certain employee deferred compensation funds.
Weingarten Properties Trust ("WPT"), a Texas real estate investment trust
that owns five shopping centers and also currently qualifies as a REIT, shares
certain common officers and/or Board members with the Company. Messrs. S.
Alexander, Debrovner, Dow, Lasher, Robertson, A. Alexander and Marcisz are
officers and/or directors of WPT. During 1995, the Company borrowed funds from
WPT pursuant to a short-term unsecured note for short-term investment of WPT's
excess cash. Interest on funds advanced from WPT to the Company accrues at the
30-day certificate of deposit rate and ranged from 2.7% to 4.0% during 1995.
The largest amount owed by the Company during 1995 was $700,000. During the
year, the Company repaid all funds previously borrowed from WPT. The Company
then advanced funds to WPT to fund certain capital needs of WPT under a short-
term unsecured note bearing interest at the prime rate plus 1%, which ranged
from 9.5% to 10.0% during the year. As of December 31, 1995, WPT owed the
Company $700,000 which was the largest amount owed to the Company during the
year. During 1995, the Company paid WPT $3,543 in interest on the funds
advanced and WPT paid the Company $35,930 in interest on funds borrowed.
The Company currently owns 77% of the outstanding common stock of WPT. The
Company may, in the future, attempt to acquire the remaining stock ownership of
WPT through negotiated or open market purchase or by means of a tender offer or
a business combination.
The Company also contracts to manage the day-to-day business and properties
of WPT. WPT paid the Company approximately $226,000 during 1995 for the
management of its properties and the operation of its business.
Messrs. S. Alexander, A. Alexander, Debrovner, Dow, Lasher, Marcisz and
Schnitzer are shareholders or officers and/or directors of WRI Holdings, Inc.,
a Texas corporation ("Holdings"). In December 1984, the Company contributed
certain assets and cash to Holdings in exchange for, among other consideration,
$26.8 million original principal amount of debt securities (the "Holdings Debt
Securities") and common stock of Holdings. The assets contributed by the
Company to Holdings included unimproved land in the Railwood Industrial Park in
northeast Houston ("Railwood"), and all of the issued and outstanding capital
stock of Plaza Construction, Inc. ("Plaza") and Leisure Dynamics, Inc.
("Leisure Dynamics"). The Holdings Debt Securities were issued pursuant to
three separate trust indentures and originally consisted of $16.7 million
principal amount of debt securities (the "Hospitality Bonds") due December 28,
2004, $7.0 million principal amount of debt securities (the "Railwood Bonds")
due December 28, 2004 and $3.2 million principal amount
18
<PAGE>
of debt securities (the "Plaza Bonds") due December 28, 1994. The Plaza Bonds
were extended and are currently due December 28, 1996.
Interest must be paid on the outstanding principal amount of the Hospitality
Bonds at a rate equal to the greater of 16% per annum or 11% of Holdings' pro
rata share of the gross revenues per year from the hotels owned by the
Hospitality Ventures ("Hospitality"), but not more than 18%, the maximum lawful
rate in Texas applicable to the Hospitality Bonds. The Hospitality Bonds were
structured so that the Company would, under certain circumstances, receive
interest income based on the revenues of the Hospitality Ventures. In August
1995, Hospitality sold seven of the eight hotels it owned. The proceeds were
remitted to the Company through Holdings, reducing the principal amount
outstanding (net of deferred gain) to $2.7 million as of December 31, 1995. As
of March 4, 1996, $2.7 million remained outstanding under the Hospitality
Bonds.
As of March 4, 1996, the outstanding principal amounts owing on the Railwood
Bonds and the Plaza Bonds were $6.2 million and $3.2 million, respectively.
Interest on both bonds accrues at the rate of 16% per annum (the "accrual
rate"), but is due and payable quarterly at the rate of 10% per annum (the "pay
rate"). The difference between the accrual rate and the amount of interest paid
by Holdings at the pay rate on such debt securities is treated as unpaid
accrued interest, which will not accrue any compound interest and is payable
with the principal at maturity. The Company recognizes as interest income only
the amount actually received at the pay rate. Therefore, the Company does not
carry the difference between the accrual rate and the pay rate as an asset on
the Company's Consolidated Balance Sheet. Such nonrecognized accrued interest
outstanding as of December 31, 1995 under the Railwood and Plaza Bonds was $4.5
million and $2.1 million, respectively.
Pursuant to a loan agreement between Holdings and the Company and pursuant to
a note, dated December 28, 1984, as amended in October 1987, January 1991 and
March 1994 (the "Accrual Note"), Holdings may borrow from the Company the
amount necessary, up to a maximum of $30 million, to enable Holdings to pay the
interest owing on the Holdings Debt Securities. Interest on the Accrual Note
accrues at the highest rate per annum permitted by Texas law as to a portion of
the debt and at the TCB prime rate plus 2% per annum (but not in excess of the
maximum legal rate) as to the balance of the debt. The Accrual Note is payable
December 28, 2004. As of December 31, 1995, $23.7 million was outstanding under
the Accrual Note, which represents the difference between the amount recognized
as interest income on the Holdings Debt Securities and the pay rate applicable
to such bonds, i.e., the Company did not recognize as income that portion of
the pay rate interest received by the Company which had been borrowed by
Holdings under the Accrual Note.
In November 1982, the Company entered into a loan agreement (the "River
Pointe Loan Agreement"), which was amended effective December 1, 1991, with
River Pointe Venture I, a joint venture in which Plaza was a joint venture
partner until October 1987, at which time Plaza acquired all the joint venture
interest in such venture owned by the other joint venture partner and became
the successor of such joint venture under the River Pointe Loan Agreement.
Under the terms of the River Pointe Loan Agreement, the Company may lend Plaza
up to $12 million for construction and development of River Pointe. Interest
accrues at the prime
19
<PAGE>
rate plus 1%, but not in excess of the maximum rate permitted by law, and
payment of the outstanding principal balance is due December 1, 1996. As of
December 31, 1995, the principal amount outstanding under the River Pointe Loan
Agreement was $9.3 million plus accrued interest of $6.4 million.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's officers, trust
managers, and persons who own more than 10 percent of the Company's Common
Shares, to file initial reports of ownership and reports of changes in
ownership (Forms 3, 4 and 5) of Common Shares with the Securities and Exchange
Commission ("SEC") and the New York Stock Exchange. Officers, trust managers
and greater than 10 percent holders are required by SEC regulation to furnish
the Company with copies of all such forms that they file.
The Company believes that during the fiscal year ended December 31, 1995, all
Section 16(a) filing requirements applicable to its officers, trust managers
and greater than 10 percent beneficial owners were complied with.
SHAREHOLDER PROPOSALS
Shareholder proposals to be presented at the next Annual Meeting of
Shareholders must be in writing and received at the Company's principal
executive office by the Company's Secretary no later than November 25, 1996, in
order to be included in the next year's proxy statement.
OTHER BUSINESS
The trust mangers of the Company know of no matters expected to be presented
at the Annual Meeting of Shareholders other than those described above;
however, if other matters are properly presented to the meeting for action, it
is intended that the persons named in the accompanying form of proxy, and
acting thereunder, will vote in accordance with their best judgment on such
matters.
20
<PAGE>
FORM 10-K REPORT
UPON THE WRITTEN REQUEST OF EACH SHAREHOLDER SOLICITED HEREBY, ADDRESSED TO
THE COMPANY, ATTENTION: M. CANDACE DUFOUR, SECRETARY, 2600 CITADEL PLAZA DRIVE,
HOUSTON, TEXAS 77008, THE COMPANY WILL PROVIDE WITHOUT CHARGE A COPY OF ITS
ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES
THERETO, REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 13A-1 UNDER THE SECURITIES EXCHANGE ACT OF 1934 FOR THE YEAR
ENDED DECEMBER 31, 1995. ANY BENEFICIAL OWNER MAKING SUCH A REQUEST MUST SET
FORTH THEREIN A GOOD-FAITH REPRESENTATION THAT AS OF MARCH 4, 1996 HE WAS A
BENEFICIAL OWNER OF THE COMPANY'S SECURITIES ENTITLED TO VOTE AT THE ANNUAL
MEETING OF SHAREHOLDERS.
By order of the Board of Trust
Managers
M. CANDACE DuFOUR
Vice President and Secretary
Dated March 26, 1996
Houston, Texas
21
<PAGE>
APPENDIX A
WEINGARTEN REALTY INVESTORS
AMENDED
1993 INCENTIVE SHARE PLAN
1. PURPOSE
The purpose of the Weingarten Realty Investors 1993 Incentive Share Plan (the
"Plan") is to advance the interests of Weingarten Realty Investors ("WRI" or
the "Company"), a Texas real estate investment trust, and its Affiliates (as
defined below) by providing share ownership opportunities to certain key
employees of WRI and its Affiliates who contribute significantly to the
performance of WRI. In addition, the Plan is intended to enhance the ability of
WRI and its Affiliates to attract and retain individuals of superior managerial
ability and to motivate such key employees to exert their best efforts toward
future progress and profitability of WRI.
For purposes of the Plan, an Affiliate shall be any corporation in which WRI
has a direct or indirect ownership interest of 50% or more of the total
combined voting power of all classes of stock of such corporation.
2. ADMINISTRATION AND INTERPRETATION
a. Administration. The Plan shall be administered by a committee (the
"Committee") consisting of not less than three members of the Board of Trust
Managers (the "Board") of WRI appointed by and serving at the pleasure of the
Trust Managers. All members of the Committee shall be "disinterested persons"
within the meaning of Rule 16b-3 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended. The Board may from time to time
remove and appoint members of the Committee in substitution for or in addition
to members previously appointed and may fill vacancies, however caused, in the
Committee. The Committee may prescribe, amend and rescind rules and regulations
for administration of the Plan and shall have full power and authority to
construe and interpret the Plan. A majority of the members of the Committee
shall constitute a quorum, and the acts of a majority of the members present at
a meeting or the acts of a majority of the members evidenced in writing shall
be the acts of the Committee. The Committee may correct any defect or any
omission or reconcile any inconsistency in the Plan or in any award or grant
made hereunder in the manner and to the extent it shall deem desirable.
The Committee shall have the full and exclusive right to grant all share
options ("Options"), share appreciation rights ("SARs"), share awards, which
may be awards of unrestricted shares or restricted shares ("Restricted
Shares"), performance units ("Performance Units") and performance shares
("Performance Shares") under the Plan. The Options, SARs, share awards,
Performance Units and Performance Shares are collectively referred to as
"Awards." In granting Awards, the Committee shall take into consideration the
contribution the employee has made or may make to the success of WRI or its
Affiliates and such other factors as the Committee shall determine. The
Committee shall also have the authority to consult with and receive
recommendations from officers and other employees of WRI and its Affiliates
with regard to these
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matters. In no event shall any employee, his legal representatives, heirs,
legatees, distributees, or successors have any right to participate in the Plan
except to such extent, if any, as the Committee shall determine.
The Committee may from time to time in granting Awards under the Plan
prescribe such other terms and conditions concerning such Awards as it deems
appropriate, including, without limitation, the achievement of specific goals
established by the Committee, provided that such terms and conditions are not
more favorable to an employee than those expressly set forth in the Plan.
The day-to-day administration of the Plan may be carried out by such officers
and employees of WRI or its Affiliates as shall be designated from time to time
by the Committee.
b. Interpretation. The interpretation and construction by the Committee of
any provisions of the Plan or of any grant under the Plan and any determination
by the Committee under any provision of the Plan or any such grant shall be
final and conclusive for all purposes.
c. Limitation on Liability. Neither the Committee nor any member thereof
shall be liable for any act, omission, interpretation, construction or
determination made in connection with the Plan in good faith, and the members
of the Committee shall be entitled to indemnification and reimbursement by WRI
in respect of any claim, loss, damage or expense (including counsel fees)
arising therefrom to the full extent permitted by law. The members of the
Committee shall be named as insureds under any directors and officers (or
similar) liability insurance coverage which WRI may have in effect from time to
time.
3. SHARES SUBJECT TO GRANTS UNDER THE PLAN
a. Limitation on Number of Shares. The shares subject to grants of Awards
shall be authorized but unissued common shares of beneficial interest, $.03 par
value, in WRI ("Shares"), and such Shares, if any, held as "treasury stock" by
WRI. Subject to adjustment as hereinafter provided, the aggregate number of
Shares as to which Awards may be granted under the Plan shall not exceed
1,000,000.
Shares ceasing to be subject to an Award because of the exercise of an Option
or SAR or the vesting of an Award shall no longer be subject to any further
grant under the Plan. However, if any outstanding Option or SAR, in whole or in
part, expires or terminates unexercised or is cancelled or any Award, in whole
or in part, expires or is terminated or forfeited, for any reason prior to
January 1, 2003, the Shares allocable to the unexercised, terminated, cancelled
or forfeited portion of such Award may again be made the subject of grants
under the Plan; provided, however, that if the participant receives the
benefits of ownership of any Shares (which includes the receipt of dividends,
but does not include the right to vote such Shares), such Shares may not again
be made the subject of grants under the Plan.
b. Adjustments of Aggregate Number of Shares. The aggregate number of Shares
stated in Section 3.a. shall be subject to appropriate adjustment, from time to
time, in accordance with the provisions of Section 9 hereof.
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4. ELIGIBILITY
The individuals who shall be eligible to receive Awards under the Plan shall
be such key employees of WRI or any Affiliate as the Committee from time to
time shall determine.
5. OPTIONS AND SARS
a. Grants of Options. Options granted under the Plan may be either incentive
stock options ("ISO's") or nonqualified stock options. The term ISO shall mean
an option which is intended to qualify as an incentive stock option under
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). With
respect to an Option that is intended to be an ISO, the aggregate Market Value
Per Share (as hereinafter defined) (determined at the date such Option was
granted) of the Shares with respect to which such ISO is exercisable for the
first time by the optionee during any calendar year (under all such plans of
WRI and its parent and subsidiary corporations) shall not exceed $100,000.
No ISO shall be granted to any person who, at the time of the grant, owns
Shares possessing more than 10% of the total combined voting power of WRI or
any parent or subsidiary of WRI, unless (i) on the date such ISO is granted the
option price is at least 110% of the Market Value Per Share of the Shares
subject to the ISO and (ii) such ISO by its terms is not exercisable after the
expiration of five years from the date such ISO is granted.
Options granted under the Plan shall be of such type (i.e., a nonqualified
stock option or an ISO), for such number of Shares, and be subject to such
terms and conditions, which may include, without limitation, the achievement of
specific goals, as the Committee shall designate. Options may be granted by the
Committee to any individual eligible to receive the same at any time and from
time to time.
b. Grants of SARs. The term SAR shall mean the right to receive from WRI an
amount equal to (i) the Market Value Per Share on the exercise date, over (ii)
the Market Value Per Share on the date of grant (i.e., the "spread"),
multiplied by the total number of Shares for which the SAR is exercised. The
amount payable by WRI upon the exercise of a SAR may be paid in cash or in
Shares or in any combination thereof as the Committee in its sole discretion
shall determine; however, no fractional Shares shall be issuable pursuant to
any SAR and no Shares shall be issued upon the exercise of an SAR until an
amount equal to, at the minimum, the par value per Share multiplied by the
number of Shares to be issued has been paid to WRI.
SARs may be granted by the Committee to any individual eligible to receive
the same at any time and from time-to-time before January 1, 2003. A SAR may,
but need not, relate to a specific Option granted under this Plan. If a SAR
relates to a specific Option, it may be granted either concurrently with the
Option or, if a non-qualified stock option, at any time prior to the exercise,
termination, cancellation or expiration of such Option.
The Committee may fix such waiting periods, exercise dates or other
limitations as it shall deem appropriate with respect to SARs granted under the
Plan including, without limitation, the achievement of
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specific goals; provided, however, that each SAR granted hereunder shall be
exercisable only upon consent of the Committee; and provided further, that a
SAR that relates to a specific Option shall be exercisable only when and to the
extent that the Option to which it relates is exercisable and if such Option is
an ISO, only at such times that there is a positive spread.
c. Terms of Options and SARs. Options and SARs granted pursuant to this Plan
shall be evidenced by written agreements (separate agreements shall be used
with respect to grants of nonqualified stock options and grants of ISO's) which
shall comply with and be subject to the following terms and conditions and may
contain such other provisions, consistent with the terms of this Plan, as the
Committee shall deem advisable. SARs that relate to a specific Option may be
evidenced by and form a part of the Option agreement to which the SAR relates.
References herein to agreements shall include, to the extent applicable, any
amendments to such agreements.
(1) Payment of Option Exercise Price. Upon exercise of an Option, the full
option purchase price for the Shares with respect to which the Option is being
exercised shall be payable to WRI (i) in cash or by check payable and
acceptable to WRI or (ii) subject to the approval of the Committee, by
tendering to WRI Shares owned by the optionee having an aggregate Market Value
Per Share as of the date of exercise and tender which is not greater than the
full option purchase price for the Shares with respect to which the Option is
being exercised and by paying the remainder of the option purchase price as
provided in (i) above; however, the Committee may, upon confirming that the
optionee owns the number of additional Shares being tendered, authorize the
issuance of a new certificate for the number of Shares being acquired pursuant
to the exercise of the Option less the number of Shares being tendered upon the
exercise and return to the optionee (or not require surrender of) the
certificate for the Shares being tendered upon the exercise. Payment
instructions will be received subject to collection. If permitted by applicable
law, the Committee may provide that the Company may make loans to recipients of
Options in order to pay the Option exercise price. Such loans may be subject to
such terms and conditions as determined by the Committee.
(2) Number of Shares. Each agreement shall state the total number of Shares
which are subject to the Option and/or SAR.
(3) Exercise Price. The exercise price for each ISO and SAR shall be fixed by
the Committee at the date of grant, but in no event may such exercise price per
Share be less than the Market Value Per Share on the date of the grant of the
ISO or SAR.
The exercise price for each nonqualified stock option shall be fixed by the
Committee at the date of grant. Such option price may be less than the Market
Value Per Share on the date of the grant of the nonqualified stock option, but
in no event shall the option price be less than the par value of a Share.
(4) Market Value Per Share. The Market Value Per Share as of any particular
date shall be determined by any fair and reasonable means determined by the
Committee.
(5) Term. The term of each Option and SAR shall be determined by the
Committee at the date of grant; provided, however, that each Option that is an
ISO shall, notwithstanding anything in the Plan or an
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agreement to the contrary, expire not more than ten years from the date the
Option is granted (except as provided in Section 5.a.) or, if earlier, the date
specified in the agreement at the date of grant of such Option. An Option that
is a nonqualified stock option shall expire not more than ten years from the
date the Option is granted, or if earlier, the date specified in the agreement
at the date of grant of such Option. A SAR not granted in tandem with an Option
shall expire not more than ten years from the date the SAR is granted or, if
earlier, the date specified in the SAR agreement; however, a SAR granted in
tandem with an Option shall terminate whenever the Option to which it relates
terminates.
(6) Date of Exercise. Each agreement may, in the discretion of the Committee,
state that the Option or SAR granted therein may not be exercised in whole or
in part for a period or periods of time specified in such agreement and except
as so specified therein, any Option or SAR may be exercised in whole at any
time or in part from time to time during its term. The Committee may, in its
discretion, accelerate the exercisability of all or part of an individual's
Options or SARs.
(7) Termination of Employment. In the event that an individual's employment
with WRI and its Affiliates shall terminate, for reasons other than (i)
retirement pursuant to a retirement plan or policy of WRI or one of its
Affiliates ("retirement"), (ii) permanent disability as determined by the
Committee based on the opinion of a physician selected or approved by the
Committee ("permanent disability") or (iii) death, the individual's Options and
SARs shall be exercisable by him, subject to subsections (5) and (6) above,
only within three months after such termination, but only to the extent the
Option or SAR was exercisable immediately prior to such termination of
employment.
If, however, any termination of employment is due to retirement or permanent
disability, the individual shall have the right, subject to the provisions of
subsections (5) and (6) above, to exercise his Option and SARs at any time
within the 36-month period commencing on the day next following after such
termination of employment to the extent that the individual was entitled to
exercise the same on the day immediately prior to such termination. Whether any
termination of employment is due to retirement or permanent disability and
whether an authorized leave of absence or absence on military or government
service or for other reasons shall constitute a termination of employment for
the purposes of the Plan shall be determined by the Committee.
If an individual shall die while entitled to exercise an Option or SAR, the
individual's estate, personal representative or beneficiary, as the case may
be, shall have the right, subject to the provisions of subsections (5) and (6)
above, to exercise the Option at any time within 36 months from the date of the
optionee's death, to the extent that the optionee was entitled to exercise the
same on the day immediately prior to the optionee's death.
d. Options Granted by Other Corporations. Options may be granted under the
Plan from time to time in substitution for stock options held by employees of
corporations who become key employees of WRI or of any Affiliate as a result of
any "corporate transaction" as defined in the Treasury Regulations promulgated
under Section 424 of the Code.
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e. Reload Options. An option may, in the discretion of the Committee, include
a reload option right which shall entitle the optionee, upon (i) the exercise
of such original option prior to the optionee's termination of employment and
(ii) payment of the appropriate exercise price in Shares that have been owned
by such optionee for at least six months prior to the date of exercise, to
receive a new option (the "Reload Option") to purchase, at the Market Value Per
Share on the date of the exercise of the original option, the number of Shares
equal to the number of whole shares delivered by the optionee in payment of the
exercise price of the original option. A Reload Option may also allow, that
upon the exercise of an option, the optionee may receive a new option to
purchase at the Market Value Per Share on the date of exercise of the original
option, the number of Shares equal to the number of Shares issued upon exercise
of the original option. Such Reload Option shall be subject to the same terms
and conditions, including expiration date, and shall be exercisable at the same
time or times as the original option with respect to which it is granted,
except that in no event shall such Reload Option be exercisable within six
months of its date of grant.
f. Amendment. The Committee may, with the consent of the person or persons
entitled to exercise any outstanding option, amend such option. The Committee,
in its absolute discretion, may grant to holders of outstanding options, in
exchange for the surrender and cancellation of such options, new options having
exercise prices lower (or higher) than the exercise price provided in the
options so surrendered and canceled and containing such other terms and
conditions as the Committee may deem appropriate.
6. SHARE AWARDS
a. Awards of Shares. Shares may be awarded by the Committee to any individual
eligible to receive the same, at any time and from time to time before January
1, 2003. An award may be a (i) a grant of Shares, (ii) contingent award of
Shares to be issued to the employee in the future after the employee has met
the terms and conditions of the contingent award set by the Committee at the
time of the contingent award or (iii) a Restricted Share Award. All awards of
Shares shall provide that, prior to the issuance of any Shares to any
individual, such individual shall pay to WRI an amount of cash equal to, at a
minimum, the par value per Share multiplied by the number of Shares to be
issued.
b. Description of Share Awards. A Restricted Share is a share that may not be
sold, exchanged, pledged, transferred, assigned or otherwise encumbered or
disposed of until the terms and conditions set by the Committee at the time of
the award of the Restricted Shares have been satisfied. A Share award shall be
subject to such restrictions, terms and conditions as the Committee may
establish, which may include, without limitation, "lapse" and "non-lapse"
restrictions (as such terms are defined in regulations promulgated under
Section 83 of the Code) and the achievement of specific goals.
If an employee receives a Share award (whether or not escrowed as provided
below), the employee shall be the record owner of such Shares and shall have
all the rights of a shareholder with respect to such Shares (unless the
agreement specifically provides otherwise), including the right to vote and the
right to receive dividends or other distributions made or paid with respect to
such Shares. Any certificate or certificates representing a Share award which
is a contingent award or a Restricted Share award shall bear a legend similar
to the following:
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The shares represented by this certificate have been issued pursuant to the
terms of the Weingarten Realty Investors 1993 Incentive Share Plan and may
not be sold, pledged, transferred, assigned or otherwise encumbered in any
manner except as is set forth in the terms of such award dated , 199 .
In order to enforce the restrictions, terms and conditions that may be
applicable to an employee's Share award, the Committee may require the
employee, upon the receipt of a certificate or certificates representing such
shares, or at any time thereafter, to deposit such certificate or certificates,
together with stock powers and other instruments of transfer, appropriately
endorsed in blank, with WRI or an escrow agent designated by WRI under an
escrow agreement, which may be a part of a Restricted Share agreement, in such
form as shall be determined by the Committee.
After the satisfaction of the terms and conditions set by the Committee at
the time of a Share award to an employee, which award is not subject to a non-
lapse feature, a new certificate, without the legend set forth above, for the
number of shares that are no longer subject to such restrictions, terms and
conditions shall be delivered to the employee. If such terms and conditions are
satisfied as to a portion, but fewer than all, such Shares, the remaining
shares issued with respect to such award shall either be reacquired by WRI or,
if appropriate under the terms of the award applicable to such shares, shall
continue to be subject to the restrictions, terms and conditions set by the
Committee at the time of award.
c. Payment of Share Awards. The satisfaction of the terms and conditions set
by the Committee at the time of an award and the delivery of a certificate,
without the legend set forth above, for the portion of such award that is no
longer subject to such restrictions, terms and conditions is hereinafter
referred to as the "payment" of such portion of the award. Subject to the
provisions above, each award shall be paid at the time and in the manner
specified by the Committee at the time of the award.
d. Payment in the Event of Termination of Employment. If the employment with
WRI and its Affiliates of an employee to whom a Share award has been made is
terminated for any reason before satisfaction of the terms and conditions for
the payment of all or a portion of the award, then only such portion of the
award, if any, that is payable pursuant to its terms and conditions as of the
date of the employee's termination shall be paid, and the remaining portion of
such award shall be reacquired by WRI and forfeited; provided, however, if the
termination is due to the employee's death, permanent disability or retirement,
the Committee may, in its sole discretion, deem that the terms and conditions
have been met for all or part of such remaining portion. If Shares issued shall
be reacquired by WRI and forfeited as provided above, the employee, or in the
event of his death his personal representative, shall forthwith deliver to the
Secretary of WRI the certificates for the Shares awarded pursuant to the Plan
to the employee, accompanied by such instrument of transfer, if any, as may
reasonably be required by the Secretary of WRI.
If an employee to whom Shares have been awarded dies after satisfaction of
the terms and conditions for the payment of all or a portion of the award but
prior to the actual payment of all or such portion thereof, such payment shall
be made to the employee's estate, personal representative or beneficiary or
beneficiaries at the time and in the same manner that such payment would have
been made to the employee.
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7. PERFORMANCE UNITS AND PERFORMANCE SHARES
a. Awards. Awards may be granted in the form of Performance Units or
Performance Shares. Performance Units are units valued by reference to
designated criteria established by the Committee, other than Shares.
Performance Shares are shares expressed in terms of, or valued by reference to,
a Share. Awards of Performance Units and Performance Shares shall refer to a
commitment by the Company to make a distribution to the employee participant or
to his beneficiary depending on (i) the attainment of the performance
objectives and other conditions established by the Committee and (ii) the base
value of the Performance Unit and Performance Share, respectively, as
established by the Committee.
b. Settlement. Settlement of Performance Units and Performance Shares may, in
the sole discretion of the Committee, be in cash, in Shares or a combination
thereof. The Committee may designate a method of converting Performance Units
into Shares, including but not limited to a method based on the Fair Market
Value of Shares over a series of consecutive trading days. Prior to the
settlement of any Performance Unit or Performance Share in Shares, the
recipient of such award shall pay to WRI an amount of cash equal to, at a
minimum, the par value per Share multiplied by the number of Shares to be
issued.
c. Rights. Participants shall not be entitled to exercise any voting rights
or to receive any interest or dividends with respect to Performance Units or
Performance Shares.
8. LSARS
The Committee shall have the power to grant limited SARs ("LSARs") which
shall be a part of an Award. LSARs shall provide for the automatic cash payment
to the holder of the Award equal to the spread (or other determination of the
value of the Award as fixed by the Committee) upon the occurrence of a Change
in Control (as defined below) on the date fixed by the Committee in the
agreement evidencing such LSAR. LSARs may provide that Committee approval is
not required for the exercise of such LSAR.
9. RECAPITALIZATION
The aggregate number of Shares stated in Section 3.a., the number of Shares
to which each outstanding Award relates, the exercise price in respect of each
Option or SAR and the number of Shares subject to an Award, may be
proportionately adjusted in an equitable manner determined by the Committee, in
its sole discretion and without liability to any person, for any increase or
decrease in the number of issued Shares resulting from the payment of a Share
dividend, a Share split or any transaction which is a "corporation transaction"
(as defined in the Treasury Regulations promulgated under Section 424 (formerly
Section 425) of the Code).
10. MERGER OR CONSOLIDATION
Except as otherwise provided in Section 11 below, after a merger of one or
more entities into the Company in which the Company shall survive, or after a
consolidation of the Company and one or more entities, in which the resulting
entity remains, as an independent, publicly-owned entity, an optionee shall, at
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the same cost, be entitled upon the exercise of an Option of SAR or the
settlement of an Award or the settlement of an Award to receive (subject to any
required action by shareholders and the discretion of the Committee as to the
payment of cash with respect to a SAR) such stock, cash and/or securities of
the surviving or resulting entity as the board of directors of such entity, in
its sole discretion and without liability to any person, shall determine to be
equivalent, as nearly as practicable, to the nearest whole number and class of
Shares or other securities that were then subject to such Award and such shares
of stock or other securities shall, after such merger or consolidation, be
deemed to be Shares for all purposes of the Plan and any agreement.
11. CHANGE IN CONTROL
In the event of a Change in Control (as defined below), then, notwithstanding
any other term of this Plan (except as set forth in any agreement to the
contrary), any and all outstanding Awards not fully vested shall automatically
vest in full and all Options and SARs shall be immediately exercisable. The
date on which such accelerated vesting and immediate exercisability shall occur
(the "Acceleration Date") shall be the date of the occurrence of the Change in
Control.
A "Change in Control" shall be deemed to have occurred if:
(a) any "person," as such term is used in Section 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") (other
than the Company, any trustee or other fiduciary holding securities under
an employee benefit plan of the Company, or any company owned, directly or
indirectly, by the shareholders of the Company in substantially the same
proportions as their ownership of shares of the Company) together with its
"Affiliates" and "Associates," as such term is defined in Rule 12b-2 of the
Exchange Act, makes a tender or exchange offer for or is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of, securities of the Company representing 50% or
more of the combined voting power of the Company's then outstanding
securities;
(b) during any period of two consecutive years (not including any period
prior to the effective date of this Plan), individuals who at the beginning
of such period constitute the Board, and any new trust manager (other than
a trust manager designated by a person who has entered into an agreement
with the Company to effect a transaction described in clause (a), (c) or
(d) of this definition) whose election by the Board or nomination for
election by the Company's shareholders was approved by a vote of at least
two-thirds of the trust managers then still in office who either were trust
managers at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute at
least a majority thereof;
(c) the shareholders of the Company approve a merger or consolidation of
the Company with any other company other than (i) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 80% of the combined voting power of the voting securities
of the Company (or such surviving entity) outstanding
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immediately after such merger or consolidation or (ii) a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no "person" (as hereinabove defined) acquires
more than 25% of the combined voting power of the Company's then
outstanding securities; or
(d) the shareholders of the Company adopt a plan of complete liquidation
of the Company or approve an agreement for the sale, exchange or
disposition by the Company of all or a significant portion of the Company's
assets. For purposes of this clause (d), the term "the sale, exchange or
disposition by the Company of all or a significant portion of the Company's
assets" shall mean a sale or other disposition transaction or series of
related transactions involving assets of the Company or any subsidiary of
the Company (including the stock of any subsidiary of the Company) in which
the value of the assets or stock being sold or otherwise disposed of (as
measured by the purchase price being paid therefore or by such other method
as the Board determines is appropriate in a case where there is no readily
ascertainable purchase price) constitutes more than 50% of the fair market
value of the Company (as hereinafter defined). For purposes of the
preceding sentence, the "fair market value of the Company" shall be the
aggregate market value of the outstanding Shares of the Company (on a fully
diluted basis) plus the aggregate market value of the Company's other
outstanding equity securities. The aggregate market value of the Shares of
the Company shall be determined by multiplying the number of Shares (on a
fully diluted basis) outstanding on the date of the execution and delivery
of a definitive agreement with respect to the transaction or series of
related transactions (the "Transaction Date") by the average closing price
of the Shares of the Company for the ten trading days immediately preceding
the Transaction Date. The aggregate market value of any other equity
securities of the Company shall be determined in a manner similar to that
prescribed in the immediately preceding sentence for determining the
aggregate market value of the Shares of the Company or by such other method
as the Board shall determine is appropriate.
Notwithstanding the foregoing however, (except as stated otherwise in an
Award agreement) a Change in Control shall not be deemed to have occurred if,
prior to the time a Change in Control would otherwise be deemed to have
occurred pursuant to the above provisions, the Board determines otherwise.
12. EMPLOYEE'S AGREEMENT
If, at the time of the exercise of any Option or SAR or the making or vesting
of an Award, in the opinion of counsel for WRI, it is necessary or desirable,
in order to comply with any then applicable laws or regulations relating to the
sale of securities, that the individual exercising the Option or SAR or
receiving the Award shall agree to hold any Shares issued to the individual for
investment and without any present intention to resell or distribute the same
and that the individual will dispose of such Shares only in compliance with
such laws and regulations, the individual will, upon the request of WRI,
execute and deliver to WRI a further agreement to such effect.
13. WITHHOLDING FOR TAXES
No Option or SAR may be exercised or distribution of Shares be made under the
Plan until appropriate arrangements have been made by the individual with the
Company for the payment of any amounts that the
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Company may be required to withhold with respect thereto, which arrangements
may include, if set forth in the agreement relating to such Award, the tender
of owned Shares or the withholding of Shares issuable pursuant to such Award.
14. TERMINATION OF AUTHORITY TO MAKE GRANT
No Awards will be granted pursuant to this Plan after December 31, 2002.
15. AMENDMENT AND TERMINATION
The Board may from time to time and at any time alter, amend, suspend,
discontinue or terminate this Plan and any grants or awards hereunder;
provided, however, that no such action of the Board may, without the approval
of the shareholders of WRI, alter the provisions of the Plan so as to (i)
increase the maximum number of Shares which may be subject to awards and grants
and distributed in the payment of awards and exercises under the Plan (except
as provided in Section 3.b.); (ii) change the class of employees eligible to
receive awards and grants under the Plan; (iii) extend beyond ten years the
maximum terms of options granted under the Plan or extend the term of the Plan;
or (iv) decrease the exercise price applicable to any Option or SAR. The
Committee may, in its discretion, accelerate the vesting of all or part of an
Award. The Committee may, in its discretion, provide for events causing the
acceleration of vesting of all or part of an Award in the agreement relating to
such Award.
16. PREEMPTION BY APPLICABLE LAWS AND REGULATIONS
Anything in the Plan or any agreement entered into pursuant to the Plan to
the contrary notwithstanding, if, at any time specified herein or therein for
the making of any determination or payment of the issue or other distribution
of Shares, any law, regulation or requirement of any governmental authority
having jurisdiction in the premises shall require either WRI or the employee
(or the employee's beneficiary), as the case may be, to take any action in
connection with any such determination, payment, issuance or distribution, the
issue or distribution of such Shares or the making of such determination or
payment, as the case may be, shall be deferred until such action shall have
been taken.
17. CHANGE IN CONTROL LIMITATION
Notwithstanding any other provision in the Plan, to the extent that the
acceleration of exercisability or payment of an Award under this Plan following
a Change in Control, when aggregated with other payments or benefits to the
participant, whether or not payable pursuant to this Plan, would, as determined
by a tax counsel selected by the Company, result in "excess parachute payments"
(as defined in Section 280G of the Code) such parachute payments or benefits
provided to a participant under this Plan shall be reduced to the extent
necessary so that no portion thereof shall be subject to the excise tax imposed
by Section 4999 of the Code, but only if, by reason of such reduction, the
participant's net after tax benefit shall exceed the net after tax benefit if
such reduction were not made. "Net after tax benefit" shall mean the sum of (i)
all payments
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and benefits which a participant receives or is then entitled to receive that
would constitute a "parachute payment" within the meaning of Section 280G of
the Code, less (ii) the amount of federal income taxes payable with respect to
the payments and benefits described in (i) above calculated at the maximum
marginal income tax rate for the year in which such payments and benefits shall
be paid to the participant (based upon the rate for such year as set forth in
the Code at the time of the first payment of the foregoing), less (iii) the
amount of excise taxes imposed with respect to the payments and benefits
described in (i) above by Section 4999 of the Code.
18. AUTOMATIC ADJUSTMENT TO OPTION EXERCISE PRICE
a. Purpose of Exercise Price Adjustment. The purpose of the Plan is to
enhance the financial success of the Company and its shareholders by rewarding
the key employees on whom such financial success depends through incentives
tied to Shares, and by encouraging such employees to acquire and retain such
Shares, thus more closely aligning their interests and rewards with those of
the Company and its shareholders. To ameliorate the potential for outstanding
Options defeating this incentive purpose of the Plan by having optionees
holding Options whose exercise price so greatly exceeds the Market Value Per
Share that the Option has lost its ability to be an incentive to the optionee,
the following provisions of this Section 18 may, at the Committee's discretion,
(determined at the time of grant) govern the terms concerning the exercise
price of any Option granted pursuant to the Plan.
b. Automatic Adjustment. Effective beginning with the first business day in
January of each year, the exercise price of all Options granted pursuant to the
Plan (including any Reload Option) whose (i) date of grant was more than three
years prior to such January business date and (ii) exercise price exceeds the
Market Value Per Share on such January business date by more than 25% shall be
automatically adjusted as follows:
(i) Nonqualified Stock Options. The exercise price to be paid for each
Share receivable upon exercise of each such nonqualified option shall be
equal to the lesser of (A) the Market Value Per Share on such January
business date and (B) the arithmetic average of the Market Value Per Share
on the last day of each of the three months preceding such January business
date.
(ii) Incentive Stock Options. The exercise price to be paid for each
Share upon exercise of each such incentive stock option shall be equal to
the Market Value Per Share on such January business date; provided,
however, that in the case of an employee optionee who, on such date, owns
(within the meaning of Section 424(d) of the Code) more than 10% of the
total combined voting power of all classes of equity securities of the
Company or of any parent or subsidiary of WRI, the exercise price per share
shall be equal to 110% of the Market Value Per Share on such date.
c. Limit on Adjustments. No Option may be adjusted pursuant to this Section
more than once during its term and no automatic adjustment to the exercise
price of an incentive stock option shall be effective if the consequence of
such adjustment would be to cause such option or other incentive stock options
granted under the Plan to such optionee to cease to be an incentive stock
option, unless the optionee consents in writing to such automatic adjustment.
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An automatic adjustment to the exercise price made pursuant to this Section
shall not be treated as the grant of a new option for purposes of this Plan. An
adjustment to the exercise price made pursuant to this Section shall change
only the exercise price of such option; all other terms of such option shall
continue without change.
19. MISCELLANEOUS
a. No Employment Contract. Nothing contained in the Plan shall be construed
as conferring upon any employee the right to continue in the employ of WRI or
any Affiliate.
b. Employment with Affiliates. Employment by WRI for the purpose of this Plan
shall be deemed to include employment by, and to continue during any period in
which an employee is in the employment of, any Affiliate.
c. No Rights as a Shareholder. An employee shall have no rights as a
shareholder with respect to Shares covered by the employee's Award until the
date of the issuance of such Shares to the employee pursuant thereto. No
adjustment will be made for dividends or other distributions or rights for
which the record date is prior to the date of such issuance.
d. No Right to Trust Assets. Nothing contained in the Plan shall be construed
as giving an employee, the employee's estate, personal representative or
beneficiaries or any other person any equity or interest of any kind in any
assets of WRI or an Affiliate or as creating a trust of any kind or a fiduciary
relationship of any kind between WRI or an Affiliate and any such person.
e. No Restriction on Trust Action. Nothing contained in the Plan shall be
construed to prevent WRI or any Affiliate from taking any action that is deemed
by WRI or such Affiliate to be appropriate or in its best interest, whether or
not such action would have an adverse effect on the Plan or any grant made
under the Plan. No employee, beneficiary or other person shall have any claim
against WRI or any Affiliate as a result of any such action.
f. Nonassignability. Neither an employee nor an employee's estate, personal
representative or beneficiary shall have the power or right to sell, exchange,
pledge, transfer, assign or otherwise encumber or dispose of such employee's
estate's, personal representative's or beneficiary's interest arising under the
Plan nor shall such interest be subject to seizure for the payment of an
employee's or beneficiary's debts, judgments, alimony, or separate maintenance
or be transferable by operation of law in the event of an employee's estate's,
personal representative's or beneficiary's bankruptcy or insolvency and to the
extent any such interest arising under the Plan is awarded to a spouse pursuant
to any divorce proceeding, such interest shall be deemed to be terminated and
forfeited notwithstanding any vesting provisions or other terms herein or in
the agreement evidencing such Award.
g. Application of Funds. The proceeds received by WRI from the sale of Shares
pursuant to the Plan will be used for its general business purposes.
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<PAGE>
h. Governing Law; Construction. All rights and obligations under the Plan
shall be governed by, and the Plan shall be construed in accordance with, the
laws of the State of Texas without regard to the principles of conflicts of
laws. Titles and headings to Sections herein are for purposes of reference
only, and shall in no way limit, define or otherwise affect the meaning or
interpretation of any provisions of the Plan.
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<PAGE>
PROXY WEINGARTEN REALTY INVESTORS PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF TRUST MANAGERS
The undersigned hereby appoint(s) STANFORD ALEXANDER, MARTIN DEBROVNER AND
JOSEPH W. ROBERTSON, JR., or any of them, lawful attorneys and proxies of the
undersigned with full power of substitution, for and in the name, place and
stead of the undersigned to attend the Annual Meeting of Shareholders of
Weingarten Realty Investors to be held at The Houstonian, 111 N. Post Oak Lane,
Houston, Texas on Tuesday, May 2, 1996, at 4:00 p.m., Houston time, and any
adjournment(s) thereof, with all powers the undersigned would possess if
personally present and to vote the number of votes the undersigned would be
entitled to vote if personally present.
THE BOARD OF TRUST MANAGERS RECOMMENDS A VOTE "FOR" PROPOSALS NUMBER 1, 2 AND
3.
PROPOSAL 1: The Election of [ ] FOR nominees listed [ ] WITHHOLD AUTHORITY
Trust Managers: below (Except as to vote for all
marked to the contrary) nominees listed
below
Stanford Alexander, Andrew M. Alexander, Martin Debrovner, Melvin A. Dow,
Stephen A. Lasher, Joseph W. Robertson, Jr., Douglas W. Schnitzer, Marc J.
Shapiro, J. T. Trotter
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT NOMINEE'S NAME HERE:
- --------------------------------------------------------------------------------
PROPOSAL 2: Ratification of the appointment of Deloitte & Touche llp as the
independent auditors of the Company.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
- --------------------------------------------------------------------------------
PROPOSAL 3: To amend the 1993 Share Incentive Plan of the Company to increase
the number of shares available from 500,000 to 1,000,000:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(TO BE SIGNED ON THE OTHER SIDE)
In accordance with their discretion, said Attorneys and Proxies are
authorized to vote upon such other matters or proposals not known at the time
of solicitation of this proxy which may properly come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR PROPOSALS 1, 2 AND 3. ANY PRIOR PROXY IS HEREBY REVOKED.
Dated: 1996
--------------------------------,
--------------------------------------------
Signature
--------------------------------------------
(Signature if held jointly)
Please sign exactly as your name appears at
the left. When shares are held by joint
tenants, both should sign. When signing as
attorney, executor, administrator, trustee
or corporation, please sign in full
corporate name by president or other
authorized person. If a partnership, please
sign in partnership name by authorized
person.
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY CARD
PROMPTLY, USING THE ENCLOSED ENVELOPE. THANK YOU.
