Exhibit 10.8
LEGG MASON, INC. 1996 EQUITY
INCENTIVE PLAN
RESTRICTED STOCK AWARD
AGREEMENT
Legg Mason, Inc. (the “
Company ”) hereby grants to you (the “
Participant ”), pursuant to the Legg Mason, Inc.
1996 Equity Incentive Plan, as amended (the “ Plan
”), an award of restricted shares of the Company’s
Common Stock (the “ Award ”), upon and subject
to the restrictions, terms and conditions set forth below.
This document constitutes Participant’s “Award
Notification”. By electronically accepting the Award, you are
acknowledging your acceptance of the Award subject to the
restrictions and upon the terms and conditions set forth in this
Agreement and the Plan. The number of shares of restricted stock
included in the Award shall be as set forth on the third party
website pursuant to which this Award Notification is electronically
delivered to Participant and in the books and records of the
Company, which shall control, absent manifest error, in the event
of a discrepancy. The Grant Date for this Award shall for all
purposes by May 18, 2009.
This Award is subject in all
respects to the applicable provisions of the Plan. Such
provisions are incorporated herein by reference and made a part
hereof. Capitalized terms that are not defined in
Section 5.7 below are defined in the Plan and shall have the
meanings specified in the Plan.
In addition to the terms, conditions
and restrictions set forth in the Plan, all terms, conditions and
restrictions set forth in this Agreement are applicable to the
Award granted hereby.
1.
RIGHTS AS A
STOCKHOLDER.
Until the Shares subject to this
Award have vested under Section 3, Participant shall have no
ordinary rights as a stockholder with respect to such Shares other
than the right to receive dividends or distributions on the Shares
as set out below. Therefore, until the Shares subject to this
Award have vested, Participant shall have no rights to vote the
underlying Shares or to take physical possession of or transfer the
Shares. Notwithstanding the foregoing, the Company, in its
sole discretion, may elect to permit Participant to vote unvested
Shares subject to this Award at one or more meetings of
stockholders of the Company. Commencing on the Grant Date,
Participant shall have the right to receive dividends and other
distributions on the Shares that are the subject of this Award
unless and until such Shares are forfeited pursuant to
Section 3 hereof; provided , however , that any
dividend or other distribution (including, without limitation, a
stock dividend or stock split) that is not a cash dividend or
distribution shall be delivered to the Company, shall be held by
the Company in accordance with Section 2 below and shall be
subject to the same vesting schedule and other restrictions as the
Shares with respect to which such dividend or other distribution
was made. In connection with the payment of such dividends or
other distributions, the Company may deduct any taxes or other
amounts required by any governmental authority to be withheld and
paid over to such authority for the account of Participant or may
include such dividend or distribution in the payroll of
Participant’s employer so that such dividend or distribution
is included within the compensation of Participant for withholding
and other taxation purposes. Participant shall be entitled to
retain cash dividends
and distributions received regardless of whether
the Shares with respect to which such dividends or distributions
were made are subsequently forfeited pursuant to Section 3
hereof. Notwithstanding anything to the contrary, prior to
the date on which the Shares subject to this Award vest pursuant to
Section 3 hereof, such Shares shall be subject to the
restrictions on transferability contained in Section 4.1
hereof.
2.
CUSTODY AND DELIVERY OF
SHARES.
Shares subject to this Award (and
any related property received under Section 1 hereof) shall be
issued in street name to an account of the Company and held in such
account until the Shares have vested under Section 3
hereof. Participant may not receive or take possession of any
unvested Shares subject to this Award, either through physical
share certificates or through book-entry accounts held by, or in
the name of, Participant. The Company may commingle the
unvested Shares subject to this Award with other shares of
restricted stock or other equity awards granted to other employees
under the Plan. The Company shall not allow any transfers of
unvested Shares subject to this Award from its account, other than
transfers to another account of the Company. The Company may
hold unvested Shares subject to this Award at any financial
institution or other custodian that it from time to time chooses,
in its sole discretion, and shall not be responsible to Participant
for any losses or damages resulting from the choice of, or actions
or omissions of, any financial institution or other custodian that
holds unvested Shares on behalf of the Company. The Company
shall deliver Shares subject to this Award that have vested
pursuant to Section 3 below to Participant through book entry
transfer to an account in Participant’s name at a financial
institution, which may, but is not required to be, the institution
or other custodian that holds the unvested Shares on behalf of the
Company. Share certificates representing vested Shares shall
not be issued by the Company until such Shares have been delivered
to Participant’s account as specified above.
Participant hereby authorizes the Company, and any financial
institution or other custodian at which the Company establishes an
account in which the Shares subject to this Award are held, to hold
all unvested shares as discussed above, to transfer any vested
shares to Participant’s account as discussed above and to
transfer to the Company and cancel any Shares subject to this Award
that are forfeited pursuant to Section 3 below. The
Company shall pay all original issue or transfer taxes and all fees
and expenses incident to the delivery of any Shares hereunder;
provided that the Company shall not pay the expenses related to any
sale of vested Shares subject to this Award, regardless of whether
such sale is made to satisfy expenses or withholding or other
taxes.
3.
VESTING AND
FORFEITURE.
(a)
Except as otherwise provided in the
Plan or in Section 3(b) of this Agreement, twenty-five
percent (25%) of the Shares subject to Participant’s Award
shall vest, shall be delivered to an account of Participant, shall
become transferable and shall cease to be subject to forfeiture on
each of April 30, 2010, April 2011, April 30, 2012
and April 30, 2013 (each, a “ Vesting Date
”). In the event that a Vesting Date is not a trading
day, then vesting shall occur on the previous trading
day.
(b)
Participant’s right to vest in
this Award is conditioned upon Participant’s continuous
employment with the Firm, except to the limited extent to which
vesting may continue following a termination of Participant’s
employment as provided below.
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If Participant’s continuous employment
with the Firm terminates or is interrupted for any reason stated
below, Participant’s rights with respect to the Award shall
be affected as follows:
(1)
Resignation
. Except as otherwise provided
below, if Participant resigns or otherwise terminates his or her
employment with the Firm for any reason, Participant’s
unvested Award shall be forfeited and Participant’s vested
but undistributed Award (if any) shall be distributed to
Participant in accordance with Section 2 hereof.
(2)
Disability
. Upon termination of
Participant’s employment with the Firm by reason of his or
her Disability, on the date of such termination,
Participant’s unvested Award shall be 100% vested and all
restrictions upon the Shares subject to Participant’s Award
shall lapse. Participant’s vested Award shall be
distributed to Participant in accordance with Section 2
hereof.
(3)
Death . Upon termination of
Participant’s employment with the Firm due to death, on the
date of such termination, Participant’s unvested Award shall
be 100% vested and all restrictions upon the Shares subject to
Participant’s Award shall lapse. Participant’s
vested Award shall be distributed to his or her beneficiaries in
accordance with Section 4.2 hereof.
(4)
Termination
for Cause . Upon termination of
Participant’s employment by the Firm for Cause,
Participant’s unvested Award shall be immediately
forfeited.
(5)
Change of Control
. In the event of a Change of
Control, then, as of the date of such Change of Control,
Participant’s unvested Award shall be 100% vested and all
restrictions upon the Shares subject to Participant’s Award
shall lapse. Participant’s vested Award shall be
distributed to Participant in accordance with Section 4.2
hereof.
(6)
Termination
without Cause . Except as otherwise
specified in this Section 3(b), upon a termination of
Participant’s employment by the Firm without Cause,
Participant’s unvested Award shall be immediately
forfeited.
(7)
Termination of
Employment when Satisfying the “Rule of
15.” If Participant’s
employment with the Firm terminates before the date on which all
Shares subject to Participant’s Award have vested and
(i) Participant, at the time of such termination, has
completed 15 years of service with the Firm and (ii) such
termination of employment is without Cause, then the unvested
portion of Participant’s Award shall continue to vest in
accordance with Section 3(a) as long as Participant does
not engage in Competitive Activity. If Participant engages in
Competitive Activity, then the
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portion of
Participant’s Award that is unvested at the time Participant
engages in such activity shall be immediately forfeited. In
the event of Participant’s death during the period in which
unvested Awards are continuing to vest under this clause (7), then,
as of the date the Company becomes aware of such death,
Participant’s unvested Award shall be 100% vested and all
restrictions upon the Shares subject to Participant’s Award
shall lapse. Participant’s vested Award shall be
distributed in accordance with Section 4.2 hereof.
(8)
Termination of
Employment Due to Retirement. If
Participant’s employment with the Firm terminates before the
date on which all Shares subject to Participant’s Award have
vested and (i) the reason for such termination is
Participant’s retirement pursuant to Section 7.1 (or any
successor retirement provision) of the Legg Mason Profit Sharing
Plan and (ii) such termination of employment is without Cause,
then the unvested portion of Participant’s Award shall
continue to vest in accordance with Section 3(a) as long
as Participant does not engage in Competitive Activity. If
Participant engages in Competitive Activity, then the portion of
Participant’s Award that is unvested at the time Participant
engages in such activity shall be immediately forfeited. In
the event of Participant’s death during the period in which
unvested Awards are continuing to vest under this clause (8), then,
as of the date the Company becomes aware of such death,
Participant’s unvested Award shall be 100% vested and all
restrictions upon the Shares subject to Participant’s Award
shall lapse. Participant’s vested Award shall be
distributed in accordance with Section 4.2 hereof.
(9)
Reduction in Workforce
. If Participant’s
employment with the Firm terminates before the date on which all
Shares subject to Participant’s Award have vested and
(i) such termination is due to the elimination of
Participant’s position in connection with a reduction in
workforce by the Firm and (ii) such termination of employment
is without Cause, then, as of the date of such termination,
Participant’s unvested Award shall be 100% vested and all
restrictions upon the Shares subject to Participant’s Award
shall lapse. Participant’s vested Award shall be
distributed to Participant in accordance with Section 4.2
hereof.
To the extent that Section 409A of the Code
applies to the vesting or distribution of any shares hereunder,
then any vesting or distribution made in connection with or
following the Participant’s separation from service (within
the meaning of Section 409A(a)(2)(A)(i) of the Code and
the regulations issued thereunder) shall not be made earlier than
the first business day of the seventh month following the
Participant’s Separation from Service, or if earlier the date
of death of the Participant. Any vesting or distribution that
is delayed in accordance with the foregoing
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sentence shall be made on the first business day
following the expiration of such six (6) month
period.
4.
ADDITIONAL TERMS AND CONDITIONS
OF THE AWARD.
4.1.
NONTRANSFERABILITY OF
SHARES.
Prior to the date on which Shares
subject to this Award vest pursuant to Section 3 hereof, such
Shares may not be sold, transferred, assigned, pledged,
hypothecated, encumbered or otherwise disposed of (whether by
operation of law or otherwise) or be subject to execution,
attachment or similar process. Any such attempted sale,
transfer, assignment, pledge, hypothecation or encumbrance, or
other disposition of such Shares shall be null and void.
4.2.
BENEFICIARIES.
Participant may designate in writing, on a form
to be prescribed by and filed with the Committee, a beneficiary to
receive all or part of the Shares to be distributed under the Plan
in the event of Participant’s death. A designation of a
beneficiary may be replaced by a new designation or may be revoked
by Participant at any time and in accordance with such
rules and procedures established by the Committee on a form
prescribed by and filed with the Committee. In the event of
Participant’s death, Shares due under the Plan with respect
to which a designation of a beneficiary has been made (to the
extent it is valid and enforceable under applicable law) shall be
distrib
