As
filed with the Securities and Exchange Commission on November 30, 2007.
Registration No. 333- ______
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ORIENTAL FINANCIAL GROUP INC.
(Exact Name of Registrant as Specified in its Charter)
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Commonwealth of Puerto Rico
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660538893
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(State or Other Jurisdiction of Incorporation)
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(I.R.S. Employer Identification No.)
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997 San Roberto Street
San Juan, Puerto Rico 00926
(Address of Principal Executive Offices)
ORIENTAL FINANCIAL GROUP INC.
2007 OMNIBUS PERFORMANCE INCENTIVE PLAN
(Full Title of the Plan)
José Rafael Fernández
President and Chief Executive Officer
Oriental Financial Group Inc.
Oriental Center
Professional Offices Park
997 San Roberto Street
San Juan, Puerto Rico 00926
(787) 771-6800
(Name, Address and Telephone Number, including Area Code of Agent for Service)
CALCULATION OF REGISTRATION FEE
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Title of Each Class of
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Amount to
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Proposed Maximum
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Proposed Maximum
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Amount of
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Securities to be Registered
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be Registered
1
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Offering Price per Share
2
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Aggregate Offering Price
2
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Registration Fee
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Common Stock, par value $1.00 per share
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550,000 shares
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$12.85
3
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$7,067,500
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$216.97
4
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1.
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This registration statement also covers an indeterminate number of
shares of common stock, par value $1.00 per share, that may be issued by the
Company from time to time by virtue of stock splits, stock dividends or similar
transactions in accordance with Rule 416 under the Securities Act of 1933, as
amended (the “Securities Act”).
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2.
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Estimated solely for the purpose of calculating the registration
fee pursuant to Rules 457(c) and 457(h)(1) under the Securities Act.
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3.
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Based on the average of the high and low prices of the Company’s
common stock reported on the New York Stock Exchange on
November 26, 2007.
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4.
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Total filing fee being paid.
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EXPLANATORY NOTE
The shares of common stock of Oriental Financial Group Inc. (the “Company”), par value $1.00
per share, to be offered and sold to directors, officers and employees of the Company or any
subsidiary thereof under the Oriental Financial Group Inc. 2007 Omnibus Performance Incentive Plan
are being registered by the Company on this registration statement.
PART I
INFORMATION REQUIRED IN THE PROSPECTUS
Pursuant to Part I of Form S-8, the documents containing the information specified by Part I
of Form S-8 will be sent or given to employees as specified by Rule 428(b)(1) under the Securities
Act of 1933, as amended (the “Securities Act”). Such documents are not required to be and are not
filed with the Securities and Exchange Commission (the “SEC”) either as part of this registration
statement or as prospectuses or prospectus supplements pursuant to Rule 424 under the Securities
Act. These documents and the documents incorporated by reference in this registration statement
pursuant to Item 3 of Part II of Form S-8, taken together, constitute a prospectus that meets the
requirements of Section 10(a) of the Securities Act.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The Company hereby incorporates by reference the following documents:
1. The Company’s annual report on Form 10-K for the fiscal year ended December 31, 2006, filed
with the SEC on March 28, 2007;
2. All other reports filed by the Company pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), since the end of the fiscal year covered by
the annual report referred to above, including the Company’s quarterly reports on Form 10-Q for the
quarters ended March 31, June 30, and September 30, 2007, filed with the
SEC on May 10, August 8, and November 9, 2007,
respectively, and the Company’s current reports on Form 8-K filed with the SEC on February 22,
March 6, March 28, April 4, May 3, May 15,
June 4, July 26, July 31, October 17,
October 18, October 30, November 5, and
November 6, 2007; and
3. The description of the Company’s common stock contained in its registration statement on
Form 8-B filed with the SEC on January 10, 1997.
All documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates
that all securities offered have been sold or which deregisters all securities then remaining
unsold shall be deemed to be incorporated by reference into this registration statement and to be a
part hereof from the date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this registration statement to the
extent that a
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statement contained herein or in any other subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this registration statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 1.02(B)(6) of the Puerto Rico General Corporation Law, as amended (the “PR-GCL”),
provides that a corporation may include in its certificate of incorporation a provision eliminating
or limiting the personal liability of members of its board of directors or governing body for
breach of a director’s fiduciary duties. However, no such provision may eliminate or limit the
liability of a director for breaching his duty of loyalty, failing to act in good faith, engaging
in intentional misconduct or knowingly violating a law, paying an unlawful dividend or approving an
unlawful stock repurchase, or obtaining an improper personal benefit.
Article NINTH of the Company’s certificate of incorporation, as amended, provides that the
personal liability of the directors and officers of the Company for monetary damages shall be
eliminated to the fullest extent permitted by the PR-GCL.
Section 4.08 of the PR-GCL authorizes a Puerto Rico corporation to indemnify its directors,
officers, employees and agents (if they acted in good faith and in a manner they reasonably
believed to be in, or not opposed to, the best interests of the corporation, and with respect to
any criminal action or proceeding, had no reasonable cause to believe their conduct was unlawful)
and to purchase and maintain insurance on behalf of such persons against liabilities arising out of
pending or threatened actions, suits or proceedings to which such persons are or may be made
parties by reason of being directors, officers, employees or agents of the corporation. Such
rights of indemnification are not exclusive of any other rights to which such persons may be
entitled under any by-law, agreement, vote of shareholders or otherwise.
Section 1 of article VII of the Company’s by-laws provides that any director, officer,
employee or agent of the Company shall be indemnified to the fullest extent authorized by the
PR-GCL against expenses and certain other liabilities arising out of legal action brought or
threatened against him for his conduct on behalf of the Company, provided that such person acted
in good faith and in a manner that he reasonably believed was in, or not opposed to, the Company’s
best interests. Indemnification by the Company is available in a criminal action only if such
person had no reasonable cause to believe that his conduct was unlawful.
Section 4 of article VII of the Company’s by-laws provides that the Company may
maintain insurance covering certain liabilities of directors, officers, employees and agents of the
Company, whether or not the Company would have the power or would be required to indemnify them
against such liabilities.
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ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
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Exhibit No.
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Description
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4.0
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Oriental Financial Group Inc. 2007 Omnibus Performance
Incentive Plan (incorporated by reference from the Company’s
definitive proxy statement filed with the SEC on May 23,
2007).
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5.0*
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Opinion of McConnell Valdés
LLC as to the legality of the
securities registered hereunder.
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10.1*
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Form of Qualified Stock Option Award and Agreement.
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10.2*
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Form of Restricted Stock Award and Agreement.
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23.1*
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Consent of McConnell Valdés LLC
(included in the opinion of counsel filed as Exhibit No. 5.0).
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23.2*
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Consent of KPMG LLP.
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23.3*
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Consent of Deloitte & Touche LLP.
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24.0*
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Power of attorney (included in page 5 hereof).
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ITEM 9. UNDERTAKINGS.
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective
amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act.
(ii) To reflect in the prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information set forth in the registration
statement.
(iii) To include any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to such information in
the registration statement.
Provided, however, that paragraphs (i) and (ii) above do not apply if the registration
statement is on Form S-8 and the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or furnished to the SEC by the
Company pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the registration statement.
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(2) That, for the purpose of determining any liability under the Securities Act, each such
post-effective amendment shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities, at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
The Company hereby undertakes that for purposes of determining any liability under the
Securities Act, each filing of the Company’s annual report pursuant to Section 13(a) or 15(d) of
the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted
to directors, officers and controlling persons of the Company pursuant to the foregoing provisions,
or otherwise, the Company has been advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the payment by the
Company of expenses incurred or paid by a director, officer or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by the Company is against
public policy as expressed in the Securities Act and will be governed by the final adjudication of
such issue.
SIGNATURES
The Registrant
. Pursuant to the requirements of the Securities Act, the Company certifies
that it has reasonable grounds to believe that it meets all of the requirements for filing on Form
S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the Municipality of San Juan, Commonwealth of Puerto Rico, on the
28
th
day
of November, 2007.
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ORIENTAL FINANCIAL GROUP INC.
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By:
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/s/ José Rafael Fernández
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José Rafael Fernández
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President and Chief Executive Officer
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POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints José Rafael
Fernández, José J. Gil de Lamadrid, and Norberto González, each acting singly, his or her true and
lawful attorneys-in-fact and agents, each with full power of substitution and re-substitution for
him or her and in his or her name, place and stead in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this registration statement, and any
registration statement relating to the same
offering as this registration statement that is to be effective upon filing pursuant to Rule
462(a) under the
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Securities Act, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the SEC, granting unto said attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing requisite and necessary to
be done in and about the premises, as fully to all intents and purposes as he or she might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their
substitute or substitutes, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act, this registration statement has been
signed by the following persons in the capacities and on the dates indicated:
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SIGNATURE
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TITLE
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DATE
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/s/ José J. Gil de Lamadrid
José J. Gil de Lamadrid
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Chairman
Board of Directors
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November 28, 2007
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/s/ José Rafael Fernández
José Rafael Fernández
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Director, President, and
Chief Executive Officer
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November 28, 2007
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/s/ Norberto González
Norberto González
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Executive Vice President and
Chief Financial Officer
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November 28, 2007
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/s/ Juan C. Aguayo
Juan C. Aguayo
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Director
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November 28, 2007
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/s/Pablo I. Altieri
Pablo I. Altieri
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Director
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November 28, 2007
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/s/Maricarmen Aponte
Maricarmen Aponte
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Director
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November 28, 2007
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/s/Francisco Arriví
Francisco Arriví
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Director
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November 28, 2007
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/s/ Nelson García
Nelson García
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Director
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November 28, 2007
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/s/ Pedro Morazzani
Pedro Morazzani
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Director
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November 28, 2007
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INDEX OF EXHIBITS
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Exhibit No.
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Description
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4.0
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Oriental Financial Group Inc. 2007 Omnibus Performance
Incentive Plan (incorporated by reference from the Company’s
definitive proxy statement filed with the SEC on May 23,
2007).
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5.0*
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Opinion of McConnell Valdés
LLC as to the legality of the
securities registered hereunder.
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10.1*
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Form of Qualified Stock Option Award and Agreement.
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10.2*
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Form of Restricted Stock Award and Agreement.
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23.1*
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Consent of McConnell Valdés LLC
(included in the opinion of counsel filed as Exhibit No. 5.0).
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23.2*
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Consent of KPMG LLP.
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23.3*
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Consent of Deloitte & Touche LLP.
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24.0*
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Power of attorney (included in page 5 hereof).
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Exhibit 5.0
November 30, 2007
Board of Directors
Oriental Financial Group Inc.
Oriental Center
Professional Offices Park
997 San Roberto Street
10
th
Floor
San Juan, Puerto Rico 00926
Ladies and Gentlemen:
As counsel to Oriental Financial Group Inc., a Puerto Rico corporation (the “Company”), we
have been requested to render this opinion for filing as Exhibit 5 and 23.1 to the Company’s
registration statement on Form S-8 (the “Registration Statement”), which is being filed with the
Securities and Exchange Commission (the “Commission”) on the date hereof.
The Registration Statement covers 550,000 shares (the “Shares”) of the Company’s common stock,
par value $1.00 per share, which may be issued by the Company pursuant to the Company’s 2007
Omnibus Performance Incentive Plan (the “Plan”) filed as Exhibit 4.0 to the Registration Statement.
We have examined the Company’s certificate of incorporation, as amended, the Company’s
by-laws, the Plan and related minutes of action taken by the Board of Directors and stockholders of
the Company, and such other documents and records as we have deemed appropriate. In the foregoing
examination, we have assumed the genuineness of all signatures, the authenticity of all documents
submitted to us as originals and the conformity to originals of all documents submitted to us as
certified or reproduced copies of originals.
Based on the foregoing, we are of the opinion that the Shares, when issued in accordance with
the terms and conditions of the Plan, will be duly authorized, legally issued, fully paid and
non-assessable.
Board of Directors
Oriental Financial Group Inc.
Page 2
November 30, 2007
We hereby consent to the filing of this opinion as Exhibit 5.0 to the Registration
Statement. This consent is not to be construed as an admission that we are within the category of
persons whose consent is required under Section 7(a) of the Securities Act of 1933, as amended, or
the rules and regulations of the Commission thereunder.
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Very truly yours,
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/s/ McConnell Valdés LLC
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Exhibit 10.1
AWARD NO.:
_____________
ORIENTAL FINANCIAL GROUP INC.
2007 OMNIBUS PERFORMANCE INCENTIVE PLAN
QUALIFIED STOCK OPTION AWARD AND AGREEMENT
This Qualified Stock Option Award and Agreement (the “
Award
”) is made and entered into
on this ___th day of
, 2007, by and between Oriental Financial Group Inc. (the
“
Corporation
”) and
(the “
Grantee
”). All capitalized
terms not otherwise defined herein shall have the meanings ascribed to them in the 2007 Omnibus
Performance Incentive Plan (the “
Plan
”). Whenever appropriate, words and terms used in the
singular shall be deemed to include the plural, and vice versa, and the masculine gender shall be
deemed to include the feminine gender
WHEREAS,
the Corporation has established and maintains the Plan to, among other things,
provide flexibility to the Corporation and its Affiliates to attract, retain and motivate their
directors, officers, and other key employees through the grant of awards based on performance and
to adjust their compensation practices to the best compensation practices and corporate governance
trends as they develop from time to time;
WHEREAS,
the Plan is further intended to motivate high levels of individual performance
coupled with increased shareholder returns;
WHEREAS,
the Plan is administered by the Compensation Committee of the Board of Directors of
the Corporation (the “
Plan Administrators
”);
WHEREAS,
Grantee is eligible to participate in the Plan; and
WHEREAS,
the Plan Administrators have determined that Grantee shall participate and receive
performance incentives under the Plan.
NOW, THEREFORE,
in consideration of the premises, and subject to the terms and conditions of
the Plan, the Corporation and Grantee agree as follows:
SECTION 1
.
Award
. The Corporation hereby awards
(
)
“qualified stock options” (the “
Options
”) within the meaning of Section 1046 of the Puerto
Rico Internal Revenue Code of 1994, as amended, to Grantee for the purchase from the Corporation,
at the times specified below, of an equal number of shares of Common Stock at a price of
($___) per share (the “
Exercise Price
”), which is the Fair Market
Value of the Common Stock on the date of this Award.
SECTION 2
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Exercise
. Subject to Sections 3, 4 and 5 below, the Options may be
exercised, in whole or in part (but no part fewer than fifty (50) shares) from time to time for a
period of ten (10) years beginning on the date of this Award and ending on the tenth
(10
th
) anniversary of that date, by
written notice to the Corporation (at its principal office) specifying the number of shares of
Common Stock being exercised, and accompanied by the payment of the Exercise Price: (a) in cash or
its equivalent; (b) by exchanging shares of Common Stock (which are not the subject of any pledge
or other security interest) owned by Grantee (through actual tender or by attestation); (c) with
the approval of the Plan Administrators, by authorizing the Corporation, Oriental Financial
Services Corp., or a broker-dealer approved by the Corporation, to sell, on behalf of Grantee, the
appropriate number of shares of Common Stock otherwise issuable to Grantee upon exercise of the
Options; (d) with the approval of the Plan Administrators and at the election of Grantee, by
withholding from those shares of Common Stock that would otherwise be obtained upon exercise of the
Options a number of shares having a Fair Market Value equal to the Exercise Price; or (e) by any
combination of the foregoing. In the event the Options are being exercised by any person other
than Grantee, the notice of exercise shall also be accompanied by appropriate proof of such
person’s right to exercise the Options.
SECTION 3
.
Exercise Schedule
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(a)
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Subject to Article X of the Plan regarding a Change of Control, the Options
shall become exercisable in equal annual increments of twenty-five percent (25%) of the
Options, commencing on the second anniversary of the date of this Award and thereafter
on the succeeding anniversary dates.
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(b)
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The aggregate Fair Market Value of the Common Stock on the date of this Award,
with respect to which Options may be exercised for the first time by Grantee in any
year, shall not exceed $100,000.
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(c)
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Options that become exercisable in a given year, but that are not exercised in
that year, may be exercised in any subsequent year up to their termination or
expiration date.
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SECTION 4
.
Termination of Employment
. The following provisions shall apply in the
event of Grantee’s termination of employment with the Corporation or any Affiliate:
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(a)
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Due to Death
. In the event Grantee’s employment terminates by reason
of his death, any Options that are exercisable on the date of his termination may be
exercised by Grantee’s estate or as may otherwise be provided for in accordance with
the requirements of Section 12.2 of the Plan, at any time prior to the earlier to occur
of the (i) expiration of the term of the Options or (ii) one year following Grantee’s
termination of employment.
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(b)
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Due to Disability
. In the event Grantee’s employment is terminated by
reason of his Disability, any Options that are exercisable on the date of his
termination may be exercised by Grantee (or, in the event of Grantee’s death after
termination of employment when the Option is exercisable pursuant to its terms, by
Grantee’s designated beneficiary, and if none is named, by the person determined in
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accordance with the requirements of Section 12.2 of the Plan), at any time prior to
the earlier to occur of the (i) expiration of the term of the Options or (ii) one
year following Grantee’s termination of employment.
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(c)
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Due to Cause
. In the event Grantee’s employment is terminated by the
Corporation or any Affiliate for Cause, any Options that are then not yet exercised
shall be forfeited at the time of such termination and shall not be exercisable
thereafter, and Grantee shall disgorge any profit, gain or other benefit received in
respect of the exercise of any Options for a period of twelve (12) months prior to
Grantee’s termination of employment for Cause. In the event Grantee’s employment is
terminated by the Corporation or any Affiliate for Cause, the provisions of this
paragraph will apply notwithstanding any assertion (by Grantee or otherwise) of a
termination of employment for any other reason listed under this Section.
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(d)
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Due to Resignation
. In the event Grantee’s employment ends as a result
of his resignation from the Corporation or any Affiliate, any Options that are then not
yet exercised shall be forfeited at the time of such termination and shall not be
exercisable thereafter.
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(e)
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Due to Any Other Reason
. In the event Grantee’s employment shall
terminate for any reason other than one described above, any Options that are
exercisable on the date of the termination of his employment may be exercised by him
(or, in the event of his death after termination of employment when the Option is
exercisable pursuant to its terms, by his estate or as may otherwise be provided for in
accordance with the requirements of Section 12.2 of the Plan) at any time prior to the
expiration of the term of the Options or the ninetieth (90th) day following his
termination of employment, whichever period is shorter, and any Options that are not
exercisable on the date of termination of his employment shall be forfeited at the time
of such termination and not be exercisable thereafter.
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SECTION 5.
Termination of Non-Employee Director
. In the event Grantee’s service as a
Non-Employee Director shall terminate for reasons other than removal for Cause, any Options that
are exercisable on the date of his termination may be exercised by him (or, in the event of his
death after termination as a Non-Employee Director when the Option is exercisable pursuant to its
terms, by his designated beneficiary, and if none is named, by the person determined in accordance
with the requirements of Section 12.2 of the Plan), at any time prior to the earlier to occur of
the (a) expiration of the term of the Options or (b) the ninetieth (90th) day following his
termination. In the event Grantee’s service as a Non-Employee Director is terminated for Cause,
any Options that are then not yet exercised shall be forfeited at the time of such termination and
shall not be exercisable thereafter, and Grantee shall disgorge any profit, gain or other benefit
received in respect of the exercise of any Options for a period of twelve (12) months prior to his
termination as a Non-Employee Director. In the event Grantee’s service as a Non-Employee Director
is terminated for Cause, the provisions of this paragraph will apply notwithstanding any assertion
(by Grantee or otherwise) of a termination for any other reason.
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SECTION 6.
Transferability of Award
. This Award may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of
descent and distribution. No transfer of this Award by will or by the laws of descent and
distribution shall be effective to bind the Corporation unless the Corporation shall have been
furnished with written notice thereof and a copy of the will and/or such other evidence as the
Board or the Plan Administrators may determine necessary to establish the validity of the transfer.
SECTION 7
.
Miscellaneous Provisions
.
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(a)
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This Award is subject to the terms of the Plan, which are incorporated herein
by reference.
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(b)
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The laws of the Commonwealth of Puerto Rico shall be controlling in all matters
relating to this Award.
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(d)
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The titles and captions in this Award are used only for convenience and are not
to be used in its interpretation.
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IN WITNESS WHEREOF
, the Corporation and Grantee have duly executed this Award on the date
first above written.
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ORIENTAL FINANCIAL GROUP INC.
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GRANTEE
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By:
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By:
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Name:
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Name:
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Title:
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Title:
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- 4 -
Exhibit 10.2
AWARD NO.:
_____________
ORIENTAL FINANCIAL GROUP INC.
2007 OMNIBUS PERFORMANCE INCENTIVE PLAN
RESTRICTED STOCK AWARD AND AGREEMENT
This Restricted Stock Award and Agreement (the “
Award
”) is made and entered into on
this ___th day of
, 2007, by and between Oriental Financial Group Inc. (the
“
Corporation
”) and
(the “
Grantee
”). All capitalized
terms not otherwise defined herein shall have the meanings ascribed to them in the 2007 Omnibus
Performance Incentive Plan (the “
Plan
”). Whenever appropriate, words and terms used in the
singular shall be deemed to include the plural, and vice versa, and the masculine gender shall be
deemed to include the feminine gender
WHEREAS,
the Corporation has established and maintains the Plan to, among other things,
provide flexibility to the Corporation and its Affiliates to attract, retain and motivate their
directors, officers, and other key employees through the grant of awards based on performance and
to adjust their compensation practices to the best compensation practices and corporate governance
trends as they develop from time to time;
WHEREAS,
the Plan is further intended to motivate high levels of individual performance
coupled with increased shareholder returns;
WHEREAS,
the Plan is administered by the Compensation Committee of the Board of Directors of
the Corporation (the “
Plan Administrators
”);
WHEREAS,
Grantee is eligible to participate in the Plan; and
WHEREAS,
the Plan Administrators have determined that Grantee shall participate and receive
performance incentives under the Plan.
NOW, THEREFORE,
in consideration of the premises, and subject to the terms and conditions of
the Plan, the Corporation and Grantee agree as follows:
SECTION 1
.
Award; Shareholder Rights
. The Corporation hereby awards
(
) shares of Restricted Stock (the “
Restricted Shares
”) to Grantee. The Restricted
Shares may be forfeited to, and acquired at no cost by, the Corporation as set forth in Sections 4
and 5 below. Grantee shall have all of the rights of a shareholder of the Corporation with respect
to the Restricted Shares, including but not limited to the right to vote and the right to receive
dividends.
SECTION 2.
Lapse of Restricted Period
. Subject to Article X of the Plan regarding a
Change of Control, the Restricted Period shall commence on the date of this Award and shall lapse
in its entirety on the third anniversary of the date of this Award.
SECTION 3
.
Restrictions on Sale or Transfer
. The Restricted Shares may not be sold,
assigned, transferred, pledged, hypothecated or otherwise encumbered by Grantee during the
Restricted Period. All of the Restricted Shares shall be held in book entry form with the
Corporation’s transfer agent until the restrictions lapse in accordance with the conditions
established in this Award, or until the shares are forfeited pursuant to such conditions.
Notwithstanding the foregoing, Grantee may request that, prior to the lapse of the restrictions or
forfeiture of the Restricted Shares, certificates evidencing such shares be issued in his name and
delivered to him, and each such certificate shall bear the following legend: “The shares of common
stock of Oriental Financial Group Inc. (the “Corporation”) evidenced by this certificate are
subject to acquisition by the Corporation, and such shares may not be sold or otherwise transferred
except pursuant to the provisions of the Restricted Stock Award and Agreement by and between the
Corporation and the registered owner of such shares.”
SECTION 4
.
Termination of Employment
. The following provisions shall apply in the
event of Grantee’s termination of employment with the Corporation or any Affiliate:
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(a)
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Due to Death
. In the event Grantee’s employment terminates by reason
of his death, Grantee’s estate or beneficiaries shall receive a payment calculated in
the following manner: (i) the number of Restricted Shares will be reduced by
multiplying the grant under this Award by a fraction, the numerator of which is the
number of full months in the applicable vesting period during which Grantee was an
active employee and the denominator of which is the number of months in the vesting
period set forth in Section 2 above (with a partial month worked counted as a full
month if Grantee is an active employee for 15 days or more in that month); and (ii) the
resulting reduced number of Restricted Shares shall be considered vested and payment of
such pro-rated Award is to be made to Grantee’s beneficiaries or estate as soon as
practicable after Grantee’s termination of employment.
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(b)
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Due to Disability
. In the event Grantee’s employment is terminated by
reason of his Disability, Grantee (or his estate or beneficiaries, if he subsequently
dies) shall receive a payment calculated in the following manner: (i) the number of
Restricted Shares will be reduced by multiplying the grant under this Award by a
fraction, the numerator of which is the number of full months in the applicable vesting
period during which Grantee was an active employee and the denominator of which is the
number of months in the vesting period set forth in Section 2 above (with a partial
month worked counted as a full month if Grantee is an active employee for 15 days or
more in that month); and (ii) the resulting reduced number of Restricted Shares shall
be considered vested and payment of such pro-rated Award is to be made to Grantee (his
beneficiaries or estate, if he subsequently dies) as soon as practicable after
Grantee’s termination of employment.
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(c)
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Due to Cause
. In the event Grantee’s employment is terminated by the
Corporation or any Affiliate for Cause, the remaining Restricted Shares shall be
forfeited at the
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time of such termination, and Grantee shall disgorge any profit, gain or other
benefit received in respect of the lapse of restrictions on Restricted Shares for a
period of twelve (12) months prior to the termination of his employment for Cause.
In the event Grantee’s employment is terminated by the Corporation or any Affiliate
for Cause, the provisions of this paragraph will apply notwithstanding any assertion
(by Grantee or otherwise) of a termination of employment for any other reason
enumerated under this Section.
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(d)
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Due to Resignation
. In the event Grantee’s employment ends as a result
of his resignation from the Corporation or any Affiliate, any Restricted Shares shall
be forfeited upon his termination of employment.
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SECTION 5.
Termination of Non-Employee Director
. In the event a Grantee’s service as
a Non-Employee Director shall terminate for reasons other than removal for Cause, Grantee (or his
estate or beneficiaries, if he subsequently dies) shall receive a payment calculated in the
following manner: (i) the number of Restricted Shares will be reduced by multiplying the grant
under this Award by a fraction, the numerator of which is the number of full months in the
applicable vesting period during which Grantee was an active Non-Employee Director and the
denominator of which is the number of months in the applicable vesting period (with a partial month
worked counted as a full month if Grantee is an active Non-Employee Director for 15 days or more in
that month); and (ii) the resulting reduced number of Restricted Shares shall be considered vested
and payment of such pro-rated Awards is to be made to Grantee (or his or her beneficiaries or
estate, if he subsequently dies) as soon as practicable after his termination as a Non-Employee
Director. In the event Grantee’s service as a Non-Employee Director is terminated for Cause, any
remaining Restricted Shares granted to him shall be forfeited at the time of such termination, and
Grantee shall disgorge any profit, gain or other benefit received in respect of the lapse of
restrictions on any Restricted Shares for a period of twelve (12) months prior to his termination
for Cause. In the event Grantee’s service as a Non-Employee Director is terminated for Cause, the
provisions of this paragraph will apply notwithstanding any assertion (by Grantee or otherwise) of
a termination for any other reason.
SECTION 6.
Transferability of Award
. This Award may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of
descent and distribution. No transfer of this Award by will or by the laws of descent and
distribution shall be effective to bind the Corporation unless the Corporation shall have been
furnished with written notice thereof and a copy of the will and/or such other evidence as the
Board or the Plan Administrators may determine necessary to establish the validity of the transfer.
SECTION 7
.
Miscellaneous Provisions
.
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(a)
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This Award is subject to the terms of the Plan, which are incorporated herein
by reference.
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(b)
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The laws of the Commonwealth of Puerto Rico shall be controlling in all matters
relating to this Award.
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- 3 -
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(b)
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The titles and captions in this Award are used only for convenience and are not
to be used in its interpretation.
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IN WITNESS WHEREOF
, the Corporation and Grantee have duly executed this Award on the date
first above written.
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ORIENTAL FINANCIAL GROUP INC.
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GRANTEE
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By:
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By:
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Name:
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Name:
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Title:
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Title:
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- 4 -