Xxxxxxx 00.0
XXX Xxxxx Investment Corporation
Stock Option Agreement
No. of shares subject to option: 1,021,900
THIS AGREEMENT dated as of the 17th day of December, 0000,
xxxxxxx XXX XXXXX INVESTMENT CORPORATION, a Virginia corporation (the
"Company"), and FRIEDMAN, BILLINGS, XXXXXX INVESTMENT MANAGEMENT, INC.
(the "Manager"), provides as follows:
1. Grant of Option. The Company, on December 17, 1997 (the
"Date of Grant"), granted to the Manager, subject to the terms and conditions
herein set forth, the right and option to purchase from the Company all or any
part of an aggregate of 1,021,900 shares of common stock of the Company ("Common
Stock") at the option price of $20 per share (the "Option"). This Option is not
intended to be a statutory stock option under Sections 421 and 422 of the
Internal Revenue Code of 1986, as amended, (the "Code"). This Option will be
exercisable as hereinafter provided.
2. TERMS and CONDITIONS. This Option is subject to the
following terms and conditions:
(a) Expiration Date. This Option shall expire at 11:59 p.m. on
December 16, 2007 (the "Expiration Date").
(b) Exercise of Option. This Option shall be exercisable with
respect to all or part of the shares of Common Stock subject
to this Option on the Date of Grant. This Option shall
continue to be exercisable until the Expiration Date. A
partial exercise of this Option shall not affect the Manager's
right to exercise this Option with respect to the remaining
shares, subject to the conditions of this Agreement.
(c) Method of Exercise and Payment for Shares. This Option
shall be exercised by written notice delivered to the
attention of the Company's Secretary at the Company's
principal office in Arlington, Virginia. The exercise date
shall be (i) in the case of notice by mail, the date of
postmark, or (ii) if delivered in person, the date of
delivery. Such notice shall be accompanied by payment of the
option price in full, in cash or cash equivalent acceptable to
the Company, or by the surrender of shares of common stock
with an aggregate fair market value (determined as of the
preceding business day) which, together with any cash or cash
equivalent paid by the Manager, is not less than the option
price of the number of shares of Common Stock for which the
Option is being exercised.
(d) Transferability. The Manager may transfer this Option, in
whole or in part, to one or more employees of the Manager, one
or more persons (including Blackrock Financial Management,
Inc., the Mortgage Portfolio Manager) who provide services to
the Manager in connection with the management of the Company,
or a combination thereof (each such transferee a "Holder").
The Holder of this Option shall be subject to the terms and
conditions of this Agreement as if the Holder were the Manager
(other than the right to transfer this Option pursuant to the
preceding sentence) and such other terms and conditions that
are not inconsistent with this Agreement as may be prescribed
by the Manager. The Holder of this Option may not assign or
otherwise transfer his rights under this Option except that if
permitted by the Manager, the Holder may transfer his rights
under this Option by will or the laws of descent and
distribution. Except as provided in the preceding sentences,
this Option is nontransferable.
3. Compliance With Law, Etc. This Option shall not be
exercisable, no Common Stock shall be issued, no certificates for shares of
Common Stock shall be delivered, and no payment shall be made hereunder except
in compliance with all applicable federal and state laws and regulations, and
the rules of all domestic stock exchanges on which the Company's shares may be
listed. The Company shall have the right to rely on the opinion of its counsel
as to such compliance. Any share certificate issued to evidence Common Stock for
which this Option is exercised may bear such legends and statements as the
Company's Board of Directors may deem advisable or desirable. This Option shall
not be exercisable, no Common Stock shall be issued, no certificate for shares
shall be delivered, and no payment shall be made hereunder until the Company has
obtained such consent or approval as the Company's Board of Directors may deem
advisable from regulatory bodies having jurisdiction over such matters.
4. Shareholder Rights. The Manager shall not have any rights
as a shareholder of the Company except to the extent that this Option is
exercised and the Option price is paid to the Company.
5. Fractional Shares. Fractional shares shall not be issuable
hereunder, and when any provision hereof may entitle the Manager to a fractional
share such fraction shall be disregarded.
6. No Right to Continued Service. This Option does not confer
upon the Manager any right with respect to continuance of service to the
Company, nor shall it interfere in any way with the right of the Company to
terminate its service at any time.
7. Change in Capital Structure. The terms of this Option shall
be adjusted as the Company's Board of Directors determines in good faith is
equitably required in the event the Company effects one or more stock dividends,
stock split-ups, subdivisions or consolidations of shares or other similar
changes in capitalization.
8. Governing Law. This Agreement shall be governed by the laws
of the Commonwealth of Virginia.
9. Binding Effect. Subject to the limitations stated above,
this Agreement shall be binding upon and inure to the benefit of the assignees
and successors of the Manager, the successors of the Company and the legatees,
distributees and personal representatives of each Holder.
SIGNATURE PAGE FOLLOWS
IN WITNESS WHEREOF, the Company has caused this Stock Option
Agreement to be signed by a duly authorized officer, and the Manager has affixed
its signature hereto.
FBR ASSET INVESTMENT CORPORATION FRIEDMAN, BILLINGS, XXXXXX
INVESTMENT MANAGEMENT, INC.
By: /s//Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxxxx X. Xxxxxxx
---------------------------- ---------------------------
Name: Xxxxxxx X. Xxxxxxx Name: Xxxxxxxx X. Xxxxxxx
Title: Chief Operating Officer Title: Managing Director
CONSENTED TO:
FBR Holdings, Inc., as the holder of all the outstanding Common Stock
of FBR Asset Investment Corporation.
By: /s/ Xxxx X. Generous
---------------------------
Name: Xxxx X. Generous
Title: Chief Financial Officer
