COAST BANCORP
1995 AMENDED AND RESTATED STOCK OPTION PLAN
INDEX
ARTICLE DESCRIPTION COMMENCING
NO. ON PAGE
1. PURPOSE.............................................................. 1
2. ADMINISTRATION....................................................... 1
3. PARTICIPANTS......................................................... 3
4. THE SHARES........................................................... 4
5. GRANTS, TERMS AND CONDITIONS OF OPTIONS.............................. 4
6. ADJUSTMENT OF AND CHANGES IN THE SHARES.............................. 12
7. LISTING OR QUALIFICATION OF SHARES................................... 15
8. AMENDMENT AND TERMINATION OF THE PLAN................................ 15
9. BINDING EFFECT OF CONDITIONS......................................... 16
10. EFFECTIVENESS OF THE PLAN............................................ 17
11. PRIVILEGES OF STOCK OWNERSHIP; SECURITIES
LAW COMPLIANCE; NOTICE OF SALE....................................... 17
12. INDEMNIFICATION...................................................... 18
13. INFORMATION TO OPTIONEES............................................. 18
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COAST BANCORP
1995 AMENDED AND RESTATED
STOCK OPTION PLAN
___________ o0o ____________
1. PURPOSE
The purpose of this 1995 Amended and Restated Stock Option Plan (the
"Plan") of Coast Bancorp and its Affiliates (hereinafter collectively referred
to as the "Company"), is to secure for the Company and its stockholders the
benefits of the incentive inherent in the ownership of Common Stock of Coast
Bancorp by those key, full-time employees and officers of the Company who will
share responsibility with management of the Company for its future growth and
success. Options may also be granted to non-employee directors of the Company.
The word "Affiliate", as used in this Plan, means any corporation or bank
in an unbroken chain of banks or corporations beginning or ending with the
Company, if at anytime, each such bank or corporation other than the last in
that chain owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one or the other corporations
or banks in the chain.
2. ADMINISTRATION
The following provisions shall govern the administration of the Plan:
(a) The Plan shall be administered by a committee of the Board of
Directors duly appointed by the Board (the "Committee") composed of two (2)
or more directors, each of whom is a "Non-Employee Director" within the
meaning of Rule
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16b-3 under the Securities Exchange Act of 1934, as amended (the "1934 Act"), or
any successor rule or regulation, i.e. each Committee member is not employed by
the Company or its affiliates, does not receive compensation for services or
engage in any transaction or series of transactions in excess of $60,000 in any
year (excluding directors' fees) with the Company, or does not engage in a
business relationship which requires disclosure under Regulation S-K Section
404(b) pursuant to the 1934 Act. However, receiving a grant of an option under
the Plan or any other plan of the Company, or participation in a formula plan
meeting the conditions of Rule 16b-3 under the 1934 Act shall not disqualify a
director from being a "Non-Employee Director". The Board of Directors may from
time to time remove members from or add members to the Committee. Vacancies on
the Committee, however caused, shall be filled by the Board of Directors. The
Board of Directors shall designate a Chairman of the Committee from among the
Committee members. Acts of the Committee (i) at a meeting, held at a time and
place and in accordance with rules adopted by the Committee, at which a quorum
of the Committee is present and acting, or (ii) reduced to and approved in
writing by a majority of the members of the Committee, shall be the valid acts
of the Committee.
(b) The Company shall effect the grant of options under the Plan by
execution of instruments in writing in a form approved by the Committee.
Subject to the express terms and conditions of the Plan and the terms of any
option outstanding under the Plan, the Committee shall have full power to
construe the Plan and the terms of any option granted under the Plan, to
prescribe, amend and rescind rules
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and regulations relating to the Plan or such options and to make all other
determinations necessary or advisable for the Plan's administration, including,
without limitation, the power to (i) determine which persons meet the
requirements of Section 3 hereof for selection as participants in the Plan and
which persons are considered to be "employees" for purposes of the Internal
Revenue Code of 1986, as amended (the "Code"), and therefore eligible to receive
incentive stock options under the Plan; (ii) determine to whom of the eligible
persons, if any, options shall be granted under the Plan; (iii) establish the
terms and conditions required or permitted to be included in every option
agreement or any amendments thereto, including whether options to be granted
thereunder shall be "incentive stock options", as defined in the Code, or
"nonstatutory stock options"; (iv) specify the number of shares to be covered by
each option; (v) in the event a particular option is to be an incentive stock
option, determine and incorporate such terms and provisions, as well as
amendments thereto, as shall be required in the judgement of the Board of
Directors or the Committee, so as to provide for or conform such option to any
change in any law, regulation, ruling or interpretation applicable thereto; and
(vi) to make all other determinations deemed necessary or advisable for
administering the Plan. The Committee's determination on the foregoing matters
shall be conclusive.
3. PARTICIPANTS
Participants in the Plan shall be those, non-employee directors, officers
and key, full-time, salaried employees of the Company to whom options may be
granted from time to time by the Committee.
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4. THE SHARES
The shares of stock initially subject to options authorized to be granted
under the Plan shall consist of four hundred thousand (400,000) shares of Common
Stock (the "Shares") of the Company, or the number and kind of shares of stock
or other securities which shall be substituted for such shares or to which such
shares shall be adjusted as provided in Section 6. The Shares subject to the
Plan may be set aside out of the authorized but unissued shares of Common Stock
of the Company not reserved for any other purpose or out of shares of Common
Stock subject to an option which, for any reason, terminates unexercised as to
the Shares.
5. GRANTS, TERMS AND CONDITIONS OF OPTIONS
Options may be granted at any time prior to the termination of the Plan to
non-employee directors, officers and other key, full-time, salaried employees of
the Company who, in the judgment of the Committee, contribute to the successful
conduct of the Company's operation through their judgment, interest, ability and
special efforts; provided, however, that: (i) for incentive stock options, the
aggregate fair market value of the stock (determined as of the date the option
is granted) which is exercisable for the first time in any calendar year (under
all stock option plans of the Company, its Affiliates or any predecessor of any
such corporation) shall not exceed $100,000; (ii) except in the case of
termination by death or disability or cause or cessation of status as a
director, as set forth in Section 5(c) below, the granted option must be
exercised by an optionee no later than three (3) months and one (1) day after
any termination of employment or status as a director with the Company
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and said employment or status as a director must have been continuous since the
granting of the option. Further, incentive stock options may only be granted to
full-time, salaried employees of the Company.
In addition, options granted pursuant to the Plan shall be subject to the
following terms and conditions:
(a) NUMBER OF SHARES.
(i) Each agreement evidencing an option granted under the Plan shall
state the number of Shares subject to the option.
(ii) Each person who is a non-employee Director of the Company
("Director") on the date of adoption of the Plan by the Board of Directors of
the Company (the "Commencement Date") shall be entitled to a grant of an option
to purchase two thousand (2,000) Shares (an "Initial Grant"). On or after the
Commencement Date, options may be granted to Directors (the "Date of Grant"),
which grant shall become effective as of the day following approval of the Plan
by the Shareholders of the Company at the Company's 1995 Annual Meeting of
Shareholders and compliance with applicable securities laws; and which shall
thereafter vest as provided in Section 5(d) hereof.
(iii) On each anniversary date of the Date of Grant (the "Anniversary
Grant Date"), each Director who has been a Director continuously for the
preceding calendar year shall be entitled to a grant of an option to purchase an
additional two thousand (2,000) Shares (an "Annual Grant"). Notwithstanding the
foregoing, the
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maximum number of Shares for which options may be granted under the Plan to any
Director shall be ten thousand (10,000) Shares.
(iv) In the event a Director who is entitled to an Initial Grant or
Annual Grant on the Date of Grant or Anniversary Grant Date, respectively,
ceases to be a Director for any reason other than by reason of death of said
Director prior to the Date of Grant or Anniversary Grant Date, such Director
shall not be entitled to receive such Initial Grant or Annual Grant.
(v) In the event of the death, prior to the Date of Grant or
Anniversary Grant Date, of a Director who is entitled to an Initial Grant or
Annual Grant on the Date of Grant or Anniversary Grant Date, respectively, the
personal representative of said Director shall be entitled to receive the
Initial Grant or Annual Grant to which said Director was entitled on such Date
of Grant or Anniversary Grant Date, but shall not be entitled to receive any
further grants under the Plan.
(vi) No proration of an Annual Grant shall be made to any Director
based on a partial year of service as a Director.
(b) VESTING PERIOD OF OPTIONS. With respect to each option granted
pursuant to Section 5(a) above, each optionee shall agree to remain as a
director and to render his or her services for a period of at least six (6)
months from the respective Date of Grant or Anniversary Grant Date, but such
agreement shall not impose upon the Company any obligation to retain the
optionee as a director for any period. No option may be exercised by any
optionee unless and until the optionee has served continuously as a director,
officer or employee for a period of six (6) months from the
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date of grant of such option (the "Vesting Period"), except as set forth in
Sections 5(e) and 6 hereof. Upon the expiration of six (6) months from each
respective Date of Grant or Anniversary Grant Date, each option granted pursuant
to Section 5(a)(ii) thru (iv) shall become immediately exercisable in full.
(c) OPTION PRICE. The purchase price (the "Option Price") under each
option shall be not less than one hundred percent (100%) of the fair market
value of the Shares subject thereto on the date the option is granted, as such
value is determined by the Committee. The fair market value of such stock shall
be determined in accordance with any reasonable valuation method, including the
valuation methods described in Treasury Regulation Section 20.2031-2. If,
however, an employee owns stock of the Company possessing more than ten percent
(10%) of the total combined voting power of all classes of stock of the Company,
the option price of any incentive stock option granted to such optionee shall be
not less than one hundred ten percent (110%) of such fair market value at the
time such option is granted.
(d) DURATION AND EXERCISE OF OPTIONS. Each option shall vest in such
manner and at such time at the rate of at least 20% per year up to but not
exceeding five (5) years from the date the option is granted for all
Participants as the Committee shall determine in its sole discretion; provided,
further, that if an incentive stock option is granted to an employee owning
stock possessing more than ten percent (10%) of the total combined voting power
of all classes of stock of the Company, such option by its terms is not
exercisable after the expiration of five (5) years from the date such option is
granted. Each option may be exercised for a period of up to one hundred
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twenty (120) months from the date of grant, subject to the vesting provisions
set forth herein and to a determination of the Committee that an option may
expire in such lesser period of time as they may determine in their sole
discretion. The termination of the Plan shall not alter the maximum duration,
the vesting provisions, or any other term or condition of any option granted
prior to the termination of the Plan.
To the extent the right to purchase Shares has vested under a Participant's
stock option agreement, options may be exercised from time to time by delivering
payment in full at the Option Price for the number of Shares being purchased by
either: (i) cash, certified check, official bank check or the equivalent thereof
acceptable to the Company; or (ii) shares of the Company's Common Stock with a
fair market value on the date of exercise equal to the Option Price; or (iii) a
combination of (i) and (ii) above; together with written notice to the Secretary
of the Company identifying the option or part thereof being exercised and
specifying the number of Shares for which payment is being tendered. The
Company shall deliver to the Optionee, which delivery shall be not less than
fifteen (15) days and not more than thirty (30) days after the giving of such
notice, without transfer or issue tax to the Optionee (or other person entitled
to exercise the option) at the principal office of the Company, or such other
place as shall be mutually acceptable, a certificate or certificates for such
Shares dated the date the options were validly exercised; provided, however,
that the time of such delivery may be postponed by the Company for such period
as may be required for it with reasonable diligence to comply with any
requirements of law. If an option covers incentive and non-statutory stock
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options, separate stock certificates shall be issued; one or more for stock
acquired upon exercise of the incentive stock options and one or more for the
stock acquired upon exercise of the non-statutory stock options.
(e) TERMINATION OF EMPLOYMENT, OR DIRECTOR OR OFFICER STATUS. Upon the
termination of an Optionee's status as an employee, director or officer of the
Company, his or her rights to exercise an option then held shall be only as
follows:
DEATH OR DISABILITY: If an Optionee's employment or status as an
officer or director is terminated by death or disability, such Optionee or such
Optionee's qualified representative (in the event of the Optionee's mental
disability) or the Optionee's estate (in the event of the Optionee's death)
shall have the right for a period of twelve (12) months following the date of
such death or disability to exercise the option to the extent the Optionee was
entitled to exercise such option on the date of the Optionee's death or
disability, provided the actual date of exercise is in no event after the
expiration of the term of the option.
An Optionee's "estate" shall mean the Optionee's legal representative
or any person who acquires the right to exercise an option by reason of the
Optionee's death.
CAUSE: If an employee or officer is determined by the Board of
Directors to have committed an act of embezzlement, fraud, dishonesty, breach of
fiduciary duty to the Company, or to have deliberately disregarded the rules of
the Company which resulted in loss, damage or injury to the Company, or if an
Optionee makes any unauthorized disclosure of any of the secrets or confidential
information of
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the Company, induces any client or customer of the Company to break any contract
with the Company or induces any principal for whom the Company acts as agent to
terminate such agency relations, or engages in any conduct which constitutes
unfair competition with the Company, or if an Optionee is removed from any
office of the Company by any bank regulatory agency or by judicial process, the
Optionee or the Optionee's estate shall be entitled to exercise any option with
respect to any Shares for a period of thirty (30) days after termination of
employment or status as a director or officer. The Optionee may receive payment
from the Company for vacation pay, for services rendered prior to termination,
for services for the day on which termination occurred, for salary in lieu of
notice, or for other benefits. In making such determination, the Board of
Directors shall act fairly and shall give the Optionee an opportunity to appear
and be heard at a hearing before the full Board of Directors and present
evidence on the Optionee's behalf. For the purpose of this paragraph,
termination of employment or officer status shall be deemed to occur when the
Company dispatches notice or advice to the Optionee that the Optionee's
employment or status as an officer is terminated and not at the time of
Optionee's receipt thereof.
OTHER REASONS: If an Optionee's employment or status as a director or
officer is terminated for any other reason other than those mentioned above
under "Death or Disability" and "Cause", the Optionee may, within three (3)
months and one (1) day following such termination, exercise the option to the
extent such option was exercisable by the Optionee on the date of termination of
the Optionee's employment
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or status as a director or officer, provided the date of exercise is in no event
after the expiration of the term of the option.
(f) TRANSFERABILITY OF OPTION. Each option shall be transferable only by
will or the laws of descent and distribution or pursuant to a qualified domestic
relations order as defined by the Code and shall be exercisable during the
Optionee's lifetime only by the Optionee.
(g) OTHER TERMS AND CONDITIONS. Options may also contain such other
provisions, which shall not be inconsistent with any of the foregoing terms, as
the Committee shall deem appropriate. No option, however, nor anything
contained in the Plan, shall confer upon any Optionee any right to continue in
the employ or in the status as an officer of the Company, nor limit in any way
the right of the Company to terminate an Optionee's employment or status as an
officer at any time.
Nor shall any option, nor anything contained in the Plan, obligate the
Company or any Affiliate to continue any Optionee's status as a director or to
vote any shares held by the Company's proxy holders in favor of any Optionee at
any shareholders' meeting of the Company at which directors are to be elected.
(h) USE OF PROCEEDS FROM STOCK. Proceeds from the sale of Shares pursuant
to the exercise of options granted under the Plan shall constitute general funds
of the Company.
(i) RIGHTS AS A SHAREHOLDER. The Optionee shall have no rights as a
shareholder with respect to any Shares until the date of issuance of a stock
certificate for such Shares. No adjustment shall be made for dividends or other
rights for which
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the record date is prior to the date of such issuance, except as provided in
Section 6 hereof.
(j) EXERCISABILITY OF INCENTIVE STOCK OPTIONS. The aggregate fair market
value (determined at the time the option is granted) of the stock with respect
to which incentive stock options are exercisable for the first time by an
optionee during any calendar year (under all such plans of the Company) shall
not exceed $100,000. Any option not complying with this Section 5(j) shall be a
non-statutory stock option.
(k) TAX WITHHOLDING. The Company may determine that it is required to
withhold taxes relating to the exercise of any option and that such tax
withholding shall be satisfied in a manner satisfactory to the Company before
Shares pursuant to the exercise of an option are delivered to an Optionee. The
Optionee may elect to pay such tax upon the exercise of a stock option by
surrendering a sufficient number of previously issued shares. The value of
Shares surrendered shall be the fair market value of such Shares on the date the
exercise becomes taxable. The election to withhold shares otherwise deliverable
upon exercise of the option, or to surrender previously issued shares, shall be
subject to the approval of the Committee and must be made pursuant to rules
established by the Committee.
6. ADJUSTMENT OF AND CHANGES IN THE SHARES
In the event the shares of Common Stock of the Company, as presently
constituted, shall be changed into or exchanged for a different number or kind
of shares of stock or other securities of the Company or of another corporation
(whether by reason of reorganization, merger, consolidation, recapitalization,
reclassification,
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split-up, combination of shares or otherwise), or if the number of shares of
Common Stock of the Company shall be increased through the payment of a stock
dividend or increased or decreased through a stock split, the Board of Directors
shall substitute for or add to each share of Common Stock of the Company
theretofore appropriated or thereafter subject or which may become subject to an
option under the Plan, the number and kind of shares of stock or other
securities into which each outstanding share of Common Stock of the Company
shall be so changed, or for which each share shall be exchanged, or to which
each such share shall be entitled, as the case may be. In addition, the
Committee shall make appropriate adjustment in the number and kind of shares as
to which outstanding options, or portions thereof then unexercised, shall be
exercisable so that any Optionee's proportionate interest in the Company by
reason of his rights under unexercised portions of such options shall be
maintained as before the occurrence of such event. Such adjustment in
outstanding options shall be made without change in the total price of the
unexercised portion of the option and with a corresponding adjustment in the
option price per share.
In the event of sale, dissolution or liquidation of the Company or a merger
or consolidation in which the Company is not the surviving or resulting
corporation, the Committee shall have the power to cause the termination of
every option outstanding hereunder, except that the surviving or resulting
corporation may, in its absolute and uncontrolled discretion, tender an option
or options to purchase its shares on its terms and conditions, both as to the
number of shares and otherwise; provided, however, that in all events the
Optionee shall have the right immediately prior to such
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sale, dissolution, liquidation, or merger or consolidation in which the Company
is not the surviving or resulting corporation to notification thereof as soon as
practicable and, thereafter, to exercise the Optionee's option to purchase
Shares to the extent of any vested and unexercised portion of the option. This
right of exercise shall be conditioned upon the execution of a final plan of
dissolution or liquidation or a definitive agreement of merger or consolidation.
In the event of an offer by any person or entity to all shareholders of the
Company to purchase any or all shares of Common Stock of the Company (or shares
of stock or other securities which shall be substituted for such shares or to
which such shares shall be adjusted as provided in Section 6 hereof), any
Optionee under this Plan shall have the right upon the commencement of such
offer to exercise the option and purchase shares subject thereto subject to the
vesting provisions of Section 5(b) and (d) hereof.
No right to purchase fractional shares shall result from any adjustment in
options pursuant to this Section 6. In case of any such adjustment, the shares
subject to the option shall be rounded down to the nearest whole share. Notice
of any adjustment shall be given by the Company to each holder of an option
which was in fact so adjusted and such adjustment (whether or not such notice is
given) shall be effective and binding for all purposes of the Plan.
To the extent the foregoing adjustments relate to stock or securities of
the Company, such adjustments shall be made by the Committee, whose
determination in that respect shall be final, binding and conclusive. Any issue
by the Company of
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shares of stock of any class, or securities convertible into shares of any
class, shall not affect the number or price of shares of Common Stock subject to
the option, and no adjustment by reason thereof shall be made.
The grant of an option pursuant to the Plan shall not affect in any way the
right or power of the Company to make adjustments, reclassifications,
reorganizations or changes of its capital or business structure or to merge or
to consolidate or to dissolve, liquidate or sell, or transfer all or any part of
its business or assets.
7. LISTING OR QUALIFICATION OF SHARES
All options granted under the Plan are subject to the requirement that if
at any time the Board of Directors or the Committee shall determine in its
discretion that the listing or qualification of the Shares subject thereto on
any securities exchange or under any applicable law, or the consent or approval
of any governmental regulatory body, is necessary or desirable as a condition of
or in connection with the issuance of Shares under the option, the option may
not be exercised in whole or in part unless such listing, qualification, consent
or approval shall have been effected or obtained free of any condition not
acceptable to the Board of Directors or the Committee.
8. AMENDMENT AND TERMINATION OF THE PLAN
The Board of Directors shall have complete power and authority to terminate
or amend the Plan; provided, however, that the Board of Directors shall not,
without the approval of the shareholders of the Company, (i) materially increase
the benefits accruing to Participants under the Plan; (ii) increase the number
of securities which
15
may be issued under the Plan; or (iii) modify the requirements as to eligibility
for participation in the Plan; and provided further that the terms set forth in
Section 5 of the Plan shall not be amended more than once every six months,
other than to comport with changes in the Internal Revenue Code, the Employee
Retirement Income Security Act, or the rules thereunder. Except as provided in
Section 6, no termination, modification or amendment of the Plan may, without
the consent of an employee, director or officer to whom such option shall
theretofore have been granted, adversely affect the rights of such employee,
director or officer under such option. Unless the Plan shall have been
terminated by action of the Board of Directors prior thereto, it shall terminate
ten (10) years from the earlier of its adoption by the Board of Directors or
approval by the Company's shareholders, unless earlier terminated by the Board
of Directors.
Unless the Plan shall have been terminated by action of the Board of
Directors prior thereto, the Plan shall terminate on February 22, 2005 (ten
years from its adoption).
9. BINDING EFFECT OF CONDITIONS
The conditions and stipulations herein contained, or in any option granted
pursuant to the Plan shall be, and constitute, a covenant running with all of
the Shares acquired by the optionee pursuant to this Plan, directly or
indirectly, whether the same have been issued or not, and those Shares owned by
the optionee shall not be sold, assigned or transferred by any person save and
except in accordance with the terms and conditions herein provided, and the
optionee shall agree to use best efforts to cause the officers of the Company to
refuse to record on the books of the
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Company any assignment or transfer made or attempted to be made except as
provided in the Plan and to cause said officers to refuse to cancel old
certificates or to issue or deliver new certificates therefor where the
purchaser or assignee has acquired certificates or the Shares represented
thereby, except strictly in accordance with the provisions of the Plan.
10. EFFECTIVENESS OF THE PLAN
The Plan shall become effective only upon approval by the Board of
Directors. The grant of any options pursuant to the Plan shall be conditioned
upon the registration of the Shares with the Securities and Exchange Commission
and Qualification of the offer and sale of the Shares pursuant to the Plan with
the Commissioner of Corporations of the State of California, unless in the
opinion of counsel to the Company such registration or qualification is not
necessary.
11. PRIVILEGES OF STOCK OWNERSHIP; SECURITIES LAW COMPLIANCE;
NOTICE OF SALE
No optionee shall be entitled to the privileges of stock ownership as to
any Shares not actually issued and delivered to the optionee. No Shares shall
be purchased upon the exercise of any option unless and until any applicable
requirements of any regulatory agencies having jurisdiction, and of any
exchanges upon which the Common Stock of the Company may be listed, shall have
been satisfied. The Company shall diligently endeavor to comply with all
applicable securities laws before any options are granted under the Plan and
before any Shares
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are issued pursuant to the exercise of such options. The optionee shall give
the Company notice of any sale or other disposition of any such Shares not more
than five (5) days after such sale or other disposition.
12. INDEMNIFICATION
The Company shall indemnify its "agents", as defined in Section 317 of the
California Corporations Code, to the full extent permitted by Section 317, as
amended from time to time, or as permitted by any successor statute to Section
317, and by the Company's Articles of Incorporation and Bylaws.
13. INFORMATION TO OPTIONEES
The Company shall provide to each optionee during the period for which he
or she has one or more options outstanding, copies of all annual reports and
other information which are provided to all shareholders of the Company.
Adopted: February 22, 1995.
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COAST BANCORP
1995 NON-QUALIFIED
STOCK OPTION AGREEMENT
Date of Grant:
TO:
We are pleased to notify you that Coast Bancorp (the "Company") this
day hereby grants to you an option to purchase all or any part of __________
shares of the Common Stock of the Company (the "Shares") at the Option Price of
_________ per share (the "Option") as a Stock Option under the Company's 1995
Amended and Restated Stock Option Plan (the "Plan").
THIS OPTION MAY BE EXERCISED ONLY IN ACCORDANCE WITH THE TERMS OF THE
PLAN. ONLY CERTAIN PROVISIONS OF THE PLAN ARE SUMMARIZED IN THIS AGREEMENT. A
COPY OF THE PLAN IS PROVIDED WITH THIS AGREEMENT.
THIS OPTION MAY BE EXERCISED ONLY IF THE PLAN IS APPROVED BY
SHAREHOLDERS HOLDING A MAJORITY OF THE ISSUED AND OUTSTANDING SHARES OF THE
COMPANY.
1. PURPOSE OF THE OPTION.
One of the purposes of the Plan is to advance the interests of the
Company by stimulating the efforts of officers, directors and full-time salaried
employees on behalf of the Company, by granting them financial participation in
the progress and success of the Company.
1
2. SIGNATURE ON OPTION AGREEMENT.
This option cannot be exercised unless you first sign this document in
the place provided and return it to the Secretary of the Company. If you fail
to do so, this option will terminate and be of no effect. However, your signing
and delivering this letter will not bind you to purchase any of the shares
subject to the option. Your obligation to purchase the Shares can arise only
when you exercise this option in the manner set forth in Paragraph 3 below.
3. TERMS OF OPTION AND EXERCISE OF OPTION.
Subject to the provisions of Paragraph 4 below and this Paragraph 3,
this option can be exercised by you at any time during a period of
________________________ (___________) months from the granting date as follows:
(a) After the expiration of ____________________ (_______)
months from the granting date, this option may be exercised to the extent of not
more than ____________________ percent (___________%) of the Shares.
(b) After the expiration of _________________ (__________)
months from the granting date, this option may be exercised to the extent of
________________ percent (________%) of the shares.
(c) After the expiration of __________________ (_________)
months from the granting date, this option my be exercised to the extent of
___________________ percent (________%) of the Shares.
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(d) After the expiration of _________________ (_________) months
from the granting date, this option may be exercised to the extent of
_______________ percent (________%) of the Shares.
(e) After the expiration of _______________ (_________) months
from the granting date, this option may be exercised to the extent of
________________ percent (_________%) of the Shares.
(f) After the expiration of __________________ (______) months
from the granting date, this option may be exercised to the extent of
______________ percent (_______%) of the Shares.
Any portion of the options that you do not exercise shall accumulate
and can be exercised by you any time prior to the expiration of ______________
(____) months from the granting date.
This option may be exercised by delivering to the Secretary of the
Company, payment in full at the Option Price for the number of Shares being
purchased in either: (i) cash or by certified check or official bank check or
the equivalent thereof acceptable to the Company; or (ii) shares of the
Company's Common Stock with a fair market value on the date of exercise equal to
the Option Price; or (iii) a combination of (i) and (ii) above; together with a
written notice in a form satisfactory to the Company, signed by you specifying
the number of Shares you then desire to purchase and the time of delivery
thereof, which shall not be less than fifteen (15) days and not more than thirty
(30) days after the giving of such notice unless an earlier or later date is
mutually agreed upon. At such time, the Company shall, without transfer or
issue tax to you (or such other person entitled to exercise the option), deliver
to you (or such
3
other person entitled to exercise the option) at the principal office of the
Company, or such other place as shall be mutually acceptable a certificate or
certificates for such shares dated the date the options were validly exercised;
provided, however, that the time of such delivery may be postponed by the
Company for such period as may be required for it with reasonable diligence to
comply with any requirements of law. No fractional shares shall be issued or
delivered.
As a holder of an option, you shall have the rights of a shareholder
with respect to the Shares subject to this option only after such Shares shall
have been issued to you upon the exercise of this option.
4. TERMINATION OF OFFICER OR DIRECTOR STATUS OR
EMPLOYMENT.
If your status as an employee, director or officer of the Company or
its Affiliates (as such term is defined in the Plan) is terminated for any
reason other than death, disability or cause, this option may be exercised
within three (3) months and one (1) day from the date of such termination to the
extent you were entitled to exercise the option on the date of termination, but
in no event may this option be exercised after the expiration of the term of
this option. If, however, you are removed from your office as an officer or
director or your employment with the Company or its Affiliate is terminated for
cause as defined in the Plan, this option shall expire thirty (30) days after
the time notice or advice of such removal or termination is dispatched by the
Company or its Affiliates, or in the instance of a non-employee director at the
time of any removal
4
proceeding by any appropriate bank regulatory agency or by judicial process and
notwithstanding anything else herein to the contrary, neither you nor your
estate shall be entitled to exercise any option with respect to any Shares
whatsoever after thirty (30) days following such removal or termination.
5. DEATH OR DISABILITY.
If you die or become disabled while an officer, director or employee
of the Company or its Affiliates, the option may be exercised in whole or in
part by you or your qualified representative (in the event of your mental
disability) or by the duly authorized executor of your Will or by the duly
authorized administrator or special administrator of your estate (in the event
of your death) within twelve (12) months from the date of your death or
disability to the extent that you had the right to exercise this option on the
date of your death or disability, but in no event after the expiration of the
term of this option.
Disability shall be determined by the Company's Stock Option
Committee.
6. NONTRANSFERABILITY OF OPTION.
This option shall not be transferable except by Will or the laws of
descent and distribution, and this option may be exercised during your lifetime
only by you. Any purported transfer or assignment of this option shall be void
and of no effect, and shall give the Company the right to terminate this option
as of the date of such purported transfer or assignment.
7. ADJUSTMENT OF AND CHANGES IN THE SHARES.
Notwithstanding the preceding provisions of this option agreement,
upon receipt of notice from the Stock Option Committee or the Board of Directors
of the
5
pendency of dissolution or liquidation of the Company or a reorganization,
merger, or consolidation of the Company with one or more corporations as a
result of which the Company will not be the surviving corporation, or a sale of
substantially all the assets and property of the Company to another person (a
"Terminating Event"), this option shall be exercisable to the extent of any
vested and unexercised portion of the option. Upon the date thirty (30) days
after receipt of said notice, this option or any portion hereof not exercised
shall terminate, unless provision shall be made in connection with the
Terminating Event for assumption of this option or for substitution for this
option of new options covering stock of a successor employer corporation, or a
parent or subsidiary corporation thereof, solely at the option of such successor
corporation or parent or subsidiary corporation, with appropriate adjustments as
to the number and kind of shares and prices.
8. SUBJECT TO TERMS OF THE PLAN.
This Agreement shall be subject in all respects to the terms and
conditions of the Plan. Your signature herein represents your acknowledgment of
receipt of a copy of the Plan. Any dispute or disagreement which shall arise
under or as a result of or pursuant to this agreement shall be finally and
conclusively determined by the Board of Directors of the Company or duly
appointed Committee in its sole discretion, and such determination shall be
binding upon all parties.
9. GRANT AND EXERCISE OF OPTION: CONDITIONS.
The grant of this option is conditioned upon approval of the Plan by
the shareholders of the Company, registration of the Shares with the Securities
and
6
Exchange Commission and qualification of the offer and sale of the Shares to be
issued under the Plan by the Commissioner of Corporations of the State of
California, unless in the opinion of counsel to the Company such registration or
qualification is not necessary.
10. TAX EFFECTS.
THE FEDERAL TAX CONSEQUENCES OF EMPLOYEE OR DIRECTOR STOCK OPTIONS ARE
COMPLEX AND SUBJECT TO CHANGE. A TAXPAYER'S PARTICULAR SITUATION MAY BE SUCH
THAT SOME VARIATION OF THE GENERAL RULE IS APPLICABLE. ACCORDINGLY, AN OPTIONEE
(OR HIS GUARDIAN, ESTATE OR LEGATEE) SHOULD CONSULT WITH HIS OWN TAX ADVISOR
BEFORE EXERCISING ANY OPTION OR DISPOSING OF ANY SHARES ACQUIRED UPON THE
EXERCISE OF AN OPTION.
11. RIGHTS AS A SHAREHOLDER.
You have no rights as a shareholder of the Company with respect to any
Shares until the date of the issuance of a stock certificate to you for such
Shares.
12. NOTIFICATION OF SALES.
You agree that you, or any person acquiring Shares upon exercise of
this Option, will notify the Company not more than five (5) days after any sale
or disposition of such Shares.
13. INFORMATION TO OPTIONEES.
The Company shall provide to you during the period for which you have
one or more options outstanding copies of all annual reports and other
information which are provided to all shareholders of the Company.
7
14. TAX WITHHOLDING.
Where in the opinion of counsel to the Company it would be appropriate
for the Company to withhold taxes relating to the exercise of any option, the
Committee may in its discretion require that such tax obligation be satisfied in
a manner satisfactory to the Company before shares deliverable pursuant to the
exercise of such option are transferred to the optionee. The optionee may make
an election to pay such tax by surrendering a sufficient number of previously
issued Shares. The value of Shares surrendered shall be the fair market value
of such Shares on the date the exercise becomes taxable. The election to
withhold shares otherwise deliverable upon exercise of the option, or to
surrender previously issued Shares, shall be subject to the approval of the
Committee and must be made pursuant to rules established by the Committee.
Coast Bancorp
By:
----------------------------
Its:
--------------------------
Agreed to this day of , 19 .
------ --------------- -----
- -------------------------
Signature of Optionee
8
COAST BANCORP
1995 INCENTIVE STOCK OPTION AGREEMENT
Date of Grant:
TO:
We are pleased to notify you that Coast Bancorp (the "Company") this
day hereby grants to you an option to purchase all or any part of
_______________ shares of the Common Stock of the Company (the "Shares") at the
Option Price of _________ per share (the "Option") as a Stock Option under the
Company's Amended and Restated 1995 Stock Option Plan (the "Plan").
THIS OPTION MAY BE EXERCISED ONLY IN ACCORDANCE WITH THE TERMS OF THE
PLAN. ONLY CERTAIN PROVISIONS OF THE PLAN ARE SUMMARIZED IN THIS AGREEMENT. A
COPY OF THE PLAN IS PROVIDED WITH THIS AGREEMENT.
THIS OPTION MAY BE EXERCISED ONLY IF THE PLAN IS APPROVED BY
SHAREHOLDERS HOLDING A MAJORITY OF THE ISSUED AND OUTSTANDING SHARES OF THE
COMPANY.
1. PURPOSE OF THE OPTION.
One of the purposes of the Plan is to advance the interests of the
Company by stimulating the efforts of officers and full-time salaried employees
on behalf of the Company, by granting them financial participation in the
progress and success of the Company.
1
2. SIGNATURE ON OPTION AGREEMENT.
This option cannot be exercised unless you first sign this document in
the place provided and return it to the Secretary of the Company. If you fail
to do so, this Option will terminate and be of no effect. However, your signing
and delivering this letter will not bind you to purchase any of the shares
subject to this Option. Your obligation to purchase the Shares can arise only
when you exercise this Option in the manner set forth in Paragraph 3 below.
3. TERMS OF OPTION AND EXERCISE OF OPTION.
The aggregate fair market value (as determined at the time the option
is granted) of the shares pursuant to this Agreement which are exercisable by
you for the first time during any calendar year shall not exceed $100,000 under
ALL stock option plans of the Company, its affiliates or any predecessor of any
such corporation.
Subject to the provisions of Paragraph 4 below and this Paragraph 3,
this Option can be exercised by you at any time during a period of
_________________ (________) months from the granting date as follows:
(a) After the expiration of ___________________ (_________)
months from the granting date, this Option may be exercised to the extent of
___________________ percent (________%) of the Shares;
(b) After the expiration of _________________ (________) months
from the granting date, this Option may be exercised to the extent of
________________ percent (________%) of the Shares;
2
(c) After the expiration of _______________ (_______) months
from the granting date, this Option may be exercised to the extent of
_____________ percent (________%) of the Shares;
(d) After the expiration of _______________ (______) months from
the granting date, this Option may be exercised to the extent of ______________
percent (________%) of the Shares;
(e) after the expiration of ________________ (_________) months
from the granting date, this Option may be exercised to the extent of
______________ percent (________%) of the Shares.
Any portion of the Option that you do not exercise shall accumulate
and can be exercised by you any time prior to the expiration of ____________
(____) months from the date of grant.
This Option may be exercised by delivering to the Secretary of the
Company payment in full at the Option Price for the number of Shares being
purchased in either: (i) cash or by certified check or official bank check or
the equivalent thereof acceptable to the Company; or (ii) shares of the
Company's Common Stock with a fair market value on the date of exercise equal to
the Option Price; or (iii) a combination of (i) and (ii) above; together with a
written notice in a form satisfactory to the Company, signed by you specifying
the number of Shares you then desire to purchase and the time of delivery
thereof, which shall not be less than fifteen (15) days and not more than thirty
(30) days after the giving of such notice unless an earlier or later date is
mutually agreed upon. At such time the Company shall, without transfer or issue
tax deliver to you (or
3
such other person entitled to exercise the option) at the principal office of
the Company, or such other place as shall be mutually acceptable, a certificate
or certificates for such Shares dated the date the Options were validly
exercised; provided, however, that the time of such delivery may be postponed by
the Company for such period as may be required for it with reasonable diligence
to comply with any requirements of law. No fractional Shares shall be issued or
delivered.
As a holder of an Option, you shall have the rights of a shareholder
with respect to the Shares subject to this Option only after such Shares shall
have been issued to you upon the exercise of this option.
4. TERMINATION OF OFFICE OR EMPLOYMENT.
If your status as an employee or officer of the Company or its
Affiliates (as such term is defined in the Plan) is terminated for any reason
other than death, disability or cause, this Option may be exercised within three
(3) months and one (1) day from the date of such termination to the extent you
were entitled to exercise the Option on the date of termination, but in no event
may this Option be exercised after the expiration of the term of this Option.
If, however, you are removed from your office or your employment with the
Company or its Affiliates is terminated for cause as defined in the Plan, this
Option shall expire thirty (30) days after the time notice or advice of such
removal or termination is dispatched by the Company or its Affiliates and
notwithstanding anything else herein to the contrary, neither you nor your
estate shall be entitled to exercise any Option with respect to any Shares
whatsoever after thirty (30) days following such removal or termination.
4
5. DEATH OR DISABILITY.
If you die or become disabled while an officer or employee of the
Company or its Affiliates, the Option may be exercised in whole or in part by
you or your qualified representative (in the event of your mental disability) or
by the duly authorized executor of your Will or by the duly authorized
administrator or special administrator of your estate (in the event of your
death) within twelve (12) months from the date of your death or disability to
the extent that you had the right to exercise this Option on the date of your
death or disability, but in no event after the expiration of the term of this
Option.
Disability shall be determined by the Company's Stock Option
Committee.
6. NONTRANSFERABILITY OF OPTION.
This Option shall not be transferable except by Will or the laws of
descent and distribution, and this Option may be exercised during your lifetime
only by you. Any purported transfer or assignment of this Option shall be void
and of no effect, and shall give the Company the right to terminate this Option
as of the date of such purported transfer or assignment.
7. ADJUSTMENT OF AND CHANGES IN THE SHARES.
Notwithstanding the preceding provisions of this Option Agreement,
upon receipt of notice from the Stock Option Committee or the Board of Directors
of the pendency of dissolution or liquidation of the Company or a
reorganization, merger, or consolidation of the Company with one or more
corporations as a result of which the Company will not be the surviving
corporation, or a sale of substantially all the assets and property of the
Company to another person (a "Terminating Event"), this Option shall
5
be exercisable to the extent of any vested and unexercised portion of the
option. Upon the date thirty (30) days after receipt of said notice, this
Option or any portion hereof not exercised shall terminate, unless provision
shall be made in connection with the Terminating Event for assumption of this
Option or for substitution for this Option of new options covering stock of a
successor employer corporation, or a parent or subsidiary corporation thereof,
solely at the option of such successor corporation or parent or subsidiary
corporation, with appropriate adjustments as to the number and kind of shares
and prices.
8. SUBJECT TO TERMS OF THE PLAN.
This Agreement shall be subject in all respects to the terms and
conditions of the Plan. Your signature herein represents your acknowledgement
of receipt of a copy of the Plan. Any dispute or disagreement which shall arise
under or as a result of or pursuant to this Agreement shall be finally and
conclusively determined by the Board of Directors of the Company or duly
appointed Committee in its sole discretion, and such determination shall be
binding upon all parties.
9. GRANT AND EXERCISE OF OPTION: CONDITIONS.
The grant of this option is conditioned upon approval of the Plan by
the shareholders of the Company, registration of the Shares with the Securities
and Exchange Commission and qualification of the offer and sale of the Shares to
be issued under the Plan by the Commissioner of Corporations of the State of
California, unless in the opinion of counsel to the Company such registration or
qualification is not necessary.
6
10. TAX EFFECTS.
THE FEDERAL TAX CONSEQUENCES OF EMPLOYEE STOCK OPTIONS ARE COMPLEX AND
SUBJECT TO CHANGE. A TAXPAYER'S PARTICULAR SITUATION MAY BE SUCH THAT SOME
VARIATION OF THE GENERAL RULE IS APPLICABLE. ACCORDINGLY, AN OPTIONEE (OR HIS
GUARDIAN, ESTATE OR LEGATEE) SHOULD CONSULT WITH HIS OWN TAX ADVISOR BEFORE
EXERCISING ANY OPTION OR DISPOSING OF ANY SHARES ACQUIRED UPON THE EXERCISE OF
AN OPTION.
11. RIGHTS AS A SHAREHOLDER.
You have no rights as a shareholder of the Company with respect to any
Shares until the date of the issuance of a stock certificate to you for such
Shares.
12. NOTIFICATION OF SALES.
You agree that you, or any person acquiring Shares upon exercise of
this Option, will notify the Company not more than five (5) days after any sale
or disposition of such Shares.
13. INFORMATION TO OPTIONEES.
The Company shall provide to you during the period for which you have
one or more options outstanding copies of all annual reports and other
information which are provided to all shareholders of the Company.
14. TAX WITHHOLDING.
Where in the opinion of counsel to the Company it would be appropriate
for the Company to withhold taxes relating to the exercise of any option, the
Committee may in its discretion require that such tax obligation be satisfied in
a manner satisfactory to
7
the Company before shares deliverable pursuant to the exercise of such option
are transferred to the optionee. The optionee may make an election to pay such
tax by surrendering a sufficient number of previously issued Shares. The value
of Shares surrendered shall be the fair market value of such Shares on the date
the exercise becomes taxable. The election to withhold shares otherwise
deliverable upon exercise of the option, or to surrender previously issued
Shares, shall be subject to the approval of the Committee and must be made
pursuant to rules established by the Committee.
Coast Bancorp
By:
--------------------------
Its:
-------------------------
Agreed to this day of , 19 .
----- --------------- ----
- --------------------------
Signature of Optionee
8