VELOCITY FINANCIAL, INC.
2020 OMNIBUS INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AGREEMENT
This Nonqualified Stock Option Agreement, effective as of the Date of Grant (as defined below), is between Velocity Financial, Inc., a Delaware corporation (together with its successors and assigns, the Company), and the individual listed in the Award Notice as the Participant. Capitalized terms have the meaning set forth in Section 1, or, if not otherwise defined herein, in the Velocity Financial, Inc. 2020 Omnibus Incentive Plan (as it may be amended, the Plan).
1. Definitions. The following terms have the following meanings for purposes of this Agreement:
(a) Agreement means this Nonqualified Stock Option Agreement including (unless the context otherwise requires) the Award Notice.
(b) Award Notice means the notice pursuant to which Participant was granted the Option.
(c) Exercise Price means the Exercise Price listed in the Award Notice.
(d) Date of Grant means the Date of Grant listed in the Award Notice.
(e) IPO means the initial public offering of Velocity Financial, Inc.
(f) Officer means officer as defined under Rule 16a-1(f) of the Exchange Act.
(g) Participant means the Participant listed in the Award Notice.
(h) Shares means the number of shares of Common Stock listed in the Award Notice as Number of Shares Subject to Option, as adjusted in accordance with the Plan.
2. Grant of Option.
(a) Effective as of the Date of Grant, the Company hereby irrevocably grants to Participant the right and option (the Option) to purchase all or any part of the Shares, subject to and in accordance with the terms, conditions and restrictions set forth in the Plan, the Award Notice, and this Agreement. The Option will vest in accordance with the schedule set forth on the Award Notice. Any fractional Share underlying the Option shall be settled in cash within two and one-half (21⁄2) months from the Date of Grant.
(b) The Option is not intended to qualify as an Incentive Stock Option within the meaning of Section 422 of the Code.
(c) This Agreement will be construed in accordance and consistent with, and subject to, the terms of the Plan (the provisions of which are incorporated hereby by reference). In