INDEPENDENT BANK CORP. STOCK OPTION AGREEMENT FOR NON-EMPLOYEE DIRECTOR Notification and Acceptance of Stock Option
Exhibit 10.16
Notification and Acceptance of Stock Option
The Independent Bank Corp. 2006 Non-Employee Director Stock Plan (the “Plan”) permits the
granting of Stock Options to directors who are not also employees of Independent Bank Corp. (the
“Company”). The Company is pleased to grant you the following Stock Option in accordance with the
Plan:
Effective Date of Stock Option
Agreement
|
April 18, 2006 | |
Non-Employee Director Name and
Residential Address:
|
«Name___Address» | |
Number of shares of common stock that
may be purchased under this Stock
Option:
|
5,000 shares of the Company’s common stock, unless adjusted in accordance with the Option Agreement. | |
Type of Stock Option
|
Non-Qualified Stock Option | |
Purchase Price
|
$32.23 per share | |
Term
|
Seven years from date of grant, unless earlier terminated in accordance with this Option Agreement. | |
Vesting Schedule
|
One-third of the Options are immediately vested and fully exercisable, one-third of the Options shall be vested and fully exercisable on January 2, 2007 and one-third of the Options shall be vested and fully exercisable on January 2, 2008, unless earlier accelerated in accordance with this Option Agreement. |
This Stock Option is subject to the terms and conditions of the Stock Option Agreement set forth
below (the “Agreement”). By signing you both accept this Stock Option and acknowledge that you
have read, understand, and accept the terms and conditions of the Agreement set forth below.
Signed as a Massachusetts instrument under seal as of the Effective Date:
| NON-EMPLOYEE DIRECTOR | ||||
| President and Chief Executive Officer | ||||
The Company agrees to grant to the non-employee director named above (the “Non-Employee
Director”) the right and option (the “Option”) to purchase all or any part of the number of shares
of its common stock, $.01 par value (hereinafter called the “Common Stock”) for the price and
during the period set forth above, subject to the terms and conditions of the Plan and this
Agreement, as follows:
Section 1. Investment Purpose. The Non-Employee Director agrees and
acknowledges that this Option has been acquired for the purpose of investment and not with a view
to or for sale in connection with any distribution thereof.
Section 2. Payment of Purchase Price.
(a) Method of Payment. Payment of the purchase price for shares purchased upon
exercise of this Option shall be made (i) by delivery to the Company of cash or check to the order
of the Company in an amount equal to the purchase price of shares, (ii) by delivery to the Company
of shares of Common Stock already owned by the Non-Employee Director having a fair market value as
of the date of exercise equal to the aggregate purchase price of the shares as to which this Option
shall be exercised, or (iii) any combination of such methods of payment.
(b) Valuation of Shares Tendered in Payment of Purchase Price. For purposes hereof,
the fair market value of any shares of Common Stock which may be delivered to the Company in
exercise of this Option shall be determined in accordance with the terms of the Plan.
(c) Delivery of Shares Tendered in Payment of Purchase Price. If the Non-Employee
Director exercises this Option by delivery of shares of Common Stock, the certificate or
certificates representing the shares of Common Stock to be delivered shall be duly executed for
transfer in blank by the Non-Employee Director or shall be accompanied by a stock power duly
executed in blank suitable for purposes of transferring such shares to the Company. Fractional
shares of Common Stock or a written authorization which would result in the issuance of fractional
shares of Common Stock will not be accepted in payment of the purchase price of shares acquired
upon exercise of this Option.
(d) Restrictions on Use of Common Stock. Notwithstanding anything to the contrary
contained in this Agreement, no shares of Common Stock may be tendered in payment of the purchase
price of shares purchased upon exercise of this Option if the shares so tendered were acquired
within six months prior to the date of such tender (for purposes hereof, shares of Common Stock
shall be deemed to have been held by an Non-Employee Director for six months if such shares were
issued to such Non-Employee Director upon exercise of an Option granted to the Non-Employee
Director by the Company and the period from the date of the grant of the Option pursuant to which
such shares were acquired until the delivery date of such shares of Common Stock pursuant hereto is
at least six months).
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Section 3. Non-transferability. Notwithstanding anything contained in the
Plan to the contrary, the Option shall not be transferable otherwise than (i) pursuant to a
qualified domestic relations order (as such term is defined in Rule 16b-3), (ii) by will or the laws of
intestacy or (iii) to any member of the Non-Employee Director’s Family (as such term is defined in
the Plan), and the Option may be exercised, during the lifetime of the Non-Employee Director, only
by him/her. More particularly (but without limiting the generality of the foregoing), the Option
may not be assigned, transferred (except as provided above), pledged, or hypothecated in any way,
shall not be assignable by operation of law and shall not be subject to execution, attachment, or
similar process. Any attempted assignment, transfer, pledge, hypothecation, or other disposition
of the Option contrary to the provisions hereof, and the levy of any execution, attachment or
similar process upon the Option shall be null and void and without effect.
Section 4. Termination of Non-Employee Director Status.
(a) General. If the Non-Employee Director ceases to be a director of the Company or
Rockland Trust Company (“Rockland”) for any reason other than removal from the Board for cause, any
outstanding Option shall be exercisable by the Non-Employee Director (whether or not exercisable by
the Non-Employee Director immediately prior to ceasing to be a director of the Company or Rockland)
at any time prior to the expiration date of the Option or within three years after the date the
Non-Employee Director ceases to be a director of the Company or Rockland, whichever is the shorter
period. Following the death or permanent and total disability (as such term is defined in Section
22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”) or any successor thereto) of
the Non-Employee Director during service as a director of the Company or Rockland, any outstanding
Option held by the Non-Employee Director at the time of death or permanent and total disability
(whether or not exercisable by the Non-Employee Director immediately prior to death or permanent
and total disability) shall be exercisable by the person entitled to do so under the Non-Employee
Director’s will or, if the Non-Employee Director shall fail to make testamentary disposition of the
Option, shall die intestate or shall become permanently and totally disabled, by the Non-Employee
Director’s legal representative at any time prior to the expiration date of the Option or within
three years after the Non-Employee Director’s death or permanent and total disability, whichever is
the shorter period.
(b) Removal for Cause. If during the Non-Employee Director’s term of office as a
director of the Company or Rockland the Non-Employee Director is removed from the Board for cause,
any outstanding Option held by the Non-Employee Director which is not exercisable by the
Non-Employee Director immediately prior to such removal shall terminate as of the date of such
removal, and any outstanding Option held by the Non-Employee Director which is exercisable by the
Non-Employee Director immediately prior to such removal shall be exercisable at any time prior to
the expiration date of the Option or within three months after the date of such removal, whichever
is the shorter period. If the Non-Employee Director dies or becomes permanently and totally
disabled, during the period when any outstanding Options remain exercisable after ceasing to be
director of the Company due to a removal for cause, any outstanding Option shall be exercisable by
the person entitled to do so under the will of the Non-Employee Director or, if the Non-Employee
Director shall fail to make testamentary disposition
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of the Option, shall die intestate or shall
become permanently and totally disabled, by the Non-Employee Director’s legal representative at any
time prior to the expiration date of the Option or
within one year after the Non-Employee Director’s date of death or permanent and total disability,
whichever is the shorter period.
Section 5. Change of Control.
(a) In the event of a “Change of Control” or a liquidation of the Company, Options shall
immediately vest and shall become fully exercisable and shall remain exercisable for a period of
three (3) months after such Change of Control.
(b) A “Change of Control” shall be deemed to have occurred if (i) any “person” (as such term
is defined in Section 13(d) of the Securities Exchange Act of 1934, as amended) is or becomes the
beneficial owner, directly or indirectly, of either (x) a majority of the outstanding Common Stock
or the common stock of Rockland, or (y) securities of either the Company or Rockland representing a
majority of the combined voting power of the then outstanding voting securities of either the
Company or Rockland, respectively; or (ii) the Company or Rockland consolidates or merges with any
other person or sells all or substantially all of its assets to a person not at such time owning a
majority of the outstanding Common Stock or (iii) individuals who currently constitute the Board
cease for any reason to constitute a majority of the Board, unless the election of each new
director was nominated or approved by the shareholders of the Company at their regularly scheduled
annual meeting or was approved by at least two thirds of the directors of the Board currently in
office.
Section 6. Adjustments. If, through or as a result of any merger,
consolidation, sale of all or substantially all of the assets of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock split or other
similar transaction, (i) the outstanding shares of Common Stock are increased, decreased or
exchanged for a different number or kind of shares or other securities of the Company, or (ii)
additional shares or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other securities, an
appropriate and proportionate adjustment may be made in (x) the maximum number and kind of shares
reserved for issuance under the Plan, (y) the number and kind of shares or other securities subject
to any then outstanding Options under the Plan, and (z) the price for each share subject to any
then outstanding Options under the Plan, without changing the aggregate purchase price as to which
such Options remain exercisable. Any adjustments or substitutions under this Section 6 shall be
made by the Board, whose determination as to such adjustments or substitutions, if any, shall be
final, binding and conclusive. No fractional shares will be issued under the Plan on account of
any such adjustments or substitutions.
Section 7. Method of Exercising Option. Subject to the terms and conditions
of this Agreement, the Option may be exercised by written notice to the Company, at 000 Xxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxxxxxxxx 00000. Such notice shall state the election to exercise the Option
and the number of shares in respect to which it is being exercised, and shall be signed by the
person or persons so exercising the Option. At that time, this Agreement shall be turned in to the
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Company for action by the Company to reduce the number of shares to which it applies. Such notice
shall either: (a) be accompanied by payment of the full purchase price of such shares, in which
event the Company shall deliver a certificate or certificates representing such shares as
soon as practicable after the notice shall be received or (b) fix a date (which shall be a business
day not less than five nor more than ten business days from the date such notice shall be received
by the Company) for the payment of the full purchase price of such shares against delivery of a
certificate or certificates representing such shares. Payment of such purchase price shall, in
either case, be made in the manner provided above. The certificate or certificates for the shares
as to which Option shall have been so exercised shall be registered in the name of the person or
persons so exercising the Option, (or, if the Option shall be exercised by the Non-Employee
Director and if the Non-Employee Director and another person jointly, with the right of
survivorship) and shall be delivered as provided above to or upon the written order of the person
or persons exercising the Option. In the event the Option shall be exercised, pursuant to this
Agreement, by any person or persons other than the Non-Employee Director, such notice shall be
accompanied by appropriate proof of the right of such person or persons to exercise the Option.
Section 8. General. The Company shall at all times during the term of the
Option reserve and keep available such number of shares of Common Stock as will be sufficient to
satisfy the requirements of this Agreement, shall pay all original issue taxes with respect to the
issue of shares pursuant hereto and all other fees and expenses necessarily incurred by the Company
in connection therewith, and will from time to time use its best efforts to comply with all laws
and regulations which, in the opinion of counsel for the Company, shall be applicable thereof.
Section 9. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Massachusetts.
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