Exhibit 10.1
NORTH COUNTRY FINANCIAL CORPORATION
2000 STOCK INCENTIVE PLAN
1. Objectives. The North Country Financial
Corporation 2000 Stock Incentive Plan is designed to
attract and retain certain selected key employees and
non-employee directors whose skills and talents are
important to the Company's operations, and reward them
for making major contributions to the success of the
Company. These objectives are accomplished by making
awards under the Plan, thereby providing Participants
with a proprietary interest in the growth and
performance of the Company.
2. Definitions.
(a) "Award" shall mean the grant of a Stock
Option to a Participant pursuant to such terms,
conditions, performance requirements, and
limitations as the Committee may establish in
order to fulfill the objectives of the Plan.
(b) "Award Agreement" shall mean an
agreement between North Country Financial
Corporation and a Participant that sets forth the
terms, conditions, performance requirements, and
limitations applicable to an Award.
(c) "Board" shall mean the Board of
Directors of North Country Financial Corporation.
(d) "Cause" shall mean termination of a
Participant's employment with the Company for (i)
any failure of the Participant to substantially
perform his duties with the Company (other than by
reason of illness) which occurs after the Company
has delivered to the Participant a demand
for performance which specifically identifies the
manner in which the Company believes the
Participant has failed to perform his duties, and
the Participant fails to resume performance of his
duties on a continuous basis within 14 days after
receiving such demand, (ii) the commission by the
Participant of any act of dishonesty or disloyalty
involving the Company or its business, or (iii)
the conviction of the Participant of a felony or
misdemeanor which, in the reasonable judgment of
the Committee, is substantially related to the
employee's position with the Company or
substantially impairs the Participant's ability to
perform his duties with the Company.
(e) "Change in Control" shall mean any of
the following:
(i) The acquisition by any individual,
entity or "group" (within the meaning of
Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended
(the "Exchange Act")) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of thirty-three
percent (33%) or more of either (A) the then
outstanding shares of common stock of the
Company (the "Outstanding Company Common
Stock") or (B) the combined
voting power of the then outstanding voting
securities of the Company entitled to vote
generally in the election of directors (the
"Outstanding Company Voting Securities"); provided,
however, that the following acquisitions of
common stock shall not constitute a Change in
Control: (A) any acquisition directly from
the Company (excluding an acquisition by
virtue of the exercise of a conversion
privilege or by one person or a group of
persons acting in concert), (B) any
acquisition by the Company, (C) any
acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the
Company or any corporation controlled by the
Company or (D) any acquisition by any
corporation pursuant to a reorganization,
merger, statutory share exchange or
consolidation which would not be a Change in
Control under paragraph (iii) of this Section
2(e); or
(ii) During any period of two
consecutive years, individuals who at the
beginning of such period constitute the
entire Board shall cease for any reason to
constitute a majority thereof unless the
election, or the nomination for election by
the Company's stockholders, of each new
director was approved by a vote of at least
two-thirds of the directors then still in
office who were directors at the beginning of
the period.
(iii) Consummation of a reorganization,
merger, statutory share exchange or
consolidation, unless, following such
reorganization, merger, statutory share
exchange or consolidation, (A) more than two
thirds (2/3) of, respectively, the then
outstanding shares of common stock of the
corporation resulting from such
reorganization, merger, statutory share
exchange or consolidation and the combined
voting power of the then outstanding voting
securities of such corporation entitled to
vote generally in the election of directors
is then beneficially owned, directly or
indirectly, by all or substantially all of
the individuals and entities who were the
beneficial owners, respectively, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities
immediately prior to such reorganization,
merger, statutory share exchange or
consolidation in substantially the same
proportions as their ownership, immediately
prior to such reorganization, merger,
statutory share exchange or consolidation,
(B) no person (excluding the Company, any
employee benefit plan (or related trust) of
the Company or such corporation resulting
from such reorganization, merger, statutory
share exchange or consolidation and any
person beneficially owning, immediately prior
to such reorganization, merger, statutory
share exchange or consolidation, directly or
indirectly, thirty-three percent (33%) or
more of the Outstanding Company Common Stock
or Outstanding Voting Securities, as the case
may be) beneficially owns, directly or
indirectly, thirty-three percent (33%) or
more of, respectively, the then outstanding
shares of common stock of the corporation
resulting from such reorganization, merger,
statutory share exchange or consolidation or
the combined voting power of the then
outstanding voting securities of such
corporation, entitled to vote generally in
the election of directors and (C) at least a
majority of the members of the Board of the
corporation resulting from such reorganization,
merger, statutory share exchange or consolidation
were members of the Board at the time of the
execution of the initial agreement providing for such
reorganization, merger or consolidation; or
(iv) Consummation of (A) a complete
liquidation or dissolution of the Company or
(B) the sale or other disposition of all or
substantially all of the assets of the
Company, other than to a corporation, with
respect to which following such sale or other
disposition, (1) more than two thirds (2/3)
of, respectively, the then outstanding shares
of common stock of such corporation and the
combined voting power of the then outstanding
voting securities of such corporation
entitled to vote generally in the election of
directors is then beneficially owned,
directly or indirectly, by all or
substantially all of the individuals and
entities who were the beneficial owners,
respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting
Securities immediately prior to such sale or
other disposition in substantially the same
proportion as their ownership, immediately
prior to such sale or other disposition, of
the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the
case may be, (2) no person (excluding the
Company and any employee benefit plan (or
related trust) of the Company or such
corporation and any person beneficially
owning, immediately prior to such sale or
other disposition, directly or indirectly,
thirty-three percent (33%) or more of the
Outstanding Company Common Stock or
Outstanding Company Voting Securities, as the
case may be) beneficially owns, directly or
indirectly, thirty-three percent (33%) or
more of, respectively, the then outstanding
shares of common stock of such corporation or
the combined voting power of the then
outstanding voting securities of such
corporation entitled to vote generally in the
election of directors and (C) at least a
majority of the members of the board of
directors of such corporation were members of
the Board at the time of the execution of the
initial agreement or action of the Board
providing for such sale or other disposition
of assets of the Company.
(f) "Code" shall mean the Internal Revenue
Code of 1986, as amended from time to time.
(g) "Committee" shall mean the Compensation
Committee of the Board of Directors of North
Country Financial Corporation which shall be
comprised of at least two non-employee directors.
(h) "Common Stock" shall mean the authorized
and issued or unissued no par value common stock
of North Country Financial Corporation.
(i) "Company" shall mean North Country
Financial Corporation and/or a subsidiary
including subsidiaries of subsidiaries and
partnerships and other business ventures in which
North Country Financial Corporation has a
significant equity interest, as determined in the
sole discretion of the Committee.
(j) "Fair Market Value" shall mean the
closing sale price of the Common Stock on the
Nasdaq National Market as reported in the Midwest
Edition of the Wall Street Journal for the date in
question, provided that, if no sales of Common
Stock were made on said exchange on that date,
"Fair Market Value" shall mean the closing sale
price of Common Stock as reported for the most
recent preceding day on which sales of Common
Stock were made on such exchange, or, failing any
such sales, such other price as the Committee may
determine in conformity with pertinent law and
regulations of the Treasury Department.
(k) "Participant" shall mean a current or
prospective employee or non-employee director of
the Company to whom an Award has been made under
the Plan.
(l) "Plan" shall mean the North Country
Financial Corporation 2000 Stock Incentive Plan.
(m) "Retirement" shall mean, in the case of
an employee, termination of employment with the
Company at the earlier of (i) after attaining age
65 or (ii) after attaining age 55 with ten years
of service with the Company or any predecessor in
interest to the Company. In the case of a non-
employee director, "Retirement" shall mean
termination of service on the board of directors
of the Company after at least three years of
service on the Company's Board.
(n) "Stock Option" shall mean a grant of a
right to purchase a specified number of shares of
Common Stock, the purchase price of which shall be
not less than 100% of Fair Market Value on the
date of grant. A stock option may be in the form
of a nonqualified stock option or an incentive
stock option ("ISO"). A nonqualified stock option
is an option that does not meet the criteria of an
ISO. An ISO, in addition to being subject to
applicable terms, conditions and limitations
established by the Committee, complies with
Section 422 of the Code which, among other
limitations, provides that the aggregate Fair
Market Value (determined at the time the option is
granted) of Common Stock for which ISOs are
exercisable for the first time by a Participant
during any calendar year shall not exceed
$100,000; that ISOs shall be priced at not less
than 100% of the Fair Market Value on the date of
the grant (110% in the case of a Participant who
is a 10% shareholder of the Company within the
meaning of Section 422 of the Code); and that ISOs
shall be exercisable for a period of not more than
ten years (five years in the case of a Participant
who is a 10% shareholder of the Company).
3. Eligibility. Current and prospective
employees and non-employee directors who provide
services to the Company are eligible for an Award under
the Plan if they hold, or will hold, positions of
responsibility and if their performance, in the
judgment of the Committee or the management of the
Company (if such responsibility is delegated pursuant
to Section 6 hereof), can have a significant effect on
the success of the Company.
4. Common Stock Available for Awards. Subject to
adjustment as provided in Section 13 hereof, the number
of shares that may be issued under the Plan for Awards
during the term of
the Plan is 500,000 shares of Common
Stock, all of which may be in the form of incentive
stock options. Any shares subject to an Award which
are used in settlement of tax withholding obligations
shall be deemed not to have been issued for purposes of
determining the maximum number of shares available for
issuance under the Plan. Likewise, if any Stock Option
is exercised by tendering shares, either actually or by
attestation, to the Company as full or partial payment
for such exercise under this Plan, only the number of
shares issued net of the shares tendered shall be
deemed issued for purposes of determining the maximum
number of shares available for issuance under the Plan.
No individual shall be eligible to receive Awards
aggregating more than 50,000 shares of Common Stock
reserved under the Plan in any one calendar year,
subject to adjustment as provided in Section 13 hereof.
North Country Financial Corporation shall take whatever
actions are necessary to file required documents with
the U.S. Securities and Exchange Commission and any
other appropriate governmental authorities and stock
exchanges to make shares of Common Stock available for
issuance pursuant to Awards.
5. Administration. The Plan shall be
administered by the Committee, which shall have full
and exclusive power to interpret the Plan, to determine
which current and prospective employees and non-
employee directors are Participants, to grant waivers
of Award restrictions, to determine the provisions of
Award Agreements and to adopt such rules, regulations
and guidelines for carrying out the Plan as it may deem
necessary or proper.
6. Delegation of Authority. Except to the extent
prohibited by applicable law or the applicable rules of
a stock exchange, the Committee may delegate to the
chief executive officer and to other senior officers of
the Company its duties under the Plan pursuant to such
conditions or limitations as the Committee may
establish. Any such delegation may be revoked by the
Committee at any time.
7. Awards. The Committee shall set forth in the
related Award Agreement the terms, conditions,
performance requirements, and limitations applicable to
each Award including, but not limited to, vesting
requirements, conditions under which acceleration of
vesting will occur and achievement of specific business
objectives.
8. Stock Option Exercise. The price at which
shares of Common Stock may be purchased under a Stock
Option shall be paid in full at the time of the
exercise in cash or, if permitted by the Committee, by
means of tendering shares of Common Stock, which have
been held by the Participant for more than six months
and have not been used within the prior six-month
period to exercise an option, either directly or by
attestation, valued at Fair Market Value on the date of
exercise, or any combination thereof.
9. Tax Withholding. The Company shall have the
right to deduct applicable taxes from any Award payment
and withhold, at the time of delivery or vesting of
shares under the Plan, an appropriate number of shares
for payment of taxes required by law or to take such
other action as may be necessary in the opinion of the
Company to satisfy all obligations for withholding of
such taxes. The Company may defer making delivery with
respect to Common Stock obtained pursuant to an Award
hereunder until arrangements satisfactory to it have
been made with respect to any such withholding
obligation. If Common Stock is used to satisfy tax
withholding,
such stock shall be valued based on the Fair Market
Value when the tax withholding is required to be made.
10. Amendment or Termination of the Plan. The
Board may, at any time, amend or terminate the Plan;
provided, however, that
(a) subject to Section 13 hereof, no amendment
or termination may, in the absence of
written consent to the change by the
affected Participant (or, if the Participant
is not then living, the affected
beneficiary), adversely affect the rights of
any Participant or beneficiary under any
Award granted under the Plan prior to the
date such amendment is adopted by the Board;
and
(b) without further approval of the shareholders
of the Company, no amendment shall increase
the number of shares of Common Stock which
may be issued pursuant to Awards hereunder,
except for increases resulting from Section
13 hereof.
11. Termination of Employment. If the employment
of a Participant terminates, or a non-employee director
no longer serves on the Board, other than pursuant to
paragraphs (a) through (c) of this Section 12, all
unvested Awards shall immediately terminate and all
vested but unexercised, deferred or unpaid Awards shall
terminate 90 days after such termination of employment
or service, unless the Award Agreement provides
otherwise, and during such 90-day period shall be
exercisable only to the extent provided in the Award
Agreement. Notwithstanding the foregoing, if a
Participant's employment is terminated for Cause, to
the extent the Award is not effectively exercised or
has not vested prior to such termination, it shall
lapse or be forfeited to the Company immediately upon
termination. In all events, an Award will not be
exercisable after the end of its term as set forth in
the Award Agreement.
(a) Retirement. When a Participant's
employment or service terminates as a result of
Retirement, or early retirement with the consent
of the Committee, the Committee (in the form of an
Award Agreement or otherwise) may permit Awards to
continue in effect beyond the date of Retirement,
or early retirement, and/or the exercisability and
vesting of any Award may be accelerated.
(b) Resignation in the Best Interests of the
Company. When a Participant resigns from the
Company or the Board and, in the judgment of the
Committee, the acceleration and/or continuation of
outstanding Awards would be in the best interests
of the Company, the Committee may (i) authorize,
where appropriate, the acceleration and/or
continuation of all or any part of Awards granted
prior to such termination and (ii) permit the
exercise, vesting and payment of such Awards for
such period as may be set forth in the applicable
Award Agreement.
(c) Death or Disability of a Participant.
(i) In the event of a
Participant's death, the Participant's estate
or beneficiaries shall have a period
specified in the Award Agreement within which
to receive or exercise any outstanding Award
held by the Participant under such terms, and
to the extent, as may be specified in the
applicable Award Agreement. Rights to any
such outstanding Awards shall pass by will or
the laws of descent and distribution in the
following order: (a) to beneficiaries so
designated by the Participant; if none, then
(b) to a legal representative of the
Participant; if none, then (c) to the persons
entitled thereto as determined by a court of
competent jurisdiction. Subject to
subparagraph (iii) below, Awards so passing
shall be exercised or paid out at such times
and in such manner as if the Participant were
living.
(ii) In the event a Participant is
deemed by the Company to be disabled within
the meaning of the Company's group long-term
disability plan, or if the Company does not
have such a plan, Section 22(e)(3) of the
Code, the Award shall be exercisable for the
period, and to the extent, specified in the
Award Agreement. Awards and rights to any
such Awards may be paid to or exercised by
the Participant, if legally competent, or a
legally designated guardian or representative
if the Participant is legally incompetent by
virtue of such disability.
(iii) After the death or
disability of a Participant, the Committee
may in its sole discretion at any time (1)
terminate restrictions in Award Agreements
and (2) accelerate any or all installments
and rights.
(iv) In the event of uncertainty
as to interpretation of or controversies
concerning this paragraph (c) of Section 11,
the Committee's determinations shall be
binding and conclusive.
(d) No Employment Rights. The Plan shall
not confer upon any Participant any right with
respect to continuation of employment by the
Company or service on the Board, nor shall it
interfere in any way with the right of the Company
to terminate any Participant's employment or
service on the Board at any time.
12. Nonassignability. Except as provided in
subsection (c) of Section 11 and this Section 12, no
Award under the Plan shall be assignable or
transferable, or payable to or exercisable by anyone
other than the Participant to whom it was granted.
Notwithstanding the foregoing, the Committee (in the
form of an Award Agreement or otherwise) may permit
Awards, other than incentive stock options within the
meaning of Section 422 of the Code, to be transferred
to members of the Participant's immediate family, to
trusts for the benefit of the Participant and/or such
immediate family members, and to partnerships or other
entities in which the Participant and/or such immediate
family members own all the equity interests. For
purposes of the preceding sentence, "immediate family"
shall mean a Participant's spouse, issue, and spouses
of his issue.
13. Adjustments. In the event of any change in
the outstanding Common Stock of the Company by reason
of a stock split, stock dividend, combination or
reclassification of shares, recapitalization, merger,
or similar event, the Committee may adjust
proportionally (a) the number of shares of Common Stock
(i) reserved under the Plan, (ii) available for ISOs,
(iii) for which Awards may be granted to an individual
Participant, and (iv) covered by outstanding Awards
denominated in stock; (b) the stock prices related to
outstanding Awards; and (c) the appropriate Fair Market
Value and other price determinations for such Awards.
In the event of any other change affecting the Common
Stock or any distribution (other than normal cash
dividends) to holders of Common Stock, such adjustments
as may be deemed equitable by the Committee, including
adjustments to avoid fractional shares, shall be made
to give proper effect to such event. In the event of a
corporate merger, consolidation, acquisition of
property or stock, separation, reorganization or
liquidation, the Committee shall be authorized to issue
or assume Stock Options, whether or not in a
transaction to which Section 424(a) of the Code
applies, by means of substitution of new Stock Options
for previously issued Stock Options or an assumption of
previously issued Stock Options.
14. Notice. Any notice to the Company required
by any of the provisions of the Plan shall be addressed
to the president of the Company in writing, and shall
become effective when it is received by his office.
15. Governing Law. The Plan and all
determinations made and actions taken pursuant hereto
shall be governed by the laws of the State of Michigan,
without giving effect to principles of conflicts of
laws, and construed accordingly.
16. Effective and Termination Dates. The
effective date of the Plan is February 16, 2000. The
Plan shall terminate on February 15, 2010 subject to
earlier termination by the Board pursuant to Section
11, after which no Awards may be made under the Plan,
but any such termination shall not affect Awards then
outstanding or the authority of the Committee to
continue to administer the Plan.
17. Other Benefit and Compensation Programs.
Payments and other benefits received by a Participant
pursuant to an Award shall not be deemed a part of such
Participant's regular, recurring compensation for
purposes of the termination, indemnity or severance pay
law of any country and shall not be included in, nor
have any effect on, the determination of benefits under
any other employee benefit plan, contract or similar
arrangement, unless the Committee expressly determines
otherwise.