Agreement Concerning Stock Options
Exhibit
10.4
This
Agreement Concerning Stock Options (“Agreement”) is made and executed as of the
____ day of ______________, 2008, by and between ____________, an
individual (the “Option Holder”) and 1st
Independence Financial Group, Inc., a Delaware corporation (the
“Company”).
WITNESSETH:
WHEREAS,
the Company has adopted the 2004 Omnibus Stock Option Plan (the “Plan”);
and
WHEREAS,
pursuant to the Plan, the Option Holder has been granted the right to purchase
______ shares of
1st
Independence Common Stock for an exercise price of $______ per share (the
“Options”); and
WHEREAS,
the Company has entered into an Agreement and Plan of Merger, dated as of
February 26, 2008, with MainSource Financial Group, Inc., an Indiana corporation
(“MainSource”) and 1st
Independence Bank, Inc. (the “Merger Agreement”), pursuant to which, among other
things: (i) the Company will merge with and into MainSource (the
“Merger”); (ii) MainSource will, for each 1st
Independence Stock Option outstanding at the Effective Time of the Merger, pay
cash equal to the amount determined pursuant to Section 2.01(b) of the Merger
Agreement; and (iii) the Company has agreed to use its best efforts to obtain a
written consent from each holder of a 1st
Independence Stock Option agreeing to the disposition of such option in
accordance with the provisions of Section 2.01 of the Merger Agreement
(unless such holder exercises said option prior to the Effective Time in
accordance with the terms thereof) and to accept the consideration provided for
in the Merger Agreement, if any, in exchange for the termination of such stock
options; and
NOW
THEREFORE, in consideration of the recitals and representations contained herein
and other good and valuable consideration the receipt of which is hereby
acknowledged, the parties enter into this agreement as of the date first written
above and agree as follows:
AGREEMENT
1. Capitalized
terms used in this Agreement shall have the meanings set forth in the Merger
Agreement unless otherwise expressly defined herein.
2. Pursuant
to Section 2.01(b) of the Merger Agreement, as of the Effective Time, the
Options for _________ shares of
1st
Independence Common Stock are to be converted into the right to receive a cash
payment in an amount equal to the product of (A) the sum of (i) (x) $5.475,
subject to adjustment as provided in Section 2.02 of the Merger Agreement, plus
(y) the product of the Average Share Price of MainSource Common Stock (as
defined below) multiplied by 0.881036 (which Exchange Ratio may be adjusted as
provided in the Merger Agreement), less (ii) the per share exercise price for
each share of 1st Independence Common Stock subject to such Options, multiplied
by (B) the number of shares of 1st Independence Common Stock
subject
to such Options; provided, however, that the payer or its successor may withhold
from such cash payment those taxes required to be withheld by applicable law, if
any. Upon the receipt of such payment, if any, the Options shall
terminate and be without further force and effect as of the Effective
Time. The Average Share Price of MainSource Common Stock shall be
equal to the average per share closing prices of a share of MainSource Common
Stock as quoted on the Nasdaq Stock Market during the ten trading days preceding
the fifth (5th) calendar day preceding the Effective Time.
3. If the
calculation of the payment due with respect to the Options described in Section
2 above results in a negative number, then the Option Holder agrees the Options
shall still terminate and be without further force and effect as of the
Effective Time, notwithstanding the fact that no payment will be made with
respect thereto pursuant to Section 2 above. The Option Holder
acknowledges that MainSource and the Company are relying on the Option Holder’s
agreement to the foregoing in connection with the transactions contemplated in
the Merger Agreement and such reliance constitutes adequate consideration for
the termination of the Options.
4. The
Option Holder consents to the actions to be taken with respect to the Options as
described above. Should the Option Holder desire to exercise any
Options prior to the Effective Time, the Option Holder must do so in accordance
with the terms and conditions of the Options and the Plan and such exercise must
occur no later than the fifth business day prior to the Effective Time of the
Merger. Any exercise of the Options shall correspondingly reduce the
number of shares subject to the Options and the cash payment, less applicable
withholdings, to otherwise be paid the Option Holder under Section 2 above, if
any.
5. This
Agreement constitutes the entire understanding between the Company and the
Option Holder relating to the Options and their disposition in the Merger and
supersedes any matters to the contrary that may be contained in the Plan or any
other agreement or document relating to the Options. However, this
Agreement does not otherwise supersede the terms and conditions of the Merger
Agreement, which shall otherwise be controlling.
6. No
amendment or additions to this Agreement shall be binding unless made in writing
and signed by both parties hereto.
7. If for
any reason the Merger is not consummated, this Agreement shall be null and void
and of no force or effect.
8. This
Agreement shall be governed by the laws of the State of Indiana.
[signature
page follows]
IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the day and
year first written above.
“Company”
1ST
INDEPENDENCE FINANCIAL GROUP, INC.
By:______________________________
N.
Xxxxxxx Xxxxx, President and CEO
“Option
Holder”
______________________________________
Signature
______________________________________
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