Exhibit 99.1
HIGHWOODS PROPERTIES, INC.
YEAR 2000 EMPLOYEE STOCK PURCHASE PLAN
Highwoods Properties, Inc. (the "Company") hereby establishes a Year
2000 Employee Stock Purchase Plan (the "Plan") granting Eligible Employees of
the Company and its Subsidiaries the opportunity to purchase Common Stock of the
Company.
NOW, THEREFORE, the Company hereby establishes the Plan, the terms of
which are as follows:
SECTION 1. Purpose.
The purpose of this Plan is to give Eligible Employees of the Company
and its Subsidiaries, an opportunity to acquire shares of the Company's Common
Stock in order to increase their proprietary interest in the Company's success,
to encourage them to remain in the employ of the Company, and to continue to
promote the Company's best interests and enhance its long-term performance.
SECTION 2. Definitions.
Wherever used herein, the following words and phrases shall have the
meanings stated below unless a different meaning is plainly required by the
context:
(a) "ADMINISTRATOR" means First Union National Bank or such other
third-party administrator appointed by the Committee to maintain the records of
the Plan and conduct such other duties as may be further described herein.
(b) "AVAILABLE SHARES" means the aggregate number of shares of Common
Stock which may be purchased by Eligible Employees under the Plan, as described
in Section 5.
(c) "BOARD" means the Board of Directors of the Company.
(d) "CODE" means the Internal Revenue Code of 1986, as amended.
(e) "COMMITTEE" means the Compensation Committee of the Board composed of
not less than three members of the Board to which the Board may delegate its
powers with respect to administration of the Plan pursuant to Section 6 hereof.
(f) "COMMON STOCK" means shares of the common stock of the Company, $.01
par value. Common stock hereunder includes both treasury stock and stock of
original issue.
(g) "COMPANY" means Highwoods Properties, Inc., a Maryland corporation.
(h) "COMPENSATION" means an Eligible Employee's regular base pay at the
rate in effect on the applicable Offering Date and any annual bonus, overtime
payment or sales commission, excluding any pre-tax contribution to any medical
or retirement plans qualified under Section 125 or 401(k) of the Code.
(i)"ELIGIBLE EMPLOYEE" means any individual who on any Offering Date is
employed by the Company or a Subsidiary on a regular full-time basis. A person
shall be considered employed on a regular full-time basis if he or she is
customarily employed by the Company or a Subsidiary at least 20 hours per week
and is customarily employed for more than five months per calendar year.
"Eligible Employee" shall not include any person who would own, immediately
after the Option was granted, stock possessing five percent or more of the total
combined voting power or value of any class of stock of the Company, or any
Subsidiary. For purposes of this subsection 2(i), stock ownership of an
individual shall be determined under Section 424(d) of the Code, and stock that
the individual may purchase under outstanding Options shall be treated as stock
owned by the individual.
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(j) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
(k) "EXERCISE DATE" means June 30, 2000, and any subsequent December 31,
March 31, June 30 and September 30 thereafter during the term of the Plan.
(l) "FAIR MARKET VALUE" of Common Stock as of any date means the average
of the closing or last prices of the Common Stock on the New York Stock Exchange
or other comparable reporting system for the five consecutive trading days
immediately preceding such applicable date.
(m) "OFFERING DATE" means April 1, 2000, and any subsequent October 1,
January 1, April 1 and July 1 thereafter during the term of the Plan.
(n) "OFFERING PERIOD" means the period commencing on an Offering Date
hereunder and ending on the next following Exercise Date.
(o) "OPTION" means an option granted hereunder which will entitle an
Eligible Employee to purchase shares of Common Stock.
(p) "OPTION PRICE" means the lesser of 85% of the Fair Market Value per
share of Common Stock as of the applicable Offering Date or 85% of the Fair
Market Value per share of Common Stock on the applicable Exercise Date.
(q) "PLAN" means the Highwoods Properties, Inc. Year 2000 Employee Stock
Purchase Plan as set forth herein and as subsequently amended.
(r) "PURCHASE ACCOUNT" means the book entry account maintained by the
Company or Administrator to record the funds withheld from each Eligible
Employee's payroll for the purchase of Common Stock, to record the shares of
Common Stock credited to each Eligible Employee under the Plan and to record
dividends credited to an Eligible Employee for use in the Plan pursuant to
Section 12.
(s) "SUBSIDIARY" or "SUBSIDIARIES" means the corporation or corporations
meeting the requirements of Section 424(f) of the Code.
SECTION 3. BASIS OF PARTICIPATION AND GRANTING OF OPTIONS.
(a) Each Eligible Employee on any Offering Date, commencing with the
Offering Date which occurs on or after April 1, 2000 and, subject to earlier
termination of the Plan pursuant to subsection 14(c) hereof, ending with the
last Offering Date on which shares of Common Stock are available for grant
within the limitation set forth in Section 5, is granted an Option hereunder
which will entitle him or her to purchase, at the Option Price per share
applicable to such Offering Date, the largest number of shares of Common Stock,
including any fraction of a share (computed to at least three decimal places),
that may be purchased with the cash balance of the Eligible Employee's Purchase
Account.
(b) If the number of shares of Common Stock for which Options are granted
pursuant to subsection 3(a) exceeds the applicable number set forth in Section
5, then the Options granted under the applicable paragraph to all Eligible
Employees shall, in a nondiscriminatory manner which shall be consistent with
subsection 14(c), be reduced in proportion to their respective Compensation, and
the balance of the Purchase Account of each Eligible Employee shall be returned
without interest to each Eligible Employee as soon as practicable.
(c) Payment for Common Stock purchased under the Option shall be made
only by payroll deductions over a designated Offering Period and, in accordance
with Section 12, the reinvestment of dividends paid in a designated Offering
Period on shares credited to the Eligible Employee's Purchase Account.
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(d) Each Option under the Plan shall be granted on the condition that (i)
a registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the Common Stock subject to such Option has
become effective and a copy of the Prospectus has been delivered to the Eligible
Employee and (ii) the shares of Common Stock issuable hereunder have been
approved for listing by the New York Stock Exchange.
SECTION 4. PURCHASE ACCOUNT.
Each Eligible Employee shall notify the Company, on such forms as shall
be provided by the Company, prior to March 31, 2000 or, if later, at least 21
days before the applicable Offering Date, of the percentage (in whole numbers)
of Compensation which the Eligible Employee wishes to have withheld ratably from
the Eligible Employee's Compensation during the Offering Period, which
percentage may not be less than 1%, or more than 25%.
Each Eligible Employee shall authorize the Company and its Subsidiaries
to withhold from the Eligible Employee's after-tax compensation, beginning as
soon as practicable following the making of the election described in this
Section 4 and continuing throughout the duration of the Offering Period unless
terminated sooner under Section 7. All withheld amounts may be used by the
Company for general corporate purposes. The Company or Administrator shall
maintain a record of each Eligible Employee's funds in the Eligible Employee's
Purchase Account. Such funds so accumulated within said Purchase Account may be
returned to an Eligible Employee or beneficiary without interest or applied
toward the purchase of Common Stock only pursuant to the provisions contained in
this Plan.
SECTION 5. MAXIMUM LIMITATIONS.
The aggregate number of shares of Common Stock available for grant as
Options pursuant to this Plan shall not exceed 500,000, subject to adjustment
pursuant to Section 10 hereof. Shares of Common Stock granted pursuant to the
Plan may be either authorized but unissued shares or shares now or hereafter
held in the treasury of the Company. In the event that any Option granted
pursuant to subsection 3(a) expires or is terminated, surrendered or canceled
without being exercised, in whole or in part, for any reason, the number of
shares of Common Stock theretofore subject to such Option shall again be
available for grant as an Option pursuant to subsection 3(a) and shall not
reduce the aggregate number of shares of Common Stock available for grant as
such Options as set forth in the first sentence of this Section.
SECTION 6. ADMINISTRATION.
The Plan shall be administered by the Board, which, to the extent it
shall determine, may delegate its powers with respect to the administration of
the Plan (except its powers under subsection 14(c)) to the Committee. If the
Board chooses to appoint a Committee, references hereinafter to the Board
(except in subsection 14(c)) shall be deemed to refer to the Committee. Subject
to the express provisions of the Plan, the Board may interpret the Plan,
prescribe, amend and rescind rules and regulations relating to it, correct any
defect or omission or reconcile any inconsistency in the Plan, determine the
terms and provisions of the Options granted hereunder, determine and change the
Offering Periods, Offering Dates and Exercise Dates (except as otherwise limited
herein) and make all other determinations necessary or advisable for the
administration of the Plan. The determinations of the Board on all matters
regarding the Plan shall be conclusive. A member of the Board shall only be
liable for any action taken or determination made in bad faith.
SECTION 7. TERMS OF OPTIONS.
(a) Each Option shall, unless sooner expired pursuant to subsection 7(b)
or (c), be exercised on the Exercise Date for the applicable Offering Period.
Each Option not exercised during an Offering Period shall expire on the Exercise
Date for the applicable Offering Period.
(b) An Eligible Employee may at any time at least 21 days before an
Exercise Date (or such other date as may be selected by the Committee) terminate
the Option in its entirety by written notice of such
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termination delivered in the manner set forth in subsection 14(i). Such
termination shall become effective upon receipt of such notice by the Company.
As soon as practical following such notice, all funds then in the Eligible
Employee's Purchase Account shall be returned to the Eligible Employee without
interest. Subsequent cash dividends paid on shares held in the Eligible
Employee's Purchase Account will be paid to the Eligible Employee and not
retained in such Purchase Account. Such Eligible Employee may again elect to
participate in payroll deductions under the Plan on the next Offering Date
pursuant to Sections 3 and 4, when, in accordance with Section 12, cash
dividends paid on shares held in the Eligible Employee's Purchase Account will
again be credited to such Purchase Account for use pursuant to Section 3(a).
(c) An Option shall expire on the first to occur of the Exercise Date for
the applicable Offering Period and the date that the employment of the Eligible
Employee with the Company and its Subsidiaries terminates (as determined by the
Board) for any reason, including death or permanent disability (as determined by
the Company's long term disability plan). In the event that the Option expires
because of termination of employment, all funds and shares then on deposit in
the Eligible Employee's Purchase Account shall be returned without interest to
the Eligible Employee (or his or her estate or the beneficiary designated
pursuant to Section 9(b)) and the Eligible Employee's Purchase Account closed.
SECTION 8. MANNER OF EXERCISE OF OPTIONS AND PAYMENT FOR COMMON STOCK.
(a) Except as provided in subsection 7(b) or (c), each Eligible
Employee's Option shall be exercised automatically on the Exercise Date of each
Offering Period, and the maximum number of shares of Common Stock, including
fractional shares, will be purchased by the Administrator for each Eligible
Employee with the entire proceeds of each Eligible Employee's Purchase Account.
The Common Stock purchased under this Section 8 may be either treasury stock or
stock of original issue, in the discretion and at the direction of the Company.
(b) Upon the written request of an Eligible Employee following any
Offering Period, the Administrator shall deliver (or cause to be delivered) to
such Eligible Employee: (i) a certificate for up to all of the whole shares
purchased under subsection 8(a) and then retained in the Eligible Employee's
Purchase Account (as adjusted pursuant to Section 10), and (ii) the cash value
of any fraction of a share (based on the Fair Market Value of the common Stock
as of the date such request is delivered) remaining in such Purchase Account
requested to be withdrawn. Shares to be delivered to an Eligible Employee under
the Plan will be registered in the name of the Eligible Employee or, at the
election of the Eligible Employee, in the name of the Eligible Employee and his
or her spouse as joint tenants with rights of survivorship. Any remaining shares
in such Eligible Employee's Purchase Account will continue to be credited to
such Eligible Employee's Purchase Account and cash dividends paid thereon will
be credited to such Purchase Account without interest in accordance with Section
12.
(c) Subsection 8(b) notwithstanding, an Eligible Employee may not
withdraw any share purchased under this Plan until the date that is six months
from the Exercise Date on which such share was purchased, except pursuant to
subsection 7(c) upon the Eligible Employee's death, permanent disability or
other termination of employment.
(d) Subject to Section 12, an Eligible Employee may not make additional
cash payments into such Eligible Employee's Purchase Account.
SECTION 9. PROHIBITION OF TRANSFER AND DESIGNATION OF BENEFICIARY.
(a) No Option may be transferred, assigned, pledged, or hypothecated
(whether by operation of law or otherwise), and no Option shall be subject to
execution, attachment or similar process. Any attempted assignment, transfer,
pledge, hypothecation or other disposition of an Option, or levy of attachment
or similar process upon the Option not specifically permitted herein shall be
null and void and without effect. An Option may be exercised only by the
Eligible Employee during his or her lifetime.
(b) Each Eligible Employee may file a written designation of beneficiary
who is to receive any stock or cash held in the Eligible Employee's Purchase
Account in the event that such Eligible Employee dies.
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SECTION 10. ADJUSTMENT PROVISIONS.
The aggregate number of shares of Common Stock with respect to which
Options may be granted, the aggregate number of shares of Common Stock subject
to each outstanding Option, the Option Price per share of each Option and the
number of shares in each Purchase Account may all be appropriately adjusted as
the Board may determine for any increase or decrease in the number of shares of
issued Common Stock resulting from a subdivision or consolidation of shares,
whether through reorganization, recapitalization, stock split-up, stock
distribution or combination of shares, or the payment of a share dividend or
other increase or decrease in the number of such shares outstanding effected
without receipt of consideration by the Company. Adjustments under this Section
10 shall be made according to the sole discretion of the Board, and its decision
shall be binding and conclusive.
SECTION 11. DISSOLUTION, MERGER AND CONSOLIDATION.
In the event of (i) the adoption of a plan of merger, consolidation,
share exchange or similar transaction of the Company with any other corporation
as a result of which the holders of the Common Stock of the Company in the
aggregate would receive less than 50% of the voting capital stock of the
surviving or resulting corporation; (ii) the approval by the Board of an
agreement providing for the sale or transfer (other than as security for
obligations of the Company) by the Company of a majority of the stock of a
significant subsidiary of the Company or substantially all of the assets of the
Company or of a significant subsidiary of the Company; (iii) the acquisition of
more than 20% of the Company's voting capital stock by any person within the
meaning of Section 13(d)(3) of the Exchange Act, other than a person, or group
including a person, who beneficially owned, as of the most recent Offering Date,
more than 5% of the Company's securities, in the absence of a prior expression
of approval of the Board; (iv) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board cease for
any reason to constitute at least a majority thereof unless the election, or the
nomination for election by the Company's stockholders, of each new director was
approved by the vote of at least two-thirds of the directors then still in
office who were directors at the beginning of the period; or (v) any other
change in control of the Company of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A under the
Exchange Act, then any Option granted hereunder during the then-current Option
Period shall remain exercisable until the Exercise Date of the then-current
Option Period, subject to all of the terms hereof not inconsistent with this
Section 11.
Anything contained herein to the contrary notwithstanding, upon the
dissolution or liquidation of the Company or the consummation of a merger or
consolidation in which the stockholders of the Company receive less than 50% of
the voting capital stock of the surviving or resulting corporation, each Option
granted under the Plan shall terminate, but the Eligible Employee shall have the
right, following the adoption of a plan of dissolution or liquidation or a plan
of merger or consolidation and in any event prior to such dissolution,
liquidation, merger or consolidation, to exercise his Option to purchase Common
Stock on the Exercise Date of the then-current Offering Period, subject to all
of the other terms hereof not inconsistent with this Section 11.
The grant of an Option pursuant to this Plan shall not affect in any
way the right or power of the Company to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure, or to merge or
consolidate, or to dissolve, liquidate or sell, or transfer all or any part of
the business or assets.
SECTION 12. DIVIDENDS AND INTEREST.
(a) During any period in which an Eligible Employee is participating
in the Plan through payroll deductions, but only during such period, cash
dividends paid on shares (including any fraction of a share) held in an Eligible
Employee's Purchase Account will be credited to such Eligible Employee's
Purchase Account and used in addition to such payroll deductions to purchase
shares of Common Stock on the Exercise Date. Adjustments made pursuant to
Section 10 will be credited to the Purchase Account of the Eligible Employee.
Dividends paid in property other than cash or shares of Common Stock will be
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distributed to an Eligible Employee as soon as practicable. No dividends will be
earned on a share in an Eligible Employee's Purchase Account until the dividend
payment for the first dividend record date that follows the purchase date of
such share.
(b) No interest will accrue on or be payable with respect to cash
dividends held in an Eligible Employee's Purchase Account.
SECTION 13. LIMITATION ON OPTIONS.
Notwithstanding any other provisions of the Plan:
(a) All Eligible Employees shall have the same rights and privileges
under the Plan, except that the amount of Common Stock which may be purchased
under Options granted pursuant to Section 3, shall bear a uniform relationship
to the Compensation of Eligible Employees. All rules and determinations of the
Board in the administration of the Plan shall be uniformly and consistently
applied to all persons in similar circumstances.
(b) The term of said Plan shall be for a period of 10 years commencing on
April 1, 2000 and ending on March 31, 2010 unless terminated earlier by the
exhaustion of the Available Shares pursuant to Section 3 or 5 or as provided in
subsection 14(c).
(c) As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent that, at the time of any such
exercise, the shares are being purchased only for an investment and without any
present intention to sell or distribute such shares if, in the opinion of
counsel for the Company, such representation is required by any applicable
provisions of law.
SECTION 14. MISCELLANEOUS.
(a) LEGAL AND OTHER REQUIREMENTS. The obligations of the Company to sell
and deliver Common Stock under the Plan shall be subject to all applicable
foreign or domestic laws, regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a registration statement under the
Securities Act and the requirements of any stock exchange upon which the shares
of Common Stock may be listed if deemed necessary or appropriate by the Company.
Certificates for shares of Common Stock issued hereunder may include a
restricted legend as the Board shall deem appropriate.
(b) NO OBLIGATION TO EXERCISE OPTIONS. The granting of an Option shall
impose no obligation upon an Eligible Employee to exercise such Option unless
such Eligible Employee affirmatively elects to purchase Common Stock through
payroll withholding as described in Section 4.
(c) TERMINATION AND AMENDMENT OF PLAN. The Board may from time to time
alter, amend or suspend the Plan or any Option granted hereunder or may at any
time terminate the Plan, except that it may not materially and adversely affect
any outstanding Option without the consent of the holder thereof.
(d) APPLICATION OF FUNDS. The proceeds received by the Company from the
sale of Common Stock pursuant to Options will be used for general corporate
purposes.
(e) WITHHOLDING TAXES. Upon the exercise of any Option under the Plan,
the Company shall have the right to require the Eligible Employee to remit to
the Company an amount sufficient to satisfy all federal, state and local
withholding tax requirements prior to the delivery of any certificate or
certificates for shares of Common Stock.
(f) RIGHT TO TERMINATE EMPLOYMENT. Nothing in the Plan or any agreement
entered into pursuant to the Plan shall confer upon any Eligible Employee the
right to continue in the employment of the Company or any Subsidiary or affect
any right which the Company or any Subsidiary may have to terminate the
employment of such Eligible Employee.
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(g) RIGHTS AS A STOCKHOLDER. No Eligible Employee shall have any right as
a stockholder with respect to shares covered by an Option unless and until such
Option has been exercised.
(h) LEAVES OF ABSENCE AND DISABILITY. The Board shall be entitled to make
such rules, regulations and determinations as it deems appropriate under the
Plan in respect of any leave of absence taken by or disability of any Eligible
Employee. Without limiting the generality of the foregoing, the Board shall be
entitled to determine (i) whether or not any such leave of absence shall
constitute a termination of employment within the meaning of the Plan, and (ii)
the impact, if any, of any such leave of absence on Options under the Plan
theretofore granted to any Eligible Employee who takes such leave of absence.
(i) NOTICES. Every direction, revocation or notice authorized or required
by the Plan shall be deemed delivered on the date it is personally delivered, or
the date that is three business days after it is sent by registered or certified
mail, postage prepaid, to the Company's Director of Human Resources, at the
Company's principal office at 3100 Smoketree Court, Suite 600, Raleigh, N.C.
27604; and shall be deemed delivered to an Eligible Employee (i) on the date it
is personally delivered to him or her or (ii) three business days after it is
sent by registered or certified mail, postage prepaid, addressed to him or her
at the last address shown for him or her on the records of the Company or of any
Subsidiary.
(j) APPLICABLE LAW. All questions pertaining to the validity,
construction and administration of the Plan and Options granted hereunder shall
be determined in conformity with the laws of the state of Maryland.
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