Untitled Document




Exhibit 10.9 



MFA
MORTGAGE INVESTMENTS, INC.
2004 EQUITY COMPENSATION PLAN 



Form of
Non-Qualified Stock Option Award Agreement 


AGREEMENT by
and between MFA Mortgage Investments, Inc., a Maryland corporation (the “Company”),
and ________________ (the “Optionee”), dated as of the _______ day of
_________, __________ (the “Effective Date”).
 


WHEREAS, the
Company maintains the 2004 Equity Compensation Plan (the “Plan”)
(capitalized terms used but not otherwise defined herein shall have the respective
meanings ascribed thereto by the Plan);
 


          WHEREAS,
the Optionee is a _________ of a  Participating Company; and
 


WHEREAS,  in
accordance  with the  Plan,  the  Committee  has  determined  that it is in the best
interests  of the  Company  and its  stockholders  to grant stock  options  and/or DERS
to  the  Optionee  subject to the terms and  conditions  set forth  below.
 


          NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
 


          1.
  Grant of Stock Option.

   


The Company
hereby grants the Optionee options (the “Options”) to purchase
________ shares of Common Stock, subject to the following terms and conditions and
subject to the provisions of the Plan relating to Options (including Section 15
thereof). The Plan is hereby incorporated herein by reference as though set forth
herein in its entirety.
 


The  Options
is  not  intended  to  be,  and  shall  not  be  qualified as, an “incentive  stock
options” under Section 422  of the Code.
 


          2.
  Option Price.

   


          The
Option Exercise Price per Share shall be  $________.
 


          3.
  Initial Exercisability.

   


Subject  to
paragraph  5 below,  the  Options,  to the extent  that  there  has  been  no
Termination  of  Service  and  the  Options have not otherwise  expired or been
forfeited,  shall  first  become  exercisable  (unless  sooner  exercisable  in
accordance with Section 15 of the Plan) as follows:
 



	
	For the Period Ending
	
	Percent of Total 

            Options First
  Exercisable
	 








          4.
  Exercisability Upon and After Termination of Optionee.

   





	(a) 	 	 If
upon any  Termination  of Service for any  reason  other  than  death,  Retirement  or
Disability,  the  Optionee  shall  have  the  right,  subject  to  the  provisions  of
the  Plan,  to  exercise  the Options at any time  within three  months after such
Termination  of  Service,  but only to the  extent  that,  at the date of Termination  of
Service,  the  Optionee’s  right to  exercise  the  Options  had  accrued  pursuant
to the terms of this  Agreement  and  had  not  previously  been  exercised;  provided,
however, that, unless  otherwise  provided  in this  Agreement,  if  there  occurs a
Termination  of  Service by  the  Company for
Cause or a  Termination  of  Service  by  the  Optionee  (other  than  on  account  of
death,  Retirement  or  Disability),  any Options not  exercised  in  full  prior  to
such  termination  shall  be  canceled.
 





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	(b) 	 	 If
the  Optionee  dies  while  an  Eligible  Person  or  within  three  months  after any
Termination  of  Service  other  than  for  Cause or a  Termination  of  Service  by the
Optionee  (other  than on  account of death,  Retirement  or  Disability),  and  has  not
fully  exercised  the  Options,  then  the  Options may be  exercised  in full,  subject
to the  provisions  of the Plan, at any time  within  12  months  after  the  Optionee’s
death,  by the  Successor  of the  Optionee,  but  only to the  extent  that,  at the
date  of death,  the Optionee’s  right to exercise  the  Options  had  accrued  and
had not been  forfeited  pursuant  to the  terms  of  this  Agreement  and  had  not
previously  been  exercised.
 






	(c) 	 	 Upon
Termination  of Service  for reason of  Disability  or  Retirement,  the  Optionee  shall
have  the  right,  subject  to  the  provisions  of the  Plan,  to  exercise  the  Option
at any time  within  24 months  after  such  Termination  of  Service,  but only to  the
extent  that,  at  the  date  of  Termination  of  Service,  the  Optionee’s  right
to  exercise  the  Options had accrued  pursuant  to the  terms  of  this  Agreement  and
had not previously been exercised.
 






	(d) 	 	 No
Options  which  had  not  become  exercisable  at the  time  of  cessation  of
employment  shall  ever  be  or  become  exercisable  (except as may be  provided  in
accordance  with  Section  15 of the  Plan).  No  provision  of  this  paragraph  4  is
intended  to or shall  permit  the  exercise  of the  Options to the  extent  the
Options  was  not  exercisable  upon  cessation  of  employment (except as may be so
provided).
 







          5.
  Term.

   


Unless  earlier
expired  or  forfeited,  the  Options  shall,  notwithstanding  any  other  provision  of
this  Agreement,  expire  in its  entirety  upon the  tenth  anniversary  of the  date
hereof.  The Option  shall also expire and be  forfeited  at  such  times  and  in  such
circumstances  as  otherwise  provided hereunder or under the Plan.
 


          6.
  Dividend Equivalent Rights.

   


Subject to
Section 11 of the Plan,  ________  DERs are granted  to the  Optionee,  consisting of the
right to receive cash per  DER in an amount equal to the dividend  distributions  paid on
a Share  subject  to an Option,  but only to the  extent  that  the  underlying  Options
to which such DERs are  subject  are  exercisable  in accordance  with the Plan and this
Agreement,  but  have  not yet been  exercised,  and  have not  previously  expired  or
been  forfeited.  Notwithstanding  the  other  provisions  of Section 11 of the Plan,
each payment under the  DERs shall be made as soon as  practicable  (but not more than
60 days)  after the time at which the  corresponding  dividend  distribution  is  made
to  stockholders  of  the  Company;  provided,  however,  that,  if  the  Committee
permits  the  Optionee  to elect to defer  the  Optionee’s  receipt  of such
payments,  the  Optionee  may elect  such a  deferral  on such  terms and  conditions as
may be  prescribed by the  Committee,  and using such forms as the  Committee  may
provide,  for this  purpose.  Notwithstanding  the  foregoing,  if a  distribution  to
stockholders  is  made  and  the  extent  to  which  such  distribution  constitutes  a
dividend  is  not  known  at the  time,  (i) the  Committee  may (but  need not)  direct
that a  payment  be  made in  respect  of the  Optionee’s  DERs as the  Committee
deems  appropriate,  and (ii) as soon as practicable  (but not more  than 60 days)  after
the  extent  to which the  distribution  constitutes  a dividend has been  determined  by
the  Company  in its  discretion  (A) in the  case  of a prior  underpayment  (or if no
prior  payments  had been  made),  the  Company shall make any payments  (without
interest) as may be  required to reflect  such  determination,  and (B) in the case  of
a  prior  overpayment,  the  Optionee  shall  make  any  repayment  (without  interest)
required  to  reflect  such  determination.
 


          7.
  Miscellaneous.

   


	(a) 	 	 THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND, WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS. The captions of this Agreement are
not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified except by a written agreement executed
by the parties hereto or their respective successors and legal representatives.
The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this Agreement.
 





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	(b) 	 	 The
Committee  shall  have  the  power  to  construe and interpret this  Agreement,  and  to
establish,  amend and  revoke  rules and  regulations  for  administration  of  the
Plan.  In  this  connection,  the  Committee  may  correct  any  defect  or  supply  any
omission,  or  reconcile  any  inconsistency  in the Plan,  in this  Agreement,  or in
any  related  agreements,  in the  manner  and to  the  extent  it  shall  deem
necessary  or  expedient  to  make  the  Plan  fully  effective.  All  decisions  and
determinations  by  the  Committee  in  the  exercise  of this  power  shall be final and
binding  upon  the  Company  and  the  Optionee.  Notwithstanding  the  foregoing,  the
Committee  shall not take any action or  make  any  interpretation  with  respect  to
this  Agreement  or  the  Plan  that  would  cause  (a) the  Plan or the  Options  to not
satisfy  the  requirements  for  exemption  under Rule 16b-3 under the  Exchange  Act or
(b)  any  member  of  the  Committee  to  be  disqualified  as  a  Non-Employee  Director
under such Rule.
 






	(c) 	 	 All
notices  hereunder  shall be in writing  and,  if to the  Company  or the  Committee,
shall be  delivered  to the  Board or mailed  to its  principal  office,  addressed to
the  attention  of  the  Board;  and  if  to  the  Optionee,  shall be delivered
personally or  mailed  to  the  Optionee  at  the  address  appearing  in the  records
of the  Company.  Such  addresses  may be  changed at any time  by written  notice to the
other  party given  in accordance with this paragraph 7(c).
 






	(d) 	 	 The
failure of the  Optionee or the Company  to insist  upon strict  compliance  with any
provision  of this  Agreement  or the  Plan,  or to assert any right the  Optionee  or
the  Company,  respectively,  may have under this  Agreement  or the Plan,  shall not be
deemed  to be a waiver  of such  provision  or right  or any  other  provision  or  right
of this  Agreement or the Plan.
 






	(e) 	 	 Nothing
in  the  Plan  or  this  Agreement  shall  confer  on any  individual  any right  to
continue  in the employ or other  service  of the  Company  or any of its  Subsidiaries
(if  applicable)  or  interfere  in any  way  with  the  right  of  the  Company  and
its  stockholders  to terminate the  individual’s  employment or other service at
any time.
 






	(f) 	 	 Any
and  all  payments  hereunder  to  the  Optionee  shall  be made  from  the  general
funds  of  the  Company  and no  special  or  separate  fund  shall  be  established  or
other  segregation  of assets made to assure  such  payments;  provided,  however,  that
bookkeeping  reserves may be  established in  connection  with  the  satisfaction  of
payment  obligations  hereunder.  The  obligations  of the  Company  hereunder  are
unsecured  and  constitute a mere promise by  the  Company  to make  benefit  payments
in  the  future  and,  to the  extent  that  any  person  acquires  a  right  to  receive
payments  hereunder  from the Company,  such  right  shall be no  greater  than the
right  of an  general  unsecured  creditor  of  the  Company.
 






	(g) 	 	 This
Agreement  (together  with  the  Plan)  contains  the entire  agreement  between the
parties with  respect to the subject  matter  hereof  and  supersedes  all  prior
agreements,  written or oral,  with  respect  thereto.
 





IN  WITNESS
WHEREOF,  the  Company  and  the  Optionee  have  executed  this  Agreement  as of the
day and year first  above  written.  
 

	 	MFA
      MORTGAGE INVESTMENTS, INC.
	 	 	 
	 	By: 	                                                 
	 	Name:
       	 
	 	Title:
       	 
	 	 	 
	 	                                                                          

	 	[NAME           OF
  OPTIONEE]





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