STOCK OPTION AGREEMENT
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FOR INCENTIVE STOCK OPTIONS UNDER SECTION 422
OF THE INTERNAL REVENUE CODE
PURSUANT TO THE
SUN BANCORP, INC.
2004 STOCK-BASED INCENTIVE PLAN
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FOR OFFICERS AND EMPLOYEES
STOCK OPTIONS for a total of _______ shares of Common Stock of Sun
Bancorp, Inc. (the "Company"), which Option is intended to qualify as an
Incentive Stock Option under Section 422 of the Internal Revenue Code of 1986,
as amended, is hereby granted to ______________, (the "Optionee"), at the price
determined as provided in, and in all respects subject to the terms, definitions
and provisions of the 2004 Stock-Based Incentive Plan (the "Plan") adopted by
the Company which is incorporated by reference herein, receipt of which is
hereby acknowledged.
1. Option Price. The Option price is $______ for each Share, being 100%
of the fair market value, as determined by the Committee, of the Common Stock on
the date of grant of this Option.
2. Exercises of Option. This Option shall be exercisable in accordance
with provisions of the Plan, provided the holder of such Option is an employee,
director or director emeritus of the Company as of such date, as follows:
(a) Schedule of Rights to Exercise.
Percentage of
Total Shares
Awarded Which
Are Exercisable/
Date Options Non-forfeitable
---- ------- ---------------
Upon grant................................ ___ 20%
As of ________________.................... ___ 40%
As of ________________.................... ___ 60%
As of ________________.................... ___ 80%
As of ________________.................... ___ 100%
A. Such Options awarded to the Optionee are intended to satisfy the requirements
of "incentive stock options" ("ISOs") within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended.
B. Options awarded to the Optionee shall continue to vest annually during such
period that he serves as an employee, director or advisory director of Sun
National Bank (the "Bank") or the Company.
C. Notwithstanding anything herein to the contrary, in no event shall any
Options granted herein be exercisable for a period of six months from the Date
of Grant, except in the event of the death or Disability of the Optionee or a
Change in Control of the Company. Upon such occurrences, all such Options shall
be immediately 100% vested and exercisable.
D. Upon termination of service for any reason, other than Disability or death,
such Options shall cease to be exercisable three months from the date of
termination of employment.
E. Upon Disability, all Options shall be deemed immediately exercisable for the
remaining term of such option.
F. Upon death, all Options shall be immediately exercisable by the estate for
two years from the date of death, not to exceed initial option term.
(b) Method of Exercise. This Option shall be exercisable by a
written notice which shall:
(i) State the election to exercise the Option, the
number of Shares with respect to which it is being exercised, the
person in whose name the stock certificate or certificates for such
Shares of Common Stock is to be registered, his address and Social
Security Number (or if more than one, the names, addresses and Social
Security Numbers of such persons);
(ii) Contain such representations and agreements as
to the holder's investment intent with respect to such shares of Common
Stock as may be satisfactory to the Company's counsel;
(iii) Be signed by the person or persons entitled to
exercise the Option and, if the Option is being exercised by any person
or persons other than the Optionee, be accompanied by proof,
satisfactory to counsel for the Company, of the right of such person or
persons to exercise the Option; and
(iv) Be in writing and delivered in person or by
certified mail to the Treasurer of the Company.
Payment of the purchase price of any Shares with respect to which the
Option is being exercised shall be by shares of Company Common Stock, certified
or bank cashier's or teller's check. The certificate or certificates for shares
of Common Stock as to which the Option shall be exercised shall be registered in
the name of the person or persons exercising the Option.
2
(c) Restrictions on Exercise. This Option may not be exercised
if the issuance of the Shares upon such exercise would constitute a violation of
any applicable federal or state securities or other law or valid regulation. As
a condition to the Optionee's exercise of this Option, the Company may require
the person exercising this Option to make any representation and warranty to the
Company as may be required by any applicable law or regulation.
3. Non-transferability of Option. This Option may not be transferred in
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any manner otherwise than by will or the laws of descent or distribution and may
be exercised during the lifetime of the Optionee only by the Optionee. The terms
of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
4. Term of Option. This Option may not be exercised more than ten (10)
--------------
years from the date of grant of this Option, as set forth below, and may be
exercised during such term only in accordance with the Plan and the terms of
this Option.
5. Related Matters. Notwithstanding anything herein to the contrary,
----------------
additional conditions or restrictions related to such Options may be contained
in the Plan or the resolutions of the Plan Committee authorizing such grant of
Options.
Sun Bancorp, Inc.
Date of Grant: ___________________ By: __________________________
Attest:
_________________________
[SEAL]
3
INCENTIVE STOCK OPTION EXERCISE FORM
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PURSUANT TO THE
SUN BANCORP, INC.
2004 STOCK-BASED INCENTIVE PLAN
-------------------------------
____________________
(Date)
Sun Bancorp, Inc.
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Dear Sir:
The undersigned elects to exercise the Incentive Stock Option to
purchase __________ shares of Common Stock of Sun Bancorp, Inc. under and
pursuant to a Stock Option Agreement dated ________________.
Delivered herewith is a certified or bank cashier's or teller's check
and/or shares of Common Stock, valued at the fair market value of the stock on
the date of exercise, as set forth below.
$__________ of cash or check
__________ of Common Stock
$ Total
==========
The name or names to be on the stock certificate or certificates and
the address and Social Security Number of such person(s) is as follows:
Name __________________________________________
Address _________________________________________
Social Security Number __________________________
Very truly yours,
___________________________
STOCK OPTION AGREEMENT
FOR NON-INCENTIVE STOCK OPTIONS
PURSUANT TO THE
SUN BANCORP, INC.
2004 STOCK-BASED INCENTIVE PLAN
-------------------------------
NON-EMPLOYEE DIRECTORS
STOCK OPTIONS for a total of __________ shares of Common Stock of Sun
Bancorp, Inc. (the "Company") is hereby granted to ______________________ (the
"Optionee") at the price determined as provided in, and in all respects subject
to the terms, definitions and provisions of the 2004 Stock-Based Incentive Plan
(the "Plan") adopted by the Company which is incorporated by reference herein,
receipt of which is hereby acknowledged. Such Stock Options do not comply with
Options granted under Section 422 of the Internal Revenue Code of 1986, as
amended.
1. Option Price. The Option price is $_____ for each Share, being 100%
------------
of the fair market value, as determined by the Committee, of the Common Stock on
the date of grant of this Option.
2. Exercise of Option. This Option shall be exercisable in accordance
------------------
with provisions of the Plan as follows:
(a) Schedule of Rights to Exercise.
Percentage of Total Shares
Awarded Which Are
Date Options Non-forfeitable
---- ------- ---------------
Upon grant....................... ___ 20%
As of ________________........... ___ 40%
As of ________________........... ___ 60%
As of ________________........... ___ 80%
As of ________________........... ___ 100%
A. Notwithstanding anything herein to the contrary, in no event shall any
Options granted herein be exercisable for a period of six months from the Date
of Grant, except in the event of the death or Disability of the Optionee or a
Change in Control of the Company. Upon such occurrences, all such Options shall
be immediately 100% vested and exercisable.
B. Upon death, all Options shall be immediately exercisable by the estate for
the remaining term of such Options.
C. All Options shall be exercisable for a period of ten years from the Date of
Grant without regard to continued service of the Optionee as a director or
advisory director.
(b) Method of Exercise. This Option shall be exercisable by a
written notice which shall:
(i) State the election to exercise the Option, the
number of Shares with respect to which it is being exercised, the
person in whose name the stock certificate or certificates for such
Shares of Common Stock is to be registered, his address and Social
Security Number (or if more than one, the names, addresses and Social
Security Numbers of such persons);
(ii) Contain such representations and agreements as
to the holder's investment intent with respect to such shares of Common
Stock as may be satisfactory to the Company's counsel;
(iii) Be signed by the person or persons entitled to
exercise the Option and, if the Option is being exercised by any person
or persons other than the Optionee, be accompanied by proof,
satisfactory to counsel for the Company, of the right of such person or
persons to exercise the Option; and
(iv) Be in writing and delivered in person or by
certified mail to the Treasurer of the Company.
Payment of the purchase price of any Shares with respect to which the
Option is being exercised shall be by shares of Company Common Stock, certified
or bank cashier's or teller's check. The certificate or certificates for shares
of Common Stock as to which the Option shall be exercised shall be registered in
the name of the person or persons exercising the Option.
(c) Restrictions on Exercise. This Option may not be exercised
------------------------
if the issuance of the Shares upon such exercise would constitute a violation of
any applicable federal or state securities or other law or valid regulation. As
a condition to the Optionee's exercise of this Option, the Company may require
the person exercising this Option to make any representation and warranty to the
Company as may be required by any applicable law or regulation.
3. Non-transferability of Option. This Option may not be transferred in
-----------------------------
any manner otherwise than by will or the laws of descent or distribution and may
be exercised during the lifetime of the Optionee only by the Optionee. The terms
of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
2
4. Term of Option. This Option may not be exercised more than ten (10)
--------------
years from the date of grant of this Option, as set forth below, and may be
exercised during such term only in accordance with the Plan and the terms of
this Option.
5. Related Matters. Notwithstanding anything herein to the contrary,
----------------
additional conditions or restrictions related to such Options may be contained
in the Plan or the resolutions of the Plan Committee authorizing such grant of
Options.
Sun Bancorp, Inc.
Date of Grant: ___________________ By: __________________________
Attest:
__________________________
[SEAL]
3
NON-INCENTIVE STOCK OPTION EXERCISE FORM
----------------------------------------
PURSUANT TO THE
SUN BANCORP, INC.
2004 STOCK-BASED INCENTIVE PLAN
-------------------------------
_______________________
(Date)
Sun Bancorp, Inc.
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Dear Sir:
The undersigned elects to exercise the Non-Incentive Stock Option to
purchase _________ shares of Common Stock of Sun Bancorp, Inc. under and
pursuant to a Stock Option Agreement dated ________________.
Delivered herewith is a certified or bank cashier's or teller's check
and/or shares of Common Stock, valued at the fair market value of the stock on
the date of exercise, as set forth below.
$__________ of cash or check
__________ of Common Stock
$ Total
==========
The name or names to be on the stock certificate or certificates and
the address and Social Security Number of such person(s) is as follows:
Name __________________________________________
Address _________________________________________
Social Security Number __________________________
Very truly yours,
___________________________
