Amended as of 4/22/2003
1ST SOURCE CORPORATION
1982 RESTRICTED STOCK AWARD PLAN
1. PURPOSE. This Restricted Stock Award Plan ("the Plan") is intended
to promote the interest of 1st Source Corporation, an Indiana corporation (the
"Corporation") and its shareholders by providing an incentive to induce
continued future employment and performance of certain key exempt or non-exempt
employees of the Corporation and certain key employees of one or more
Subsidiaries of Corporation. For the purposes of this Plan, the term
"Subsidiary" shall mean a corporation or corporations of which the Corporation
owns, directly or indirectly, a majority of the outstanding voting stock.
2. ADOPTION AND ADMINISTRATION OF THE PLAN. The Plan shall become
effective as of May 1, 1982. The Plan shall be administered by the Executive
Compensation Committee of the Corporation (the "Committee"). The Committee shall
interpret, implement, and administer the Plan to the extent and the manner
contemplated herein it shall exercise the discretion granted to it as to the
determination of who shall participate in the Plan, the terms and conditions
under which key employees may participate or continue participating in the Plan,
how many shares shall be allocated to each participant, and the time when such
shares shall be allocated and issued to each participant. Any action taken by
the Committee with respect to the implementation, interpretation or
administration of the Plan shall be final, conclusive and binding on the
Corporation and each participant.
3. STOCK SUBJECT TO PLAN. The Committee may allocate to the Restricted
Stock Award Plan not more than 1% in any one year of the outstanding common
stock of the Corporation outstanding at the beginning of such year, which common
stock is herein sometimes referred to as "shares." The distribution of shares
pursuant to this Plan may be made either from authorized and unissued shares or
from Treasury shares as determined by the Committee. All shares issued in
accordance with the Plan shall be fully paid and non-assessable shares and free
from preemptive rights.
4. ELIGIBILITY. The Committee shall designate from time to time key
exempt and non-exempt employees of the Corporation or a Subsidiary (including
officers) engaged in activities which further the objectives of the Corporation,
who shall be eligible to receive an allocation or allocations of shares under
the Plan as recommended by the Chief Executive Officer, and the number of shares
of stock of the Corporation to be allocated to each. In selecting those persons
to whom allocations of shares hereunder shall be made at any time, and in
determining the number of shares to be allocated, the Committee shall consider
with respect to those employees the position and responsibility of such persons,
the value of their future services to the Corporation, the compensation
otherwise received by persons and other factors as the Committee deems
pertinent.
5. FORM OF ALLOCATION. At the time of making any allocation by the
Committee, the Committee shall advise the employee selected to participate in a
stock award under this Plan as to such allocation by written notice, which
employee so selected hereinafter is sometimes referred to as "Participant."
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6. ACTION REQUIRED OF PARTICIPANTS.
(a) Within 30 days from the date of such written notice of the
Participant's initial allocation under the Plan, the Participant shall
notify the Committee, in writing, of acceptance of the allocation and
the terms thereof, applicable to the initial allocation and to all
subsequent allocations accepted under the Plan, which notice shall be
deemed delivered for all purposes by this Plan when personally
delivered or mailed to Chief Financial Officer, 1st Source
Corporation, P.O. Box 1602, South Bend, Indiana 46634 by postpaid
certified United States mail.
(b) The Corporation may require that, in allocating shares, the
Participant agree with, and represent to, the Corporation that
Participant is acquiring such shares for the purpose of investment and
with no present intention to transfer, sell or otherwise dispose of
such shares except such distribution by a legal representative as
shall be required by will or the laws of any jurisdiction in winding
up the estate of any Participant. Such shares shall be transferable
thereafter only if the proposed transfer shall be permissible pursuant
to this Plan and if, in the opinion of counsel (who shall be
satisfactory to Corporation), such transfer shall at such time be in
compliance with applicable securities laws.
7. RESTRICTIONS. By accepting the allocation of shares under this
Plan, a Participant agrees and consents to the following additional
restrictions:
(a) A certificate or certificates for the shares allocated to a
Participant shall be delivered by the Corporation to a Participant on
the date at which restrictions set forth in paragraph 7(c) below,
shall have lapsed. Until such time as the restrictions lapse,
Corporation shall issue and retain in safekeeping such allocation.
Upon issue Participant shall be a shareholder with respect to all of
the shares represented by such certificate or certificates and shall
have all rights of a shareholder with respect to all such shares,
including the right to vote such shares and receive all dividends and
other distributions, subject to termination upon the occurrence of an
Act of Forfeiture as set forth in this Plan. The certificates for such
shares may be either imprinted or stamped with a legend to the effect
that the shares represented thereby may not be sold, exchanged,
transferred, pledged, hypothecated, assigned, conveyed, or otherwise
voluntarily or involuntarily disposed of except in accordance with
this Plan (any such disposition being automatically an Act of
Forfeiture) by the holder thereof until such time as the restrictions
provided for herein lapse.
(b) If new or additional or different shares or securities are
distributed with respect to shares of common stock of the Corporation
as the result of a stock split, stock dividend, combination of shares
or other change involving 1st Source securities, or exchange for other
securities, or reclassification, reorganization, merger,
consolidation, recapitalization or otherwise ("Exchange Event"), the
Participant shall, as the owner of shares subject to restrictions
hereunder, be entitled to such new or additional or different shares
of stock or securities.
(1) In the case of an Exchange Event, the certificate or
certificates for, or other evidences of, such new or additional
or different shares or securities shall be appropriately
imprinted with the legend provided in paragraph 7(a) of this
Plan, and all provisions of this Plan relating to restrictions
and lapse of restrictions herein set forth shall thereupon be
applicable to such new or additional or different shares or
securities to the extent applicable to the shares with respect to
which they were distributed; provided, further, that if the
Participant shall receive rights, warrants or fractional
interests in respect of any of such shares, such rights or
warrants and such fractional interests shall be received by the
Participant subject to all of the remaining restrictions herein
set forth. All such additional shares, rights or other securities
shall be retained in safekeeping by the Corporation for the
account of the Participant.
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(2) In the case of a qualifying termination of employment of
the Participant, as defined below, (i) all awarded shares subject
to forfeiture under this Plan shall no longer be subject to
forfeiture and shall be earned stock for all purposes of the
Plan, and (ii) all restrictions on shares of stock theretofore
awarded hereunder shall terminate (except for any restrictions
imposed by applicable securities laws). The foregoing sentence
shall be effective immediately prior to such qualifying
termination of employment.
(3) For purposes of this Section, the following defined
terms have the described meanings. "Qualifying termination of
employment" means the involuntary termination of the
Participant's employment (i) within one year following an
Exchange Event that involves the distribution of securities of an
issuer other than 1st Source and that results in a change of
control of 1st Source and (ii) for reasons other than the
Participant's willful and continued failure to perform his or her
material duties and other than the Participant's dishonesty or
willful misconduct in connection with his or her work. "Change of
control" means a change of ownership or management that the
Committee, in its full and sole discretion, shall determine to be
a change of control for purposes of this Section; in the absence
of a contrary finding by the Committee, the acquisition by any
person or group of persons, other than 1st Source, of beneficial
ownership of 50.01% or more of the then outstanding shares of 1st
Source common stock shall be deemed a change of control.
(c) The term "Restricted Period" with respect to any allocation
of shares issued to a Participant under this Plan shall mean a period
commencing on the date of issuance of such shares to the Participant
and ending ten (10) years or such other period as the Committee may
designate in the notice of allocation thereafter. The restricted
period shall terminate at an equal and proportionate amount of the
allocation of shares for each year in which:
(1) the Participant has served continuously as an employee,
and was employed or retired at year end, or in which such
employee dies while employed or retired.
(2) the company return on equity meets or exceeds the rate
of return on common equity established in advance by the
Committee, or the Participant meets or exceeds the individual
performance goal(s) established in advance by the Committee, as
applicable.
Any year in which the cumulative rate of return on equity meets or exceeds
the rate established for the accumulated years subsequent to the year of the
award, will remove the restrictions for that year and any prior year for which
the yearly rate failed to meet the established rate.
Notwithstanding the foregoing, the Committee may in its sole discretion at
any time extend the Forfeiture Period on issued shares for the current or prior
year(s), despite the Corporation's failure to meet the required annual or
cumulative rate of return.
With respect to individual performance goals, if a Participant fails to
meet or exceed his/her individual performance goal(s) for a given year, all
shares so restricted with respect to that year will be forfeited.
The Committee may designate the particular shares with respect to which
such restrictions end at the expiration of each such yearly period either by
authorizing the issuance of separate certificates or by other instruments or
documentation as deemed feasible by the Committee, and such certificates shall
be delivered to Participant forthwith.
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(d) For all purposes of this Plan, an "Act of Forfeiture" with
respect to the remaining restricted stock of any award shall be deemed
to be any one of the following:
(1) Voluntary or involuntary termination including death,
retirement or total disability of the employment of a Participant
during the Restricted Period, or
(2) The attempted sale, exchange, transfer, pledge,
hypothecation, assignment, conveyance or other voluntary or
involuntary disposition of any of the restricted shares during
their Restricted Period, all of which is hereby expressly
prohibited by this agreement, or
(3) The election by the Participant to be taxed in the year
of receipt of the restricted stock under Section 83(b) of the
Internal Revenue Code of 1986 as amended, or
(4) Termination of the Restricted Period if the annual or
cumulative rate of return on common equity has not been achieved.
(e) Upon the occurrence of an Act of Forfeiture relating to a
Participant, the right, title and interest of all remaining restricted
shares of Corporation allocated to the Participant shall be
automatically forfeited and terminated for all purposes and
Participant agrees on behalf of himself, his personal representatives,
heirs, legatees, or successors to:
(1) Execute and deliver to Corporation such forms of stock
power, assignments or instruments of transfer which Corporation
may reasonably request and, upon the failure of Participant or
his personal representatives, heirs, legatees or successors so to
do, the Secretary of Corporation is hereby appointed as the
attorney-in-fact of Participant and his personal representatives,
heirs, legatees or successors to execute and deliver any and all
forms of stock power, assignments and instruments of transfer
requested by the Committee to vest and transfer to Corporation
complete title to all such forfeited shares, and further each
Participant consents and agrees that the St. Joseph Circuit Court
of St. Joseph County, Indiana, shall have personal jurisdiction
over such Participant to permit Corporation to obtain an order to
specific performance which is authorized and for which consent is
hereby given by each Participant who accepts an allocation of
shares under this Plan.
(f) The right, title and interest of any transferee of any
restricted shares acquired from a Participant under this Plan by Will
or by the laws of descent and distribution shall be subject to all the
terms and conditions of this Plan, including, but without limitation,
the restrictions on transfer and the provisions relating to
forfeiture.
(g) Any transfer or purported transfer made by a Participant at
any time while restricted or prohibited by this Plan, except at the
times and in the manner expressly authorized, shall be null and void
and the Corporation shall not be obligated to recognize or give effect
to such transfer on its books or records or recognize the person or
persons to whom such purported transfer has been made as the legal
beneficial holder of such shares.
(h) The Committee may impose such other restrictions on any
shares allocated to a Participant pursuant to this Plan as it may deem
advisable, including without limitation, restrictions under the
Securities Act of 1933, as amended, under the requirements of any
stock exchange upon which such shares or shares of the same class are
then listed, and under any blue-sky or securities laws applicable to
such shares.
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8. MISCELLANEOUS PROVISIONS.
(a) Expense. All expenses and costs in connection with the
administration of the Plan shall be borne by the Corporation.
(b) No Prior Rights of Offer. Nothing in the Plan shall be deemed
to give any officer or employee of the Corporation or his or its legal
representatives or assigns or any other person or entity claiming
under or through any Participant any contractual or other right to
participate in the benefits of the Plan.
(c) Indemnification of the Committee. In addition to such other
rights or indemnifications as they may have, the members of the
Committee shall be indemnified by the Corporation against all costs
and expenses reasonably incurred by them or any of them in connection
with any action, suit or proceeding to which they or any of them may
be a party by reason of any action taken or failure to act under or in
connection with the Plan or any award granted thereof and against all
amounts paid by them in settlement thereof (provided such settlement
is approved by legal counsel selected by the Corporation) or paid by
them in satisfaction of a judgment in any such action, suit or
proceedings, the person desiring indemnification shall give the
Corporation an opportunity, at its own expense, to handle and defend
the same.
(d) Liability of Corporation. The Liability of the Corporation
under this Plan or any allocation of shares made hereunder is limited
to the obligation set forth with respect to such allocation, and
nothing herein contained shall be construed to impose any liability on
the Corporation in favor of any Participant with respect to any loss,
cost or expense which a Participant may incur in connection with or
arising out of any transaction in connection therewith.
(e) No Agreement to Employ. Nothing in the Plan shall be
construed to constitute or be evidenced of an agreement or
understanding expressed or implied on the part of the Corporation or
any Subsidiary to employ or retain any Participant to whom any shares
have been allocated for any specified period of time or times.
9. AMENDMENT AND TERMINATION OF THE PLAN. The Corporation may at any time
terminate or extend the Plan, or make such modification of the Plan or of the
exhibits attached to this Plan as it shall deem advisable. No termination or
amendment of the Plan shall, without the consent of any person affected thereby,
modify or in any way affect any right or obligation created prior to such
termination or amendment.
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