PIPER JAFFRAY COMPANIES
AMENDED AND RESTATED
2003 ANNUAL AND LONG-TERM INCENTIVE PLAN
(as amended and restated
effective May 7, 2009)
The purpose of the
Plan is to promote the interests of the Company and its
stockholders by giving the Company a competitive advantage in
attracting, retaining and motivating employees, officers,
consultants and Directors capable of assuring the future success of
the Company, to offer such persons incentives that are directly
linked to the profitability of the Company’s businesses and
increases in stockholder value, and to afford such persons an
opportunity to acquire a proprietary interest in the
Company.
As used in the
Plan, the following terms shall have the meanings set forth
below.
(a) “
Affiliate ” means any entity in which the Company has,
directly or indirectly through one or more intermediaries, a
controlling interest or which has, directly or indirectly through
one or more intermediaries, a controlling interest in the Company,
within the meaning of Treasury Regulation §
1.409A-1(b)(5)(iii)(E).
(b) “
Award ” means any Stock Option, Stock Appreciation
Right, Restricted Stock, Restricted Stock Unit, Performance Award,
Dividend Equivalent, Other Stock Grant, Other Stock-Based Award or
Tax Offset Bonus granted under the Plan.
(c) “
Award Agreement ” means any written agreement,
contract or other instrument or document evidencing any Award
granted under the Plan. Each Award Agreement shall be subject to
the applicable terms and conditions of the Plan and any other terms
and conditions (not inconsistent with the Plan) determined by the
Committee.
(d) “
Board ” means the Board of Directors of the
Company.
(e) “
Code ” means the Internal Revenue Code of 1986, as
amended from time to time, and any regulations promulgated
thereunder.
(f) “
Change in Control ” has the meaning set forth in
Section 7.
(g) “
Committee ” means a committee of Directors designated
by the Board to administer the Plan, which initially shall be the
Compensation Committee of the Board. The Committee shall be
comprised of not less than such number of Directors as shall be
required to permit Awards granted under the Plan to qualify under
Rule 16b-3 and Section 162(m) of the Code, and each member of
the Committee shall be an Outside Director.
(h) “
Company ” means Piper Jaffray Companies, a Delaware
corporation.
(i) “
Covered Employee ” means a Participant designated
prior to the grant of Restricted Stock, Restricted Stock Units or
Performance Awards by the Committee who is or may be a
“covered employee” within the meaning of
Section 162(m)(3) of the Code in the year in which any such
Award is expected to be taxable to such Participant.
(j) “
Director ” means a member of the Board, including any
Outside Director.
(k) “
Dividend Equivalent ” means any right granted under
Section 6(e) of the Plan.
(l) “
Effective Date ” has the meaning set forth in
Section 11 of the Plan.
(m) “
Eligible Individual ” means any employee, officer,
Director or consultant providing services to the Company or any
Affiliate, and prospective employees and consultants who have
accepted offers of employment or consultancy from the Company or
any Affiliate, whom the Committee determines to be an Eligible
Individual.
(n) “
Exchange Act ” means the Securities Exchange Act of
1934, as amended from time to time.
(o) “
Exercise Price ” has the meaning set forth in Section
6(a) of the Plan.
(p) “
Fair Market Value ” means, with respect to any
property (including, without limitation, any Shares or other
securities), the fair market value of such property determined by
such methods or procedures as shall be established from time to
time by the Committee in good faith and in a manner consistent with
Code Section 409A. Notwithstanding the foregoing and except as
otherwise provided by the Committee, the Fair Market Value of a
Share as of a given date shall be the closing sales price for one
Share on the New York Stock Exchange or such other established
securities market as may at the time be the principal market for
the Shares, or if the Shares were not traded on such national
securities market or exchange on such date, then on the next
preceding date on which the Shares are traded, all as reported by
such source as the Committee may select.
(q) “
Non-Qualified Stock Option ” means any Stock Option
that is not designated as, or is not intended to qualify as, an
“incentive stock option” within the meaning of
Section 422 of the Code.
(r) “
Outside Director ” means any Director who qualifies as
an “outside director” within the meaning of Section
162(m) of the Code, as a “non-employee director” within
the meaning of Rule 16b-3 and as an “independent
director” pursuant to the requirements of the New York Stock
Exchange.
(s) “
Participant ” means an Eligible Individual designated
to be granted an Award under the Plan.
(t) “
Performance Award ” means any right granted under
Section 6(d) of the Plan.
(u) “
Performance Goals ” means the performance goals
established by the Committee in connection with the grant of an
Award. In the case of Qualified Performance-Based Awards,
(i) such goals shall be based on the attainment of specified
levels of one or more of the following measures with respect to the
Company or such subsidiary, division or department of
the
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Company for or
within which the Participant performances services: revenue growth;
earnings before interest, taxes, depreciation, and amortization;
earnings before interest and taxes; operating income; pre- or
after- tax income; earnings per share; cash flow; cash flow per
share; return on equity; return on tangible equity; return on
invested capital; return on assets; economic value added (or an
equivalent metric); share price performance; total shareholder
return; improvement in or attainment of expense levels; improvement
in or attainment of working capital levels and (ii) such
Performance Goals shall be set by the Committee within the time
period prescribed by Section 162(m) of the Code and related
regulations. Such Performance Goals also may be based upon the
attaining of specified levels of Company performance under one or
more of the measures described above relative to the performance of
other companies.
(v) “
Plan ” means this Piper Jaffray Companies Amended and
Restated 2003 Annual and Long-Term Incentive Plan, as set forth
herein and as hereinafter amended from time to time.
(w) “
Qualified Performance-Based Award ” means an Award of
Restricted Stock, Restricted Stock Units or Performance Awards
designated as such by the Committee at the time of grant, based
upon a determination that (i) the recipient is or may be a
Covered Employee in the year in which the Company would expect to
be able to claim a tax deduction with respect to such Restricted
Stock or Performance Awards and (ii) the Committee wishes such
Award to qualify for the Section 162(m) Exemption.
(x) “
Restricted Stock ” means any Share granted under
Section 6(c) of the Plan.
(y) “
Restricted Stock Unit ” means any unit granted under
Section 6(c) of the Plan evidencing the right to receive a Share
(or a cash payment equal to the Fair Market Value of a Share) at
some future date.
(z) “
Rule 16b-3 ” means Rule 16b-3, as
promulgated by the Securities and Exchange Commission under Section
16(b) of the Exchange Act, as amended from time to time.
(aa) “
Section 162(m) Exemption ” means the exemption
from the limitation on deductibility imposed by Section 162(m) of
the Code that is set forth in Section 162(m)(4)(C) of the
Code.
(bb) “
Share ” or “ Shares ” means a share
or shares of common stock, par value $.01 per share, of the
Company.
(cc) “
Stock Appreciation Right ” means any right granted
under Section 6(b) of the Plan.
(dd) “
Stock Option ” means a Non-Qualified Stock Option
granted under Section 6(a) of the Plan.
SECTION 3.
Administration
(a) Power
and Authority of the Committee . The Plan shall be administered
by the Committee. Subject to the terms of the Plan and to
applicable law, the Committee shall have full power and authority
to:
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(i) designate
Participants;
(ii) determine
whether and to what extent any type (or types) of Award is to be
granted hereunder;
(iii) determine
the number of Shares to be covered by (or the method by which
payments or other rights are to be determined in connection with)
each Award;
(iv) determine the
terms and conditions of any Award or Award Agreement;
(v) subject to
Section 9 hereof, amend the terms and conditions of any Award
or Award Agreement and accelerate the vesting and/or exercisability
of any Stock Option or waive any restrictions relating to any
Award; provided , however , that
(A) except for adjustments pursuant to Section 4(c) of the
Plan, in no event may any Stock Option granted under this Plan be
(x) amended to decrease the Exercise Price thereof,
(y) cancelled in conjunction with the grant of any new Stock
Option with a lower Exercise Price, or (z) otherwise subject to any
action that would be treated, for accounting purposes, as a
“repricing” of such Stock Option, unless such
amendment, cancellation, or action is approved by the stockholders
of the Company to the extent required by applicable law and stock
exchange rules and (B) the Committee may not adjust upwards
the amount payable to a Covered Employee with respect to a
Qualified Performance-Based Award or waive or alter the Performance
Goals associated therewith in a manner that would violate Section
162(m) of the Code.
(vi) determine
whether, to what extent and under what circumstances the exercise
price of Awards may be paid in cash, Shares, other securities,
other Awards or other property, or canceled, forfeited or
suspended;
(vii) determine
whether, to what extent and under what circumstances cash, Shares,
other securities, other Awards, other property and other amounts
payable with respect to an Award under the Plan shall be deferred
either automatically or at the election of the holder thereof or
the Committee;
(viii) interpret
and administer the Plan and any instrument or agreement, including
an Award Agreement, relating to the Plan;
(ix) adopt, alter,
suspend, waive or repeal such rules, guidelines and practices and
appoint such agents as it shall deem advisable or appropriate for
the proper administration of the Plan; and
(x) make any other
determination and take any other action that the Committee deems
necessary or desirable for the administration of the
Plan.
Unless
otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with
respect to the Plan or any Award or Award Agreement shall be within
the sole discretion of the Committee, may be made at any time and
shall be final, conclusive and binding upon all persons, including
without limitation, the Company, its Affiliates, subsidiaries,
shareholders, Eligible Individuals and any holder or beneficiary of
any Award.
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(b)
Action by the Committee; Delegation . Except to the extent
prohibited by applicable law or the applicable rules of a stock
exchange, the Committee may delegate all or any part of its duties
and powers under the Plan to one or more persons, including
Directors or a committee of Directors, subject to such terms,
conditions and limitations as the Committee may establish in its
sole discretion; provided , however , that the
Committee shall not delegate its powers and duties under the Plan
(i) with regard to officers or directors of the Company or any
Affiliate who are subject to Section 16 of the Exchange Act or
(ii) in a manner that would cause an Award designated as a
Qualified Performance-Based Award not to qualify for, or to cease
to qualify for, the Section 162(m) Exemption; and provided ,
further , that any such delegation may be revoked by the
Committee at any time.
(c) Power
and Authority of the Board . Notwithstanding anything to the
contrary contained herein, except to the extent that the grant or
exercise of such authority would cause any Award or transaction to
become subject to (or lose an exemption under) the short-swing
profit recovery provisions of Section 16 of the Exchange Act
or cause an Award designated as a Qualified Performance-Based Award
not to qualify for, or to cease to qualify for, the Section 162(m)
Exemption, the Board may, at any time and from time to time,
without any further action of the Committee, exercise the powers
and duties of the Committee under the Plan. To the extent that any
permitted action taken by the Board conflicts with action taken by
the Committee, the Board action shall control.
SECTION 4.
Shares Available for Awards
(a)
Shares Available . Subject to adjustment as provided in
Section 4(c) of the Plan, the aggregate number of Shares that may
be issued under the Plan shall be 7,000,000. Shares that may be
issued under the Plan may be authorized but unissued Shares or
Shares re-acquired and held in treasury.
(b)
Accounting for Awards . For purposes of this Section 4,
if an Award entitles the holder thereof to receive or purchase
Shares, the number of Shares covered by such Award or to which such
Award relates shall be counted on the date of grant of such Award
against the aggregate number of Shares available for granting
Awards under the Plan. Any Shares that are used by a Participant as
full or partial payment to the Company of the purchase price
relating to an Award, including in connection with the satisfaction
of tax obligations relating to an Award, shall again be available
for granting Awards under the Plan. In addition, if any Shares
covered by an Award or to which an Award relates are not purchased
or are forfeited, or if an Award otherwise terminates without
delivery of any Shares, then the number of Shares counted against
the aggregate number of Shares available under the Plan with
respect to such Award, to the extent of any such forfeiture or
termination, shall again be available for granting Awards under the
Plan.
(c)
Adjustments . In the event of any change in corporate
capitalization (including, but not limited to, a change in the
number of Shares outstanding), such as a stock split or a corporate
transaction, such as any merger, consolidation, separation,
including a spin-off, or other distribution of stock or property of
the Company (including any extraordinary cash or stock dividend),
any reorganization (whether or not such reorganization comes within
the definition of such term in Section 368 of the Code) or any
partial or complete liquidation of the Company, the Committee or
Board shall make such substitution or adjustments in the aggregate
number and kind of shares reserved for issuance under the Plan, and
the maximum limitation upon Stock Options and Stock Appreciation
Rights and other Awards to be granted
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to any
Participant, in the number, kind and Exercise Price of shares
subject to outstanding Stock Options and Stock Appreciation Rights,
in the number and kind of shares subject to other outstanding
Awards granted under the Plan and/or such other equitable
substitution or adjustments as it may determine to be appropriate
in its sole discretion (including, without limitation, the
provision of an amount in cash in consideration for any such
Awards); provided , however , that the number of
shares subject to any Award shall always be a whole number. Without
limiting the generality of the foregoing, in connection with any
Disaffiliation of a subsidiary of the Company, the Committee shall
have the authority to arrange for the assumption or replacement of
Awards with new awards based on shares of the affected subsidiary
or by an affiliate of an entity that controls the subsidiary
following the Disaffiliation. For purposes hereof,
“Disaffiliation” of a subsidiary shall mean the
subsidiary’s ceasing to be a subsidiary of the Company for
any reason (including, without limitation, as a result of a public
offering, spin-off, sale or other distribution or transfer by the
Company of the stock of the subsidiary). Notwithstanding the
foregoing, to the extent that any Award is otherwise considered to
be deferred compensation under Section 409A of the Code, any
adjustment to such Award will comply with Section 409A of the Code
(including current and future guidance issued by the Department of
Treasury and or the Internal Revenue Service).
(d) Award
Limitations . No more than 250,000 shares of Common Stock may
be subject to Qualified Performance-Based Awards granted to any
Eligible Individual in any fiscal year of the Company.
Any Eligible
Individual shall be eligible to be designated a Participant. In
determining which Eligible Individuals shall receive an Award and
the terms of any Award, the Committee may take into account the
nature of the services rendered by the respective Eligible
Individuals, their present and potential contributions to the
success of the Company or such other factors as the Committee, in
its discretion, shall deem relevant.
(a) Stock
Options . The Committee is hereby authorized to grant Stock
Options (which may only be Non-Qualified Stock Options) to Eligible
Individuals with the following terms and conditions and with such
additional terms and conditions not inconsistent with the
provisions of the Plan as the Committee shall determine:
(i) Exercise
Price . The purchase price per Share purchasable under a Stock
Option (the “ Exercise Price ”) shall be
determined by the Committee; provided , however ,
that such Exercise Price shall not be less than 100% of the Fair
Market Value of a Share on the date of grant of such Stock
Option.
(ii) Option
Term . The term of each Stock Option shall be fixed by the
Committee at the time of grant, but in no event shall be more than
10 years from the date of grant.
(iii) Time and
Method of Exercise . The Committee shall determine the time or
times at which a Stock Option may be exercised in whole or in part
and the method or methods by which, and the form or forms
(including, without limitation, cash, Shares, other securities,
other Awards or other property, or any combination thereof, having
a
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Fair Market
Value on the exercise date equal to the applicable Exercise Price)
in which, payment of the Exercise Price with respect thereto may be
made or deemed to have been made.
(b) Stock
Appreciation Rights . The Committee is hereby authorized to
grant Stock Appreciation Rights to Eligible Individuals subject to
the terms of the Plan. Each Stock Appreciation Right granted under
the Plan shall confer on the holder upon exercise the right to
receive, as determined by the Committee, cash or a number of Shares
whose Fair Market Value is equal to the excess of (A) the Fair
Market Value of one Share on the date of exercise (or, if the
Committee shall so determine in accordance with the requirements of
Code Section 409A, at any time during a specified period not
more than 30 days before or after the date of exercise) over
(B) the grant price of the Stock Appreciation Right as
determined by the Committee, which grant price shall not be less
than 100% of the Fair Market Value of one Share on the date of
grant of the Stock Appreciation Right. Subject to the terms of the
Plan, the grant price, term, methods of exercise, dates of
exercise, methods of settlement and any other terms and conditions
(including conditions or restrictions on the exercise thereof) of
any Stock Appreciation Right shall be as determined by the
Committee, provided that in no event shall the term of a
Stock Appreciation Right be longer than ten years.
(c)
Restricted Stock and Restricted Stock Units . The Committee
is hereby authorized to grant Restricted Stock and Restricted Stock
Units to Eligible Individuals with the following terms and
conditions and with such additional terms and conditions not
inconsistent with the provisions of the Plan as the Committee shall
determine:
(i)
Restrictions . Shares of Restricted Stock and Restricted
Stock Units shall be subject to such restrictions as the Committee
may impose (including, without limitation, limitation on transfer,
forfeiture conditions, limitation on the right to vote a Share of
Restricted Stock or the right to receive any dividend or other
right or property with respect thereto), which restrictions may
lapse separately or in combination at such time or times, in such
installments or otherwise as the Committee may deem appropriate.
The grant or vesting of Restricted Stock and Restricted Stock Units
may be pe
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