1
EXHIBIT 10.2 FORM OF RICHMOND COUNTY FINANCIAL CORP. STOCK OPTION ASSUMPTION
AGREEMENT FOR BAYONNE BANCSHARES, INC. 1998 STOCK-BASED INCENTIVE
PLAN
2
SAMPLE RICHMOND COUNTY FINANCIAL CORP.
STOCK OPTION ASSUMPTION AGREEMENT
OPTIONEE:_______________________
STOCK OPTION ASSUMPTION AGREEMENT issued as of the 22nd day of March,
1999, by Richmond County Financial Corp., a Delaware corporation ("Richmond").
WHEREAS, the undersigned individual ("Optionee") holds one or more
outstanding options to purchase shares of the common stock of Bayonne
Bancshares, Inc., a Delaware corporation ("Bayonne"), which were granted to
Optionee under the Bayonne 1998 Stock-Based Incentive Plan (the "Bayonne
Incentive Plan") and are evidenced by one or more Award Agreements or similar
documentation (the "Award Agreement(s)") between Bayonne and Optionee, which are
incorporated by reference herein.
WHEREAS, effective as of March 22, 1999, Bayonne has merged with and into
Richmond (the "Merger") pursuant to the Amended and Restated Agreement and Plan
of Merger (the "Merger Agreement"), dated as of October 14, 1998 by and between
Richmond and Bayonne;
WHEREAS, the Merger Agreement provides for the conversion of all
outstanding stock options under the Bayonne Incentive Plan into options to
purchase Richmond common stock ("Richmond Stock"), and to issue to the holder of
each outstanding option an agreement evidencing the conversion and assumption of
such option;
WHEREAS, pursuant to the provisions of the Merger Agreement, the exchange
ratio (the "Exchange Ratio") in effect for the Merger is 1.05 shares of Richmond
Stock for each outstanding share of Bayonne common stock ("Bayonne Stock");
WHEREAS, this Stock Option Assumption Agreement is to become effective
immediately in order to reflect certain adjustments to Optionee's outstanding
options under the Bayonne Incentive Plan, which have become necessary by reason
of the assumption of those options by Richmond in connection with the Merger.
NOW, THEREFORE, it is hereby agreed as follows:
1. The number of shares of Richmond Stock subject to the stock options
held by Optionee under the Bayonne Incentive Plan immediately prior to the
Effective Time (as defined in the Merger Agreement) of the Merger (the "Bayonne
Options") and the exercise price payable per share are set forth in Exhibit A
hereto. Richmond hereby assumes, as of the Effective Time, all the duties and
obligations of Bayonne under each of the Bayonne Options as set forth in the
Bayonne Incentive Plan and the Optionee's Award Agreement(s). In connection with
such assumption, the number of shares of Richmond Stock purchasable under each
Bayonne Option hereby assumed and the exercise price payable thereunder have
been adjusted to reflect the Exchange Ratio in a manner consistent with the
Merger Agreement. Accordingly, the number of shares of Richmond Stock subject to
each Bayonne Option hereby assumed shall be as specified for that option in
attached Exhibit A, and the adjusted exercise price payable per share of
Richmond Stock under the assumed Bayonne Option shall be as indicated for that
option in attached Exhibit A.
3
2. The following provisions shall govern each Bayonne Option hereby
assumed by Richmond:
(a) Unless the context otherwise requires, all references in each
Award Agreement and in the Bayonne Incentive Plan (as incorporated into
such Option Agreement) (i) to the "Holding Company" shall mean Richmond,
(ii) to "Common Stock" shall mean shares of Richmond Stock, (iii) to the
"Board of Directors" shall mean the Board of Directors of Richmond, (iv)
to the "Committee" shall mean the Personnel Committee of the Richmond
Board of Directors; and to the "Bank" shall mean Richmond County Savings
Bank.
(b) The grant date and the expiration date of each assumed Bayonne
Option and all other provisions which govern either the exercisability or
the termination of the assumed Bayonne Option shall remain the same as set
forth in the Award Agreement applicable to that option and the provisions
of the Bayonne Incentive Plan, and shall accordingly govern and control
Optionee's rights under this Stock Option Assumption Agreement to purchase
Richmond Stock.
(c) For purposes of applying any and all provisions of the Award
Agreement relating to Optionee's status as an employee, Optionee shall be
deemed to continue in such status for so long as Optionee renders services
as an employee of Richmond or any Richmond subsidiary (within the meaning
of a "subsidiary corporation" as defined in Section 424(f) of the Internal
Revenue Code of 1986, as amended). Accordingly, the provisions of the
Award Agreement governing the termination of the assumed Bayonne Options
upon Optionee's cessation of service as an employee of Bayonne shall
hereafter be applied on the basis of Optionee's cessation of employee
status with Richmond and its subsidiaries, and each assumed Bayonne Option
shall accordingly terminate, within the designated time period in effect
under the Award Agreement for that option, following such cessation of
service as an employee of Richmond and its subsidiaries.
(d) The adjusted exercise price payable for the Richmond Stock
subject to each assumed Bayonne Option shall be payable in any of the
forms authorized under the Bayonne Incentive Plan and the Award Agreement
applicable to that option.
(e) In order to exercise each assumed Bayonne Option, Optionee must
deliver to Richmond a written notice of exercise in which the number of
shares of Richmond Stock to be purchased thereunder must be indicated. The
exercise notice must be accompanied by payment of the adjusted exercise
price payable for the purchased shares of Richmond Stock and should be
delivered to Richmond at the following address:
Richmond County Financial Corp.
Attn: Xx. Xxxxxx Xxxxxxx
Richmond County Financial Corp.
0000 Xxxxxxxxx Xxxxxx
Xxxxxx Xxxxxx, Xxx Xxxx 00000
3. Except to the extent specifically modified by this Stock Option
Assumption Agreement, all of the terms and conditions of each Award Agreement as
in effect immediately prior to the
4
Acquisition shall continue in full force and effect and shall not in any way be
amended, revised or otherwise affected by this Stock Option Assumption
Agreement.
IN WITNESS WHEREOF, Richmond has caused this Stock Option Assumption
Agreement to be executed on its behalf by its duly authorized officer as of the
22nd day of March, 1999.
RICHMOND COUNTY FINANCIAL CORP.
By: _______________________
Title: _____________________
ACKNOWLEDGMENT
The undersigned acknowledges receipt of this foregoing Stock Option
Assumption Agreement and understands and acknowledges that all rights and
liabilities with respect to each of his or her Bayonne Options hereby assumed by
Richmond are as set forth only in the Award Agreement, the Bayonne Incentive
Plan and this Stock Option Assumption Agreement and that no other agreements
exist with respect to his Bayonne Options. The undersigned also acknowledges
that, except to the extent specifically modified by this Stock Option Assumption
Agreement, all of the terms and conditions of the Award Agreement as in effect
immediately prior to the effective time shall continue in full force and effect
and shall not in any way be amended, revised or otherwise affected by this Stock
Option Assumption Agreement. The undersigned further acknowledges that the
Bayonne Option or Options described in Exhibit A hereto constitute all of the
options or other rights to purchase Bayonne Stock that he or she owned
immediately prior to the effective time of the Merger.
________________, Optionee
DATED: __________________ , 1999
5
EXHIBIT A
Optionee's Outstanding Options to Purchase Shares
of Bayonne Bancshares, Inc. Common Stock
(Pre-Merger)
DATE OF OPTION GRANT NUMBER OF OUTSTANDING OPTIONS EXERCISE PRICE
Optionee's Outstanding Options to Purchase Shares
of Richmond County Financial Corp. Common Stock
(Post-Merger)
DATE OF OPTION GRANT ADJUSTED NUMBER OF OUTSTANDING OPTIONS
ADJUSTED EXERCISE PRICE
