Unassociated Document


    
      EXHIBIT
10.4

       

       

       

       

      EMPLOYEE AND DIRECTOR

      


      INCENTIVE
RESTRICTED SHARE PLAN

      


      OF

      


      AMERICAN
REALTY CAPITAL NEW YORK RECOVERY REIT, INC.

      


      
        SECTION 1.  PURPOSES
OF THE PLAN AND DEFINITIONS

      

      


      1.1  Purposes.  The
purposes of the Employee and Director Incentive Restricted Share Plan
(this “Plan”) of
American Realty Capital New York Recovery REIT, Inc. (the “Company”)
are to:

      


      (1)  provide
incentives to individuals chosen to receive share-based awards because of their
ability to improve operations and increase profits;

      


      (2)  encourage
selected persons to accept positions with or continue to provide services to the
Company, the Advisor and Affiliates of the Company; and

      


      (3)  increase
the interest of Directors in the Company’s welfare through their participation
in the growth in value of the Company’s Shares.

      


      To
accomplish these purposes, this Plan provides a means whereby employees of the
Advisor and Affiliates of the Company, officers of the Company, the Advisor and
Affiliates of the Company, Directors and other enumerated persons may receive
Awards.

      


      1.2  Definitions.  For
purposes of this Plan, the following terms have the following
meanings:

      


      “Advisor”
means the Person or Persons, if any, appointed, employed or contracted with by
the Company to be responsible for directing or performing the day-to-day
business affairs of the Company, including any Person to whom the Advisor
subcontracts substantially all such functions.  The initial Advisor is
New York Recovery Advisors, LLC.

      


      “Affiliate”
means any Person (other than an Advisor), whose employees, directors or officers
are eligible to receive Awards under this Plan.  The determination of
whether a Person is an Affiliate shall be made by the Board acting in its sole
and absolute discretion.

      


      “Applicable
Laws” means the requirements relating to the administration of Awards
under state corporation laws, U.S. federal and state securities laws, the Code,
any stock exchange or quotation system on which the Shares are listed or quoted
and the applicable laws of any foreign country or jurisdiction where Awards are,
or will be, granted under this Plan.

      


      “Articles of
Incorporation” means the articles of incorporation of the Company, as the
same may be amended from time to time.

      


      “Award”
means any award of Restricted Shares under this Plan.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      “Award
Agreement” means, with respect to each Award, the written agreement
executed by the Company and the Participant or other written document approved
by the Board setting forth the terms and conditions of the Award.

      


      “Board”
means the Board of Directors of the Company.

      


      “Code”
means the Internal Revenue Code of 1986, as amended from time to
time.

      


        “Committee” means the Board or a duly
appointed committee of the Board to which the Board has delegated its powers and
functions hereunder.

    

     

    
      “Company”
means American Realty Capital New York Recovery REIT, Inc.

      


      “Director”
means a person elected or appointed and serving as a member of the Board in
accordance with the Articles of Incorporation and the Maryland General
Corporation Law.

      


      “Director
Shares” means Shares issued under Section
6.

      


      “Effective
Date” has the meaning given it in Section
15.

      


      “Employment
Termination” means that a Participant has ceased, for any reason and with
or without cause, to be an employee or Director of, or a consultant to, the
Company, the Advisor or any Affiliate of the Company.  However, the
term “Employment Termination” shall not include a transfer of a Participant from
the Company to the Advisor or any Affiliate of the Company or the Advisor or
vice versa, or from any
such Affiliate to another, or a leave of absence duly authorized by the
Company unless the Board has provided otherwise.

      


      “Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to
time.

      


      “Fair Market
Value” means with respect to Shares:

      


      (i)  If
the Shares are listed on any established stock exchange or a national market
system, their Fair Market Value shall be the closing sales price for the Shares,
or the mean between the high bid and low asked prices if no sales were reported,
as quoted on such system or exchange (or, if the Shares are listed on more than
one exchange, then on the largest such exchange) for the date the value is to be
determined (or if there are no sales or bids for such date, then for the last
preceding business day on which there were sales or bids), as reported in The Wall Street
Journal.

      


      (ii)  If
the Shares are regularly quoted by a recognized securities dealer but selling
prices are not reported, or if there is no secondary trading market for the
Shares, their Fair Market Value shall be determined in good faith by the
Board.

      


      “Grant
Date” has the meaning set forth in Section
5.1(c).

      


      “Non-Employee
Director” means a person who is a Director of the Company, but who is not
also an employee or officer of the Company or the Advisor.

      


      “Participant”
means an eligible person who is granted an Award.

       

      
        
          
          

        

        
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      “Person”
means an individual, a corporation, partnership, trust, association, or any
other entity.

      


      “Plan”
means this Employee and Director Incentive Restricted Share Plan.

      


      “Restricted
Shares” means an Award granted under Section
5.2.

      


      “Retainer”
has the meaning given it in Section
6.3.

      


      “Rule
16b-3” means Rule 16b-3 adopted under Section 16(b) or any successor
rule, as it may be amended from time to time, and references to paragraphs or
clauses of Rule 16b-3 refer to the corresponding paragraphs or clauses of Rule
16b-3 as it exists at the Effective Date or the comparable paragraph or clause
of Rule 16b-3 or successor rule, as that paragraph or clause may thereafter be
amended.

      


      “Section
16(b)” means Section 16(b) of the Exchange Act.

      


      “Section
409A
of the Code” means the
nonqualified deferred compensation rules under Section 409A of the Code and any
applicable Treasury regulation or other official guidance promulgated
thereunder.

      


      “Securities
Act” means the Securities Act of 1933, as amended from time to
time.

      


      “Shares”
means common shares of capital stock of the Company, $0.01 par value per
share.

      


      
        SECTION 2.  ELIGIBLE
PERSONS

      

      


      Every
person who, at or as of the Grant Date, is:

      


      (a)  a
full-time employee of the Advisor, the Company or any Affiliate of the
Company;

      


      (b)  an
officer of the Company, the Advisor or any Affiliate of the
Company;

      


      (c)  a
Director of the Company;

      


      (d)  a
director of the Advisor or any Affiliate of the Company; or

      


      (e)  someone
whom the Board designates as eligible for an Award because the
person:

      


      (i)  performs
bona fide consulting or advisory services for the Company, the Advisor or any
Affiliate of the Company pursuant to a written agreement (other than services in
connection with the offer or sale of securities in a capital-raising
transaction), and

      


      (ii)  has
a direct and significant effect on the financial development of the Company or
any Affiliate of the Company,

      


      shall be
eligible to receive Awards hereunder.

       

      
        
          
          

        

        
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      Directors
of the Company who are not full-time employees are only eligible to receive
Director Shares under Section
6.

      


      
        SECTION 3.  SHARES
SUBJECT TO THIS PLAN

      

      


      The total
number of Shares that may be issued under Awards shall not exceed 5.0%
of the Company’s outstanding Shares on a fully diluted basis at any time and in
any event will not, exceed 7,500,00 Shares.  The number of Shares
reserved for issuance under this Plan is subject to adjustment in accordance
with the provisions for adjustment in Section
5.1.  If any Shares awarded under this Plan are forfeited for
any reason, the number of forfeited Shares shall again be available for purposes
of granting Awards under this Plan.

      


      
        SECTION 4.  ADMINISTRATION

      

      


      4.1  Administration.  This
Plan shall be administered by the Committee.

      


      4.2  Committee’s
Powers.  Subject to the express provisions of this Plan,
the Committee shall have the authority, in its sole
discretion:

      


      (a)  to
adopt, amend and rescind administrative and interpretive rules and regulations
relating to this Plan;

      


      (b)  to
determine the eligible persons to whom, and the time or times at which, Awards
shall be granted;

      


      (c)  to
determine the number of Shares that shall be the subject of each
Award;

      


      (d)  to
determine the terms and provisions of each Award (which need not be identical)
and any amendments thereto, including provisions defining or otherwise relating
to:

      


      (i)  the
extent to which the transferability of Shares issued or transferred pursuant to
any Award is restricted;

      


      (ii)  the
effect of Employment Termination on an Award;

      


      (iii)  the
effect of approved leaves of absence; and

      


      (iv)  to
construe the respective Award Agreements and this Plan.

      


        
(e)  to make determinations of the Fair Market Value of
Shares;

      


        
(f)  to waive any provision, condition or limitation set forth
in an Award Agreement;

      


        
(g)  to delegate its duties under this Plan to such agents as
it may appoint from time to time; and

       

      
        
          
          

        

        
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(h)  to make all other determinations, perform all other acts
and exercise all other powers and authority necessary or advisable for
administering this Plan, including the delegation of those ministerial acts and
responsibilities as the Committee deems appropriate.

      


      The
Committee may correct any defect, supply any omission or reconcile any
inconsistency in this Plan, in any Award or in any Award Agreement in the manner
and to the extent it deems necessary or desirable to implement this Plan, and
the Committee shall be the sole and final judge of that necessity or
desirability.  The determinations of the Committee on the matters
referred to in this Section 4.2 shall be
final and conclusive.  Notwithstanding any provision in this Plan to the
contrary, Awards will be made to Non-Employee Directors only under Section 6 of this
Plan.  In addition, except as provided in Section 5.1(b) herein, the
Committee may not in any manner exercise discretion under this Plan with respect
to any Awards made to Non-Employee Directors.

      


      4.3  Term of
Plan.  No Awards shall be granted under this Plan after 10
years from the Effective Date of this Plan.

      


      
        SECTION 5.  CERTAIN
TERMS AND CONDITIONS OF AWARDS

      

      


      5.1  All
Awards.  All Awards shall be subject to the following terms and
conditions:

      


      (a)  Changes in Capital
Structure.  If the number of outstanding Shares is increased by
means of a share dividend payable in Shares, a share split or other subdivision
or by a reclassification of Shares, then, from and after the record date for
such dividend, subdivision or reclassification, the number and class of Shares
subject to this Plan shall be increased in proportion to such increase in
outstanding Shares.  If the number of outstanding Shares is decreased
by means of a reverse share split or other combination or by a reclassification
of Shares, then, from and after the record date for such combination or
reclassification, the number and class of Shares subject to this Plan shall be
decreased in proportion to such decrease in outstanding Shares.

      


      (b)  Certain Corporate
Transactions.   In the event of any change in the capital
structure or business of the Company by reason of any recapitalization,
reorganization, merger, consolidation, split-up, subdivision, combination,
exchange of Shares or any similar change affecting the Company’s capital
structure or business, then the aggregate number and kind of Shares which
thereafter may be issued under this Plan shall be appropriately adjusted
consistent with such change in such manner as the Committee or the Board may
deem equitable to prevent substantial dilution or enlargement of the rights
granted to, or available for, Participants under this Plan, and any such
adjustment determined by the Committee or the Board in good faith shall be
binding and conclusive on the Company and all Participants and employees and
their respective heirs, executors, administrators, successors and
assigns.

      


      (c)  Grant
Date.  Each Award Agreement shall specify the date as of which
it shall be effective (the “Grant
Date”).

      


      (d)  Vesting.  Each
Award shall vest, and any restrictions thereunder shall lapse, as the case may
be, at such times and in such amounts as may be specified by the Committee in
the applicable Award Agreement.

       

      
        
          
          

        

        
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      (e)  Nonassignability of
Rights.  Awards shall not be transferable other than with the
consent of the Committee or the Board or by will or the laws of descent and
distribution.

      


      (f)  Termination of Employment
from the Company, the Advisor or any Affiliate of the
Company.  The Committee shall establish, in respect of each
Award when granted, the effect of an Employment Termination on the rights and
benefits thereunder and in so doing may, but need not, make distinctions based
upon the cause of termination (such as retirement, death, disability or other
factors) or which party effected the termination (the employer or the
employee).

      


      (g)  Minimum Purchase
Price.  Notwithstanding any provision of this Plan to the
contrary, if authorized but previously unissued Shares are issued under this
Plan, such Shares shall not be issued for a consideration which is less than as
permitted under Applicable Law, and in no event, shall such consideration be
less than the par value per Share multiplied by the number of Shares to be
issued.

      


      (h)  Other
Provisions.  Each Award Agreement may contain such other terms,
provisions and conditions not inconsistent with this Plan, as may be determined
by the Committee.

      


      5.2  Restricted
Shares.  Restricted Shares shall be subject to the following
terms and conditions:

      


      (a)  Grant.  The
Committee may grant one or more Awards of Restricted Shares to any Participant
other than Non-Employee Directors.  Each Award of Restricted Shares
shall specify the number of Shares to be issued to the Participant, the date of
issuance and the restrictions imposed on the Shares including the conditions of
release or lapse of such restrictions.  Upon the issuance of
Restricted Shares, the Participant may be required to furnish such additional
documentation or other assurances as the Committee may require to enforce
restrictions applicable thereto.

      


      (b)  Restrictions.  Except
as specifically provided elsewhere in this Plan or the Award Agreement regarding
Restricted Shares, Restricted Shares may not be sold, assigned, transferred,
pledged or otherwise disposed of or encumbered, either voluntarily or
involuntarily, until the restrictions have lapsed and the rights to the Shares
have vested.  The Committee may in its sole discretion provide for the
lapse of such restrictions in installments and may accelerate or waive such
restrictions, in whole or in part, based on service, performance or such other
factors or criteria as the Committee may determine.

      


      (c)  Dividends.  Unless
otherwise determined by the Committee, cash dividends with respect to Restricted
Shares shall be paid to the recipient of the Award of Restricted Shares on the
normal dividend payment dates, and dividends payable in Shares shall be paid in
the form of Restricted Shares having the same terms as the Restricted Shares
upon which such dividend is paid.  Each Award Agreement for Awards of
Restricted Shares shall specify whether and, if so, the extent to which the
Participant shall be obligated to return to the Company any cash dividends paid
with respect to any Restricted Shares which are subsequently
forfeited.

      


      (d)  Forfeiture of Restricted
Shares.  Except to the extent otherwise provided in the
applicable Award Agreement, when a Participant’s Employment Termination occurs,
the Participant shall automatically forfeit all Restricted Shares still subject
to restriction.

       

      
        
          
          

        

        
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        SECTION 6.  DIRECTOR
SHARES

      

       

      
        6.1 Automatic
Grant.  Non-Employee Directors shall receive 3,000 Restricted Shares
on the date of each annual stockholders’ meeting.

        


        6.2 Vesting. 
Notwithstanding the provisions of Section 5.1(d), Awards of Restricted
Shares made to Non-Employee Directors shall vest over a five-year period
following the first anniversary of the Grant Date in increments of 20% per
annum.

      

       

      6.3  Election.  The
Company shall pay to each individual who is a Non-Employee Director an annual
fee in the amount set from time to time by the Board (the “Retainer”).  Each
Non-Employee Director shall be entitled to receive his or her Retainer
exclusively in cash, exclusively in unrestricted Shares (“Director
Shares”) or any portion in cash and Director Shares.  Following
the approval of this Plan by the Board, each Non-Employee
Director shall be given the opportunity, during the month in which the
Non-Employee Director first becomes a Non-Employee Director, and during each
December thereafter, to elect among these choices for the balance of the
calendar year (in the case of the election made during the month the
Non-Employee Director first becomes a Non-Employee Director) and for the ensuing
calendar year (in the case of a subsequent election made during any
December).  If the Non-Employee Director chooses to receive at least
some of his or her Retainer in Director Shares, the election shall also indicate
the percentage of the Retainer to be paid in Director Shares.  If a
Non-Employee Director makes no election during his or her first opportunity to
make an election, the Non-Employee Director shall be assumed to have elected to
receive his or her entire Retainer in cash.

      


      6.4  Issuance.  The
Company shall make the first issuance of Director Shares to electing Non-Employee Directors
on the first business day following the approval of this Plan by the Board.  Subsequent issuances of Director Shares shall be made
on the first business day following each anniversary of the approval of this Plan by the Board and shall be made
to all persons who are Non-Employee Directors on that day except any
Non-Employee Director whose Retainer is to be paid entirely in
cash.  The number of Shares issuable to the electing Non-Employee Directors
on the relevant date indicated above shall equal:

      


      (% x
R)/P, where:

      


      % = the
percentage of the Non-Employee Director’s Retainer that the Non-Employee
Director elected or is deemed to have elected to receive in the form of Director
Shares, expressed as a decimal;

      


      R = the
Non-Employee Director’s Retainer for the year during which the issuance occurs;
and

      


      P = the
Fair Market Value.

      


      Director
Shares shall not include any fractional Shares.  Fractions shall be
rounded to the nearest whole Share (with one-half being rounded
upward).

      


      
        SECTION 7.  SECURITIES
LAWS

      

      


      Nothing
in this Plan or in any Award or Award Agreement shall require the Company to
issue any Shares with respect to any Award if, in the opinion of counsel for the
Company, that issuance could constitute a violation of any Applicable
Laws.  As a condition to the grant of any Award, the Company may
require the Participant (or, in the event of the Participant’s death, the
Participant’s legal representatives, heirs, legatees or distributees) to provide
written representations concerning the Participant’s (or such other person’s)
intentions with regard to the retention or disposition of the Shares covered by
the Award and written covenants as to the manner of disposal of such Shares as
may be necessary or useful to ensure that the grant or disposition thereof will
not violate the Securities Act, any other law or any rule of any applicable
securities exchange or securities association then in effect.  The
Company shall not be required to register any Shares under the Securities Act or
register or qualify any Shares under any state or other securities
laws.

       

      
        
          
          

        

        
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        SECTION 8.  EMPLOYMENT
OR OTHER RELATIONSHIP

      

      


      Nothing
in this Plan or any Award shall in any way interfere with or limit the right of
the Company, the Advisor or any Affiliate of the Company to terminate any
Participant’s employment or status as a consultant or Director at any time, nor
confer upon any Participant any right to continue in the employ of, or as a
Director or consultant of, the Company, the Advisor or any Affiliate of the
Company.

      


      
        SECTION 9.  AMENDMENT,
SUSPENSION AND TERMINATION OF THIS PLAN

      

      


      The Board
may at any time amend, suspend or discontinue this Plan, provided that such
amendment, suspension or discontinuance meets the requirements of Applicable
Laws, including without limitation, any applicable requirements for
stockholder approval.  Notwithstanding the above, an amendment,
suspension or discontinuation shall not be made if it would impair the rights of
any Participant under any Award previously granted, without the Participant’s
consent, except to conform this Plan and Awards granted to the requirements of
Applicable Laws.  The provisions of this Plan relating to Awards for
Non-Employee Directors may not be amended more than once each six
months.  Notwithstanding any provision of the Plan to the
contrary, if the Board determines that any Award may be subject to
Section 409A of the Code, the Board may adopt such amendment to the Plan
and the applicable Award Agreement or adopt other policies and procedures
(including amendments, policies and procedures with retroactive effect), or take
any other actions that the Board determines are necessary or appropriate,
without the consent of the Participant, to (a) exempt the Award from
Section 409A of the Code and/or preserve the intended tax treatment of the
benefits provided with respect to the Award, or (b) comply with the
requirements of Section 409A of the Code.

      


      
        SECTION 10.  LIABILITY
AND INDEMNIFICATION OF THE BOARD

      

      


      No person
constituting, or member of the group constituting, the Board shall be liable for
any act or omission on such person’s part, including but not limited to the
exercise of any power or discretion given to such member under this Plan, except
for those acts or omissions resulting from such member’s gross negligence or
willful misconduct.  The Company shall indemnify each present and
future person constituting, or member of the group constituting, the Board
against, and each person or member of the group constituting the Board shall be
entitled without further act on his or her part to indemnity from the Company
for, all expenses (including the amount of judgments and the amount of approved
settlements made with a view to the curtailment of costs of litigation)
reasonably incurred by such person in connection with or arising out of any
action, suit or proceeding to the fullest extent permitted by law and by the
Articles of Incorporation and Bylaws of the Company.

       

      
        
          
          

        

        
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        SECTION 11.  SEVERABILITY

      

      


      If any
provision of this Plan is held to be illegal or invalid for any reason, that
illegality or invalidity shall not affect the remaining portions of this Plan,
but such provision shall be fully severable and this Plan shall be construed and
enforced as if the illegal or invalid provision had never been included in this
Plan.  Such an illegal or invalid provision shall be replaced by a
revised provision that most nearly comports to the substance of the illegal or
invalid provision.  If any of the terms or provisions of this Plan or
any Award Agreement conflict with the requirements of Applicable Laws, those
conflicting terms or provisions shall be deemed inoperative to the extent they
conflict with Applicable Law.

      


      
        SECTION 12.  SECTION
409A OF THE CODE

      

      


      Awards
granted under the Plan are intended to be exempt from Section 409A of the
Code.  To the extent that the Plan is not exempt from the requirements
of Section 409A of the Code, the Plan is intended to comply with the
requirements of Section 409A of the Code and shall be limited, construed and
interpreted in accordance with such intent.  Notwithstanding the
foregoing, in no event whatsoever shall the Company be liable for any additional
tax, interest or penalty that may be imposed on a Participant by Section 409A of
the Code or any damages for failing to comply with Section 409A of the
Code.

      


      
        SECTION 13.  WITHHOLDING

      

      


      The
Company shall have the right to deduct from any payment to be made to a
Participant, or to otherwise require, prior to the issuance or delivery of any
Shares or the payment of any cash hereunder, payment by the Participant of, any
federal, state or local taxes required by law to be withheld.  Upon
the vesting of Restricted Shares, or upon making an election under Section 83(b)
of the Code, a Participant shall pay all required withholding to the
Company.  The Board may permit any such statutory withholding
obligation with regard to any Participant to be satisfied by reducing the number
of Shares otherwise deliverable or by delivering Shares already
owned.

      


      
        SECTION 14.  GOVERNING
LAW

      

      


      This Plan
shall be governed and construed in accordance with the laws of the State of
Maryland (regardless of the law that might otherwise govern under applicable
principles of conflict of laws).

      


      
        SECTION 15.  EFFECTIVE
DATE AND PROCEDURAL HISTORY

      

      


      This Plan
was originally approved by the Company’s Board on September 22, 2010 (the “Effective
Date”).

       

      
        
          
          

        

        
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