COVEST BANCSHARES, INC.
1992 STOCK OPTION AND INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
This Option was granted on January 20, 1999 by CoVest Bancshares, Inc. (the
"Corporation"), to Xxxxx X. Xxxxxxx (the "Optionee"), in accordance with the
following terms and conditions:
1. OPTION GRANT AND EXERCISE PERIOD. The Corporation has granted to the
Optionee an Option (the "Option") to purchase, pursuant to the 1992 Stock Option
and Incentive Plan (the "Plan") and this Agreement, an aggregate of 69,232
shares (the "Option Shares") of the common stock of the Corporation, par value
$.01 per share ("Common Stock"), at the price of $13.00 per share (the "Exercise
Price"). This Option is not an incentive stock option within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended. A copy of the
Plan, as currently in effect, is incorporated by reference and is attached to
this Agreement.
This Option shall be exercisable only during the period (the "Exercise
Period") commencing on January 20, 1999 (the "Commencement Date"), and ending
at 5:00 p.m., Des Plaines, Illinois time, on the date ten years after the
Commencement Date, such later time and date being referred to as the "Expiration
Date." During the Exercise Period, this Option shall be exercisable, in whole or
in part, from time to time, in accordance with the following schedule and
subject to the provisions of this Agreement.
NUMBER OF SHARES
DATE EXERCISABLE
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January 20, 1999 17,308
January 20, 2000 17,308
January 20, 2001 17,308
January 20, 2002 17,308
2. METHOD OF EXERCISE OF THIS OPTION. This Option may be exercised
during the Exercise Period by giving written notice to the Corporation
specifying the number of Option Shares to be purchased. The notice must be in
the form prescribed by the committee referred to in Section 3 of the Plan or its
successor (the "Committee") and directed to the address set forth in Section 11
below. The date of exercise is the date on which such notice is received by the
Corporation. Such notice must be accompanied by payment in full of the Exercise
Price for the Option Shares to be purchased upon such exercise. Payment shall
be made either: (i) in cash, which may
be in the form of a check, bank draft, or money order payable to the
Corporation; or (ii) if the Committee shall have previously approved such
form of payment, by delivering shares of Common Stock already owned by the
Optionee having a "Market Value" (as defined in the Plan as in effect on the
date of the grant of this Option) equal to the applicable exercise price; or
(iii) if the Committee shall have previously approved such form of payment, a
combination of cash and such shares. Promptly after such payment, subject to
Section 3 below, the Corporation shall issue and deliver to the Optionee, or
other person exercising this Option, a certificate or certificates representing
the shares of Common Stock so purchased, registered in the name of the Optionee
(or such other person), or, upon request, in the name of the Optionee (or such
other person) and in the name of another jointly with right of survivorship.
3. DELIVERY AND REGISTRATION OF SHARES OF COMMON STOCK. The
Corporation's obligation to deliver shares of Common Stock hereunder shall, if
the Committee so requests, be conditioned upon the receipt of a representation
as to the investment intention of the Optionee, or any other person, to whom
such shares are to be delivered, in such form as the Committee shall determine
to be necessary or advisable to comply with the provisions of the Securities Act
of 1933, as amended, or any other federal, state or local securities law or
regulation. In requesting any such representation, it may be provided that such
representation requirement shall become inoperative upon a registration of such
shares or other action eliminating the necessity of such representation under
such Securities Act or other securities law or regulation. The Corporation
shall not be required to deliver any shares upon exercise of this Option prior
to (i) the admission of such shares to listing on any stock exchange or system
on which the shares of Common Stock may then be listed, and (ii) the completion
of such registration or other qualification of such shares under any state or
federal law, rule or regulation, as the Committee shall determine to be
necessary or advisable.
4. NON-TRANSFERABILITY OF THIS OPTION. This Option may not be assigned,
encumbered, or transferred except, in the event of the death of the Optionee, by
will or the laws of descent and distribution to the extent provided in Section 5
below. Except as provided herein, this Option is exercisable during the
Optionee's lifetime only by the Optionee. The provisions of this Option shall
be binding upon, inure to the benefit of and be enforceable by the parties
hereto, the successors and assigns of the Corporation and any person to whom
this Option is transferred by will or by the laws of descent and distribution or
pursuant to a qualified domestic relations order, as described in the Plan.
5. TERMINATION OF SERVICE OR DEATH OF THE OPTIONEE. Except as provided
in the second or third paragraphs of this Section 5 and notwithstanding any
other provision of this Option to the contrary, this Option shall not be
exercisable unless the Optionee, at the time he exercises this Option, has
maintained "Continuous Service" (as
defined in the Plan as in effect on the date of the grant of this Option) since
the date of the grant of this Option.
If the Optionee shall cease to maintain Continuous Service because of total
or partial disability, or because of retirement, the Optionee may, but only
within the period of three months immediately succeeding such cessation of
Continuous Service and in no event after the Expiration Date, exercise this
Option to the extent the Optionee was entitled to exercise this Option at the
date of cessation. Notwithstanding the foregoing, if the Optionee shall cease
to maintain Continuous Service due to normal retirement, and the Optionee has
served the Corporation or CoVest Banc, National Association for at least ten
years, the Optionee may, but only during the period of five years immediately
succeeding such cessation of Continuous Service and in no event after the
expiration of this Option, exercise such Option. If the Optionee is terminated
for cause, all rights under this Option shall expire immediately upon the giving
to the Optionee of notice of such termination.
In the event of the death of the Optionee while in Continuous Service of
the Corporation or during the three month and five year periods referred to in
the immediately preceding paragraph, the person to whom the Option has been
transferred by will or by the laws of descent and distribution may, but only to
the extent the Optionee was entitled to exercise this Option immediately prior
to his death, exercise this Option at any time within one year following the
death of the Optionee, but in no event later than ten years from the date of the
grant of this Option. Following the death of the Optionee, the Committee may,
as an alternative means of settlement of this Option, elect to pay to the person
to whom this Option is transferred by will or by the laws of descent and
distribution the amount by which the Market Value (as defined in the Plan) per
share of Common Stock on the date of exercise of this Option shall exceed the
Exercise Price per Option Share, multiplied by the number of Option Shares with
respect to which this Option is properly exercised. Any such settlement of this
Option shall be considered an exercise of this Option for all purposes of this
Option and of the Plan.
6. ADJUSTMENTS FOR CHANGES IN CAPITALIZATION OF THE CORPORATION. In the
event of any change in the outstanding shares of Common Stock by reason of any
reorganization, recapitalization, stock split, stock dividend, combination or
exchange of shares, merger, consolidation, or any change in the corporate
structure of the Corporation or in the shares of Common Stock, the number and
class of shares covered by this Option and the Exercise Price shall be
appropriately adjusted by the Committee, whose determination shall be
conclusive.
7. EFFECT OF MERGER. In the event of any merger, consolidation or
combination of the Corporation with or into another corporation (other than a
merger, consolidation, or combination in which the Corporation is the continuing
corporation and which does not result in the outstanding shares of Common Stock
being converted into or exchanged for different securities, cash or other
property, or any combination thereof), the Optionee shall have the right
(subject to the provisions of the Plan and the
limitations contained herein) thereafter and during the Exercise Period, to
receive upon exercise of this Option an amount equal to the excess of the
fair market value on the date of such exercise of the securities, cash or
other property, or combination thereof, receivable upon such merger,
consolidation or combination in respect of a share of Common Stock over the
Exercise Price, multiplied by the number of Option Shares with respect to
which this Option shall have been exercised. Such amount may be payable
fully in cash, fully in one or more of the kind or kinds of property payable
in such merger, consolidation or combination, or partly in cash and partly in
one or more of such kind or kinds of property, all in the discretion of the
Committee.
8. EFFECT OF CHANGE IN CONTROL. If a tender offer or exchange offer for
shares of Common Stock (other than such an offer by the Corporation) is
commenced, or if the stockholders of the Corporation shall approve an agreement
providing either for a transaction in which the Corporation will cease to be an
independent publicly owned entity or for a sale or other disposition of all or
substantially all the assets of the Corporation, this Option shall (to the
extent it is not then exercisable) become exercisable in full upon the happening
of such event and shall remain so exercisable for a period of sixty days
following such date after which this Option shall revert to being exercisable in
accordance with the other provisions of this Option.
9. STOCKHOLDER RIGHTS NOT GRANTED BY THIS OPTION. The Optionee is not
entitled by virtue hereof to any rights of a stockholder of the Corporation or
to notice of meetings of stockholders or to notice of any other proceedings of
the Corporation.
10. WITHHOLDING TAX. Where the Optionee or another person is entitled to
receive Option Shares pursuant to the exercise of this Option, the Corporation
shall have the right to require the Optionee or such other person to pay to the
Corporation the amount of any taxes which the Corporation or any of its
Affiliates is required to withhold with respect to such Option Shares, or, in
lieu thereof, to retain, or sell without notice, a sufficient number of such
shares to cover the amount required to be withheld or in lieu of any of the
foregoing, to withhold a sufficient sum from the Optionee's compensation payable
by the Corporation to satisfy the Corporation's tax withholding requirements.
The Corporation's method of satisfying its withholding obligations shall be
solely in the discretion of the Corporation, subject to applicable federal,
state and local law.
11. NOTICES. All notices hereunder to the Corporation shall be delivered
or mailed to it addressed to the Secretary of CoVest Bancshares, Inc., 000 Xxx
Xxxxxx, Xxx Xxxxxxx, Xxxxxxxx 00000-0000. Any notices hereunder to the Optionee
shall be delivered personally or mailed to the Optionee's address noted below.
Such addresses for the service of notices may be changed at any time provided
written notice of the change is furnished in advance to the Corporation or to
the Optionee, as the case may be.
12. PLAN AND PLAN INTERPRETATIONS AS CONTROLLING. This Option and the
terms
and conditions herein set forth are subject in all respects to the terms
and conditions of the Plan, which are controlling. All determinations and
interpretations of the Committee shall be binding and conclusive upon the
Optionee or his legal representatives with regard to any question arising under
this Agreement or under the Plan.
13. OPTIONEE SERVICE. Nothing in this Option shall limit the right of the
Corporation or any of its Affiliates to terminate the Optionee's service as a
director, officer or employee, or otherwise impose upon the Corporation or any
of its Affiliates any obligation to employ or accept the services of the
Optionee.
14. OPTIONEE ACCEPTANCE. The Optionee shall signify his acceptance of the
terms and conditions of this Option by signing in the space provided below and
returning a signed copy of this Agreement to the Corporation at the address set
forth in Section 11 above.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
COVEST BANCSHARES, INC.
By:
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Chairman of the Board
ACCEPTED:
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Xxxxx X. Xxxxxxx
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(Street Address)
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(City, State and ZIP Code)
