Exhibit 4.2
FIRST XXXXXXXX FINANCIAL CORPORATION
1998 STOCK OPTION AND INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
NQSO NO.
This option is granted on July 29, 1998 (the "Grant Date") by First
Xxxxxxxx Financial Corporation (the "Corporation") to ____________ (the
"Optionee"), in accordance with the following terms and conditions:
1. Option Grant and Exercise Period. The Corporation hereby grants to the
Optionee an Option (the "Option") to purchase pursuant to the 1998 Stock Option
and Incentive Plan, as the same may from time to time be amended (the "Plan"),
and upon the terms and conditions therein and hereinafter set forth, an
aggregate of _____ shares (the "Option Shares") of the Common Stock, par value
$.01 per share ("Common Stock"), of the Corporation at the price (the "Exercise
Price") of $______ per share. A copy of the Plan as currently in effect, is
incorporated herein by reference and is attached hereto.
This Option shall be exercisable only during the period (the "Exercise
Period") commencing on July 29, 1998 and ending at 5:00 p.m., Xxxxxxxx, Illinois
time, on the date ten years after the Grant Date, such later time and date being
hereinafter referred to as the "Expiration Date," provided the Optionee has
maintained "Continuous Service" (as defined in the Plan) since Grant Date. This
Option shall vest and become exercisable according to the following schedule:
Date of Vesting % of the options vested
--------------- -----------------------
July 29, 1998 20%
July 29, 1999 20%
July 29, 2000 20%
July 29, 2001 20%
July 29, 2002 20%
During the Exercise Period, only the vested portion of this Option shall be
exercisable in whole at any time or in part from time to time subject to the
provisions of this Agreement.
2. Method of Exercise of This Option. This Option may be exercised at any
time during the Exercise Period by giving written notice to the Corporation
specifying the number of Option Shares to be purchased. The notice must be in
the form prescribed by the committee or its successor (the "Committee") and
directed to the address set forth in Section 10 below. The date of exercise is
the date on which such notice is received by the Corporation. Such notice must
be accompanied by payment in full for the Option Shares to be purchased upon
such exercise. Payment
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shall be made either (i) in cash, which may be in the form of a check, bank
draft, or money order payable to the Corporation, by the Committee, (ii) if the
Committee shall have approved such form of payment, by delivering shares of
Common Stock already owned by the Optionee having a Market Value (as defined in
the Plan) equal to the Exercise Price for the number of Option Shares to be
purchased, or (iii) if the Committee shall have approved such form of payment, a
combination of cash and such shares. Promptly after such payment, subject to
Section 3 below, the Corporation shall issue and deliver to the Optionee or
other person exercising this Option a certificate or certificates representing
the shares of Common Stock so purchased, registered in the name of the Optionee
(or such other person), or, upon request, in the name of the Optionee (or such
other person) and in the name of another jointly with right of survivorship.
3. Delivery and Registration of Shares of Common Stock. The Corporation's
obligation to deliver shares of Common Stock hereunder shall be conditioned upon
the receipt of a representation as to the investment intention of the Optionee
or any other person to whom such shares are to be delivered, in such form as the
Committee shall determine to be necessary or advisable to comply with the
provisions of the Securities Act of 1933, as amended, or any other federal,
state or local securities law or regulation. In requesting any such
representation, it may be provided that such representation shall become
inoperative upon a registration of such shares or other action eliminating the
necessity of such representation under such Securities Act or other securities
law or regulation. The Corporation shall not be required to deliver any shares
upon exercise of this Option prior to (i) the admission of such shares to
listing on any stock exchange or system on which the shares of Common Stock may
then be listed, and (ii) the completion of such registration or other
qualification of such shares under any state or Federal law, rule or regulation,
as the Committee shall determine to be necessary or advisable.
4. Non-Transferability of This Option. This Option may not be assigned,
encumbered, or transferred except by will or the laws of descent and
distribution or pursuant to a qualified domestic relations order, as described
in the Plan, to the extent provided in Section 5 below. Except as provided
herein, this Option is exercisable during the Optionee's lifetime only by the
Optionee. The provisions of this Option shall be binding upon, inure to the
benefit of and be enforceable by the parties hereto, the successors and assigns
of the Corporation and any person to whom this Option is transferred by will or
by the laws of descent and distribution or pursuant to a qualified domestic
relations order, as described in the Plan.
5. Termination of Service or Death of the Optionee. Except as provided in
the second or third paragraphs of this Section 5 and notwithstanding any other
provision of this Option to the contrary, this Option shall not be exercisable
unless the Optionee, at the time of exercise of this Option, has maintained
"Continuous Service" (as defined in the Plan) since the Grant Date.
If the Optionee shall cease to maintain Continuous Service for any reason
(excluding termination of employment or removal from service as a director,
advisory director or director emeritus by the Corporation or any Affiliate for
cause), the Optionee may, but only within the period of three years immediately
succeeding such cessation of Continuous Service and in no event after the
Expiration Date, exercise this Option to the extent the Optionee was entitled to
exercise this Option at the date of cessation. If the Continuous Service of the
Optionee is terminated by the Corporation or an Affiliate for cause, all rights
under this Option shall expire immediately upon the giving to the Optionee of
notice of such termination.
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In the event of the death of the Optionee while in Continuous Service of
the Corporation or during the three-year period referred to in the immediately
preceding paragraph, the person to whom the Option has been transferred by will
or by the laws of descent and distribution, or pursuant to a qualified domestic
relations order, as described in the Plan, may, but only to the extent the
Optionee was entitled to exercise this Option upon his death, exercise this
Option at any time within one year following the death of the Optionee, but in
no event after the Expiration Date. Following the death of the Optionee, the
Committee may, as an alternative means of settlement of this Option, elect to
pay to the person to whom this Option is transferred by will or by the laws of
descent and distribution or pursuant to a qualified domestic relations order, as
described in the Plan, the amount by which the Market Value (as defined in the
Plan) per share of Common Stock on the date of exercise of this Option shall
exceed the Exercise Price per Option Share, multiplied by the number of Option
Shares with respect to which this Option is properly exercised. Any such
settlement of this Option shall be considered an exercise of this Option for all
purposes of this Option and of the Plan. If the Optionee shall cease to maintain
Continuous Service due to death or disability, this Option shall become
exercisable in full upon the happening of such event and remain exercisable (i)
in the event of death for the one-year period described above or (ii) in the
event of disability or retirement for the three-year period immediately
following such person's termination of service, but in no event shall this
Option be exercisable after the Expiration Date.
6. Effect of Merger. In the event of any merger, consolidation or
combination of the Corporation (other than a merger, consolidation, or
combination in which the Corporation is the continuing entity and which does not
result in the outstanding shares of Common Stock being converted into or
exchanged for different securities, cash or other property, or any combination
thereof) pursuant to a plan or agreement the terms of which are binding upon all
stockholders of the Corporation (except to the extent that dissenting
stockholders may be entitled, under statutory provisions or provisions contained
in the certificate of incorporation, to receive the appraised or fair value of
their holdings), the Optionee shall, provided the Option has been granted at
least six months prior to such event, have the right (subject to the provisions
of the Plan and the limitations contained herein), thereafter and during the
Exercise Period, to receive upon exercise of this Option an amount equal to the
excess of the fair market value on the date of such exercise of the securities,
cash or other property, or combination thereof, receivable upon such merger,
consolidation or combination in respect of a share of Common Stock over the
Exercise Price, multiplied by the number of Option Shares with respect to which
this Option shall have been exercised. Such amount may be payable fully in cash,
fully in one or more of the kind or kinds of property payable in such merger,
consolidation or combination, or partly in cash and partly in one or more of
such kind or kinds of property, all in the discretion of the Committee.
7. Adjustments for Changes in Capitalization of the Corporation. In the
event of any change in the outstanding shares of Common Stock by reason of any
reorganization, recapitalization, stock split, stock dividend, combination or
exchange of shares, merger, consolidation, or any change in the corporate
structure of the Corporation or in the shares of Common Stock, the number and
class of shares covered by this Option and the Exercise Price shall be
appropriately adjusted by the Committee, whose determination shall be
conclusive.
8. Stockholder Rights Not Granted by This Option. The Optionee is not
entitled by virtue hereof to any rights of a stockholder of the Corporation or
to notice of meetings of stockholders or to notice of any other proceedings of
the Corporation.
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9. Withholding Tax. Where the Optionee or another person is entitled to
receive Option Shares pursuant to the exercise of this Option, the Corporation
shall have the right to require the Optionee or such other person to pay to the
Corporation the amount of any taxes which the Corporation or any of its
Affiliates is required to withhold with respect to such Option Shares, or, in
lieu thereof, to retain, or sell without notice, a sufficient number of shares
to cover the amount required to be withheld or in lieu of any of the foregoing,
to withhold a sufficient sum from the Optionee's compensation payable by the
Corporation to satisfy the Corporation's tax withholding requirements. The
Corporation's method of satisfying its withholding obligations shall be solely
in the discretion of the Corporation, subject to applicable federal, state and
local law.
10. Notices. All notices hereunder to the Corporation shall be delivered or
mailed to it addressed to the Secretary of the Corporation at 000-00xx Xxxxxx,
Xxxxxxxxxxxxx, Xxxxxxxx 00000. Any notices hereunder to the Optionee shall be
delivered personally or mailed to the Optionee's address noted below. Such
addresses for the service of notices may be changed at any time provided written
notice of the change is furnished in advance to the Corporation or the Optionee,
as the case may be.
11. Plan and Plan Interpretations as Controlling. This Option and the terms
and conditions herein set forth are subject in all respects to the terms and
conditions of the Plan, which are controlling. All determinations and
interpretations of the Committee shall be binding and conclusive upon the
Optionee or his legal representatives with regard to any question arising
hereunder or under the Plan.
12. Optionee Service. Nothing in this Option shall limit the rights of the
Corporation or any of its Affiliates to terminate the Optionee's service as a
director, advisory director, director emeritus, officer or employee, or
otherwise impose upon the Corporation or any of its Affiliates any obligation to
employ or accept the services of the Optionee.
13. Optionee Acceptance. The Optionee shall signify his acceptance of the
terms and conditions of this Option by signing in the space provided below and
returning a signed copy hereof to the Corporation at the address set forth in
Section 10 above. In signing this Agreement, the Optionee acknowledges that the
Option Shares may not be sold or otherwise transferred by the Optionee for at
least six months from the Grant Date without creating an obligation under
Section 16 of the Securities Act of 1934, as amended, to pay to the Corporation
any profit on any such transaction.
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IN WITNESS WHEREOF, the parties hereto have caused this NON-QUALIFIED STOCK
OPTION AGREEMENT to be executed as of the date first above written.
FIRST XXXXXXXX FINANCIAL CORPORATION
By: ____________________________________
Xxxx X. Xxxx, Director, President
and Chief Executive Officer
ACCEPTED:
____________________________________
____________________________________
(Street Address)
____________________________________
(City, State and Zip Code)
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FIRST XXXXXXXX FINANCIAL CORPORATION
1998 STOCK OPTION AND INCENTIVE PLAN
INCENTIVE STOCK OPTION AGREEMENT
ISO NO.
This option is granted on July 29, 1998 (the "Grant Date") by First
Xxxxxxxx Financial Corporation (the "Corporation") to______________ (the
"Optionee"), in accordance with the following terms and conditions:
1. Option Grant and Exercise Period. The Corporation hereby grants to the
Optionee an Option (the "Option") to purchase, pursuant to the Corporation's
1998 Stock Option and Incentive Plan, as the same may be from time to time
amended (the "Plan"), and upon the terms and conditions therein and hereinafter
set forth, an aggregate of______ shares (the "Option Shares") of the Common
Stock, par value $.01 per share ("Common Stock"), of the Corporation at the
price (the "Exercise Price") of $______ per share. A copy of the Plan as
currently in effect is incorporated herein by reference and is attached hereto.
This Option shall be exercisable only during the period (the "Exercise
Period") commencing on July 29, 1998 and ending at 5:00 p.m., Xxxxxxxx, Illinois
time, on the date ten years after the Grant Date, such later time and date being
hereinafter referred to as the "Expiration Date," provided the Optionee has
maintained "Continuous Service" (as defined in the Plan) since the Grant Date.
This Option shall vest and become exercisable according to the following
schedule:
% of the
Date of Vesting Options Vested
--------------- --------------
July 29, 1998 20%
July 29, 1999 20%
July 29, 2000 20%
July 29, 2001 20%
July 29, 2002 20%
During the Exercise Period, only the vested portion of this Option shall be
exercisable in whole at any time or in part from time to time subject to the
provisions of this Agreement, and further subject to the condition that the
aggregate Market Value (as defined in the Plan and as determined as of the Grant
Date) of the Option Shares with respect to which Incentive Stock Options (as
defined in the Plan) are exercisable for the first time by the Optionee in any
calendar year shall not exceed One Hundred Thousand Dollars ($100,000.00). The
Market Value of an Option Share on the date of grant of this Option is $_______.
To the extent that this Option does not qualify as an Incentive Stock Option for
any reason, it shall become a Non-Qualified Stock Option under the Plan.
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2. Method of Exercise of This Option. This Option may be exercised during
the Exercise Period by giving written notice to the Corporation specifying the
number of Option Shares to be purchased. The notice must be in the form
prescribed by the committee of the Plan or its successor (the "Committee") and
directed to the address set forth in Section 11 below. The date of exercise is
the date on which such notice is received by the Corporation. Such notice must
be accompanied by payment in full of the Exercise Price for the Option Shares to
be purchased upon such exercise. Payment shall be made either (i) in cash, which
may be in the form of a check, bank draft, or money order payable to the
Corporation, or, if permitted by the Committee (ii) if the Committee shall have
approved such form of payment, by delivering shares of Common Stock already
owned by the Optionee having a Market Value (as defined in the Plan) equal to
the Exercise Price for the number of Option Shares to be purchased, or (iii) if
the Committee shall have approved such form of payment, a combination of cash
and such shares. Promptly after such payment, subject to Section 3 below, the
Corporation shall issue and deliver to the Optionee or other person exercising
this Option a certificate or certificates representing the shares of Common
Stock so purchased, registered in the name of the Optionee (or such other
person), or, upon request, in the name of the Optionee (or such other person)
and in the name of another jointly with right of survivorship.
3. Delivery and Registration of Shares of Common Stock. The Corporation's
obligation to deliver shares of Common Stock hereunder shall be conditioned upon
the receipt of a representation as to the investment intention of the Optionee
or any other person to whom such shares are to be delivered, in such form as the
Committee shall determine to be necessary or advisable to comply with the
provisions of the Securities Act of 1933, as amended, or any other federal,
state or local securities law or regulation. In requesting any such
representation, it may be provided that such representation shall become
inoperative upon a registration of such shares or other action eliminating the
necessity of such representation under such Securities Act or other securities
law or regulation. The Corporation shall not be required to deliver any shares
upon exercise of this Option prior to (i) the admission of such shares to
listing on any stock exchange or system on which the shares of Common Stock may
then be listed, and (ii) the completion of such registration or other
qualification of such shares under any state or federal law, rule or regulation,
as the Committee shall determine to be necessary or advisable.
4. Non-Transferability of This Option. This Option may not be assigned,
encumbered, or transferred except by will or the laws of descent and
distribution to the extent provided in Section 5 below. Except as provided
herein, this Option is exercisable during the Optionee's lifetime only by the
Optionee. The provisions of this Option shall be binding upon, inure to the
benefit of and be enforceable by the parties hereto, the successors and assigns
of the Corporation and any person to whom this Option is transferred by will or
by the laws of descent and distribution.
5. Termination of Service or Death of the Optionee. Except as provided in
the second or third paragraphs of this Section 5 and notwithstanding any other
provision of this Option to the contrary, this Option shall not be exercisable
unless the Optionee, at the time of exercise of this Option, has maintained
"Continuous Service" (as defined in the Plan) since the Grant Date.
If the Optionee shall cease to maintain Continuous Service for any reason
(excluding termination of employment or removal from service as director,
advisory director or director emeritus by the Corporation or any Affiliate for
cause), the Optionee may, but only within the period of three years immediately
succeeding such cessation of Continuous Service and in no event after
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the Expiration Date, exercise this Option to the extent the Optionee was
entitled to exercise this Option at the date of cessation. If the Continuous
Service of the Optionee is terminated by the Corporation or an Affiliate for
cause, all rights under this Option shall expire immediately upon the giving to
the Optionee of notice of such termination.
In the event of the death of the Optionee while in Continuous Service of
the Corporation or during the three-year period referred to in the immediately
preceding paragraph, the person to whom the Option has been transferred by will
or by the laws of descent and distribution may, but only to the extent the
Optionee was entitled to exercise this Option upon his death, exercise this
Option at any time within one year following the death of the Optionee, but in
no event later than the Expiration Date. Following the death of the Optionee,
the Committee may, as an alternative means of settlement of this Option, elect
to pay to the person to whom this Option is transferred by will or by the laws
of descent and distribution the amount by which the Market Value (as defined in
the Plan) per share of Common Stock on the date of exercise of this Option shall
exceed the Exercise Price per Option Share, multiplied by the number of Option
Shares with respect to which this Option is properly exercised. Any such
settlement of this Option shall be considered an exercise of this Option for all
purposes of this Option and of the Plan. If the Optionee shall cease to maintain
Continuous Service due to death or disability, this Option shall become
exercisable in full upon the happening of such event and remain exercisable (i)
in the event of death for the one-year period described above or (ii) in the
event of disability or retirement for the three-year period immediately
following such person's termination of service, but in no event shall this
Option be exercisable later than the Expiration Date.
6. Notice of Sale. The Optionee or any person to whom the Option or the
Option Shares shall have been transferred by will or by the laws of descent and
distribution promptly shall give notice to the Corporation in the event of the
sale or other disposition of Option Shares within the later of (i) two years
from the Grant Date or (ii) one year from the date of exercise of this Option.
Such notice shall specify the number of Option Shares sold or otherwise disposed
of and be directed to the address set forth in Section 11 below.
7. Adjustments for Changes in Capitalization of the Corporation. In the
event of any change in the outstanding shares of Common Stock by reason of any
reorganization, recapitalization, stock split, stock dividend, combination or
exchange of shares, merger, consolidation, or any change in the corporate
structure of the Corporation or in the shares of Common Stock, the number and
class of shares covered by this Option and the Exercise Price shall be
appropriately adjusted by the Committee, whose determination shall be
conclusive.
8. Effect of Merger. In the event of any merger, consolidation or
combination of the Corporation (other than a merger, consolidation, or
combination in which the Corporation is the continuing entity and which does not
result in the outstanding shares of Common Stock being converted into or
exchanged for different securities, cash or other property, or any combination
thereof) pursuant to a plan or agreement the terms of which are binding upon all
stockholders of the Corporation (except to the extent that dissenting
stockholders may be entitled, under statutory provisions or provisions contained
in the certificate of incorporation, to receive the appraised or fair value of
their holdings), the Optionee shall, provided the Option has been granted at
least six months prior to such event, have the right (subject to the provisions
of the Plan and the limitations contained herein), thereafter and during the
Exercise Period, to receive upon exercise of this Option an amount
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equal to the excess of the fair market value on the date of such exercise of the
securities, cash or other property, or combination thereof, receivable upon such
merger, consolidation or combination in respect of a share of Common Stock over
the Exercise Price, multiplied by the number of Option Shares with respect to
which this Option shall have been exercised. Such amount may be payable fully in
cash, fully in one or more of the kind or kinds of property payable in such
merger, consolidation or combination, or partly in cash and partly in one or
more of such kind or kinds of property, all in the discretion of the Committee.
9. Stockholder Rights Not Granted by This Option. The Optionee is not
entitled by virtue hereof to any rights of a stockholder of the Corporation or
to notice of meetings of stockholders or to notice of any other proceedings of
the Corporation.
10. Withholding Tax. Upon the exercise of this Option, the Corporation
shall have the right to require the Optionee or such other person as is entitled
to exercise this Option to pay to the Corporation the amount of any taxes which
the Corporation or any of its Affiliates is required to withhold with respect to
such Option Shares, or, in lieu thereof, to retain, or sell without notice, a
sufficient number of such shares to cover the amount required to be withheld or
in lieu of any of the foregoing, to withhold a sufficient sum from the
Optionee's compensation payable by the Corporation to satisfy the Corporation's
tax withholding requirements. The Corporation's method of satisfying its
withholding obligations shall be solely in the discretion of the Corporation,
subject to applicable federal, state and local law.
11. Notices. All notices hereunder to the Corporation shall be delivered or
mailed to it addressed to the Secretary of the Corporation at 000-00xx Xxxxxx,
Xxxxxxxxxxxxx, Xxxxxxxx 00000. Any notices hereunder to the Optionee shall be
delivered personally or mailed to the Optionee's address noted below. Such
addresses for the service of notices may be changed at any time provided written
notice of the change is furnished in advance to the Corporation or to the
Optionee, as the case may be.
12. Plan and Plan Interpretations as Controlling. This Option and the terms
and conditions herein set forth are subject in all respects to the terms and
conditions of the Plan, which are controlling. All determinations and
interpretations of the Committee shall be binding and conclusive upon the
Optionee or his legal representatives with regard to any question arising
hereunder or under the Plan.
13. Optionee Service. Nothing in this Option shall limit the right of the
Corporation or any of its Affiliates to terminate the Optionee's service as a
director, advisory director, director emeritus, officer or employee, or
otherwise impose upon the Corporation or any of its Affiliates any obligation to
employ or accept the services of the Optionee.
14. Optionee Acceptance. The Optionee shall signify his acceptance of the
terms and conditions of this Option by signing in the space provided below and
returning a signed copy hereof to the Corporation at the address set forth in
Section 11 above. In signing this Agreement, the Optionee acknowledges that the
Option Shares may not be sold or otherwise transferred by the Optionee for at
least six months from the Grant Date without creating an obligation under
Section 16 of the Securities Act of 1934, as amended, to pay to the Corporation
the profit on any such transaction.
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IN WITNESS WHEREOF, the parties hereto have caused this INCENTIVE STOCK
OPTION AGREEMENT to be executed as of the date first above written.
FIRST XXXXXXXX FINANCIAL CORPORATION
By:________________________________
ACCEPTED:
____________________________________
____________________________________
(Street Address)
____________________________________
(City, State and Zip Code)
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