NORTH ARKANSAS BANCSHARES, INC.
1998 STOCK OPTION AND INCENTIVE PLAN
_____________________________________
Agreement for Incentive Stock Options
_____________________________________
STOCK OPTION (the "Option") for a total of shares of Common
Stock, par value $.01 per share, of North Arkansas Bancshares,
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 (the "Code"), is hereby granted to (the
"Optionee") at the price set forth herein, and in all respects
subject to the terms, definitions and provisions of the North
Arkansas Bancshares, Inc. 1998 Stock Option and Incentive Plan
(the "Plan") which was adopted by the Company and which is
incorporated by reference herein, receipt of which is hereby
acknowledged.
1. Exercise Price. The exercise price per share is $
, which equals 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 the Plan and the following
provisions:
(i) Schedule of rights to exercise.
------------------------------
Percentage of Total Shares
Years of Continuous Employment Subject to Option Which May
After Date of Grant of Option Be Exercised
- ----------------------------- ----------------------------
Upon Grant _____%
1 year but less than 2 years _____%
2 years but less than 3 years _____%
3 years but less than 4 years _____%
4 years but less than 5 years _____%
5 years or more _____%
_______________
*/ 110% in the case of an Optionee who owns shares representing
more than 10% of the outstanding common stock of the Company
on the date of grant of this Option.
ISO Agreement
Page 2
(ii) Method of Exercise. This Option shall be exercisable
by a written notice by the Optionee which shall:
(a) 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);
(b) 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;
(c) 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
(d) 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 cash, Common
Stock, or such combination of cash and Common Stock as the
Optionee elects. In addition, the Optionee may elect to pay for
all or part of the exercise price of the shares by having the
Company withhold a number of shares having a fair market value
equal to the exercise price. 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.
(iii) 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. Withholding. The Optionee hereby agrees that the
exercise of the Option or any installment thereof will not be
effective, and no shares will become transferable to the
Optionee, until the Optionee makes appropriate arrangements with
the Company for such tax withholding as may be required of the
Company under federal, state, or local law on account of such
exercise.
ISO Agreement
Page 3
4. Non-transferability of Option. This Option may not
be transferred in any manner otherwise than by will or the laws
of descent or distribution. The terms of this Option shall be
binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.
5. Term of Option. This Option may not be exercisable
for more than ten years from the date of grant of this
Option, as stated below, and may be exercised during such term
only in accordance with the Plan and the terms of this Option.
_________________
Date of Grant NORTH ARKANSAS BANCSHARES, INC.
1998 STOCK OPTION AND
INCENTIVE PLAN COMMITTEE
By: ___________________________________
Authorized Member of the Committee
Witness: ______________________________
____________
**/ Five years in the case of an Optionee who owns shares
representing more than 10% of the outstanding common
stock of the Company on the date of grant of this Option.
NORTH ARKANSAS BANCSHARES, INC.
1998 STOCK OPTION AND INCENTIVE PLAN
____________________________________
Form for Exercise of
Incentive Stock Options
_____________________________________
Treasurer
North Arkansas Bancshares, Inc.
200 Olivia Drive
Newport, Arkansas 72112
Re: North Arkansas Bancshares, Inc. 1998 Stock Option
and Incentive Plan
-------------------------------------------------
Dear Sir:
The undersigned elects to exercise the Incentive Stock
Option to purchase ____________ shares, par value $.01, of
Common Stock of North Arkansas Bancshares, Inc. under and
pursuant to a Stock Option Agreement dated ______________,
199_.
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
$______ in the form of _______ shares of Common
Stock, valued at $____ per share
$______ in the form of the Company's
withholding of _______ shares of Common
Stock, valued at $ ____ per share,
that are subject to this Option
$ 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__________________________________________
_____________
Date
Very truly yours,
__________________________