Document:

Exhibit 4.1

 

	
NUMBER
    	
 
    	
SHARES
    
	
FOI
    	
 
    	
 
    

 

Five Oaks Investment Corp.

 

	
INCORPORATED UNDER THE LAWS
   OF THE STATE OF MARYLAND
    	
 
    	
SEE REVERSE FOR CERTAIN DEFINITIONS 
   CUSIP 33830W 10 6
    

 

This Certifies that 
  
  
  
 is the record holder of

 

FULLY PAID AND NONASSESSABLE SHARES OF COMMON STOCK, $0.01 PAR VALUE, OF

 

FIVE OAKS INVESTMENT CORP.

 

transferable on the books of the Corporation by the holder hereof in person or by duly authorized attorney upon surrender of this certificate properly endorsed. This certificate is not valid until countersigned by the Transfer Agent and registered by the Registrar.

 

WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.

 

Dated:

 

	
 
    	
 
    	
 
    
	
CHIEF FINANCIAL OFFICER, SECRETARY AND TREASURER
    	
 
    	
CHIEF EXECUTIVE OFFICER AND PRESIDENT
    

 

 

The shares represented by this certificate are subject to restrictions on Beneficial Ownership and Constructive Ownership and Transfer for the purpose, among others, of the Corporation’s maintenance of its qualification as a Real Estate Investment Trust under the U.S. Internal Revenue Code of 1986, as amended (the “Code”) and for certain other purposes under the Code and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Subject to certain further restrictions and except as expressly provided in the Corporation’s Articles of Incorporation, (i) no Person may Beneficially Own or Constructively Own shares of the Corporation’s Common Stock in excess of 9.8% (in value or number of shares) of the outstanding shares of Common Stock of the Corporation unless such Person is an Excepted Holder (in which case the Excepted Holder Limit shall be applicable); (ii) no Person may Beneficially Own or Constructively Own shares of Capital Stock of the Corporation in excess of 9.8% (in value or number of shares) of the total outstanding shares of Capital Stock of the Corporation, unless such Person is an Excepted Holder (in which case the Excepted Holder Limit shall be applicable); (iii) no Person may Beneficially Own or Constructively Own Capital Stock that would result in the Corporation being “closely held” under Section 856(h) of the Code or otherwise cause the Corporation to fail to qualify as a REIT; (iv) no Person may Transfer shares of Capital Stock if such Transfer would result in the Capital Stock of the Corporation being owned by fewer than 100 Persons; and (v) except under certain circumstances provided for in the Articles of Incorporation, no Person may Beneficially Own shares of Capital Stock that would result in 25% or more of any class of shares of Capital Stock being Beneficially Owned by one or more ERISA Investors. Any Person who Beneficially Owns or Constructively Owns or attempts to Beneficially Own or Constructively Own shares of Capital Stock which causes or will cause a Person to Beneficially Own or Constructively Own shares of Capital Stock in excess or in violation of the above limitations must immediately notify the Corporation. If the restrictions on transfer or ownership provided in (i), (ii) or (iii) above are violated, the shares of Capital Stock in excess or in violation of the above limitations will be automatically transferred to a Trustee of a Trust for the benefit of one or more Charitable Beneficiaries. In addition, the Corporation may redeem shares upon the terms and conditions specified by the Board of Directors in its sole discretion if the Board of Directors determines that ownership or a Transfer or other event may violate the restrictions described above. Furthermore, if the ownership restriction provided in (iv) above would be violated or upon the occurrence of certain events, attempted Transfers in violation of the restrictions described above may be void ab initio. All capitalized terms in this legend have the meanings defined in the Articles of Incorporation of the Corporation, as the same may be amended from time to time, a copy of which, including the restrictions on transfer and ownership, will be furnished to each holder of Capital Stock of the Corporation on request and without charge. Requests for such a copy may be directed to the Secretary of the Corporation at its principal office.

 

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations:

 

	
 
    	
 
    	
 
    	
 
    	
 
    
	
TEN   COM           -
    	
as   tenants in common
    	
 
    	
UNIF   GIFT MIN ACT   -
    	
           Custodian          
    
	
TEN   ENT            -
    	
as   tenants by the entireties
    	
(Cust)                   (Minor)
    
	
JT   TEN                -
    	
as   joint tenants with right 
   of survivorship and not as 
   tenants in common
    	
 
    	
 
    	
under   Uniform Gifts to Minors            
    
	
Act
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
(State)
    
	
 
    	
 
    	
 
    	
 
    	
 
    

 

Additional abbreviations may also be used though not in the above list.

 

FOR VALUE RECEIVED,                                                                       hereby sell, assign and transfer unto

 

	
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
    	
 
    

 

 

 

(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF ASSIGNEE)

 

 

 

 

                                                                                                 Shares of the common stock represented by the within Certificate, and do hereby irrevocably constitute and appoint                                                                                                                                                                                         Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.

 

	
Dated
    	
 
    	
 
    

 

 

	
 
    	
X
    	
 
    
	
 
    	
X
    	
 
    
	
 
    	
NOTICE: THE   SIGNATURE(S) TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS   WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT   ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
    

 

	
Signature(s) Guaranteed
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
THE   SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION   (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH   MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO   S.E.C. RULE 17Ad-15.Exhibit 10.5

 

FIVE OAKS INVESTMENT CORP.

 

MANAGER EQUITY PLAN

 

	
Section
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
1.
    	
Purpose; Types of Awards
    	
1
    
	
 
    	
 
    	
 
    
	
2.
    	
Definitions
    	
1
    
	
 
    	
 
    	
 
    
	
3.
    	
Administration
    	
3
    
	
 
    	
 
    	
 
    
	
4.
    	
Eligibility
    	
4
    
	
 
    	
 
    	
 
    
	
5.
    	
Stock Subject to the Plan
    	
4
    
	
 
    	
 
    	
 
    
	
6.
    	
Terms of Awards
    	
5
    
	
 
    	
 
    	
 
    
	
7.
    	
Termination of Services
    	
8
    
	
 
    	
 
    	
 
    
	
8.
    	
General Provisions
    	
9
    

 

 

FIVE OAKS INVESTMENT CORP.

 

MANAGER EQUITY PLAN

 

1.                                      Purpose; Types of Awards.

 

The purpose of the Five Oaks Investment Corp. Manager Equity Plan (the “Plan”) is to issue equity-based incentives to (i) Oak Circle Capital Partners LLC, a Delaware limited liability company (the “Manager”), which may in turn issue incentives to its employees, officers, members, directors or consultants; and (ii) the independent directors, consultants or officers of the Company that it may employ in the future, if any (other than any such individual who is also an individual described in subsection (i) above); in order to attract, retain and motivate them in their efforts on behalf of the Company and to promote the success of the Company’s business.  The Plan provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units and other equity-based awards.

 

2.                                      Definitions.

 

For purposes of the Plan, the following terms shall be defined as set forth below:

 

(a)                                 “Award” means any Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit or Other Stock-Based Award granted under the Plan.

 

(b)                                 “Award Agreement” means any written agreement, contract or other instrument or document evidencing an Award.

 

(c)                                  “Board” means the Board of Directors of the Company; unless the context otherwise requires, such term shall include any Committee in place from time to time, as set forth in Section 3.

 

(d)                                 “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder.

 

(e)                                  “Committee” means the committee established by the Board to administer the Plan, the composition of which shall at all times consist of “non-employee directors” within the meaning of Rule 16b-3 under the Exchange Act.

 

(f)                                   “Company” means Five Oaks Investment Corp., a Maryland corporation, or any successor corporation.

 

(g)                                  “Effective Date” means December 18, 2012, the date on which the Plan was adopted by the Board and approved by the Company’s stockholders.

 

(h)                                 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations promulgated thereunder.

 

 

(i)                                     “Fair Market Value” means, with respect to Stock or other property, the fair market value of such Stock or other property determined by such methods or procedures as shall be established from time to time by the Board.  Unless otherwise determined by the Board in good faith, the per share Fair Market Value of Stock as of a particular date shall mean (i) the closing sales price per share of Stock on the national securities exchange on which the Stock is principally traded, for the last preceding date on which there was a sale of such Stock on such exchange; (ii) if the shares of Stock are then traded in an over-the-counter market, the average of the closing bid and asked prices for the shares of Stock in such over-the-counter market for the last preceding date on which there was a sale of such Stock in such market; or (iii) if the shares of Stock are not then listed on a national securities exchange or traded in an over-the-counter market, such value as the Board, in its sole discretion, shall determine.

 

(j)                                    “Management Agreement” means the Management Agreement, dated as of May 16, 2012, by and between the Company and the Manager, as such may be amended from time to time, and any successor thereto.

 

(k)                                 “Manager” means Oak Circle Capital Partners LLC, a Delaware limited liability company.

 

(l)                                     “Option” means a right, granted to a Participant under Section 6(b)(i), to purchase shares of Stock.

 

(m)                             “Other Stock-Based Award” means a right or other interest granted to a Participant that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Stock, including but not limited to unrestricted shares of Stock or dividend equivalent rights.

 

(n)                                 “Participant” means an eligible Person who has been granted an Award under the Plan.

 

(o)                                 “Person” means any natural person, corporation, partnership, association, limited liability company, estate, trust, joint venture, any federal, state or municipal government or any bureau, department or agency thereof or any other legal entity and any fiduciary acting in such capacity on behalf of the foregoing.

 

(p)                                 “Plan” means this Five Oaks Investment Corp. Manager Equity Plan, as amended from time to time.

 

(q)                                 “Public Offering” means a public offering of the Stock pursuant to the Securities Act of 1933, as amended.

 

(r)                                    “Restricted Stock” means an Award of shares of Stock to a Participant under Section 6(b)(iii) that may be subject to certain restrictions and to a risk of forfeiture.

 

(s)                                   “Restricted Stock Unit” or “RSU” means a right granted to a Participant under Section 6(b)(iv) to receive Stock, cash or other property at the end of a

 

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specified period, which right may be conditioned on the satisfaction of specified performance or other criteria.

 

(t)                                    “Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations promulgated thereunder.

 

(u)                                 “Separation from Service” shall have the meaning attributed to such term under Section 409A of the Code.

 

(v)                                 “Stock” means shares of the common stock, par value $0.01 per share, of the Company.

 

(w)                               “Stock Appreciation Right” or “SAR” means the right granted to a Participant under Section 6(b)(ii) to be paid an amount measured by the appreciation in the Fair Market Value of Stock from the date of grant to the date of exercise of the right.

 

3.                                      Administration.

 

The Plan shall be administered by the Board.  The Board may appoint a Committee to administer all or a portion of the Plan.  To the extent that the Board so delegates its authority, references herein to the Board (other than with respect to Section 8(d) below) shall be deemed references to either the Board or the Committee.  The Board may delegate to one or more agents such administrative duties as it may deem advisable, and the Committee or any other person to whom the Board has delegated duties as aforesaid may employ one or more persons to render advice with respect to any responsibility the Board or such Committee or person may have under the Plan.  No member of the Board or Committee shall be liable for any action taken or determination made in good faith with respect to the Plan or any Award granted hereunder.

 

The Board shall have the authority in its discretion, subject to and not inconsistent with the express provisions of the Plan, to administer the Plan and to exercise all the powers and authorities either specifically granted to it under the Plan or necessary or advisable in the administration of the Plan, including, without limitation, the authority to: (i) grant Awards; (ii) determine the Persons to whom and the time or times at which Awards shall be granted; (iii) determine the type and number of Awards to be granted, the number of shares of Stock to which an Award may relate and the terms, conditions, restrictions and performance criteria relating to any Award; (iv) determine whether, to what extent, and under what circumstances an Award may be settled, cancelled, forfeited, exchanged, or surrendered; (v) make adjustments in the terms and conditions of Awards; (vi) construe and interpret the Plan and any Award; (vii) prescribe, amend and rescind rules and regulations relating to the Plan; (viii) determine the terms and provisions of the Award Agreements (which need not be identical for each grant); and (ix) make all other determinations deemed necessary or advisable for the administration of the Plan.  All decisions, determinations and interpretations of the Board shall be final and binding on all persons, including but not limited to the Company, any parent or subsidiary of the Company, all Participants (or any person claiming any rights under the Plan from or through a Participant) and any stockholder.  Notwithstanding any provision of the Plan or any Award Agreement to the contrary, except as provided in the second paragraph of Section 5, neither the Board nor the Committee may take any action which would have the effect of reducing the aggregate exercise,

 

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base or purchase price of any Award without obtaining the approval of the Company’s stockholders.

 

4.                                      Eligibility.

 

Awards under the Plan may be granted to (i) the Manager, which may in turn issue incentives to its employees, officers, members, directors or consultants; and (ii) the independent directors, consultants, or officers of the Company that it may employ in the future, if any (other than any such individual who is also an individual described in subsection (i)); in order to attract, retain and motivate them in their efforts on behalf of the Company and to promote the success of the Company’s business.  In determining the type of Award to be granted and the terms and conditions of such Award (including the number of shares to be covered by such Award), the Board, or the Committee, as applicable, shall take into account such factors as the Board, or the Committee, as applicable, shall deem relevant in connection with accomplishing the purposes of the Plan.

 

5.                                      Stock Subject to the Plan.

 

The maximum number of shares of Stock reserved for the grant of Awards under the Plan at any time shall be equal to 3.0% of the issued and outstanding shares of Stock (on a fully diluted basis) as of the date of grant of any Award (other than any shares issued or subject to awards made pursuant to this Plan), subject to the following sentence and to adjustment as provided herein.  In accordance with Section 162(m) of the Code, if applicable, the aggregate number of shares of Stock as to which Awards may be granted in any one calendar year to any covered employee under Section 162(m) of the Code shall not exceed 25% of the issued and outstanding shares of Stock as of the Effective Date (subject to adjustment for stock splits, stock dividends, and other adjustments described in the following paragraph of this Section 5).  All shares of Stock reserved for issuance under the Plan may be made subject to Options and Stock Appreciation Rights.  Stock issued under the Plan may, in whole or in part, be authorized but unissued shares or shares that shall have been or may be reacquired by the Company in the open market, in private transactions or otherwise.  If any shares subject to an Award are forfeited, cancelled, exchanged or surrendered or if an Award terminates or expires without a distribution of shares to the Participant, the shares of Stock with respect to such Award shall, to the extent of any such forfeiture, cancellation, exchange, surrender, termination or expiration, again be available for Awards under the Plan.  Upon the exercise of any Award granted in tandem with any other Award, such related Award shall be cancelled to the extent of the number of shares of Stock as to which the Award is exercised and, notwithstanding the foregoing, such number of shares shall no longer be available for Awards under the Plan.

 

In the event that the Board shall determine that any dividend or other distribution (whether in the form of cash, Stock, or other property), recapitalization, Stock split, reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, or share exchange, or other similar corporate transaction or event in which the value of an Award would be enlarged or diminished disproportionately to the Company’s stockholders affects the Stock such that an adjustment is appropriate in order to prevent dilution or enlargement of the rights of Participants under the Plan, then the Board shall make equitable changes or adjustments to any or all of: (i) the number and kind of shares of Stock or other property (including cash) that may thereafter

 

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be issued in connection with Awards; (ii) the number and kind of shares of Stock or other property (including cash) issued or issuable in respect of outstanding Awards; (iii) the exercise price, base price or purchase price relating to any Award; and (iv) the performance criteria, if any, applicable to outstanding Awards.

 

In addition, the Board may determine that any such equitable adjustment may be accomplished by making a payment to the Award holder, in the form of cash or other property (including but not limited to shares of Stock).

 

Notwithstanding anything herein to the contrary, the Board may, in its sole discretion, accelerate the timing of the exercise provisions of any Award in the event of (i) the adoption of a plan of merger or consolidation under which a majority of the Stock of the Company would be eliminated, or (ii) a sale of all or any portion of the Company’s assets or capital stock.  Alternatively, the Board may, in its sole discretion and without the consent of the Participants, provide for one or more of the following: (i) the assumption of the Plan and outstanding Awards by the surviving corporation or its parent; (ii) the substitution by the surviving corporation or its parent of Awards with substantially the same terms for such outstanding Awards; (iii) immediate exercisability of such outstanding Awards followed by cancellation of such Awards; and (iv) settlement of the intrinsic value of the outstanding vested Awards in cash or cash equivalents or equity followed by the cancellation of all Awards (whether or not then vested or exercisable).

 

6.                                      Terms of Awards.

 

(a)                                 General.  The term of each Award shall be for such period as may be determined by the Board.  Subject to the terms of the Plan and any applicable Award Agreement, payments to be made by the Company upon the grant, vesting, maturation or exercise of an Award may be made in such forms as the Board shall determine at the date of grant or thereafter, including, without limitation, cash, Stock or other property, and may be made in a single payment or transfer, in installments or on a deferred basis.  The Board may make rules relating to installment or deferred payments with respect to Awards, including the rate of interest to be credited with respect to such payments.  In addition to the foregoing, the Board may impose on any Award or the exercise thereof, at the date of grant or thereafter, such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Board shall determine.

 

(b)                                 Terms of Specified Awards.  The Board is authorized to grant the Awards described in this Section 6(b), under such terms and conditions as deemed by the Board to be consistent with the purposes of the Plan.  Such Awards may be granted with vesting, value and/or payment contingent upon attainment of one or more performance goals.  Except as otherwise set forth herein or as may be determined by the Board, each Award granted under the Plan shall be evidenced by an Award Agreement containing such terms and conditions applicable to such Award as the Board shall determine at the date of grant or thereafter.

 

(i)                                     Options.  The Board is authorized to grant Options to Participants on the following terms and conditions:

 

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(A)                               Exercise Price.  The exercise price per share of Stock purchasable under an Option shall be determined by the Board, but in no event shall the per share exercise price of any Option on the date of grant of such Option be less than 100% of the Fair Market Value of a share of Stock.  The exercise price for Stock subject to an Option may be paid in cash or by an exchange of Stock previously owned by the Participant, through a “broker cashless exercise” procedure approved by the Board (to the extent permitted by applicable law) or a combination of the above, in any case in an amount having a combined value equal to such exercise price; provided that the Board may require that any Stock exchanged by a Participant shall have been owned by the Participant for at least six months as of the date of exercise.  An Award Agreement may provide that a Participant may pay all or a portion of the aggregate exercise price by having shares of Stock with a Fair Market Value on the date of exercise equal to the aggregate exercise price withheld by the Company.

 

(B)                               Term and Exercisability of Options.  The date on which the Board adopts a resolution expressly granting an Option shall be considered the day on which such Option is granted.  Options shall be exercisable over the exercise period (which shall not exceed ten years from the date of grant), at such times and upon such conditions as the Board may determine, as reflected in the Award Agreement; provided that the Board shall have the authority to accelerate the exercisability of any outstanding Option at such time and under such circumstances as it, in its sole discretion, deems appropriate.  An Option may be exercised to the extent of any or all full shares of Stock as to which the Option has become exercisable, by giving written notice of such exercise to the Board or its designated agent.

 

(C)                               Other Provisions.  Options may be subject to such other conditions including, but not limited to, restrictions on transferability of the shares acquired upon exercise of such Options, as the Board may prescribe in its discretion or as may be required by applicable law.

 

(ii)                                  Stock Appreciation Rights.  The Board is authorized to grant SARs to Participants on the following terms and conditions:

 

(A)                               In General.  Unless the Board determines otherwise, an SAR granted in tandem with an Option may be granted at the time of grant of the related Option or at any time thereafter.  An SAR granted in tandem with an Option shall be exercisable only to the extent the underlying Option is exercisable.  Payment of an SAR may be made in cash, Stock, or property as specified in the Award or determined by the Board.

 

(B)                               Right Conferred.  An SAR shall confer on the Participant a right to receive an amount with respect to each share subject thereto, upon exercise thereof, equal to the excess of (1) the Fair Market Value of one share of Stock on the date of exercise over (2) the base price of the SAR (which in the case of an SAR granted in tandem with an Option shall be equal to the exercise price of the underlying Option, and which in the case of any other SAR shall be such price as the Board may determine; provided that it is no less than 100% of the Fair Market Value of a share of Stock on the date of grant of such SAR).

 

(C)                               Term and Exercisability of SARs.  The date on which the Board adopts a resolution expressly granting an SAR shall be considered the day on

 

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which such SAR is granted.  SARs shall be exercisable over the exercise period (which shall not exceed the lesser of ten years from the date of grant or, in the case of a tandem SAR, the expiration of its related Award), at such times and upon such conditions as the Board may determine, as reflected in the Award Agreement; provided that the Board shall have the authority to accelerate the exercisability of any outstanding SAR at such time and under such circumstances as it, in its sole discretion, deems appropriate.  An SAR may be exercised to the extent of any or all full shares of Stock as to which the SAR (or, in the case of a tandem SAR, its related Award) has become exercisable, by giving written notice of such exercise to the Board or its designated agent.

 

(D)                               Other Provisions.  SARs may be subject to such other conditions including, but not limited to, restrictions on transferability of the shares acquired upon exercise of such SARs, as the Board may prescribe in its discretion or as may be required by applicable law.

 

(iii)                               Restricted Stock.  The Board is authorized to grant Restricted Stock to Participants on the following terms and conditions:

 

(A)                               Issuance and Restrictions.  Restricted Stock shall be subject to such restrictions on transferability and other restrictions, if any, as the Board may impose at the date of grant or thereafter, which restrictions may lapse separately or in combination at such times, under such circumstances, in such installments, or otherwise, as the Board may determine.  The Board may place restrictions on Restricted Stock that shall lapse, in whole or in part, only upon the attainment of one or more performance goals.  Unless otherwise determined by the Board, following a grant of Restricted Stock, the Participant shall have all of the rights of a stockholder including, without limitation, the right to vote Restricted Stock and the right to receive dividends and distributions thereon.

 

(B)                               Certificates for Stock.  Restricted Stock granted under the Plan may be evidenced in such manner as the Board shall determine.  If certificates representing Restricted Stock are registered in the name of the Participant, such certificates shall bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Stock, and the Company shall retain physical possession of the certificate.

 

(C)                               Dividends/Distributions.  Unless otherwise determined by the Board, dividends and distributions paid on Restricted Stock shall be paid at the dividend or distribution payment date, provided that such payments may be deferred to such date as determined by the Board, and in any event shall be payable in cash or in shares of Stock having a Fair Market Value equal to the amount of such dividends or distributions.  Unless otherwise determined by the Board, Stock distributed in connection with a stock split or stock dividend, and other property (other than cash) distributed as a dividend or distribution, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such Stock or other property has been distributed.

 

(iv)                              Restricted Stock Units.  The Board is authorized to grant RSUs to Participants, subject to the following terms and conditions:

 

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(A)                               Award and Restrictions.  Delivery of Stock, cash or other property, as determined by the Board, will occur upon expiration of the period specified for RSUs by the Board during which forfeiture conditions apply, or such later date as the Board shall determine.  The Board may place restrictions on RSUs that shall lapse, in whole or in part, only upon the attainment of one or more performance goals.

 

(B)                               Dividend/Distribution Equivalents.  The Board is authorized to grant to a Participant the right to receive dividend equivalent payments and distribution equivalent payments for the period prior to settlement of the RSU.  Dividend equivalents or distribution equivalents may be paid currently or credited to an account for the Participant, may be settled in cash or Stock, as determined by the Committee.  Any such settlements, and any such crediting of dividend equivalents or distribution equivalents or reinvestment in Stock, may be subject to such conditions, restrictions and contingencies as the Committee shall establish, including the reinvestment of such credited amounts in Stock equivalents.  Unless otherwise determined by the Board, any such dividend equivalents or distribution equivalents shall be paid or credited, as applicable, on the dividend or distribution payment date to the Participant as though each RSU held by such Participant were a share of outstanding Stock.

 

(v)                                 Other Stock-Based Awards.  The Board is authorized to grant Awards to Participants in the form of Other Stock-Based Awards, as deemed by the Board to be consistent with the purposes of the Plan.  Awards granted pursuant to this paragraph may be granted with vesting, value and/or payment contingent upon the attainment of one or more performance goals.  The Board shall determine the terms and conditions of such Awards at the date of grant or thereafter.  Without limiting the generality of this clause (v), Other Stock-Based Awards may include grants of shares of Stock that are not subject to any restrictions or a substantial risk of forfeiture.

 

7.                                      Termination of Services.

 

(a)                                 The Manager.  If the Management Agreement (i) is terminated by the Company for Cause pursuant to Section 13 of the Management Agreement or (ii) expires following the Manager’s issuance of a Termination Notice for a Termination without Cause pursuant to Section 11(c) of the Management Agreement, all unvested Awards then held by the Manager and all accrued and unpaid dividends or dividend equivalents related thereto shall be, as of the date of such termination or expiration of the Management Agreement, immediately cancelled and forfeited without consideration.  If the Management Agreement expires or is terminated for any other reason, including without limitation (i) expiration following the Company’s issuance of a Termination Without Cause pursuant to Section 11(c) of the Management Agreement) or (ii) a termination by the Manager pursuant to Section 14(a) or 14(b) of the Management Agreement, any Award that was not previously vested will become fully vested and/or payable, and any performance conditions imposed with respect to the Award will be deemed to be fully achieved; provided, however, that for any Award subject to Section 409A of the Code, no payment of an Award may be made to the Manager unless the termination of the Management Agreement also constitutes a Separation from Service.

 

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(b)                                 Participants Other Than the Manager.  Unless otherwise determined by the Board, all unvested Awards then held by a Participant who is not the Manager and who ceases to provide services to the Manager or the Company shall be immediately cancelled and forfeited without consideration.  The terms of Award Agreements shall set forth the terms under which an Option or Stock Appreciation Right may remain exercisable following such a termination of service with the Manager or the Company.  No payment of any Award that is subject to Section 409A of the Code may be made to a Participant upon the cessation of services with the Manager or the Company unless such cessation of services also constitutes a Separation from Service with the Manager or the Company, as applicable.

 

8.                                      General Provisions.

 

(a)                                 Nontransferability.  Awards granted to a Participant under the Plan shall not be transferable by such Participant and shall be exercisable only by such Participant; provided that any Award granted to the Manager and in turn granted by the Manager to an eligible Participant pursuant to Section 4 may be transferred as may be agreed between the Manager and such Participant.

 

(b)                                 No Right to Continued Service.  Nothing in the Plan or in any Award, any Award Agreement or other agreement entered into pursuant hereto shall (i) confer upon the Manager the right to continue to provide services to the Company or any parent or subsidiary of the Company or (ii) confer upon any other Participant the right to continue to provide services to the Manager or the Company, or confer upon any Participant the right to any remuneration or benefits not set forth in the Plan or such Award Agreement or other agreement.  Nothing in the Plan or any Award, any Award Agreement or other agreement entered into pursuant hereto shall interfere with or limit in any way the right of the Company to terminate the Management Agreement in accordance with its terms or the right of the Manager or the Company, as applicable, to terminate the employment or service of any of its employees, consultants or directors.

 

(c)                                  Taxes.  The Company or any parent or subsidiary of the Company is authorized to withhold from any Award granted, any payment relating to an Award under the Plan, including from a distribution of Stock, or any other payment to a Participant, amounts of withholding and other taxes due in connection with any transaction involving an Award, and to take such other action as the Board may deem advisable to enable the Company and such Participant to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award.

 

(d)                                 Effective Date; Amendment and Termination.

 

(i)                                     The Plan shall take effect upon the Effective Date, subject to the approval of the Company’s stockholders.

 

(ii)                                  The Board may at any time and from time to time terminate, amend, modify or suspend the Plan in whole or in part; provided, however, that unless otherwise determined by the Board, an amendment that requires stockholder approval in order for the Plan to comply with any law, regulation or stock exchange requirement shall not be

 

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effective unless approved by the requisite vote of stockholders; provided, further, that any amendment to Section 4 hereof requires the consent of the Manager.  The Board may at any time and from time to time amend any outstanding Award in whole or in part.  Notwithstanding the foregoing sentence of this clause (ii), no amendment or modification to or suspension or termination of the Plan or amendment of any Award shall affect adversely any of the rights of a Participant, without the Participant’s consent, under any Award theretofore granted under the Plan.

 

(e)                                  Expiration of Plan.  Unless earlier terminated by the Board pursuant to the provisions of the Plan, the Plan shall expire on the tenth anniversary of the Effective Date.  No Awards shall be granted under the Plan after such expiration date.  The expiration of the Plan shall not affect adversely any of the rights of a Participant, without the Participant’s consent, under any Award theretofore granted.

 

(f)                                   No Rights to Awards; No Stockholder Rights.  No Participant shall have any claim to be granted any Award under the Plan.  Each Award may be subject to different terms and conditions, as determined by the Board.  Except as provided specifically herein, a Participant shall have no rights as a stockholder with respect to any shares covered by an Award until the date of the issuance of a stock certificate to the Participant for such shares.

 

(g)                                  Unfunded Status of Awards.  The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation.  With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award shall give such Participant any rights that are greater than those of a general creditor of the Company.

 

(h)                                 No Fractional Shares.  No fractional shares of Stock shall be issued or delivered pursuant to the Plan or any Award.  The Board shall determine whether cash, other Awards or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.

 

(i)                                     Regulations and Other Approvals.

 

(i)                                     The obligation of the Company to sell or deliver Stock with respect to any Award granted under the Plan shall be subject to all applicable laws, rules and regulations, including all applicable federal, state and non-U.S. securities laws, and the obtaining of all such approvals by governmental agencies as may be deemed necessary or appropriate by the Board.

 

(ii)                                  Each Award is subject to the requirement that, if at any time the Board determines, in its absolute discretion, that the listing, registration or qualification of Stock issuable pursuant to the Plan is required by any securities exchange or under any applicable law, or the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the grant of an Award or the issuance of Stock, no such Award shall be granted or payment made or Stock issued, in whole or in part, unless listing, registration, qualification, consent or approval has been effected or obtained free of any conditions not acceptable to the Board.

 

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(iii)                               In the event that the disposition of Stock acquired pursuant to the Plan is not covered by a then-current registration statement under the Securities Act and is not otherwise exempt from such registration, such Stock shall be restricted against transfer to the extent required by the Securities Act or regulations thereunder, and the Board may require any Participant receiving Stock pursuant to the Plan, as a condition precedent to receipt of such Stock, to represent to the Company in writing that the Stock acquired by such Participant is acquired for investment only and not with a view to distribution.

 

(iv)                              The Board may require a Participant, as a condition precedent to receipt of an Award or of shares of Stock, to enter into a stockholder agreement or “lock-up” agreement in such form as the Board shall determine is necessary or desirable to further the Company’s interests.  Notwithstanding the foregoing, the Manager shall not be required to enter into such stockholder agreements or “lock-up” agreements as a condition precedent to receipt by the Manager of an Award or of shares of Stock unless reasonably requested to enter into such agreements by an underwriter in connection with a Public Offering.

 

(j)                                    Governing Law.  This Agreement and the rights and obligations of the parties hereto under this Agreement shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

 

(k)                                 Jurisdiction.  Any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Plan or the transactions contemplated hereby shall be brought in any federal or state court located in the County and State of New York, and each Participant hereby consents to the sole and exclusive jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum.  Process in any such suit, action or proceeding may be served on any Participant anywhere in the world, whether within or without the jurisdiction of any such court.

 

(l)                                     Waiver of Jury Trial.  The Participant waives any right he or she may have to trial by jury in respect of any litigation based on, arising out of, under or in connection with this Agreement or the Plan.

 

(m)                             Section 409A.  It is intended that the payments and benefits under the Plan comply with, or as applicable, constitute a short-term deferral or otherwise be exempt from, the provisions of Section 409A of the Code.  The Plan will be administered and interpreted in a manner consistent with this intent, and any provision that would cause the Plan or any Award to fail to satisfy Section 409A of the Code will have no force and effect until amended to comply therewith (which amendment may be retroactive to the extent permitted by Section 409A of the Code).

 

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