Exhibit 10.4


 


INVESTMENT TECHNOLOGY GROUP, INC.

STOCK UNIT GRANT AGREEMENT 

FOR NON-EMPLOYEE DIRECTORS


 


THIS GRANT AGREEMENT, dated as of                 
(the “Date of Grant”), is entered into by and between Investment Technology
Group, Inc. (the “Company”), a Delaware corporation, and                          ,
a member of the Board of Directors of the Company (the “Director”).


 


WHEREAS, the Director has been awarded the following Grant under the Amended
and Restated Investment Technology Group, Inc. Directors’ Equity Subplan (the “Subplan”),
a subplan of the Investment Technology Group, Inc. 2007 Omnibus Equity Compensation
Plan (the “2007 Plan”); 


 


WHEREAS, capitalized terms used herein and not defined herein shall
have the meanings set forth in the Subplan and in the 2007 Plan. In the event
of any conflict between this Grant Agreement, the Subplan and the 2007 Plan,
the Subplan and the 2007 Plan shall control; and


 


WHEREAS, the Director is not employed by the Company, a Subsidiary of
the Company or a parent of the Company and is not otherwise ineligible to
participate in the Subplan.


 


NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and for other good and valuable consideration, the parties
hereto agree as follows:


 


1.   Grant
of Stock Units.  Subject to the terms and conditions set forth in
this Grant Agreement, the Subplan and the 2007
Plan, the Director is hereby awarded       
Stock Units that represent hypothetical shares
of Company Stock on a one-for-one basis (the “Stock Unit Grant”).


 


2.   Grant Subject to Plan Provisions. This Stock Unit Grant is granted pursuant to the Subplan
and the 2007 Plan, the terms of which are incorporated herein by reference, and
in all respects shall be interpreted in accordance with the Subplan and the
2007 Plan. This Stock Unit Grant is subject to interpretations, regulations and
determinations concerning the Subplan and the 2007 Plan established from time
to time by the Committee in accordance with the provisions of the Subplan and
the 2007 Plan, including, but not limited to, provisions pertaining to (a) the
registration, qualification or listing of the shares issued under the 2007 Plan,
(b) changes in capitalization, (c) requirements of applicable law and (d) all other
provisions of the Subplan and the 2007 Plan. The Committee has the authority to
interpret and construe this Grant Agreement pursuant to the terms of the Subplan
and the 2007 Plan, and its decisions are conclusive as to any questions arising
hereunder.


 

















 


3.   Stock
Unit Account. The Company shall establish and maintain a Stock Unit bookkeeping
account (the “Account”) on its records for the Director and shall record
in the Account the number of Stock Units awarded to the Director. No shares of
stock shall be issued to the Director at the time the Stock Unit Grant is made.


 


4.   Vesting
of the Stock Unit Grant.


 


(a)   Subject to the terms and conditions of this Grant Agreement, the Subplan
and the 2007 Plan, this Stock Unit Grant shall become vested and
the restrictions on the Stock Unit Grant shall lapse in three approximately equal
annual installments, beginning on the first anniversary of the Date of Grant if
the Director is serving as a Non-Employee Director, or is deemed to be serving
as a Non-Employee Director in accordance with Section 5 below, as of each
applicable vesting date; provided, however, that the Stock Unit
Grant shall become immediately vested in full (i) immediately prior to the
effectiveness of a Change in Control if the Director is serving as a
Non-Employee Director, or is deemed to be serving as a Non-Employee Director in
accordance with Section 5 below, as of such date or (ii) in the event that the
Director ceases to serve as a Non-Employee Director due to the Director’s death
or Disability (as defined below). In the event the Director ceases to serve as
a Non-Employee Director for any other reason not described or provided for
herein, any portion of the Stock Unit Grant that has not yet vested shall be
forfeited.


 


“Disability” shall have
the meaning ascribed to such term in Section 22(e)(3) of the Code.


 


(b)  The
lapse of restrictions on the Stock Unit Grant shall be cumulative, but shall
not exceed 100% of the Stock Unit Grant. If the foregoing vesting schedule
would produce fractional Stock Units, the number of Stock Units on which the
restrictions lapse shall be rounded down to the nearest whole Stock Unit.


 


(c)   Unless
otherwise provided by the Committee, all amounts receivable in connection with
any adjustments to the Company Stock under Section 5(d) of the 2007 Plan, as
incorporated within the Subplan, shall be subject to the vesting schedule in
this Section 4.


 


5.   Continued
Service as an Employee. If the Director ceases to serve as a Non-Employee
Director and, immediately thereafter, the Director is employed by the Employer,
then, solely for the purposes of Sections 4 and 6 herein, the Director shall
not be deemed to have ceased to serve as a Non-Employee Director at that time,
and his or her continued employment by the Employer shall be deemed to be
continued service as a Non-Employee Director. If the Director becomes employed
by the Employer, the distribution of shares as described in Section 6 below
shall be subject to applicable federal (including FICA), state and local tax
withholding requirements pursuant to Section 14 of the 2007 Plan. 


 


6.   Distribution
of Shares. The Company shall distribute to the Director (or the Director’s
heirs in the event of the Director’s death) at the time of vesting of the Stock
Unit Grant in accordance with Section 4 above (but not later than March 15 of
the calendar year following the calendar year in which the Stock Units vest), a
number of shares of Company Stock equal to the number of Stock Units then held
by the Director that became vested at such time (subject to any applicable tax
withholding under Section 5 above); provided, however, that, 


 


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if the Director so elected in
accordance with the terms of the Subplan and the 2007 Plan, distribution of the
shares of Company Stock subject to the Stock Unit Grant shall be deferred until
the time the Director ceases to be a Non-Employee Director for any reason
(except as otherwise provided in Section 5 above), in accordance with the terms
of the Subplan and the 2007 Plan.


 


7.   Rights
and Restrictions. The Stock Unit Grant shall not be transferable, other
than by will or under the laws of descent and distribution (or pursuant to a
beneficiary designation authorized by the Committee). Prior to vesting of the Stock
Unit Grant and delivery of the shares of Company Stock to the Director, the
Director shall not have any rights or privileges of a stockholder as to the
shares of Company Stock subject to the Stock Unit Grant. Specifically, the
Director shall not have the right to receive dividends or the right to vote
such shares of Company Stock, nor shall the Director have the right to sell,
assign, pledge, hypothecate, encumber, transfer or otherwise dispose of, in
whole or in part, the Stock Unit Grant, prior to vesting of the Stock Unit
Grant and delivery of the shares of Company Stock. The Director shall not have
any interest in any fund or specific assets of the Company by reason of this Stock
Unit Grant or the Account established for the Director.


 


8.   Limitations.
Nothing herein shall limit the Company's right to issue Company Stock, or Stock
Units or other rights to purchase Company Stock subject to vesting, expiration
and other terms and conditions deemed appropriate by the Company and its
affiliates. Nothing expressed or implied herein is intended or shall be
construed to confer upon or give to any Person, other than the parties hereto,
any right, remedy or claim under or by reason of this Grant Agreement or of any
term, covenant or condition hereof.


 


9.   Expenses
of Issuance of Company Stock. The issuance of stock certificates hereunder
shall be without charge to the Director. The Company shall pay, and indemnify
the Director from and against any issuance, stamp or documentary taxes (other
than transfer taxes) or charges imposed by any governmental body, agency or
official (other than income taxes) by reason of the issuance of Company Stock.


 


10. Terms
are Binding. The terms of this Grant Agreement shall be binding upon the
executors, administrators, heirs, successors, transferees and assignees of the Director
and the Company.


 


11. Compliance
with Law. The transfer of Company Stock hereunder shall be subject to the
terms, conditions and restrictions as set forth in the governing instruments of
the Company, Company policies, applicable federal and state securities laws or
any other applicable laws or regulations, and approvals by any governmental or
regulatory agency as may be required. By signing this Grant Agreement, the
Director agrees not to sell any Company Stock at a time when applicable laws or
the Company policies prohibit a sale.


 


12. References.  References
herein to rights and obligations of the Director shall apply, where
appropriate, to the Director’s legal representative or estate without regard to
whether specific reference to such legal representative or estate is contained
in a particular provision of this Grant Agreement.


 


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13. Notices.  Any
notice required or permitted to be given under this Grant Agreement shall be in
writing and shall be deemed to have been given when delivered personally or by
courier, or sent by certified or registered mail, postage prepaid, return
receipt requested, duly addressed to the party concerned at the address
indicated below or to such changed address as such party may subsequently, by
similar process, give notice of:


 


If to the
Company:


 


Investment
Technology Group, Inc.

380 Madison Avenue

New York, NY 10017

Attention: General Counsel


 


If to the
Director:


 


At the
Director’s most recent address shown on the Company’s corporate records, or at
any other address at which the Director may specify in a notice delivered to
the Company in the manner set forth herein.


 


14. Section
409A. It is intended that the Stock Unit Grant issued hereunder shall comply
with Section 409A of the Code (and any regulations and guidelines issued
thereunder) to the extent the Stock Unit Grant is subject thereto, and the Stock
Unit Grant shall be interpreted on a basis consistent with such intent. This Grant
Agreement may be amended without the consent of the Director in any respect
deemed by the Committee to be necessary in order to preserve compliance with
Section 409A of the Code.


 


15. Costs.
In any action at law or in equity to enforce any of the provisions or rights under
this Grant Agreement, including any arbitration proceedings to enforce such
provisions or rights, the unsuccessful party to such litigation or arbitration,
as determined by the court in a final judgment or decree, or by the panel of
arbitrators in its award, shall pay the successful party or parties all costs,
expenses and reasonable attorneys' fees incurred by the successful party or
parties (including without limitation costs, expenses and fees on any appeals),
and if the successful party recovers judgment in any such action or proceeding
such costs, expenses and attorneys' fees shall be included as part of the
judgment. 


 


16. Further
Assurances. The Director agrees to perform all acts and execute and deliver
any documents that may be reasonably necessary to carry out the provisions of
this Grant Agreement, including but not limited to all acts and documents
related to compliance with federal and/or state securities laws.


 


17. Counterparts.
For convenience, this Grant Agreement may be executed in any number of
identical counterparts, each of which shall be deemed a complete original in
itself and may be introduced in evidence or used for any other purposes without
the production of any other counterparts.


 


18. Governing
Law. This Grant Agreement shall be construed and enforced in accordance
with Section 6(h) of the Subplan.


 


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19. Entire
Agreement. This Grant Agreement, together with the Subplan and the 2007
Plan, sets forth the entire agreement between the parties with reference to the
subject matter hereof, and there are no agreements, understandings, warranties,
or representations, written, express, or implied, between them with respect to
the Stock Unit Grant other than as set forth herein or therein, all prior
agreements, promises, representations and understandings relative thereto being
herein merged.


 


20. Amendment;
Waiver. This Grant Agreement may be amended, modified, superseded,
canceled, renewed or extended and the terms or covenants hereof may be waived
only by a written instrument executed by the parties hereto or, in the case of
a waiver, by the party waiving compliance. Any such written instrument must be
approved by the Committee to be effective as against the Company. The failure
of any party at any time or times to require performance of any provision
hereof shall in no manner affect the right at a later time to enforce the same.
No waiver by any party of the breach of any term or provision contained in this
Grant Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such breach, or a waiver of the breach of any other term or covenant contained
in this Grant Agreement.


 


21. Severability.
Any provision of this Grant Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.


 


[SIGNATURE PAGE FOLLOWS]


 


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IN WITNESS WHEREOF, the undersigned have executed this Grant Agreement
as of the date first above written.


 


	
   

  	
  INVESTMENT TECHNOLOGY GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name: Robert C. Gasser

  
	
   

  	
  Title: CEO and President

  



 


 


I hereby
accept the Stock Unit Grant described in this Grant Agreement, and I agree to
be bound by the terms of the Subplan, the 2007 Plan and this Grant Agreement. I
hereby acknowledge that a copy of the Plan and the Plan prospectus have been
delivered to me. I hereby further agree that all the decisions and
determinations of the Committee shall be final and binding.


 


 


	
   

  	
   

  	
   

  
	
   

  	
      [Insert Name of the
  Director]

  



 


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