Exhibit 10.3

 

AMENDED AND RESTATED
INVESTMENT TECHNOLOGY GROUP, INC.
DIRECTORS’ RETAINER FEE SUBPLAN

 

SECTION 1.                            Introduction.

 

This Amended and Restated Investment Technology Group, Inc. Directors’ Retainer
Fee Subplan (the “Subplan”) was originally implemented by Investment Technology
Group, Inc. (the “Company”) under the Investment Technology Group, Inc. Amended
and Restated 1994 Stock Option and Long-term Incentive Plan and was merged with
and into the Investment Technology Group, Inc. 2007 Omnibus Equity Compensation
Plan (the “2007 Plan”) effective as of May 8, 2007, and is now amended and
restated as set forth herein, effective February 7, 2008 (the “Effective
Date”).  Effective as of May 8, 2007, the Subplan continued in effect according
to the terms set forth herein as a subplan under the 2007 Plan.  The purpose of
the Subplan is to provide non-employee directors with an election to receive
payment of their annual retainer fees in the form of shares of Company Stock or
cash or to defer payment of their annual retainer fees in the form of Deferred
Share Units.  The Subplan is intended to encourage qualified individuals to
accept nominations as directors of the Company and to strengthen the mutuality
of interest between the nonemployee directors and the Company’s other
stockholders.  The Subplan is amended and restated herein, effective for
deferrals made from annual retainer fees earned for periods on or after the
Effective Date.  Deferrals made from annual retainer fees earned prior to the
Effective Date shall be governed by the Subplan as in effect prior to this
amendment and restatement.

 

SECTION 2.                            Definitions.

 

Capitalized terms used in the Subplan but not defined herein shall have the same
meanings as defined in the 2007 Plan.  In addition to such terms and the terms
defined in Section 1 hereof, the following terms used in the Subplan shall have
the meaning set forth below.

 

(a)                                 “Deferred Share Unit” means a fully vested
Stock Unit entitling the holder to receive one share of Company Stock per Stock
Unit in accordance with the terms of the Subplan.

 

(b)                                 “Director” means a member of the Board who
is not, and has not been during the preceding three months, (i) an employee of
the Company or any parent or subsidiary of the Company or (ii) a consultant who
has received, during the preceding 12-month period, payments in excess of
$150,000 from the Company and its subsidiaries for consulting services.

 

(c)                                  “Subplan Benefits” means the benefits
described in Sections 5 and 6 hereof.

 

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SECTION 3.                            Administration.

 

The Subplan shall be administered by the Committee.  The Committee shall have
full authority to construe and interpret the Subplan, and any action of the
Committee with respect to the Subplan shall be final, conclusive, and binding on
all persons.

 

SECTION 4.                            Cash or Stock Election.

 

Each Director may elect to receive his or her annual retainer fee in the form of
cash or fully vested shares of Company Stock.  In addition, each Director may
elect to defer receipt of his or her annual retainer fee in the form of Deferred
Share Units as provided in Section 5 below.  If a Director elects to receive his
or her annual retainer fee in the form of vested shares of Company Stock, the
shares will be distributed on the date the annual retainer fee is otherwise
payable in accordance with the Company’s regular retainer fee payment practices,
and the amount of Company Stock distributed shall be the number of shares of
Company Stock having an aggregate Fair Market Value on the payment date equal to
the amount of the Director’s annual retainer fee that is otherwise payable on
that date.  Fractional shares will be rounded up to the nearest whole share.  A
Director’s election to receive his or her annual retainer fee in the form of
cash or vested shares of Company Stock shall continue in effect until the
Director notifies the Company in writing, in a manner consistent with Section 5
below, that the Director wishes to prospectively change his or her election.  If
a Director fails to make any election under the Subplan, the Director’s annual
retainer fee shall be paid in cash.

 

SECTION 5.                            Deferred Share Unit Accounts.

 

The Company shall maintain a Deferred Share Unit account (an “Account”) for each
Director who has elected to defer his or her annual retainer.  Deferred Share
Units will be credited to each such Account as follows:

 

(a)                                 Each Director may make an irrevocable
election on or before December 31 by written notice to the Company, to defer
payment of all of the compensation otherwise payable as his or her annual
retainer fee for service as a Director for the following calendar year. 
Notwithstanding the foregoing, a Director may make such an election within 30
days after first becoming eligible to participate in the Subplan, with respect
to compensation payable after the effective date of the election.  All
compensation which a Director elects to defer pursuant to this
Section 5(a) shall be credited in the form of Deferred Share Units to the
Director’s Account.  The number of Deferred Share Units so credited will be
equal to the number of shares of Company Stock having an aggregate Fair Market
Value (on the date the compensation would otherwise have been paid) equal to the
amount by which the Director’s compensation was reduced pursuant to the deferral
election.  Deferrals of compensation hereunder shall continue until the Director
notifies the Company in writing that the Director wishes his or her compensation
for the following calendar year, and succeeding periods to be paid on a current
basis either in the form of cash or Company Stock.

 

(b)                                 As of each date on which a cash dividend is
paid on Company Stock:

 

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(i)             there shall be credited to each Account that number of Deferred
Share Units (including fractional units) determined by (i) multiplying the
amount of such dividend (per share) by the number of Deferred Share Units
credited to such Account prior to May 19, 2015; and (ii) dividing the total so
determined by the Fair Market Value of a share of Company Stock on the date of
payment of such cash dividend.  The additions to a Director’s Account pursuant
to this Section 5(b) shall continue until the Director’s Subplan Benefit is
fully paid in accordance with Section 6 below.

 

(ii)          a Director shall receive a cash amount determined by multiplying
the amount of such dividend (per share) by the number of Deferred Share Units
credited to a Director’s Account on or after May 19, 2015.

 

SECTION 6.                            Subplan Benefits.

 

(a)                                 Form.  The Subplan Benefit of a Director
shall consist of shares of Company Stock equal in number to the Deferred Share
Units in the Director’s Account.  Any fractional Deferred Share Units shall be
rounded up to the nearest whole Deferred Share Unit.

 

(b)                                 Distribution.

 

(i)             The Subplan Benefit of a Director shall be distributed within 30
days after the date of termination of the Director’s service on the Board.

 

(ii)          In the case of the death of a Director, the Director’s Subplan
Benefit shall be distributed within 60 days after the date of the Director’s
death to the Director’s estate as beneficiary, unless the Director has requested
a different distribution by written notice to the Committee.

 

SECTION 7.                            General.

 

(a)                                 Nontransferabilily.  Except as provided in
Section 6(b)(ii), no payment of any Subplan Benefit of a Director shall be
anticipated, assigned, attached, garnished, optioned, transferred or made
subject to any creditor’s process, whether voluntarily or involuntarily or by
operation of law.  Any act in violation of this subsection shall be void.

 

(b)                                 Compliance with Legal and Trading
Requirements.  The Subplan shall be subject to all applicable laws, rules and
regulations, including, but not limited to, federal and state laws, rules and
regulations, and to such approvals by any regulatory or governmental agency as
may be required.

 

(c)                                  Amendment.  The Committee may amend, alter,
suspend, discontinue, or terminate the Subplan without the consent of
stockholders of the Company or individual Directors, except that any such action
will be subject to the approval of the Company’s

 

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stockholders at the next annual meeting of the stockholders having a record date
after the date such action was taken if such stockholder approval is required by
any federal or state law or regulation or the rules of any automated quotation
system or securities exchange on which the Company Stock may be quoted or
listed, or if the Committee determines in its discretion to seek such
stockholder approval; provided, however, that, without the consent of an
affected Director, no amendment, alteration, suspension, discontinuation, or
termination of the Subplan may impair or, in any other manner, adversely affect
the rights of such Director to accrued Subplan Benefits hereunder.

 

(d)                                 Unfunded Status of Awards.  The Subplan
(other than Section 4 hereof) is intended to constitute an “unfunded” plan of
deferred compensation.  With respect to any payments not yet made to a Director,
nothing contained in the Subplan shall give any such Director any rights that
are greater than those of a general creditor of the Company; provided, however,
that the Company may authorize the creation of trusts or make other arrangements
to meet the Company’s obligations under the Subplan to deliver cash, or other
property pursuant to any award, which trusts or other arrangements shall be
consistent with the “unfunded” status of the Subplan unless the Company
otherwise determines with the consent of each affected Director.

 

(e)                                  Nonexclusivity of the Subplan.  The
adoption of the Subplan shall not be construed as creating any limitations on
the power of the Board or the Committee to adopt such other compensation
arrangements as it may deem desirable, including, without limitation, the
granting of Options and other awards otherwise than under the Subplan, and such
arrangements may be either applicable generally or only in specific cases.

 

(f)                                   Adjustments.  The adjustment provisions in
Section 5(d) of the 2007 Plan are incorporated herein by reference and shall
apply in the case of Company Stock and Deferred Share Units granted hereunder.

 

(g)                                  No Right to Remain on the Board.  Neither
the Subplan nor the crediting of Deferred Share Units under the Subplan shall be
deemed to give any individual a right to remain a director of the Company or
create any obligation on the part of the Board to nominate any Director for
reelection by the stockholders of the Company.

 

(h)                                 Section 409A .  It is intended that this
Subplan and awards issued hereunder will comply with Section 409A of the Code
(and any regulations and guidelines issued thereunder) to the extent the awards
are subject thereto, and this Subplan and such awards shall be interpreted on a
basis consistent with such intent.  All payments to be made upon a termination
of service under this Subplan may only be made upon a “separation from service”
under Section 409A of the Code.  In no event shall a Director, directly or
indirectly, designate the calendar year of payment.  This Subplan and any award
agreements issued thereunder may be amended in any respect deemed by the
Committee to be necessary in order to preserve compliance with Section 409A of
the Code.

 

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(i)                                     Governing Law.  The validity,
construction, and effect of the Subplan shall be determined in accordance with
the laws of the State of Delaware without giving effect to principles of
conflict of laws.

 

(j)                                    Titles and Headings.  The titles and
headings of the Sections in the Subplan are for convenience of reference only. 
In the event of any conflict, the text of the Subplan, rather than such titles
or headings, shall control.

 

(k)                                 Effective Date.  This Subplan, as amended
and restated herein shall become effective as of the Effective Date.

 

Amended and restated by the Committee effective:

 

May 8, 2007

Amended and restated by the Committee effective:

 

February 7, 2008

Amended and restated by the Committee effective:

 

May 19, 2015

 

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