Exhibit
10.1


 


200  
RESTRICTED STOCK UNIT AWARD


 


AGREEMENT EVIDENCING A GRANT OF

RESTRICTED STOCK UNITS


 


1.   GRANT
OF UNITS.  Pursuant
to the Lehman Brothers Holdings Inc. (“Holdings”) 1996 Management Ownership
Plan (the “Plan”), you are hereby granted, as of          ,
200   (the “Date of Grant”), the number of Restricted Stock Units (“Units”)
for shares of Holdings’ common stock, par value $.10 per share (the “Common
Stock”), set forth on the award statement with your name on it delivered to you
herewith (which number of Units may be adjusted pursuant to Paragraph 8 below).


 


2.   ADDITIONAL
DOCUMENTS; DEFINITIONS.  You have been provided with a copy of the
Plan, which is incorporated in this instrument by reference and made a part
hereof, and a copy of the Plan prospectus. 
The Plan and the prospectus should be carefully examined.  In the event of any conflict or ambiguity
between this instrument and the Plan, the terms of the Plan shall govern.  All capitalized terms not defined herein or
on Annex A attached hereto shall have the meaning ascribed to such terms under
the Plan.


 


3.   VESTING.  Subject to Paragraph 4, Units awarded to you
hereunder shall become vested in accordance with the following vesting
schedule:


 


•                              of
the Principal Units (     % of the total award) shall
become vested on          , 200  .


 


•              The
remaining            
Principal Units and all of the Discount Units (    % of the
total award) shall become vested on               ,
200  .


 


4.   ENTITLEMENT
TO RECEIVE COMMON STOCK.


 


(a)   General Rule.  Unless otherwise set forth herein, you shall
receive one share of Common Stock for each Unit that you hold on         ,
200   (the “Maturity Date”) and you shall be entitled to receive
freely transferable Shares of Common Stock as soon as practicable after the
Maturity Date.


 


(b)   Effect of Detrimental Activity.  Notwithstanding any other provision of this
Agreement if you engage in Detrimental Activity at any time prior to the Share
Payment Date, all Units held by you shall be forfeited and canceled.


 


(c)   Effect of Termination.  In the event of your Termination for any
reason or notification of Termination prior to                ,
200  , all Units held by you shall be forfeited and cancelled.  In the event of any Termination not described
in the preceding sentence, the following rules shall apply:


 


(i)            Voluntary
Termination with Competitive Activity. 
In the event of your voluntary Termination with Competitive Activity,
(i) all Discount Units shall be forfeited and canceled, (ii) if such
Termination occurs prior to                 ,
200  , all


 





















 


Principal Units shall be forfeited and
canceled and (iii) if such Termination occurs on or subsequent to                ,
200  , you shall be entitled to receive freely transferable shares of
Common Stock for              
of the Principal Units (      % of the total
award).


 


(ii)           Voluntary
Termination without Competitive Activity. 
In the event of your voluntary Termination without Competitive Activity,
you shall be entitled to receive (i) freely transferable shares of Common Stock
for the Principal Units and (ii) freely transferable shares of Common Stock
equal to       % of the Discount Units multiplied
by each full year of your employment with Holdings or a Subsidiary after              ,
200    and before your Termination.  However, if your Termination is a Full Career
Termination, you will be entitled to receive freely transferable shares of
Common Stock for all the Discount Units provided you do not engage in
Competitive Activity prior to the Share Payment Date.  In the event of Competitive Activity prior to
the Share Payment Date, the provisions specified in Paragraph 4(c)(i) shall
apply.


 


(iii)          Involuntary
Termination with Cause.  In the event
of your involuntary Termination with Cause, all Principal Units and Discount
Units shall be immediately forfeited and canceled.


 


(iv)          Involuntary
Termination without Cause.  In the
event of your involuntary Termination without Cause, you shall be entitled to
receive (i) freely transferable shares of Common Stock for the Principal Units
and (ii) freely transferable shares of Common Stock equal to   % of
the Discount Units multiplied by each full year of your employment with
Holdings or a Subsidiary after               ,
200    and before your Termination.  However, if your Termination is a Full Career
Termination, you will be entitled to receive freely transferable shares of
Common Stock for all the Discount Units.


 


(v)           Retirement.  Notwithstanding the foregoing provisions of
Paragraph 4(c)(i), (ii), (iii) and (iv), in the event of your Retirement and
provided you do not engage in Competitive Activity or Detrimental Activity, you
shall be entitled to receive freely transferable shares of Common Stock for all
Principal Units and Discount Units as soon as practicable after the end of the
sixth month following your Retirement. 
If you engage in Competitive Activity, the provisions specified in
Paragraph 4(c)(i) shall apply as of the date of your Retirement, and you shall
be obligated to repay to Holdings the full gross amounts or shares received in
excess of those which you would have received under Paragraph 4(c)(i).  If you engage in Detrimental Activity prior
to the Share Payment Date, you shall be obligated to repay to Holdings the full
gross amounts or shares you received under this Agreement.


 


(vi)          Termination
Due to Death; Disability.  Notwithstanding
the foregoing provisions of Paragraph 4(c)(i), (ii), (iii), (iv) and (v), in
the event of the occurrence (i) your death or Disability or (ii) your death or
Disability following a Termination described in Paragraph 4(c)(ii) or (iv)
hereof, all outstanding Units held by you shall become immediately payable and
you shall, as soon as practicable thereafter, receive freely transferable
shares of Common Stock.


 


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Any shares that become payable pursuant to
this Paragraph 4(c) (other than Paragraph (c)(v) or (vi)) shall be issued to
you on the Share Payment Date, subject to the application of Paragraph 4(b).  Notwithstanding any other provisions of this
Agreement, if any payment otherwise due hereunder would have the effect of
making you subject to the provisions of Code Section 409A(a)(1), such
payment shall be postponed until the earliest date upon which the payment could
be made without subjecting you to the provisions of Code Section 409A(a)(1).  Any remaining Units that are not payable
pursuant to the provisions of the Paragraph 4(c) shall be canceled by Holdings.


 


(d)   Affidavit.  In the event of your Termination on or after                 ,
200  , you may be requested, from time to time after your
Termination, to complete and sign an affidavit with respect to Competitive
Activity or Detrimental Activity, which includes representations and authorizes
Holdings to verify the representations. 
Any failure on your part to complete, sign and return the affidavit
within 60 days may cause you to forfeit all Units held by you at that time.


 


5.   DIVIDEND
EQUIVALENTS. 
With respect to each regular cash dividend or distribution paid or made
on Common Stock to holders of record on or after                 ,
200  , you shall be paid cash and/or credited with a number of
additional Units comparable in value to such dividend or distribution.  Such additional Units shall vest and become
payable at the same time as the Units to which they are attributable.


 


6.   LIMITATION
ON OBLIGATIONS. 
Holdings’ and any Subsidiary’s obligation with respect to the Units
granted hereunder is limited solely to the delivery to you of shares of Common
Stock on the date when such shares are due to be delivered hereunder, and in no
way shall Holdings or any Subsidiary become obligated to pay cash in respect of
such obligation (except for cash paid pursuant to Paragraphs 5 and 9 hereof).


 


7.   NON-ASSIGNMENT.  Units may not be sold, assigned, transferred,
pledged, hypothecated, or otherwise disposed of by you, except by will or the
laws of descent and distribution.  If you
or anyone claiming under or through you attempts to violate this Paragraph 7,
such attempted violation shall be null and void and without effect, and
Holdings’ obligation to issue any Common Stock hereunder shall terminate.


 


8.   EQUITABLE
ADJUSTMENT. 
In the event of a Change in Capitalization occurring on or after the
Date of Grant specified above and prior to the Share Payment Date, the number
and kind of shares of Common Stock which may be issued with respect to Units
shall be adjusted so as to reflect such change.


 


9.   CHANGE
IN CONTROL. 
Except as set forth below, upon the occurrence of a Change in Control
without the prior approval of a majority of the independent members of the
Incumbent Board, your Units shall vest immediately, the sales restrictions
shall lapse and shares of Common Stock shall be issued.  Except as set forth below, upon the
occurrence of a Change in Control with the prior approval of a majority of the
independent members of the Incumbent Board, you shall receive, in the same form
of consideration as that received by shareholders generally, the lesser of (a)
the undiscounted market value (at the time of grant) of the shares of Common
Stock underlying your outstanding Units or (b) the price paid by an


 


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acquirer for such shares of Common Stock, and the excess, if any, of
the price paid by an acquirer over such undiscounted market value shall be
deferred for the shorter of (x) two years following such Change in Control or
(y) the term of any remaining restrictions (the “Deferred Period”), but your
Units shall remain otherwise subject to all issuance restrictions during the
Deferred Period.  Neither of the
foregoing shall be effective to the extent you have tender or voting rights
over shares of Common Stock held in Trust with respect to any Units, in which case
you would only be issued Common Stock or receive the undiscounted market value
in the same form of consideration as that received by shareholders generally
(and after the Deferred Period, the excess price) in respect of such Units upon
successful completion of a Change in Control.


 


10.   TREATMENT
IN BANKRUPTCY. 
(a) If you are an employee of Holdings, Holdings agrees to deliver, and
(b) if you are an employee of a Subsidiary, Holdings agrees to deliver to (or
at the direction of) such Subsidiary, shares of Common Stock on the date when
such shares are due to be delivered under this Agreement in satisfaction of
each Unit granted to you hereunder.  If
you are an employee of a Subsidiary, Holdings’ obligation in clause (b) of the
preceding sentence is created expressly for the benefit of you, and you shall
have the full right to enforce Holdings’ obligation to deliver Common Stock as
if such obligation were made directly in favor of you.  All of your claims arising from, in
connection with, or in any way relating to, any failure of Holdings to deliver
to you, or to a Subsidiary for delivery by such Subsidiary to you, shares of
Common Stock on the date when such shares are due to be delivered under this
Agreement in satisfaction of each Unit granted to you shall be deemed, in the
event of a bankruptcy of Holdings, to be claims for damages arising from the
purchase or sale of Common Stock of Holdings, within the meaning of section 510(b)
of the Bankruptcy Code and shall have in such bankruptcy the same priority as,
and no greater priority than, common stock interests in Holdings.


 


11.   AMENDMENT.  The terms of this Agreement may be amended
from time to time by the Committee in its sole discretion in any manner that it
deems appropriate, provided, however, that no such amendment shall, without
your consent, diminish your rights under this Agreement.


 


12.   BINDING
ACTIONS.  Any
action taken or decision made by the Committee or its designees arising out of
or in connection with the construction, administration, interpretation or
effect of the Plan or this Agreement shall lie within its sole and absolute
discretion, as the case may be, and shall be final, conclusive and binding on
you and all persons claiming under or through you.  By accepting this grant or other benefit
under the Plan, you and each person claiming under or through you shall be
conclusively deemed to have indicated acceptance and ratification of, and
consent to, any action taken under the Plan by the Committee or its designees.


 


13.   NO
RIGHT TO CONTINUED EMPLOYMENT.  The grant of Units shall not confer on you
any right to be retained in the employ of Holdings or a subsidiary, or to
receive subsequent Units or other awards under the Plan.  The right of Holdings or any subsidiary to
terminate your employment with it at any time or as otherwise provided by any
agreement between Holdings or any subsidiary and you is specifically reserved.


 


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14.   APPLICABLE
LAW.  The
validity, construction, interpretation, administration, and effect of the Plan,
and of its rules and regulations, and rights relating to the Plan and to this
Agreement, shall be governed by the substantive laws, but not the choice of law
rules, of the State of Delaware.


 


15.   WITHHOLDING/DEDUCTIONS.  Holdings shall have the right to deduct
applicable taxes from all amounts payable to you.  It shall be a condition to the obligation of
Holdings to issue shares of Common Stock hereunder (a) that you (or, in event
of your death, your estate or any person who acquires the right to this award
by bequest or inheritance or otherwise by reason of your death) pay to Holdings
or its designee, upon its demand, in accordance with the Plan, either in the
form of cash or freely transferable shares of Common Stock such amount as may
be required by law for the purpose of satisfying its obligation or the
obligation of any other person to withhold any taxes required by law which are
incurred by reason of the issuance of such shares of Common Stock, and (b) that
you (or, in the event of your death, your estate or any person who acquires the
right to this award by bequest or inheritance or otherwise by reason of your
death) provide Holdings with any forms, documents or other information
reasonably required by Holdings in connection with the grant.  If the amount requested for the purpose of
satisfying the withholding obligation is not paid, Holdings may refuse to issue
shares of Common Stock and/or related dividend equivalents or take any other
action it deems necessary to fulfill the withholding obligation.  Holdings shall further have the right to
deduct from all amounts remaining payable to you after satisfaction of the
minimum statutory withholding obligations described above, the amount of any
deficit, debt, tax obligation or other liability or obligation of any kind
which you may at that time have with respect to Holdings or any Subsidiary.


 


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ANNEX A


 


DEFINITIONS


 


“Cause” means a
material breach by a person of an employment contract between the person and
Holdings or any Subsidiary, failure by a person to devote substantially all
business time exclusively to the performance of his or her duties for Holdings
or any Subsidiary, willful misconduct, dishonesty related to the business and
affairs of Holdings or any Subsidiary, conviction of a felony or of a
misdemeanor constituting a statutory disqualification under U.S. securities
laws (or failure to contest prosecution for a felony or such a misdemeanor),
habitual or gross negligence in the performance of the person’s duties,
solicitation of employees of Holdings or any Subsidiary to work at another
company, improper use or disclosure of confidential information, the violation
of policies and practices adopted by Holdings or any Subsidiary including, but
not limited to the Code of Conduct, or a material violation of the conflict of
interest, proprietary information or business ethics policies of Holdings or
any Subsidiary.


 


“Change in Capitalization”
means the occurrence of a circumstance described in Section 14 of the
Plan.


 


“Committee” shall
mean the Compensation and Benefits Committee of the Incumbent Board (see
definition of Change in Control in the Plan).


 


“Competitive Activity”
means involvement (whether as an employee, proprietor, consultant or otherwise)
with any person or entity (including any company and its affiliates) engaged in
any business activity which is materially competitive with any business carried
on by Holdings or any of its Subsidiaries or affiliates on the date of
termination of a person’s employment with Holdings and any of its Subsidiaries,
as determined in the sole discretion of the Committee.


 


“Detrimental Activity”
means at any time (i) using confidential information received during a person’s
employment with Holdings or any Subsidiary, their affiliates or their clients,
in breach of such person’s obligations to keep such information confidential;
(ii) directly or indirectly persuading or attempting to persuade, by any means,
any employee of Holdings or any Subsidiary to terminate employment with any of
the foregoing or to breach any of the terms of his or her employment with the
foregoing; (iii) directly or indirectly making any statement that is, or could
be, disparaging of Holdings, its Subsidiaries or affiliates, or any of their
employees (except as necessary to respond truthfully to any inquiry from
applicable regulatory authorities or to provide information pursuant to legal
process); or (iv) directly or indirectly engaging in any activity that is
substantially injurious to the financial condition, reputation, or goodwill of
Holdings or its Subsidiaries or affiliates, in each case as determined in the
sole discretion of the Committee.


 


“Disability” means a
disability under both the Long-Term Disability Insurance Plan and the Social
Security Act.


 


“Discount Units”
shall mean the number of Units (and any dividend equivalents related thereto)
related to the       % discount upon issuance of
the award.


 


“Full Career Termination”
means a Termination when (i) a person has at least 20 years of service or (ii)
a person meets all of the following criteria: (x) the person’s age plus


 





















 


years of service with Holdings or any subsidiary equals at least 65,
(y) the person is at least 45 years old, and (z) the person has at least 10
years of service with Holdings or any subsidiary.


 


“Principal Units”
shall mean the number of Units (and any dividend equivalents related thereto)
related to the undiscounted base portion of the award (       %
of the total number of units awarded).


 


“Retirement” shall
mean a Termination of employment which meets the criteria for retirement under
Holdings’ qualified defined benefit pension plan, provided that the person has
signed an agreement not to engage in Competitive Activity or Detrimental
Activity, in a form prescribed in the sole discretion of the Committee.


 


“Share Payment Date”
means as soon as practicable after the earlier of (a) the Maturity Date or (b)
the completion of the fiscal quarter following the one-year anniversary of
termination of employment.


 


“Termination” means
the end of employment with Holdings or a Subsidiary.  The date of Termination and the reason for
Termination are as determined in the sole discretion of the Committee.


 


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