EXHIBIT 99.2
MAGIC VALLEY BANK
INCENTIVE STOCK OPTION PLAN
(AS ADOPTED BY SNAKE RIVER BANCORP, INC.)
1. PURPOSE. The purpose of this Incentive Stock Option Plan is
to secure for Magic Valley Bank (the "Bank") and its stockholders the
benefits of the incentive inherent in common stock ownership by die
employees of the Bank who will be largely responsible for the Bank's
future growth and continued financial success. It is intended that this
purpose will be effected through the granting of stock options under the
Plan.
2. DEFINITIONS. For purposes of this Plan:
(a) "Bank" shall mean Magic Valley Bank.
(b) "Code" shall mean the Internal Revue Code of 1986, as amended.
(c) "Common Stock" shall mean the Bank's common stock.
(d) "Disability" or "Disabled" shall mean a participant's
permanent and total disability as defined in Section 22(e)(3) of the Code,
(e) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
(f) "Fair Market Value" shall mean:
(1) The fair market value of a share of the Bank's common
stock is the last sale price reported by any stock
exchange on which the Bank's common stock is listed or
by Nasdaq if the Bank's common stock is traded over the
counter on the business day immediately preceding the
date as of which fair market value is being determined
or, if there were no sales of shares of the Bank's
common stock reported by an exchange or by Nasdaq on
such day, on the most recently preceding day on which
there were sales, or
(2) the shares of the Bank's common stock are not listed on
a stock exchange or admitted to trading on Nasdaq on the
day as of which the determination is made, the amount
determined by the Committee to be the fair market value
of a share on such day.
(g) "Retirement" shall mean termination of the employment of an
employee with the Bank on or after (1) the employee's 65th birthday or (ii) the
employee's 55th birthday if the employee has completed 10 years of service with
the Bank.
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(h) "Option Period" shall mean the period of time set forth in
paragraph 5(b)(3) hereof.
3. ADMINISTRATION. The Plan shall be administered under the supervision
of a committee (the "Committee") which shall be appointed by the Board of
Directors of the Bank. The Committee shall consist of members of the Board who
meet the definition of "Non-Employee Directors" under the provisions of the
Exchange Act or rules or regulations promulgated thereunder. No member of the
Committee shall be eligible to participate in the Plan or to receive an award of
options under the Plan.
The Committee, from time to time, may adopt rules and regulations for
carrying out the provisions and purposes of the Plan and make such other
determinations, not inconsistent with the terms of the Plan, as the Committee
shall deem appropriate. The interpretation and construction of any provision of
the Plan by the Committee shall be final and conclusive.
The Committee shall maintain a written record of its proceedings. A
majority of the Committee shall constitute a quorum, and the acts of a majority
of the members present at any meeting at which a quorum is present, or acts
unanimously approved in writing, shall be the acts of the Committee.
4. ELIGIBILITY. Options and awards may be granted only to present or
future employees of the Bank. Any employee of the Bank shall be eligible to
receive one or more options or awards under the Plan. Any director who is not an
employee of the Bank and any member of the Committee, during the time of the
member's service as such or thereafter, shall be ineligible to receive an option
or award under the Plan.
5. STOCK OPTIONS. Stock options under the Plan shall consist of
incentive stock options under Section 422 of the Code.
Each option shall be subject to the following terms and conditions:
(a) Grant of Options. The Committee shall (1) determine in
accordance with Section 422 of the Code the employees of the Bank to whom
options may from time to time be granted, (2) determine the number of shares to
be covered by each option so granted, (3) determine the terms and conditions
(not inconsistent with the Plan) of any option granted hereunder, and (4)
prescribe the form of the instruments necessary or advisable in the
administration of options.
(b) Terms and Conditions of Option. Any option granted under the
Plan shall be evidenced by a Stock Option Agreement executed by the Bank and the
optionee, in such form as the Committee shall approve, which agreement shall be
subject to the following terms and conditions and shall contain such additional
terms and conditions not inconsistent with the Plan, and with the provisions of
the Code applicable to incentive stock options, as the Committee shall
prescribe:
(1) Number of Shares Subject to an Option. The Stock Option
Agreement shall specify the number of shares of Common
Stock subject to the Agreement.
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(2) Option Price. The purchase price per share of Common
Stock purchasable under an option will be determined by
the Committee but will be not less than the Fair Market
Value of a share of Common Stock on the date of the
grant of such option.
(3) Option Period. The period of each option shall be fixed
by the Committee, but no option shall be exercisable
after the expiration of five years from the date the
option is granted.
(4) Consideration. Each optionee, as consideration for the
grant of an option, shall remain in the continuous
employ of the Bank for at least one year from the date
of the granting of such option, and no option shall be
exercisable until after the completion of such one year
period of employment by the optionee.
(5) Exercise of Option. An option may be exercised in whole
or in part from time to time during the option period
(or, if determined by the Committee, in specified
installments during the option period) by giving written
notice of exercise to the Bank specifying the number of
shares to be purchased, such notice to be accompanied by
payment in full of the purchase price due either in cash
or in shares of Common Stock of the Bank owned by the
optionee having a Fair Market Value at the date of
exercise equal to such purchase price, or in a
combination of the foregoing. No shares shall be issued
until full payment therefor has been made. An optionee
shall have the rights of a stockholder only with respect
to shares of stock for which certificates have been
issued to the optionee.
(6) Nontransferability of Options. No option granted under
the Plan shall be transferable by the optionee otherwise
than by will or by the laws of descent and distribution,
and such option shall be exercisable during the
optionee's lifetime only by the optionee.
(7) Retirement and Termination of Employment Other than by
Death or Disability. If an optionee shall terminate
employment by reason of retirement or cease to be
employed by the Bank for any reason (other than
termination of employment by reason of death or
Disability) after the optionee shall have been
continuously so employed for one year after the granting
of the option, the option shall be exercisable only to
the extent that the optionee was otherwise entitled to
exercise it at the time of such cessation of employment
with the Bank, but in no event after the date three
months next succeeding such cessation of employment, In
no event, however, shall any such period extend beyond
the Option Period. The Plan does not confer upon any
optionee any right with respect to continuation of
employment by the Bank.
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(8) Disability of Optionee. If an optionee shall cease to be
employed by the Bank by reason of Disability after the
optionee shall have been continuously so employed for
one year after the granting of the option, the option
shall be exercisable only to the extent that the
optionee was otherwise entitled to exercise it at the
time of such cessation of employment with the Bank, but
in no event after the date one year next succeeding such
cessation of employment. In no event, however, shall any
such period extend beyond the Option Period.
(9) Death of Optionee. In the event of the death of the
optionee while in the employ of the Bank or within
whichever period after Retirement or cessation of
employment of the optionee specified in subsection (7)
or (8) is applicable, and provided the optionee shall
have been continuously so employed for one year after
the granting of the option, the option shall be
exercisable by the executors, administrators, devisees
or distributees of the optionee's estate, as the case
may be, at any time following death only to the extent
that the optionee would otherwise have been entitled to
exercise it if the optionee were then living, but in no
event after the date one year next succeeding the
optionee's death. In no event, however, shall any such
period extend beyond the Option Period. The Bank shall
be under no obligation to issue stock thereunder unless
the until the Bank is satisfied that the person or
persons exercising the option are the duly appointed
legal representatives of the deceased optionee's estate
or the proper devisees or distributees thereof.
(10) Amount of Incentive Stock Option. The aggregate Fair
Market Value of the shares of Common Stock of the Bank
(determined at the time of grant of each option) with
respect to which incentive stock options granted under
the Plan and any other plan of the Bank which are
exercisable for the first time by an employee during any
calendar year shall not exceed $100,000 or such other
amount as may be required by the Code.
6. NUMBER OF SHARES SUBJECT TO PLAN. Shares of stock which may be issued
under this Plan shall be authorized and unissued or treasury shares of the
Bank's Common Stock. The maximum number of shares of Common Stock which may be
issued under the Plan shall be 20,000 shares. The obligation of Bank to deliver
shares of its Common Stock upon exercise of the option by any optionee shall be
subject to the condition that if at any time the Committee shall determine in
its discretion that the consent, registration, qualification or approval of any
governmental regulatory body of the option or the shares to be issued pursuant
thereto is required, the option may not be exercised in whole or in part until
such consent, registration, qualification or approval is obtained.
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7. ADJUSTMENT IN THE EVENT OF CHANGE IN STOCK. In the event of changes in
the outstanding Common Stock of the Bank by reason of stock dividends,
recapitalization, mergers, consolidations, split-ups, combinations or exchanges
of shares and the like, the aggregate number and class of shares available under
the Plan, and the number, class and the price of shares subject to outstanding
options and/or awards shall be appropriately adjusted by the Committee, whose
determination shall be conclusive.
8. AMENDMENT OF THE PLAN. The Board of Directors may amend or suspend the
Plan at any time and from time to time. No such amendment of the Plan may,
however, increase the maximum number of shares to be offered under options or
awards, or change the manner of determining the option price, or change the
designation of employees or class of employees eligible to receive options or
awards, or permit the transfer or issue of stock before payment therefor in
full, or, without the written consent of the optionee or participant, alter or
impair any option or award previously granted under the Plan.
9. MISCELLANEOUS.
(a) By accepting any benefits under the Plan, each optionee or
participant and each person claiming under or through such optionee or
participant shall be conclusively deemed to have indicated acceptance and
ratification of, and consent to, any action taken or made to be taken or made
under the Plan by the Bank, the Board, or the Committee.
(b) No participant or any person claiming under or through him shall
have any right or interest, whether vested or otherwise, in the Plan or in any
option or award thereunder, contingent or otherwise, unless and until all of the
terms, conditions and provisions of the Plan and the Agreement that affect such
participant or such other person shall have been complied with.
10. TERM OF THE PLAN. The Plan will be effective upon approval by the
stockholders, the Idaho Department of Finance and the Federal Deposit Insurance
Corporation. The Plan (but not any options theretofore granted under the Plan)
shall terminate on, and no options shall be granted after, the Annual Meeting of
Shareholders of the Bank in 2003, unless sooner suspended or discontinued by
action of the Board of Directors. The expiration of the Plan, however, shall not
affect the rights of optionees under the options theretofore granted to them or
the rights of participants under awards theretofore granted to them, and all
unexpired options and awards shall continue in force and operation after
termination of the Plan except as they may lapse or be terminated by their own
terms and conditions.
PLAN DATED NOVEMBER 19, 1998
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