Exhibit 10.9

 

WESTERN ASSET MORTGAGE CAPITAL CORPORATION

MANAGER EQUITY PLAN

 

RESTRICTED STOCK AWARD AGREEMENT

 

THIS RESTRICTED STOCK AWARD AGREEMENT, (the “Agreement”), dated as of May 15,
2012 (the “Grant Date”), is made by and between Western Asset Mortgage Capital
Corporation, a Delaware corporation (the “Company”), and Western Asset
Management Company, a California corporation (the “Grantee”).

 

WHEREAS, the Company has adopted the Western Asset Mortgage Capital Corporation
Manager Equity Plan (the “Plan”), pursuant to which the Company may grant to the
Grantee shares of Stock which are restricted as to transfer (shares so
restricted hereinafter referred to as “Restricted Stock”);

 

WHEREAS, the Grantee is providing bona fide services to the Company on the date
of this Agreement;

 

WHEREAS, the Company desires to grant to the Grantee the number of shares of
Restricted Stock provided for herein;

 

NOW, THEREFORE, in consideration of the recitals and the mutual agreements
herein contained, the parties hereto agree as follows:

 

Section 1.                                Grant of Restricted Stock Award

 

(a)                               Grant of Restricted Stock.  The Company hereby
grants to the Grantee 51,159 shares of Restricted Stock on the terms and
conditions set forth in this Agreement and as otherwise provided in the Plan.

 

(b)                              Incorporation of Plan.  The provisions of the
Plan are hereby incorporated herein by reference.  Except as otherwise expressly
set forth herein, this Agreement shall be construed in accordance with the
provisions of the Plan and any capitalized terms not otherwise defined in this
Agreement shall have the definitions set forth in the Plan.  The Board shall
have final authority to interpret and construe the Plan and this Agreement and
to make any and all determinations thereunder, and its decision shall be binding
and conclusive upon the Grantee and its representatives in respect of any
questions arising under the Plan or this Agreement.

 

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Section 2.                                Terms and Conditions of Award

 

The grant of Restricted Stock provided in Section 1(a) shall be subject to the
following terms, conditions and restrictions:

 

(a)                               Ownership of Shares.  Subject to the
restrictions set forth in the Plan and this Agreement, the Grantee shall possess
all incidents of ownership of the Restricted Stock granted hereunder, including
the right to receive dividends and distributions with respect to such Stock, as
set forth in clause (b) below, and the right to vote such Stock.

 

(b)                              Payment of Dividends and Distributions.  The
Grantee shall be entitled to receive dividends and distributions which become
payable on the Restricted Stock at the time such dividends and distributions are
paid to other holders of Stock.  Stock or other property distributed in
connection with such a dividend or distribution shall be subject to restrictions
and a risk of forfeiture to the same extent as such Restricted Stock.

 

(c)                               Restrictions.  Restricted Stock and any
interest therein, may not be sold, assigned, transferred, pledged, hypothecated
or otherwise disposed of prior to the lapse of restrictions set forth in this
Agreement applicable thereto, as set forth in Section 2(e).  The Board may in
its discretion, cancel all or any portion of any outstanding restrictions prior
to the expiration of the periods provided under Section 2(e).

 

(d)                             Certificate; Restrictive Legend.  The Grantee
agrees that any certificate issued for Restricted Stock prior to the lapse of
any outstanding restrictions relating thereto shall be inscribed with the
following legend:

 

This certificate and the shares of stock represented hereby are subject to the
terms and conditions, including forfeiture provisions and restrictions against
transfer (the “Restrictions”), contained in the Western Asset Mortgage Capital
Corporation Manager Equity Plan and an agreement entered into between the
registered owner and Western Asset Mortgage Capital Corporation.  Any attempt to
dispose of these shares in contravention of the Restrictions, including by way
of sale, assignment, transfer, pledge, hypothecation or otherwise, shall be null
and void and without effect.

 

(e)                               Lapse of Restrictions; Forfeiture.  Except as
may otherwise be provided herein, the restrictions on transfer set forth in
Section 2(c) shall lapse with respect to 33.33% of the shares of Restricted
Stock granted hereunder on the first anniversary of the Grant Date, 33.33% of
the shares of Restricted Stock granted hereunder on the second anniversary of
the Grant Date and 33.34% of the shares of Restricted Stock granted hereunder on
the third anniversary of the

 

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Grant Date, subject to the Grantee’s continuing to provide services to the
Company as of such vesting date.

 

The effect of the termination of the Management Agreement shall be determined in
accordance with Section 7 of the Plan.

 

Upon each lapse of restrictions relating to Restricted Stock, the Company shall
issue to the Grantee a stock certificate representing a number of shares of
Stock, free of the restrictive legend described in Section 2(d), equal to the
number of shares subject to this Restricted Stock award with respect to which
such restrictions have lapsed.  If certificates representing such Restricted
Stock shall have theretofore been delivered to the Grantee, such certificates
shall be returned to the Company, complete with any necessary signatures or
instruments of transfer prior to the issuance by the Company of such unlegended
shares of Stock.

 

Restricted Stock and any unvested dividends or distributions with respect to
Restricted Stock forfeited pursuant to this Section 2(e) shall be transferred
to, and reacquired by, the Company without payment of any consideration by the
Company, and neither the Grantee nor any of the Grantee’s successors or assigns
shall thereafter have any further rights or interests in such shares,
certificates, dividends and distributions.  If certificates containing
restrictive legends shall have theretofore been delivered to the Grantee, such
certificates shall be returned to the Company, complete with any necessary
signatures or instruments of transfer.

 

Section 3.                                Miscellaneous

 

(a)                               Notices.  Any and all notices, designations,
consents, offers, acceptances and any other communications provided for herein
shall be given in writing and shall be delivered either personally or by
registered or certified mail, postage prepaid, which shall be addressed, in the
case of the Company to the [Corporate Counsel of the Company] at the principal
office of the Company and, in the case of the Grantee, to Corporate Counsel of
the Grantee.

 

(b)                              No Right to Continued Service.  Nothing in the
Plan or in this Agreement shall confer upon the Grantee any right to continue in
the service of the Company or shall interfere with or restrict in any way the
right of the Company, which is hereby expressly reserved, to terminate the
Management Agreement at any time for any reason whatsoever, with or without
“cause” (as defined in the Management Agreement).

 

(c)                               Bound by Plan.  By signing this Agreement, the
Grantee acknowledges that its authorized representative has received a copy of
the Plan and has had an opportunity to review the Plan and has agreed to bind
the Grantee with respect to all the terms and provisions of the Plan.

 

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(d)                             Successors.  The terms of this Agreement shall
be binding upon and inure to the benefit of the Company, its successors and
assigns, and of the Grantee and its successors and assigns.

 

(e)                               Invalid Provision.  The invalidity or
unenforceability of any particular provision thereof shall not affect the other
provisions hereof, and this Agreement shall be construed in all respects as if
such invalid or unenforceable provision had been omitted.

 

(f)                                Modifications.  No change, modification or
waiver of any provision of this Agreement shall be valid unless the same be in
writing and signed by the parties hereto.

 

(g)                              Entire Agreement.  This Agreement and the Plan
contain the entire agreement and understanding of the parties hereto with
respect to the subject matter contained herein and therein and supersede all
prior communications, representations and negotiations in respect thereto.

 

(h)                              Governing Law.  This Agreement and the rights
of the Grantee hereunder shall be construed and determined in accordance with
the laws of the State of Delaware.

 

(i)                                  Headings.  The headings of the Sections
hereof are provided for convenience only and are not to serve as a basis for
interpretation or construction, and shall not constitute a part, of this
Agreement.

 

(j)                                  Counterparts.  This Agreement may be
executed in counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

 

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IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the 15th day of May, 2012.

 

 

WESTERN ASSET MORTGAGE CAPITAL CORPORATION

 

 

 

 

 

By:

/s/ Travis Carr

 

 

Its:

COO

 

 

 

 

WESTERN ASSET MANAGEMENT COMPANY

 

 

 

 

 

By:

/s/ W. Stephen Venable, Jr.

 

 

Its:

Authorized Signatory

 

 

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