Exhibit 10.1

AMENDED AND RESTATED INSTITUTIONAL FINANCIAL MARKETS, INC.

2010 LONG-TERM INCENTIVE PLAN

Institutional Financial Markets, Inc., a Maryland corporation, wishes to attract
key employees, Directors, officers, advisors and consultants to the Company and
Subsidiaries, and induce key employees, Directors, officers, advisors,
consultants and other personnel to remain with the Company and Subsidiaries and
encourage them to increase their efforts to make the Company’s business more
successful whether directly or through Subsidiaries or other Affiliates. In
furtherance thereof, the Institutional Financial Markets, Inc. 2010 Long-Term
Incentive Plan is designed to provide equity-based incentives to certain
Eligible Persons. Awards under the Plan may be made to Eligible Persons in the
form of Options (including Stock Appreciation Rights), Restricted Stock,
Restricted Stock Units, Dividend Equivalent Rights and other forms of equity
based Awards as contemplated herein.

WHEREAS, effective February 3, 2011, the Board amended the Plan (the “February
2011 Amendment”) to reflect the change in the Company’s name to “Institutional
Financial Markets, Inc.” and to increase the number of shares available for
Awards under the Plan from 1,580,000 to 3,580,000;

WHEREAS, effective April 18, 2011, the Board amended the Plan (together with the
February 2011 Amendment, the “Amendment”) to increase the number of shares
available for Awards under the Plan from 3,580,000 to 4,580,000;

WHEREAS, the stockholders of the Company approved the Amendment on June 7, 2011;

WHEREAS, the Board desires to amend and restate the Company’s 2011 Long-Term
Incentive Plan in its entirety; and

WHEREAS, capitalized terms used but not defined herein shall have the respective
meanings ascribed thereto in the Plan.

 

1. DEFINITIONS

Whenever used herein, the following terms shall have the meanings set forth
below:

“Affiliate” means any entity other than a Subsidiary that is controlled by or
under common control with the Company that is designated as an “Affiliate” by
the Committee in its discretion.

“Award” except where referring to a particular category of grant under the Plan,
shall include Options, Restricted Stock, RSUs, Dividend Equivalent Rights and
other equity-based Awards as contemplated herein.

 

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“Award Agreement” means a written agreement in a form approved by the Committee,
as provided in Section 3. An Award Agreement may be, without limitation, an
employment or other similar agreement containing provisions governing grants
hereunder, if approved by the Committee for use under the Plan.

“Board” means the Board of Directors of the Company.

“Cause” means, unless otherwise provided in the Participant’s Award Agreement
(i) engaging in (A) willful or gross misconduct or (B) willful or gross neglect;
(ii) repeatedly failing to adhere to the directions of superiors or the Board or
the written policies and practices of the Company, Subsidiaries or Affiliates;
(iii) the commission of a felony or a crime of moral turpitude, dishonesty,
breach of trust or unethical business conduct, or any crime involving the
Company, Subsidiaries, or Affiliates; (iv) fraud, misappropriation or
embezzlement; (v) acts or omissions constituting a material failure to perform
substantially and adequately the duties assigned to the Participant; (vi) any
illegal act detrimental to the Company, Subsidiaries or Affiliates;
(vii) repeated failure to devote substantially all of the Participant’s business
time and efforts to the Company, Subsidiaries, or Affiliates if required by the
Participant’s employment agreement; or (viii) the Participant’s failure to
competently perform his duties after receiving notice from the Company, a
Subsidiary, or Affiliate, specifically identifying the manner in which the
Participant has failed to perform; provided, however, that, if at any particular
time the Participant is subject to an effective employment agreement with the
Company, a Subsidiary or Affiliate, then, in lieu of the foregoing definition,
“Cause” shall at that time have such meaning as may be specified in such
employment agreement.

“Change in Control” means the happening of any of the following:

 

  (i) any “person,” including a “group” (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), but excluding Daniel G. Cohen, Christopher Ricciardi, Parent,
the Company, any entity or person controlling, controlled by or under common
control with Daniel G. Cohen, Christopher Ricciardi, Parent, the Company, any
employee benefit plan of Parent, the Company or any such entity, and Executive
and any “group” (as such term is used in Section 13(d)(3) of the Exchange Act)
of which the Executive is a member) is or becomes the “beneficial owner” (as
defined in Rule 13(d)(3) under the Exchange Act), directly or indirectly, of
securities of Parent representing 50% or more of either (A) the combined voting
power of Parent’s then outstanding securities or (B) the then outstanding common
stock of Parent (in either such case other than as a result of an acquisition of
securities directly from Parent, the Company or any of their respective
subsidiaries); provided, however, that, in no event shall a Change in Control be
deemed to have occurred upon an initial public offering or a subsequent public
offering of the common stock of Parent under the Securities Act of 1933, as
amended; or

 

  (ii)

any consolidation or merger of Parent where the stockholders of Parent,
immediately prior to the consolidation or merger, would not, immediately after
the consolidation or merger, beneficially own (as such term is defined in Rule
13d-3 under the Exchange Act), directly or indirectly, shares representing in
the

 

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  aggregate 50% or more of the combined voting power of the securities of the
corporation issuing cash or securities in the consolidation or merger (or of its
ultimate parent corporation, if any);

 

  (iii) there shall occur (A) any sale, lease, exchange or other transfer (in
one transaction or a series of transactions contemplated or arranged by any
party as a single plan) of all or substantially all of the assets of Parent,
other than a sale or disposition by Parent of all or substantially all of
Parent’s assets to an entity, at least 50% of the combined voting power of the
voting securities of which are owned by “persons” (as defined above) in
substantially the same proportion as their ownership of Parent immediately prior
to such sale or (B) the approval by stockholders of Parent of any plan or
proposal for the liquidation or dissolution of Parent; or

 

  (iv) the members of the Board of Directors of Parent at the beginning of any
consecutive 24-calendar-month period (the “Incumbent Directors”) cease for any
reason other than due to death to constitute at least a majority of the members
of the Board of Directors of Parent; provided that any director whose election,
or nomination for election by Parent’s stockholders, was approved by a vote of
at least a majority of the members of the Board of Directors of Parent then
still in office who were members of the Board of Directors of Parent at the
beginning of such 24-calendar-month period, shall be deemed to be an Incumbent
Director.

Notwithstanding the foregoing provisions of this definition of Change in
Control, if at any time the Participant is subject to an effective employment
agreement with the Company, a Subsidiary or Affiliate which expressly provides
for the definition of a change in control of the Company, then, in lieu of the
foregoing definition, “Change in Control” shall at that time have such meaning
as may be specified, in such employment agreement, with respect to the Company.

Notwithstanding the foregoing, if an event constitutes a Change in Control as
described above but does not constitute a “change in the ownership”, “change in
effective control” or “change in the ownership of a substantial portion of the
assets” of the Company, as such terms are defined in Treasury Regulations §
1.409A-3 (or other applicable guidance issued under Section 409A of the Code)
then such event shall not be deemed a Change in Control to the extent that it
would result in the imposition of the 20% excise tax as set forth in
Section 409A(a)(1)(B). Such event may however, continue to constitute a Change
in Control to the extent possible (e.g., vesting without an acceleration of
distribution) without causing the imposition of such 20% tax.

“Code” means the Internal Revenue Code of 1986, as amended.

“Committee” means the Compensation Committee of the Board.

“Common Stock” means the Company’s Common Stock, par value $.001 per share,
either currently existing or authorized hereafter.

“Company” means Institutional Financial Markets, Inc., a Maryland corporation.

“Director” means a non-employee director of the Company or Subsidiary that is
not an employee of the Company or a Subsidiary.

 

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“Disability” means, unless otherwise provided by the Committee in the
Participant’s Award Agreement, a disability which renders the Participant
incapable of performing all of his or her duties for a period of at least 180
consecutive or non-consecutive days during any consecutive twelve-month period.
Notwithstanding the foregoing, no circumstances or condition shall constitute a
Disability to the extent that, if it were, a 20% tax would be imposed under
Section 409A of the Code; provided that, in such a case, the event or condition
shall continue to constitute a Disability to the maximum extent possible (e.g.,
if applicable, in respect of vesting without an acceleration of distribution)
without causing the imposition of such 20% tax.

“Dividend Equivalent Right” means a right awarded under Section 8 to receive (or
have credited) the equivalent value of dividends paid on Common Stock.

“Eligible Person” means (i) a key employee, Director, officer, advisor,
consultant or other personnel of the Company or Subsidiaries or other person
expected to provide significant services (of a type expressly approved by the
Committee as covered services for these purposes) to the Company or Subsidiaries
or (ii) joint venture affiliates of the Company or other entities designated in
the discretion of the Committee, or officers, directors, employees, members, or
managers of the foregoing. In the case of grants directly or indirectly to
employees of entities described in clause (ii) of the foregoing sentence, the
Committee may make arrangements with such entities as it may consider
appropriate in its discretion, in light of tax and other considerations.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Fair Market Value” per Share as of a particular date means (i) if Shares are
then listed on a national securities exchange, the closing sales price per Share
on the exchange for the last preceding date on which there was a sale of Shares
on such exchange, as determined by the Committee, (ii) if Shares are not then
listed on a national securities exchange but are then traded on an
over-the-counter market, the average of the closing bid and asked prices for the
Shares in such over-the-counter market for the last preceding date on which
there was a sale of such Shares in such market, as determined by the Committee,
or (iii) if Shares are not then listed on a national securities exchange or
traded on an over-the-counter market, such value as the Committee in its
discretion may in good faith determine; provided that, where the Shares are so
listed or traded, the Committee may make such discretionary determinations where
the Shares have not been traded for 10 consecutive trading days.

“Grantee” means an Eligible Person granted Restricted Stock, RSUs, Dividend
Equivalent Rights or such other equity-based Awards (other than an Option) as
may be granted pursuant to Section 9.

“Incentive Stock Option” means an “incentive stock option” within the meaning of
Section 422(b) of the Code.

“Non-Qualified Stock Option” means an Option which is not an Incentive Stock
Option.

“Option” means the right to purchase, at a price and for the term fixed by the
Committee in accordance with the Plan, and subject to such other limitations and
restrictions in the Plan and the applicable Award Agreement, a number of Shares
determined by the Committee.

 

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“Optionee” means an Eligible Person to whom an Option is granted, or the
Successors of the Optionee, as the context so requires.

“Option Price” means the price per Share, determined by the Board or the
Committee, at which an Option may be exercised.

“Participant” means a Grantee or Optionee.

“Performance Goals” has the meaning set forth in Section 10.

“Plan” means the Company’s 2010 Long-Term Incentive Plan, as set forth herein
and as the same may from time to time be amended.

“Restricted Stock” means an award of Shares that are subject to restrictions
hereunder.

“Restricted Stock Unit” or “RSU” means a right, pursuant to the Plan, of the
Grantee to payment of the RSU Value.

“RSU Value,” per RSU, means the Fair Market Value of a Share or, if so provided
by the Committee, such Fair Market Value to the extent in excess of a base value
established by the Committee at the time of grant.

“Retirement” means, unless otherwise provided by the Committee in the
Participant’s Award Agreement, the Termination of Service (other than for Cause)
of a Participant on or after the Participant’s attainment of age 65 or on or
after the Participant’s attainment of age 55 with five consecutive years of
service with the Company, Subsidiaries or Affiliates.

“Securities Act” means the Securities Act of 1933, as amended.

“Settlement Date” means the date determined under Section 7.4(c).

“Shares” means shares of Common Stock of the Company.

“Stock Appreciation Right” means an Option described in Section 5.7.

“Subsidiary” means any corporation, partnership or other entity of which at
least 50% of the economic interest in the equity is owned (directly or
indirectly) by the Company or by another subsidiary. In the event the Company
becomes such a subsidiary of another company (directly or indirectly), the
provisions hereof applicable to subsidiaries shall, unless otherwise determined
by the Committee, also be applicable to such parent company.

“Successor of the Optionee” means the legal representative of the estate of a
deceased Optionee or the person or persons who shall acquire the right to
exercise an Option by bequest or inheritance or by reason of the death of the
Optionee.

“Termination Event” means a Change in Control.

 

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“Termination of Service” means a Participant’s termination of employment or
other service (as a consultant or otherwise), as applicable, with the Company,
Subsidiaries and Affiliates.

 

2. EFFECTIVE DATE AND TERMINATION OF PLAN

The effective date of the Plan is April 22, 2010. The Plan shall terminate on,
and no Award shall be granted hereunder on or after, the 10-year anniversary of
the earlier of the approval of the Plan by (i) the Board or (ii) the
stockholders of the Company; provided, however, that the Board may at any time
prior to that date terminate the Plan.

 

3. ADMINISTRATION OF PLAN

(a) The Plan shall be administered by the Committee. The Committee, upon and
after such time as it is subject to Section 16 of the Exchange Act, shall
consist of at least two individuals each of whom shall be a “nonemployee
director” as defined in Rule 16b-3 as promulgated by the Securities and Exchange
Commission (“Rule 16b-3”) under the Exchange Act and shall, at such times as the
Company is subject to Section 162(m) of the Code (to the extent relief from the
limitation of Section 162(m) of the Code is sought with respect to Awards),
qualify as “outside directors” for purposes of Section 162(m) of the Code;
provided that no action taken by the Committee (including, without limitation,
grants) shall be invalidated because any or all of the members of the Committee
fails to satisfy the foregoing requirements of this sentence. The acts of a
majority of the members present at any meeting of the Committee at which a
quorum is present, or acts approved in writing by a majority of the entire
Committee, shall be the acts of the Committee for purposes of the Plan. If and
to the extent applicable, no member of the Committee may act as to matters under
the Plan specifically relating to such member. Notwithstanding the other
foregoing provisions of this Section 3(a), any Award under the Plan to a person
who is a member of the Committee shall be made and administered by the Board. If
no Committee is designated by the Board to act for these purposes, the Board
shall have the rights and responsibilities of the Committee hereunder and under
the Award Agreements.

(b) Subject to the provisions of the Plan, the Committee shall in its discretion
as reflected by the terms of the Award Agreements (i) authorize the granting of
Awards to Eligible Persons and (ii) determine the eligibility of Eligible
Persons to receive an Award, as well as determine the number of Shares to be
covered under any Award Agreement, considering the position and responsibilities
of the Eligible Persons, the nature and value to the Company of the Eligible
Person’s present and potential contribution to the success of the Company
whether directly or through Subsidiaries or Affiliates and such other factors as
the Committee may deem relevant.

(c) The Award Agreement shall contain such other terms, provisions and
conditions not inconsistent herewith as shall be determined by the Committee. In
the event that any Award Agreement or other agreement hereunder provides
(without regard to this sentence) for the obligation of the Company,
Subsidiaries or Affiliates to purchase or repurchase Shares from a Participant
or any other person, then, notwithstanding the

 

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provisions of the Award Agreement or such other agreement, such obligation shall
not apply to the extent that the purchase or repurchase would not be permitted
under governing state law. The Participant shall take whatever additional
actions and execute whatever additional documents the Committee may in its
reasonable judgment deem necessary or advisable in order to carry out or effect
one or more of the obligations or restrictions imposed on the Participant
pursuant to the express provisions of the Plan and the Award Agreement.

 

4. SHARES AND UNITS SUBJECT TO THE PLAN.

 

  4.1 In General.

(a) Subject to adjustments as provided in Section 14, the total number of Shares
subject to Awards granted under the Plan (including securities convertible into
or exchangeable for Shares), in the aggregate, may not exceed 4,580,000. In no
event may an Eligible Person receive Options for more than 500,000 Shares on an
annual basis, and the maximum number of Shares that may underlie Awards, other
than Options, granted in any one year to any Eligible Person, shall not exceed
500,000. Shares distributed under the Plan may be treasury Shares or authorized
but unissued Shares. Any Shares that have been granted as Restricted Stock or
that have been reserved for distribution in payment for Options, RSUs or other
equity-based Awards but are later forfeited or for any other reason are not
payable under the Plan may again be made the subject of Awards under the Plan.

(b) Shares subject to Dividend Equivalent Rights, other than Dividend Equivalent
Rights based directly on the dividends payable with respect to Shares subject to
Options or the dividends payable on a number of Shares corresponding to the
number of RSUs awarded, shall be subject to the limitation of Section 4.1(a).
Notwithstanding Section 4.1(a), except in the case of Awards intended to qualify
for relief from the limitations of Section 162(m) of the Code, there shall be no
limit on the number of RSUs or Dividend Equivalent Rights to the extent they are
paid out in cash that may be granted under the Plan. If any RSUs, Dividend
Equivalent Rights or other equity-based Awards under Section 9 are paid out in
cash, then, notwithstanding the first sentence of Section 4.1(a) above (but
subject to the second sentence thereof) the underlying Shares may again be made
the subject of Awards under the Plan.

(c) The certificates for Shares issued hereunder may include any legend which
the Committee deems appropriate to reflect any rights of first refusal or
restrictions on transfer hereunder or under the Award Agreement, or as the
Committee may otherwise deem appropriate.

 

  4.2 Options.

Subject to adjustments pursuant to Section 14, and subject to the last sentence
of Section 4.1(a), Options with respect to an aggregate of no more than
4,580,000 Shares may be granted under the Plan.

 

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5. PROVISIONS APPLICABLE TO STOCK OPTIONS.

 

  5.1 Grant of Option.

Subject to the other terms of the Plan, the Committee shall, in its discretion
as reflected by the terms of the applicable Award Agreement: (i) determine and
designate from time to time those Eligible Persons to whom Options are to be
granted and the number of Shares to be optioned to each Eligible Person;
(ii) determine whether to grant Options intended to be Incentive Stock Options,
or to grant Non-Qualified Stock Options, or both (to the extent that any Option
does not qualify as an Incentive Stock Option, it shall constitute a separate
Non-Qualified Stock Option); provided that Incentive Stock Options may only be
granted to employees of the Company, Subsidiaries or Affiliates; (iii) determine
the time or times when and the manner and condition in which each Option shall
be exercisable and the duration of the exercise period; (iv) designate each
Option as one intended to be an Incentive Stock Option or as a Non-Qualified
Stock Option; and (v) determine or impose other conditions to the grant or
exercise of Options under the Plan as it may deem appropriate.

 

  5.2 Option Price.

The Option Price shall be determined by the Committee on the date the Option is
granted and reflected in the Award Agreement, as the same may be amended from
time to time. Any particular Award Agreement may provide for different Option
Prices for specified amounts of Shares subject to the Option; provided that the
Option Price shall not be less than 100% of the Fair Market Value of a Share on
the day the Option is granted.

 

  5.3 Period of Option and Vesting.

(a) Unless earlier expired, forfeited or otherwise terminated, each Option shall
expire in its entirety upon the 10th anniversary of the date of grant or shall
have such other term as is set forth in the applicable Award Agreement. The
Option shall also expire, be forfeited and terminate at such times and in such
circumstances as otherwise provided hereunder or under the Award Agreement.

(b) Each Option, to the extent that the Optionee has not had a Termination of
Service and the Option has not otherwise lapsed, expired, terminated or been
forfeited, shall first become exercisable according to the terms and conditions
set forth in the Award Agreement, as determined by the Committee at the time of
grant. Unless otherwise provided in the Plan or the Award Agreement, no Option
(or portion thereof) shall ever be exercisable if the Optionee has a Termination
of Service before the time at which such Option (or portion thereof) would
otherwise have become exercisable, and any Option that would otherwise become
exercisable after such Termination of Service shall not become exercisable and
shall be forfeited upon such termination. Notwithstanding the foregoing
provisions of this Section 5.3(b), Options exercisable pursuant to the schedule
set forth by the Committee at the time of the grant may be fully or more rapidly
exercisable or otherwise vested at any time in the discretion of the Committee.
Upon and after the death of an Optionee, such Optionee’s Options, if and to the
extent otherwise exercisable hereunder or under the applicable Award Agreement
after the Optionee’s death, may be exercised by the Successors of the Optionee.

 

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  5.4 Exercisability Upon and After Termination of Optionee.

(a) Subject to provisions of the Award Agreement, if an Optionee has a
Termination of Service other than by the Company or Subsidiaries for Cause, or
other than by reason of death, Retirement or Disability, then no exercise of an
Option may occur after the expiration of the three-month period to follow the
termination, or if earlier, the expiration of the term of the Option as provided
under Section 5.3(a); provided that, if the Optionee should die after the
Termination of Service, but while the Option is still in effect, the Option (if
and to the extent otherwise exercisable by the Optionee at the time of death)
may be exercised until the earlier of (i) one year from the date of the
Termination of Service of the Optionee, or (ii) the date on which the term of
the Option expires in accordance with Section 5.3(a).

(b) Subject to provisions of the Award Agreement, in the event the Optionee has
a Termination of Service on account of death, Disability or Retirement, the
Option (whether or not otherwise exercisable) may be exercised until the earlier
of (i) one year from the date of the Termination of Service of the Optionee, or
(ii) the date on which the term of the Option expires in accordance with
Section 5.3.

(c) Notwithstanding any other provision hereof, unless otherwise provided in the
Award Agreement, if the Optionee has a Termination of Service for Cause, the
Optionee’s Options, to the extent then unexercised, shall thereupon cease to be
exercisable and shall be forfeited forthwith.

 

  5.5 Exercise of Options.

(a) Subject to vesting, restrictions on exercisability and other restrictions
provided for hereunder or otherwise imposed in accordance herewith, an Option
may be exercised, and payment in full of the aggregate Option Price made, by an
Optionee only by written notice (in the form prescribed by the Committee) to the
Company or its designee specifying the number of Shares to be purchased.

(b) Without limiting the scope of the Committee’s discretion hereunder, the
Committee may impose such other restrictions on the exercise of Options (whether
or not in the nature of the foregoing restrictions) as it may deem necessary or
appropriate.

 

  5.6 Payment.

(a) The aggregate Option Price shall be paid in full upon the exercise of the
Option. Payment must be made by one of the following methods:

(i) certified or bank cashier’s check;

(ii) subject to Section 12(e), the proceeds of a Company loan program or
third-party sale program or a notice acceptable to the Committee given as

 

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consideration under such a program, in each case if permitted by the Committee
in its discretion, if such a program has been established and the Optionee is
eligible to participate therein;

(iii) if approved by the Committee in its discretion, Shares of previously owned
Common Stock, which have been previously owned for more than six months, having
an aggregate Fair Market Value on the date of exercise equal to the aggregate
Option Price; or

(iv) if approved by the Committee in its discretion, through the written
election of the Optionee to have Shares withheld by the Company from the Shares
otherwise to be received, with such withheld Shares having an aggregate Fair
Market Value on the date of exercise equal to the aggregate Option Price; or

(v) by any combination of such methods of payment or any other method acceptable
to the Committee in its discretion.

(b) Except in the case of Options exercised by certified or bank cashier’s
check, the Committee may impose limitations and prohibitions on the exercise of
Options as it deems appropriate, including, without limitation, any limitation
or prohibition designed to avoid accounting consequences which may result from
the use of Common Stock as payment upon exercise of an Option.

(c) The Committee may provide that no Option may be exercised with respect to
any fractional Share. Any fractional Shares resulting from an Optionee’s
exercise that is accepted by the Company shall in the discretion of the
Committee be paid in cash.

 

  5.7 Stock Appreciation Rights.

(a) The Committee, in its discretion, may also permit (taking into account,
without limitation, the application of Section 409A of the Code, as the
Committee may deem appropriate) the Optionee to elect to receive upon the
exercise of an Option a combination of Shares and cash, or, in the discretion of
the Committee, either Shares or solely in cash, with an aggregate Fair Market
Value (or, to the extent of payment in cash, in an amount) equal to the excess
of the Fair Market Value of the Shares with respect to which the Option is being
exercised over the aggregate Option Price, as determined as of the day the
Option is exercised.

(b) Upon the exercise of any Stock Appreciation Rights, the greater of (i) the
number of shares subject to the Stock Appreciation Rights so exercised, and
(ii) the number of Shares, if any, that are issued in connection with such
exercise, shall be deducted from the number of Shares available for issuance
under the Plan.

(c) In no event may a Stock Appreciation Right be transferred by a holder
thereof for consideration without the prior approval of the Company’s
stockholders.

 

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  5.8 Exercise by Successors.

An Option may be exercised, and payment in full of the aggregate Option Price
made, by the Successors of the Optionee only by written notice (in the form
prescribed by the Committee) to the Company specifying the number of Shares to
be purchased. Such notice shall state that the aggregate Option Price will be
paid in full, or that the Option will be exercised as otherwise provided
hereunder, in the discretion of the Company or the Committee, if and as
applicable.

 

  5.9 Nontransferability of Option.

Each Option granted under the Plan shall be nontransferable by the Optionee
except by will or the laws of descent and distribution of the state wherein the
Optionee is domiciled at the time of his death; provided, however, that the
Committee may (but need not) permit other transfers, where the Committee
concludes that such transferability (i) does not result in accelerated U.S.
federal income taxation, (ii) does not cause any Option intended to be an
Incentive Stock Option to fail to be described in Section 422(b) of the Code,
(iii) complies with applicable law, including securities laws, and (iv) is
otherwise appropriate and desirable. In no event may an Option be transferred by
an Optionee for consideration without the prior approval of the Company’s
stockholders.

 

  5.10 Deferral.

The Committee (taking into account, without limitation, the possible application
of Section 409A of the Code, as the Committee may deem appropriate) may
establish a program under which Participants will have RSUs subject to Section 7
credited upon their exercise of Options, rather than receiving Shares at that
time.

 

  5.11 Certain Incentive Stock Option Provisions.

(a) In no event may an Incentive Stock Option be granted other than to employees
of the Company or a “subsidiary corporation” or a “parent corporation,” as each
is defined in Section 424(f) of the Code, with respect to the Company. The
aggregate Fair Market Value, determined as of the date an Option is granted, of
the Common Stock for which any Optionee may be awarded Incentive Stock Options
which are first exercisable by the Optionee during any calendar year under the
Plan (or any other stock option plan required to be taken into account under
Section 422(d) of the Code) shall not exceed $100,000. To the extent the
$100,000 limit referred to in the preceding sentence is exceeded, an Option will
be treated as a Non-Qualified Stock Option.

(b) If Shares acquired upon exercise of an Incentive Stock Option are disposed
of in a disqualifying disposition within the meaning of Section 422 of the Code
by an Optionee prior to the expiration of either two years from the date of
grant of such Option or one year from the transfer of Shares to the Optionee
pursuant to the exercise of such Option, or in any other disqualifying
disposition within the meaning of Section 422 of the Code, such Optionee shall
notify the Company in writing as soon as practicable thereafter of the date and
terms of such disposition and, if the Company (or an Affiliate) thereupon has a
tax-withholding obligation, shall pay to the Company (or such Affiliate) an
amount equal to any withholding tax the Company (or Affiliate) is required to
pay as a result of the disqualifying disposition.

 

11

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(c) The Option Price with respect to each Incentive Stock Option shall not be
less than 100%, or 110% in the case of an individual described in
Section 422(b)(6) of the Code (relating to certain 10% owners), of the Fair
Market Value of a Share on the day the Option is granted. Also, in the case of
such an individual who is granted an Incentive Stock Option, the term of such
Option shall be no more than five years from the date of grant.

 

6. PROVISIONS APPLICABLE TO RESTRICTED STOCK.

 

  6.1 Grant of Restricted Stock.

(a) In connection with the grant of Restricted Stock, whether or not performance
goals (as provided for under Section 10) apply thereto, the Committee shall
establish one or more vesting periods with respect to the shares of Restricted
Stock granted, the length of which shall be determined in the discretion of the
Committee. Subject to the provisions of this Section 6, the applicable Award
Agreement and the other provisions of the Plan, restrictions on Restricted Stock
shall lapse if the Grantee satisfies all applicable employment or other service
requirements through the end of the applicable vesting period.

(b) Subject to the other terms of the Plan, the Committee may, in its discretion
as reflected by the terms of the applicable Award Agreement: (i) authorize the
granting of Restricted Stock to Eligible Persons; (ii) provide a specified
purchase price for the Restricted Stock (whether or not the payment of a
purchase price is required by any state law applicable to the Company);
(iii) determine the restrictions applicable to Restricted Stock and
(iv) determine or impose other conditions, including any applicable Performance
Goals, to the grant of Restricted Stock under the Plan as it may deem
appropriate.

 

  6.2 Certificates/Book Entry.

(a) Unless otherwise provided by the Committee, a “book entry” (by computerized
or manual entry) shall be made in the records of the Company (or, if applicable,
the Company’s transfer agent) to evidence an award of Shares of Restricted
Stock.

(b) If the Shares of Restricted Stock are not evidenced in “book entry” form in
accordance with Section 6.2(a), each Grantee of Restricted Stock shall be issued
a stock certificate in respect of Shares of Restricted Stock awarded under the
Plan. Each such certificate shall be registered in the name of the Grantee.
Without limiting the generality of Section 4.1(c), the certificates for Shares
of Restricted Stock issued hereunder may include any legend which the Committee
deems appropriate to reflect any restrictions on transfer hereunder or under the
Award Agreement, or as the Committee may otherwise deem appropriate, and,
without limiting the generality of the foregoing, shall bear a legend referring
to the terms, conditions, and restrictions applicable to such Award,
substantially in the following form:

THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED
HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING FORFEITURE) OF THE
INSTITUTIONAL FINANCIAL MARKETS, INC. 2010 LONG-TERM INCENTIVE PLAN AND AN AWARD
AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND INSTITUTIONAL FINANCIAL
MARKETS, INC. COPIES OF SUCH PLAN AND AWARD AGREEMENT ARE ON FILE IN THE OFFICES
OF INSTITUTIONAL FINANCIAL MARKETS, INC. AT CIRA CENTRE, 2929 ARCH STREET, 17th
FLOOR, PHILADELPHIA, PENNSYLVANIA 19104.

 

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(c) The Committee shall require that any stock certificates evidencing such
Shares be held in custody by the Company or its designee until the restrictions
hereunder shall have lapsed, and that, as a condition of any Award of Restricted
Stock, the Grantee shall have delivered to the Company or its designee a stock
power, endorsed in blank, relating to the stock covered by such Award. If and
when such restrictions so lapse, the stock certificates shall be delivered by
the Company to the Grantee or his or her designee as provided in Section 6.3
(and the stock power shall cease to be of effect).

 

  6.3 Restrictions and Conditions.

Unless otherwise provided by the Committee, the Shares of Restricted Stock
awarded pursuant to the Plan shall be subject to the following restrictions and
conditions:

(i) Subject to the provisions of the Plan and the Award Agreements, during a
period commencing with the date of such Award and ending on the date the period
of forfeiture with respect to such Shares lapses, the Grantee shall not be
permitted voluntarily or involuntarily to sell, transfer, pledge, anticipate,
alienate, encumber or assign Shares of Restricted Stock awarded under the Plan
(or have such Shares attached or garnished). Subject to the provisions of the
Award Agreements and clause (iii) below, the period of forfeiture with respect
to Shares granted hereunder shall lapse as provided in the applicable Award
Agreement. Notwithstanding the foregoing, unless otherwise expressly provided by
the Committee, the period of forfeiture with respect to such Shares shall only
lapse as to whole Shares.

(ii) Except as provided in the foregoing clause (i), below in this clause (ii),
or as otherwise provided in the applicable Award Agreement, the Grantee shall
have, in respect of the Shares of Restricted Stock, all of the rights of a
shareholder of the Company, including the right to vote the Shares and the right
to receive any cash dividends as and when such dividends are declared and paid
by the Company (or as soon as practicable thereafter); provided, however, that
cash dividends on such Shares shall, unless otherwise provided by the Committee,
be held by the Company (unsegregated as a part of its general assets) until the
period

 

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of forfeiture lapses (and forfeited if the underlying Shares are forfeited), and
paid over to the Grantee (without interest) as soon as practicable after such
period lapses (if not forfeited). Certificates for Shares (not subject to
restrictions) shall be delivered to the Grantee or his or her designee promptly
after, and only after, the period of forfeiture shall lapse without forfeiture
in respect of such Shares of Restricted Stock.

(iii) Except as otherwise provided in the applicable Award Agreement, and
subject to clause (iv) below, if the Grantee has a Termination of Service by the
Company and Subsidiaries (or, if applicable, Affiliates) for Cause, or by the
Grantee for any reason during the applicable period of forfeiture, then (A) all
Shares still subject to restriction shall thereupon, and with no further action,
be forfeited by the Grantee, and (B) the Company shall pay to the Grantee as
soon as practicable (and in no event more than 30 days) after such termination
an amount, equal to the lesser of (x) the amount paid by the Grantee for such
forfeited Restricted Stock as contemplated by Section 6.1, and (y) the Fair
Market Value on the date of termination of the forfeited Restricted Stock.

(iv) Subject to the provisions of the Award Agreement, in the event the Grantee
has a Termination of Service on account of death, Disability or Retirement, or
the Grantee has a Termination of Service by the Company and Subsidiaries for any
reason other than Cause, or in the event of a Termination Event (regardless of
whether a termination follows thereafter), during the applicable period of
forfeiture, then restrictions under the Plan will immediately lapse on all
Restricted Stock granted to the applicable Grantee.

 

7. PROVISIONS APPLICABLE TO RESTRICTED STOCK UNITS.

 

  7.1 Grant of RSUs.

Subject to the other terms of the Plan, the Committee shall, in its discretion
as reflected by the terms of the applicable Award Agreement: (i) authorize the
granting of RSUs to Eligible Persons and (ii) determine or impose other
conditions to the grant of RSUs under the Plan as it may deem appropriate.

 

  7.2 Term.

The Committee may provide in an Award Agreement that any particular RSU shall
expire at the end of a specified term.

 

  7.3 Vesting.

RSUs shall vest as provided in the applicable Award Agreement.

 

  7.4 Settlement of RSUs.

(a) Each vested and outstanding RSU shall be settled by the transfer to the
Grantee of one Share; provided that, the Committee at the time of grant (or, in
the

 

14

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appropriate case, as determined by the Committee, thereafter) may provide that,
after consideration of possible accounting issues, an RSU may be settled (i) in
cash at the applicable RSU Value, (ii) in cash or by transfer of Shares as
elected by the Grantee in accordance with procedures established by the
Committee or (iii) in cash or by transfer of Shares as elected by the Company.

(b) Payment (whether of cash or Shares) in respect of RSUs shall be made in a
single sum by the Company; provided that, with respect to RSUs of a Grantee
which have a common Settlement Date, the Committee may permit the Grantee to
elect in accordance with procedures established by the Committee (taking into
account, without limitation, Section 409A of the Code, as the Committee may deem
appropriate) to receive installment payments over a period not to exceed 10
years, rather than a single-sum payment.

(c) Unless otherwise provided in the applicable Award Agreement, the “Settlement
Date” with respect to an RSU is the first day of the month to follow the date on
which the RSU vests; provided that a Grantee may elect, in accordance with
procedures to be established by the Committee, that such Settlement Date will be
deferred as elected by the Grantee to the first day of the month to follow the
Grantee’s Termination of Service, or such other time as may be permitted by the
Committee. Unless otherwise determined by the Committee, elections under this
Section 7.4(c) must, except as may otherwise be permitted under the rules
applicable under Section 409A of the Code, (A) be effective at least one year
after they are made, or, in the case of payments to commence at a specific time,
be made at least one year before the first scheduled payment and (B) defer the
commencement of distributions (and each affected distribution) for at least five
years.

(i) Notwithstanding Section 7.4(c), the Committee may provide that distributions
of RSUs can be elected at any time in those cases in which the RSU Value is
determined by reference to Fair Market Value to the extent in excess of a base
value, rather than by reference to unreduced Fair Market Value.

(ii) Notwithstanding the foregoing, and unless otherwise provided in the
applicable Award Agreement, the Settlement Date, if not earlier pursuant to this
Section 7.4(c), is the date of the Grantee’s death.

(d) Notwithstanding the other provisions of this Section 7, and unless otherwise
provided in the applicable Award Agreement, in the event of a Termination Event,
the Settlement Date shall be the date of such Termination Event and all amounts
due with respect to RSUs to a Grantee hereunder shall be paid as soon as
practicable (but in no event more than 30 days) after such Termination Event,
unless such Grantee elects otherwise in accordance with procedures established
by the Committee.

(e) Notwithstanding any other provision of the Plan, a Grantee may receive any
amounts to be paid in installments as provided in Section 7.4(b) or deferred by
the Grantee as provided in Section 7.4(c) in the event of an “Unforeseeable
Emergency.” For these purposes, an “Unforeseeable Emergency,” as determined by
the Committee in its

 

15

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sole discretion, is a severe financial hardship to the Grantee resulting from a
sudden and unexpected illness or accident of the Grantee or “dependent,” as
defined in Section 152(a) of the Code, of the Grantee, loss of the Grantee’s
property due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Grantee.
The circumstances that will constitute an Unforeseeable Emergency will depend
upon the facts of each case, but, in any case, payment may not be made to the
extent that such hardship is or may be relieved:

(i) through reimbursement or compensation by insurance or otherwise,

(ii) by liquidation of the Grantee’s assets, to the extent the liquidation of
such assets would not itself cause severe financial hardship, or

(iii) by future cessation of the making of additional deferrals under
Section 7.4 (b) and (c).

Without limitation, the need to send a Grantee’s child to college or the desire
to purchase a home shall not constitute an Unforeseeable Emergency.
Distributions of amounts because of an Unforeseeable Emergency shall be
permitted to the extent reasonably needed to satisfy the emergency need.

 

  7.5 Other RSUs Provisions.

(a) Rights to payments with respect to RSUs granted under the Plan shall not be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment, garnishment, levy, execution, or other legal or
equitable process, either voluntary or involuntary; and any attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber, attach or
garnish, or levy or execute on any right to payments or other benefits payable
hereunder, shall be void.

(b) A Grantee may designate in writing, on forms to be prescribed by the
Committee, a beneficiary or beneficiaries to receive any payments payable after
his or her death and may amend or revoke such designation at any time. If no
beneficiary designation is in effect at the time of a Grantee’s death, payments
hereunder (if any) shall be made to the Grantee’s estate. If a Grantee with a
vested RSU dies, such RSU shall be settled and the RSU Value in respect of such
RSUs paid, and any payments deferred pursuant to an election under
Section 7.4(c) shall be accelerated and paid, as soon as practicable (but no
later than 60 days) after the date of death to such Grantee’s beneficiary or
estate, as applicable.

(c) The Committee may establish a program under which distributions with respect
to RSUs may be deferred for periods in addition to those otherwise contemplated
by foregoing provisions of this Section 7. Such program may include, without
limitation, provisions for the crediting of earnings and losses on unpaid
amounts, and, if permitted by the Committee, provisions under which Participants
may select from among hypothetical investment alternatives for such deferred
amounts in accordance with procedures established by the Committee.

 

16

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(d) Notwithstanding any other provision of this Section 7, any fractional RSU
will be paid out in cash at the RSU Value as of the Settlement Date.

(e) No RSU shall be construed to give any Grantee any rights with respect to
Shares or any ownership interest in the Company. Except as may be provided in
accordance with Section 8, no provision of the Plan shall be interpreted to
confer upon any Grantee any voting, dividend or derivative or other similar
rights with respect to any RSU.

 

8. PROVISIONS APPLICABLE TO DIVIDEND EQUIVALENT RIGHTS.

 

  8.1 Grant of Dividend Equivalent Rights.

Subject to the other terms of the Plan, the Committee shall, in its discretion
as reflected by the terms of the Award Agreements, authorize the granting of
Dividend Equivalent Rights to Eligible Persons based on the regular cash
dividends declared on Common Stock, to be credited as of the dividend payment
dates, during the period between the date an Award is granted, and the date such
Award is exercised, vests or expires, as determined by the Committee. Such
Dividend Equivalent Rights shall be converted to cash or additional Shares by
such formula and at such time and subject to such limitation as may be
determined by the Committee. With respect to Dividend Equivalent Rights granted
with respect to Options intended to be qualified performance-based compensation
for purposes of Section 162(m) of the Code, such Dividend Equivalent Rights
shall be payable regardless of whether such Option is exercised. If a Dividend
Equivalent Right is granted in respect of another Award hereunder, then, unless
otherwise stated in the Award Agreement, in no event shall the Dividend
Equivalent Right be in effect for a period beyond the time during which the
applicable portion of the underlying Award is in effect.

 

  8.2 Certain Terms.

(a) The term of a Dividend Equivalent Right shall be set by the Committee in its
discretion.

(b) Unless otherwise determined by the Committee, except as contemplated by
Section 8.4, a Dividend Equivalent Right is exercisable or payable only while
the Participant is an Eligible Person.

(c) Payment of the amount determined in accordance with Section 8.1 shall be in
cash, in Common Stock or a combination of the two, as determined by the
Committee.

(d) The Committee may impose such employment-related conditions on the grant of
a Dividend Equivalent Right as it deems appropriate in its discretion.

 

  8.3 Other Types of Dividend Equivalent Rights.

The Committee may establish a program under which Dividend Equivalent Rights of
a type whether or not described in the foregoing provisions of this Section 8
may be granted to Participants. For example, and without limitation, the
Committee may grant a dividend equivalent right in respect of each Share subject
to an Option or with respect to an RSU, which right would consist of the right
(subject to Section 8.4) to receive a cash payment in an amount equal to the
dividend distributions paid on a Share from time to time.

 

17

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  8.4 Deferral.

The Committee may establish a program (taking into account, without limitation,
the possible application of Section 409A of the Code, as the Committee may deem
appropriate) under which Participants (i) will have RSUs credited, subject to
the terms of Sections 7.4 and 7.5 as though directly applicable with respect
thereto, upon the granting of Dividend Equivalent Rights, or (ii) will have
payments with respect to Dividend Equivalent Rights deferred. In the case of the
foregoing clause (ii), such program may include, without limitation, provisions
for the crediting of earnings and losses on unpaid amounts, and, if permitted by
the Committee, provisions under which Participants may select from among
hypothetical investment alternatives for such deferred amounts in accordance
with procedures established by the Committee.

 

9. OTHER EQUITY-BASED AWARDS.

The Committee shall have the right to grant (i) other Awards based upon the
Common Stock having such terms and conditions as the Committee may determine,
including, without limitation, the grant of Shares based upon certain
conditions, the grant of securities convertible into Common Stock and the grant
of Stock Appreciation Rights and (ii) interests (which may be expressed as units
or otherwise) in Subsidiaries, as applicable.

 

10. PERFORMANCE GOALS.

The Committee, in its discretion, may in the case of Awards (including, in
particular, Awards other than Options) intended to qualify for an exception from
the limitation imposed by Section 162(m) of the Code (“Performance-Based
Awards”), (i) establish one or more performance goals (“Performance Goals”) as a
precondition to the issuance or vesting of Awards, and (ii) provide, in
connection with the establishment of the Performance Goals, for predetermined
Awards to those Participants (who continue to meet all applicable eligibility
requirements) with respect to whom the applicable Performance Goals are
satisfied. The Performance Goals shall be based upon the criteria set forth in
Exhibit A hereto which is hereby incorporated herein by reference as though set
forth in full. The Performance Goals shall be established in a timely fashion
such that they are considered preestablished for purposes of the rules governing
performance-based compensation under Section 162(m) of the Code. Prior to the
award or vesting, as applicable, of affected Awards hereunder, the Committee
shall have certified that any applicable Performance Goals, and other material
terms of the Award, have been satisfied. Performance Goals which do not satisfy
the foregoing provisions of this Section 10 may be established by the Committee
with respect to Awards not intended to qualify for an exception from the
limitations imposed by Section 162(m) of the Code.

 

11. TAX WITHHOLDING.

 

  11.1 In General.

The Company shall be entitled to withhold from any payments or deemed payments
any amount of tax withholding determined by the Committee to be required by law.
Without limiting

 

18

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the generality of the foregoing, the Committee may, in its discretion, require
the Participant to pay to the Company at such time as the Committee determines
the amount that the Committee deems necessary to satisfy the Company’s
obligation to withhold federal, state or local income or other taxes incurred by
reason of (i) the exercise of any Option, (ii) the lapsing of any restrictions
applicable to any Restricted Stock, (iii) the receipt of a distribution in
respect of RSUs or Dividend Equivalent Rights or (iv) any other applicable
income-recognition event (for example, an election under Section 83(b) of the
Code).

 

  11.2 Share Withholding.

(a) Upon exercise of an Option, the Optionee may, if approved by the Company in
its discretion, make a written election to have Shares then issued withheld by
the Company from the Shares otherwise to be received, or to deliver previously
owned Shares, in order to satisfy the liability for such withholding taxes. In
the event that the Optionee makes, and the Company permits, such an election,
the number of Shares so withheld or delivered shall have an aggregate Fair
Market Value on the date of exercise sufficient to satisfy the applicable
withholding taxes. Where the exercise of an Option does not give rise to an
obligation by the Company to withhold federal, state or local income or other
taxes on the date of exercise, but may give rise to such an obligation in the
future, the Company may, in its discretion, make such arrangements and impose
such requirements as it deems necessary or appropriate.

(b) Upon lapsing of restrictions on Restricted Stock (or other
income-recognition event), the Grantee may, if approved by the Company in its
discretion, make a written election to have Shares withheld by the Company from
the Shares otherwise to be released from restriction, or to deliver previously
owned Shares (not subject to restrictions hereunder), in order to satisfy the
liability for such withholding taxes. In the event that the Grantee makes, and
the Company permits, such an election, the number of Shares so withheld or
delivered shall have an aggregate Fair Market Value on the date of exercise
sufficient to satisfy the applicable withholding taxes.

(c) Upon the making of a distribution in respect of RSUs or Dividend Equivalent
Rights, the Grantee may, if approved by the Company in its discretion, make a
written election to have amounts (which may include Shares) withheld by the
Company from the distribution otherwise to be made, or to deliver previously
owned Shares (not subject to restrictions hereunder), in order to satisfy the
liability for such withholding taxes. In the event that the Grantee makes, and
the Company permits, such an election, any Shares so withheld or delivered shall
have an aggregate Fair Market Value on the date of exercise sufficient to
satisfy the applicable withholding taxes.

 

  11.3 Withholding Required.

Notwithstanding anything contained in the Plan or the Award Agreement to the
contrary, the Participant’s satisfaction of any tax-withholding requirements
imposed by the Committee shall be a condition precedent to the Company’s
obligation as may otherwise be provided hereunder to provide Shares to the
Participant and to the release of any restrictions as may otherwise be provided
hereunder, as applicable; and the applicable Option, Restricted Stock,

 

19

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RSUs or Dividend Equivalent Rights shall be forfeited upon the failure of the
Participant to satisfy such requirements with respect to, as applicable, (i) the
exercise of the Option, (ii) the lapsing of restrictions on the Restricted Stock
(or other income-recognition event) or (iii) distributions in respect of any RSU
or Dividend Equivalent Right.

 

12. REGULATIONS AND APPROVALS.

(a) The obligation of the Company to sell Shares with respect to an Award
granted under the Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and the
obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Committee.

(b) The Committee may make such changes to the Plan as may be necessary or
appropriate to comply with the rules and regulations of any government authority
or to obtain tax benefits applicable to an Award.

(c) Each grant of Options, Restricted Stock, RSU (or issuance of Shares in
respect thereof) or Dividend Equivalent Rights (or issuance of Shares in respect
thereof), or other Award under Section 9 (or issuance of Shares in respect
thereof), is subject to the requirement that, if at any time the Committee
determines, in its discretion, that the listing, registration or qualification
of Shares issuable pursuant to the Plan is required by any securities exchange
or under any state or federal law, or the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of, or in
connection with, the issuance of Options, Shares of Restricted Stock, RSUs,
Dividend Equivalent Rights, other Awards or other Shares, no payment shall be
made, or RSUs or Shares issued or grant of Restricted Stock or other Award made,
in whole or in part, unless listing, registration, qualification, consent or
approval has been effected or obtained free of any conditions in a manner
acceptable to the Committee.

(d) In the event that the disposition of stock acquired pursuant to the Plan is
not covered by a then current registration statement under the Securities Act,
and is not otherwise exempt from such registration, such Shares shall be
restricted against transfer to the extent required under the Securities Act, and
the Committee may require any individual receiving Shares pursuant to the Plan,
as a condition precedent to receipt of such Shares, to represent to the Company
in writing that such Shares are acquired for investment only and not with a view
to distribution and that such Shares will be disposed of only if registered for
sale under the Securities Act or if there is an available exemption for such
disposition.

(e) Notwithstanding any other provision of the Plan, the Company shall not be
required to take or permit any action under the Plan or any Award Agreement
which, in the good-faith determination of the Company, would result in a
material risk of a violation by the Company of Section 13(k) of the Exchange
Act.

 

20

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13. INTERPRETATION AND AMENDMENTS; OTHER RULES.

The Committee may make such rules and regulations and establish such procedures
for the administration of the Plan as it deems appropriate. Without limiting the
generality of the foregoing, the Committee may (i) determine the extent, if any,
to which Options, RSUs or Shares (whether or not Shares of Restricted Stock) or
Dividend Equivalent Rights shall be forfeited (whether or not such forfeiture is
expressly contemplated hereunder); (ii) interpret the Plan and the Award
Agreements hereunder, with such interpretations to be conclusive and binding on
all persons and otherwise accorded the maximum deference permitted by law,
provided that the Committee’s interpretation shall not be entitled to deference
on and after a Termination Event except to the extent that such interpretations
are made exclusively by members of the Committee who are individuals who served
as Committee members before the Termination Event; and (iii) take any other
actions and make any other determinations or decisions that it deems necessary
or appropriate in connection with the Plan or the administration or
interpretation thereof. In the event of any dispute or disagreement as to the
interpretation of the Plan or of any rule, regulation or procedure, or as to any
question, right or obligation arising from or related to the Plan, the decision
of the Committee, except as provided in clause (ii) of the foregoing sentence,
shall be final and binding upon all persons. Unless otherwise expressly provided
hereunder, the Committee, with respect to any grant, may exercise its discretion
hereunder at the time of the Award or thereafter. The Board may amend the Plan
as it shall deem advisable, except that no amendment may adversely affect a
Participant with respect to an Award previously granted without such
Participant’s written consent unless such amendments are required in order to
comply with applicable laws; provided, however, that the Plan may not be amended
without stockholder approval in any case in which amendment in the absence of
stockholder approval would cause the Plan to fail to comply with any applicable
legal requirement or applicable exchange or similar rule.

 

14. CHANGES IN CAPITAL STRUCTURE.

(a) If (i) the Company or Subsidiaries shall at any time be involved in a
merger, consolidation, dissolution, liquidation, reorganization, exchange of
shares, sale of all or substantially all of the assets or stock of the Company
or Subsidiaries or a transaction similar thereto, (ii) any stock dividend, stock
split, reverse stock split, stock combination, reclassification,
recapitalization or other similar change in the capital structure of the Company
or Subsidiaries, or any distribution to holders of Common Stock other than cash
dividends, shall occur or (iii) any other event shall occur which in the
judgment of the Committee necessitates action by way of adjusting the terms of
the outstanding Awards, then:

(x) the maximum aggregate number and kind of Shares which may be made subject to
Options and Dividend Equivalent Rights under the Plan, the maximum aggregate
number and kind of Shares of Restricted Stock that may be granted under the
Plan, the maximum aggregate number of RSUs and other Awards which may be granted
under the Plan may be appropriately adjusted by the Committee in its discretion;
and

 

21

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(y) the Committee may take any such action as in its discretion shall be
necessary to maintain each Participants’ rights hereunder (including under their
Award Agreements) so that they are substantially in their respective Options,
RSUs and Dividend Equivalent Rights substantially proportionate to the rights
existing in such Options, RSUs and Dividend Equivalent Rights prior to such
event, including, without limitation, adjustments in (A) the number of Options,
RSUs and Dividend Equivalent Rights (and other Awards under Section 9) granted,
(B) the number and kind of shares or other property to be distributed in respect
of Options, RSUs and Dividend Equivalent Rights (and other Awards under
Section 9 as applicable), (C) the Option Price and RSU Value, and
(D) performance-based criteria established in connection with Awards (to the
extent consistent with Section 162(m) of the Code, as applicable); provided
that, in the discretion of the Committee, the foregoing clause (D) may also be
applied in the case of any event relating to a Subsidiary if the event would
have been covered under this Section 14(a) had the event related to the Company.

To the extent that such action shall include an increase or decrease in the
number of Shares (or units of other property then available) subject to all
outstanding Awards, the number of Shares (or units) available under Section 4
shall be increased or decreased, as the case may be, proportionately, as may be
determined by the Committee in its discretion.

(b) Any Shares or other securities distributed to a Grantee with respect to
Restricted Stock or otherwise issued in substitution of Restricted Stock shall
be subject to the restrictions and requirements imposed by Section 6, including
depositing the certificates therefor with the Company together with a stock
power and bearing a legend as provided in Section 6.2(c).

(c) If the Company shall be consolidated or merged with another corporation or
other entity, each Grantee who has received Restricted Stock that is then
subject to restrictions imposed by Section 6.3 may be required to deposit with
the successor corporation the certificates, if any, for the stock or securities,
or the other property, that the Grantee is entitled to receive by reason of
ownership of Restricted Stock in a manner consistent with Section 6.2(c), and
such stock, securities or other property shall become subject to the
restrictions and requirements imposed by Section 6.3, and the certificates
therefor or other evidence thereof shall bear a legend similar in form and
substance to the legend set forth in Section 6.2(c).

(d) If a Termination Event shall occur, then the Committee, as constituted
immediately before the Termination Event, may make such adjustments as it, in
its discretion, determines are necessary or appropriate in light of the
Termination Event, provided that the Committee determines that such adjustments
do not have an adverse economic impact on the Participant as determined at the
time of the adjustments.

(e) The judgment of the Committee with respect to any matter referred to in this
Section 14 shall be conclusive and binding upon each Participant without the
need for any amendment to the Plan.

 

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(f) Other than as otherwise permitted under this Section 14, without the prior
approval of the Company’s stockholders: (i) the Option Price, with respect to an
Option, or grant price, with respect to a Stock Appreciation Right, may not be
reduced below the price established at the time of grant thereof and (ii) an
outstanding Option or Stock Appreciation Right may not be cancelled and replaced
with a new Award with a lower exercise or grant price.

 

15. MISCELLANEOUS.

 

  15.1 No Rights to Employment or Other Service.

Nothing in the Plan or in any grant made pursuant to the Plan shall confer on
any individual any right to continue in the employ or other service of the
Company, the Subsidiaries or Affiliates or interfere in any way with the right
of the Company, the Subsidiaries or Affiliates and their stockholders to
terminate the individual’s employment or other service at any time.

 

  15.2 Right of First Refusal; Right of Repurchase.

At the time of grant, the Committee may provide in connection with any grant
made under the Plan that Shares received hereunder shall be subject to a right
of first refusal pursuant to which the Company shall be entitled to purchase
such Shares in the event of a prospective sale of the Shares, subject to such
terms and conditions as the Committee may specify at the time of grant or (if
permitted by the Award Agreement) thereafter, and to a right of repurchase,
pursuant to which the Company shall be entitled to purchase such Shares at a
price determined by, or under a formula set by, the Committee at the time of
grant or (if permitted by the Award Agreement) thereafter.

 

  15.3 No Fiduciary Relationship.

Nothing contained in the Plan (including without limitation Sections 7.5(c) and
8.4), and no action taken pursuant to the provisions of the Plan, shall create
or shall be construed to create a trust of any kind, or a fiduciary relationship
between the Company or Subsidiaries, or their, officers or the Committee, on the
one hand, and the Participant, the Company, Subsidiaries or any other person or
entity, on the other.

 

  15.4 Section 409A.

This Plan is intended to comply and shall be administered in a manner that is
intended to comply with the requirement of Section 409A of the Code (including
the Treasury Department guidance and regulations issued thereunder), and shall
be construed and interpreted in accordance with such intent. If the Committee
determines that an Award, Award document, payment, transaction or any other
action or arrangement contemplated by the provisions of this Plan would, if
undertaken, cause a Participant to become subject to any additional taxes or
other penalties under Section 409A of the Code, then unless the Committee
specifically provides otherwise, such Award, Award document, payment,
transaction or other Award documents will be deemed modified or, if necessary,
suspended in order to comply with the requirements of Section 409A of the Code
to the extent determined appropriate by the Committee, in each case without the
consent of the Participant.

 

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  15.5 Claims Procedures.

(a) To the extent that the Plan is determined by the Committee to be subject to
the Employee Retirement Income Security Act of 1974, as amended, the Grantee, or
his beneficiary hereunder or authorized representative, may file a claim for
payments with respect to RSUs under the Plan by written communication to the
Committee or its designee. A claim is not considered filed until such
communication is actually received. Within 90 days (or, if special circumstances
require an extension of time for processing, 180 days, in which case notice of
such special circumstances should be provided within the initial 90-day period)
after the filing of the claim, the Committee will either:

(i) approve the claim and take appropriate steps for satisfaction of the claim;
or

(ii) if the claim is wholly or partially denied, advise the claimant of such
denial by furnishing to him a written notice of such denial setting forth
(A) the specific reason or reasons for the denial; (B) specific reference to
pertinent provisions of the Plan on which the denial is based and, if the denial
is based in whole or in part on any rule of construction or interpretation
adopted by the Committee, a reference to such rule, a copy of which shall be
provided to the claimant; (C) a description of any additional material or
information necessary for the claimant to perfect the claim and an explanation
of the reasons why such material or information is necessary; and (D) a
reference to this Section 15.5 as the provision setting forth the claims
procedure under the Plan.

(b) The claimant may request a review of any denial of such claim by written
application to the Committee within 60 days after receipt of the notice of
denial of such claim. Within 60 days (or, if special circumstances require an
extension of time for processing, 120 days, in which case notice of such special
circumstances should be provided within the initial 60-day period) after receipt
of written application for review, the Committee will provide the claimant with
its decision in writing, including, if the claimant’s claim is not approved,
specific reasons for the decision and specific references to the Plan provisions
on which the decision is based.

 

  15.6 No Fund Created.

Any and all payments hereunder to any Grantee shall be made from the general
funds of the Company, no special or separate fund shall be established or other
segregation of assets made to assure such payments, and the RSUs (including for
purposes of this Section 15.6 any accounts established to facilitate the
implementation of Section 7.4(c)) and any other similar devices issued hereunder
to account for Plan obligations do not constitute Common Stock and shall not be
treated as (or as giving rise to) property or as a trust fund of any kind;
provided, however, that the Company may establish a mere bookkeeping reserve to
meet its obligations hereunder or a trust or other funding vehicle that would
not cause the Plan to be deemed to be funded for tax purposes or for purposes of
Title I of the Employee Retirement Income Security Act of 1974, as amended. The
obligations of the Company under the Plan are unsecured and constitute a mere
promise by the Company to make benefit payments in the future and, to the extent
that any

 

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person acquires a right to receive payments under the Plan from the Company,
such right shall be no greater than the right of a general unsecured creditor of
the Company. (If any Affiliate is or is made responsible with respect to any
Awards, the foregoing sentence shall apply with respect to such Affiliate.)
Without limiting the foregoing, RSUs and any other similar devices issued
hereunder to account for Plan obligations are solely a device for the
measurement and determination of the amounts to be paid to a Grantee under the
Plan, and each Grantee’s right in the RSUs and any such other devices is limited
to the right to receive payment, if any, as may herein be provided.

 

  15.7 Notices.

All notices under the Plan shall be in writing, and if to the Company, shall be
delivered to the Board or mailed to its principal office, addressed to the
attention of the Board; and if to the Participant, shall be delivered
personally, sent by facsimile transmission or mailed to the Participant at the
address appearing in the records of the Company. Such addresses may be changed
at any time by written notice to the other party given in accordance with this
Section 15.7.

 

  15.8 Exculpation and Indemnification.

The Company shall indemnify and hold harmless the members of the Board and the
members of the Committee from and against any and all liabilities, costs and
expenses incurred by such persons as a result of any act or omission to act in
connection with the performance of such person’s duties, responsibilities and
obligations under the Plan, to the maximum extent permitted by law, other than
such liabilities, costs and expenses as may result from the gross negligence,
bad faith, willful misconduct or criminal acts of such persons.

 

  15.9 Captions.

The use of captions in this Plan is for convenience. The captions are not
intended to provide substantive rights.

 

  15.10 Governing Law.

THE PLAN SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF MARYLAND WITHOUT REGARD TO ANY PRINCIPLES OF CONFLICTS OF LAW WHICH
COULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE
OF MARYLAND.

 

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EXHIBIT A

PERFORMANCE CRITERIA

Performance-Based Awards intended to qualify as “performance based” compensation
under Section 162(m) of the Code, may be payable upon the attainment of
objective performance goals that are established by the Committee and relate to
one or more Performance Criteria, in each case on specified date or over any
period, up to 10 years, as determined by the Committee. Performance Criteria may
(but need not) be based on the achievement of the specified levels of
performance under one or more of the measures set out below relative to the
performance of one or more other corporations or indices.

Performance Goals shall be based on one or more of the following business
criteria (which may be determined for these purposes either by reference to the
Company as a whole or by reference to any one or more of its subsidiaries,
operating divisions or other operating units): stock price, revenues, pretax
income, operating income, cash flow, earnings per share, return on equity,
return on invested capital or assets, cost reductions and savings, return on
revenues, productivity, level of managed assets and near or long-term earnings
potential, or any variation or combination of the preceding business criteria.

The foregoing Performance Goals may be stated in absolute terms or may be
expressed relative to performance in a specified prior period or to the
performance of other specified enterprises. In addition, the Committee may
utilize as an additional performance measure (to the extent consistent with the
Performance-Based Compensation Rules (as defined below)) the attainment by a
Participant of one or more personal objectives and/or goals that the Committee
deems appropriate, including, but not limited to, implementation of Company
policies, negotiation of significant corporate transactions, development of
long-term business goals or strategic plans for the Company, or the exercise of
specific areas of managerial responsibility. “Performance-Based Compensation
Rules” shall mean those provisions of Section 162(m) of the Code and regulations
promulgated thereunder that provide the rules pursuant to which compensation
that is paid to executives on the basis of performance is exempt from the
limitations on deductibility applicable to certain compensation paid to
executives in excess of $1,000,000. The measurement of the Company’s or a
Participant’s achievement of any of such goals must be objectively determinable
and shall be determined, to the extent applicable, according to generally
accepted accounting principles as in existence on the date on which the
Performance Goals for the performance period is established. In all cases, the
Committee shall establish the Performance Goal for each performance period no
later than 90 days after the beginning of the performance period (or no later
than the end of the first 25% of the performance period if the performance
period is less than a full year), and shall establish such Performance Goals in
a manner that is consistent with the Performance-Based Compensation Rules. In
the event a Performance Goal is not established for a performance period for a
Participant for whom a Performance Goal was in effect for the preceding
performance period, the Performance Goal for such Participant for the preceding
performance period shall be treated as the Performance Goal for such Participant
for the current performance period. The use of a performance period that is less
than a full year shall not require any reduction to the limitations on maximum
permitted bonus payments under the Plan or require that less than a
Participant’s full annual base salary be taken into account in determining
bonuses payable or limits on payments. To the extent

 

26

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specified by the Committee in an Award or by other action taken by the Committee
at the time Performance Goals for a performance period are established, the
measurement of specified performance goals may be subject to adjustment to
exclude items of gain, loss or expense that are determined to be extraordinary
or unusual in nature, infrequent in occurrence, related to a corporate
transaction (including, without limitation, a disposition or acquisition) or
related to a change in accounting principles, all as determined in accordance
with standards published by the Financial Accounting Standards Board (or any
predecessor or successor body) from time to time. In addition, equitable
adjustments will be made to any performance goal related to Company stock (e.g.,
earnings per share) to reflect changes in corporate capitalization, including,
without limitation, stock splits and reorganizations.

 

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1.

 

DEFINITIONS

     1   

2.

 

EFFECTIVE DATE AND TERMINATION OF PLAN

     6   

3.

 

ADMINISTRATION OF PLAN

     6   

4.

 

SHARES AND UNITS SUBJECT TO THE PLAN

     7   

5.

 

PROVISIONS APPLICABLE TO STOCK OPTIONS

     8   

6.

 

PROVISIONS APPLICABLE TO RESTRICTED STOCK

     12   

7.

 

PROVISIONS APPLICABLE TO RESTRICTED STOCK UNITS

     14   

8.

 

PROVISIONS APPLICABLE TO DIVIDEND EQUIVALENT RIGHTS

     17   

9.

 

OTHER EQUITY-BASED AWARDS

     18   

10.

 

PERFORMANCE GOALS

     18   

11.

 

TAX WITHHOLDING

     18   

12.

 

REGULATIONS AND APPROVALS

     20   

13.

 

INTERPRETATION AND AMENDMENTS; OTHER RULES

     21   

14.

 

CHANGES IN CAPITAL STRUCTURE

     21   

15.

 

MISCELLANEOUS

     23   

EXHIBIT A

     26   

 

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