Attached files
| file | filename |
|---|---|
| 8-K - FBR & Co. | efc10-147_8k.htm |
| EX-10.1 - FBR & Co. | efc10-147_ex101.htm |
| EX-10.2 - FBR & Co. | efc10-147_ex102.htm |
| EX-10.3 - FBR & Co. | efc10-147_ex103.htm |
Exhibit
10.4
FBR
CAPITAL MARKETS CORPORATION
PARTNER
LEVERAGED STOCK PURCHASE PROGRAM
FBR
Capital Markets Corporation, a corporation existing under the laws of the
Commonwealth of Virginia (the “Company”), hereby establishes and adopts the
following 2010 Partner Leveraged Stock Purchase Program (the “Program”),
effective as of December 17, 2009 and as amended time to time.
1.
PURPOSE OF THE PROGRAM
1.1. Purpose. The
Program is designed to encourage employees who are members of the Partnership
Group of the Company to increase their ownership of Shares and to more closely
align their interests with the interests of the Company’s non-employee
shareholders.
2.
DEFINITIONS
2.1. “Affiliate” shall mean (i) any
person or entity that directly, or through one or more intermediaries, controls,
or is controlled by, or is under common control with, the Company (including any
Subsidiary) or (ii) any entity in which the Company has a significant equity
interest, as determined by the Committee.
2.2. “Board” shall mean the board
of directors of the Company.
2.3. “Cause” shall mean
(i) conviction of a Participating Partner for any crime (or upon entering a
plea of guilty or nolo contendre to a charge of any crime) constituting a
felony, (ii) dishonesty in the course of fulfilling a Participating
Partner’s employment duties, or (iii) willful and deliberate failure on the
part of a Participating Partner to perform his employment duties in any material
respect. Notwithstanding the foregoing, if a Participating Partner is
a party to an employment agreement with the Company or any Subsidiary or
Affiliate that contains a definition of “Cause,” such definition shall apply to
the Participating Partner for purposes of the Program.
2.4. “Committee” shall mean the
Compensation Committee of the Board, or, if such committee of the Board has not
been appointed, the Board.
2.5. “Disability” means permanent
and total disability as determined by the Committee, in its sole
discretion.
2.6. “Eligible Executive Officer”
shall mean the Chief Financial Officer of the Company and the General Counsel of
the Company.
2.7. “Employee” shall mean any
employee of the Company, a Subsidiary or an Affiliate.
2.8. “Employment Related Forfeiture
Event” shall occur if (a) a Participating Partner voluntarily terminates
his or her employment with the Company, or (b) the Participating Partner’s
employment is involuntarily terminated for Cause by the Company, provided that
an Employment Related Forfeiture Event will be deemed not to have occurred in
the event of a Participating
Partner’s
termination (i) involuntarily other than for Cause by the Company, (ii) by
reason of the Participating Partner’s death or Disability, or (iii) voluntarily
by the Participating Partner upon Retirement.
2.9. “Option” shall mean a
non-qualified stock option granted under the 2006 Plan by the Company as of a
Purchase Date to a Participating Partner.
2.10. “Option Reduction” shall
occur if, upon the completion of a Sale, the aggregate number of Shares deemed
to be held by a Participating Partner for purposes of the Partner Ownership
Guidelines is less than the Participating Partner’s Share Minimum.
2.11. “Participating Partner” shall
mean an eligible Employee who is selected by the Committee to receive a Right
under the Program.
2.12. “Partner Ownership Guidelines”
shall mean guidelines established by the Board specifying stock ownership levels
and Share Minimums for Participating Partners.
2.13. “Pricing Date” shall mean the
trading date immediately preceding a particular Purchase Date.
2.14. “Program Loan” shall mean a
full-recourse secured loan made by the Company to a Participating Partner (other
than a Participating Partner who is an Eligible Executive Officer) in connection
with a purchase of Shares by such Participating Partner under the
Program.
2.15. “Purchase Date” shall mean a
date within a Purchase Period selected by the Committee on which Participating
Partners may purchase Shares under the Program.
2.16. “Purchase Period” shall mean
one of four one-month Purchase Periods established by the Committee during which
Participating Partners may elect to exercise Rights and purchase Shares under
the Program.
2.17. “Purchase Price” shall equal
the greater of the closing sale price or the consolidated closing bid price of
one Share on The NASDAQ Global Select Market on a Pricing Date.
2.18. “Reduction Amount” shall
equal, in connection with a particular Option Reduction, the original principal
balance of the relevant Note multiplied by the percentage by which such Option
Reduction reduced the number of Shares originally subject to the
Option.
2.19. “Retirement” shall mean
retirement from employment with the Company, a Subsidiary or an Affiliate of the
Company as determined by the Committee, in its sole discretion.
2.20. “Right” shall mean any right
granted to a Participating Partner under the Program allowing such Participating
Partner to purchase Shares on one or more Purchase Dates designated by the
Committee at the Purchase Price for each such Purchase Date.
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2.21. “Sale” shall mean a
Participating Partner sells, assigns, transfers or otherwise disposes of any
Shares owned by the Participating Partner before the expiration of the
Participating Partner’s rights under an Option, provided that (a) an actual or
deemed disposition of Shares in connection with the net or cashless exercise of
options to purchase Shares, or the net or cashless vesting of restricted Shares,
shall not constitute a Sale, but only to the extent necessary to pay the
purchase price of such Shares and/or to satisfy any tax withholding obligation
in connection with such exercise or vesting, and (b) a sale, transfer,
assignment or other disposition to a person or entity whose stockholdings are
consolidated with the Participating Partner’s stockholdings for purposes of the
Partner Ownership Guidelines shall not constitute a Sale.
2.22. “Share Minimum” shall mean
the minimum number of Shares established for a Participating Partner under the
Partner Ownership Guidelines.
2.23 “Shares” shall mean the shares
of common stock of the Company, par value $0.001 per share.
2.24. “Stock Option Agreement” shall
mean a written agreement, contract or other instrument or document evidencing
any Option granted by the Committee to a Participating Partner under the 2006
Plan in connection with a purchase of Shares by such Participating Partner under
the Program.
2.25. “Stock Purchase Agreement”
shall mean a written agreement, contract or other instrument or document
evidencing any Right granted by the Committee hereunder.
2.26. “Subsidiary” shall mean any
corporation (other than the Company) in an unbroken chain of corporations
beginning with the Company if, at the time of the granting of the Right, each of
the corporations other than the last corporation in the unbroken chain owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in the chain.
2.27. “2006 Plan” shall mean the
Company’s 2006 Long-Term Incentive Plan, as in effect from time to
time.
In
addition, certain other terms used in the Program have definitions provided to
them in the first place in which they are used herein.
3. SHARES
SUBJECT TO THE PROGRAM
3.1. Number of
Shares. Subject to adjustment as provided in Section 8.2, a
total of 1,250,000 Shares shall be authorized for purchase under the
Program.
3.2. Character of
Shares. Any Shares issued hereunder may consist, in whole or
in part, of authorized and unissued Shares, treasury Shares or Shares purchased
in the open market or otherwise.
4. ELIGIBILITY
AND ADMINISTRATION
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4.1. Eligibility. Any
Employee who is designated as a member of the Partnership Group of the Company
(including any Eligible Executive Officer, but excluding any other executive
officer of the Company) shall be eligible to be selected as a Participating
Partner. Notwithstanding the foregoing, a Participating Partner who
is an Eligible Executive Officer shall not be eligible to receive a Program
Loan.
4.2. Administration.
(a) The
Program shall be administered by the Committee. The Board may remove
from, add members to, or fill vacancies on, the Committee.
(b) The
Committee shall have full power and authority, subject to the provisions of the
Program and subject to such orders or resolutions not inconsistent with the
provisions of the Program as may from time to time be adopted by the Board,
to: (i) select eligible Employees to become Participating Partners;
(ii) establish Purchase Periods and select Purchase Dates; (iii) determine
whether a Participating Partner should be granted Rights to purchase 25,000
Shares or 50,000 Shares, or such other amount as the Committee shall determine
in accordance with Section 5; (iv) determine the terms and conditions, not
inconsistent with the provisions of the Program, of any Right granted hereunder;
(v) determine the terms and conditions, not inconsistent with the provisions of
the Program, of any Program Loan made hereunder; (vi) determine whether, to what
extent and under what circumstances, not inconsistent with the provisions of the
Program, any Right or any Program Loan shall be suspended, canceled or
terminated; (vii) interpret and administer the Program and any instrument or
agreement entered into under or in connection with the Program, including any
Stock Purchase Agreement; (viii) correct any defect, supply any omission or
reconcile any inconsistency in the Program or any Right in the manner and to the
extent that the Committee shall deem desirable to carry it into effect; (ix)
establish such rules and regulations and appoint such agents as it shall deem
appropriate for the proper administration of the Program; and (x) make any other
determination and take any other action that the Committee deems necessary or
desirable for administration of the Program.
(c) Decisions
of the Committee shall be final, conclusive and binding on all persons or
entities, including the Company, any Participating Partner, any shareholder and
any Employee or any Affiliate. A majority of the members of the
Committee may determine its actions and fix the time and place of its
meetings.
(d) The
Committee may delegate to a committee of one or more directors of the Company
or, to the extent permitted by law, to one or more officers or a committee of
officers the right to grant Rights to eligible Employees and to suspend, cancel
or terminate and Right or Program Loan.
5. STOCK
PURCHASE RIGHTS
5.1. Grant of
Rights. The Committee shall grant Participating Partners
Rights to purchase Shares during one or more of four Purchase Periods designated
by the Committee. Each Participating Partner will initially be
granted Rights to purchase either 25,000 Shares or 50,000 Shares, as determined
by the Committee. If, as of a date in the final Purchase Period to be
specified by the Committee, the Participating Partners have not elected to
exercise Rights to
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purchase
all of the Shares available under the Program, the Committee may grant Rights to
purchase the remaining Shares on a pro rata basis to the Participating Partners
who have purchased or elected to purchase the maximum number of Shares otherwise
allowed to be purchased by such Participating Partners, until all Shares
available under the Program have been purchased.
5.2. Exercise of
Rights. With respect to each Purchase Period, a Participating
Partner may elect to purchase Shares on the Purchase Date for such Purchase
Period at the Purchase Price for such Purchase Date. A Participating
Partner may elect to exercise some or all of his or her Rights during a Purchase
Period. If a Participating Partner does not elect to exercise all of
his or her Rights on a particular Purchase Date, then subject to last sentence
of Section 5.1, the Participating Partner may elect to exercise such Rights on a
subsequent Purchase Date (if any). A Participant who wishes to
purchase Shares on a Purchase Date must make a binding election to purchase such
Shares on or before the applicable Pricing Date in accordance with such
procedures, and subject to such terms and conditions, not inconsistent with the
provisions of the Program, as the Committee shall deem desirable.
5.3. Employment Related
Forfeiture. Unvested Rights held by a Participating Partner
will be forfeited upon the occurrence of either of the following events (each,
an “Employment Related Forfeiture Event”): (1) the Participating
Partner voluntarily terminates his or her employment with the Company, or (2)
the Participating Partner’s employment is involuntarily terminated for Cause by
the Company. Rights will not be forfeited in the event of a
Participating Partner’s termination (i) involuntarily other than for Cause by
the Company, (ii) by reason of the Participating Partner’s death or Disability,
or (iii) voluntarily by the Participating Partner upon retirement. In
the event of death or Disability, all Rights held by a Participating Partner
will immediately vest and become exercisable.
5.4. Limitation of
Rights. Any Right shall be subject to the terms and conditions
of this Section 5 and to such additional terms and conditions, not inconsistent
with the provisions of the Program, as the Committee shall deem
desirable.
5.5. Right
Agreements. All Rights granted pursuant to this Section 5
shall be evidenced by a written Stock Purchase Agreement in such form and
containing such terms and conditions as the Committee shall determine which are
not inconsistent with the provisions of the Program. The granting of
a Right to a Participating Partner shall impose no obligation on the
Participating Partner to elect to exercise such Right and purchase Shares under
the Program. A Participating Partner who is granted a Right pursuant
to this Section 5 may hold more than one Right granted pursuant to the Program
at the same time.
6. PROGRAM
LOANS
6.1. Offer to Provide
Leverage. The Company shall offer to make a Program Loan to
each Participating Partner (other than a Participating Partner who is an
Eligible Executive Officer) for up to 50% of the aggregate Purchase Price of the
Shares purchased on a particular Purchase Date by such Participating Partner
under the Program. Each Participating Partner who receives a Program
Loan will be required to execute a full-recourse secured promissory note in
favor of the Company and to enter into a pledge agreement with the Company under
which two Shares for each
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Share
purchased with the Program Loan will be pledged to the Company as security for
the repayment of such Program Loan.
6.2. Maturity Date;
Acceleration. A Program Loan will mature and become due and
payable three years after the Purchase Date to which the Program Loan relates
or, if earlier, on the date on which an Employment Related Forfeiture Event
occurs (the “Maturity Date”). A Program Loan will bear interest at a
rate equal to the greater of 4% or the Federal funds rate plus 0.55%, determined and
compounded quarterly. Any unpaid principal and any accrued but unpaid
interest will be payable on the Maturity Date of a Program Loan. If a
Participating Partner incurs an Option Reduction as a result of a Sale of Shares
purchased with the proceeds of a Program Loan, a portion of the unpaid principal
balance of such Program Loan (together with any accrued and unpaid interest on
such portion of the principal balance) shall immediately mature and become due
and payable. The portion of the principal balance that shall become
due and payable shall equal the lesser of the entire unpaid principal balance on
the date of the Option Reduction and the Reduction Amount relating to such
Option Reduction. To the extent that a Participating Partner receives
more than one Program Loan, the earliest advanced Program Loan will be the first
Program Loan to be repaid.
6.3. Limitations. Any
Program Loan shall be subject to the terms and conditions of this Section 6 and
to such additional terms and conditions, not inconsistent with the provisions of
the Program, as the Committee shall deem desirable. In addition, a
Program Loan may be subject to any additional obligations required by United
States Treasury Regulations.
7. STOCK
OPTION GRANTS UNDER THE 2006 PLAN
7.1. Grant of
Options. In connection with the Program, the Company will
agree to grant an Option under the 2006 Plan to each Participating Partner as of
each Purchase Date. Such Option (a) will vest and become exercisable
on the third anniversary of such Purchase Date, (b) will have an exercise price
per Share equal to the Purchase Price per Share on such Purchase Date, (c) will
give a Participating Partner who is not an Eligible Executive Officer the right
to purchase two additional Shares for each Share purchased by the Participating
Partner under the Program on such Purchase Date, and (d) will give a
Participating Partner who is an Eligible Executive Officer the right to purchase
three additional Shares for each Share purchased by the Participating Partner
under the Program on such Purchase Date. Each such Option will be
subject to such additional terms and conditions, not inconsistent with the
provisions of the 2006 Plan, as the Committee shall deem
appropriate.
7.2. Sale Related Option
Reductions. If a Sale occurs which triggers an Option
Reduction, such Option Reduction shall result in an immediate reduction in the
number of Shares purchasable under an Option, whether vested or not vested,
previously granted to the Participating Partner who made such
Sale. The amount of the Option Reduction upon each such Sale shall
equal (a) (i) 2 in the case of a Participating Partner who is not an Eligible
Executive Officer and (ii) 3 in the case of a Participating Partner who is an
Eligible Executive Officer, multiplied by (b) the lesser of (i) the number of
Shares involved in such Sale and (ii) the amount by which the aggregate number
of Shares deemed to be held by the Participating Partner immediately after the
Sale is less than Participating Partner’s Share Minimum, provided that (x) if a
Sale occurs before the Participating Partner’s Share Minimum has been
established, then the amount of the Option
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Reduction
upon such Sale shall equal 2 (3 in the case of a Participating Partner who is an
Eligible Executive Officer) multiplied by the number of Shares involved in the
Sale, and (y) if the Company and the Participating Partner have entered into
more than one Stock Option Agreement that contains Option Reduction provisions,
upon each Sale triggering an Option Reduction, such Option Reduction shall be
applied to reduce the number of Shares purchasable under such Stock Option
Agreements in the chronological order in which the Company and Participating
Partner entered into such Stock Option Agreements.
8. GENERALLY
APPLICABLE PROVISIONS
8.1. Amendment and Modification of the
Program. The Board may, from time to time, alter, amend,
suspend or terminate the Program as it shall deem advisable, subject to the
rules and regulations of any stock exchange or quotation system on which Shares
are listed or quoted; provided that the Board may not amend the Program in any
manner that would result in noncompliance with Rule 16b-3 of the Securities
Exchange Act of 1934, as amended; and provided further that no amendments to, or
termination of, the Program shall in any way impair the rights of a
Participating Partner under any Right previously granted without such
Participating Partner’s consent.
8.2. Adjustments. In
the event of any merger, reorganization, consolidation, recapitalization,
dividend or distribution (whether in cash, shares or other property, but without
regard to the payment of any cash dividends by the Company in the ordinary
course), stock split, reverse stock split, spin-off or similar transaction or
other change in corporate structure affecting the Shares or the value thereof,
the terms of the Program and Rights shall be adjusted and such adjustments shall
be as the Committee, in its sole discretion, deems equitable or appropriate,
including such adjustments in the aggregate number, class and kind of securities
that may be delivered under the Program and, in the aggregate or as to any one
Participating Partner, in the number, class, kind and purchase price of
securities subject to outstanding Rights granted under the Program (including,
if the Committee deems appropriate, the substitution of similar rights to
purchase the shares of, or other rights denominated in the shares of, another
company) as the Committee may determine to be appropriate in its sole
discretion; provided, however, that the number of Shares subject to any Right
shall always be a whole number.
8.3. Transferability of
Rights. Except as provided below, and except as otherwise
authorized by the Committee in a Stock Purchase Agreement, no Right and no
Shares subject to Rights described in Section 5 that have not been issued or as
to which any applicable restriction, performance or deferral period has not
lapsed, may be sold, assigned, transferred, pledged or otherwise encumbered,
other than by will or the laws of descent and distribution, or pursuant to a
qualified domestic relations order, and such Right may be exercised during the
life of the Participating Partner only by the Participating Partner or the
Participating Partner’s guardian or legal representative.
9. MISCELLANEOUS
9.1. Tax
Withholding. The Company shall have the right to make all
payments or distributions pursuant to the Program to a Participating Partner net
of any applicable Federal, State and local taxes required to be paid or withheld
as a result of (a) the grant of any Right, (b) the
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exercise
of a Right, (c) the delivery of Shares or cash, (d) the funding of a Program
Loan or (e) any other event occurring pursuant to the Program. The
Company or any Affiliate shall have the right to withhold from wages or other
amounts otherwise payable to a Participating Partner such withholding taxes as
may be required by law, or to otherwise require the Participating Partner to pay
such withholding taxes. If the Participating Partner shall fail to
make such tax payments as are required, the Company or its Affiliates shall, to
the extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to such Participating Partner or to take such
other action as may be necessary to satisfy such withholding
obligations.
9.2. Right of Discharge Reserved; Claims
to Rights. Nothing in the Program nor the grant of an Right
hereunder shall confer upon any Employee the right to continue in the employment
of the Company or any Affiliate or affect any right that the Company or any
Affiliate may have to terminate the employment or service of (or to demote or to
exclude from future Rights under the Program) any such Employee at any time for
any reason. Except as specifically provided by the Committee, the
Company shall not be liable for the loss of existing or potential profit from a
Right granted in the event of termination of an employment or other
relationship. No Employee or Participating Partner shall have any
claim to be granted any Right under the Program, and, except as expressly
provided in the Program, there is no obligation for uniformity of treatment of
Employees or Participating Partners under the Program.
9.3. Prospective
Recipient. The prospective recipient of any benefit under the
Program shall not, with respect to such benefit, be deemed to have become a
Participating Partner, or to have any rights with respect to such benefit, until
and unless such recipient shall have executed an agreement or other instrument
evidencing the benefit and delivered a copy thereof to the Company, and
otherwise complied with the then applicable terms and conditions of the
Program.
9.4. Cancellation of
Right. Notwithstanding anything to the contrary contained
herein, all outstanding Rights granted to any Participating Partner shall be
canceled if the Participating Partner, without the consent of the Company, while
employed by the Company or any Affiliate or after termination of such employment
or service, establishes a relationship with a competitor of the Company or any
Affiliate or engages in activity that is in conflict with or adverse to the
interest of the Company or any Affiliate, as determined by the Committee in its
sole discretion.
9.5. Stop Transfer
Orders. All certificates for Shares delivered under the
Program pursuant to any Right shall be subject to such stop-transfer orders and
other restrictions as the Committee may deem advisable under the rules,
regulations and other requirements of the Securities and Exchange Commission,
any stock exchange upon which the Shares are then listed, and any applicable
federal or state securities law, and the Committee may cause a legend or legends
to be put on any such certificates to make appropriate reference to such
restrictions.
9.6. Nature of
Payments. All Rights and Program Loans granted under the
Program are in consideration of services performed or to be performed for the
Company or any Affiliate, division or business unit of the
Company. Any income or gain realized pursuant to Rights and Program
Loans under the Program constitute a special incentive payment to the
Participating Partner and shall not be taken into account, to the extent
permissible under applicable law, as compensation for purposes of any of the
employee benefit plans of the Company or any Affiliate
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except as
may be determined by the Committee or by the Board or the board of directors of
the applicable Affiliate.
9.7. Other
Programs. Nothing contained in the Program shall prevent the
Board from adopting other or additional compensation arrangements, subject to
shareholder approval if such approval is required; and such arrangements may be
either generally applicable or applicable only in specific cases.
9.8. Severability. If
any provision of the Program shall be held unlawful or otherwise invalid or
unenforceable in whole or in part by a court of competent jurisdiction, such
provision shall (a) be deemed limited to the extent that such court of competent
jurisdiction deems it lawful, valid and/or enforceable and as so limited shall
remain in full force and effect, and (b) not affect any other provision of the
Program or part thereof, each of which shall remain in full force and
effect. If the making of any payment or the provision of any other
benefit required under the Program shall be held unlawful or otherwise invalid
or unenforceable by a court of competent jurisdiction, such unlawfulness,
invalidity or unenforceability shall not prevent any other payment or benefit
from being made or provided under the Program, and if the making of any payment
in full or the provision of any other benefit required under the Program in full
would be unlawful or otherwise invalid or unenforceable, then such unlawfulness,
invalidity or unenforceability shall not prevent such payment or benefit from
being made or provided in part, to the extent that it would not be unlawful,
invalid or unenforceable, and the maximum payment or benefit that would not be
unlawful, invalid or unenforceable shall be made or provided under the
Program.
9.9. Construction. All
references in the Program to “Section or Sections” are
intended to refer to the Section or Sections, as the case may be, of the
Program. As used in the Program, the words “include” and “including,” and variations
thereof, shall not be deemed to be terms of limitation, but rather shall be
deemed to be followed by the words “without
limitation.”
9.10. Unfunded Status of the
Program. The Program is intended to constitute an “unfunded”
pan for incentive and deferred compensation. With respect to any
payments not yet made to a Participating Partner by the Company, nothing
contained herein shall give any such Participating Partner any rights that are
greater than those of a general creditor of the Company. In its sole
discretion, the Committee may authorize the creation of trusts or other
arrangements to meet the obligations created under the Program to deliver the
Shares or payments in lieu of or with respect to rights hereunder; provided,
however, that the existence of such trusts or other arrangements is consistent
with the unfunded status of the Program.
9.11. Governing Law. The
Program and all determinations made and actions taken thereunder, to the extent
not otherwise governed by the Internal Revenue Code or the laws of the United
States, shall be governed by the laws of the State of Virginia and construed
accordingly.
9.12. Effective Date of Program;
Termination of Program. The Program shall be effective as of
December 17, 2009. Rights and Program Loans may be granted and Shares
may be purchased under the Program at any time and from time to time until all
Shares available under the Program have been Purchased by Participating
Partners.
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9.13. Foreign
Employees. Rights and Program Loans may be granted to
Participating Partners who are foreign nationals or employed outside the United
States, or both, on such terms and conditions different from those applicable to
Rights and Program Loans granted to Employees employed in the United States as
may, in the judgment of the Committee, be necessary or desirable in order to
recognize differences in local law or tax policy. The Committee also
may impose conditions on the exercise of Rights in order to minimize the
Company’s obligation with respect to tax equalization for Employees on
assignments outside their home country.
9.14. Captions. The
captions in the Program are for convenience of reference only, and are not
intended to narrow, limit or affect the substance or interpretation of the
provisions contained herein.
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