Share Option Plan - Brookfield Properties

1.6 Amendment and TerminationThe Board may amend, suspend or terminate the Plan, or any portion thereof, at any time, subjectto those provisions of applicable law (including, without limitation, the applicable rules,regulations and policies of any exchange, if any) that require the approval of shareholders or anygovernmental or regulatory body. The Board may make amendments to the Plan or to any Optionoutstanding thereunder without seeking shareholder approval, except for the following types ofamendments:(i)(ii)increasing the number of Common Shares reserved for issuance under the Plan;reducing the exercise price of an Option, except in connection with a stockdividend or split, recapitalization, merger, consolidation, combination orexchange of shares or other corporate change or a shareholder rights or similarplan pursuant to section 1.4(b), where such reduction does not include thecancellation or termination of an Option prior to its expiry date for the purpose ofreissuing options to the same Participant with a lower exercise price;(iii) extending the term of an Option beyond its original expiry date or beyond 10years from its grant date, except the automatic extension of an Option the expirydate of which would have fallen within a Blackout Period pursuant to Section2.3(f);(iv)(v)(vi)(vii)extending eligibility to participate in the Plan to non-employee directors;permitting Options to be transferred other than by testate or intestate succession;permitting the addition or modification of a cashless exercise feature, payable incash or Common Shares, unless it provides for a full deduction of the number ofunderlying Common Shares from the Plan reserve; orpermitting awards, other than Options, to be made under the Plan.Except as expressly set forth in the Plan, no action of the Board shall alter or impair therights of a Participant under any Option previously granted to the Participant without theconsent of the affected Participant.1.7 Compliance with LegislationThe Board may postpone any exercise of any Option or the issue of any Underlying Sharespursuant to the Plan for such time as the Board in its discretion may deem necessary in order topermit the Corporation to effect or maintain registration of the Plan or the Common Shares issuablepursuant thereto under the securities laws of any applicable jurisdiction, or to determine that suchshares and the Plan are exempt from such registration. The Corporation shall not be obligated byany provision of the Plan or grant thereunder to sell or issue Common Shares in violation of thelaw of any government having jurisdiction therein. In addition, the Corporation shall have noobligation to issue any Common Shares pursuant to the Plan unless such Common Shares shallhave been duly listed, upon official notice of issuance, with a stock exchange on which suchCommon Shares are listed for trading.

2.4 Change in Employment StatusExcept as otherwise determined by the Board in accordance with applicable laws and regulations,the following provisions apply to the exercise and cancellation of Options on or following a changein the employment status of a Participant. For greater certainty, no Option shall be exercisable afterits stated expiry date, except as set out in Section 2.3(f).(a)(b)(c)(d)(e)(f)In the event of termination of the employment of a Participant by the Corporation or anAffiliate other than with cause, each of the Vested Options held by the Participant shallcease to be exercisable 60 days after the Participant’s Termination Date. Each Optionheld by a Participant that is Vested but not exercised by such time shall be cancelled.Each Option held by a Participant that is not Vested by the Termination Date shall becancelled on the Termination Date.In the event of termination of the employment of a Participant by the Corporation or anAffiliate for cause, all Options whether Vested or not Vested by the Termination Dateshall be cancelled on the Termination Date.In the event of resignation by a Participant, all Options whether Vested or not Vested bythe Termination Date shall be cancelled on the Termination Date.In the event of Retirement by a Participant, each of the Vested Options held by theParticipant shall continue to be exercisable until its original Expiry Date. Each Optionheld by a Participant that is Vested but not exercised by such time shall be cancelled.Each Option held by a Participant that is not Vested by the Termination Date shall becancelled on the Termination Date.In the event of a Participant being on a continuous leave of absence other than as a resultof disability or leave authorized by statute, all Options whether Vested or not Vested bythe Termination Date shall be cancelled on the Termination Date.In the event of a Participant being on an authorized continuous leave of absence as aresult of disability or leave authorized by statute, each of the Vested Options held by theParticipant shall cease to be exercisable 60 days after the Participant’s Termination Date.Each Option held by a Participant that is Vested but not exercised by such time shall becancelled. Each Option held by a Participant that is not Vested by the Termination Dateshall be cancelled on the Termination Date.2. In the event of the death of a Participant, the legal representatives of the Participant may exerciseeach of the Vested Options held by the Participant for six months after the Participant’sTermination Date to the extent such Options are by their terms Vested and exercisable by theTermination Date or become so within a period of six months following the Participant’s death.Each Option held by a Participant that is Vested but not exercised by the legal representatives ofthe Participant by such time shall be cancelled.

SECTION 3. APPROVAL3.1 ApprovalThe Plan was approved by the directors of the Corporation on November 7, 1990.3.2 AmendmentThe Plan was amended by the directors of the Corporation on February 9, 1998. Shareholderapproval of the February 9, 1998 amendment was given at the annual and special meeting of theCorporation held on April 29, 1998.The Plan was amended and restated by the directors of the Corporation on February 5, 2004 to(i) eliminate the market growth feature, (ii) to delete directors of the Corporation as eligiblepersons under the Plan except for options granted to non-management directors prior to that date,(iii) to delete references to the pension plan and (iv) subject to approval of the shareholders of theCorporation, to increase the Specified Maximum to 9,000,000.This Plan was amended and restated by the directors of the Corporation on February 7, 2007 toadd a specific amendment provision and provide for the automatic extension of Options that wouldotherwise expire during a Blackout Period, subject to approval of the shareholders of theCorporation, and to make other housekeeping amendments. Shareholder approval was given atthe annual and special meeting of the shareholders of the Corporation held on April 26,2007.This Plan was amended by the directors of the Corporation on February 6, 2008, subject toapproval of the shareholders of the Corporation, to increase the Specified Maximum to39,000,000. Shareholder approval was given at the annual and special meeting of the shareholdersof the Corporation held on April 24, 2008.This Plan was amended by the directors of the Corporation on October 27, 2008 to make the Plancompliant with Section 409A of the U.S. Internal Revenue Code, as amended. Shareholderapproval was not required for this amendment.This Plan was amended by the directors of the Corporation on July 28, 2009 to expand thedefinition of “Termination Date” and extend the ability of a Participant to exercise their optionsafter their Termination Date in certain instances. The Plan was also amended to include officersand employees of an Affiliate in the definition of “Eligible Employee”. Shareholder approval wasnot required for these amendments.

REGULATIONS UNDER SHARE OPTION PLAN1. In these regulations, words defined in the Plan and not otherwise defined herein shall have thesame meaning as set forth in the Plan.(a) “year” with respect to any Option granted under the Plan means the period of 12months commencing on the date of the granting of such Option or on any anniversarythereof.2. No Option shall be granted under the Plan unless recommended by the Human Resources andCompensation Committee of the Board.3. Not less than 100 Common Shares may be acquired at any one time except where the remaindertotals less than 100.4. In the event that the legal representatives of a Participant who has died exercises the Participant’sOption in accordance with the terms of the Plan, the Corporation shall have no obligation to issuethe Common Shares until evidence satisfactory to the Corporation has been provided by such legalrepresentatives that such legal representatives are entitled to acquire the Common Shares under thePlan.5. Common Shares duly acquired under the terms of an Option shall be registered in the name of theParticipant and a share certificate representing the number of such Common Shares shall be issuedin the name of the Participant, his or her legal representatives or as he, she or they may direct.