Exhibit 10.2


 


FIELDSTONE INVESTMENT CORPORATION EQUITY INCENTIVE PLAN


PERFORMANCE SHARE
AGREEMENT


 


Fieldstone Investment
Corporation (the “Company”), hereby grants performance shares relating to
shares of its common stock (the “Stock”), to the individual named below as the
Holder, subject to the terms and conditions set forth in this cover sheet, in
the attachment and in the Company’s Equity Incentive Plan (the “Plan”).


 


	
  Grant
  Date:

  	
  Name
  of Holder:

  



 


Performance Period:


 


Performance Goal


 


	
   

  	
   

  	
  Return on Equity for the

  Performance Period (ROE)

  	
   

  	
  Number of Performance

  Shares (*)

  	
   

  
	
  Minimum

  	
   

  	
  __

  	
  %

  	
   

  	
   

  
	
  Target

  	
   

  	
  __

  	
  %

  	
   

  	
   

  
	
  Maximum

  	
   

  	
  __

  	
  %

  	
   

  	
   

  



 










*No
Performance Shares will be earned if the minimum ROE is not attained.  The number of Performance Shares that may be
earned for ROE values between the Minimum and Target, and between the Target
and Maximum, will be determined by interpolation.  In no event may you earn more than the
Maximum number of Performance Shares. 
Performance Shares earned are at risk of forfeiture according to the
Time-Based Vesting Requirement.


 


Time-Based Vesting
Requirement (subject to your continued Service)


 


	
  Vesting Date

  	
   

  	
  Vesting Percentage Based on
  Continued Service

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


Dividend Equivalents.  Dividends
Equivalents will be earned once the minimum Performance Goal is met.  Dividends equivalents will
accrue, and will be paid when the Performance Shares become vested (subject to
applicable withholding taxes).  No
earnings or interest are paid on Dividend Equivalents.


 


By signing this cover
sheet, you agree to all of the terms and conditions described in the attached
Agreement and in the Plan, a copy of which is also attached.  You acknowledge that you have carefully
reviewed the Plan, and agree that the Plan will control in the event any
provision of this Agreement should appear to be inconsistent.


 


	
  Company:

  	
   

  	
   

  
	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
				



 


Attachment


 





















 


FIELDSTONE INVESTMENT CORPORATION EQUITY INCENTIVE PLAN


 


PERFORMANCE SHARE
AGREEMENT


 


	
  Performance Shares/
  Transferability

  	
   

  	
  This grant is an award of performance shares,
  subject to the vesting conditions described below (the “Performance Shares”).
  Your Performance Shares may not be transferred, assigned, pledged or
  hypothecated, whether by operation of law or otherwise, nor may the
  Performance Shares be made subject to execution, attachment or similar
  process.

  
	
   

  	
   

  	
   

  
	
  Number of Performance Shares

  	
   

  	
  The number of Performance Shares that you may earn is based on the
  Company’s achievement of the Performance Goals, as set forth on the cover
  sheet.  You will not be entitled to any
  Performance Shares unless the minimum Performance Goal for the Performance
  Period (as set forth on the cover sheet) is met or exceeded.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If, as a result of a material restatement of the Company’s financial
  results for all or a portion of the Performance Period that occurs after the
  close of the Performance Period but prior to March 31, 2009 (a “Restatement”),
  the Company’s ROE for the Performance Period (giving effect to the
  Restatement) differs from the Company’s ROE for the Performance Period
  without giving effect to the Restatement, then the number of Performance
  Shares that you may earn shall be determined based on the Company’s ROE
  giving effect to the Restatement.

  
	
   

  	
   

  	
   

  
	
  Vesting

  	
   

  	
  If the minimum Performance Goal is met, the number
  of Performance Shares indicated on the cover sheet for the level of
  Performance Goal achieved will be earned.  However, earned Performance Shares are
  subject to forfeiture if your Service terminates prior to vesting according
  to the Vesting Schedule set forth on the cover sheet.  No Performance Shares will vest after your
  Service has terminated for any reason.

  
	
   

  	
   

  	
   

  
	
  Delivery of Stock Pursuant to
  Vested Performance Shares

  	
   

  	
  A certificate for all of the shares of Stock
  represented by the earned and vested Performance Shares (which shares of
  Stock will be rounded down to the nearest number of whole shares) will be
  delivered to you on or immediately after you have vested in such Performance
  Shares provided, that, if vesting occurs during a period in which you are (i)
  subject to a lock-up agreement restricting your ability to sell shares of
  Stock in the open market or (ii) restricted from selling shares of Stock in
  the open market because you are not then eligible to sell under the Company’s
  insider trading or similar plan as

  



 


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  then in effect (whether because a trading window
  is not open or you are otherwise restricted from trading), delivery of such
  shares of Stock will be delayed until the first date on which you are no
  longer prohibited from selling shares of Stock due to a lock-up agreement or
  insider trading plan restriction, but in any event no later than 2 1⁄2 months
  after the end of the calendar year in which such Performance Shares vested.

  
	
   

  	
   

  	
   

  
	
  Dividends

  	
   

  	
  If the minimum Performance Goal is met, you will
  be entitled to a cash payment (the “Dividend Equivalent”) based on the amount
  of any cash dividends paid by the Company on the Stock after the Performance
  Goal has been met and prior to the vesting of the Performance Shares.  The Dividend Equivalent will be calculated
  as the product of: (a) the number of unvested Performance Shares (measured as
  of the ex-dividend date for the Stock) times (b) the per share cash dividend
  amount paid to holders of the Stock.  The
  Company will pay the Dividend Equivalents to you at the time you become
  vested in the Performance Shares, but only with regard to the number of
  Performance Shares that vest.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your right to receive Dividend Equivalents
  terminates upon your termination of Service for any reason.  Payment of Dividend Equivalents will be
  delayed six months if payment is made in connection with your separation from
  Service and such a delay is required to avoid the imposition of the excise
  tax under Code Section 409A.

  
	
   

  	
   

  	
   

  
	
  Forfeiture of Unvested
  Performance Shares

  	
   

  	
  In the event that your
  Service terminates for any reason other than: (i) your death, (ii) your
  Disability or (iii) your Involuntary Termination within one year following a
  Corporate Transaction, then you will forfeit all the Performance Shares that
  have not yet become vested.  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If your Service terminates because of your death,
  Disability, or Involuntary Termination within one year following a Corporate
  Transaction, then if the minimum Performance Goal has been met, you will be
  fully vested in the Performance Shares.  If the minimum Performance Goal has not yet
  been met, then you will forfeit all of the unvested Performance Shares upon a
  termination of your Service for any reason.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  For the purpose of this Agreement, “Involuntary
  Termination” means a termination of your Service by the Company without
  Cause.

  



 


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  Withholding Taxes

  	
   

  	
  You agree, as a condition of this grant, that you
  will make acceptable arrangements to pay any withholding or other taxes that
  may be due as a result of vesting in Performance Shares, payment of Dividend
  Equivalents or your acquisition of Stock under this grant.  In the event that the Company determines
  that any federal, state, local or foreign tax or withholding payment is
  required relating to this grant, the Company will have the right to: (i)
  require that you arrange such payments to the Company; (ii) withhold such
  amounts from other payments due to you from the Company or any Affiliate; or
  (iii) cause an immediate forfeiture of shares of Stock subject to the
  Performance Shares granted pursuant to this Agreement in an amount equal to
  the statutory minimum withholding or other taxes due.

  
	
   

  	
   

  	
   

  
	
  Retention Rights

  	
   

  	
  This Agreement does not give you the right to be
  retained by the Company (or any Affiliates) in any capacity.  The Company (and any Affiliate) reserve the right to terminate your Service at any time
  and for any reason.

  
	
   

  	
   

  	
   

  
	
  Shareholder Rights

  	
   

  	
  You do not have any of the rights of a shareholder
  with respect to the Performance Shares unless and until the Stock relating to
  the Performance Shares has been delivered to you.

  
	
   

  	
   

  	
   

  
	
  Adjustments

  	
   

  	
  In the event of a stock split, a stock dividend or
  a similar change in the Company stock, the number of Performance Shares
  covered by this grant will be adjusted (and rounded down to the nearest whole
  number) in accordance with the terms of the Plan.

  
	
   

  	
   

  	
   

  
	
  Applicable Law

  	
   

  	
  This Agreement will be interpreted and enforced
  under the laws of the State of Maryland, other than any conflicts or choice
  of law rule or principle that might otherwise refer construction or
  interpretation of this Agreement to the substantive law of another
  jurisdiction.

  
	
   

  	
   

  	
   

  
	
  Other Agreements

  	
   

  	
  You agree, as a condition of the grant of this Award, that you will
  execute such document(s) as necessary to become a party to any shareholder
  agreement or voting trust as the Company may require.

  
	
   

  	
   

  	
   

  
	
  Consent to Electronic Delivery

  	
   

  	
  The Company may choose to deliver certain statutory materials
  relating to the Plan in electronic form.  By accepting this option grant you agree
  that the Company may deliver the Plan prospectus and the Company’s annual
  report to you in an electronic format.  If at any time you would prefer to receive
  paper copies of these documents, as you are entitled to, the Company would be
  pleased to provide copies.  Please
  contact Secretary of the Company to request paper

  



 


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  copies of these documents.

  
	
   

  	
   

  	
   

  
	
  The Plan

  	
   

  	
  The text of the Plan is incorporated in this
  Agreement by reference.  This Agreement
  and the Plan constitute the entire understanding between you and the Company
  regarding this grant of Performance Shares.  Any prior agreements, commitments or
  negotiations concerning this grant are superseded.

  
	
   

  	
   

  	
   

  
	
  Stock
  Ownership Requirements

  	
   

  	
  Your right to
  the Performance Shares is subject to your compliance with the stock ownership
  requirement (“Stock Ownership Requirement”) set forth in this section of
  the Agreement.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  You are required
  to continue to hold sixty percent (60%) of the shares of Stock acquired
  pursuant to this Performance Share grant (such 60% to be determined after
  reducing the shares of Stock covered by this grant by the number shares of
  Stock equal in value to the amount required to be withheld to pay taxes in
  connection with this grant) until the number of shares of Stock owned by you
  equals or exceeds the Company’s stock ownership guidelines.  If the number of shares of Stock owned by
  you exceeds the Company’s stock ownership guidelines, you may dispose of the
  shares of Stock acquired pursuant to this Performance Share grant as long as
  you continue to own at least the required number of shares after the
  disposition.  The Stock Ownership
  Requirements shall lapse upon your termination of Service.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Company
  shall have the right to enforce the Stock Ownership Requirements contained in
  this Agreement through the use of an escrow arrangement.  In the event the Company uses an escrow, the
  certificates for the Performance Shares shall be deposited in escrow with the
  Secretary of the Company to be held in accordance with the this section of
  the Agreement.  The shares of Stock
  held in escrow shall be subject to the following terms and conditions
  relating to their release from escrow:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •           All
  shares shall be released upon your termination of Service.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •           Upon
  your written request, the shares (or a portion thereof) shall be released to
  you from the escrow upon presentation of evidence satisfactory to the Company
  that the disposition of such shares would not cause you to violate the Stock
  Ownership Requirements.

  



 


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By
signing the cover sheet of this Agreement, you agree to all of the terms and

conditions described above and in the Plan.


 


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