Exhibit 99.3
SBT BANCORP, INC.
Non-Qualified Stock Option Agreement Under 1998 Stock Plan
SBT Bancorp, Inc., a Connecticut corporation (the "Company"), hereby
grants as of the _____th day of ________, ______, to ____________________ (the
"Optionee"), a non-qualified stock option to purchase ________ shares (the
"Option Shares") of its Common Stock, no par value (the "Common Stock"), at the
price of $________ per share, on the following terms and conditions:
1. Grant Under 1998 Stock Plan. This option is granted pursuant to and
is governed by the Company's 1998 Stock Plan (as amended from time to time) (the
"Plan"), which is attached hereto as Exhibit A and incorporated herein by
reference. Unless the context otherwise requires, terms used herein shall have
the same meaning as in the Plan. Determinations made in connection with this
option pursuant to the Plan shall be governed by the Plan as it exists on this
date.
2. Grant as Non-Qualified Stock Option; Other Options. This option
shall be treated for Federal income tax purposes as a non-qualified stock
option, and the Board of Directors will take appropriate action, if necessary,
to achieve this result. This option is in addition to any other options
hereafter granted to the Optionee by the Company, but a duplicate original of
this instrument shall not affect the grant of another option.
3. Extent of Option if Business Relationship Continues. If the Optionee
has continued to serve the Company or any of its subsidiaries (the Company and
its subsidiaries are collectively referred to herein as the "Company Group") in
the capacity of an employee, officer, director or consultant (such service is
described herein as maintaining or being involved in a "Business Relationship"
with the Company Group) on the following dates, the Optionee may exercise this
option for the percentage of Option Shares set opposite the applicable date:
Director Options shall become exercisable in two equal annual
installments commencing one year from the date the option is granted and will
expire the earlier of 10 years after the date of grant or 90 days after the
termination of the director's service on the Board.
The foregoing rights are cumulative and, while the Optionee continues
to maintain a Business Relationship with the Company Group may be exercised up
to and including the date which is ten (10) years from the date this option is
granted. All of the foregoing rights are subject to Articles 4 and 5, as
appropriate, if the Optionee ceases to maintain a Business Relationship with the
Company Group or dies or becomes disabled while involved in a Business
Relationship with the Company Group.
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Notwithstanding the foregoing, if (i) any "person", as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), (other than the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the Company, or
any corporation owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their ownership of the stock of
the Company), is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing 50% or more of the combined voting power of the Company's then
outstanding securities, (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board, and any
new director (other than a director designated by a person who has entered into
an agreement with the Company to effect a transaction described in clause (i),
(iii) or (iv) of this paragraph) whose election by the Board or nomination for
election by the Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a majority
thereof, (iii) the stockholders of the Company approve a merger or consolidation
of the Company with any other corporation, other than (a) a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) more than 80% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation or (b) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no
"person" (as hereinabove defined) acquires 50% or more of the combined voting
power of the Company's then outstanding securities, or (iv) the stockholders of
the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all
of the Company's assets, then from and after the date on which public
announcement of the acquisition of such percentage shall have been made, or the
date on which the change in the composition of the Board set forth above shall
have occurred, or the date of any such stockholder approval (any such date being
referred to herein as the "Acceleration Date"), this option shall be exercisable
in full, whether or not otherwise exercisable.
4. Termination of Business Relationship. If the Optionee ceases to
maintain a Business Relationship with the Company Group, other than by reason of
death or disability (as defined in Section 11(d) of the Plan), no further
installments of this option shall become exercisable and this option shall
terminate after the passage of ninety (90) days from the date the Business
Relationship ceases, but in no event later than the scheduled expiration date.
In such case, the Optionee's only rights hereunder shall be those which are
properly exercised before the termination of this option.
5. Death; Disability. If the Optionee is a natural person who dies
while involved in a Business Relationship with the Company Group, this option
may be exercised, to the extent of the number of shares with respect to which
the Optionee could have exercised it on the date of his death, by his estate,
personal representative or beneficiary to whom this option has been assigned
pursuant to Section 9 of the Plan, at any time within one (1) year after the
date of death. If the Optionee is a natural person whose Business Relationship
with the Company Group is terminated by reason of his disability (as defined in
the Plan), this option may be exercised, to the extent of the number of shares
with respect to which the Optionee could have exercised it on the date the
Business Relationship was terminated, at any time within one (1) year after the
date of such termination, but not later than the scheduled expiration date. At
the expiration of such one (1) year period or the scheduled expiration date,
whichever is the earlier, this option shall terminate and the only rights
hereunder shall be those as to which the option was properly exercised before
such termination.
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6. Partial Exercise. Exercise of this option up to the extent vested as
stated above may be made in part at any time and from time to time within the
above limits, except that this option may not be exercised for a fraction of a
share unless such exercise is with respect to the final installment of stock
subject to this option and a fractional share (or cash in lieu thereof) must be
issued to permit the Optionee to exercise completely such final installment. Any
fractional share with respect to which an installment of this option cannot be
exercised because of the limitation contained in the proceeding sentence shall
remain subject to this option and shall be available for later purchase by the
Optionee in accordance with the terms hereof.
7. Payment of Price. The option price is payable in United States
dollars and may be paid in cash or by check, or any combination of the
foregoing, equal in amount to the option price. The Board of Directors, in its
sole discretion, may permit the option price to be paid by delivery of shares of
the Company's Common Stock having an aggregate fair market value (as determined
in accordance with the Plan) equal as of the date of exercise to the option
price. The Board of Directors, in its sole discretion, may permit the option
price to be paid by delivery of the Optionee's personal recourse note bearing
interest payable not less than annually at no less than 100% of the lowest
Applicable Federal Rate, as defined in Section 1274(d) of the Code, or by any
combination of the foregoing equal in amount to the option price.
8. Method of Exercising Option. Subject to the terms and conditions of
this Agreement, this option may be exercised by written notice to the Company,
at the principal executive office of the Company, or to such transfer agent as
the Company shall designate. Such notice shall state the election to exercise
this option and the number of shares in respect of which it is being exercised
and shall be signed by the person or persons so exercising this option. Such
notice shall be accompanied by payment of the full purchase price of such
shares, or such other documents as is necessary to effect payment of the
exercise price as set forth herein and the Company shall deliver a certificate
or certificates representing such shares as soon as practicable after the notice
shall be received. The certificate or certificates for the shares as to which
this option shall have been so exercised shall be registered in the name of the
person or persons so exercising this option and shall be delivered as provided
above to or upon the written order of the person or persons exercising this
option. In the event this option shall be exercised, pursuant to Article 5
hereof, by any person or persons other than the Optionee, such notice shall be
accompanied by appropriate proof of the right of such person or persons to
exercise this option. All shares that shall be purchased upon the exercise of
this option as provided herein shall be fully paid and non-assessable.
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9. Option Not Transferable. This option is not transferable or
assignable except by will or by the laws of descent and distribution or pursuant
to a qualified domestic relations order as defined in the Code or Title I of the
Employment Retirement Income Security Act, or the rules thereunder. During the
Optionee's lifetime only the Optionee can exercise this option.
10. No Obligation to Exercise Option. The grant and acceptance of this
option imposes no obligation on the Optionee to exercise it.
11. No Obligation to Continue Business Relationship. The Company Group
is not by the Plan or this option obligated to continue to maintain a Business
Relationship with the Optionee, nor is the Optionee required to maintain a
Business Relationship with the Company Group.
12. No Rights as Stockholder until Exercise. The Optionee shall have no
rights as a stockholder with respect to shares subject to this Agreement until a
stock certificate therefor has been issued to the Optionee and is fully paid
for. Except as is expressly provided in the Plan with respect to certain changes
in the capitalization of the Company, no adjustment shall be made for dividends
or similar rights for which the record date is prior to the date such stock
certificate is issued.
13. Capital Changes and Business Successions. The Plan contains
provisions covering the treatment of options in a number of contingencies such
as stock splits and mergers. Provisions in the Plan for adjustment with respect
to stock subject to options and the related provisions with respect to
successors to the business of the Company are hereby made applicable hereunder
and are incorporated herein by reference. In general, you should not assume that
options necessarily would survive the acquisition of the Company.
14. Withholding Taxes. The Optionee hereby agrees that the Company may
withhold from the Optionee's wages or other remuneration the appropriate amount
of federal, state and local taxes attributable to the Optionee's exercise of any
installment of this option. At the Company's discretion, the amount required to
be withheld may be withheld in cash from such wages or other remuneration, or in
kind from the Common Stock otherwise deliverable to the Optionee on exercise of
this option. The Optionee further agrees that, if the Company does not withhold
an amount from the Optionee's wages or other remuneration sufficient to satisfy
the Company's withholding obligation, the Optionee will reimburse the Company on
demand, in cash, for the amount underwithheld.
15. Governing Law. This Agreement shall be governed by and interpreted
in accordance with the internal laws of the State of Connecticut.
[signature page follows]
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IN WITNESS WHEREOF the Company and the Optionee have caused this
instrument to be executed, and the Optionee whose signature appears below
acknowledges receipt of a copy of the Plan and acceptance of an original copy of
this Agreement.
SBT BANCORP, INC.
By:
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Name:
Title:
OPTIONEE:
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Name: (type name)
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