Patriot Capital Funding,
Inc.
EMPLOYEE RESTRICTED STOCK
PLAN
The purpose of
this Restricted Stock Plan (this “Plan”) is to advance
the interests of Patriot Capital Funding, Inc. (the
“Company”) and its wholly-owned subsidiaries by
providing to employees of the Company and employees of its
wholly-owned subsidiaries additional incentives, to the extent
permitted by law, to exert their best efforts on behalf of the
Company, to increase their proprietary interest in the success of
the Company, to reward outstanding performance and to provide a
means to attract and retain persons of outstanding ability to the
service of the Company. It is recognized that the Company’s
efforts to attract or retain these individuals will be facilitated
with this additional form of compensation.
This Plan shall be
administered by the Company’s Board of Directors
(“Board”). In its administration of the Plan, the Board
shall receive recommendations from the Compensation Committee (the
“Committee”) of the Board, which is comprised solely of
directors who are not interested persons of the Company within the
meaning of Section 2(a)(19) of the Investment Company Act of
1940, as amended (the “Act”). The Board shall interpret
this Plan and, to the extent and in the manner contemplated herein,
shall exercise the discretion reserved to it hereunder. The Board
may prescribe, amend and rescind rules and regulations relating to
this Plan and make all other determinations necessary for its
administration. The decision of the Board on any interpretation of
this Plan or administration hereof, if in compliance with the
provisions of the Act and regulations promulgated thereunder, shall
be final and binding with respect to the Company. Each issuance of
restricted stock to employees of the Company and employees of its
wholly-owned subsidiaries will be approved by the required
majority, as defined in Section 57(o) of the 1940 Act, of the Board
on the basis that such issuance is in the best interests of the
Company and its shareholders.
3. SHARES
SUBJECT TO THE PLAN
The shares subject
to this Plan shall be shares of the Company’s common stock,
par value $0.01 per share (“Shares”). Subject to the
provisions hereof concerning adjustment, the total number of shares
that may be awarded as restricted shares under this Plan shall not
exceed 2,065,045 Shares. Any Shares that were granted pursuant to
an award of restricted stock under this Plan but that are forfeited
pursuant to the terms of the Plan or an award agreement shall again
be available under this Plan. Shares may be made available from
authorized, un-issued or reacquired stock or partly from
each.
(A)
Employees. The Board shall determine and designate from time
to time those employees of the Company and those employees of its
wholly-owned subsidiaries who shall be eligible to participate in
this Plan (the “Participants”). The Board, upon the
recommendation of the Committee, shall also determine the number of
Shares to be offered from time to time to the Participants. The
Committee, in making these recommendations, and the Board, in
making these determinations, may take into account, among other
things, the past service of such Participants on behalf of the
Company and its wholly-owned subsidiaries, the present and
potential contributions of such Participants to the success of the
Company and its wholly-owned subsidiaries and such other factors as
the Committee or the Board from time to time shall deem relevant in
connection with accomplishing the purposes of this Plan.
1
(B) Award
Agreements. All Shares of restricted stock granted to
Participants under the Plan will be governed by an agreement. The
agreement documenting the award of any restricted stock granted
pursuant to this Plan shall contain such terms and conditions as
the Board from time to time shall deem advisable, including but not
limited to the lapsing of forfeiture restrictions, only in such
installments as the Board may determine or otherwise prescribe.
Agreements governing awards made to different Participants or at
different times need not contain similar provisions. In the case of
any discrepancy between the terms of the Plan and the terms of any
award agreement, the Plan provisions shall control.
Each agreement
governing an award of restricted stock shall state the number of
Shares subject to the award, the terms and conditions pursuant to
which such Participant shall acquire a non-forfeitable right to the
Shares awarded as restricted stock through the lapsing of
forfeiture provisions and the timing of the lapsing of forfeiture
provisions, all as from time to time determined or otherwise
prescribed by the Board. Shares awarded as restricted stock to some
or all of the Participants, as determined from time to time by the
Board, upon the recommenda
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