EXHIBIT 10.5
OPTION GRANT
FORM OF NONQUALIFIED STOCK OPTION AGREEMENT
This NONQUALIFIED STOCK OPTION AGREEMENT (this "Agreement"),
is entered into this day of , 2002, by and between NEWCASTLE INVESTMENT CORP., a
Maryland corporation (the "Company"), and FORTRESS PRINCIPAL INVESTMENT HOLDINGS
LLC, a Delaware limited liability company and an affiliate of the Manager of the
Company (the "Optionee").
Pursuant to the Newcastle Investment Corp. Nonqualified Stock
Option and Incentive Award Plan (the "Plan"), the Optionee is hereby granted, on
the terms and conditions set forth herein (and subject to the terms and
provisions of the Plan), a nonqualified stock option (an "Option") to purchase
shares of the Company's common stock. It is intended that the Option constitute
a "nonqualified stock option" and not an "incentive stock option" within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"). This grant is subject to and conditioned upon the Optionee's agreement
to waive its right to the grant of an option upon the additional issuance of
equity interests in the Company pursuant to that certain offering memorandum
filed as of February 2002 (the "IPO") as provided for under section 5.5(b) of
the Plan, and, the Manager hereby waives such right. Any capitalized terms not
defined herein shall have the meaning set forth in the Plan.
TERMS AND CONDITIONS OF THE OPTION
1. NUMBER OF SHARES AND OPTION PRICE. The Option entitles the
Optionee to purchase [that number of shares of Newcastle stock equal to 10% of
the shares being sold in the IPO] shares (the "Option Shares") at a per share
exercise price of [the initial offering price of the shares sold in the IPO]
(the "Option Price") of the Company's common stock, par value $.01 per share
(the "Common Stock"), subject to adjustment as set forth in the Plan.
2. PERIOD OF OPTION. This Agreement and the terms of the
Option hereunder shall commence on the date hereof (the "Date of Grant") and,
unless previously terminated pursuant to this Agreement, the Option shall
terminate upon the expiration of ten (10) years from such Date of Grant.
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Upon the termination of the Option all rights of the Optionee hereunder, with
respect to the Option, shall cease.
3. CONDITIONS OF EXERCISE. Subject to the provisions of the
Plan and this Agreement, the Option shall be fully vested at all times and shall
become exercisable as to 1/30th of the shares of Common Stock subject to the
Option on the first calendar day of each of the 30 months following the Date of
Grant.
4. EXERCISE OF OPTION. The Option shall be exercised in the
following manner: the Optionee (or any subsequent party or parties having the
right to exercise the Option), shall deliver to the Company written notice
specifying the number of Option Shares to be purchased, together with either (a)
cash in an amount equal to the Option Price, (b) the number of shares of Common
Stock having a Fair Market Value (as of the date of exercise) equal to the
Option Price, or (c) any combination of cash or shares of Common Stock, the sum
of which equals the Option Price, and the Option Shares purchased shall there
upon be promptly delivered. In addition, the Optionee (or such other party)
shall be entitled to exercise the Option in any other manner permitted under the
Plan and approved by the Committee. The Optionee will not be deemed to be a
holder of any Option Shares until the date of the issuance of a stock
certificate to it for such shares and until such shares are paid for in full.
5. DISPOSITION OF OPTION SHARES. Subject to the
terms of this Agreement and the Plan, the Option and the Common
Stock acquired in connection with the exercise of the Option shall be
freely transferable by the Optionee, to the extent not prohibited by
applicable laws.
6. CHANGE IN CONTROL PROVISIONS. Notwithstanding anything
herein to the contrary, the Option and any Tandem Awards granted prior to a
Change in Control shall become immediately and fully vested and exercisable upon
a Change in Control in accordance with the provisions of the Plan. For purposes
of this award, a Change in Control shall be deemed to have occurred upon the
occurrence of one or more of the events set forth in the Plan, as amended and
restated effective January 1, 2002, or if Xxxxxx X. Xxxxx ceases to be a member
of the Board of Directors of the Company.
7. NOTICES. Any notice required or permitted under this
Agreement shall be deemed given when delivered personally, or when deposited in
a United States Post Office, postage prepaid, addressed, as
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appropriate, to the Optionee either at his address set forth below or such other
address as he or she may designate in writing to the Company, or to the Company:
1301 Avenue of the Americas, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxx X. Xxxxxxx (or his designee), at the Company's address or such other
address as the Company may designate in writing to the Optionee.
8. FAILURE TO ENFORCE NOT A WAIVER. The failure of
the Company to enforce at any time any provision of this Agreement
shall in no way be construed to be a waiver of such provision or of any
other provision hereof.
9. GOVERNING LAW. This Agreement shall be
governed by and construed according to the laws of the State of Maryland
without regard to its principles of conflict of laws.
10. INCORPORATION OF PLAN. The Plan is hereby
incorporated by reference and made a part hereof, and the Options and this
Agreement are subject to all of the terms and conditions of the Plan.
11. AMENDMENTS. This Agreement may be amended
or modified at any time by an instrument in writing signed by the parties
hereto.
12. RIGHTS AS A STOCKHOLDER. Neither the Optionee nor any
successor in interest shall have rights as a stockholder of the Company with
respect to any of the Option Shares until the date of issuance of a stock
certificate for such Option Shares.
13. AGREEMENT NOT A CONTRACT OF EMPLOYMENT. Neither the Plan,
the granting of any Option, this Option Agreement nor any other action taken
pursuant to the Plan shall constitute or be evidence of any agreement or
understanding, express or implied, that the Optionee has a right to continue its
service to the Company for any period of time at any specific rate of
compensation.
14. AUTHORITY OF THE COMMITTEE. The Committee shall have full
authority to interpret and construe the terms of the Plan and this Agreement.
The determination of the Committee as to any such matter of interpretation or
construction shall be final, binding and conclusive.
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Signatures on Following Page
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IN WITNESS WHEREOF, the parties have executed this Agreement
on this __ day of _____ , 20 .
NEWCASTLE INVESTMENT CORP.
By: ___________________________
Its:____________________________
The undersigned hereby accepts and agrees to
all the terms and provisions of the
foregoing Agreement and to all the terms and
pro visions of the Plan herein incorporated
by reference.
FORTRESS PRINCIPAL INVESTMENT
HOLDINGS LLC
By: ________________________________
Its: ________________________________
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FORM OF NEWCASTLE INVESTMENT CORP.
STOCK OPTION AGREEMENT
NOTICE OF EXERCISE
__________ , 20 __
Newcastle Investment Corp.
1301 Avenue of the Americas
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Gentlemen:
On _____ __, 2002, Fortress Principal Investment Holdings LLC,
an affiliate of the Manager (the "Optionee") was granted an Option by Newcastle
Investment Corp. (the "Company") under the Company's Nonqualified Stock Option
and Incentive Award Plan (the "Plan") and a stock option agreement, between the
Optionee and the Company, dated as of __________, 2002 (the "Agreement"). This
letter is to notify you that the Optionee wishes to purchase Option Shares under
the Agreement as set forth below.
EXERCISE OF STOCK OPTION(S)
1. The Optionee wishes to purchase _______ Option
Shares at the current exercise price of $ _____ per share for a total cost of
$_____, which Option is not encumbered to a Tandem Option.
2. The Optionee is paying for these Option Shares as
follows:
___ By enclosing cash and/or a certified or
cashier's check payable to the Company in
the amount of $_______.
___ By enclosing a stock certificate duly
endorsed for transfer or accompanied by an
appropriately
executed stock power in favor of the
Company, representing ____ shares of Stock.
3. In exercising its Option the Optionee hereby warrants and
represents to the Company that the Optionee acknowledges that the Company has no
obligation to issue a certificate evidencing any Option Shares purchasable by
the Optionee until the purchase price of such Option Shares is fully paid as set
forth in the Option Agreement.
Very truly yours,
Fortress Principal Investment
Holdings LLC
By:
-------------------------
Its:
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