Document:

exv10w3

EXHIBIT 10.3

PROVIDENT MORTGAGE CAPITAL ASSOCIATES, INC.

FORM OF 2011 EQUITY INCENTIVE PLAN

1. PURPOSE. The Plan is intended to provide incentives to directors, officers, advisors,
consultants, key employees, and others expected to provide significant services to the Company and
its Subsidiaries, including the personnel, employees, officers and directors of the other
Participating Companies, to encourage a proprietary interest in the Company, to encourage such key
personnel to remain in the service of the Company and the other Participating Companies, to
attract new personnel with outstanding qualifications, and to afford additional incentive to
others to increase their efforts in providing significant services to the Company and the other
Participating Companies. In furtherance thereof, the Plan permits awards of equity-based
incentives to key personnel, employees, officers and directors of, and certain other providers of
services to, the Company or any other Participating Company.

2. DEFINITIONS. As used in this Plan, the following definitions apply:

     “Act” shall mean the Securities Act of 1933, as amended.

     “Award Agreement” shall mean a written agreement evidencing a Grant pursuant to the Plan.

     “Board” shall mean the Board of Directors of the Company.

     “Cause” shall mean, unless otherwise provided in the Grantee’s Award Agreement, (i) engaging
in (A) willful or gross misconduct or (B) willful or gross neglect, (ii) repeatedly failing to
adhere to the directions of superiors or the Board or the written policies and practices of the
Company, the Subsidiaries, the Manager or any of their respective affiliates, (iii) the commission
of a felony or a crime of moral turpitude, or any crime involving the Company, the Subsidiaries,
the Manager or any of their respective affiliates, (iv) fraud, misappropriation, embezzlement or
material or repeated insubordination, (v) a material breach of the Grantee’s employment agreement
(if any) with the Company, the Subsidiaries, the Manager or any of their respective affiliates
(other than a termination of employment by the Grantee), or (vi) any illegal act detrimental to the
Company; the Subsidiaries, the Manager or any of their respective affiliates, all as determined by
the Committee; provided, however, that if at any particular time the Grantee is subject to an
effective employment or other agreement with the Company or any Participating Company, then, in
lieu of the foregoing definition, “Cause” shall at that time have such meaning as may be specified
in such agreement.

     “Change of Control” means unless otherwise provided in the Grantee’s Award Agreement, the
happening of any of the following:

     (i) any “person,” including a “group” (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act, but excluding the Company, any entity controlling, controlled by or under common
control with the Company, any trustee, fiduciary or other person or entity holding securities under
any employee benefit plan or trust of the Company or any such entity, and, with respect to any
particular Grantee, the Grantee and any “group” (as such term is used in Section 13(d)(3) of the
Exchange Act) of which the Grantee is a member), is or becomes the “beneficial owner” (as defined
in Rule 13(d)(3) under the Exchange Act), directly or indirectly, of securities of the Company
representing 50% or more of either (A) the combined voting power of the Company’s then outstanding
securities or (B) the then outstanding Shares (in either such case other than as a result of an
acquisition of securities directly from the Company); provided, however, that in no event shall a
Change of Control be deemed to have occurred upon an initial public offering of the Shares under
the Act; or

 

 

     (ii) any consolidation or merger of the Company where the shareholders of the Company,
immediately prior to the consolidation or merger, would not, immediately after the consolidation or
merger, beneficially own (as such term is defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, shares representing in the aggregate 50% or more of the combined voting power of the
securities of the corporation issuing cash or securities in the consolidation or merger (or of its
ultimate parent corporation, if any); or

     (iii) there shall occur (A) any sale, lease, exchange or other transfer (in one transaction or
a series of transactions contemplated or arranged by any party as a single plan) of all or
substantially all of the assets of the Company, other than a sale or disposition by the Company of
all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting
power of the voting securities of which are owned by “persons” (as defined above) in substantially
the same proportion as their ownership of the Company immediately prior to such sale or (B) the
approval by shareholders of the Company of any plan or proposal for the liquidation or dissolution
of the Company; or

     (iv) the members of the Board at the beginning of any consecutive 24-calendar-month period
(the “Incumbent Directors”) cease for any reason other than due to death to constitute at least a
majority of the members of the Board; provided that any Director whose election, or nomination for
election by the Company’s shareholders, was approved or ratified by a vote of at least a majority
of the members of the Board then still in office who were members of the Board at the beginning of
such 24-calendar-month period, shall be deemed to be an Incumbent Director.

Notwithstanding the foregoing, no event or condition shall constitute a Change in Control to the
extent that, if it were, a 20% tax would be imposed under Section 409A of the Code; provided that,
in such a case, the event or condition shall continue to constitute a Change in Control to the
maximum extent possible (e.g., if applicable, in respect of vesting without an acceleration of
distribution) without causing the imposition of such 20% tax. Without limiting the foregoing, no
event or condition described in clauses (i) through (iv) above shall constitute a Change of Control
if it results from a transaction between the Company and the Manager, or an affiliate of the
Manager.

     “Code” shall mean the U.S. Internal Revenue Code of 1986, as amended and the regulations
promulgated thereunder.

     “Committee” shall mean the Compensation Committee of the Company or any subcommittee of the
Board as appointed by the Board in accordance with Section 4 of the Plan; provided, however, that
the Committee shall at all times consist of two or more persons who, at the time of their
appointment, each qualified as a “Non-Employee Director” under Rule 16b-3(b)(3)(i) promulgated
under the Exchange Act and, to the extent that relief from the limitation of Section 162(m) of the
Code is sought, as an “Outside Director” under Section 1.162-27(e)(3)(i) of the Treasury
Regulations.

     “Common Stock” shall mean the Company’s common stock, par value $0.01 per share, either
currently existing or authorized hereafter.

     “Company” shall mean Provident Mortgage Capital Associates, Inc., a Maryland corporation.

     “DER” shall mean a right awarded under Section 11 of the Plan to receive (or have credited)
the equivalent value (in cash or Shares) of dividends paid on Common Stock.

     “Disability” shall mean, unless otherwise provided by the Committee in the Grantee’s Award
Agreement, the occurrence of an event which would entitle the Grantee to the payment of disability
income under an approved long-term disability income plan or a long-term disability as determined
by the

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Committee in its absolute discretion pursuant to any other standard as may be adopted by the
Committee. Notwithstanding the foregoing, no circumstances or condition shall constitute a
Disability to the extent that, if it were, a 20% tax would be imposed under Section 409A of the
Code; provided that, in such a case, the event or condition shall continue to constitute a
Disability to the maximum extent possible (e.g., if applicable, in respect of vesting without an
acceleration of distribution) without causing the imposition of such 20% tax.

     “Eligible Persons” shall mean officers, directors, advisors, personnel and employees of and
consultants to the Participating Companies and other persons expected to provide significant
services (of a type expressly approved by the Committee as covered services for these purposes) to
one or more of the Participating Companies. For purposes of the Plan, and to the extent consistent
with applicable securities law, a provider of significant services (such as a consultant or
advisor) to the Company or any other Participating Company shall be deemed to be an Eligible
Person, but will be eligible to receive Grants (but in no event Incentive Stock Options), only
after a finding by the Committee in its discretion that the value of the services rendered or to be
rendered to the Participating Company is at least equal to the value of the Grants being awarded.

     “Employee” shall mean an individual, including an officer of a Participating Company, who is
employed (within the meaning of Code Section 3401 and the regulations thereunder) by the
Participating Company.

     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

     “Exercise Price” shall mean the price per Share of Common Stock, determined by the Board or
the Committee, at which an Option may be exercised.

     “Fair Market Value” shall mean the value of one share of Common Stock, determined as follows:

	 	(i)	 	If the Shares are then listed on a national stock exchange, the closing sales
price per Share on the exchange (or, if no such price is available for a certain date,
for the last preceding date on which there was a sale of Shares on such exchange), as
determined by the Committee.
	 
	 	(ii)	 	If the Shares are not then listed on a national stock exchange but are then
traded on an over-the-counter market, the average of the closing bid and asked prices
for the Shares in such over-the-counter market (or, if no such average is available for
a certain date, for the last preceding date on which there was a sale of such Shares in
such market), as determined by the Committee.
	 
	 	(iii)	 	If neither (i) nor (ii) applies, such value as the Committee in its discretion
may in good faith determine. Notwithstanding the foregoing, where the Shares are
listed or traded, the Committee may make discretionary determinations in good faith
where the Shares have not been traded for 10 trading days.

Notwithstanding the foregoing, with respect to any “stock right” within the meaning of Section 409A
of the Code, Fair Market Value shall not be less than the “fair market value” of the shares of
Common Stock determined in accordance with the final regulations promulgated under Section 409A of
the Code.

     “Grant” shall mean the issuance of an Incentive Stock Option, Non-qualified Stock Option,
Restricted Stock, Phantom Share, DER, other equity-based grant as contemplated herein or any
combination thereof as applicable to an Eligible Person. The Committee will determine the
eligibility of

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personnel, employees, officers, directors and others expected to provide significant services
to the Participating Companies based on, among other factors, the position and responsibilities of
such individuals, the nature and value to the Participating Company of such individuals’
accomplishments and potential contribution to the success of the Participating Company whether
directly or through its subsidiaries.

     “Grantee” shall mean an Eligible Person to whom Options, Restricted Stock, Phantom Shares,
DERs, or other equity-based awards are granted hereunder.

     “Incentive Stock Option” shall mean an Option of the type described in Section 422(b) of the
Code issued to an Employee of (i) the Company, or (ii) a “subsidiary corporation” or a “parent
corporation” as defined in Section 424(f) of the Code.

     “Manager” shall mean PMF Advisors, LLC, the Company’s manager.

     “Non-qualified Stock Option” shall mean an Option not described in Section 422(b) of the Code.

     “Option” shall mean any option, whether an Incentive Stock Option or a Non-qualified Stock
Option, to purchase, at a price and for the term fixed by the Committee in accordance with the
Plan, and subject to such other limitations and restrictions in the Plan and the applicable Award
Agreement, a number of Shares determined by the Committee.

     “Optionee” shall mean any Eligible Person to whom an Option is granted, or the Successors of
the Optionee, as the context so requires.

     “Participating Companies” shall mean the Company, the Subsidiaries, the Manager and any of
their respective affiliates, and any joint venture affiliate of the Company which with the consent
of the Board participates in the Plan.

     “Performance Goals” has the meaning set forth in Section 13.

     “Phantom Share” shall mean a right, pursuant to the Plan, of the Grantee to payment of the
Phantom Share Value in accordance with Section 10.

     “Phantom Share Value,” per Phantom Share, shall mean the Fair Market Value of a Share or, if
so provided by the Committee, such Fair Market Value to the extent in excess of a base value
established by the Committee at the time of grant.

     “Plan” shall mean the Company’s 2011 Equity Incentive Plan, as set forth herein, and as the
same may from time to time be amended.

     “Purchase Price” shall mean the Exercise Price times the number of Shares with respect to
which an Option is exercised.

     “Restricted Stock” shall mean an award of Shares that are subject to restrictions hereunder.

     “Shares” shall mean shares of Common Stock of the Company, adjusted in accordance with Section
15 of the Plan (if applicable).

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     “Subsidiary” shall mean any corporation, partnership, limited liability company or other
entity at least 50% of the economic interest in the equity of which is owned, directly or
indirectly, by the Company or by another subsidiary.

     “Successors of the Optionee” shall mean the legal representative of the estate of a deceased
Optionee or the person or persons who shall acquire the right to exercise an Option by bequest or
inheritance or by reason of the death of the Optionee.

     “Termination of Service” shall mean the time when the employee-employer relationship or
directorship, or other service relationship (sufficient to constitute service as an Eligible
Person), between the Grantee and the Participating Companies is terminated for any reason, with or
without Cause, including, but not limited to, any termination by resignation, discharge, death or
Retirement; provided, however, Termination of Service shall not include a termination where there
is a simultaneous continuation of service of the Grantee (sufficient to constitute service as an
Eligible Person) for a Participating Company. The Committee, in its absolute discretion, shall
determine the effects of all matters and questions relating to Termination of Service, including,
but not limited to, the question of whether any Termination of Service was for Cause and all
questions of whether particular leaves of absence constitute Terminations of Service. For this
purpose, the service relationship shall be treated as continuing intact while the Grantee is on
military leave, sick leave or other bona fide leave of absence (to be determined in the discretion
of the Committee).

3. EFFECTIVE DATE. The effective date of the Plan is _____ __, 2011. The Plan shall not
become effective unless and until it is approved by the requisite percentage of the holders of the
Common Stock of the Company. The Plan shall terminate on, and no Grant shall be awarded hereunder
on or after, the 10-year anniversary of the approval of the Plan by the Board.

4. ADMINISTRATION.

     (a) Membership on Committee. The Plan shall be administered by the Committee appointed by the
Board. If no Committee is designated by the Board to act for those purposes or the Board otherwise
so elects, the full Board shall have the rights and responsibilities of the Committee hereunder and
under the Award Agreements.

     (b) Committee Meetings. The acts of a majority of the members present at any meeting of the
Committee at which a quorum is present, or acts approved in writing by a majority of the entire
Committee, shall be the acts of the Committee for purposes of the Plan. If and to the extent
applicable, no member of the Committee may act as to matters under the Plan specifically relating
to such member.

     (c) Grant of Awards. The Committee shall from time to time at its discretion select the
Eligible Persons who are to be issued Grants and determine the number and type of Grants to be
issued under any Award Agreement to an Eligible Person. In particular, the Committee shall (A)
determine the terms and conditions, not inconsistent with the terms of the Plan, of any Grants
awarded hereunder (including, but not limited to the performance goals and periods applicable to
the award of Grants); (B) determine the time or times when and the manner and condition in which
each Option shall be exercisable and the duration of the exercise period; and (C) determine or
impose other conditions to the Grant or exercise of Options under the Plan as it may deem
appropriate. The Committee may establish such rules, regulations and procedures for the
administration of the Plan as it deems appropriate, determine the extent, if any, to which Options,
Phantom Shares, Shares (whether or not Shares of Restricted Stock), DERs or other equity-based
awards shall be forfeited (whether or not such forfeiture is expressly contemplated hereunder), and
take any other actions and make any other determinations or decisions that it deems necessary or
appropriate in connection with the Plan or the administration or

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interpretation thereof. The
Committee shall also cause each Incentive Stock Option to be designated as such, except that
no Incentive Stock Options may be granted to an Eligible Person who is not an Employee of the
Company or a “subsidiary corporation” or a “parent corporation” as defined in Section 424(f) of the
Code. The Grantee shall take whatever additional actions and execute whatever additional documents
the Committee may in its reasonable judgment deem necessary or advisable in order to carry or
effect one or more of the obligations or restrictions imposed on the Grantee pursuant to the
express provisions of the Plan and the Award Agreement. DERs will be exercisable separately or
together with Options, and paid in cash or other consideration at such times and in accordance with
such rules, as the Committee shall determine in its discretion. Unless expressly provided
hereunder, the Committee, with respect to any Grant, may exercise its discretion hereunder at the
time of the award or thereafter. The Committee shall have the right and responsibility to
interpret the Plan and the interpretation and construction by the Committee of any provision of the
Plan or of any Grant thereunder, including, without limitation, in the event of a dispute, shall be
final and binding on all Grantees and other persons to the maximum extent permitted by law.
Without limiting the generality of Section 24, no member of the Committee shall be liable for any
action or determination made in good faith with respect to the Plan or any Grant hereunder.

	 	(d)	 	Awards.

	 	(i)	 	Agreements. Grants to Eligible Persons shall be evidenced by
written Award Agreements in such form as the Committee shall from time to time
determine (which Award Agreements need not be in the same form as any other
Award Agreement evidencing Grants under the Plan and need not contain terms and
conditions identical to those applicable to any other Grant under the Plan or
to those applicable to any other Eligible Persons). Such Award Agreements
shall comply with and be subject to the terms and conditions set forth below.

	 	(ii)	 	Number of Shares. Each Grant issued to an Eligible Person
shall state the number of Shares to which it pertains or which otherwise
underlie the Grant and shall provide for the adjustment thereof in accordance
with the provisions of Section 15 hereof.

	 	(iii)	 	Grants. Subject to the terms and conditions of the Plan and
consistent with the Company’s intention for the Committee to exercise the
greatest permissible flexibility under Rule 16b-3 under the Exchange Act in
awarding Grants, the Committee shall have the power:

	 	(1)	 	to determine from time to time the Grants to be
issued to Eligible Persons under the Plan and to prescribe the terms
and provisions (which need not be identical) of Grants issued under the
Plan to such persons;
	 
	 	(2)	 	to construe and interpret the Plan and the
Grants thereunder and to establish, amend and revoke the rules,
regulations and procedures established for the 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 any
Award 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
Participating Companies and the Grantees;

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	 	(3)	 	to amend any outstanding Grant, subject to
Section 17, and to accelerate or extend the vesting or exercisability
of any Grant (in compliance with Section 409A of the Code, if
applicable) and to waive conditions or restrictions on any Grants, to
the extent it shall deem appropriate;
	 
	 	(4)	 	to determine the circumstances, if any, upon
which an award made under the Plan shall be subject to forfeiture in
whole or in part as a result of a breach by the Grantee of a provision
or covenant to which the Grantee is subject; and
	 
	 	(5)	 	generally to exercise such powers and to
perform such acts as are deemed necessary or expedient to promote the
best interests of the Company with respect to the Plan.

5. PARTICIPATION.

     (a) Eligibility. Only Eligible Persons shall be eligible to receive Grants under the Plan.

     (b) Limitation of Ownership. No Grants shall be issued under the Plan to any person who after
such Grant would beneficially own more than 9.8% of the outstanding shares of Common Stock of the
Company or to the extent such Grant would otherwise be in violation of the Articles of
Incorporation of the Company, unless such restriction or violation is expressly and specifically
waived by action of the independent directors of the Board.

     (c) Stock Ownership. For purposes of Section 5(b) above, in determining stock ownership a
Grantee shall be considered as owning the stock owned, directly or indirectly, by or for his
brothers, sisters, spouses, ancestors and lineal descendants. Stock owned, directly or indirectly,
by or for a corporation, partnership, estate or trust shall be considered as being owned
proportionately by or for its stockholders, partners or beneficiaries. Stock with respect to which
any person holds an Option shall be considered to be owned by such person.

     (d) Outstanding Stock. For purposes of Section 5(b) above, “outstanding shares” shall include
all stock actually issued and outstanding immediately after the issue of the Grant to the Grantee.
With respect to the stock ownership of any Grantee, “outstanding shares” shall include shares
authorized for issue under outstanding Options held by such Grantee, but not options held by any
other person.

6. STOCK. Subject to adjustments pursuant to Section 15, Grants with respect to an
aggregate of no more than ______ Shares may be granted under the Plan; provided, that no Grant may
cause the total number of shares of Common Stock subject to all
outstanding awards to exceed 3%
of the issued and outstanding shares of Common Stock on a fully diluted basis and including shares
of Common Stock sold to the Company in the concurrent private placement and pursuant to the
underwriters’ exercise of their overallotment option (assuming, if applicable, the exercise of all
outstanding Options and the conversion of all warrants and convertible securities into shares of
Common Stock). Subject to adjustments pursuant to Section 15, (i) the maximum number of Shares
with respect to which any Options may be granted in any one year to any Grantee shall not exceed
______, (ii) the maximum number of Shares that may underlie Grants, other than Grants of Options,
in any one year to any Grantee shall not exceed ______ and (iii) the maximum number of Shares with
respect to which Incentive Stock Options may be granted over the life of the Plan shall not exceed
_____. Notwithstanding the first sentence of this Section 6, (i) Shares that have been granted as
Restricted Stock or that have been reserved for distribution in payment for Options or Phantom
Shares but are later forfeited or for any other reason are not payable under the Plan; and (ii)
Shares as to which an Option is granted under the

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 Plan that remains unexercised at the expiration, forfeiture or other termination of such Option,
may be the subject of the issue of further Grants. Shares of Common Stock issued hereunder may
consist, in whole or in part, of authorized and unissued shares, treasury shares or previously
issued Shares under the Plan. The certificates for Shares issued hereunder may include any legend
which the Committee deems appropriate to reflect any restrictions on transfer hereunder or under
the Award Agreement, or as the Committee may otherwise deem appropriate. Shares subject to DERs,
other than DERs based directly on the dividends payable with respect to Shares subject to Options
or the dividends payable on a number of Shares corresponding to the number of Phantom Shares
awarded, shall be subject to the limitation of this Section 6. Notwithstanding the limitations
above in this Section 6, except in the case of Grants intended to qualify for relief from the
limitations of Section 162(m) of the Code, there shall be no limit on the number of Phantom Shares
or DERs to the extent they are paid out in cash that may be granted under the Plan. If any
Phantom Shares or DERs are paid out in cash, the underlying Shares may again be made the subject
of Grants under the Plan, notwithstanding the first sentence of this Section 6.

7. TERMS AND CONDITIONS OF OPTIONS.

     (a) Each Award Agreement with an Eligible Person shall state the Exercise Price. The Exercise
Price for any Option shall not be less than the Fair Market Value on the date of Grant.

     (b) Medium and Time of Payment. Except as may otherwise be provided below, the Purchase Price
for each Option granted to an Eligible Person shall be payable in full in United States dollars
upon the exercise of the Option. In the event the Company determines that it is required to
withhold taxes as a result of the exercise of an Option, as a condition to the exercise thereof, an
Employee may be required to make arrangements satisfactory to the Company to enable it to satisfy
such withholding requirements in accordance with Section 21. If the applicable Award Agreement so
provides, or the Committee otherwise so permits, the Purchase Price may be paid in one or a
combination of the following, taking into account the desired accounting treatment and compliance
with applicable law:

	 	(i)	 	by a certified or bank cashier’s check;
	 
	 	(ii)	 	by the surrender of shares of Common Stock in good form for
transfer, owned by the person exercising the Option and having a Fair Market
Value on the date of exercise equal to the Purchase Price, or in any
combination of cash and shares of Common Stock, as long as the sum of the cash
so paid and the Fair Market Value of the shares of Common Stock so surrendered
equals the Purchase Price;
	 
	 	(iii)	 	by reduction of the Shares issuable upon exercise of the
Option;
	 
	 	(iv)	 	by cancellation of indebtedness owed by the Company to the
Grantee;
	 
	 	(v)	 	subject to Section 17(e) and as applicable, by broker-assisted
cashless exercise using a broker reasonably acceptable to the Company, pursuant
to which the Grantee delivers to the Company, on or prior to the exercise date,
the Grantee’s instruction directing and obligating the broker to (a) sell
Shares (or a sufficient portion of the Shares) acquired upon exercise of the
Option and (b) remit to the Company a sufficient portion of the sale proceeds
to pay the aggregate purchase price, no later than the third trading day after
the exercise date;
	 
	 	(vi)	 	subject to Section 17(e), by a loan or extension of credit from
the Company evidenced by a full recourse promissory note executed by the
Grantee. The interest rate and other terms and conditions of such note shall
be determined by

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	 	 	 	the Committee (in which case the Committee may require that the Grantee
pledge his or her Shares to the Company for the purpose of securing the
payment of such note, and in no event shall the stock certificate(s)
representing such Shares be released to the Grantee until such note shall
have been paid in full); or
	 
	 	(vii)	 	by any combination of such methods of payment or any other
method acceptable to the Committee in its discretion.

Except in the case of Options exercised by certified or bank cashier’s check, the Committee may
impose such limitations and prohibitions on the exercise of Options as it deems appropriate,
including, without limitation, any limitation or prohibition designed to avoid accounting
consequences which may result from the use of Common Stock as payment upon exercise of an Option.
Any fractional shares of Common Stock resulting from a Grantee’s election that are accepted by the
Company shall in the discretion of the Committee be paid in cash.

     (c) Term and Nontransferability of Grants and Options.

	 	(i)	 	Each Option under this Section 7 shall state the time or times
which all or part thereof becomes exercisable, subject to the restrictions set
forth in clauses (ii) through (v) below.
	 
	 	(ii)	 	No Option shall be exercisable except by the Grantee or a
transferee permitted hereunder.
	 
	 	(iii)	 	No Option shall be assignable or transferable, except by will
or the laws of descent and distribution of the state wherein the Grantee is
domiciled at the time of his death; provided, however, that the Committee may
(but need not) permit other transfers, where the Committee concludes that such
transferability (i) does not result in accelerated taxation, (ii) does not
cause any Option intended to be an Incentive Stock Option to fail to be
described in Section 422(b) of the Code and (iii) is otherwise appropriate and
desirable.
	 
	 	(iv)	 	The Committee shall provide in the Award Agreement the terms
upon which an Option shall be exercisable (but in no event shall an Option be
exercisable after the expiration of such Grant).
	 
	 	(v)	 	No modification of an Option shall, without the consent of the
Optionee or as required by applicable law or regulation or to meet the
requirements of any accounting standard or to correct an administrative error,
materially impair the rights of an Optionee under any Option previously
granted.

     (d) Exercisability Upon and After Termination of Service. The Committee shall provide in the
Award Agreement the extent (if any) to which an Option may be exercised upon and after the death,
Disability or Termination of Service of the Optionee.

     (e) Rights as a Stockholder. An Optionee, a Successor of the Optionee, or the holder of a DER
shall have no rights as a stockholder with respect to any Shares covered by his or her Grant until,
in the case of an Optionee, the date of the issuance of a stock certificate for such Shares. No
adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or
other property), distributions or other rights for which the record date is prior to the date such
stock certificate is issued, except as provided in Section 15.

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     (f) Modification, Extension and Renewal of Option. Within the limitations of the Plan, and
only with respect to Options granted to Eligible Persons, the Committee may modify, extend or renew
outstanding Options or accept the cancellation of outstanding Options (to the extent not previously
exercised) for the granting of new Options in substitution therefor (but not including repricings,
in the absence of stockholder approval). The Committee may modify, extend or renew any Option
granted to any Eligible Person, taking into consideration Rule 16b-3 under the Exchange Act and
Section 409A of the Code. The foregoing notwithstanding, no modification of an Option shall,
without the consent of the Optionee, alter or impair any rights or obligations under any Option
previously granted.

     (g) Stock Appreciation Rights. The Committee, in its discretion, may (taking into account,
without limitation, the application of Section 409A of the Code, as the Committee may deem
appropriate), also permit the Optionee to elect to exercise an Option by receiving Shares, cash or
a combination thereof, in the discretion of the Committee and as may be set forth in the applicable
Award Agreement, with an aggregate Fair Market Value (or, to the extent of payment in cash, in an
amount) equal to the excess of the Fair Market Value of the Shares with respect to which the Option
is being exercised over the aggregate Purchase Price, as determined as of the day the Option is
exercised.

     (h) Deferral. The Committee may establish a program (taking into account, without limitation,
the application of Section 409A of the Code, as the Committee may deem appropriate) under which
Optionees will have Phantom Shares subject to Section 10 credited upon their exercise of Options,
rather than receiving Shares at that time.

     (i) Other Provisions. The Award Agreement authorized under the Plan may contain such other
provisions not inconsistent with the terms of the Plan (including, without limitation, restrictions
upon the exercise of the Option) as the Committee shall deem advisable.

8. SPECIAL RULES FOR INCENTIVE STOCK OPTIONS.

     (a) In the case of Incentive Stock Options granted hereunder, the aggregate Fair Market Value
(determined as of the date of the Grant thereof) of the Shares with respect to which Incentive
Stock Options become exercisable by any Optionee for the first time during any calendar year (under
the Plan and all other plans) required to be taken into account under Section 422(d) of the Code
shall not exceed $100,000.

     (b) In the case of an individual described in Section 422(b)(6) of the Code (relating to
certain 10% owners), the Exercise Price with respect to an Incentive Stock Option shall not be less
than 110% of the Fair Market Value of a Share on the day the Option is granted and the term of an
Incentive Stock Option shall be no more than five years from the date of grant.

     (c) If Shares acquired upon exercise of an Incentive Stock Option are disposed of in a
disqualifying disposition within the meaning of Section 422 of the Code by an Optionee prior to the
expiration of either two years from the date of grant of such Option or one year from the transfer
of Shares to the Optionee pursuant to the exercise of such Option, or in any other disqualifying
disposition within the meaning of Section 422 of the Code, such Optionee shall notify the Company
in writing as soon as practicable thereafter of the date and terms of such disposition and, if the
Company thereupon has a tax-withholding obligation, shall pay to the Company an amount equal to any
withholding tax the Company is required to pay as a result of the disqualifying disposition.

- 10 -

 

9. PROVISIONS APPLICABLE TO RESTRICTED STOCK.

     (a) Vesting Periods. In connection with the grant of Restricted Stock, whether or not
Performance Goals apply thereto, the Committee shall establish one or more vesting periods with
respect to the shares of Restricted Stock granted, the length of which shall be determined in the
discretion of the Committee and set forth in the applicable Award Agreement. Subject to the
provisions of this Section 9, the applicable Award Agreement and the other provisions of the Plan,
restrictions on Restricted Stock shall lapse if the Grantee satisfies all applicable employment or
other service requirements through the end of the applicable vesting period.

     (b) Grant of Restricted Stock. Subject to the other terms of the Plan, the Committee may, in
its discretion as reflected by the terms of the applicable Award Agreement: (i) authorize the
granting of Restricted Stock to Eligible Persons; (ii) provide a specified purchase price for the
Restricted Stock (whether or not the payment of a purchase price is required by any state law
applicable to the Company); (iii) determine the restrictions applicable to Restricted Stock and
(iv) determine or impose other conditions to the grant of Restricted Stock under the Plan as it may
deem appropriate.

     (c) Certificates.

	 	(i)	 	Each Grantee of Restricted Stock may be issued a stock
certificate in respect of Shares of Restricted Stock awarded under the Plan.
Any such certificate shall be registered in the name of the Grantee. Without
limiting the generality of Section 6, in addition to any legend that might
otherwise be required by the Board or the Company’s charter, bylaws or other
applicable documents, the certificates for Shares of Restricted Stock issued
hereunder may include any legend which the Committee deems appropriate to
reflect any restrictions on transfer hereunder or under the applicable Award
Agreement, or as the Committee may otherwise deem appropriate, and, without
limiting the generality of the foregoing, shall bear a legend referring to the
terms, conditions, and restrictions applicable to such Grant, substantially in
the following form:
	 
	                                                       
	 	 	 	THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED
HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING FORFEITURE) OF THE
PROVIDENT MORTGAGE CAPITAL ASSOCIATES, INC. 2011 EQUITY INCENTIVE PLAN, AND
AN AWARD AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND PROVIDENT
MORTGAGE CAPITAL ASSOCIATES, INC. COPIES OF SUCH PLAN AND AWARD AGREEMENT
ARE ON FILE IN THE OFFICES OF PROVIDENT MORTGAGE CAPITAL ASSOCIATES, INC. AT
1633 BAYSHORE HIGHWAY, SUITE 331 BURLINGAME, CALIFORNIA 94010.
	                                                        
	 
	 	(ii)	 	The Committee may require that any stock certificates
evidencing such Shares be held in custody by the Company until the restrictions
hereunder shall have lapsed and that, as a condition of any grant of Restricted
Stock, the Grantee shall have delivered a stock power, endorsed in blank,
relating to the stock covered by such Grant. If and when such restrictions so
lapse, the stock certificates shall be delivered by the Company to the Grantee
or his or her designee as provided in Section 9(d).

- 11 -

 

	 	(iii)	 	For purposes of clarity, nothing contained in the Plan shall
preclude the use of non-certificated evidence of ownership that the Committee
determines to be appropriate, including book entry.

     (d) Restrictions and Conditions. Unless otherwise provided by the Committee in an Award
Agreement, the Shares of Restricted Stock awarded pursuant to the Plan shall be subject to the
following restrictions and conditions:

	 	(i)	 	Subject to the provisions of the Plan and the applicable Award
Agreement, during a period commencing with the date of such Grant and ending on
the date the period of forfeiture with respect to such Shares lapses, the
Grantee shall not be permitted voluntarily or involuntarily to sell, transfer,
pledge, anticipate, alienate, encumber or assign Shares of Restricted Stock
awarded under the Plan (or have such Shares attached or garnished). Subject to
the provisions of the applicable Award Agreement and clauses (iii) and (iv)
below, the period of forfeiture with respect to Shares granted hereunder shall
lapse as provided in the applicable Award Agreement. Notwithstanding the
foregoing, unless otherwise expressly provided by the Committee, the period of
forfeiture with respect to such Shares shall only lapse as to whole Shares.
	 
	 	(ii)	 	Except as provided in the foregoing clause (i), or in Section
15, and subject to the applicable Award Agreement, the Grantee shall have, in
respect of the Shares of Restricted Stock, all of the rights of a stockholder
of the Company, including the right to vote the Shares and the right to receive
any cash dividends; provided, however, that whether any such dividends paid or
made on such Shares will be automatically deferred or reinvested in additional
Shares of Restricted Stock and held subject to forfeiture under certain terms
and conditions shall be provided in the applicable Award Agreement.
Notwithstanding the foregoing, except as otherwise provided in the applicable
Award Agreement, with respect to awards of Shares of Restricted Stock that are
subject to the achievement of certain performance criteria, the Grantee shall
only receive the cash dividends paid on a Share of Restricted Stock during the
period of forfeiture with respect to such Share at the time the applicable
period of forfeiture lapses (if any). Certificates, if any, for Shares (not
subject to restrictions hereunder) shall be delivered to the Grantee or his or
her designee (or where permitted, transferee) promptly after, and only after,
the period of forfeiture shall lapse without forfeiture in respect of such
Shares of Restricted Stock.
	 
	 	(iii)	 	The Company shall provide in the Award Agreement the extent to
which all Shares of Restricted Stock still subject to restriction shall lapse
upon the occurrence of death, Disability or Termination of Service of the
Grantee during the applicable period of forfeiture. If Shares of Restriction
Stock during the applicable period of forfeiture are forfeited by the Grantee,
the Company shall pay to the Grantee as soon as practicable (and in no event
more than 30 days) after such termination an amount equal to the lesser of (x)
the amount (if any) paid by the Grantee for such forfeited Restricted Stock as
contemplated by Section 9(b), and (y) the Fair Market Value on the date of
termination of the forfeited Restricted Stock.

- 12 -

 

10. PROVISIONS APPLICABLE TO PHANTOM SHARES.

     (a) Grant of Phantom Shares. Subject to the other terms of the Plan, the Committee shall, in
its discretion as reflected by the terms of the applicable Award Agreement: (i) authorize the
Granting of Phantom Shares to Eligible Persons and (ii) determine or impose other conditions to the
grant of Phantom Shares under the Plan as it may deem appropriate.

     (b) Term. The Committee may provide in an Award Agreement that any particular Phantom Share
shall expire at the end of a specified term.

     (c) Vesting. Phantom Shares shall vest as provided in the applicable Award Agreement.

     (d) Settlement of Phantom Shares.

	 	(i)	 	Except as otherwise provided by the Committee, each vested and
outstanding Phantom Share shall be settled by the transfer to the Grantee of
one Share; provided, however, that, the Committee at the time of grant (or, in
the appropriate case, as determined by the Committee, thereafter) may provide
that, after consideration of possible accounting issues, a Phantom Share may be
settled (A) in cash at the applicable Phantom Share Value, (B) in cash or by
transfer of Shares as elected by the Grantee in accordance with procedures
established by the Committee (if any) or (C) in cash or by transfer of Shares
as elected by the Company.
	 
	 	(ii)	 	Except as otherwise provided by the Committee, each Phantom
Share shall be settled with a single-sum payment by the Company; provided,
however, that, with respect to Phantom Shares of a Grantee which have a common
Settlement Date (as defined below), the Committee may permit the Grantee to
elect in accordance with procedures established by the Committee (taking into
account, without limitation, Section 409A of the Code, as the Committee may
deem appropriate) to receive installment payments over a period not to exceed
10 years, rather than a single sum payment. If the Grantee’s Phantom Shares
are paid out in installment payments, such installment payments shall be
treated as a series of separate payments for purposes of Section 409A of the
Code.

	 	(iii)	 	(1)	 	 Unless otherwise provided in the applicable Award
Agreement, the settlement date with respect to a Grantee is the first day of
the month to follow the date on which the Phantom Share vests (“Settlement
Date”); provided, however, that a Grantee may elect, in accordance with
procedures to be adopted by the Committee, that such Settlement Date will be
deferred as elected by the Grantee to such other time as may be permitted by
the Committee. Notwithstanding the prior sentence, initial elections to defer
the Settlement Date shall be made in accordance with the requirements of
Section 409A of the Code. In addition, unless otherwise determined by the
Committee, amended elections under this Section 10(d)(iii)(1) must, except as
may otherwise be permitted under the rules applicable under Section 409A of the
Code, (A) not be effective for at least one year after they are made, or, in
the case of payments to commence at a specific time, be made at least one year
before the first scheduled payment, and (B) defer the commencement of
distributions (and each affected distribution) for at least five years.

- 13 -

 

	 	(2)	 	Notwithstanding Section 10(d)(iii)(1), the
Committee may provide that distributions of Phantom Shares can be
elected at any time in those cases in which the Phantom Share Value is
determined by reference to Fair Market Value to the extent in excess of
a base value, rather than by reference to unreduced Fair Market Value.
	 
	 	(3)	 	Notwithstanding the foregoing, the Settlement
Date, if not earlier pursuant to this Section 10(d)(iii), is the date
of the Grantee’s death.

	 	(iv)	 	Notwithstanding any other provision of the Plan (taking into
account, without limitation, Section 409A of the Code, as the Committee may
deem appropriate), at the sole discretion of the Committee, a Grantee may
receive any amounts to be paid in installments as provided in Section 10(d)(ii)
or deferred by the Grantee as provided in Section 10(d)(iii) in the event of an
“Unforeseeable Emergency.” For these purposes, an “Unforeseeable Emergency,”
as determined by the Committee (taking into account, without limitation,
Section 409A of the Code, as the Committee may deem appropriate) in its sole
discretion, is a severe financial hardship to the Grantee resulting from (x) a
sudden and unexpected illness or accident of the Grantee or “dependent,” as
defined in Section 152(a) of the Code, of the Grantee, (y) loss of the
Grantee’s property due to casualty, or (z) other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Grantee. The circumstances that will constitute an Unforeseeable Emergency
will depend upon the facts of each case, but, in any case, payment may not be
made to the extent that such hardship is or may be relieved:

	 	(1)	 	through reimbursement or compensation by
insurance or otherwise;
	 
	 	(2)	 	by liquidation of the Grantee’s assets, to the
extent the liquidation of such assets would not itself cause severe
financial hardship; or
	 
	 	(3)	 	by future cessation of the making of additional
deferrals under Section 10(d)(ii) and (iii).

     (e) Other Phantom Share Provisions.

	 	(i)	 	Except as permitted by the Committee, rights to payments with
respect to Phantom Shares granted under the Plan shall not be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment, garnishment, levy, execution, or other legal or
equitable process, either voluntary or involuntary; and any attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber, attach or
garnish, or levy or execute on any right to payments or other benefits payable
hereunder, shall be void.
	 
	 	(ii)	 	A Grantee may designate in writing, on forms to be prescribed
by the Committee, a beneficiary or beneficiaries to receive any payments
payable after his or her death and may amend or revoke such designation at any
time. If no beneficiary designation is in effect at the time of a Grantee’s
death, payments hereunder shall be made to the Grantee’s estate. If a Grantee
with a vested Phantom Share dies, such Phantom Share shall be settled and the
Phantom Share Value in respect of such Phantom Shares paid, and any payments
deferred pursuant to an election

- 14 -

 

	 	 	 	under Section 10(d)(iii) shall be accelerated and paid, as soon as
practicable (but no later than 60 days) after the date of death to such
Grantee’s beneficiary or estate, as applicable.

	 	(iii)	 	The Committee may (taking into account, without limitation,
Section 409A of the Code, as the Committee may deem appropriate) establish a
program under which distributions with respect to Phantom Shares may be
deferred for periods in addition to those otherwise contemplated by the
foregoing provisions of this Section 10. Such program may include, without
limitation, provisions for the crediting of earnings and losses on unpaid
amounts and, if permitted by the Committee, provisions under which Grantees may
select from among hypothetical investment alternatives for such deferred
amounts in accordance with procedures established by the Committee.
	 
	 	(iv)	 	Notwithstanding any other provision of this Section 10, any
fractional Phantom Share will be paid out in cash at the Phantom Share Value as
of the Settlement Date.
	 
	 	(v)	 	No Phantom Share shall give any Grantee any rights with respect
to Shares or any ownership interest in the Company. Except as may be provided
in accordance with Section 11, no provision of the Plan shall be interpreted to
confer upon any Grantee of a Phantom Share any voting, dividend or derivative
or other similar rights with respect to any Phantom Share.

     (f) Claims Procedures.

	 	(i)	 	The Grantee, or his beneficiary hereunder or authorized
representative, may file a claim for payments with respect to Phantom Shares
under the Plan by written communication to the Committee or its designee. A
claim is not considered filed until such communication is actually received.
Within 90 days (or, if special circumstances require an extension of time for
processing, 180 days, in which case notice of such special circumstances should
be provided within the initial 90-day period) after the filing of the claim,
the Committee will either:

	 	(1)	 	approve the claim and take appropriate steps
for satisfaction of the claim; or
	 
	 	(2)	 	if the claim is wholly or partially denied,
advise the claimant of such denial by furnishing to him or her a
written notice of such denial setting forth (A) the specific reason or
reasons for the denial; (B) specific reference to pertinent provisions
of the Plan on which the denial is based and, if the denial is based in
whole or in part on any rule of construction or interpretation adopted
by the Committee, a reference to such rule, a copy of which shall be
provided to the claimant; (C) a description of any additional material
or information necessary for the claimant to perfect the claim and an
explanation of the reasons why such material or information is
necessary; and (D) a reference to this Section 10(f) as the provision
setting forth the claims procedure under the Plan.

	 	(ii)	 	The claimant may request a review of any denial of his or her
claim by written application to the Committee within 60 days after receipt of
the notice of denial

- 15 -

 

	 	 	 	of such claim. Within 60 days (or, if special circumstances require an
extension of time for processing, 120 days, in which case notice of such
special circumstances should be provided within the initial 60-day period)
after receipt of written application for review, the Committee will provide
the claimant with its decision in writing, including, if the claimant’s
claim is not approved, specific reasons for the decision and specific
references to the Plan provisions on which the decision is based.

11. PROVISIONS APPLICABLE TO DIVIDEND EQUIVALENT RIGHTS.

     (a) Grant of DERs. Subject to the other terms of the Plan, the Committee shall, in its
discretion as reflected by the terms of the Award Agreements, authorize the granting of DERs to
Eligible Persons based on the dividends declared on Common Stock, to be credited as of the dividend
payment dates, during the period between the date a Grant is issued, and the date such Grant is
exercised, vests or expires, as determined by the Committee. Such DERs shall be converted to cash
or additional Shares by such formula and at such time and subject to such limitation as may be
determined by the Committee. With respect to DERs granted with respect to Options intended to be
qualified performance-based compensation for purposes of Section 162(m) of the Code, such DERs
shall be payable regardless of whether such Option is exercised. If a DER is granted in respect of
another Grant hereunder, then, unless otherwise stated in the Award Agreement, or, in the
appropriate case, as determined by the Committee, in no event shall the DER be in effect for a
period beyond the time during which the applicable related portion of the underlying Grant has been
exercised or otherwise settled, or has expired, been forfeited or otherwise lapsed, as applicable.

     (b) Certain Terms.

	 	(i)	 	The term of a DER shall be set by the Committee in its
discretion.
	 
	 	(ii)	 	Payment of the amount determined in accordance with Section
11(a) shall be in cash, in Common Stock or after consideration of possible
accounting issues, a combination of the both, as determined by the Committee at
the time of grant.

     (c) Other Types of DERs. The Committee may establish a program under which DERs of a type
whether or not described in the foregoing provisions of this Section 11 may be granted to Eligible
Persons. For example, without limitation, the Committee may grant a DER in respect of each Share
subject to an Option or with respect to a Phantom Share, which right would consist of the right
(subject to Section 11(d)) to receive a cash payment in an amount equal to the dividend
distributions paid on a Share from time to time.

     (d) Deferral.

	 	(i)	 	The Committee may (taking into account, without limitation,
Section 409A of the Code, as the Committee may deem appropriate) establish a
program under which Grantees (i) will have Phantom Shares credited, subject to
the terms of Sections 10(d) and 10(e) as though directly applicable with
respect thereto, upon the granting of DERs, or (ii) will have payments with
respect to DERs deferred.

	 	(ii)	 	The Committee may establish a program under which distributions
with respect to DERs may be deferred. Such program may include, without
limitation, provisions for the crediting of earnings and losses on unpaid
amounts, and, if permitted by the Committee, provisions under which Grantees
may select from

- 16 -

 

	 	 	 	among hypothetical investment alternatives for such deferred amounts in
accordance with procedures established by the Committee.

	12.	 	OTHER EQUITY-BASED AWARDS. The Board shall have the right to grant other awards based
upon the Common Stock having such terms and conditions as the Board may determine, including,
without limitation, the grant of Shares based upon certain conditions and the grant of securities
convertible into Common Stock.

	13.	 	PERFORMANCE GOALS. The Committee, in its discretion, shall in the case of Grants
(including, in particular, Grants other than Options) intended to qualify for an exception from
the limitation imposed by Section 162(m) of the Code (“Performance-Based Grants”) (i) establish
one or more performance goals (“Performance Goals”) as a precondition to the issuance or vesting
of Grants, and (ii) provide, in connection with the establishment of the Performance Goals, for
predetermined Grants to those Grantees (who continue to meet all applicable eligibility
requirements) with respect to whom the applicable Performance Goals are satisfied. The
Performance Goals shall be based upon the criteria set forth in Exhibit A hereto which is
hereby incorporated herein by reference as though set forth in full. The Performance Goals shall
be established in a timely fashion such that they are considered preestablished for purposes of
the rules governing performance-based compensation under Section 162(m) of the Code. Prior to the
award of a Performance-Based Grant intended to qualify for an exception from the limitation
imposed by Section 162(m) of the Code, the Committee shall have certified that any applicable
Performance Goals, and other material terms of the Grant, have been satisfied. Performance Goals
which do not satisfy the foregoing provisions of this Section 13 may be established by the
Committee with respect to Grants not intended to qualify for an exception from the limitations
imposed by Section 162(m) of the Code.

	14.	 	TERM OF PLAN. Grants may be granted pursuant to the Plan until the expiration of 10
years from the effective date of the Plan.

	15.	 	RECAPITALIZATION AND CHANGES OF CONTROL.

     (a) Subject to any required action by stockholders and to the specific provisions of Section
16, if (i) the Company shall at any time be involved in a merger, consolidation, dissolution,
liquidation, reorganization, exchange of shares, sale of all or substantially all of the assets or
stock of the Company or a transaction similar thereto, (ii) any stock dividend, stock split,
reverse stock split, stock combination, reclassification, recapitalization or other similar change
in the capital structure of the Company, or any distribution to holders of Common Stock other than
cash dividends, shall occur or (iii) any other event shall occur which in the judgment of the
Committee necessitates action by way of adjusting the terms of the outstanding Grants, then:

	 	(i)	 	the maximum aggregate number of Shares which may be made
subject to Options and DERs under the Plan, the maximum aggregate number and
kind of Shares of Restricted Stock that may be granted under the Plan, the
maximum aggregate number of Phantom Shares and other Grants which may be
granted under the Plan shall be appropriately adjusted by the Committee in its
discretion; and
	 
	 	(ii)	 	the Committee shall take any such action as in its discretion
shall be necessary to maintain each Grantees’ rights hereunder (including under
their applicable Award Agreements) so that they are, in their respective
Options, Phantom Shares and DERs (and, as appropriate, other Grants under
Section 12), substantially proportionate to the rights existing in such
Options, Phantom Shares and DERs

- 17 -

 

	 	 	 	(and other Grants under Section 12) prior to such event, including, without
limitation, adjustments in (A) the number of Options, Phantom Shares and
DERs (and other Grants under Section 12) granted, (B) the
number and kind of shares or other property to be distributed in respect of Options, Phantom
Shares and DERs (and other Grants under Section 12, as applicable, (C) the
Exercise Price, Purchase Price and Phantom Share Value, and (D)
performance-based criteria established in connection with Grants (to the
extent consistent with Section 162(m) of the Code, as applicable); provided
that, in the discretion of the Committee, the foregoing clause (D) may also
be applied in the case of any event relating to a Subsidiary if the event
would have been covered under this Section 15(a) had the event related to
the Company.

To the extent that such action shall include an increase or decrease in the number of Shares (or
units of other property then available) subject to all outstanding Grants, the number of Shares (or
units) available under Section 6 above shall be increased or decreased, as the case may be,
proportionately.

     (b) Any Shares or other securities distributed to a Grantee with respect to Restricted Stock
or otherwise issued in substitution of Restricted Stock pursuant to this Section 15 shall be
subject to the applicable restrictions and requirements imposed by Section 9, including depositing
the certificates therefor with the Company together with a stock power and bearing a legend as
provided in Section 9(c)(i).

     (c) If the Company shall be consolidated or merged with another corporation or other entity,
each Grantee who has received Restricted Stock that is then subject to restrictions imposed by
Section 9(d) may be required to deposit with the successor corporation the certificates for the
stock or securities or the other property that the Grantee is entitled to receive by reason of
ownership of Restricted Stock in a manner consistent with Section 9(c)(ii), and such stock,
securities or other property shall become subject to the restrictions and requirements imposed by
Section 9(d), and the certificates therefor or other evidence thereof shall bear a legend similar
in form and substance to the legend set forth in Section 9(c)(i).

     (d) The judgment of the Committee with respect to any matter referred to in this Section 15
shall be conclusive and binding upon each Grantee without the need for any amendment to the Plan.

     (e) Subject to any required action by stockholders, if the Company is the surviving
corporation in any merger or consolidation, the rights under any outstanding Grant shall pertain
and apply to the securities to which a holder of the number of Shares subject to the Grant would
have been entitled. Subject to the terms of any applicable Award Agreement, in the event of a
merger or consolidation in which the Company is not the surviving corporation, the date of
exercisability of each outstanding Option and settling of each Phantom Share or, as applicable,
other Grant under Section 12, shall be accelerated to a date prior to such merger or consolidation,
unless the agreement of merger or consolidation provides for the assumption of the Grant by the
successor to the Company.

     (f) To the extent that the foregoing adjustment related to securities of the Company, such
adjustments shall be made by the Committee, whose determination shall be conclusive and binding on
all persons.

     (g) Except as expressly provided in this Section 15, a Grantee shall have no rights by reason
of subdivision or consolidation of shares of stock of any class, the payment of any stock dividend
or any other increase or decrease in the number of shares of stock of any class or by reason of any
dissolution, liquidation, merger or consolidation or spin-off of assets or stock of another
corporation, and any issue by

- 18 -

 

the Company of shares of stock of any class, or securities
convertible into shares of stock of any class,
shall not affect, and no adjustment by reason thereof shall be made with respect to, the
number of Shares subject to a Grant or the Exercise Price of Shares subject to an Option.

     (h) Grants made pursuant to the Plan shall not affect in any way the right or power of the
Company to make adjustments, reclassifications, reorganizations or changes of its capital or
business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any
part of its business assets.

     (i) Upon the occurrence of a Change of Control:

	 	(i)	 	The Committee as constituted immediately before the Change of
Control may make such adjustments as it, in its discretion, determines are
necessary or appropriate in light of the Change of Control (including, without
limitation, the substitution of stock other than stock of the Company as the
stock optioned hereunder, and the acceleration of the exercisability or vesting
of awards granted under the Plan, cancellation of any Options or stock
appreciation rights in return for payment equal to the Fair Market Value of
Shares subject to an Option or stock appreciation right as of the date of the
Change of Control less the exercise price applicable thereto (which amount may
be zero) and settling of each vested Phantom Share or, as applicable, other
Grant under Section 12), if any, provided that the Committee determines that
such adjustments do not have a substantial adverse economic impact on the
Grantee as determined at the time of the adjustments.

	 	(ii)	 	Notwithstanding the provisions of Section 10, the Settlement
Date for Phantom Shares shall be the date of such Change of Control and all
amounts due with respect to Phantom Shares to a Grantee hereunder shall be paid
as soon as practicable (but in no event more than 5 business days) after such
Change of Control, unless such Grantee elects otherwise in accordance with
procedures established by the Committee.

16. EFFECT OF CERTAIN TRANSACTIONS. In the case of (i) the dissolution or liquidation of
the Company, (ii) a merger, consolidation, reorganization or other business combination in which
the Company is acquired by another entity or in which the Company is not the surviving entity, or
(iii) any sale, lease, exchange or other transfer (in one transaction or a series of transactions
contemplated or arranged by any party as a single plan) of all or substantially all of the assets
of the Company, the Plan and the Grants issued hereunder shall terminate upon the effectiveness of
any such transaction or event, unless provision is made in connection with such transaction for
the assumption of Grants theretofore granted, or the substitution for such Grants of new Grants,
by the successor entity or parent thereof, with appropriate adjustment as to the number and kind
of shares and the per share exercise prices, as provided in Section 15. Unless otherwise provided
in the applicable Award Agreement or as the result of the operation of any other provision of the
Plan, in the event of such termination, all outstanding Options and Grants shall be exercisable to
the extent then vested (taking into account any accelerated vested provided by the Committee) for
at least fifteen days prior to the date of such termination.

- 19 -

 

17. SECURITIES LAW REQUIREMENTS.

     (a) Legality of Issuance. The issuance of any Shares pursuant to Grants under the Plan and
the issuance of any Grant shall be contingent upon the following:

	 	(i)	 	the obligation of the Company to sell Shares with respect to
Grants issued under the Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and
the obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Committee;
	 
	 	(ii)	 	the Committee may make such changes to the Plan as may be
necessary or appropriate to comply with the rules and regulations of any
government authority or to obtain tax benefits applicable to stock options; and
	 
	 	(iii)	 	each grant of Options, Restricted Stock, Phantom Shares (or
issuance of Shares in respect thereof), DERs (or issuance of Shares in respect
thereof), or other Grant under Section 12 (or issuance of Shares in respect
thereof), is subject to the requirement that, if at any time the Committee
determines, in its discretion, that the listing, registration or qualification
of Shares issuable pursuant to the Plan is required by any securities exchange
or under any state or federal law, or the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of, or in
connection with, the issuance of Options, Shares of Restricted Stock, Phantom
Shares, DERs, other Grants or other Shares, no payment shall be made, or
Phantom Shares or Shares issued or grant of Restricted Stock or other Grant
made, in whole or in part, unless listing, registration, qualification, consent
or approval has been effected or obtained free of any conditions in a manner
acceptable to the Committee.

     (b) Restrictions on Transfer. Regardless of whether the offering and sale of Shares under the
Plan has been registered under the Act or has been registered or qualified under the securities
laws of any state, the Company may impose restrictions on the sale, pledge or other transfer of
such Shares (including the placement of appropriate legends on stock certificates) if, in the
judgment of the Company and its counsel, such restrictions are necessary or desirable in order to
achieve compliance with the provisions of the Act, the securities laws of any state or any other
law. In the event that the sale of Shares under the Plan is not registered under the Act but an
exemption is available which requires an investment representation or other representation, each
Grantee shall be required to represent that such Shares are being acquired for investment, and not
with a view to the sale or distribution thereof, and to make such other representations as are
deemed necessary or appropriate by the Company and its counsel. Any determination by the Company
and its counsel in connection with any of the matters set forth in this Section 17 shall be
conclusive and binding on all persons. Without limiting the generality of Section 6, stock
certificates evidencing Shares acquired under the Plan pursuant to an unregistered transaction
shall bear a restrictive legend, substantially in the following form, and such other restrictive
legends as are required or deemed advisable under the provisions of any applicable law:

“THE SALE OF THE SECURITIES REPRESENTED HEREBY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”). ANY TRANSFER OF SUCH SECURITIES WILL BE INVALID
UNLESS A REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT AS TO SUCH TRANSFER OR IN
THE OPINION OF COUNSEL FOR THE ISSUER SUCH

- 20 -

 

REGISTRATION IS UNNECESSARY IN ORDER FOR SUCH TRANSFER TO COMPLY WITH THE ACT.”

     (c) Registration or Qualification of Securities. The Company may, but shall not be obligated
to, register or qualify the issuance of Grants and/or the sale of Shares under the Act or any other
applicable law. The Company shall not be obligated to take any affirmative action in order to
cause the issuance of Grants or the sale of Shares under the Plan to comply with any law.

     (d) Exchange of Certificates. If, in the opinion of the Company and its counsel, any legend
placed on a stock certificate representing Shares sold under the Plan is no longer required, the
holder of such certificate shall be entitled to exchange such certificate for a certificate
representing the same number of Shares but lacking such legend.

     (e) Certain Loans. Notwithstanding any other provision of the Plan, the Company shall not be
required to take or permit any action under the Plan or any Award Agreement which, in the
good-faith determination of the Company, would result in a material risk of a violation by the
Company of Section 13(k) of the Exchange Act.

18. COMPLIANCE WITH SECTION 409A OF THE CODE.

     (a) Any Award Agreement issued under the Plan that is subject to Section 409A of the Code
shall include such additional terms and conditions as may be required to satisfy the requirements
of Section 409A of the Code.

     (b) With respect to any Grant issued under the Plan that is subject to Section 409A of the
Code, and with respect to which a payment or distribution is to be made upon a Termination of
Service, (i) the term “Termination of Service” shall be interpreted in a manner consistent with the
definition of “separation of service” under Section 409A and (ii) if the Grantee is determined by
the Company to be a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code
and any of the Company’s stock is publicly traded on an established securities market or otherwise,
such payment or distribution, may not be made before the date which is six months after the date of
Termination of Service (to the extent required under Section 409A of the Code).

     (c) Notwithstanding any other provision of the Plan, the Board and the Committee shall
administer the Plan, and exercise authority and discretion under the Plan, to satisfy the
requirements of Section 409A of the Code or any exemption thereto. Nothing contained herein is
intended to provide assurances or an indemnity to any Grantee regarding his or her personal tax
treatment.

19. AMENDMENT OF THE PLAN. The Board may from time to time, with respect to any Shares at
the time not subject to Grants, suspend or discontinue the Plan or revise or amend it in any
respect whatsoever. The Board may amend the Plan as it shall deem advisable, except that no
amendment may adversely affect a Grantee with respect to Grants previously granted unless such
amendments are in connection with compliance with applicable laws or with the Grantee’s consent;
provided, however, that the Board may not make any amendment in the Plan that would, if such
amendment were not approved by the holders of the Common Stock, cause the Plan to fail to comply
with any requirement of applicable law or regulation, or of any applicable exchange or similar
rule, unless and until the approval of the holders of such Common Stock is obtained.

20. APPLICATION OF FUNDS. The proceeds received by the Company from the sale of Common
Stock pursuant to the exercise of an Option, the sale of Restricted Stock or in connection with
other Grants under the Plan will be used for general corporate purposes.

- 21 -

 

21. TAX WITHHOLDING. Each Grantee shall, no later than the date as of which the value of
any Grant first becomes includable in the gross income of the Grantee for federal income tax
purposes, pay to the Company, or make arrangements satisfactory to the Company regarding payment
of any federal, state or local taxes of any kind that are required by law to be withheld with
respect to such income. To the extent permitted by the Committee from time to time, a Grantee may
elect to have such tax withholding satisfied, in whole or in part, by (i) authorizing the Company
to withhold a number of Shares to be issued pursuant to a Grant equal to the Fair Market Value as
of the date withholding is effected that would satisfy the withholding amount due, (ii)
transferring to the Company Shares owned by the Grantee with a Fair Market Value equal to the
amount of the required withholding tax, or (iii) in the case of a Grantee who is an Employee of
the Company at the time such withholding is effected, by withholding from the Grantee’s cash
compensation. Notwithstanding anything contained in the Plan to the contrary, the Grantee’s
satisfaction of any tax-withholding requirements imposed by the Committee shall be a condition
precedent to the Company’s obligation as may otherwise be provided hereunder to provide Shares to
the Grantee, and the failure of the Grantee to satisfy such requirements with respect to a Grant
shall cause such Grant to be forfeited.

22. NOTICES. All notices under the Plan shall be in writing, and if to the Company, shall
be delivered to the Board or mailed to its principal office (either by first class mail or via
electronic mail), addressed to the attention of the Board; and if to the Grantee, shall be
delivered personally or mailed to the Grantee (either by first class mail or via electronic mail)
at the address appearing in the records of the Participating Company. Such addresses may be
changed at any time by written notice to the other party given in accordance with this Section 22.

23. RIGHTS TO EMPLOYMENT OR OTHER SERVICE. Nothing in the Plan or in any Grant issued
pursuant to the Plan shall confer on any individual any right to continue in the employ or other
service of the Participating Company (if applicable) or interfere in any way with any right the
Participating Company and its stockholders may have under applicable law to terminate the
individual’s employment or other service at any time.

24. EXCULPATION AND INDEMNIFICATION. To the maximum extent permitted by law, the Company
shall indemnify and hold harmless the members of the Board and the members of the Committee, in
each case as constituted from time to time, from and against any and all liabilities, costs and
expenses incurred by such persons as a result of any act or omission to act in connection with the
performance of such person’s duties, responsibilities and obligations under the Plan, other than
such liabilities, costs and expenses as may result from the gross negligence, bad faith, willful
misconduct or criminal acts of such persons.

25. NO FUND CREATED. Any and all payments hereunder to any Grantee under the Plan shall
be made from the general funds of the Company (or, if applicable, a Participating Company), no
special or separate fund shall be established or other segregation of assets made to assure such
payments (unless the Committee decides to do so), and the Phantom Shares (including for purposes
of this Section 25 any accounts established to facilitate the implementation of Section
10(d)(iii)) and any other similar devices issued hereunder to account for Plan obligations do not
constitute Common Stock and shall not be treated as (or as giving rise to) property or as a trust
fund of any kind; provided, however, that the Company (or a Participating Company) may establish a
mere bookkeeping reserve to meet its obligations hereunder or a trust or other funding vehicle
that would not cause the Plan to be deemed to be funded for tax purposes or for purposes of Title
I of the Employee Retirement Income Security Act of 1974, as amended. The obligations of the
Company (or, if applicable, a Participating Company) under the Plan are unsecured and constitute a
mere promise by the Company (or, if applicable, a Participating Company) to make benefit payments
in the future and, to the extent that any person acquires a right to receive payments under the
Plan from the Company (or, if applicable, a Participating Company), such

- 22 -

 

 right shall be no greater than the right of a general unsecured creditor of the Company (or, if
applicable, a Participating Company). Without limiting the foregoing, Phantom Shares and any
other similar devices issued hereunder to account for Plan obligations are solely a device for the
measurement and determination of the amounts to be paid to a Grantee under the Plan, and each
Grantee’s right in the Phantom Shares and any such other devices is limited to the right to
receive payment, if any, as may herein be provided.

26. NO FIDUCIARY RELATIONSHIP. Nothing contained in the Plan (including without
limitation Section 10(e)(iii)), and no action taken pursuant to the provisions of the Plan, shall
create or shall be construed to create a trust of any kind, or a fiduciary relationship between
the Company, the Participating Companies, or their officers or the Committee, on the one hand, and
the Grantee, the Company, the Participating Companies or any other person or entity, on the other.

27. CAPTIONS. The use of captions in the Plan is for convenience. The captions are not
intended to provide substantive rights.

28. GOVERNING LAW. THE PLAN SHALL BE GOVERNED BY THE LAWS OF MARYLAND WITHOUT REFERENCE
TO PRINCIPLES OF CONFLICT OF LAWS.

- 23 -

 

EXHIBIT A

PERFORMANCE CRITERIA

     Performance-Based Grants intended to qualify as “performance based” compensation under Section
162(m) of the Code, may be payable upon the attainment of objective performance goals that are
established by the Committee and relate to one or more Performance Criteria, in each case on
specified date or over any period, up to 10 years, as determined by the Committee. Performance
Criteria may be based on the achievement of the specified levels of performance under one or more
of the measures set out below relative to the performance of one or more other corporations or
indices.

     “Performance Criteria” means the following business criteria (or any combination thereof) with
respect to one or more of the Company, any Participating Company or any division or operating unit
thereof:

	 	i)	 	pre-tax income,
	 
	 	ii)	 	after-tax income,
	 
	 	iii)	 	net income (meaning net income as reflected in the Company’s financial reports
for the applicable period, on an aggregate, diluted and/or per share basis),
	 
	 	iv)	 	operating income,
	 
	 	v)	 	cash flow,
	 
	 	vi)	 	earnings per share,
	 
	 	vii)	 	return on equity,
	 
	 	viii)	 	return on invested capital or assets,
	 
	 	ix)	 	cash and/or funds available for distribution,
	 
	 	x)	 	appreciation in the fair market value of the Common Stock,
	 
	 	xi)	 	return on investment,
	 
	 	xii)	 	total return to stockholders (meaning the aggregate Common Stock price
appreciation and dividends paid (assuming full reinvestment of dividends) during the
applicable period),
	 
	 	xiii)	 	net earnings growth,
	 
	 	xiv)	 	stock appreciation (meaning an increase in the price or value of the Common
Stock after the date of grant of an award and during the applicable period),
	 
	 	xv)	 	related return ratios,
	 
	 	xvi)	 	increase in revenues,

 

 

	 	xvii)	 	the Company’s published ranking against its peer group of real estate
investment trusts based on total stockholder return,
	 
	 	xviii)	 	net earnings,
	 
	 	xix)	 	changes (or the absence of changes) in the per share or aggregate market price
of the Company’s Common Stock,
	 
	 	xx)	 	number of securities sold,
	 
	 	xxi)	 	earnings before any one or more of the following items: interest, taxes,
depreciation or amortization, as reflected in the Company’s financial reports for the
applicable period, and
	 
	 	xxii)	 	total revenue growth (meaning the increase in total revenues after the date of
grant of an award and during the applicable period, as reflected in the Company’s
financial reports for the applicable period).

     Except as otherwise expressly provided, all financial terms are used as defined under
Generally Accepted Accounting Principles (“GAAP”) and all determinations shall be made in
accordance with GAAP, as applied by the Company in the preparation of its periodic reports to
stockholders.

     To the extent permitted by Section 162(m) of the Code, unless the Committee provides otherwise
at the time of establishing the performance goals, for each fiscal year of the Company, the
Committee may provide for objectively determinable adjustments, as determined in accordance with
GAAP, to any of the Performance Criteria described above for one or more of the items of gain,
loss, profit or expense: (A) determined to be extraordinary or unusual in nature or infrequent in
occurrence, (B) related to the disposal of a segment of a business, (C) related to a change in
accounting principle under GAAP, (D) related to discontinued operations that do not qualify as a
segment of a business under GAAP, and (E) attributable to the business operations of any entity
acquired by the Company during the fiscal year.exv10w4

EXHIBIT 10.4

PROVIDENT MORTGAGE CAPITAL ASSOCIATES, INC.

FORM OF 2011 EQUITY INCENTIVE PLAN

FORM OF RESTRICTED STOCK AWARD AGREEMENT

     THIS AGREEMENT is made by and between Provident Mortgage Capital Associates, Inc., a Maryland
corporation (the “Company”) and ________________ (the “Grantee”), dated as of the ___ day of _____,
20_.

     WHEREAS, the Company maintains the Provident Mortgage Capital Associates, Inc. 2011 Equity
Incentive Plan (the “Plan”) (capitalized terms used but not defined herein shall have the
respective meanings ascribed thereto by the Plan);

     WHEREAS, the Grantee is ___________ 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 Restricted Stock to the Grantee subject to
the terms and conditions set forth below.

     NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

     1. Grant of Restricted Stock.

     The Company hereby grants the Grantee _________ Shares of Restricted Stock of the Company, subject
to the following terms and conditions and subject to the provisions of the Plan. The Plan is
hereby incorporated herein by reference as though set forth herein in its entirety. To the extent
the terms or conditions in this Agreement conflict with any provision of the Plan, the terms and
conditions set forth herein shall govern.

     2. Restrictions and Conditions.

     The Restricted Stock awarded pursuant to this Agreement and the Plan shall be subject to the
following restrictions and conditions:

(i) Subject to clauses (iii), (iv), (v) and (vi) below, the period of restriction
with respect to Shares granted hereunder (the “Restriction Period”) shall begin on
the date hereof and lapse, solely to the extent the Grantee has not had a
Termination of Service, on the following schedule:

	 	 	 
	Date Restriction Lapses	 	Number of Shares
	_________ , 20__
	 	____
	_________ , 20__
	 	____
	_________ , 20__
	 	____

	 	 	For purposes of the Plan and this Agreement, Shares with respect to which the
Restriction Period has lapsed shall be vested. Notwithstanding the foregoing, the
Restriction Period with respect to such Shares shall only lapse as to whole Shares.
Subject to the provisions

 

 

	 		 	of the Plan and this Agreement, during the Restriction Period, the Grantee shall not
be permitted voluntarily or involuntarily to sell, transfer, pledge, hypothecate,
alienate, encumber or assign the Shares of Restricted Stock awarded under the Plan
(or have such Shares attached or garnished).
	 
	 	 	 	(ii) Except as provided in the foregoing clause (i), below in this clause (ii) or in
the Plan, the Grantee shall have, in respect of the Shares of Restricted Stock
(whether or not vested), all of the rights of a stockholder of the Company,
including the right to vote the Shares and the right to receive any cash dividends.
Notwithstanding the foregoing, the Grantee shall only receive the cash dividends
paid on a Share during the Restriction Period with respect to such Share at the time
the applicable Restriction Period lapses (if any) on a cumulative basis. Shares
(not subject to restrictions) shall be delivered to the Grantee or his or her
designee promptly after, and only after, the Restriction Period shall lapse without
forfeiture in respect of such Shares of Restricted Stock.
	 
	 	 	 	(iii) Subject to clauses (iv), (v) and (vi) below, upon the Grantee’s Termination of
Service by the Company or its Subsidiaries for Cause or by the Grantee for any
reason other than his or her death or Disability during the Restriction Period, then
all Shares still subject to restriction shall thereupon, and with no further action,
be forfeited by the Grantee.
	 
	 	 	 	(iv) In the event the Grantee has a Termination of Service (other than a Termination
of Service by the Company for Cause) within 12 months following a Change of Control
during the Restriction Period, the Restriction Period will immediately lapse on all
Restricted Stock granted to the Grantee.
	 
	 	 	 	(v) In the event the Grantee has a Termination of Service on account of death or
Disability or on account of Termination of Service by the Company for any reason
other than for Cause during the Restriction Period, the Restriction Period will
immediately lapse on all Restricted Stock granted to the Grantee.
	 
	 	 	 	(vi) Termination of Service as an employee shall not be treated as a termination of
employment for purposes of this paragraph 2 if the Grantee continues without
interruption to serve thereafter as an officer or director of the Company or in such
other capacity as determined by the Committee (or if no Committee is appointed, the
Board), and the termination of such successor service shall be treated as the
applicable termination.

     3. Miscellaneous.

	 	(a)	 	THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF MARYLAND, WITHOUT REGARD TO ANY PRINCIPLES OF CONFLICTS OF LAW WHICH
COULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF
MARYLAND. 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.

 

 

	 	(b)	 	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 (either by
first class mail or via electronic mail), addressed to the attention of the Board; and
if to the Grantee, shall be delivered personally or mailed to the Grantee (either by
first class mail or via electronic mail) 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 3(b).
	 
	 	(c)	 	The grant made hereby is made to the Manager in consideration of services
rendered thereby, and is in turn made by the Manager in consideration of the services
rendered by the Grantee. The terms of any such award by the Company to the Manager
shall include the forfeiture of such shares of Restricted Stock by the Manager in the
event the Grantee does not satisfy all vesting conditions set forth in this Agreement.
For purposes of (i) the provisions in paragraphs 2(i) through 2(vi) above relating to
employment with the Company (and the termination thereof), (ii) the withholding
provisions set forth in paragraph 3(f), and (iii) any references in the Plan to an
employment agreement, “Company,” as the context so requires, shall include Manager and
its affiliates to the extent that the Grantee is a provider of services to such
entities.
	 
	 	(d)	 	Without limiting the Grantee’s rights as may otherwise be applicable in the
event of a Change of Control, if the Company shall be consolidated or merged with
another corporation or other entity, the Grantee may be required to deposit with the
successor corporation the certificates for the stock or securities or the other
property that the Grantee is entitled to receive by reason of ownership of Restricted
Stock in a manner consistent with the Plan, and such stock, securities or other
property shall become subject to the restrictions and requirements imposed under the
Plan and this Agreement, and the certificates therefor or other evidence shall bear a
legend similar in form and substance to the legend set forth in the Plan.
	 
	 	 	 	Any shares or other securities distributed to the grantee with respect to Restricted
Stock or otherwise issued in substitution of Restricted Stock shall be subject to
the restrictions and requirements imposed by the Plan and this Agreement, including
depositing the certificates therefor with the Company together with a stock power
and bearing a legend as provided in the Plan.
	 
	 	(e)	 	The failure of the Grantee or the Company to insist upon strict compliance with
any provision of this Agreement, or to assert any right the Grantee or the Company,
respectively, may have under this Agreement, shall not be deemed to be a waiver of such
provision or right or any other provision or right of this Agreement.
	 
	 	(f)	 	The Company shall be entitled to withhold from any payments or deemed payments
any amount of tax withholding it determines to be required by law.
	 
	 	(g)	 	Nothing in this Agreement shall confer on the Grantee any right to continue in
the employ or other service of the Company or its Subsidiaries or interfere in any way
with the right of the Company or its Subsidiaries and its stockholders to terminate the
Grantee’s employment or other service at any time.
	 
	 	(h)	 	This Agreement 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 Grantee have executed this Agreement as of the day and
year first above written.

	 	 	 	 	 	 	 

	 	 	PROVIDENT MORTGAGE CAPITAL ASSOCIATES, INC.

	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 
	 	 	GRANTEE

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