EXHIBIT 99A
QNB CORP. STOCK INCENTIVE PLAN
QNB CORP.
STOCK INCENTIVE PLAN
1. Purpose.
The purpose of the QNB Corp. Stock Incentive Plan (the
"Plan") is to further the earnings of QNB Corp., its subsidiaries
and other affiliates (the "Company"). The Plan provides for the
award of long-term incentives to those officers and other key
executives who make substantial contributions to the Company by
their loyalty, industry, and invention. The Company intends that
the Plan will facilitate securing, retaining, and motivating
management employees of high caliber and potential.
2. Administration.
The Plan shall be administered by a Committee (the
"Committee") of the Board of Directors of QNB Corp. (the
"Board"). The Committee shall consist of three or more persons
selected by the Board of Directors who are ineligible and who
have been ineligible for a one year period prior to appointment
thereto for selection as a person to whom stock options may be
granted pursuant to this Plan or any other similar plan of the
Company. Without limiting the foregoing, the Committee shall
have full and final authority in its discretion to interpret the
provisions of the Plan and to decide all questions of fact
arising in its application; to determine the employees to whom
awards shall be made under the Plan; to determine the type of
awards to be made and the amount, size and terms of each such
award; to determine the time when awards shall be granted; and to
make all other determinations necessary or advisable for the
administration of the Plan.
3. Stock Subject to the Plan.
The shares that may be issued under the Plan shall not
exceed in the aggregate eighty two thousand (82,000) shares of
common stock of the Company. Such shares may be authorized and
unissued shares or treasury shares. Except as otherwise provided
herein, any shares subject to an option or right which for any
reason expires or is terminated unexercised as to such shares
shall again be available under the Plan.
4. Eligibility to Receive Awards.
Persons eligible to receive awards under the Plan shall
be limited to those full-time officers and other key executive
employees of the Company who are in positions in which their
decisions, actions and counsel will have a significant impact
upon the profitability and success of the Company. Directors of
the Company who are not otherwise full-time officers or employees
of the Company shall not be eligible to participate in the Plan.
5. Form of Awards.
Awards may be made from time to time by the Committee
in the form of stock options to purchase shares of common stock
of the Company. Stock options may be options which are intended
to qualify as incentive stock options within the meaning of
Section 422A of the Internal Revenue Code of 1986, or any
amendment or substitute thereto ("Incentive Stock Options") or
options which are not intended to so qualify ("Non-qualified
Stock Options").
6. Stock Options.
Stock options for the purchase of common stock of the
Company shall be evidenced by written agreements in such form not
inconsistent with the Plan as the Committee shall approve from
time to time, which shall contain in substance the following
terms and conditions:
(a) Type of Option.
Each option agreement shall identify the options
represented thereby as Incentive Stock Options or Non-Qualified
Stock Options, as the case may be.
(b) Option Price.
The purchase price of stock subject to an option
shall be the fair market value at the time of grant, as
determined by the Committee.
(c) Exercise Term.
Each option agreement shall state the period or
periods of time within which the option may be exercised, in
whole or in part, which shall be such period or periods of time
as may be determined by the Committee, provided that no option
shall be exercisable after five (5) years from the date of grant
thereof. The Committee may, in its discretion, provide in the
option agreement circumstances under which the option shall
become immediately exercisable, and may, notwithstanding the
foregoing, accelerate the exercisability of any option at any
time.
(d) Payment for Shares.
The purchase price of the shares with respect to
which an option is exercised shall be payable in full at the time
of exercise in cash, common stock of the Company at fair market
value, or a combination thereof, as the Committee may determine
and subject to such terms and conditions prescribed by the
Committee for such purpose.
(e) Rights Upon Termination of Employment.
In the event that an optionee ceases to be an
employee of the Company for any cause other than death or
disability, the options shall terminate at the time of
termination. In the event that an optionee dies or becomes
disabled prior to the expiration of his option and without having
fully exercised his option, the optionee or his successor shall
have the right to exercise the option during its term within a
period of six months after termination of employment due to death
or disability to the extent that the option was exercisable at
the time of termination, or within such other period, and subject
to such terms and conditions, as may be specified by the
Committee.
(f) Nontransferability.
Each option agreement shall state that the option
is not transferable other than by will or the laws of descent and
distribution, and that during the lifetime of the optionee the
option is exercisable only by him.
(g) Incentive Stock Option.
In the case of an Incentive Stock Option, each
option agreement shall contain such other terms, conditions and
provisions as the Board determines necessary or desirable in
order to qualify such option as a tax favored option (within the
meaning of Section 422A of the Code, or any amendment or
substitute thereto or regulation thereunder) including without
limitation, the following:
(i) The purchase price of stock subject to an
Incentive Stock Option shall not be less than 100% of the fair
market value of such stock on the date the option is granted as,
determined by the Committee;
(ii) The aggregate fair market value (determined
as of the time the option is granted) of the stock with respect
to which Incentive Stock Options are exercisable for the first
time by any employee during any calendar year (under all plans of
the Company) shall not exceed $100,000; and
(iii) No Incentive Stock Option shall be granted
to any employee if at the time the option is granted the
individual owns
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stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company or its parent or
subsidiary corporation unless at the time such option is granted
the option price is at least 110% of the fair market value of the
stock subject to the option and such option by its terms is not
exercisable after the expiration of five years from the date of
grant.
7. General Restrictions.
Each award under the Plan shall be subject to the
requirement that if at any time the Committee shall determine
that (i) the listing, registration or qualification of the shares
of common stock subject or related thereto upon any securities
exchange or under any state or federal law, or (ii) the consent
or approval of any government regulatory body, or (iii) an
agreement by the recipient of an award with respect to the
disposition of shares of common stock is necessary or desirable
as a condition of or in connection with the granting of such
award or the issuance or purchase of shares of common stock
thereunder, such award shall not be consummated in whole or in
part unless such listing, registration, qualification, consent,
approval or agreement shall have been effected or obtained free
of any conditions not acceptable to the Committee.
8. Single or Multiple Agreements.
Multiple forms of awards or combinations thereof may be
evidenced by a single agreement or multiple agreements, as
determined by the Committee.
9. Rights of a Shareholder.
The recipient of any award under the Plan, unless
otherwise provided by the Plan, shall have no rights as a
shareholder with respect thereto unless and until certificates
for shares of common stock are issued to him.
10. Right to Terminate Employment.
Nothing in the Plan or in any agreement entered into
pursuant to the Plan shall confer upon any participant the right
to continue in the employment of the Company or affect any right
which the Company may have to terminate the employment of such
participant.
11. Withholding.
Whenever the Company proposes or is required to issue
or transfer shares of common stock under the Plan, the Company
shall have the right to require the recipient to remit to the
Company an amount sufficient to satisfy any federal, state or
local withholding tax requirements prior to the delivery of any
certificate or certificates for such shares.
12. Non-Assignability.
No award under the Plan shall be assignable or
transferable by the recipient thereof except by will or by the
laws of descent and distribution or by such other means as the
Committee may approve. During the life of the recipient, such
award shall be exercisable only by such person or by such
person's guardian or legal representative.
13. Non-Uniform Determinations.
The Committee's determination under the Plan (including
without limitation determinations of the persons to receive
awards, the form, amount and timing of such awards, the terms and
provisions of such awards and the agreements evidencing same, and
the establishment of values) need not be uniform and may be made
selectively among persons who receive, or are eligible to
receive, awards under the Plan, whether or not such persons are
similarly situated.
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14. Adjustments.
In the event of any change in the outstanding stock of
the Company, by reason of a stock dividend or distribution,
recapitalization, merger, consolidation, split-up, combination,
exchange of shares or the like, the Committee may, in its
discretion, adjust the number of shares of common stock which may
be issued under the Plan. In such event the Committee may make
any changes it deems equitable (subject to approval of the Board
of Directors, if necessary) in outstanding stock options, stock
appreciation rights, and restricted stock awards.
15. Amendment.
The Committee may terminate or amend the Plan at any
time, except without shareholder approval, the Committee may not
increase the maximum number of shares which may be issued under
the Plan (other than increases pursuant to paragraph 14 hereof),
extend the period during which any award may be exercised, extend
the term of the Plan or change the minimum option price. The
termination or any modification or amendment of the Plan shall
not, without the consent of a participant, affect his rights
under an award previously granted.
16. Effect on Other Plans.
Participation in this Plan shall not affect an
employee's eligibility to participate in any other benefit or
incentive plan of the Company. Any awards made pursuant to this
Plan shall not be used in determining the benefits provided under
any other plan of the Company unless specifically provided.
17. Duration of the Plan.
The Plan shall remain in effect until all awards under
the Plan have been satisfied by the issuance of shares, but no
award shall be granted more than ten years after the earlier of
the date the Plan is adopted by the Company or is approved by the
Company's shareholders.
Adopted February 23, 1988
by the Board of Directors
of QNB Corp. Shareholders
approved Plan April 19, 1988.
Amended March 14, 1995
by the Board of Directors
of QNB Corp. to increase the
number of shares covered by
the Plan to 82,000. Shareholders
approved the amendment on
May 9, 1995.
Amended December 19, 1995
by the Board of Directors
of QNB Corp. to delete
Original Section 6 (h)
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Right of First Refusal.
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Shareholders approval not
required.
/s/ Edgar L. Stauffer
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Edgar L. Stauffer
Compensation Committee Chairman
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