Common use of Stock Options to Be Granted Clause in Contracts

Stock Options to Be Granted. Section 4.1(b)(ii) of the Agreement also entitles the Executive to be awarded additional stock options based upon a specified percentage of additional shares that may be issued by the Bank during the Term of the Agreement. It is understood and agreed that such additional options are to be awarded contemporaneously with the issuance by the Bank of additional shares of its common stock for the primary purpose of increasing equity capital (whether for cash or in exchange for assets, such as for the acquisition of all or part of another business entity by merger, consolidation, share exchange or otherwise), and shall not be awarded in connection with shares issued by the Bank primarily for other purposes (for example, upon the exercise of stock options granted to employees or directors of the Bank in the nature of compensation or the exercise of warrants issued to organizing stockholders as reward for the organizers’ risk). Any such additional stock options to be awarded to the Executive shall be for an option price equal to the fair market value of the stock at the time of the transaction that gives entitlement to the award; shall vest one-third on each of the first three anniversaries of the date of the award; shall be exercisable within ten years from the date of the award; and otherwise shall be in the form of the stock option grant used for the options already deemed awarded on the Effective Date.