EXHIBIT 10.1
MEDALLION FINANCIAL CORP.
Amended and Restated 1996 Stock Option Plan
The 1996 Stock Option Plan, amended and restated as of February 25, 1998
(the "Plan"), is intended to encourage ownership of Common Stock, $0.01 par
value (the "Stock") of Medallion Financial Corp. (the "Company") by officers and
employees of the Company and its affiliates so as to provide additional
incentives to promote the success of the Company and its affiliates through the
grant of Incentive Stock Options and Nonstatutory Stock Options (collectively,
as defined below, "Options").
1. Administration of the Plan.
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The Plan shall be administered by the Board of Directors of the Company
(the "Board") or a committee of the Board (the entity administering the Plan
hereafter referred to as "Committee"). Within the limits of the Plan, the
Committee shall determine the individuals to whom, and the times at which,
Options shall be granted, the type of Option to be granted, the duration of each
Option, the price and method of payment for each Option, and the time or times
within which (during its term) all or portions of each Option may be exercised.
The Committee may establish such rules as it deems necessary for the proper
administration of the Plan, make such determinations and interpretations with
respect to the Plan and Options granted under it as may be necessary or
desirable and include such further provisions or conditions in Options granted
under the Plan as it deems advisable. To the extent permitted by law, the
Committee may delegate its authority under the Plan to other individuals;
provided, however, that Options granted to any person subject to Section 16 of
the Securities Exchange Act of 1934 (the "Exchange Act") shall be granted by the
Board or a committee of at least two members thereof, each of whom shall be a
"non-employee director" within the meaning of Rule 16b-3 of the Exchange Act.
In addition, to the degree that Options granted to any person are intended to
qualify as performance-based compensation within the meaning of Section 162(m)
of the Internal Revenue Code of 1986, as amended (the "Code"), such Options
shall be granted by at least two members of the Board who are "outside
directors" within the meaning of Section 162(m) of the Code.
2. Shares Subject to the Plan.
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(a) Number and Type of Shares. The aggregate number of shares of
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Stock of the Company which may be optioned under the Plan is 1,500,000 shares.
In the event that the Committee in its discretion determines that any stock
dividend, split-up, combination or reclassification of shares, recapitalization
or other similar capital change affects the
Stock such that adjustment is required in order to preserve the benefits or
potential benefits of the Plan or any Option granted under the Plan, the maximum
aggregate number and kind of shares or securities of the Company as to which
Options may be granted under the Plan and as to which Options then outstanding
shall be exercisable, and the option price of such Options, shall be
appropriately adjusted by the Committee (whose determination shall be
conclusive) so that the proportionate number of shares or other securities as to
which Options may be granted and the proportionate interest of holders of
outstanding Options shall be maintained as before the occurrence of such event.
(b) Effect of Certain Transactions. In the event of a consolidation
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or merger of the Company with another corporation, or the sale or exchange of
all or substantially all of the assets of the Company, or a reorganization or
liquidation of the Company, each holder of an outstanding Option shall be
entitled to receive upon exercise and payment in accordance with the terms of
the Option the same shares, securities or property as he would have been
entitled to receive upon the occurrence of such event if he had been,
immediately prior to such event, the holder of the number of shares of Stock
purchasable under his Option; provided, however, that in lieu of the foregoing
the Board of Directors of the Company (the "Board") may upon written notice to
each holder of an outstanding Option provide that such Option shall terminate on
a date not less than 20 days after the date of such notice unless theretofore
exercised. In connection with such notice, the Board may in its discretion
accelerate or waive any deferred exercise period. Options granted under this
Plan may contain such provisions as the Committee shall approve permitting part
or all of such options to become exercisable without regard to any deferred
exercise period in the event of a change of control of the Company, as defined
by the Committee.
(c) Restoration of Shares. If any Option expires or is terminated
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unexercised or is forfeited for any reason, the shares subject to such Option,
to the extent of such expiration, termination or forfeiture, shall again be
available for granting Options under the Plan, subject, however, in the case of
Incentive Stock Options, to any requirements under the Code.
(d) Reservation of Shares. The Company shall at all times while the
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Plan is in force reserve such number of shares of Stock as will be sufficient to
satisfy the requirements of the Plan. Shares issued under the Plan may consist
in whole or in part of authorized but unissued shares or treasury shares.
3. Grant of Options; Eligible Persons.
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(a) Types of Options. Options may be granted under the Plan either
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as incentive stock options ("Incentive Stock Options"), as defined in Section
422 of the Code or as Options which do not meet the requirements of Section 422
("Nonstatutory
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Stock Options"). Options may be granted from time to time by the Committee,
within the limits set forth in Sections 1 and 2 of the Plan, to all employees of
the Company or of any parent corporation or subsidiary corporation of the
Company (as defined in Sections 424(e) and (f), respectively, of the Code);
provided, however, that Options with respect to no more than 500,000 shares of
Stock may be granted to any individual in any single calendar year.
(b) Date of Grant. The date of grant for each Option shall be the
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date on which it is approved by the Committee, or such later date as the
Committee may specify. No Incentive Stock Options shall be granted hereunder
after ten years from the date on which the Plan was approved by the Board.
(c) Automatic Awards. The Committee may provide for the automatic
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award of an Option upon the delivery of shares to the Company in payment of an
Option for up to the number of shares so delivered.
4. Form of Options.
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Options granted hereunder shall be evidenced by a writing delivered to the
optionee specifying the terms and conditions thereof and containing such other
terms and conditions not inconsistent with the provisions of the Plan as the
Committee considers necessary or advisable to achieve the purposes of the Plan
or comply with applicable tax and regulatory laws and accounting principles.
The form of such Options may vary among optionees.
5. Option Price.
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The price at which shares may from time to time be optioned shall be
determined by the Committee, provided that such price shall not be less than the
fair market value of the Stock on the date of granting as determined in good
faith by the Committee; and provided further that no Incentive Stock Option
shall be granted to any individual who is ineligible to be granted an Incentive
Stock Option because his ownership of stock of the Company or its parent or
subsidiary corporations exceeds the limitations set forth in Section 422(b)(6)
of the Code unless such option price is at least 110% of the fair market value
of the Stock on the date of grant.
To the extent permitted by law, the Committee may in its discretion permit
the option price to be paid in whole or in part by a note or in installments or
with shares of Stock of the Company or such other lawful consideration as the
Committee may determine; provided, however, that to the degree the option price
is paid through the delivery of Stock such Stock must be "mature" for purposes
of generally accepted accounting principles, i.e., (i) held by the optionee free
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and clear for at least six months prior to the use thereof to pay part of an
option price, (ii)
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purchased by the optionee on the open market, or (iii) meeting any other
requirements for "mature" shares as may exist on the date of the use thereof to
pay part of an option price.
6. Term of Option and Dates of Exercise.
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(a) Exercisability. The Committee shall determine the term of all
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Options, the time or times that Options are exercisable and whether they are
exercisable in installments, provided that the term of each Incentive Stock
Option granted under the Plan shall not exceed a period of ten years from the
date of its grant, and provided further that no Incentive Stock Option shall be
granted to any individual who is ineligible to be granted such Option because
his ownership of stock of the Company or its parent or subsidiary corporations
exceeds the limitations set forth in Section 422(b)(6) of the Code unless the
term of his Incentive Stock Option does not exceed a period of five years from
the date of its grant. In the absence of such determination, the Option shall
be exercisable at any time or from time to time, in whole or in part, during a
period of ten years from the date of its grant or, in the case of an Incentive
Stock Option, the maximum term of such Option.
(b) Effect of Disability, Death or Termination of Employment. The
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Committee shall determine the effect on an Option of the disability, death,
retirement or other termination of employment of an optionee and the extent to
which, and the period during which, the optionee, the optionee's estate, legal
representative, guardian, or beneficiary on death may exercise rights
thereunder. Any beneficiary on death shall be designated by the optionee, in
the manner determined by the Committee, to exercise rights of the optionee in
the case of the optionee's death. In the event no beneficiary is designated or
survives the optionee, the optionee's rights shall pass to the optionee's
estate, to the degree so allowed by the Committee.
(c) Other Conditions. The Committee may impose such conditions with
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respect to the exercise of Options, including conditions relating to applicable
federal or state securities laws, as it considers necessary or advisable.
(d) Withholding. The optionee shall pay to the Company, or make
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provision satisfactory to the Committee for payment of, any taxes required by
law to be withheld in respect of any Options under the Plan no later than the
date of the event creating the tax liability. In the Committee's discretion,
such tax obligations may be paid in whole or in part in shares of Stock,
including shares retained from the exercise of the Option creating the tax
obligation, valued at the fair market value of the Stock on the date of delivery
to the Company as determined in good faith by the Committee. The Company and
any parent corporation or subsidiary corporation of the Company (as defined in
Sections 424(e) and (f), respectively, of the Code) may, to the extent permitted
by law, deduct any such tax
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obligations from any payment of any kind otherwise due to the optionee.
(e) Amendment of Options. The Committee may amend, modify or
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terminate any outstanding Option, including substituting therefor another Option
of the same or different type, changing the date of exercise or realization and
converting an Incentive Stock Option to a Nonstatutory Stock Option, provided
that the optionee's consent to such action shall be required unless the
Committee determines that the action, taking into account any related action,
would not materially and adversely affect the optionee.
7. Non-transferability.
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Generally, an Option shall not be transferable, except by will or by the
laws of descent and distribution, or, in the case of Nonstatutory Stock Options,
to the extent consistent with qualifying for the exemption provided by Rule 16B-
3 under the Exchange Act, pursuant to a qualified domestic relations order, and
the Options shall be exercisable, during the holder's lifetime, only by him or
her or such permitted transferee.
8. No Right to Employment.
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No persons shall have any claim or right to be granted an Option, and the
grant of an Option shall not be construed as giving an optionee the right to
continued employment. The Company expressly reserves the right at any time to
dismiss an optionee free from any liability or claim under the Plan, except as
specifically provided in the applicable Option.
9. No Rights as a Shareholder.
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Subject to the provisions of the applicable Option, no optionee or any
person claiming through an optionee shall have any rights as a shareholder with
respect to any shares of Stock to be distributed under the Plan until he or she
becomes the holder thereof.
10. Amendment or Termination.
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The Board may amend or terminate the Plan at any time, provided that no
amendment shall be made without stockholder approval if such approval is
necessary to comply with any applicable tax or regulatory requirement, including
any requirement for exemptive relief under Section 16(b) of the Exchange Act or
Section 162(m) of the Code, if compliance is so intended by the Committee.
11. Stockholder Approval.
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The Plan is subject to approval by the stockholders of the Company by the
affirmative vote of the holders of a majority of
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the shares of capital stock of the Company entitled to vote thereon and present
or represented at a meeting duly held in accordance with the laws of the State
of Delaware, or by any other action that would be given the same effect under
the laws of such jurisdiction, which action in either case shall be taken within
twelve (12) months from the date the Plan was adopted by the Board. In the event
such approval is not obtained, all Options granted under the Plan shall be void
and without effect.
12. Governing Law.
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The provisions of the Plan shall be governed by and interpreted in
accordance with the laws of the State of Delaware, without reference to the
provisions of conflicts of law thereunder.
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