Exhibit 4.2
CHARTERMAC
RESTRICTED SHARE PLAN
SECTION 1
DEFINITIONS
As used herein, the following terms have the meanings hereinafter set
forth unless the context clearly indicates to the contrary:
"Administrator" means the Board or the Committee; whichever shall be
administering the Plan from time to time in the discretion of the Board, as
described in Section 3 of this Plan.
"Award" means any award of Restricted Shares made pursuant to Section
6 of this Plan.
"Award Agreement" means any written document setting forth the terms
and conditions of an Award, as prescribed by the Administrator.
"Board" means the Board of Trustees of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the committee appointed by the Board in accordance
with Section 3 of this Plan.
"Company" means CharterMac, a Delaware statutory trust.
"Effective Date" means the date of the consummation of the
transactions contemplated by the Contribution Agreement, dated December 17,
2002, between CharterMac Capital Company, LLC, the Related Companies, LP and
other contributors defined therein.
"Employee" means an individual who is employed (within the meaning of
Section 3401 of the Code and the Treasury Regulations thereunder) by the Company
or any Subsidiary other than Xxxxxxx X. Xxxx, Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxx,
Xxxx X. Xxxxxxxxx and Xxxxxx X. Xxxxx.
"Entity" means a corporation, limited liability company, partnership
or trust.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value of Shares" shall mean (i) if the Shares are not
publicly traded on the day in question, the closing price of the Shares on the
prior trading day or the next trading day (whichever is closest in time to the
day in question), provided that such date is no more than five (5) days from the
date the Award is granted, (ii) if the Shares are not publicly traded on the day
in question and (i) above does not apply, the fair market value of the Shares on
the day in question as determined and set forth in writing by the Administrator
(which, in making such determination, shall make a good faith effort to
establish the true fair market value of the Shares as of such date using such
methods as it deems appropriate, including independent appraisals, and taking
into consideration any requirements set forth in the Code or the Treasury
Regulations thereunder), or (ii) if the Shares are publicly traded on the day in
question, the closing price of the Shares on the day in question. The closing
price shall be the average of the highest and lowest quoted selling prices on
the American Stock Exchange or, if the Shares are not listed or admitted to
trading on such Exchange, on the principal national securities exchange on which
the Shares are listed or admitted to trading or, if not listed or admitted to
trading on any national securities exchange, as reported by the NASDAQ Stock
Market's National Market on the day in question, or if the
Shares are not listed or admitted to trading on any national securities exchange
or reported by the NASDAQ Stock Market's National Market, the closing price of
the Shares shall be the average of the highest and lowest quoted selling prices
as reported by The Wall Street Journal for the over-the-counter market on the
day in question.
"Participant" means any holder of one or more Awards, or the Shares
issuable or issued upon the vesting of Awards, pursuant to the Plan.
"Plan" means the CharterMac Restricted Share Plan, the terms of which
are set forth herein.
"Restricted Shares" means Shares subject to restrictions imposed
pursuant to Section 6.2 of this Plan.
"Share" or "Shares" means Common Shares of beneficial interest in the
Company, or, in the event that the outstanding Shares are hereafter changed into
or exchanged for different shares or securities of the Company or some other
entity, such other shares or securities.
"Subsidiary" means a current or future Entity in an unbroken chain of
Entities ending with the Company if, at the time of granting of an award, each
of such Entities owns securities possessing fifty-percent or more of the total
combined voting power in at least one of the other Entities in such chain.
"Trustee" means a member of the Board of Trustees of the Company.
SECTION 2
THE PLAN
2.1 Name. This Plan shall be known as the "CharterMac Restricted Share
Plan."
2.2 Purpose. The purpose of this Plan is to advance the interests of the
Company and its shareholders by affording Employees an opportunity to acquire or
increase their proprietary interest in the Company by the grant to such
individuals of Awards under the terms set forth herein.
SECTION 3
ADMINISTRATION
3.1 Administration. This Plan shall be administered, in the discretion of
the Board from time to time, by the Board or by the Committee acting as the
Administrator. The Committee shall be appointed by the Board, in a manner
consistent with the Company's By-laws, and shall consist of two (2) or more
Trustees and, if required for compliance with Section 16 of the Exchange Act,
each of whom is a non-employee director within the meaning of Rule 16(b)-3 of
the Exchange Act and, if required for compliance with Section 162(m) of the
Code, each of whom is an outside director within the meaning of that section and
the Treasury Regulations thereunder. The Board may from time to time remove
members from, or add members to, the Committee. The Board shall fill vacancies
on the Committee however caused. The Board may appoint one (1) of the members of
the Committee as Chairman. The Administrator shall hold meetings at such times
and places as it may determine. Acts of a majority of the Administrator at which
a quorum is present, or acts reduced to or approved in writing by the unanimous
consent of the members of the Administrator, shall be the valid acts of the
Administrator.
3.2 Duties. The Administrator shall from time to time at its discretion
determine the Employees who are to be granted Awards, the terms of any Awards,
and the number of Shares to be
subject to Awards to be granted to each Participant. The interpretation and
construction by the Administrator of any provisions of this Plan or of any Award
granted thereunder shall be final. No member of the Administrator shall be
liable for any action or determination made in good faith with respect to this
Plan or any Award granted hereunder.
SECTION 4
PARTICIPATION
4.1 Eligibility. The Participants shall be persons (collectively,
"Participants"; individually a "Participant") as the Administrator (or the
Special Committee) may select from among the Employees.
SECTION 5
SHARES SUBJECT TO PLAN
5.1 Shares Available for Awards. Subject to adjustment pursuant to the
provisions of Section 5.2 hereof, the total number of Shares, which may be
issued pursuant to all Awards, shall not exceed 1,136,108 Shares. Shares that
may be issued pursuant to Awards may be either authorized and unissued Shares or
issued Shares that have been reacquired by the Company. If, and to the extent,
any Award shall be forfeited, expire, or terminate for any reason without having
resulted in the issuance of unrestricted Shares to a Participant or a
Participant's beneficiary, new Awards may be granted covering Shares originally
set aside for the forfeited, expired, or terminated Award.
5.2 Adjustments.
(a) Stock Splits and Dividends. Subject to any required action by the
Board, the number of Shares covered by this Plan as provided in Section 5.1
hereof, the maximum number of Shares any Participant may receive as
provided in Section 6.1, and the number of Shares covered by each
outstanding Award shall be proportionately adjusted for any increase or
decrease in the number of issued Shares resulting from a recapitalization,
reclassification, subdivision or consolidation of Shares or the payment of
a dividend (but only if paid in Shares), a share split or any other
increase or decrease in the number of issued Shares effected without
receipt of consideration by the Company.
(b) Mergers. Subject to any required action by the Board and/or
shareholders, if the Company shall merge with another entity and the
Company is the surviving entity in such merger and under the terms of such
merger the Shares outstanding immediately prior to the merger remain
outstanding and unchanged, each outstanding Award shall continue to apply
to the Shares subject thereto and shall also pertain and apply to any
additional securities and other property, if any, to which a holder of the
number of Shares subject to the Award would have been entitled as a result
of the merger.
(c) Adjustment Determination. To the extent that the foregoing
adjustments relate to securities of the Company, such adjustments shall be
made by the Company, whose determination shall be conclusive and binding on
all persons. In computing any adjustment under this Section 5.2, any
fractional Share which might otherwise become subject to an Award shall be
eliminated.
SECTION 6
AWARDS
6.1 Award Grant and Agreement.
(a) The Administrator may from time to time, subject to the terms of
this Plan, grant to any Participant one or more Awards but in no event may
any such Participant receive Awards under this Plan of more than 166,267
Shares during any one calendar year; provided, however, that the
Administrator may from time to time grant Awards to eligible persons not
described in Section 16 of the Exchange Act. Each Award grant shall be
evidenced by a written Award Agreement, dated as of the date of grant and
executed by the Company and the Participant, which Award Agreement shall
set forth the number of Awards granted, the vesting schedule, and such
other terms and conditions as may be determined appropriate by the
Administrator, provided that such terms and conditions are not inconsistent
with this Plan. The Award Agreement shall incorporate this Plan by
reference and provide that any inconsistencies or disputes shall be
resolved in favor of this Plan language.
(b) Awards shall be made by the Administrator selectively among the
Participants and the terms and provisions of such grants and the agreements
evidencing the same (including, without limitation, the form, the amount,
the timing, the terms for any purchase, and the vesting schedule of such
grants) need not be uniform, whether or not the Participants are similarly
situated. Moreover, the Administrator shall be entitled to modify the
vesting terms and provisions of any outstanding Award at any time provided
that the Participant shall so consent to any modification adverse to the
Participant's interests.
6.2 Restricted Share Awards.
(a) Awards. The Administrator may award Restricted Shares to
Participants, in such amounts, and subject to such terms and conditions as
the Administrator shall determine in its discretion, subject to the
provisions of this Plan. A Participant shall have no rights with respect to
an Award unless the Participant accepts the Award within the time period
the Administrator specifies by executing the Award Agreement prescribed by
the Administrator. On the Effective Date, the Administrator shall grant the
Employees of CharterMac Capital Company, LLC listed on Exhibit A Restricted
Shares in the amounts disclosed at Exhibit A. The Restricted Shares shall
be granted using the form of Award Agreement attached as Exhibit B.
(b) Vesting. Unless an Award Agreement provides for a different
vesting schedule, twenty-percent of the Shares subject to an Award shall
become vested and nonforfeitable upon each anniversary of the grant date of
the Award. When the Shares subject to an Award vest, the Company shall
issue in the Participant's name a certificate or certificates for the
appropriate number of Shares that vested under the Award.
(c) Restrictions on Shares. Any certificate issued evidencing Shares
subject to an Award shall either remain in the Company's possession until
those Shares vest and are free of any other restrictions or shall bear a
legend disclosing the restrictions imposed on such Shares pursuant to this
Plan and the Award.
(d) Forfeiture. Following the termination of the Participant's service
with the Company and all Subsidiaries for any reason or for reasons
designated in the Award Agreement, the Participant's Shares subject to an
Award shall be forfeited.
(e) Voting/Distributions. Participants shall be entitled to vote
Shares subject to an Award on all matters the Company's shareholders are
entitled to vote. Distributions payable on
Shares subject to an Award shall be paid by the Company to the Participant
at the same time and manner as distributions are paid to the Company's
shareholders.
6.3 Non-Transferability.
(a) General. Except as set forth in Section 6.3(c) of this Plan,
Awards may not be sold, pledged, assigned, hypothecated, transferred, or
otherwise encumbered or disposed of other than by will or by the laws of
descent or distribution, and except as specifically provided in this Plan
or the applicable Award Agreement. Furthermore, unless the applicable Award
Agreement provides otherwise, additional Shares or other property
distributed to the Participant in respect of Awards, as dividends or
otherwise, shall be subject to the same restrictions applicable to such
Award.
(b) Special Rule for Beneficiaries. The designation of a beneficiary
by a Participant will not constitute a transfer. In the absence of a
validly designated beneficiary, a Participant's beneficiary shall be his or
her estate.
(c) Limited Transferability Rights. To the extent specifically
authorized by the Administrator in an Award Agreement or amendment thereto,
any Participant may transfer Awards either by gift to immediate family, or
by instrument to an inter vivos or testamentary trust in which the Awards
are to be passed, upon the death of the grantor, to beneficiaries who are
immediate family (or otherwise approved by the Administrator).
6.4 Withholding Tax.
(a) In the event the Company determines that it is required to
withhold income tax in connection with an Award, the Participant may be
required to make arrangements satisfactory to the Company to enable it to
satisfy such withholding requirements. Payment of such withholding
requirements may be made, in the discretion of the Administrator, (i) in
cash, (ii) by delivery of Shares registered in the name of the Participant
having a Fair Market Value at the time the Participant becomes subject to
income tax equal to the minimum necessary amount of tax to be withheld,
(iii) by the Company retaining or not issuing such number of Shares subject
to the Award as have a Fair Market Value at the time the Participant
becomes subject to income tax equal to the minimum necessary amount of tax
to be withheld or (iv) any combination of (i), (ii) and (iii) above.
(b) The Administrator shall be entitled as it deems appropriate to
make available for issuance under this Plan Shares tendered by a
Participant to satisfy the Company's withholding requirements.
6.5 Rights in the Event of Sale, Merger or Other Reorganization. Except as
expressly provided in Section 5.2 and this Section, the Participant shall have
no rights by reason of any subdivision or consolidation of shares of beneficial
interests of any class, the payment of any dividend in beneficial interests or
any other increase or decrease in the number of shares of beneficial interests
of any class or by reason of any dissolution, liquidation, merger or
consolidation or spin-off of assets or shares of beneficial of another entity,
and any issue by the Company of shares of beneficial interests of any class, or
securities convertible into shares of beneficial interests of any class, shall
not affect, and no adjustment by reason thereof shall be made with respect to,
the number or price (if applicable) of Shares subject to an Award. The grant of
an Award pursuant to this Plan shall not affect in any way the right or power of
the Company to make adjustments, reclassifications, reorganizations or changes
of its capital or business structure, to merge or consolidate or to dissolve,
liquidate, sell or transfer all or any part of its business or assets. In any
such event:
(a) Unless otherwise provided in the Award Agreement for any given
Award, upon any such merger (other than a merger in which the Company is
the surviving entity as described in
Section 5.2(b) and under the terms of which the Common Shares outstanding
immediately prior to the merger remain outstanding and unchanged),
consolidation, or sale or transfer of assets, all rights of the Participant
with respect to the unvested portion of any Award shall become immediately
vested, except to the extent that any agreement or undertaking of any party
to any such merger, consolidation, or sale or transfer of assets, shall
make specific provision for the assumption of the obligations of the
Company with respect to this Plan and the rights of Participants with
respect to Awards granted hereunder.
(b) Unless otherwise provided in the Award Agreement for any given
Award, upon any such liquidation or dissolution of the Company, all rights
of the Participant with respect to the unvested portion of any Award shall
wholly and completely terminate and all Awards shall be canceled at the
time of any such liquidation or dissolution, except to the extent that any
plan pursuant to which such liquidation or dissolution is effected, shall
make specific provision with respect to this Plan and the rights of
Participants with respect to Awards granted hereunder.
SECTION 7
SHARES ISSUED PURSUANT TO AN AWARD
7.1 Issuance of Certificates. The Company shall not be required to issue or
deliver any certificate for Shares issued pursuant to any Award, or any portion
thereof, prior to fulfillment of all of the following applicable conditions:
(a) The admission of such Shares to listing on all stock exchanges or
markets on which the Shares are then listed to the extent such admission is
necessary;
(b) The completion of any registration or other qualification of such
Shares under any federal or state securities laws or under the rulings or
regulations of the Securities and Exchange Commission or any other
governmental regulatory body, which the Board shall in its sole discretion
deem necessary or advisable, or the determination by the Board in its sole
discretion that no such registration or qualification is required;
(c) The obtaining of any approval or other clearance from any federal
or state governmental agency which the Board shall, in its sole discretion,
determine to be necessary or advisable; and
(d) The lapse of such reasonable period of time which the Board or
Committee may establish for reasons of administrative convenience following
the date a Participant becomes entitled to receive unrestricted Shares
pursuant to an Award.
7.2 Compliance with Securities and Other Laws. In no event shall the
Company be required to sell, issue or deliver Shares pursuant to Awards if in
the opinion of the Company the issuance thereof would constitute a violation by
either the Participant or the Company of any provision of any law or regulation
of any governmental authority or any securities exchange. As a condition of
issuance of Shares pursuant to Awards, the Company may place legends on the
Shares, issue stop-transfer orders and require such agreements or undertakings
from the Participant as the Company may deem necessary or advisable to assure
compliance with any such law or regulation, including if the Company or its
counsel deems it appropriate, representations from the Participant that the
Participant is acquiring the Shares solely for investment and not with a view to
distribution and that no distribution of the Shares acquired by the Participant
will be made unless registered pursuant to applicable federal and state
securities laws or unless, in the opinion of counsel to the Company, such
registration is unnecessary.
SECTION 8
TERMINATION, AMENDMENT AND MODIFICATION OF PLAN
8.1 Board Termination, Amendment and Modification of Plan. The Board may at
any time amend or modify this Plan; provided, however, that no such action of
the Board shall take effect without approval of the shareholders of the Company
to the extent such approval is required by applicable law or determined by the
Board to be necessary or desirable for any reason (including but not limited to
the satisfaction of listing requirements on a stock exchange).
8.2 Plan Termination. Unless terminated earlier as provided in Section 8.1,
this Plan shall terminate ten (10) years from the date it is adopted by the
Board and no Award shall be granted under this Plan after such expiration date.
Termination of this Plan shall not alter or impair any of the rights or
obligations under any Award theretofore granted under this Plan unless the
Participant shall so consent.
8.3 Effect of Termination, Amendment or Modification of Plan.
Notwithstanding Sections 8.1 and 8.2, no termination, amendment or modification
of this Plan shall in any manner affect any Award theretofore granted under this
Plan without the written consent of the Participant or a person who shall have
acquired the right to the Award by will or the laws of descent and distribution.
SECTION 9
MISCELLANEOUS
9.1 Non-assignability of Awards. No Award shall be assignable or
transferable by the Participant except pursuant to Section 6.3 hereof.
9.2 Leaves of Absence. Unless the Administrator determines otherwise, the
vesting of an Award granted under this Plan shall not be tolled during any
unpaid leave of absence taken by a Participant.
9.3 No Rights to Employment or Provide Service. Nothing in this Plan or in
any Award granted hereunder or in any Award Agreement relating thereto shall
confer upon any individual the right to continue employment with the Company or
any Subsidiary.
9.4 Purchase Offer. The Administrator may offer to purchase, for cash or
Shares, any Award granted hereunder and such offer to purchase any Award shall
be on such terms and conditions as the Administrator establishes and
communicates to the Participant at the time the offer is extended to the
Participant.
9.5 Binding Effect. This Plan shall be binding upon the successors and
assigns of the Company.
9.6 Singular, Plural, Gender. Whenever used herein, except where the
context clearly indicates to the contrary, nouns in the singular shall include
the plural, and the masculine pronoun shall include the feminine gender.
9.7 Headings. Headings of the Sections hereof are inserted for convenience
and reference and constitute no part of this Plan.
9.8 Effective Date. This Plan shall become effective upon the Effective
Date.
9.9 Rights as Shareholder. Except as provided at Section 6.2(e), any
Participant or transferee of an Award shall have no rights as a shareholder with
respect to any Shares subject to such Award prior to the date on which the
Company issues to the Participant a certificate for unrestricted Shares pursuant
to the Plan.
9.10 Applicable Law. This Plan and the Awards granted hereunder shall be
interpreted, administered and otherwise subject to the laws of the State of
Delaware, without giving effect to the principles of conflict of laws thereof.
9.11 Reports. The Company will comply with all applicable reporting and
tax requirements applicable to Awards under the Code.
