exv10w13



 





Exhibit 10.13




PIPER JAFFRAY COMPANIES

SUMMARY OF NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAM



Directors who are not Piper Jaffray employees receive an annual cash retainer of $50,000 for
service on our Board of Directors and the committees of the Board. No separate meeting fees are
paid. The lead director and the chairperson of the Audit Committee each receives an additional
annual cash retainer of $8,000. The chairperson of each other standing committee of the Board each
receives an additional annual cash retainer of $5,000.



In addition to the cash retainer, we also grant equity awards to our non-employee directors in
order to further align their interests with those of our shareholders. Starting in 2007, each
non-employee director will receive a grant of 500 shares of our common stock on the date of the
director’s initial election to the Board, granted under our Amended and Restated 2003 Annual and
Long-Term Incentive Plan. Non-employee directors who will continue their service on the Board
following an annual meeting of shareholders will receive a grant of 1,000 shares of our common
stock on the date of the annual meeting. Non-employee directors who join our Board after the first
month of a calendar year are paid pro rata annual retainers and awarded pro rata equity awards
based on the period during which they serve as directors during the year.



Prior to 2007, each non-employee director received a grant of stock options with a fair market
value of $20,000 on the date of the director’s initial election to the Board, and non-employee
directors who were continuing their service on the Board following an annual meeting of
shareholders received a grant of stock options valued at $50,000 on the date of the annual meeting.
The number of shares underlying the grant of stock options was determined using the Black-Scholes
option-pricing model, and the options were exercisable immediately, have a 10-year term and have an
exercise price equal to the closing price of our common stock on the date of grant. The options
were granted under our Amended and Restated 2003 Annual and Long-Term Incentive Plan.



Our non-employee directors may participate in the Piper Jaffray Companies Deferred Compensation
Plan for Non-Employee Directors, which was designed to facilitate increased equity ownership in the
company by our non-employee directors. The plan permits our non-employee directors to defer all or
a portion of the cash fees payable to them for their service as a
director of Piper Jaffray for any calendar year. Any cash amounts deferred by a
participating director are credited to a recordkeeping account established for the director and
deemed invested in shares of our common stock as of the date the deferred fees otherwise would have
been paid to the director. This deemed investment is measured in phantom stock, and no shares of
common stock are reserved, repurchased or issued pursuant to the plan. The fair market value of
all phantom stock credited to a director’s account will be paid out to the director (or, in the
event of the director’s death, to his or her beneficiary) in a single lump-sum cash payment
following the director’s cessation of service as a non-employee director. The amount paid out will
be determined based on the fair market value of the stock on the last day of the year in which the
director’s service with us terminates. Directors who elect to participate in the plan are not
required to pay income taxes on amounts deferred but will instead pay income taxes on the amount of
the lump-sum cash payment paid to the director (or beneficiary) at the time of such payment. Our
obligations under the plan are unsecured general obligations to pay in the future the value of the
participant’s account pursuant to the terms of the plan.




 









 







Non-employee directors also may participate in our charitable gift matching program, pursuant to
which we will match an employee’s or director’s gifts to eligible organizations dollar for dollar
from a minimum of $50 up to an aggregate maximum of $1,500 per year. In addition, our non-employee
directors are reimbursed for reasonable out-of-pocket expenses incurred in connection with their
service on the Board and committees of the Board. Employees of Piper Jaffray who also serve as
directors receive compensation for their services as employees, but they do not receive any
additional compensation for their service as directors. No other compensation is paid to our Board
members in their capacity as directors. Non-employee directors do not participate in our employee
benefit plans.