EXHIBIT 10.2
COUNTRYWIDE FINANCIAL CORPORATION
PERFORMANCE VESTED
STOCK APPRECIATION RIGHT AGREEMENT
This "Agreement" is made as of [INSERT DATE] (the "Grant Date") between
Countrywide Financial Corporation (the "Company") and you (the "Participant").
In accordance with the 2000 Equity Incentive Plan of Countrywide
Financial Corporation (Amended and Restated Effective June 16, 2004) (the
"Plan"), the Company has granted to the Participant this Stock Appreciation
Right ("SAR") which represents the right to receive the aggregate dollar value
of appreciation ("Appreciation") in the Fair Market Value of the Company's
Common Stock, par value $0.05 per share, on the number of shares (the "Granted
Shares") set forth on the SAR Statement (the "Statement") linked electronically
hereto. The Appreciation shall be computed by multiplying (A) the excess, if
any, of (i) the Fair Market Value of a share of Stock on the Exercise Date (as
defined below), over (ii) the Fair Market Value of a share of Stock on the Grant
Date (the "Xxxxx Xxxxx"), times (B) the number of Granted Shares exercised. The
Appreciation shall be payable by the Company only in shares of Stock. This SAR
is in all respects limited and conditioned as hereinafter provided, and is
subject to the terms and conditions of the Plan. Capitalized terms not defined
herein shall have the meaning ascribed to them in the Plan.
1. GRANT AND VESTING OF SAR. This Agreement along with the Statement
evidences the Company's grant to the Participant as of the Grant Date, the right
to exercise, on the terms and conditions described in this Agreement and in the
Plan, all or a portion of the SAR, and become entitled to payment of the
Appreciation with respect to the exercised portion of the SAR. The SAR shall
become exercisable if, and only if, both (i) the employee is employed by the
Company at all times from the Grant Date through the vesting date and (ii) the
Earnings Per Share ("EPS") goals of the Company have been attained pursuant to
the following schedule:
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Cumulative Percentage of
Shares Exercisable Vesting Date* Cumulative EPS Goals
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33% [insert date] $X.XX (EPS for [insert year] only)
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66% [insert date] $XX.XX (EPS for [insert year] plus
[insert year])
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100% [insert date] $XX.XX (EPS for [insert three years])
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Remaining unvested shares [insert date] $XX.XX (EPS for [insert four years])
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* provided Cumulative EPS Goals are achieved
The SAR shall become fully exercisable upon termination of employment as a
result of death, Disability, Normal Retirement, or on [INSERT DATE] [THIS LAST
PROVISION WILL NOT BE NEEDED WHEN COMPANY ADOPTS FAS 123.] whether or not the
Cumulative EPS Goals have been achieved. This SAR shall expire at 5:00 p.m.,
central time, on the fifth anniversary of the Grant Date (the "Expiration
Date").
2. EXERCISE AND PAYMENT OF APPRECIATION. Upon exercise of all or a
portion of this SAR, the Participant shall be paid that number of shares of
Stock equal to the quotient of (i) the Appreciation applicable to the number of
Granted Shares to which this SAR is exercised divided by (ii) the Fair Market
Value of a share of Stock on the date such notice was received by the Company
(the "Exercise Date"), less any shares of Stock withheld to satisfy obligations
for the payment of withholding taxes and other tax obligations relating to this
SAR, as specified in paragraph 7. The certificate or certificates for the number
of shares of Stock so determined shall be registered in the name of the person
or persons so exercising this SAR (or, if this SAR shall be exercised by the
Participant and if the Participant shall so request in the notice exercising
this SAR, shall be registered in the name of the Participant and the
Participant's spouse, jointly, with right of survivorship or a trust established
by the Participant for estate planning purposes) and shall be delivered as
provided above to or upon the written order of the person or persons exercising
this SAR. In the event this SAR is exercised by any person or persons after the
legal disability or death of the Participant, such notice shall be accompanied
by appropriate proof of the right of such person or persons to exercise this
SAR. All shares of Stock that shall be delivered upon the exercise of this SAR
as provided herein shall be fully paid and non-assessable by the Company.
3. TERMINATION OF SAR AND ACCELERATION OF VESTING.
(a) EFFECT OF TERMINATION OF EMPLOYMENT OR SERVICE. This SAR
shall terminate upon or following the Participant's termination of employment
with the Company and its Subsidiaries as follows:
(i) In the event the Participant's employment terminates
for any reason other than death, Disability, Cause or Retirement, then the
Participant may at any time within three (3) months after his or her termination
of employment and service as Nonemployee Director, exercise this SAR to the
extent, and only to the extent, the SAR or portion thereof was exercisable at
the date of such termination.
(ii) In the event the Participant's employment terminates,
other than as a result of death, Disability, Normal Retirement or Cause, and the
Participant returns to employment with the Company within three (3) months after
the termination, the termination will have no effect on the SAR and the
Participant shall have the same number of shares and the same vesting schedule
set forth in this Agreement.
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(iii) In the event the Participant's employment terminates
as a result of Disability, then such SAR shall become immediately and fully
exercisable and the Participant may at any time within one (1) year after such
termination exercise such SAR to the extent, and only to the extent, the SAR or
portion thereof was exercisable on the date of termination.
(iv) In the event the Participant's employment terminates
for Cause, the SAR shall terminate immediately and no rights thereunder may be
exercised.
(v) In the event the Participant dies while an employee of
the Company or any Subsidiary or within three (3) months after termination as
described in clause (i) above or within one (1) year after termination as a
result of Disability as described in clause (iii) above or Retirement under
clause (vi) below, then, to the extent it is not exercisable, the SAR shall
become immediately and fully exercisable and the SAR may be exercised at any
time within one (1) year after the Participant's death by the person or persons
to whom the Participant's rights pass by transfer or Beneficiary Designation, as
the case may be, or, absent such a transfer or Beneficiary Designation, as the
case may be, by the person or persons to whom such rights under the SAR shall
pass by will or the laws of descent and distribution; provided however, that an
SAR may be exercised to the extent, and only to the extent, that the SAR or
portion thereof was exercisable on the date of death or earlier termination.
(vi) In the event the Participant terminates employment as
a result of Normal Retirement, then the SAR shall become immediately and fully
exercisable. In the event the Participant's employment terminates as a result of
Normal Retirement, the Participant may at any time within one (1) year after
termination of service by reason of Retirement, exercise such SARs to the
extent, and only to the extent, the SARs or portion thereof was exercisable at
the date of such termination.
(b) EFFECT OF A CORPORATE CHANGE. In the event of a Corporate
Change, (1) all SARs outstanding on the date of such Corporate Change shall
become immediately and fully exercisable and (2) an Participant shall be
permitted to surrender for cancellation within sixty (60) days after such
Corporate Change, any SAR or portion of an SAR to the extent not yet exercised
and the Participant will be entitled to receive a payment in shares of Stock
equal in value to the excess, if any of (x) the greater of (i) the Fair Market
Value, on the date preceding the date of surrender of the Granted Shares subject
to the SAR or portion thereof surrendered, or (ii) the Adjusted Fair Market
Value of the Granted Shares subject to the SAR or portion thereof surrendered
over (y) the aggregate Exercise Price for such Granted Shares under the SAR or
portion thereof surrendered; provided however, that in the case of an SAR
granted within six (6) months prior to the Corporate Change to any Participant
who may be subject to liability under Section 16(b) of the Exchange Act, such
Participant shall be entitled to surrender for cancellation his or her SAR
during the sixty (60) day period commencing upon the expiration of six (6)
months from the date of grant of any such Option.
4. NON-TRANSFERABILITY OF SAR. This SAR or portion hereof may be
transferable or assignable to a member or members of the Participant's
"immediate family," as such term is defined in Rule 16a-1(e) under the Exchange
Act, or to a trust for the benefit solely of a
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member or members of the Participant's immediate family, or to a partnership or
other entity whose only owners are members of the Participant's immediate family
(such transferee being a "Participant"), subject to the terms and conditions of
the Plan. No SAR granted under the Plan, nor any interest in such SAR, may be
sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred
in any manner, other than pursuant to the Beneficiary Designation, by will or
the laws of descent and distribution or pursuant to a qualified domestic
relations order.
5. RIGHTS OF THE PARTICIPANT. No Participant shall be deemed for any
purpose to be the owner of any Granted Shares subject to any SAR unless and
until (a) the SAR shall have been exercised pursuant to the terms thereof, (b)
the Company shall have issued and delivered the shares of Stock to the
Participant and (c) the Participant's name shall have been entered as a
stockholder of record on the books of the Company. Thereupon, the Participant
shall have full voting, dividend and other ownership rights with respect to such
Granted Shares
6. ADJUSTMENT. If the outstanding shares of Stock or other securities
of the Company, or both, for which a SAR is then exercisable or as to which a
SAR is to be settled shall at any time be changed or exchanged by declaration of
a stock dividend, stock split or reverse stock split, combination of shares,
recapitalization, or reorganization, the Committee or the Board shall
appropriately and equitably adjust the number and kind of shares of common stock
or other securities which are subject to the Plan or subject to any SARs
theretofore granted, and the exercise or settlement prices of such SARs, so as
to maintain the proportionate number of shares or other securities without
changing the aggregate exercise or settlement price; provided, however, that
such adjustment shall be made only to the extent that such adjustment will not
affect the status of an SAR which was intended to qualify as "performance based
compensation" under Code section 162(m) at the time of grant. If the Company
recapitalizes or otherwise changes its capital structure, or merges,
consolidates, sells all of its assets or dissolves (each of the foregoing a
"Fundamental Change"), then thereafter upon any exercise of SAR theretofore
granted, the Participant shall be entitled to purchase under such SAR, in lieu
of the number of shares of Stock as to which such SAR shall then be exercisable,
the number and class of shares of stock, securities, cash, property or other
consideration to which the Participant would have been entitled pursuant to the
terms of the Fundamental Change if, immediately prior to such Fundamental
Change, the Participant had been the holder of record of the number of shares of
Stock as to which such SAR is then exercisable.
7. WITHHOLDING. Subject to limitations set forth in the Plan, the
Company shall have the right to deduct from any distribution of shares of Stock
to any Participant, an amount equal to the federal, state and local income taxes
and other amounts as my be required by law to be withheld (the "Withholding for
Taxes") with respect to any SAR. If a Participant is entitled to receive shares
of Stock upon exercise of an SAR, the Participant shall pay the Withholding for
Taxes to the Company prior to the issuance of such shares of Stock.
Notwithstanding the preceding sentence, all or any portion of the taxes required
to be withheld by the Company or, if permitted by the Committee, desired to be
paid by the Participant, in connection with the exercise of an SAR, at the
election of the Participant, may be paid by the
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Company by withholding shares of Stock otherwise issuable or subject to an SAR,
or by the Participant delivering previously owned shares of Stock, in each case
having a Fair Market Value equal to the amount required or elected to be
withheld or paid. Any such election is subject to such conditions or procedures
as may be established by the Committee and may be subject to disapproval by the
Committee
8. AMENDMENTS AND TERMINATION. The Board (or a duly authorized
committee of the Board) may amend, alter or discontinue the Plan at any time
but, except as provided pursuant to the anti-dilution adjustment of the Plan, no
such amendment shall, without the approval of the stockholders of the Company:
(a) increase the maximum number of shares of common stock for which SARs may be
granted under the Plan; (b) reduce the price at which SARs may be granted below
the price provided for in Section 6.2 of the Plan; (c) reduce the exercise price
of outstanding SARs; (d) extend the term of this Plan; (e) change the class of
persons eligible to be Participants; (f) impair the rights of any Participant
without such holder's consent.
9. BENEFICIARY DESIGNATION. The Participant may file with the Company a
written designation of a beneficiary or beneficiaries under the Plan on the form
found in the Benefits Bookstore on HR Cafe and may from time to time revoke or
amend any such designation. Any designation of beneficiary shall be controlling
over any other disposition, testamentary or otherwise. Designating a beneficiary
to exercise the SAR at death may in some jurisdictions (e.g., California) enable
the Participant to avoid the inclusion of SARs in the Participant's probate
estate at death. Such SARs will, however, still be included in the Participant's
estate for estate tax purposes. If the Participant does not make any
designation, then the Participant's SARs will pass by will or by applicable laws
of descent and distribution.
10. PARTICIPANT STATEMENT AND MODIFICATIONS. The SAR granted to the
Participant under this Agreement, the Grant Date, and its Exercise Price and
vesting schedule with respect thereto, shall be set forth on the Statement. The
Participant hereby acknowledges and agrees that the Statement may be revised
from time to time by the Company to reflect additional grants of SARs, exercises
of SARs and any permitted modifications to the Plan and SARs granted thereunder.
Unless the Participant provides written notice to the Company's Manager, Equity
Benefits within thirty (30) days of receipt of the Statement at the principal
office of the Company in Calabasas, California, or such other addresses as may
be communicated to the Participant, the Statement (including any revisions
incorporated therein) shall be binding on the Participant, without further
notice to or acknowledgment by the Participant. If no notice is received from
the Participant within the thirty (30) day period, then the Participant shall be
deemed to have acknowledged that the Statement is binding with respect to the
information contained therein.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed on its behalf by a duly authorized officer and Participant has executed
this Agreement.
PARTICIPANT: COUNTRYWIDE FINANCIAL CORPORATION
By:
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Signature
Its:
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Print Name
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