UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 13, 2013
PennyMac Financial Services, Inc.
(Exact name of registrant as specified in its charter)
Delaware |
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001- 35916 |
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80-0882793 |
(State or other jurisdiction |
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(Commission |
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(IRS Employer |
of incorporation) |
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File Number) |
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Identification No.) |
6101 Condor Drive, Moorpark, California |
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93021 |
(Address of principal executive offices) |
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(Zip Code) |
(818) 224-7442
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(e)
Equity Award Grants for Executive Officers
On June 13, 2013, the Compensation Committee of the Board of Directors of PennyMac Financial Services, Inc. (the Company) formed a Sub-Committee (the Sub-Committee), consisting of only outside directors as defined pursuant to Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended (Section 162(m)), which authorized the grant of nonstatutory stock options (each a Stock Option) and performance-based restricted stock units (RSUs), pursuant to the Companys 2013 Equity Incentive Plan, to each of Stanford L. Kurland, David A. Spector, Anne D. McCallion and Douglas Jones, all of whose compensation (excluding the principal financial officer) may satisfy the requirements of Section 162(m) that provide for the availability of certain tax deductions to the Company. The Sub-Committee also approved and adopted a form of Stock Option Award Agreement and a form of Restricted Stock Unit Award Agreement for the grant of equity awards to these executive officers.
The following table sets forth information regarding the total value of equity granted, the number of shares of the Companys Class A common stock, par value $0.001 per share (the Class A Common Stock), subject to the Stock Options (the Optioned Shares), and the number of performance-based RSUs granted to each executive officer:
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Total
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Optioned
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Performance-Based
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Stanford L. Kurland |
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$3,962,000 |
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107,656 |
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134,570 |
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David A. Spector |
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$1,499,167 |
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40,735 |
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50,919 |
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Anne D. McCallion |
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$584,500 |
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15,882 |
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19,853 |
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Douglas Jones |
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$584,500 |
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15,882 |
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19,853 |
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The form of Stock Option Award Agreement and the form of Restricted Stock Unit Award Agreement to be entered into by the Company and each executive officer in connection with the grants described above are filed hereto as Exhibit 10.1 and Exhibit 10.2, respectively, and incorporated herein by reference.
In addition, the Compensation Committee authorized the payment to Ms. McCallion of a discretionary cash bonus award from a bonus pool previously established by the Company in the amount of $258,962 as additional compensation for her performance during the 2012 calendar year. The cash bonus shall be payable during the 2014 calendar year and shall be contingent upon Ms. McCallions employment with the Company through the date of payment.
Equity Award Grants for Other Eligible Participants
On June 13, 2013, the Compensation Committee authorized the grant of (a) Stock Options to purchase a total of 164,112 Optioned Shares, (b) 177,007 performance-based RSUs, and (c) 69,127 time-based RSUs to other eligible participants pursuant to the Companys 2013 Equity Incentive Plan. The form of Stock Option Award Agreement and the form of Restricted Stock Unit Award Agreement to be entered into by the Company and the other eligible participants in connection with the grants described above are filed hereto as Exhibit 10.1 and Exhibit 10.3, respectively, and incorporated herein by reference.
Summary of Equity Award Agreements
The form of Stock Option Award Agreement provides for the award of Stock Options to purchase the Optioned Shares. In general, and except as otherwise provided by the Compensation Committee, one-third (1/3) of the Optioned Shares will vest in a lump sum on each of the first, second, and third anniversaries of the vesting commencement date, subject to the recipients continued service through each anniversary, and each Stock Option will have a term of ten years from the date of grant. Additionally, the Stock Options expire (1) immediately upon termination of the holders employment or other association with the Company for cause, (2) one year after the holders employment or other association is terminated due to death or disability and (3) three months after the holders employment or other association is terminated for any other reason.
The forms of Restricted Stock Unit Award Agreement referred to herein provide for the award of performance-based RSUs to obtain, for each RSU, a variable number of shares of the Companys Class A Common Stock and time-based RSUs to obtain, for each RSU, one share of the Companys Class A Common Stock. One-third of all time-based RSUs vest in a lump sum on each of the first, second, and third anniversaries of the vesting commencement date, subject to the recipients continued service through each anniversary. The number of shares received upon vesting of performance-based RSUs is determined based on the attainment of the performance goals, subject to conditions including continued employment throughout the performance period.
The foregoing summary is qualified in its entirety by reference to the form of award agreements filed hereto as Exhibits 10.1, 10.2, and 10.3 and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
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Description |
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10.1 |
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Form of Stock Option Award Agreement |
10.2 |
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Form of Restricted Stock Unit Award Agreement for Executive Officers |
10.3 |
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Form of Restricted Stock Unit Award Agreement For Other Eligible Participants |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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PENNYMAC FINANCIAL SERVICES, INC. |
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Dated: June 17, 2013 |
/s/ Anne D. McCallion |
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Anne D. McCallion |
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Chief Financial Officer |
Exhibit 10.1
PENNYMAC FINANCIAL SERVICES, INC.
2013 EQUITY INCENTIVE PLAN
STOCK OPTION AWARD AGREEMENT
THIS AGREEMENT is dated as of , 2013, between PennyMac Financial Services, Inc., a corporation organized under the laws of the State of Delaware (the Company ), and the individual identified in Section 1 below (the Optionee ).
1. Grant of Option. Pursuant and subject to the Companys 2013 Equity Incentive Plan (as the same may be amended from time to time, the Plan ), the Company grants to you, the Optionee identified in the table below, an option (the Option ) to purchase from the Company all or any part of a total of the number of shares identified in the table below (the Optioned Shares ) of the Class A Common Stock, par value $0.0001 per share, in the Company (the Stock ), at the exercise price per share set out in the table below.
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Number of Shares |
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Exercise Price Per Share |
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Grant Date |
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Vesting Commencement Date |
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Expiration Date |
2. Character of Option. This Option is not intended to be treated as an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended.
3. Expiration of Option. This Option shall expire at 5:00 p.m. PDT on the Expiration Date or, if earlier, the earliest of the dates specified in whichever of the following applies:
(a) If the termination of your employment or other association is on account of your death or disability, the first anniversary of the date your employment ends.
(b) If the termination of your employment or other association is due to any other reason, three (3) months after your employment or other association ends.
(c) If the Company terminates your employment or other association for cause, or at the termination of your employment or other association the Company had grounds to terminate your employment or other association for cause (whether then or
thereafter determined), immediately upon the termination of your employment or other association.
4. Vesting of Option.
(a) Until this Option expires, you may exercise it as to the number of Optioned Shares which have vested (the Vested Shares ), in full or in part, at any time on or after the applicable exercise date or dates identified in the remainder of this Section. However, during any period that this Option remains outstanding after your employment or other association with the Company and its Affiliates ends, you may exercise it only as to Optioned Shares which are Vested Shares immediately prior to the end of your employment or other association. The procedure for exercising this Option is described in Section 7.1(e) of the Plan.
(b) One-third (1/3) of the Optioned Shares shall vest in a lump sum on each of the first, second, and third anniversaries of the Vesting Commencement Date specified above, with any fractions rounded down except on the final installment.
5. Transfer of Option. You may not transfer this Option except by will or the laws of descent and distribution, and, during your lifetime, only you may exercise this Option.
6. Community Property. To the extent the you reside in a jurisdiction in which community property rules apply, without prejudice to the actual rights of the spouses as between each other, for all purposes of this Agreement, you shall be treated as agent and attorney-in-fact for that interest held or claimed by your spouse with respect to this Option and any Optioned Shares and the parties hereto shall act in all matters as if the Optionee was the sole owner of this Option and (following exercise) any such Optioned Shares. This appointment is coupled with an interest and is irrevocable.
7. Incorporation of Plan Terms. This Option is granted subject to all of the applicable terms and provisions of the Plan, including but not limited to the limitations on the Companys obligation to deliver Optioned Shares upon exercise set forth in Section 10 ( Settlement of Awards ).
8. Miscellaneous. This Agreement shall be construed and enforced in accordance with the laws of the State of Delaware, without regard to the conflict of laws principles thereof and shall be binding upon and inure to the benefit of any successor or assign of the Company and any executor, administrator, trustee, guardian, or other legal representative of you. Capitalized terms used but not defined herein shall have the meaning assigned under the Plan. The parties agree to execute such further instruments and to take such action as may reasonably be necessary to carry out the intent of this Agreement. This Agreement, including the Plan, constitute the entire agreement of the parties with respect to the subject matter hereof. This Agreement may be executed in any number of counterparts, each of which shall be an original and all of which, taken together, shall constitute one and the same instrument. In making proof of this Agreement it shall not be necessary to produce
or account for more than one such counterpart. You acknowledge that you have reviewed and understand the Plan and this Agreement in their entirety, and have had an opportunity to obtain the advice of counsel prior to executing this Agreement. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Agreement.
9. Tax Consequences. The Company makes no representation or warranty as to the tax treatment to you of your receipt or exercise of this Option or upon your sale or other disposition of the Optioned Shares. You should rely on your own tax advisors for such advice.
IN WITNESS WHEREOF , the parties have executed this Agreement as a sealed instrument as of the date first above written.
PENNYMAC FINANCIAL SERVICES, INC. |
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By: |
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Signature of Optionee |
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Title: |
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Exhibit 10.2
PENNYMAC FINANCIAL SERVICES, INC.
2013 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT
AWARD AGREEMENT
THIS AGREEMENT is dated as of , 2013, between PennyMac Financial Services, Inc., a corporation organized under the laws of the State of Delaware (the Company ), and the individual identified in the table below (the Recipient ).
Recipient
Grant Date
Vesting Commencement Date
Number of RSUs Subject to
Continued Service
Number of RSUs Subject to
Performance Components
Total Number of RSUs
Performance Period
1. Grant of Restricted Stock Units. Subject to the terms and conditions of this Award Agreement and the Companys 2013 Equity Incentive Plan, as the same may be amended, modified, supplemented or interpreted from time to time (the Plan ), including without limitation the vesting provisions set forth in Section 2, the Company hereby grants to the Recipient, with effect as of the Grant Date specified above, the above indicated number of restricted stock units (the RSUs ) to obtain (i) for each RSU that is subject to vesting based on continued service, one fully paid and nonassessable share of Class A Common Stock, par value $0.0001 per share, in the Company (the Stock ), and (ii) for each RSU that is subject to vesting based on the satisfaction of performance components, one fully paid and nonassessable share of Stock if the Variance to Target is 0% for performance components 1 and 2 and the Rating is 5 for performance component 3, all as set forth on Exhibit A attached hereto, or such greater number (up to a maximum of 1.5 shares of Stock) or lesser number as is obtained by applying the sliding scale percentage factors that are to be applied to the various performance components as set forth on such Exhibit A .
2. Vesting and Settlement.
2.1 The RSUs shall vest in accordance with the schedule set forth below.
(a) Vesting Based on Continued Service . One-third (1/3) of the RSUs subject to vesting based on continued service shall vest in a lump sum on each of the first, second,
and third anniversaries of the Vesting Commencement Date specified above, subject to the Recipients continued service through each such anniversary, with any fractions rounded down except on the final installment. The shares of Stock earned as such RSUs vest will be transferred or issued to the Recipient (or his or her estate, in the event of his or her death) promptly after the date they vest, but in any event not later than the 15th day of the third month following the end of the calendar year in which such RSUs become vested.
(b) Vesting Based on Performance Components . The RSUs subject to vesting based on satisfaction of performance components are subject to cumulative achievement of goals based on the following performance components: (1) the Companys Earnings Per Share, (2) the Companys Total Shareholder Return, and (3) the Recipients Individual Effectiveness, in the amounts and each as further described in Exhibit A attached hereto. The RSUs subject to vesting based on satisfaction of performance components shall vest in a lump sum on the date the Committee determines that the goals based on the performance components have been satisfied, subject to the Recipients continued service through such date. The Recipients satisfaction of goals based on performance components shall be determined by the Committee in its sole discretion. The shares of Stock earned as such RSUs vest will be transferred or issued to the Recipient (or his or her estate, in the event of his or her death) promptly after they vest, but in any event not later than the 15th day of the third month following the end of the calendar year in which such RSUs become vested. Notwithstanding anything to the contrary in this Agreement, if any settlement of RSUs would otherwise result in the issuance of a fractional share to the Recipient after aggregating all shares and fractional shares to be issued to the Recipient in connection with such settlement, then any such final fractional share shall be eliminated and the Company shall pay to the Recipient, in lieu thereof, cash in an amount equal to (i) the average closing price of a share of Stock during the 10 most recent trading days prior to the date of issuance of the other shares issued in settlement of such RSU, multiplied by (ii) such fractional amount.
2.2 Until the RSUs vest and are issued pursuant to the terms of this Award Agreement, the Recipient shall have no rights as a stockholder, such as the right to vote or to receive dividends in respect of the Stock covered by this Award.
2.3 The Recipients name shall be entered as the stockholder of record on the books and records of the transfer agent for the Company with respect to the Stock issuable pursuant to Section 2.1 only upon compliance to the satisfaction of the Committee with all requirements under applicable laws or regulations in connection with such issuance and with the requirements of this Agreement and of the Plan. The determination of the Committee as to such compliance shall be final and binding on the Recipient. Notwithstanding anything to the contrary in this Agreement, no Stock shall be issued in settlement of vested RSUs if the issuance of such shares would constitute a violation of any applicable federal or state securities law or other law or regulation. As a condition to the issuance of Stock to the Recipient pursuant to Section 2.1, the Company may require the Recipient to make any representation or warranty to the Company at the time vested Stock becomes issuable to the Recipient as in the opinion of legal counsel for the Company may be required by any applicable law or regulation, including the execution and delivery of an appropriate representation statement. Accordingly, the stock
certificates for the Stock issued pursuant to this Award may bear appropriate legends restricting the transfer of the Stock.
3. Effect of Termination. Unless otherwise expressly provided herein, no RSUs shall vest following the date (the Recipients Termination Date ), reasonably fixed and determined by the Committee, of the voluntary or involuntary termination of the Recipients employment or other association with all of the Company and its Affiliates, for any or no reason whatsoever, including death or disability and an entity ceasing to be an Affiliate of the Company; provided, however, that military or sick leave shall not be deemed a termination of employment or other association, if it does not exceed the longer of 90 days or the period during which the Recipients reemployment rights, if any, are guaranteed by statute or by contract. As of the Recipients Termination Date, all of the then unvested RSUs shall be forfeited by the Recipient or any transferee.
4. Restrictions on Transfer . The RSUs may not be assigned or transferred (by operation of law or otherwise) except by will or the laws of descent and distribution.
5. Miscellaneous.
5.1 No Special Service Rights. Nothing contained in this Award Agreement shall confer upon the Recipient any right with respect to the continuation of his or her employment or other association with the Company (or any Affiliate), or interfere in any way with the right of the Company (or any Affiliate), subject to the terms of any separate employment or consulting agreement or provision of law or corporate articles or by-laws to the contrary, at any time to terminate such employment or consulting agreement or to increase or decrease, or otherwise adjust, the other terms and conditions of the Recipients employment or other association with the Company and its Affiliates.
5.2 Entire Agreement; Counterparts. This Award Agreement, including the Plan, constitute the entire agreement of the parties with respect to the subject matter hereof. This Award Agreement may be executed in any number of counterparts, each of which shall be an original and all of which, taken together, shall constitute one and the same instrument. In making proof of this Award Agreement it shall not be necessary to produce or account for more than one such counterpart.
5.3 Tax Consequences. The Company makes no representation or warranty as to the tax treatment to the Recipient of receipt of these RSUs, and does not warrant to the Recipient that all compensation paid or delivered to him or her for his or her services will be exempt from, or paid in compliance with, Section 409A of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder. The Recipient should rely on his or her own tax advisors for all such advice.
5.4 Community Property. To the extent the Recipient resides in a jurisdiction in which community property rules apply, without prejudice to the actual rights of the spouses as between each other, for all purposes of this Award Agreement, the Recipient shall be treated as agent and attorney-in-fact for that interest held or claimed by the Recipients spouse
with respect to these RSUs and the parties hereto shall act in all matters as if the Recipient was the sole owner of these RSUs. This appointment is coupled with an interest and is irrevocable.
6. Receipt of Plan. The RSUs were awarded under the Plan, to which this Award Agreement is subject in all respects, including without limitation the adjustment and tax withholding provisions therein. All capitalized terms used in this Award Agreement and not otherwise defined shall have the meanings ascribed thereto in the Plan. The Recipient has reviewed and understands the Plan and this Award Agreement in their entirety, and has had an opportunity to obtain the advice of counsel prior to executing this Award Agreement. The Recipient hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Award Agreement.
IN WITNESS WHEREOF , the Recipient and the Company have entered into this Award Agreement as of the Grant Date.
PENNYMAC FINANCIAL SERVICES, INC. |
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By: |
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Signature of Recipient |
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Title: |
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PENNYMAC FINANCIAL SERVICES, INC. 2013 EQUITY INCENTIVE PLAN
Restricted Stock Unit Award Agreement
Exhibit A
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RSUs Subject to Performance |
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Recipient: |
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Components (Grant): |
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Total Potential Shares if Maximum |
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Performance Period: |
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Potential Components Satisfied: |
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PENNYMAC FINANCIAL SERVICES, INC. 2013 EQUITY INCENTIVE PLAN
Restricted Stock Unit Award Agreement
Exhibit A
Pay-Out Scale for Component 1 |
Variance to Target |
Factor |
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10% |
150% |
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0% |
125% |
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-10% |
100% |
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-17.5% |
75% |
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-25% |
50% |
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Less than -25% |
0% |
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Pay-Out Scale for Component 2 |
Variance to Target |
Factor |
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20% |
150% |
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10% |
125% |
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0% |
100% |
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-10% |
75% |
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-20% |
50% |
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Less than -20% |
0% |
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Multiplier Scale for Component 3 |
Rating |
Description |
Factor |
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5 |
Outstanding |
100% |
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4 |
Exceeds Expectations |
80% |
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3 |
Meets Expectations |
60% |
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2 |
Needs Improvement |
0% |
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1 |
Unsatisfactory |
0% |
Exhibit 10.3
PENNYMAC FINANCIAL SERVICES, INC.
2013 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT
AWARD AGREEMENT
THIS AGREEMENT is dated as of , 2013, between PennyMac Financial Services, Inc., a corporation organized under the laws of the State of Delaware (the Company ), and the individual identified in the table below (the Recipient ).
Recipient
Grant Date
Vesting Commencement Date
Number of RSUs Subject to
Continued Service
Number of RSUs Subject to
Performance Components
Total Number of RSUs
Performance Period
1. Grant of Restricted Stock Units. Subject to the terms and conditions of this Award Agreement and the Companys 2013 Equity Incentive Plan, as the same may be amended, modified, supplemented or interpreted from time to time (the Plan ), including without limitation the vesting provisions set forth in Section 2, the Company hereby grants to the Recipient, with effect as of the Grant Date specified above, the above indicated number of restricted stock units (the RSUs ) to obtain (i) for each RSU that is subject to vesting based on continued service, one fully paid and nonassessable share of Class A Common Stock, par value $0.0001 per share, in the Company (the Stock ), and (ii) for each RSU that is subject to vesting based on the satisfaction of performance components, one fully paid and nonassessable share of Stock if the Variance to Target is 0% for performance components 1 and 2 and the Rating is 4 for performance component 3, all as set forth on Exhibit A attached hereto, or such greater number (up to a maximum of 1.875 shares of Stock) or lesser number as is obtained by applying the sliding scale percentage factors that are to be applied to the various performance components as set forth on such Exhibit A .
2. Vesting and Settlement.
2.1 The RSUs shall vest in accordance with the schedule set forth below.
(a) Vesting Based on Continued Service . One-third (1/3) of the RSUs subject to vesting based on continued service shall vest in a lump sum on each of the first, second,
and third anniversaries of the Vesting Commencement Date specified above, subject to the Recipients continued service through each such anniversary, with any fractions rounded down except on the final installment. The shares of Stock earned as such RSUs vest will be transferred or issued to the Recipient (or his or her estate, in the event of his or her death) promptly after the date they vest, but in any event not later than the 15th day of the third month following the end of the calendar year in which such RSUs become vested.
(b) Vesting Based on Performance Components . The RSUs subject to vesting based on satisfaction of performance components are subject to cumulative achievement of goals based on the following performance components: (1) the Companys Earnings Per Share, (2) the Companys Total Shareholder Return, and (3) the Recipients Individual Effectiveness, in the amounts and each as further described in Exhibit A attached hereto. The RSUs subject to vesting based on satisfaction of performance components shall vest in a lump sum on the date the Committee determines that the goals based on the performance components have been satisfied, subject to the Recipients continued service through such date. The Recipients satisfaction of goals based on performance components shall be determined by the Committee in its sole discretion. The shares of Stock earned as such RSUs vest will be transferred or issued to the Recipient (or his or her estate, in the event of his or her death) promptly after they vest, but in any event not later than the 15th day of the third month following the end of the calendar year in which such RSUs become vested. Notwithstanding anything to the contrary in this Agreement, if any settlement of RSUs would otherwise result in the issuance of a fractional share to the Recipient after aggregating all shares and fractional shares to be issued to the Recipient in connection with such settlement, then any such final fractional share shall be eliminated and the Company shall pay to the Recipient, in lieu thereof, cash in an amount equal to (i) the average closing price of a share of Stock during the 10 most recent trading days prior to the date of issuance of the other shares issued in settlement of such RSU, multiplied by (ii) such fractional amount.
2.2 Until the RSUs vest and are issued pursuant to the terms of this Award Agreement, the Recipient shall have no rights as a stockholder, such as the right to vote or to receive dividends in respect of the Stock covered by this Award.
2.3 The Recipients name shall be entered as the stockholder of record on the books and records of the transfer agent for the Company with respect to the Stock issuable pursuant to Section 2.1 only upon compliance to the satisfaction of the Committee with all requirements under applicable laws or regulations in connection with such issuance and with the requirements of this Agreement and of the Plan. The determination of the Committee as to such compliance shall be final and binding on the Recipient. Notwithstanding anything to the contrary in this Agreement, no Stock shall be issued in settlement of vested RSUs if the issuance of such shares would constitute a violation of any applicable federal or state securities law or other law or regulation. As a condition to the issuance of Stock to the Recipient pursuant to Section 2.1, the Company may require the Recipient to make any representation or warranty to the Company at the time vested Stock becomes issuable to the Recipient as in the opinion of legal counsel for the Company may be required by any applicable law or regulation, including the execution and delivery of an appropriate representation statement. Accordingly, the stock
certificates for the Stock issued pursuant to this Award may bear appropriate legends restricting the transfer of the Stock.
3. Effect of Termination. Unless otherwise expressly provided herein, no RSUs shall vest following the date (the Recipients Termination Date ), reasonably fixed and determined by the Committee, of the voluntary or involuntary termination of the Recipients employment or other association with all of the Company and its Affiliates, for any or no reason whatsoever, including death or disability and an entity ceasing to be an Affiliate of the Company; provided, however, that military or sick leave shall not be deemed a termination of employment or other association, if it does not exceed the longer of 90 days or the period during which the Recipients reemployment rights, if any, are guaranteed by statute or by contract. As of the Recipients Termination Date, all of the then unvested RSUs shall be forfeited by the Recipient or any transferee.
4. Restrictions on Transfer . The RSUs may not be assigned or transferred (by operation of law or otherwise) except by will or the laws of descent and distribution.
5. Miscellaneous.
5.1 No Special Service Rights. Nothing contained in this Award Agreement shall confer upon the Recipient any right with respect to the continuation of his or her employment or other association with the Company (or any Affiliate), or interfere in any way with the right of the Company (or any Affiliate), subject to the terms of any separate employment or consulting agreement or provision of law or corporate articles or by-laws to the contrary, at any time to terminate such employment or consulting agreement or to increase or decrease, or otherwise adjust, the other terms and conditions of the Recipients employment or other association with the Company and its Affiliates.
5.2 Entire Agreement; Counterparts. This Award Agreement, including the Plan, constitute the entire agreement of the parties with respect to the subject matter hereof. This Award Agreement may be executed in any number of counterparts, each of which shall be an original and all of which, taken together, shall constitute one and the same instrument. In making proof of this Award Agreement it shall not be necessary to produce or account for more than one such counterpart.
5.3 Tax Consequences. The Company makes no representation or warranty as to the tax treatment to the Recipient of receipt of these RSUs, and does not warrant to the Recipient that all compensation paid or delivered to him or her for his or her services will be exempt from, or paid in compliance with, Section 409A of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder. The Recipient should rely on his or her own tax advisors for all such advice.
5.4 Community Property. To the extent the Recipient resides in a jurisdiction in which community property rules apply, without prejudice to the actual rights of the spouses as between each other, for all purposes of this Award Agreement, the Recipient shall be treated as agent and attorney-in-fact for that interest held or claimed by the Recipients spouse
with respect to these RSUs and the parties hereto shall act in all matters as if the Recipient was the sole owner of these RSUs. This appointment is coupled with an interest and is irrevocable.
6. Receipt of Plan. The RSUs were awarded under the Plan, to which this Award Agreement is subject in all respects, including without limitation the adjustment and tax withholding provisions therein. All capitalized terms used in this Award Agreement and not otherwise defined shall have the meanings ascribed thereto in the Plan. The Recipient has reviewed and understands the Plan and this Award Agreement in their entirety, and has had an opportunity to obtain the advice of counsel prior to executing this Award Agreement. The Recipient hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Award Agreement.
IN WITNESS WHEREOF , the Recipient and the Company have entered into this Award Agreement as of the Grant Date.
PENNYMAC FINANCIAL SERVICES, INC.
By: |
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Signature of Recipient |
Title: |
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PENNYMAC FINANCIAL SERVICES, INC. 2013 EQUITY INCENTIVE PLAN
Restricted Stock Unit Award Agreement
Exhibit A
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RSUs Subject to Performance |
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Recipient: |
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Components (Grant): |
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Total Potential Shares if Maximum |
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Performance Period: |
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Potential Components Satisfied: |
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PENNYMAC FINANCIAL SERVICES, INC. 2013 EQUITY INCENTIVE PLAN
Restricted Stock Unit Award Agreement
Exhibit A
Pay-Out Scale for Component 1 |
Variance to Target |
Factor |
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10% |
150% |
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0% |
125% |
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-10% |
100% |
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-17.5% |
75% |
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-25% |
50% |
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Less than -25% |
0% |
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Pay-Out Scale for Component 2 |
Variance to Target |
Factor |
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20% |
150% |
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10% |
125% |
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0% |
100% |
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-10% |
75% |
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-20% |
50% |
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Less than -20% |
0% |
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Multiplier Scale for Component 3 |
Rating |
Description |
Factor |
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5 |
Outstanding |
125% |
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4 |
Exceeds Expectations |
100% |
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3 |
Meets Expectations |
75% |
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2 |
Needs Improvement |
0% |
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1 |
Unsatisfactory |
0% |