exv10w9





EXHIBIT 10.9




STARWOOD PROPERTY TRUST, INC.




EQUITY PLAN





 


 









 







STARWOOD PROPERTY TRUST INC.


EQUITY PLAN




	 	 	 	 	 	 	 
	Section	 	 	Page	 
	 	 	 
	 	 	 	 
	1.	 	Purpose; Types of Awards
	 	 	1	 
	 	 	 
	 	 	 	 
	2.	 	Definitions
	 	 	1	 
	 	 	 
	 	 	 	 
	3.	 	Administration
	 	 	3	 
	 	 	 
	 	 	 	 
	4.	 	Eligibility
	 	 	4	 
	 	 	 
	 	 	 	 
	5.	 	Stock Subject to the Plan
	 	 	4	 
	 	 	 
	 	 	 	 
	6.	 	Terms of Awards
	 	 	5	 
	 	 	 
	 	 	 	 
	7.	 	Termination of Service
	 	 	10	 
	 	 	 
	 	 	 	 
	8.	 	Change in Control
	 	 	10	 
	 	 	 
	 	 	 	 
	9.	 	General Provisions
	 	 	10	 







 


 









 







STARWOOD PROPERTY TRUST INC.




EQUITY PLAN





1.
Purpose; Types of Awards.



The purposes of the Starwood Property Trust Inc. Equity Plan (the “Plan”) are to afford an
incentive to the directors and officers, advisors and consultants of Starwood Property Trust Inc.
(the “Company”) who are in any case natural persons and providing services to the Company,
including without limitation individuals who are employees of the Manager or one of its Affiliates
who are providing services to the Company, to continue as directors, officers, advisors and
consultants, to increase their efforts on behalf of the Company and to promote the success of the
Company’s business. The Plan provides for the grant of stock options, stock appreciation rights,
restricted stock, restricted stock units and other equity-based awards.




2.
Definitions.




For purposes of the Plan, the following terms shall be defined as set forth below:



(a) “Affiliate” means (i) any Person directly or indirectly controlling, controlled by, or
under common control with such other Person, (ii) any executive officer or general partner of such
other Person and (iii) any legal entity for which such Person acts as an executive officer or
general partner.



(b) “Award” means any Option, Stock Appreciation Right, Restricted Stock, Restricted Stock
Unit or Other Stock-Based Award granted under the Plan.



(c) “Award Agreement” means any written agreement, contract or other instrument or document
evidencing an Award.



(d) “Board” means the Board of Directors of the Company.



(e) “Change of Control” means a change in ownership or effective control of the Company, or a
change in the ownership of a substantial portion of the assets of the Company, in any case, within
the meaning of Section 409A of the Code; provided, however, that a transaction or series of
transactions effected with the Manager and/or any Affiliate of the Manager, through the acquisition
of Stock or other Company securities (regardless of the form of such transaction or series of
transactions), changes to the membership of the Board or otherwise, shall not constitute a Change
of Control for purposes of the Plan or any Award.



(f) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the
rules and regulations promulgated thereunder.


 


 









 





(g) “Committee” means the committee established by the Board to administer the Plan, the
composition of which shall at all times consist of “non-employee directors” within the meaning of
Rule 16b-3 under the Exchange Act.



(h) “Company” means Starwood Property Trust Inc., a Maryland corporation, or any successor
corporation.



(i) “Effective Date” means August 11, 2009, the date on which the Plan was adopted by the
Board, subject to obtaining the approval of the Company’s stockholders.



(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time,
and the rules and regulations promulgated thereunder.



(k) “Fair Market Value” means, with respect to Stock or other property, the fair market value
of such Stock or other property determined by such methods or procedures as shall be established
from time to time by the Board. Unless otherwise determined by the Board in good faith, the per
share Fair Market Value of Stock as of a particular date shall mean (i) the closing sales price per
share of Stock on the national securities exchange on which the Stock is principally traded, for
the last preceding date on which there was a sale of such Stock on such exchange; (ii) if the
shares of Stock are then traded in an over-the-counter market, the average of the closing bid and
asked prices for the shares of Stock in such over-the-counter market for the last preceding date on
which there was a sale of such Stock in such market; or (iii) if the shares of Stock are not then
listed on a national securities exchange or traded in an over-the-counter market, such value as the
Board, in its sole discretion, shall determine.



(l) “Management Agreement” means the Management Agreement, to be dated as of August 17, 2009,
by and between the Company and the Manager, as such may be amended from time to time.



(m) “Manager” means SPT Management, LLC, a Delaware limited liability company.



(n) “Option” means a right, granted to a Participant under Section 6(b)(i), to purchase shares
of Stock.



(o) “Other Stock-Based Award” means a right or other interest granted to a Participant that
may be denominated or payable in, valued in whole or in part by reference to, or otherwise based
on, or related to, Stock, including but not limited to unrestricted shares of Stock or dividend
equivalent rights.



(p) “Participant” means an eligible person who has been granted an Award under the Plan.



(q) “Person” means any natural person, corporation, partnership, association, limited
liability company, estate, trust, joint venture, any federal,
state or municipal government or any bureau, department or agency thereof or any other legal
entity and any fiduciary acting in such capacity on behalf of the foregoing.


 


2









 





(r) “Plan” means this Starwood Property Trust Inc. Equity Plan, as amended from time to time.



(s) “Restricted Stock” means an Award of shares of Stock to a Participant under Section
6(b)(iii) that may be subject to certain restrictions and to a risk of forfeiture.



(t) “Restricted Stock Unit” or “RSU” means a right granted to a Participant under Section
6(b)(iv) to receive Stock, cash or other property at the end of a specified period, which right may
be conditioned on the satisfaction of specified performance or other criteria.



(u) “Securities Act” means the Securities Act of 1933, as amended from time to time, and the
rules and regulations promulgated thereunder.



(v) “Separation from Service” shall have the meaning attributed to such term under Section
409A of the Code.



(w) “Stock” means shares of the common stock, par value $0.01 per share, of the Company.



(x) “Stock Appreciation Right” or “SAR” means the right granted to a Participant under Section
6(b)(ii) to be paid an amount measured by the appreciation in the Fair Market Value of Stock from
the date of grant to the date of exercise of the right.




3.
Administration.



The Plan shall be administered by the Board. Except with respect to the amendment,
modification, suspension or early termination of the Plan, the Board may appoint a Committee to
administer all or a portion of the Plan. To the extent that the Board so delegates its authority,
references herein to the Board shall be deemed references to the Committee. The Board may delegate
to one or more agents such administrative duties as it may deem advisable, and the Committee or any
other person to whom the Board has delegated duties as aforesaid may employ one or more persons to
render advice with respect to any responsibility the Board or such Committee or person may have
under the Plan. No member of the Board or Committee shall be liable for any action taken or
determination made in good faith with respect to the Plan or any Award granted hereunder.


 


3









 





The Board shall have the authority in its discretion, subject to and not inconsistent with the
express provisions of the Plan, to administer the Plan and to exercise all the powers and
authorities either specifically granted to it under the Plan or necessary or advisable in the
administration of the Plan, including, without limitation, the authority to: (i) grant Awards;
(ii) determine the persons to whom and the time or times
at which Awards shall be granted; (iii) determine the type and number of Awards to be granted,
the number of shares of Stock to which an Award may relate and the terms, conditions, restrictions
and performance criteria relating to any Award; (iv) determine whether, to what extent, and under
what circumstances an Award may be settled, cancelled, forfeited, exchanged, or surrendered; (v)
make adjustments in the terms and conditions of Awards; (vi) construe and interpret the Plan and
any Award; (vii) prescribe, amend and rescind rules and regulations relating to the Plan; (viii)
determine the terms and provisions of the Award Agreements (which need not be identical for each
Participant); and (ix) make all other determinations deemed necessary or advisable for the
administration of the Plan. All decisions, determinations and interpretations of the Board shall
be final and binding on all persons, including but not limited to the Company, any parent or
subsidiary of the Company, any Participant (or any person claiming any rights under the Plan from
or through any Participant) and any stockholder. Notwithstanding any provision of the Plan or any
Award Agreement to the contrary, except as provided in the second paragraph of Section 5, neither
the Board nor the Committee may take any action which would have the effect of reducing the
aggregate exercise, base or purchase price of any Award without obtaining the approval of the
Company’s stockholders.




4.
Eligibility.



Awards may be granted, in the discretion of the Board, to individuals who are, as of the date
of grant, directors or officers, advisors or consultants of the Company, who in any case are
natural persons and providing services to the Company, including without limitation individuals who
are employees of the Manager or one of its Affiliates. In determining the persons to whom Awards
shall be granted and the type of any Award (including the number of shares to be covered by such
Award), the Board shall take into account such factors as the Board shall deem relevant in
connection with accomplishing the purposes of the Plan.




5.
Stock Subject to the Plan.



The maximum number of shares of Stock reserved for the grant of Awards under the Plan shall be
equal to 3,112,500, less any shares of common stock issued or subject to awards granted under the
Company’s Manager Equity Plan, subject to adjustment as provided herein. During the term of the
Plan, no more than an aggregate 50,000 shares of Stock, subject to adjustment as provided herein,
may be made subject to Awards granted to the Company’s chief financial officer and/or chief
compliance officer. Stock issued under the Plan may, in whole or in part, be authorized but
unissued shares or shares that shall have been or may be reacquired by the Company in the open
market, in private transactions or otherwise. If any vested Award granted under the Plan is paid
or otherwise settled without the issuance of shares of Stock, or if shares of Stock are surrendered
to or withheld by the Company as payment of either the exercise price of an Award and/or
withholding taxes in respect of an Award, the shares of Stock that were subject to such Award shall
not again be available for Awards under the Plan. If any shares subject to an Award are forfeited,
cancelled, exchanged or surrendered or if an Award terminates or expires without a distribution of
shares to the Participant (other than as provided in the immediately preceding sentence), the
shares of Stock with respect to
such Award shall, to the extent of any such forfeiture, cancellation, exchange, surrender,
termination or expiration, again be available for Awards under the Plan. Upon the exercise of any
Award granted in tandem with any other Award, such related Award shall be cancelled to the extent
of the number of shares of Stock as to which the Award is exercised and, notwithstanding the
foregoing, such number of shares shall no longer be available for Awards under the Plan.


 


4









 





In the event that the Board shall determine that any dividend or other distribution (whether
in the form of cash, Stock, or other property), recapitalization, Stock split, reverse split,
reorganization, merger, consolidation, spin-off, combination, repurchase, or share exchange, or
other similar corporate transaction or event, affects the Stock such that an adjustment is
appropriate in order to prevent dilution or enlargement of the rights of Participants under the
Plan, then the Board shall make equitable changes or adjustments to any or all of: (i) the number
and kind of shares of Stock or other property (including cash) that may thereafter be issued in
connection with Awards; (ii) the number and kind of shares of Stock or other property (including
cash) issued or issuable in respect of outstanding Awards; (iii) the exercise price, base price or
purchase price relating to any Award and (iv) the performance goals, if any, applicable to
outstanding Awards. In addition, the Board may determine that any such equitable adjustment may be
accomplished by making a payment to the Award holder, in the form of cash or other property
(including but not limited to shares of Stock).




6.
Terms of Awards.



(a) General. The term of each Award shall be for such period as may be determined by the
Board. Subject to the terms of the Plan and any applicable Award Agreement, payments to be made by
the Company upon the grant, vesting, maturation or exercise of an Award may be made in such forms
as the Board shall determine at the date of grant or thereafter, including, without limitation,
cash, Stock or other property, and may be made in a single payment or transfer, in installments or
on a deferred basis. The Board may make rules relating to installment or deferred payments with
respect to Awards, including the rate of interest to be credited with respect to such payments. In
addition to the foregoing, the Board may impose on any Award or the exercise thereof, at the date
of grant or thereafter, such additional terms and conditions, not inconsistent with the provisions
of the Plan, as the Board shall determine.



(b) Terms
of Specified Awards. The Board is authorized to grant the Awards described in this
Section 6(b), under such terms and conditions as deemed by the Board to be consistent with the
purposes of the Plan. Such Awards may be granted with vesting, value and/or and payment contingent
upon attainment of one or more performance goals. Except as otherwise set forth herein or as may
be determined by the Board, each Award granted under the Plan shall be evidenced by an Award
Agreement containing such terms and conditions applicable to such Award as the Board shall
determine at the date of grant or thereafter.




(i) Options. The Board is authorized to grant Options to Participants on the
following terms and conditions:


 


5









 






(A) Exercise
Price. The exercise price per share of Stock
purchasable under an Option shall be determined by the Board, but in no
event shall the per share exercise price of any Option be less than 100%
of the Fair Market Value of a share of Stock on the date of grant of such
Option. The exercise price for Stock subject to an Option may be paid in
cash or by an exchange of Stock previously owned by the Participant,
through a “broker cashless exercise” procedure approved by the Board (to
the extent permitted by law) or a combination of the above, in any case in
an amount having a combined value equal to such exercise price; provided
that the Board may require that any Stock exchanged by the Participant
have been owned by the Participant for at least six months as of the date
of exercise. An Award Agreement may provide that a Participant may pay
all or a portion of the aggregate exercise price by having shares of Stock
with a Fair Market Value on the date of exercise equal to the aggregate
exercise price withheld by the Company.




(B) Term and Exercisability of Options. The date on which the Board
adopts a resolution expressly granting an Option shall be considered the
day on which such Option is granted. Options shall be exercisable over
the exercise period (which shall not exceed ten years from the date of
grant), at such times and upon such conditions as the Board may determine,
as reflected in the Award Agreement; provided, that the Board shall have
the authority to accelerate the exercisability of any outstanding Option
at such time and under such circumstances as it, in its sole discretion,
deems appropriate. An Option may be exercised to the extent of any or all
full shares of Stock as to which the Option has become exercisable, by
giving written notice of such exercise to the Board or its designated
agent.




(C) Termination of Service. Subject to Section 7, an Option may not
be exercised unless (1) the Participant is then providing services to the
Company and (2) the Participant has continuously maintained such
relationship since the date of grant of the Option; provided, that the
Award Agreement may contain provisions extending the exercisability of
Options, in the event of specified terminations of service, to a date not
later than the expiration date of such Option.




(D) Other Provisions. Options may be subject to such other
conditions including, but not limited to, restrictions on transferability
of the shares acquired upon exercise of such Options, as the Board may
prescribe in its discretion or as may be required by applicable law.


 


6









 






(ii) Stock Appreciation Rights. The Board is authorized to grant SARs to
Participants on the following terms and conditions:




(A) In General. Unless the Board determines otherwise, an SAR
granted in tandem with an Option may be granted at the time of grant of
the related Option or at any time thereafter. An SAR granted in tandem
with an Option shall be exercisable only to the extent the underlying
Option is exercisable. Payment of an SAR may made in cash, Stock, or
property as specified in the Award or determined by the Board.




(B) Right Conferred. An SAR shall confer on the Participant a right
to receive an amount with respect to each share subject thereto, upon
exercise thereof, equal to the excess of (1) the Fair Market Value of one
share of Stock on the date of exercise over (2) the base price of the SAR
(which in the case of an SAR granted in tandem with an Option shall be
equal to the exercise price of the underlying Option, and which in the
case of any other SAR shall be such price as the Board may determine,
provided it is no less than 100% of the Fair Market Value of a share of
Stock on the date of grant of such SAR).




(C) Term and Exercisability of SARs. The date on which the Board
adopts a resolution expressly granting an SAR shall be considered the day
on which such SAR is granted. SARs shall be exercisable over the exercise
period (which shall not exceed the lesser of ten years from the date of
grant or, in the case of a tandem SAR, the expiration of its related
Award), at such times and upon such conditions as the Board may determine,
as reflected in the Award Agreement; provided, that the Board shall have
the authority to accelerate the exercisability of any outstanding SAR at
such time and under such circumstances as it, in its sole discretion,
deems appropriate. An SAR may be exercised to the extent of any or all
full shares of Stock as to which the SAR (or, in the case of a tandem SAR,
its related Award) has become exercisable, by giving written notice of
such exercise to the Board or its designated agent.




(D) Termination of Service. Subject to Section 7, an SAR may not be
exercised unless (1) the Participant is then providing services to the
Company and (2) the Participant has continuously maintained such
relationship since the date of grant of the SAR; provided, that the Award
Agreement may contain provisions extending the exercisability of SARs, in
the event of specified terminations of service, to a date not later than
the expiration date of such SARs (or, in the case of a tandem SAR, its
related Award).


 


7









 






(E) Other Provisions. SARs may be subject to such other conditions
including, but not limited to, restrictions on transferability of the
 shares acquired upon exercise of such SARs, as the Board may prescribe in
its discretion or as may be required by applicable law.




(iii) Restricted Stock. The Board is authorized to grant Restricted Stock to
Participants on the following terms and conditions:




(A) Issuance and Restrictions. Restricted Stock shall be subject to
such restrictions on transferability and other restrictions, if any, as
the Board may impose at the date of grant or thereafter, which
restrictions may lapse separately or in combination at such times, under
such circumstances, in such installments, or otherwise, as the Board may
determine. The Board may place restrictions on Restricted Stock that
shall lapse, in whole or in part, only upon the attainment of one or more
performance goals. Unless otherwise determined by the Board, a
Participant granted Restricted Stock shall have all of the rights of a
stockholder including, without limitation, the right to vote Restricted
Stock and the right to receive dividends thereon.




(B) Forfeiture. Subject to Section 8, upon termination of service to
the Company during the applicable restriction period, Restricted Stock and
any accrued but unpaid dividends that are then subject to restrictions
shall be forfeited; provided, that the Board may provide, by rule or
regulation or in any Award Agreement, or may determine in any individual
case, that restrictions or forfeiture conditions relating to Restricted
Stock will be waived in whole or in part in the event of terminations
resulting from specified causes, and the Board may in other cases waive in
whole or in part the forfeiture of Restricted Stock.




(C) Certificates for Stock. Restricted Stock granted under the Plan
may be evidenced in such manner as the Board shall determine. If
certificates representing Restricted Stock are registered in the name of
the Participant, such certificates shall bear an appropriate legend
referring to the terms, conditions and restrictions applicable to such
Restricted Stock, and the Company shall retain physical possession of the
certificate.




(D) Dividends/Distributions. Unless otherwise determined by the
Board, dividends paid on Restricted Stock shall be paid at the dividend or
distribution payment date, provided that such payments may be deferred to
such date as determined by the Board, and in any event shall be payable in
cash or in shares of Stock having a Fair Market Value equal to the amount
of such
dividends and distributions. Unless otherwise determined by the
Board, Stock distributed in connection with a stock split or stock
dividend, and other property distributed as a dividend or distribution,
shall be subject to restrictions and a risk of forfeiture to the same
extent as the Restricted Stock with respect to which such Stock or other
property has been distributed.


 


8









 






(iv) Restricted Stock Units. The Board is authorized to grant RSUs to
Participants, subject to the following terms and conditions:




(A) Award and Restrictions. Delivery of Stock, cash or other
property, as determined by the Board, will occur upon expiration of the
period specified for RSUs by the Board during which forfeiture conditions
apply, or such later date as the Board shall determine. The Board may
place restrictions on RSUs that shall lapse, in whole or in part, only
upon the attainment of one or more performance goals.




(B) Forfeiture. Subject to Section 8, upon termination of service to
the Company prior to the vesting of RSUs, or upon failure to satisfy any
other conditions precedent to the delivery of Stock or cash to which such
RSUs relate, all RSUs and any accrued but unpaid dividend equivalents that
are then subject to deferral or restriction shall be forfeited; provided,
that the Board may provide, by rule or regulation or in any Award
Agreement, or may determine in any individual case, that restrictions or
forfeiture conditions relating to RSUs will be waived in whole or in part
in the event of termination resulting from specified causes, and the Board
may in other cases waive in whole or in part the forfeiture of RSUs.




(C) Dividend/Distribution Equivalents. The Board is authorized to
grant to Participants the right to receive dividend equivalent payments
and/or distribution equivalent payments for the period prior to settlement
of the RSU. Dividend equivalents or distribution equivalents may be paid
currently or credited to an account for the Participant, and may be
settled in cash or Stock, as determined by the Board. Any such
settlements, and any such crediting of dividend equivalents or
distribution equivalents or reinvestment in Stock, may be subject to such
conditions, restrictions and contingencies as the Board shall establish,
including the reinvestment of such credited amounts in Stock equivalents.
Unless otherwise determined by the Board, any such dividend equivalents or
distribution equivalents shall be paid or credited, as applicable, on the
dividend payment date to the Participant as though each RSU held by such
Participant were a share of outstanding Stock.


 


9









 






(v) Other Stock-Based Awards. The Board is authorized to grant Awards to
Participants in the form of Other Stock-Based Awards, as deemed by the Board to be
consistent with the purposes of the Plan. Awards granted pursuant to this
paragraph may be granted with vesting, value and/or payment contingent upon the
attainment of one or more performance goals. The Board shall determine the terms
and conditions of such Awards at the date of grant or thereafter. Without limiting
the generality of this paragraph, Other Stock-Based Awards may include grants of
 shares of Stock that are not subject to any restrictions or a substantial risk of
forfeiture.



7. Termination of Service. Unless otherwise determined by the Board, all unvested Awards then
held by a Participant who ceases to provide services to the Company, whether through a Separation
from Service or because of reassignment by such Participant’s employer, shall be immediately
cancelled and forfeited without consideration. The terms of Award Agreements shall set forth the
terms under which an Option or Stock Appreciation Right may remain exercisable following such a
termination of service with the Company.



8. Change in Control. In the event of a Change in Control, any Award that was not previously
vested will become fully vested and/or payable, and any performance conditions imposed with respect
to the Award will be deemed to be fully achieved; provided, however, that for any Award subject to
Section 409A of the Code, no payment may be made to the holder of such Award unless the transaction
constituting a Change in Control also constitutes, within the meaning of Section 409A of the Code,
a “change in the ownership or effective control” of the Company or a “change in the ownership of a
substantial portion of the assets” of the Company.




9. General Provisions.



(a) Nontransferability. Unless otherwise provided in an Award Agreement, Awards shall not be
transferable by a Participant except by will or the laws of descent and distribution and shall be
exercisable during the lifetime of a Participant only by such Participant or his guardian or legal
representative.



(b) No Right to Continued Service, etc. Nothing in the Plan or in any Award, any Award
Agreement or other agreement entered into pursuant hereto shall confer upon any Participant the
right to continue as a director of, or continue to provide services to, the Company or any parent,
subsidiary or Affiliate of the Company or the Manager or to be entitled to any remuneration or
benefits not set forth in the Plan or such Award Agreement or other agreement or to interfere with
or limit in any way the right of the Company to terminate such Participant’s service.


 


10









 





(c) Taxes. The Company or any parent or subsidiary of the Company is authorized to withhold
from any Award granted, any payment relating to an Award under the Plan, including from a
distribution of Stock, or any other payment to a Participant, amounts of withholding and other
taxes due in connection with any
transaction involving an Award, and to take such other action as the Board may deem advisable
to enable the Company and Participants to satisfy obligations for the payment of withholding taxes
and other tax obligations relating to any Award. This authority shall include authority to
withhold or receive Stock or other property and to make cash payments in respect thereof in
satisfaction of a Participant’s tax obligations. The Board may provide in the Award Agreement that
in the event that a Participant is required to pay any amount to be withheld in connection with the
issuance of shares of Stock in settlement or exercise of an Award, the Participant may satisfy such
obligation (in whole or in part) by electing to have the Company withhold a portion of the shares
of Stock to be received upon settlement or exercise of such Award that is equal to the minimum
amount required to be withheld.



(d) Effective Date; Amendment and Termination.




(i) The Plan shall take effect upon the Effective Date, subject to the
approval of the Company’s stockholders.




(ii) The Board may at any time and from time to time terminate, amend, modify
or suspend the Plan in whole or in part; provided, however, that unless otherwise
determined by the Board, an amendment that requires stockholder approval in order
for the Plan to comply with any law, regulation or stock exchange requirement shall
not be effective unless approved by the requisite vote of stockholders. The Board
may at any time and from time to time amend any outstanding Award in whole or in
part. Notwithstanding the foregoing sentence of this clause (ii), no amendment or
modification to or suspension or termination of the Plan or amendment of any Award
shall affect adversely any of the rights of any Participant, without such
Participant’s consent, under any Award theretofore granted under the Plan.



(e) Expiration of Plan. Unless earlier terminated by the Board pursuant to the provisions of
the Plan, the Plan shall expire on the tenth anniversary of the Effective Date. No Awards shall be
granted under the Plan after such expiration date. The expiration of the Plan shall not affect
adversely any of the rights of any Participant, without such Participant’s consent, under any Award
theretofore granted.



(f) Deferrals. The Board shall have the authority to establish such procedures and programs
that it deems appropriate to provide Participants with the ability to defer receipt of cash, Stock
or other property payable with respect to Awards granted under the Plan.



(g) No Rights to Awards; No Stockholder Rights. No Participant shall have any claim to be
granted any Award under the Plan. There is no obligation for uniformity of treatment among
Participants. Except as provided specifically herein, a Participant or a transferee of an Award
shall have no rights as a stockholder with respect to any shares covered by the Award until the
date of the issuance of a stock certificate to him for such shares.


 


11









 





(h) Unfunded Status of Awards. The Plan is intended to constitute an “unfunded” plan for
incentive and deferred compensation. With respect to any payments not yet made to a Participant
pursuant to an Award, nothing contained in the Plan or any Award shall give any such Participant
any rights that are greater than those of a general creditor of the Company.



(i) No Fractional Shares. No fractional shares of Stock shall be issued or delivered pursuant
to the Plan or any Award. The Board shall determine whether cash, other Awards or other property
shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.



(j) Regulations and Other Approvals.




(i) The obligation of the Company to sell or deliver Stock with respect to any
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 Board.




(ii) Each Award is subject to the requirement that, if at any time the Board
determines, in its absolute discretion, that the listing, registration or
qualification of Stock 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 grant of an Award or the issuance of Stock, no such Award
shall be granted or payment made or Stock issued, in whole or in part, unless
listing, registration, qualification, consent or approval has been effected or
obtained free of any conditions not acceptable to the Board.




(iii) 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 Stock shall be restricted
against transfer to the extent required by the Securities Act or regulations
thereunder, and the Board may require a Participant receiving Stock pursuant to the
Plan, as a condition precedent to receipt of such Stock, to represent to the
Company in writing that the Stock acquired by such Participant is acquired for
investment only and not with a view to distribution.




(iv) The Board may require a Participant receiving Stock pursuant to the Plan,
as a condition precedent to receipt of such Stock, to enter into a stockholder
agreement or “lock-up” agreement in such form as the Board shall determine is
necessary or desirable to further the Company’s interests.


 


12









 





(k) Registration on Form S-8. The Company shall file with the Securities and Exchange
Commission a registration statement on Form S-8 with respect to the securities to be offered to
Participants under the Plan and shall during the term of the Plan keep such registration statement
effective.



(l) Governing Law. The Plan and all determinations made and actions taken pursuant hereto
shall be governed by the laws of Maryland without giving effect to the conflict of laws principles
thereof.



(m) Section 409A. It is intended that the payments and benefits under the Plan comply with,
or as applicable, constitute a short-term deferral or otherwise be exempt from, the provisions of
Section 409A of the Code. The Plan will be administered and interpreted in a manner consistent
with this intent, and any provision that would cause the Plan or any Award to fail to satisfy
Section 409A of the Code will have no force and effect until amended to comply therewith (which
amendment may be retroactive to the extent permitted by Section 409A of the Code). To the extent
required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the
Code, amounts that would otherwise be payable and benefits that would otherwise be provided
pursuant to this Plan during the six-month period immediately following Participant’s termination
of employment shall instead be paid on the first business day after the date that is six months
following Participant’s termination of employment (or upon Participant’s s death, if earlier).




 


13