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Exhibit
10.2.8
Private &
Confidential
CAPITAL ONE FINANCIAL
CORPORATION
2004 Stock Incentive
Plan
Performance Unit Award
Agreement
No. of Performance
Units:
THIS AGREEMENT, dated
December 10, 2007 (the “Date of Grant”), between
CAPITAL ONE FINANCIAL CORPORATION , a Delaware corporation
(“Capital One”, or the “Company”), and
(“you”) , is made pursuant and subject to the
provisions of the Company’s 2004 Stock Incentive Plan, as
amended and restated (the “Plan”) and all terms used
herein that are defined in the Plan shall have the same meaning
given them in the Plan unless they are otherwise defined
herein.
WHEREAS, Article 9 of the
Plan provides for the award from time to time in the discretion of
the Capital One Board of Directors (the “Board”) or its
Compensation Committee (the “Committee”) of performance
units, the vesting and issuance of which are subject to certain
service, performance or other conditions;
WHEREAS, through the grant of
these performance units, Capital One recognizes your past service
to the Company, and hopes to encourage and retain these services,
to give you a proprietary interest in the Company’s success,
and to align your interests with those of the Company’s
stockholders;
WHEREAS, Capital One and you
recognize that if you engage in certain activities during or
following the termination of your employment with the Company as
described herein, Capital One will no longer benefit from your
services, your interests will no longer be aligned with the
interests of the Company, and that, under these circumstances, the
Company will not receive a return benefit from the grant of the
performance units and, therefore, you should no longer be entitled
to retain the benefits of such grant;
W I
T N E S
S E T H
:
1. Grant of Performance
Units . Pursuant and subject to the terms and conditions set
forth in this Agreement and in the Plan, Capital One hereby grants
to you a target award of
performance units (the “Target Amount”) with a maximum
award of
performance units (the “Units”) as set forth in
Section 3 below .
2. Non-Transferability
. Subject to the provisions of Section 3 hereof, the right to
receive some or all of the Units and the underlying Shares related
thereto shall not be assignable or transferable, or otherwise
alienated or hypothecated or otherwise encumbered under any
circumstances. Any purported or attempted assignment, transfer,
alienation, pledge, hypothecation or encumbrance of such rights or
of the Units or the underlying Shares related thereto prior to
their issuance to you shall be null and void and shall result in
the immediate forfeiture of such rights or Units, including the
underlying Shares, and cancellation of this Agreement.
3. Lapse of
Restrictions .
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(a) |
Vesting . Except as provided in subsections 3(b) and
3(c) below, the Units shall, to the extent not theretofore vested
or forfeited as provided herein, vest on a date as determined by
the Committee after termination of the Performance Period (as
defined below) and certification of performance by the Committee,
but no later than March 15, 2011, (the “Vesting
Date”) based on the Company’s total return on its
common stock in the form of dividends and capital gains calculated
based on the 30 calendar day average closing price for the
Company’s common stock at the beginning (for the 30 calendar
day period of 12/1/2007 – 12/31/2007) and end (for the 30
calendar day period of 12/1/2010 – 12/31/2010) of the 3-year
period beginning January 1, 2008 and ending December 31,
2010 (the “Performance Period”) relative to the total
return on the common stock in the form of dividends and capital
gains of the companies listed in Appendix B attached hereto
(the “Peer Group”) during the Performance Period,
excluding any such companies that, as of the end of the Performance
Period, are no longer independent companies, and as certified by
the Committee following the end of the Performance Period. In the
event that the Performance Period should end early (e.g. on a
Change of Control) performance shall be determined using the 30
calendar day period prior to the revised Performance Period end
date. The number of Units that shall vest on the Vesting Date based
on the Company’s total return on its common stock shall be
from 0 to 200% of the Target Amount based on the percentile rank of
the Company’s total return as compared to the total return of
each company in the Peer Group (as set forth on Appendix A), with
200% of the Target Amount vesting where the Company’s total
return is superior to the total return of each company in the Peer
Group. Likewise, 100% of the Target Amount shall vest where the
Company’s total return is at the median of the total returns
of the companies in the Peer Group. No amounts shall vest where the
Company’s total return is less than the total return of each
company in the Peer Group. Award amounts are interpolated on a
straight line basis between points |
With respect to any Units
that have vested on the Vesting Date, the underlying Shares related
thereto shall be issued to you, in settlement of such vested Units,
on such Vesting Date. Dividends will be accrued and paid out as
additional shares at the time of the award. All Units, including
your rights thereto and to the underlying Shares, that do not vest
on or before the Vesting Date, as provided in this Section 3,
to the extent not previously forfeited as provided herein, shall
immediately be forfeited as of such Vesting Date.
The vesting of the Units and
the issuance of the underlying Shares shall be subject to Sections
7 through Section 12 of this Agreement.
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(b) |
Effect of Termination of Employment . |
(i) Upon your termination of
employment with Capital One for any reason other than death,
Disability or by Capital One not for “Cause” (as
defined below), prior to the Vesting Date all Units, to the extent
not theretofore vested as provided herein, shall immediately be
forfeited.
(ii) Upon your termination of
employment by Capital One not for “Cause” (as defined
below) or upon your Disability on or before December 31, 2010,
the number of Units that will vest and the number of underlying
Shares that will become issuable to you shall be equal to the
product of (x) the number of Units that would have vested on
the Vesting Date if you had remained employed with the Corporation
through December 31, 2010, and (y) a fraction, the
numerator of which is the number of complete months from
January 1, 2008 through the date of termination of your
employment and the denominator of which is 36. Such Units shall
vest and the underlying Shares shall become issuable to you on the
Vesting Date. Upon your termination of Capital One not for
“Cause” (as defined below”) or upon your
Disability on or after January 1, 2011, but prior to the
Vesting Date, the number of Units that shall vest on the Vesting
Date and the number of underlying Shares that shall be issuable to
you shall be as calculated in 3(a) above.
For the purposes of this
Agreement, “Cause” shall be defined as the
willful and continued failure by you to perform substantially your
duties with the Company or any affiliated company (other than any
such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is
delivered to you by the Board, the Committee, or the Chief
Executive Officer of the Company that specifically identifies the
manner in which the Board, the Committee or the Chief Executive
Officer of the Company believe that you have not substantially
performed your duties, or the willful engaging by you in illegal
conduct or gross misconduct that is materially and demonstrably
injurious to the Company.
For purposes of this Section
(b)(ii), no act or failure to act, on your part shall be considered
“willful” unless it is done, or omitted to be done, by
you in bad faith or without reasonable belief that your action or
omission was in the best interests of the Company. Any act, or
failure to act, based upon (A) authority given pursuant to a
resolution duly adopted by the Board, or if the Company is not the
ultimate parent corporation of the affiliated companies and is not
publicly-traded, the board of directors of the ultimate parent of
the Company (the “ Applicable Board ”),
(B) the instructions of the Chief Executive Officer of the
Company (unless you are the Chief Executive Officer at the time of
any such instruction) or (C) the advice of counsel for the
Company shall be conclusively presumed to be done, or omitted to be
done, by you in good faith and in the best interests of the
Company. The cessation of your employment shall not be deemed to be
for Cause unless and until there shall have been delivered to you a
copy of a resolution duly adopted by the affirmative vote of not
less than three-quarters of the entire membership of the Applicable
Board (excluding you, if you are a member of the Applicable Board)
at a meeting of the Applicable Board called and held for such
purpose (after reasonable notice is provided to the you and you are
given an opportunity, together with your counsel, to be heard
before the Applicable Board), finding that, in the good faith
opinion of the Applicable Board, you are guilty of the conduct
described in this Section (b)(ii) , and specifying the particulars
thereof in detail.
(iii) Upon your death on or
prior to December 31, 2010, the Units shall immediately vest
and the underlying shares shall be immediately issuable to you on
the vesting date as described in this Section 3(b)(iii);
provided that the number of such Units and such underlying Shares
shall be equal to the product of (x) the Target Award amount
as specified above and (y) a fraction, the numerator of which
is the number of complete months from January 1, 2008, through
the date of such death and the denominator of which is 36; and
provided further that in such case the Vesting Date shall be as
soon as practicable following your death and in all events on or
before March 15 of the year following the year of such death.
Upon your death on or after January 1, 2011, but prior to the
Vesting Date, the number of Units that shall vest and the number of
underlying Shares that shall be issuable to you shall be as
calculated in 3(a) above.
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(c) |
Effect of Change of Control . Upon a Change of Control,
as defined in the Plan, the Units shall vest and the underlying
Shares shall become issuable to you in full after the closing date
of the transaction giving rise to the Change in Control, provided
that, after such Change of Control, the number of Units that shall
vest and the number of underlying Shares that shall be issuable to
you shall be calculated based on a performance period from
January 1, 2008 through the closing date of the transaction
giving rise to the Change in Control; and provided further that the
Vesting Date in such case shall be as soon as practicable after the
closing date of the transaction and certification of performance by
the Committee, and in all events on or before March 15 of the
year following the year of such Change of Control. |
4. Six-Month Deferral
. Notwithstanding anything to the contrary in this Agreement, with
respect to any Units that have vested on the respective Vesting
Date, the underlying shares related thereto shall be issued to you,
in settlement of such vested Units, on the first day that is at
least six (6) months after your employment with the Company is
terminated for any reason to the extent
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