Treatment of Stock Options 6 ARTICLE III.
Treatment of Company Stock Options (a) The Company promptly shall notify each holder of the Company Stock Options, in writing, of the Transactions in accordance with the Company Stock Plans (the “Option Holder Notice”). The Option Holder Notice shall (i) apprise the holders of outstanding Company Stock Options of their ability to exercise the Options in accordance with the Company Stock Plan prior to the Effective Time, (ii) disclose that, if not exercised, such Company Stock Options will terminate at the Effective Time and (iii) disclose that if any Company Stock Options are not exercised prior to the Effective Time or terminated as contemplated in clause (ii), the holders of such Company Stock Options will be entitled to receive the Option Merger Consideration in respect of such Company Stock Options. As of the Effective Time, each outstanding Company Stock Option shall be terminated by virtue of the Merger and each holder of a Company Stock Option shall cease to have any rights with respect thereto, other than the right to receive, in respect of each such terminated Company Stock Option, a single lump sum payment (without interest and subject to the deduction and withholding of such amounts as Parent, the Surviving Entity or the Exchange Agent, as applicable, is required to deduct and withhold with respect to the making of such payment under the Code, or any provision of state, local or foreign tax law) in cash an amount equal to the excess, if any, of (i) the Merger Consideration over (ii) the per share exercise price for such Company Stock Option (the “Option Merger Consideration”). Payment of the Option Merger Consideration to each of the holders of Company Stock Options entitled thereto shall be made as soon as practicable after the Effective Time, subject to the terms and conditions of this Agreement. Any amounts withheld and paid over to the appropriate taxing authority by Parent, the Surviving Entity or the Exchange Agent will be treated for all purposes of this Agreement as having been paid to the holder of the Company Stock Option in respect of whom such deduction and withholding was made. If the per share exercise price of any such Company Stock Option is equal to or greater than the Merger Consideration, such Company Stock Option shall be canceled with a cash payment of $0.001 per share being made in respect of each share of Company Common Stock subject to such Company Stock Option, for each Company Stock Option rounded to the next highest full cent. Prior to the Effective Time, the Company shall take all actions required by the Company Stock Plans under which such Company Stock Options were granted to cause such Company Stock Plans and all Company Stock Options granted thereunder to terminate at the Effective Time, including adopting any plan amendments and resolutions and obtaining any required Consents, without paying any consideration or incurring any debts or obligations on behalf of the Company or the Surviving Entity.
Treatment of Options (a) At the Effective Time of the Merger, each outstanding option to purchase Company Common Stock (a "Company Stock Option") issued pursuant to the Company's Non-Employee Directors' Stock Option Plan (the "Director Plan") or the Company's Stock Option and Restricted Stock Purchase Plan (the "Option Plan" and, collectively with the Director Plan, the "Company Stock Plans"), whether vested or unvested, shall be deemed to constitute an option to acquire, on the same terms and conditions as were applicable under such Company Stock Option, those shares of Parent Common Stock and CVPs which the holder of such Company Stock Option would have been entitled to receive pursuant to the Merger if such holder had exercised such option in full immediately prior to the Effective Time of the Merger (utilizing the Exchange Ratio as set forth in Section 2.01 of this Agreement), at a price per share equal to (y) the aggregate exercise price for the shares of Company Common Stock purchasable pursuant to such Company Stock Option divided by (z) the number of full shares of Parent Common Stock deemed purchasable pursuant to such Company Stock Option (a "Converted Option"); provided, however, that in the case of any option to which Section 421 of the Code applies by reason of its qualification under Section 422 of the Code ("incentive stock options"), the option price, the number of shares of Parent Common Stock purchasable pursuant to such option and the terms and conditions of exercise of such option shall be determined in order to comply with Section 424(a) of the Code. If the relevant Company Stock Option is not exercised prior to the Maturity Date (as defined in Exhibit A), any CVPs due pursuant thereto shall terminate and become null and void. If the relevant Company Stock Option is exercised, in whole or in part prior to the Maturity Date (as defined in Exhibit A), upon the sale of any shares of Parent Common Stock received upon the exercise of the relevant Company Stock Option, the CVPs due pursuant to such shares sold shall terminate and become null and void.
Incentive Stock Options If the Shares are held for more than twelve (12) months after the date of the transfer of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long term capital gain for federal and California income tax purposes. If Shares purchased under an ISO are disposed of within the applicable one (1) year or two (2) year period, any gain realized on such disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price.
Company Stock Options (i) Effective as of the Effective Time, each then outstanding option to purchase shares of Company Common Stock (each a “Company Stock Option”), pursuant to the Company’s equity-based compensation plans (the “Company Stock Plans”) and the award agreements evidencing the grants thereunder, granted prior to the date of this Agreement to any current or former employee or director of, consultant or other service provider to, the Company or any of its Subsidiaries shall immediately vest and become exercisable in accordance with the terms of the Company Stock Plans, shall be assumed by Parent and shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into an option to purchase a number of shares of Parent Common Stock (an “Assumed Stock Option”) equal to (i) the number of shares of Company Common Stock subject to such Company Stock Option immediately prior to the Effective Time multiplied by (ii) the Equity Award Exchange Ratio (rounded down to the nearest whole share); and the per share exercise price for Parent Common Stock issuable upon the exercise of such Assumed Stock Option shall be equal to (i) the exercise price per share of Company Common Stock at which such Company Stock Option was exercisable immediately prior to the Effective Time divided by (ii) the Equity Award Exchange Ratio (rounded up to the nearest whole cent), provided, however, that such conversion and assumption of the Assumed Stock Options shall comply with the regulations and other binding guidance under Section 409A of the Code. Except as otherwise provided herein, the Assumed Stock Options shall be subject to the same terms and conditions (including expiration date and exercise provisions after taking into account the accelerated vesting of the Company Stock Options as of the Effective Time as contemplated by the Company Stock Plans) as were applicable to the corresponding Company Stock Options immediately prior to the Effective Time.
Restricted Stock and Stock Options Employer shall cause the Compensation Committee of the Board of Directors of Employer to review whether Employee should be granted shares of restricted stock and/or options to purchase shares of common stock of CBSI. Such review may be conducted pursuant to the terms of the Community Bank System, Inc. 2014 Long-Term Incentive Plan, a successor plan, or independently, as the Compensation Committee shall determine. Reviews shall be conducted no less frequently than annually.
Treatment of Shares Section 2.1 Effect of the Merger on Capital Stock.............................2 Section 2.2 Exchange of Certificates..........................................6
Treatment of Company Options Prior to the Effective Time, the Board of Directors of the Company (or, if appropriate, any committee thereof) shall adopt appropriate resolutions and take all other actions necessary and appropriate to provide that, at the Effective Time, each unexpired and unexercised Company Option shall become fully vested and exercisable and shall be cancelled and, in exchange therefor, each former holder of any such cancelled Company Option shall be entitled to receive, in consideration of such cancellation, payments in cash (subject to any applicable withholding or other Taxes required by applicable Law to be withheld) equal to the product of (i) the total number of shares of Common Stock previously subject to such Company Option multiplied by (ii) the amount by which the Option In-The-Money Amount, calculated as of the Effective Time and recalculated, if applicable, in connection with any recalculation of the Common Merger Consideration, exceeds the exercise price of such Company Option (for the avoidance of doubt, without duplication of any amounts previously paid to holders of such Company Options in accordance herewith). Any such amount payable hereunder with respect to any Company Option shall be referred to as an “Option Payment”, and the aggregate of all such amounts payable hereunder shall be referred to as the “Option Payments”. At or prior to the Effective Time, Parent will make available to the Surviving Corporation the cash to be delivered in respect of the Option Payments based on the calculation of the Common Merger Consideration at the Effective Time (the “Closing Option Payments”). Option Payments following the Effective Time shall be made on or about the same dates, and subject to the same terms, as payments of the Merger Consideration to the holders of Company Capital Stock. Any Company Options shall no longer be exercisable by the former holder thereof, but shall only entitle such holder to the payment of the applicable Option Payments in accordance with this Section 2.6(d), which for the avoidance of doubt includes the right to receive payments in connection with any Excess Payment or any release of funds from the General Escrow Account or the Equityholders’ Representative Escrow Account. At the Effective Time, all Company Option Plans shall be terminated and no further Company Options shall be granted thereunder. The Company will use commercially reasonable efforts to cause each holder of Company Options to enter into a written agreement effectuating the foregoing, and the payment of the Option Payment to each holder of Company Options shall be subject to such holder’s execution and delivery of such agreement in the form attached hereto as Exhibit D (such agreement, an “Option Holder Letter”).
Stock and Stock Options Subject to vesting, as set forth on Exhibit B, the Company will issue to Director stock and options as set forth and described on Exhibit B. Company shall issue said stock and options within sixty (60) days from the execution of this Agreement by both parties.
Grant of Stock Options This non-qualified Stock Option is granted under and pursuant to the Plan and is subject to each and all of the provisions thereof.
