Exhibit 10.2
FORM OF AMENDED AND RESTATED VOTING
AGREEMENT
AMENDED AND RESTATED VOTING AGREEMENT
by and among
FRIEDMAN, BILLINGS, RAMSEY GROUP, INC.
(d/b/a ARLINGTON ASSET INVESTMENT CORP.),
FBR TRS HOLDINGS, INC.,
FBR CAPITAL MARKETS CORPORATION,
FOREST HOLDINGS (ERISA) LLC,
and
FOREST HOLDINGS LLC
dated as of
May , 2009
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS
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Section 1.1 Definitions
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2
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ARTICLE 2
BOARD COMPOSITION
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Section 2.1 Composition of the Board
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3
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Section 2.2 Composition of Subsidiary
Boards
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5
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Section 2.3 Continuing Committee
Representation
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5
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Section 2.4 Scale-Back of Crestview Board
Representation
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5
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Section 2.5 Scale-Back of FBR TRS Board
Representation
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6
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Section 2.6 Implementation.
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6
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Section 2.7 Observer Status
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6
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ARTICLE 3
COVENANTS AND OTHER
AGREEMENTS
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Section 3.1 Affiliate Transactions
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7
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Section 3.2 FBR TRS Voting
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7
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Section 3.3 Termination of the Governance
Agreement
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7
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ARTICLE 4
REPRESENTATIONS AND
WARRANTIES
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Section 4.1 Representations and
Warranties
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8
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ARTICLE 5
MISCELLANEOUS
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Section 5.1 Term
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8
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Section 5.2 Counterparts
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8
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Section 5.3 Governing Law
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9
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Section 5.4 Entire Agreement
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9
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Section 5.5 Specific
Performance
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9
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Section 5.6 Notices
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9
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Section 5.7 Assignment;
Transfers.
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10
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Section 5.8 Headings
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11
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Section 5.9 Amendments and
Waivers
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11
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Section 5.10 Interpretation; Absence of
Presumption
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11
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-i-
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Section 5.11 Severability
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11
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Section 5.12 Jurisdiction
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11
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Section 5.13 Waiver of Jury
Trial
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12
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Section 5.14 Further Assurances
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12
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Section 5.15 Recapitalization,
Etc
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12
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Section 5.16 FBR Group
Guarantee
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12
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Section 5.17 FBR TRS
Acknowledgment
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12
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Section 5.18 Acknowledgement Regarding
Director Agreement
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12
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-ii-
AMENDED AND RESTATED VOTING
AGREEMENT
THIS AMENDED AND RESTATED VOTING
AGREEMENT (this “ Agreement ”) is dated as of
May __, 2009, and is by and among Friedman, Billings, Ramsey Group,
Inc. (d/b/a Arlington Asset Investment Corp.), a Virginia
corporation (“ FBR Group ”), FBR TRS Holdings,
Inc., a Virginia corporation (“ FBR TRS ”), FBR
Capital Markets Corporation, a Virginia corporation (“
FBR ” or the “ Company ”), Forest
Holdings (ERISA) LLC, a Delaware limited liability company (“
Crestview ERISA ”), and Forest Holdings LLC, a
Delaware limited liability company (“ Crestview LLC
” and together with Crestview ERISA, “ Crestview
”). FBR Group, FBR TRS, the Company, and Crestview are
sometimes referred to herein individually as a “ Party
” and collectively as the “ Parties
”.
RECITALS
WHEREAS, FBR Group, FBR TRS, FBR and
Crestview entered into a letter agreement on June 22, 2006, as
amended on July 14, 2006, setting forth the principal terms
and conditions pursuant to which Crestview would acquire Shares
concurrently with the 144A private placement of Shares, and be
granted options to acquire additional Shares (the “
Options ”) from the Company, which letter agreement
contemplated that the parties thereto would further memorialize
their agreements with respect to such transactions in definitive
agreements;
WHEREAS, FBR and Crestview entered
into an Investment Agreement, dated as of July 19, 2006 (the
“ Investment Agreement ”), setting forth, inter
alia, the terms and conditions pursuant to which Crestview acquired
the Original Shares from the Company and was granted the
Options;
WHEREAS, following consummation of
the transactions contemplated by the Investment Agreement,
Crestview has owned a significant percentage of the equity
interests in the Company;
WHEREAS, in conjunction with the
entering into of the Investment Agreement, the Parties entered into
that certain Voting Agreement, dated as of July 20, 2006 (the
“ Voting Agreement ”), providing for, among
other things, certain voting rights of the Parties in accordance
with Section 13.1-671 of the Virginia Stock Corporation
Act;
WHEREAS, in conjunction with the
entering into of the Investment Agreement, FBR Group, FBR TRS,
Crestview ERISA, and Crestview LLC entered into that certain
Governance Agreement, dated as of July 20, 2006 (the “
Governance Agreement ”), providing for, among other
things, certain tag-along rights, rights of first offer, and rights
of first refusal;
WHEREAS, pursuant to that certain
Stock Repurchase Agreement, dated as of May
, 2009, by and between the Company,
FBR TRS and FBR Group (the “ Repurchase Agreement
”), the Company has agreed to repurchase certain Shares that
are currently held by FBR TRS;
WHEREAS, in connection with the
Repurchase Agreement and consummation of the transactions
contemplated thereby, the Parties desire to amend and restate the
Voting Agreement as more fully set forth herein; and
1
WHEREAS, in connection with the
Repurchase Agreement and consummation of the transactions
contemplated thereby, FBR Group, FBR TRS, Crestview ERISA, and
Crestview LLC desire to terminate the Governance
Agreement.
NOW, THEREFORE, in consideration of
the premises and the covenants and agreements contained herein and
for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the Parties agree as follows:
AGREEMENT
ARTICLE 1
DEFINITIONS
Section 1.1 Definitions .
Capitalized terms not defined herein shall have their respective
meanings specified in the Investment Agreement. As used in this
Agreement, the following terms shall have the following respective
meanings:
“ AAI Designees ”
shall have the meaning specified in Section 2.1
.
“ Board ” shall
mean the board of directors of the Company.
“ Cause ” shall
mean the Director’s commission of a felony or any other crime
involving moral turpitude or of a material dishonest act or fraud
against the Company or any of its Affiliates, or any act or
omission by the Director that is the result of misconduct or bad
faith and that is, or may reasonably be expected to be, materially
injurious to the Company or any of its Affiliates.
“ Crestview Designees
” shall have the meaning specified in Section 2.1
.
“ Director ”
shall mean a member of the Board.
“ Director Agreement
” shall mean that certain Director Agreement, dated as of
December 21, 2008, by and between Eric F. Billings and the
Company.
“ Independent Directors
” shall have the meaning specified in Section 2.1
.
“ Original Shares
” shall mean the number of Shares acquired by Crestview with
the Invested Capital (including Shares issued in respect of, in
exchange for or in substitution of such Shares by reason of any
Reorganization).
“ Reorganization
” shall mean any reorganization, recapitalization, stock
dividend, stock split or any similar change in the capital
structure of the Company.
“ Shares ” shall
mean shares of common stock, par value $0.001 per share, of the
Company.
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ARTICLE 2
BOARD COMPOSITION
Section 2.1 Composition of the
Board .
(a) Board . (i) From and
after the date hereof, the Board shall consist of nine Directors,
who shall be nominated as follows:
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(A)
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one Director
shall be designated for election or appointment, as applicable, by
Crestview ERISA, and one Director shall be designated for election
or appointment, as applicable, by Crestview LLC (collectively, the
“ Crestview Designees ”);
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(B)
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two Directors
shall be designated for election or appointment, as applicable, by
FBR TRS, one of which Directors shall be Eric F. Billings for so
long as he is entitled to be nominated for election to the Board
pursuant to the Director Agreement, and the other of which
Directors shall be designated for election or appointment, as
applicable, by FBR TRS after good faith consultation with the
Company, and initially shall be Ralph S. Michael, III (the “
AAI Designees ”); provided, that if Eric F. Billings
(1) is no longer entitled to be nominated for election to the
Board pursuant to the Director Agreement, or (2) no longer
desires to serve as a Director, then FBR TRS shall be entitled to
designate a replacement Director for election or appointment, as
applicable, after good faith consultation with the
Company;
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(C)
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four Directors
who shall be independent within the meaning of the rules
promulgated by the SEC and the exchange(s) on which the Shares are
listed (the “ Independent Directors ”) shall be
designated for election or appointment, as applicable, by the Board
(acting by majority vote), who shall be reasonably acceptable to
Crestview; and
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(D)
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one Director
shall be designated for election or appointment, as applicable, by
the Board (acting by majority vote), which Director shall be the
Chief Executive Officer of the Company.
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(ii)
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The Crestview
Designees, the AAI Designees, the Independent Designees and the
Chief Executive Officer of the Company will be elected or
appointed, as applicable, (or re-elected or re-appointed, as the
case may be) and seated as Directors at the Company’s next
annual meeting after the date hereof and at each annual or special
meeting thereafter.
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(b) Removal and Replacement of
Directors . Directors may be removed from office and replaced
as follows (it being understood that the following shall be
effected in a manner that is not in violation of the Virginia Stock
Corporation Act or the Articles of Incorporation or Bylaws of the
Company regarding removal of directors. That is, removal of any
director shall be subject to the approval of the holders of a
majority of the outstanding Shares):
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(i)
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Any Party may
designate any or all of its own designees for removal from the
Board (or any Subsidiary or Committee, as applicable) and may
designate a nominee for appointment to the Board to fill any
vacancy resulting from any such removal; provided ,
however , that FBR TRS shall not have authority to remove
and/or replace Eric F. Billings from the Board for so long as he is
entitled to be nominated for election to the Board pursuant to the
Director Agreement.
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(ii)
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For so long as
Crestview has the right to designate one Director nominee for
election or appointment, as applicable, to the Board pursuant to
this Article 2 , FBR TRS may not take any action to cause
the removal of a Crestview Designee except for Cause and in that
event the relevant Crestview entity may nominate a replacement for
the Director so removed.
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(iii)
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For so long as
FBR TRS has the right to designate one Director nominee for
election or appointment, as applicable, to the Board pursuant to
this Article 2 , Crestview may not take any action to cause
the removal of an AAI Designee except for Cause and in that event
FBR TRS may nominate a replacement for the Director so
removed.
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(iv)
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The Board
(acting by majority vote) shall have the right to designate for
removal any or all of the Directors (other than the Crestview
Designees and the AAI Designees) at any time and shall have the
right to designate a nominee (consistent with the provisions of
Section 2.1(a)(i)(C) and
Section 2.1(a)(i)(D) ) to fill the vacancy resulting
from any such removal or any vacancy created as a result of
Crestview or FBR TRS losing its right to designate a Director
nominee pursuant to Section 2.4 or
Section 2.5 , respectively; provided that the
Board shall consult with Crestview with respect to the selection of
a replacement for any Independent Director as provided in
Section 2.1(b)(v) .
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(v)
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For so long as
Crestview has the right to designate one Director nominee for
election or appointment, as applicable, to the Board pursuant to
this Article 2 , in the event of a vacancy created by the
departure (for any reason, including death, disability, retirement,
resignation or removal (with or without cause)) of an Independent
Director, the Board (acting by majority vote) shall have the right
to designate a replacement Independent Director who shall be
reasonably acceptable to Crestview for appointment to fill the
vacancy resulting from such departure; provided that if the
Board and Crestview are unable to agree on the replacement
Independent Director (x) the Board shall have the right to
designate the replacement Independent Director for appointment to
fill the vacancy resulting from such departure to serve until such
time as the Board and Crestview can agree on a permanent
replacement, and (y) if the Board and Crestview are unable to
agree on a permanent replacement Independent Director within 45
days after the creation of such vacancy, the remaining permanent
Independent Directors, if any, shall have the right to designate
the permanent replacement Independent Director for appointment to
fill the vacancy resulting from such departure after consultation
with both the remaining members of the Board and
Crestview.
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Section 2.2 Composition of
Subsidiary Boards . Each of the Parties agrees that, for so
long as Crestview has the right to designate one Director nominee
for election or appointment, as applicable, to the Board pursuant
to this Article 2 , Crestview shall have the right to
designate one of the Crestview Designees (or another representative
reasonably acceptable to the Board) for election or appointment, as
applicable, to the board of directors of each Subsidiary of the
Company other than the direct and indirect Subsidiaries of the
Company that are registered investment advisers; provided
that to the extent that applicable Law does not permit such
Crestview Designee (or other representative reasonably acceptable
to the Board) to serve as a member of any such Subsidiary board of
directors, such Crestview Designee shall be entitled to observer
status on such board of directors. The Company hereby agrees to
take such action (and to cause its officers and Subsidiaries to
take such action), including but not limited to voting its shares
of capital stock in each of its Subsidiaries, as shall be necessary
in order to carry out the intents and purposes of this
Section 2.2 .
Section 2.3 Continuing Committee
Representation . Each of the Parties agrees that:
(a) For so long as Crestview has the
right to designate one Director nominee for election or
appointment, as applicable, to the Board pursuant to this
Article 2 , each Committee of the Board, to the extent
permitted by applicable Law (including the rules of the exchange on
which the Shares are listed), shall have as a member at least one
Crestview Designee; provided that to the extent such
applicable Law does not permit such designee(s) to be full members
of such Committees, such designee(s) shall be entitled to observer
status on such Committees.
(b) For so long as FBR TRS has the
right to designate one Director nominee for election or
appointment, as applicable, to the Board pursuant to this
Article 2 , each Committee of the Board, to the extent
permitted by applicable Law (including the rules of the exchange on
which the Shares are listed), shall have as a member at least one
AAI Designee; provided that to the extent such applicable
Law does not permit such designee(s) to be full members of such
Committees, such designee(s) shall be entitled to observer status
on such Committees.
Section 2.4 Scale-Back of
Crestview Board Representation . Each of the Parties agrees
that:
(a) From the time
that (1) Crestview and its Affiliates who become parties to
this Agreement cease to own at least 66 2 / 3 % of the Original Shares,
Crestview LLC shall no longer be entitled to designate a nominee
for election or appointment to the Board, and (2) Crestview
and its Affiliates who become parties to this Agreement cease to
own at least 33 1 / 3 % of the number of Original
Shares, Crestview ERISA shall no longer be entitled to designate a
nominee for election or appointment to the Board, and upon either
of the foregoing, the applicable Crestview Designee shall be
replaced by an additional Independent Director nominee designated
for election or appointment to the Board by the Board (acting by
majority vote), who shall be, in the case of clause (1) above
only, reasonably acceptable to Crestview.
(b) From and after
such time as Crestview and its Affiliates cease to own at least
66 2 / 3 % o
