Document:

Exhibit
10.6

 

FORM OF EQUITY ACQUISITION AGREEMENT

 

 

BY AND AMONG

 

 

LNR PROPERTY CORPORATION

 

AND

 

LNR CAPITAL CORPORATION

 

 

 

DATED AS OF [                    ],
200[  ]

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I
  DEFINITIONS

  	
  1

  
	
       Section 1.1

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE II
  PURCHASE AND SALE

  	
  3

  
	
       Section 2.1

  	
  Purchase and Sale of
  the OP Units

  	
  3

  
	
       Section 2.2

  	
  Purchase Price

  	
  3

  
	
       Section 2.3

  	
  The Closing

  	
  3

  
	
       Section 2.4

  	
  Closing Deliveries

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE III
  REPRESENTATIONS AND WARRANTIES OF SELLER

  	
  3

  
	
       Section 3.1

  	
  Organization and
  Authority

  	
  4

  
	
       Section 3.2

  	
  Execution and Delivery;
  Valid and Binding Agreement

  	
  4

  
	
       Section 3.3

  	
  Noncontravention

  	
  4

  
	
       Section 3.4

  	
  Title to OP Units

  	
  4

  
	
       Section 3.5

  	
  Litigation

  	
  4

  
	
       Section 3.6

  	
  Compliance with Laws

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV
  REPRESENTATIONS AND WARRANTIES OF BUYER

  	
  5

  
	
       Section 4.1

  	
  Organization of Buyer

  	
  5

  
	
       Section 4.2

  	
  Execution and Delivery;
  Valid and Binding Agreement

  	
  5

  
	
       Section 4.3

  	
  Noncontravention

  	
  5

  
	
       Section 4.4

  	
  Certain Securities Law
  Matters

  	
  5

  
	
   

  	
   

  	
   

  
	
  ARTICLE V
  COVENANTS OF THE PARTIES

  	
  6

  
	
       Section 5.1

  	
  Consents and Approvals

  	
  6

  
	
       Section 5.2

  	
  Further Assurances

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI
  SURVIVAL AND INDEMNITY

  	
  7

  
	
       Section 6.1

  	
  Survival

  	
  7

  
	
       Section 6.2

  	
  Indemnification by
  Seller

  	
  7

  
	
       Section 6.3

  	
  Indemnification by the
  Buyer

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII
  EXERCISE OF OVER-ALLOTMENT

  	
  7

  
	
       Section 7.1

  	
  Form of Amendment

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII
  MISCELLANEOUS

  	
  7

  
	
       Section 8.1

  	
  Press Releases and
  Public Announcements

  	
  7

  
	
       Section 8.2

  	
  No Third-Party Beneficiaries

  	
  8

  
	
       Section 8.3

  	
  Entire Agreement

  	
  8

  
	
       Section 8.4

  	
  Succession
  and Assignment

  	
  8

  
	
       Section 8.5

  	
  Counterparts

  	
  8

  
	
       Section 8.6

  	
  Headings

  	
  8

  
	
       Section 8.7

  	
  Notices

  	
  8

  
	
       Section 8.8

  	
  Waiver of Jury Trial

  	
  9

  
	
       Section 8.9

  	
  Amendments and Waivers

  	
  10

  
	
       Section 8.10

  	
  Severability

  	
  10

  
	
       Section 8.11

  	
  Construction

  	
  10

  
	
   

  	
   

  	
   

  

 

	
  Exhibits

  	
   

  	
  Exhibit Name

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Amended
  Equity Acquisition Agreement

  	
   

  

 

i

 

FORM OF EQUITY ACQUISITION
AGREEMENT

 

EQUITY ACQUISITION AGREEMENT dated as of [                   ], 200[  ] (this “Agreement”), by and between
LNR Capital Corporation, a Maryland corporation (“Buyer”), and LNR
Property Corporation, a Delaware corporation (“Seller”).  Buyer and Seller are referred to collectively
herein as the “Parties.”

 

WHEREAS, LNR Capital Limited Partnership is a Delaware limited
partnership formed on August 17, 2005 (“LNR OP”);

 

WHEREAS, Seller owns Common Units (as such term is defined in the Agreement
of Limited Partnership of LNR OP dated [                ], 200[  ] (the “Partnership Agreement”) of LNR
OP;

 

WHEREAS, Seller desires to sell, and Buyer desires to purchase, in
accordance with the terms and conditions of this Agreement, all of the Seller’s
right, title, and interest in [       ]
Common Units (the “OP Units”);

 

NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties and agreements set forth in this Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Parties agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

Section
1.1             Definitions.  The following terms have the respective
meanings ascribed thereto below:

 

“Affiliate” has the meaning set forth in Rule 12b-2 of the
regulations promulgated under the Securities Exchange Act of 1934, as amended.

 

“Agreement” has the meaning set forth in the Preamble to this
Agreement.

 

“Business Day” shall mean any day other than Saturday, Sunday or
any other day on which banks in New York, New York are permitted or required to
be closed.

 

“Buyer” has the meaning set forth in the Preamble to this
Agreement.

 

“Buyer Indemnified Parties” has the meaning set forth in Section
6.2.

 

“Closing” has the meaning set forth in Section 2.3.

 

“Closing Date” has the meaning set forth in Section 2.3.

 

“Contemplated Transactions” means the sale by the Seller, and
the acquisition by the Buyer of the OP Units.

 

 

 

“Governmental Authority” means any: (i) nation, state, county,
city, town, village, district, or other jurisdiction of any nature; (ii)
federal, state, local, municipal, foreign, or other government; (iii)
governmental or quasi-governmental authority of any nature (including any
governmental agency, branch, department, official, or entity and any court or
other tribunal); or (iv) body exercising, or entitled to exercise, any
administrative, executive, judicial, legislative, police, regulatory, or taxing
authority or power of any nature.

 

“Law” has the meaning set forth in Section 3.3.

 

“Lien” means any lien, charge, option, pledge, assignment,
mortgage, security interest, preemptive right, right of first refusal or
encumbrance of any kind.

 

“LNR OP” has the meaning set forth in the Recitals to this
Agreement.

 

“Loss” means any actual loss, liability, obligation, payment,
assessment, costs or expenses, including without limitation interest,
penalties, fines, and reasonable attorneys’ fees and expenses (including those
incurred in connection with the enforcement of a Party’s right to
indemnification hereunder); provided, however, that in no event shall the term
“Loss” include punitive, special, indirect, consequential or other damages
other than direct damages.

 

“OP Units” has the meaning set forth in the Recitals to this Agreement.

 

“Organizational Documents” means (a) the articles or certificate
of incorporation and the bylaws of a corporation; (b) the partnership agreement
and any statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) the certificate of formation and operating agreement of a
limited liability company; (e) any charter, bylaw, operating agreement or
similar document not described in (a) through (d) above adopted or filed in
connection with the creation, formation, organization or operation of a Person;
and (f) any amendment or contemplated amendment to any of the foregoing.

 

“Parties” has the meaning set forth in the Preamble to this
Agreement.

 

“Partnership Agreement” had the meaning set forth in the
Recitals to this Agreement.

 

“Person” means an individual, a partnership, a corporation, a
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization, or a Governmental Entity.

 

“Purchase Price” has the meaning set forth in Section 2.2(a).

 

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

 

“Seller” has the meaning set forth in the Preamble to this
Agreement.

 

“Seller Indemnified Parties” has the meaning set forth in
Section 6.3.

 

 

2

 

“Underwriting Agreement” has the meaning set forth in Section
2.4(a).

 

ARTICLE II

 

PURCHASE
AND SALE

 

Section 2.1             Purchase
and Sale of the OP Units.  Upon the
terms and subject to the conditions set forth in this Agreement, on the Closing
Date (as defined below) the Seller hereby agrees to sell to Buyer, and Buyer
hereby agrees to purchase from the Seller, the OP Units for the Purchase Price
(as defined below).

 

Section
2.2             Purchase
Price.  (a)  On the Closing Date, Buyer shall pay to
Seller an amount equal to $[             
], (the “Purchase Price”).

 

(b)           The Purchase Price shall be paid by
Buyer by wire transfer of immediately available funds to an account of Seller
specified by Seller to Buyer in writing.

 

Section
2.3             The
Closing.  The closing of the
transactions contemplated by this Agreement (the “Closing”) is taking
place in connection with the consummation of the Buyer’s initial public offering
of the Buyer’s common stock and with the execution of this Agreement at the
offices of Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New York
10022 or at such time and place as the Parties shall mutually agree.  For all purposes hereunder (a) the date of
this Agreement shall be referred to as the “Closing Date,” and (ii) the
Closing shall be deemed to have occurred at 11:59 p.m. on the Closing Date.

 

Section
2.4             Closing
Deliveries.  Contemporaneously
herewith, and simultaneously with the other Party’s deliveries hereunder:

 

(a)           Seller shall deliver to Buyer the
certificates representing the OP Units duly endorsed by Seller for transfer to
Buyer; and

 

(b)           Buyer shall deliver to Seller the
Purchase Price via wire transfer to the account(s) specified by Seller to Buyer
in writing.

 

ARTICLE III

 

REPRESENTATIONS
AND WARRANTIES

OF SELLER

 

The Seller hereby represents and warrants to the Buyer, as of the date
of this Agreement, as follows:

 

 

3

 

Section
3.1             Organization
and Authority.  Seller is a
corporation duly formed, validly existing, and in good standing under the laws
of the state of Delaware with all requisite power and authority to carry out
the transactions contemplated hereby.

 

Section
3.2             Execution
and Delivery; Valid and Binding Agreement.  
(a)  The execution, delivery and
performance by Seller of this Agreement, and the consummation of the
Contemplated Transactions, have been duly and validly authorized by all requisite
corporate proceedings on the part of Seller, and no other corporate proceedings
on the part of Seller are necessary to authorize the execution, delivery and
performance by Seller of this Agreement.

 

(b)           This Agreement has been duly executed
and delivered by Seller and, assuming that this Agreement is the valid and
binding agreement of the Buyer, constitutes the valid and binding obligation of
Seller, enforceable against Seller in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors’ rights or by general principles of equity.

 

Section
3.3             Noncontravention.  Neither the execution and the delivery of
this Agreement by Seller, nor the consummation by Seller of the Contemplated
Transactions, will (a) violate (i) any constitution, statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or other restriction
(each, a “Law”) of any Governmental Entity to which Seller is subject,
(ii) any provision of the Organizational Documents of Seller or (iii) any
agreement, indenture or instrument to which any of the Seller is a party, or
(b) require Seller to give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any Governmental Entity or other third party in order
for Seller to consummate the Contemplated Transactions, except, in the case of
the foregoing clauses (a)(i), (a)(iii) and (b), for any such violations,
conflicts, breaches, defaults, rights of acceleration, terminations,
cancellations, requirements or other actions or notices that are not reasonably
likely, individually or in the aggregate, to result in a material adverse
effect on the value of the OP Units, taken as a whole.

 

Section
3.4             Title
to OP Units.  As of the date of this
Agreement, all of the OP Units are owned by Seller and Seller has good title to
all of such OP Units, free and clear of Liens. 
At Closing, Seller will transfer, and Buyer will acquire, good and
marketable title to the OP Units, free and clear of any Liens.

 

Section
3.5             Litigation.    As of the date of this Agreement, there is
no action, suit, investigation or proceeding pending, or, to the knowledge of
Seller, threatened against Seller before any Governmental Entity specifically
relating to the ownership of the OP Units. 
Seller has no pending action against any third party relating
specifically to the ownership of the OP Units. 
There are no unsatisfied judgments or material outstanding orders,
writs, injunctions, decrees, settlements, stipulations or awards (whether
rendered by a court or Governmental Entity or by arbitration) against Seller
specifically relating to the ownership of the OP Units.  There is in effect no temporary restraining
order, injunction or similar equitable relief applicable to Seller prohibiting
or seeking to prohibit consummation of the Contemplated Transactions.

 

Section
3.6             Compliance
with Laws. Seller has been and is in compliance with all Laws applicable to
the OP Units, except where such noncompliance would not result in any 

 

 

4

 

change, event or circumstance that has or is reasonably likely to,
individually or in the aggregate, have a material adverse effect on the value
of the OP Units, taken as a whole.

 

ARTICLE IV

 

REPRESENTATIONS
AND WARRANTIES OF BUYER

 

The Buyer hereby represents and warrants to the Seller, as of the date
of this Agreement, as follows:

 

Section
4.1             Organization
of Buyer.  Buyer is a corporation
duly formed, validly existing, and in good standing under the laws of the State
of Maryland with all requisite power and authority to carry out the
transactions contemplated hereby.

 

Section
4.2             Execution
and Delivery; Valid and Binding Agreement. 
(a)  The execution, delivery and
performance by Buyer of this Agreement, and the consummation of the
Contemplated Transactions, have been duly and validly authorized by all requisite
corporate proceedings on the part of Buyer, and no other corporate proceedings
on its part are necessary to authorize the execution, delivery and performance
of this Agreement.

 

(b)           This Agreement has been duly executed
and delivered by Buyer and, assuming that this Agreement is the valid and
binding agreement of Seller, constitutes the valid and binding obligation of
Buyer, enforceable against Buyer in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors’ rights or by general principles of equity.

 

Section
4.3             Noncontravention.  Neither the execution and the delivery of
this Agreement nor the consummation of the Contemplated Transactions, will (a)
violate (i) any Law to which Buyer is subject (ii) any provision of Buyer’s
Organizational Documents or (iii) any agreement, indenture or instrument to
which any of the Buyer is a party, or (b) require Buyer to give any notice to,
make any filing with, or obtain any authorization, consent, or approval of any
Governmental Entity or other third party in order for Buyer to consummate the
Contemplated Transactions, except, in the case of the foregoing clauses (a)(i),
(a)(iii) and (b), for any such violations, conflicts, breaches, defaults,
rights of acceleration, terminations, cancellations, requirements or other
actions or notices that are not reasonably likely, individually or in the
aggreagate, to result in a material adverse effect on the ability of Buyer to
consummate the Contemplated Transactions.

 

Section
4.4             Certain
Securities Law Matters. (a)  Buyer is an “accredited investor” as such
term is defined in Regulation D promulgated under the Securities Act.  Buyer is acquiring the OP Units for its own
account for investment and with no present intention of distributing or
reselling such securities or any part thereof in any transaction which would
constitute a “distribution” within the meaning of the Securities Act.  Buyer understands that the OP Units have not
been registered under the Securities Act or any state securities laws and are
being transferred to Buyer in part in reliance on the foregoing
representation.  Buyer understands 

 

 

5

 

that the OP Units may not be sold, transferred, offered for sale,
pledged, hypothecated or otherwise disposed of without registration under the
Securities Act and any applicable state securities laws, except pursuant to an
exemption from such registration under the Securities Act and such laws.  Buyer is able to bear the economic risk of
holding the OP Units for an indefinite period, and has knowledge and experience
in financial and business matters such that it is capable of evaluating the
risks of the investment in the OP Units. Buyer has had the opportunity to
perform such due diligence regarding the OP Units as deemed by it to be
reasonably necessary and appropriate in the circumstances, and except for the
specific representations and warranties set forth herein, is relying solely
upon its own due diligence and analysis of the economic, legal and tax aspects
of owning the OP Units and consummating the Contemplated Transactions.

 

ARTICLE V

 

COVENANTS
OF THE PARTIES

 

Section
5.1             Consents
and Approvals.  Subject to the terms
hereof, with respect to any consents, approvals or filings which have not been
obtained or made as of the date hereof, or which by the nature of the relevant
consent, approval or filing cannot be obtained or made prior to Closing, the
Parties shall use their respective commercially reasonable efforts to, as
promptly as practicable (i) take, or cause to be taken, all actions, and do, or
cause to be done, and to assist and cooperate with the other parties in doing,
all things necessary, proper or advisable to obtain such consents or approvals
(ii) make all necessary filings, and thereafter make any other required
submissions, with respect to this Agreement required under any applicable
federal or state securities Laws and any other applicable Law, and (iii)
execute and/or deliver any additional instruments necessary to fully carry out
the purposes of this Agreement.  The
Parties shall cooperate with each other in connection with obtaining such
consents or approvals or the making of all such filings, including providing
copies of all such documents to the non-filing party and its advisors prior to
filing.  The Parties shall use their
respective commercially reasonable efforts to furnish to each other all
information required for any application or other filing to be made pursuant to
the rules and regulations of any applicable Law in connection with any of the
transactions contemplated hereby.

 

Section
5.2             Further
Assurances.  The parties shall
cooperate reasonably with each other and with their respective representatives
in connection with any steps required to be taken as part of their respective
obligations under this Agreement, and shall (a) furnish upon request to each
other such further information; (b) execute and deliver to each other such
other documents; and (c) do such other acts and things, all as the other party
may reasonably request for the purpose of carrying out the intent of this
Agreement; provided, however, that neither Party shall be required to make any
material change to its business, expend any material funds or incur any other
material burden in order to comply with this Section 5.2.

 

6

 

ARTICLE VI

 

SURVIVAL
AND INDEMNITY

 

Section
6.1             Survival.  All of the representations and warranties of
the Seller contained in Article III above, and all of the representations and
warranties of the Buyer contained in Article IV above, shall survive the
Closing hereunder and continue in full force and effect for a period of one
year following the Closing Date.  The
Parties’ respective covenants and agreements to be performed at or after the
Closing Date contained in this Agreement shall survive indefinitely unless
otherwise set forth herein.

 

Section
6.2             Indemnification
by Seller.  Subject to the
limitations of Section 5.1 above, Seller agrees to indemnify the Buyer and its
Affiliates and their officers, directors, managers, members, employees and
stockholders (collectively, the “Buyer Indemnified Parties”) from, and
hold them harmless against any Losses, which any of the Buyer Indemnified
Parties suffer, sustain or become subject to, that are caused by, arise out of
or are a result of any of the following: (i) any material breach of any of the
representations and warranties of Seller contained in this Agreement (except
for those representations and warranties that are qualified by materiality, for
which the Seller agrees to indemnify for any breach); or (ii) any material
breach of, or failure to perform, any covenant or agreement of Seller contained
in this Agreement.

 

Section
6.3             Indemnification
by the Buyer. Subject to the limitations of Section 5.1 above, the Buyer
agrees to indemnify Seller, and its Affiliates, officers, directors, managers,
members, employees and stockholders (collectively, the “Seller Indemnified
Parties”) from, and hold them harmless against, any Losses, which any of
the Seller Indemnified Parties suffer, sustain or become subject to, that are
caused by or are a result of any of the following: (i) any material breach of
any of the representations and warranties of the Buyer contained in this
Agreement (except for those representations and warranties that are qualified
by materiality, for which the Buyer agrees to indemnify for any breach), or
(ii) any material breach of, or failure to perform, any covenant or agreement
of the Buyer contained in this Agreement.

 

ARTICLE VII

 

EXERCISE
OF OVER-ALLOTMENT

 

Section
7.1             Form
of Amendment. In the event that the underwriters’ over-allotment option is
exercised pursuant to Section 2(c) of the Underwriting Agreement, the Parties
shall execute an amendment to this Agreement, in the form attached hereto as
Exhibit A.

 

ARTICLE VIII

 

MISCELLANEOUS

 

Section
8.1             Press
Releases and Public Announcements. 
No Party shall issue any press release or make any public announcement relating
to the subject matter of this Agreement without the prior written approval of
the other Party; provided, however, that any Party may make any 

 

 

7

 

public disclosure required by applicable Law (in which case the
disclosing Party will use commercially reasonable efforts to advise the other
Party prior to making such disclosure).

 

Section
8.2             No Third-Party
Beneficiaries.  Except as set forth in Article V with respect
to Seller Indemnified Parties and Buyer Indemnified Parties, this Agreement
shall not confer any rights or remedies upon any Person other than the Parties
and their respective successors and permitted assigns.

 

Section
8.3             Entire
Agreement.  This Agreement
constitutes the entire agreement between the Parties and supersede any prior
understandings, agreements, or representations by or between the Parties,
written or oral, to the extent they related in any way to the subject matter
hereof and thereof.

 

Section 8.4             Succession and Assignment.  This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective
successors and permitted assigns. No Party may assign either this Agreement or
any of its rights, interests, or obligations hereunder without the prior
written approval of the other Party.

 

Section
8.5             Counterparts.  This Agreement may be executed in one or more
counterparts, and by different parties on different counterparts, each of which
shall be deemed an original but all of which together will constitute one and
the same instrument.

 

Section
8.6             Headings.  The section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.

 

Section
8.7             Notices.  All notices, requests, demands, claims, and
other communications hereunder will be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given if (and then
three Business Days after) it is sent by registered or certified mail, return
receipt requested, postage prepaid, and addressed to the intended recipient as
set forth below:

 

If to Seller:

 

LNR Property Corporation 

c/o LNR Property Holdings Ltd.

1601 Washington Avenue, Suite 800

Miami Beach, Florida 33139

Attention: General Counsel

Facsimile: (305) 695-5500

 

Copy to:

 

Schulte Roth & Zabel LLP

919 Third Avenue

 

 

8

 

New York, New York 10022

Facsimile: (212) 593-5955

Attention: André Weiss, Esq.

 

If to the Buyer:

 

LNR Capital Corporation

c/o LNR Property Holdings Ltd.

1601 Washington Avenue, Suite 800

Miami Beach, Florida 33139

Attention: General Counsel

Facsimile: (305) 695-5500

 

Copy to:

 

Schulte Roth & Zabel LLP

919 Third Avenue

New York, New York 10022

Facsimile: (212) 593-5955

Attention: André Weiss, Esq.

 

Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the address set forth
above using any other means (including personal delivery, expedited courier,
messenger service, telecopy, telex, ordinary mail, or electronic mail), but no
such notice, request, demand, claim, or other communication shall be deemed to
have been duly given unless and until it actually is received by the intended
recipient. Any Party may change the address to which notices, requests,
demands, claims, and other communications hereunder are to be delivered by
giving the other Party notice in the manner herein set forth.  This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of New York without
giving effect to any choice or conflict of law provision or rule (whether of
the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New
York.  Any proceeding seeking to enforce
any provision of, or based on any right arising out of, this Agreement may only
be brought against any of the Parties in the courts of the State of New York,
County of New York, or, if it has or can acquire jurisdiction, in the United
States District Court for the Southern District of New York, and each of the
Parties consents to the jurisdiction of such courts (and of the appropriate
appellate courts) in any such action or proceeding and waives any objection to
venue laid therein.

 

Section
8.8             Waiver
of Jury Trial.  EACH PARTY
ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE
EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH
PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT.  EACH
PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, 

 

9

 

AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER, (B) EACH SUCH PARTY UNDERSTANDS AND HAS
CONSIDERED THE IMPLICATIONS OF THIS WAIVER AND (C) EACH SUCH PARTY HAS BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS SET FORTH HEREIN.

 

Section
8.9             Amendments
and Waivers.  No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Parties.  No waiver by
any Party of any default, misrepresentation, or breach of warranty hereunder,
whether intentional or not, shall be deemed to extend to any prior or
subsequent default, misrepresentation, or breach of warranty hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.

 

Section
8.10           Severability.  Any term or provision of this Agreement that
is invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.

 

Section
8.11           Construction.
The Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties
and no presumption or burden of proof shall arise favoring or disfavoring any
Party by virtue of the authorship of any of the provisions of this Agreement.
Any reference to any federal, state, local, or foreign statute or law shall be
deemed also to refer to all rules and regulations promulgated thereunder,
unless the context requires otherwise. The word “including” means “including
without limitation.”

 

[SIGNATURES ON FOLLOWING
PAGE]

 

 

10

 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first above written.

 

	
   

  	
  LNR
  PROPERTY CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  LNR
  CAPITAL CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

 

Exhibit A

 

Amendment to Equity
Acquisition AgreementExhibit
10.7

 

 

LNR
CAPITAL CORPORATION

 

200[ ]
STOCK INCENTIVE PLAN

 

 

TABLE
OF CONTENTS

 

	
  1.

  	
  Purpose
  of the Plan

  	
  1

  
	
  2.

  	
  Definitions

  	
  1

  
	
  3.

  	
  Authority to Grant Stock
  Options

  	
  3

  
	
  4.

  	
  Authority to Grant Stock
  Appreciation Rights.

  	
  3

  
	
  5.

  	
  Authority to Grant
  Restricted Stock

  	
  3

  
	
  6.

  	
  Authority to Grant Other
  Stock-Based Awards

  	
  4

  
	
  7.

  	
  Terms and Conditions of
  Stock Options

  	
  4

  
	
  8.

  	
  Terms and Conditions of
  Stock Appreciation Rights

  	
  5

  
	
  9.

  	
  Terms and Conditions of
  Restricted Stock and Other Stock-Based Awards

  	
  6

  
	
  10.

  	
  Payment of Option Exercise
  Price

  	
  7

  
	
  11.

  	
  Written
  Agreement

  	
  8

  
	
  12.

  	
  Administration of the Plan

  	
  8

  
	
  13.

  	
  Shares Available for Options

  	
  9

  
	
  14.

  	
  Laws
  and Regulations

  	
  9

  
	
  15.

  	
  Modification of Numbers of
  Shares and Other Securities

  	
  9

  
	
  16.

  	
  Change
  in Control

  	
  10

  
	
  17.

  	
  No Rights to Continued
  Employment

  	
  10

  
	
  18.

  	
  Rights
  as a Shareholder

  	
  10

  
	
  19.

  	
  Effective
  Date

  	
  10

  
	
  20.

  	
  Amendments
  of the Plan

  	
  11

  
	
  21.

  	
  Termination
  of the Plan

  	
  11

  
	
  22.

  	
  Governing
  Law

  	
  11

  

 

 

LNR
CAPITAL CORPORATION

 

200[ ]
STOCK INCENTIVE PLAN

 

1.             Purpose of the Plan

 

The Purpose of the Plan is to encourage and
enable those Eligible Persons upon whose judgment, initiative and efforts the
Company largely depends for the successful conduct of its business to acquire a
proprietary interest in LNR, and by doing so to stimulate the efforts of those
Eligible Persons on behalf of the Company and strengthen their desire to remain
employed by, or in service to, the Company.

 

2.             Definitions

 

As used in this Plan the following
definitions apply:

 

(a)           “Award”
means a stock option, Stock Appreciation Right, an Other Stock-Based Award or
the award of Restricted Stock.

 

(b)           “Board of Directors” means the Board of Directors of LNR.

 

(c)           “Change in Control” means the occurrence
of one or more of the following events: 
(i) any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all or substantially all of the assets of
the Company to any person or group of related persons for purposes of Section
13(d) of the Securities Exchange Act of 1934, as amended (a “Group”),
together with any affiliates thereof, other than a transaction with any wholly
owned subsidiary of Company, (ii) the approval by the holders of capital stock
of the Company of any plan or proposal for the liquidation or dissolution of
the Company; (iii) any Person or Group shall become the owner, directly or
indirectly, beneficially or of record, of shares representing more than 50% of
the aggregate ordinary voting power represented by the issued and outstanding
capital stock of Company; (iv) a majority of the members of the Board of
Directors of the Company are persons who were not directors on the Effective
Date and whose election was not approved by a vote of at least a majority of
the members of the Board of Directors of the Company in office at the time of
the election who either were members of the Board of Directors on the Effective
Date or whose election as members of such Board of Directors was previously
approved by such a majority.

 

(d)           “Code” means
the Internal Revenue Code of 1986, as amended.

 

(e)           “Committee”
means the Compensation Committee of the Board of Directors, or such other
committee  of the Board of Directors as
is specified by the Board of Directors to perform the functions and duties of
the Committee under the Plan.  If there
is no Compensation Committee and the Board of Directors does not appoint
another Committee, the Board of Directors will be the Committee.

 

 

 

(f)            “Common Stock”
means common stock, par value $.[                   ]
per share, of LNR.

 

(g)           “Company” means
LNR and all its more than 50% owned subsidiaries.

 

(h)           “Discretion”
means the ability of a committee or other body to act in its sole discretion,
with no requirement that it follow past practices or treat one Eligible Person
in a manner consistent with the treatment afforded to any other Eligible
Person.

 

(i)            “Eligible Person”
means an officer, director or employee of, or any Person who performs services
for, the Company or its Affiliates (whether as a consultant, advisor or
otherwise).

 

(j)            “Fair Market Value”
means, on any day, the mean between the highest and lowest quoted selling
prices of the Common Stock on the New York Stock Exchange (or, if the Common
Stock is not traded on the New York Stock Exchange, on the principal securities
exchange or market on which the Common Stock is traded) on that date, or if
there are no sales on that date, on the next following day on which there are
sales.  In the event the Common Stock is
not publicly traded as of such date, the “fair market value” shall be
determined by the Committee or the Officers and Directors Stock Option
Committee, in its Discretion, except that for purposes of the exercise price of
an Incentive Option, fair market value shall not be less than the fair market
value of such shares as of the grant date, with such fair market value
determination to be made in ‘good faith’ as prescribed in section 14a.422A-1
Q&A 2(c)(4) of the Temporary Treasury Regulations.

 

(k)           “Grantee” means an Eligible
Person who holds an Award granted under the Plan.

 

(l)            “Incentive Option”
means an option to purchase Common Stock which meets the requirements set forth
in the Plan and is intended to be, and qualifies as, an Incentive Stock Option
as that term is used in Section 422 of the Code.

 

(m)          “LNR” means LNR
Capital Corporation, a Maryland corporation, or its successor by merger or any
similar transaction.

 

(n)           “Nonqualified Option”
means an option to purchase Common Stock which meets the requirements set forth
in the Plan but is not intended to be, or does not qualify as, an Incentive
Stock Option as that term is used in Section 422 of the Code.

 

(o)           “Officers and Directors
Stock Option Committee” means a committee designated by the Board of
Directors, consisting of two or more persons all of whom are outside directors,
as that term is used in Section 162(m) of the Code.

 

(p)           “Person” means
a “person” as such term is used for purposes of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended.

 

(q)           “Plan” means
this LNR Capital Corporation 200[ ] Stock Incentive Plan.

 

2

 

(r)            “Restricted Stock”
means Common Stock granted under the terms of the Plan, which are subject to
the restrictions hereunder.

 

(s)           “RSU” means
a restricted stock unit, granted pursuant to Section 6 of the plan which
represents the right to receive a share of Common Stock.

 

(t)            “Stock Appreciation Right”
means a right to receive the appreciation in value, or a portion of the
appreciation value, of a specified number of shares of Common Stock, as
provided in Section 8.

 

(u)           “10% Stockholder”
means a person who owns (after applying the attribution rules contained in
Section 424 of the Code) more than 10% of the total combined voting stock of
all classes of LNR or of any parent or subsidiary.

 

3.             Authority
to Grant Stock Options

 

The Committee or the Officers and Directors
Stock Option Committee may at any time authorize the grant of stock options
under the Plan to any one or more Eligible Persons.  However, the aggregate number of stock
options and Stock Appreciation Rights granted to any Grantee in any calendar
year may not exceed [           ].  Stock options granted under the Plan may be
Incentive Options or Nonqualified Options, except that (i) no Eligible Person
who is not an employee may be granted an Incentive Option, and (ii) no employee
may be granted an Incentive Option which would result in the aggregate fair
market value, determined as of the date the stock option is granted, of the
Common Stock with respect to which that Incentive Option and all other
Incentive Options held by that employee under any plan maintained by LNR (or
any parent or subsidiary of LNR) are exercisable for the first time by that
employee during any calendar year exceeds $100,000.  Each stock option will be designated at the
time of grant as a Nonqualified Option or as an Incentive Option.

 

4.             Authority to
Grant Stock Appreciation Rights.

 

The Committee or the Officers and Directors
Stock Option Committee also may grant (i) a Stock Appreciation Right
independent of a stock option or (ii) a Stock Appreciation Right in
connection with a stock option, or a portion thereof.  A Stock Appreciation Right granted pursuant
to clause (ii) of the preceding sentence (A) may be granted at the
time the related stock option is granted or at any time prior to the exercise
or cancellation of the related stock option, (B) shall cover the same
number of shares covered by a stock option (or such lesser number of shares as
the Committee may determine) and (C) shall be subject to the same terms
and conditions as such stock option except for such additional limitations as
are contemplated by this Section 4 (or such additional limitations as may be
included in a Stock Appreciation Right Award).

 

5.             Authority
to Grant Restricted Stock

 

The Committee or the Officers and Directors
Stock Option Committee may at any time authorize the grant of Restricted Stock
under the Plan to any one or more Eligible Persons.

 

3

 

6.             Authority
to Grant Other Stock-Based Awards

 

The Committee or the Officers and Directors
Stock Option Committee may at any time authorize the grant of awards of shares,
awards of RSUs and other awards that are valued in whole or in part by
reference to, or are otherwise based on the Fair Market Value, of shares of
Common Stock (“Other Stock-Based Awards”). 
Such Other Stock-Based Awards shall be in such form, and dependent on
such conditions, as the Committee or the Officers and Directors Stock Option
Committee shall determine, including, without limitation, the right to receive
one or more shares (or the equivalent cash value of such shares) upon the
completion of a specified period of service, the occurrence of an event and/or
the attainment of performance objectives. 
Other Stock-Based Awards may be granted alone or in addition to any
other awards granted under the Plan. 
Subject to the provisions of the Plan, the Committee or the Officers and
Directors Stock Option Committee shall determine: (i) to whom and when Other Stock-Based
Awards will be made; (ii) the number of shares to be awarded under (or
otherwise related to) such Other Stock-Based Awards; (iii) whether such Other
Stock-Based Awards shall be settled in cash, shares or a combination of cash
and shares; and (iv) all other terms and conditions of such Other Stock-Based
Awards (including, without limitation, the vesting provisions thereof and
provisions ensuring that all shares so awarded and issued shall be fully paid
and non-assessable).

 

7.             Terms
and Conditions of Stock Options

 

(a)           Expiration Date:  Each
stock option granted under the Plan will expire on a date determined by the
Committee or the Officers and Directors Stock Option Committee, in its
Discretion, when the stock option is granted, which will be not more than 10
years after the date of grant, except that an Incentive Option granted to an
Eligible Person who, at the time of the grant, is a 10% Stockholder will expire
not more than five years after the date of grant.

 

(b)           Exercise Date: Each stock option granted under the Plan
will be exercisable at such time or times, and in such installments, as are
determined by the Committee or the Officers and Directors Stock Option
Committee, in its Discretion, when the stock option is granted.

 

(c)           Price:  The exercise
price of each stock option granted under the Plan, will be determined by the
Committee or the Officers and Directors Stock Option Committee, in its
Discretion, at the time the stock option is granted, except that the exercise
price of a stock option may not be less than (i) if the stock option is an
Incentive Option granted to a person who is not a 10% Stockholder, 100% of the
Fair Market Value of the Common Stock on the date the stock option is granted
or (ii) if the stock option is an Incentive Option granted to a 10%
Stockholder,  110% of the Fair Market
Value of the Common Stock on the date the stock option is granted.  If the stock option is a Nonqualified Option,
the option may be granted at any price determined by the appropriate committee,
except that a stock option intended to qualify for an exemption under Section
162(m) of the Code, shall have an exercise price of not less than 100 percent
of the Fair Market Value of the Common Stock on the date the stock option is
granted.

 

4

 

(d)           Assignment:  No
stock option granted under the Plan may be assigned or transferred otherwise
than by will or by the laws of descent and distribution; provided, however,
that the Committee or the Officers and Directors Stock Option Committee, may
(but need not) permit other transfers, where the Committee or the Officers and
Directors Stock Option Committee concludes that such transferability (i) does
not result in accelerated taxation, (ii) does not cause any option intended to
be an Incentive Option to fail to meet the requirements set forth in Section 422(b)
of the Code (or any applicable successor to that Section) and (iii) is
otherwise appropriate and desirable. 
Notwithstanding the foregoing, a stock option exercisable after the
death of a Grantee may be exercised by the legatees, personal representatives
or distributees of the Grantee.

 

8.             Terms
and Conditions of Stock Appreciation Rights

 

(a)           General:  The
exercise price per share of a Stock Appreciation Right shall be an amount
determined by the Committee.  Each Stock
Appreciation Right granted independent of a stock option shall entitle a
Grantee upon exercise to a payment from the Company of an amount equal to
(i) the excess of (A) the Fair Market Value on the exercise date of
one share over (B) the exercise price per share, times (ii) the
number of shares covered by the Stock Appreciation Right.  Each Stock Appreciation Right granted in
conjunction with a stock option, or a portion thereof, shall entitle a Grantee
to surrender to the Company the unexercised stock option, or any portion
thereof, and to receive from the Company in exchange therefor an amount equal
to (I) the excess of (x) the Fair Market Value on the exercise date
of one share over (y) the exercise price of the stock option, times
(II) the number of shares covered by the stock option, or portion thereof,
which is surrendered.  The date a notice
of exercise is received by the Company shall be the exercise date.  Payment shall be made in shares of Common
Stock or in cash, or partly in shares of Common Stock and partly in cash (any
such shares valued at such Fair Market Value), all as shall be determined by
the Committee.  Stock Appreciation Rights
may be exercised from time to time upon actual receipt by the Company of
written notice of exercise stating the number of shares with respect to which
the Stock Appreciation Right is being exercised.  No fractional shares will be issued in
payment for Stock Appreciation Rights, but instead cash will be paid for a
fraction or, if the Committee should so determine, the number of shares will be
rounded downward to the next whole share.

 

(b)           Assignment:  No
Stock Appreciation Right granted under the Plan may be assigned or transferred
otherwise than by will or by the laws of descent and distribution; provided,
however, that the Committee or the Officers and Directors Stock Option
Committee, may (but need not) permit other transfers, where the Committee or
the Officers and Directors Stock Option Committee concludes that such
transferability (i) does not result in accelerated taxation and (ii) is otherwise
appropriate and desirable. 
Notwithstanding the foregoing, a Stock Appreciation Right exercisable
after the death of a Grantee may be exercised by the legatees, personal
representatives or distributees of the Grantee.

 

5

 

9.             Terms and Conditions of Restricted Stock and Other
Stock-Based Awards

 

(a)           Performance Goals: 
The Committee or the Officers and Directors Stock Option Committee, in
its Discretion, shall in the case of 
grants of Restricted Stock or Other Stock-Based Awards intended to
qualify for an exception from the limitation imposed by Section 162(m) of the
Code (the “162(m) Awards”) establish one or more performance goals (“Performance
Goals”) as a precondition to the vesting of 
Restricted Stock awards or Other Stock-Based Awards, provided, however,
that the Officers and Directors Stock Option Committee shall retain the
discretion to reduce the number of shares subject to the Restricted Stock or
Other Stock-Based Awards.  The maximum
amount of a 162(m) Award during a calendar year to any Grantee shall be: (x)
with respect to 162(m) Awards that are paid in shares, [          ] shares and (y) with respect to 162(m) Awards that are not
paid in shares, $[                ].  The Performance Goals shall be based upon the
achievement of (i) a specified level, of (x) the Company’s consolidated pre-tax
or after-tax earnings or EBITDA or (y) the pre-tax or after-tax earnings, or
the EBITDA, of any particular subsidiary, division or other business unit of
LNR or the Company, (ii) the achievement of a specified level of revenues,
earnings, costs, return on assets, return on equity, return on capital, return
on investment, total shareholder return, net sales, net income per share, cash
flows, market share, cost reduction, return on assets under management, net
operating income or net operating income as a percentage of book value with
regard to the Company, particular subsidiaries, divisions or business units of
LNR or the Company, particular assets or groups of assets or particular
employees or groups of employees, or (iii) any combination of the
foregoing.   Performance Goals may be
absolute amounts or percentages of amounts or may be relative to the
performance of other companies or of indexes. 
In addition, to the degree consistent with Section 162(m) of the
Code (or any successor section thereto), the Performance Goals may be
calculated without regard to extraordinary items.  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.  The Officers and Directors Stock
Option Committee shall have certified that any applicable Performance Goals,
and other material terms of the grant, have been satisfied.  Notwithstanding the foregoing, Performance
Goals which do not satisfy the foregoing provisions of this Section 9(a) may be
established by the Committee or the Officers and Directors Stock Option
Committee with respect to grants of Restricted Stock or Other Stock-Based
Awards not intended to qualify for an exception from the limitations imposed by
Section 162(m) of the Code.

 

(b)           Vesting Periods:  In
connection with the grant of a Restricted Stock award or Other Stock-Based
Awards, whether or not Performance Goals apply thereto, the Committee or the
Officers and Directors Stock Option Committee shall establish one or more
vesting periods (“Vesting Periods”) with respect to the shares of Restricted
Stock or Other Stock-Based Awards granted hereunder, the length of which shall
be determined in the Discretion of the Committee or the Officers and Directors
Stock Option Committee.  Subject to the
provisions of this Section 9, the award agreement and the other provisions of
the Plan, restrictions on Restricted Stock shall lapse and the vesting of Other
Stock-Based Awards shall occur, if the Grantee satisfies all applicable
employment or other service requirements through the end of the applicable
Vesting Period.

 

6

 

(c)           Assignment:  No
Restricted Stock or Other Stock-Based Awards granted under the Plan may be
assigned or transferred otherwise than by will or by the laws of descent and
distribution; provided, however, that the Committee or the Officers and
Directors Stock Option Committee may (but need not) permit other transfers,
where the Committee or the Officers and Directors Stock Option Committee
concludes that such transferability is appropriate and desirable.

 

(d)           Certificates: A stock certificate shall be issued with
respect to shares of Restricted Stock awarded under the Plan.  Such certificates shall be registered in the
name of the Grantee.  The certificates
for shares of Restricted Stock issued hereunder may include any legend which
the Committee or the Officers and Directors Stock Option Committee deems
appropriate to reflect any restrictions on transfer hereunder or under the
written agreement, or as the Committee or the Officers and Directors Stock
Option 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 award, 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 LNR Capital Corporation 200[ ] Stock Incentive Plan and a
written agreement entered into between the registered owner and LNR Capital
Corporation.  Copies of such Plan and
agreement are on file in the offices of the LNR Capital Corporation at 1601
Washington Avenue, Miami Beach, Florida, 33139; Attention General Counsel.

 

(e)           The Committee or the Officers and Directors Stock Option
Committee shall require that the stock certificates evidencing such shares be
held in custody by LNR until the restrictions thereon shall have lapsed, and
that, as a condition of any Restricted Stock award, the Grantee shall have
delivered a stock power, endorsed in blank, relating to the stock covered by
such award.  If and when such restrictions
so lapse, the stock certificates shall be delivered by LNR to the recipient or
his or her designee.

 

10.          Payment
of Option Exercise Price

 

The exercise price of any stock option will
be payable in cash or by check payable to the order of LNR, except that the
Committee or the Officers and Directors Stock Option Committee may determine,
in its Discretion, that the exercise price of the stock option may be paid by
(i) delivering shares of Common Stock with a Fair Market Value at the date the
stock option is exercised equal to all or any part of the exercise price, with
any remaining balance to be paid in cash or by check payable to the order of
LNR, (ii) pursuant to procedures established by the Committee, through the
delivery of irrevocable instruments to a broker to deliver promptly to the Company
an amount equal to the aggregate option price for the shares being purchased or
(iii) such other method as determined by the Committee.

 

7

 

11.          Written Agreement

 

Promptly after an Award is granted under the
Plan, LNR will provide the Grantee of that Award with a written agreement
containing the provisions of the Award. 
The terms of the agreement will be in accordance with the Plan, but may
contain additional provisions and restrictions authorized by the Committee or
the Officers and Directors Stock Option Committee, in its Discretion, which are
not inconsistent with the Plan.  Each
agreement relating to a stock option will state whether the stock option is or
is not intended to be an Incentive Option. 
Each Grantee of an Award granted under the Plan will be bound by the
terms of the Plan and of the agreement relating to such Award.

 

12.          Administration
of the Plan

 

(a)           The Plan will be administered by the Committee or the
Officers and Directors Stock Option Committee. 
The Officers and Directors Stock Option Committee shall be authorized to
take action under the Plan as it relates to and in order to comply with Section
162(m) of the Code.

 

(b)           The Committee or the Officers and Directors Stock Option
Committee is authorized to interpret the Plan, to establish, amend and rescind
any rules and regulations relating to the Plan, and to make any other
determinations that it deems necessary or desirable for the administration of
the Plan.  The Committee or the Officers
and Directors Stock Option Committee may correct any defect or supply any
omission or reconcile any inconsistency in the Plan in the manner and to the
extent the Committee or the Officers and Directors Stock Option Committee deems
necessary or desirable.

 

(c)           The Committee or the Officers and Directors Stock Option
Committee shall have the full power and authority to establish the terms and
conditions of any award consistent with the provisions of the Plan and to waive
any such terms and conditions at any time, in its sole discretion (including,
without limitation, accelerating or waiving any vesting conditions and/or
accelerating any payment).

 

(d)           In exercising its powers under the Plan, the Committee or
the Officers and Directors Stock Option Committee may act in its sole
discretion, with no requirement that it follow past practice or treat one
Eligible Person in a manner consistent with the treatment afforded to any other
Eligible Person.

 

(e)           All actions taken and decisions made by the Committee or
the Officers and Directors Stock Option Committee will be binding and
conclusive on all Grantees of an Award granted under the Plan and all other
Eligible Persons, and on their respective legal representatives and
beneficiaries.  No member of the
Committee or the Officers and Directors Stock Option Committee will be liable
for any determination made or action taken in good faith with respect to the
Plan or any Award granted under the Plan, or for any decision not to grant
Awards under the Plan to any Eligible Person.

 

(f)            The Committee shall require payment of any amount it may
determine to be necessary to withhold for federal, state, local or other taxes
as a result of the exercise of an Award. 
Unless the Committee specifies otherwise, the Grantee may elect to pay

 

8

 

statutory minimum withholding taxes by
(a) delivery in Shares or (b) having Shares withheld by the Company
from any Shares that would have otherwise been received by the Grantee.

 

13.          Shares
Available for Options

 

The aggregate number of shares of Common
Stock which may be issued as Awards granted under this Plan is [              ] shares, subject to adjustment
as provided in Section 15.  Any shares to
an Award which terminate or are surrendered (including shares subject to stock
options which are deemed surrendered because of exercise of Stock Appreciation
Rights, to the extent the shares are not issued on exercise of the Stock
Appreciation Rights) will be available to be issued as Awards.  Any shares as to which stock options or Stock
Appreciation Rights are exercised but which are retained by LNR to pay the
exercise price of stock options, to reimburse the Company for paying
withholding taxes or otherwise, will be deemed to have been issued upon
exercise of stock options or Stock Appreciation Rights, and will not be
available to be issued as Awards.

 

14.          Laws and Regulations

 

The obligation of the Company to issue shares
of Common Stock in connection with an Award will be subject to (a) the
condition that counsel for the Company is satisfied that the sale and delivery
will be in compliance with the Securities Act of 1933, as amended, and all
other applicable laws, rules or regulations, and (b) the condition that the
shares of stock reserved for issuance under the Plan have been authorized for
listing on any securities exchange or exchanges on which the Common Stock is
listed.

 

15.          Modification
of Numbers of Shares and Other Securities

 

If (a) the Company at any time is 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 similar transaction, (b) there is a stock dividend, stock split, reverse
stock split, stock combination, reclassification, recapitalization or other
similar change in the capital structure of LNR, or a distribution to holders of
Common Stock other than a cash dividend or (c) any other event occurs which in
the judgment of the Committee necessitates an adjustment to the terms of the
outstanding Awards which were issued under the Plan, the Committee or the
Officers and Directors Stock Option Committee may make such modifications in
terms of outstanding Awards as in its judgment are appropriate so the Grantees’
rights will be substantially proportionate to the rights existing prior to the
event, and to maintain the continuing availability of shares under Section 13
(if shares are otherwise then available) including, without limitation,
adjustments in (i) the number and kind of shares or other securities subject to
Awards, (ii) the exercise price of outstanding stock options and Stock
Appreciation Rights and (iii) the number and kind of shares or other securities
available under Section 13.  To the
extent that such action includes an increase or decrease in the number of shares
subject to outstanding Awards, the number of shares available under Section 13
above will be increased or decreased, as the case may be, proportionately.  In addition, the limits on the

 

9

 

number of Awards that may be
granted to an individual under Sections 3 and 9 may be adjusted proportionately.  The judgment of the Committee or the Officers
and Directors Stock Option Committee with respect to any matter referred to in
this Section 15 will be conclusive and binding upon each Grantee without the need
for any amendment to the Plan or any Awards which had been granted under the
Plan.

 

16.          Change in Control

 

Notwithstanding the above, each Award granted
under the Plan shall be fully vested and any Performance Goals shall be deemed
to be met upon a Change in Control.   In
the event of a Change in Control, the Committee or the Officers and Directors
Stock Option Committee may, in its sole discretion, provide for: (i) the
termination of an Award upon the consummation of the Change in Control, and the
payment of a cash amount in exchange for the cancellation of such which may
equal in the case of stock options and/or Stock Appreciation Rights, the
excess, if any, of the Fair Market Value of the shares in the Change in Control
subject to such Options or Stock Appreciation Rights over the aggregate
exercise price of such Options or Stock Appreciation Rights; and/or (ii) the
issuance of substitute Awards that will substantially preserve the otherwise
applicable terms of any Awards previously granted hereunder.

 

17.          No
Rights to Continued Employment

 

Nothing in the Plan or in any Award granted
under the Plan will give any Grantee a right to continue any service
relationship with the Company or in any other way affect the right of the
Company to terminate the service relationship of any Grantee at any time for
any reason whatsoever, with or without cause.

 

18.          Rights as a
Shareholder

 

A Grantee shall have no rights as a
shareholder with respect to any shares covered by any Award until the issuance
of a stock certificate to the Grantee for such shares.

 

19.          Effective Date

 

The Plan will be effective on the date it is
adopted by the Board of Directors (the “Effective Date”), provided that the
stockholders of LNR approve the Plan within 12 months after it is adopted by
the Board of Directors.  Awards may be
granted prior to approval of the Plan by the stockholders of LNR, but each
Award granted prior to stockholder approval of this restatement will be subject
to approval of the Plan by the stockholders of LNR within 12 months after its
adoption.  No stock option or Stock
Appreciation Right may be exercised or Restricted Stock or Other Stock-Based
Award become vested until the Plan is approved by the stockholders of LNR, and
all Awards granted before the Plan is approved by the stockholders of LNR will
automatically terminate at the end of 12 months after the Plan is adopted by
the Board of Directors if the Plan is not approved by the stockholders of LNR
by that date.

 

10

 

20.          Amendments of the
Plan

 

The Board of Directors may amend the Plan at
any time, except that no amendment to the Plan will be effective until it is
approved by the stockholders of LNR if the amendment (a) increases the maximum
number of shares which may be issued as Restricted Stock, Other Stock-Based
Awards or upon exercise of stock options or Stock Appreciation Rights granted
under the Plan, (b) changes the categories of persons eligible to receive
Awards under the Plan or (c) materially increases the benefits officers or
employees of the Company may receive under the Plan.  No amendment to the Plan will change the
exercise price, or otherwise alter any provision, of any Award which has been
granted prior to the amendment, unless the Grantee of the Award consents to the
change.

 

21.          Termination of the
Plan

 

The Plan may be terminated at any time by the
Board of Directors.  The Plan will
terminate on the 10th anniversary of the Effective Date unless it is terminated
before that.  No Award may be granted
after the Plan is terminated.  However,
termination of the Plan will not affect any Award which is outstanding when the
Plan is terminated.

 

22.          Governing Law

 

With respect to Awards granted pursuant to
the Plan and the agreements thereunder, the Plan, such agreements and any
Awards granted pursuant thereto shall be governed by the applicable Code
provisions to the maximum extent possible. 
Otherwise, the operation of, and the rights of Grantees under, the Plan,
the agreements and any Awards granted thereunder shall be governed by
applicable federal law and, to the extent not governed by federal law, by the
laws of the State of Florida, without regard to the conflicts of law provisions
thereof.

 

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