EXHIBIT 4.2
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Forms of Option Agreements
for Employees and Directors under the Plan
NON-QUALIFIED STOCK OPTION AGREEMENT (DIRECTORS)
JSB FINANCIAL, INC. 1996 STOCK OPTION PLAN
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This NON-QUALIFIED STOCK OPTION AGREEMENT ("Agreement") is
made and entered into as of the 1st day of January, 1997 by and between JSB
Financial, Inc., a corporation organized and existing under the laws of the
State of Delaware and having an office at 000 Xxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx
00000-0000 ("JSBF") and _____________________ ____________________________, an
individual residing at ______________________________
____________________________________ ("Option Holder").
W I T N E S S E T H :
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WHEREAS, by action of its Board of Directors ("Board"), JSBF
has adopted the JSB Financial, Inc. 1996 Stock Option Plan ("Plan"), pursuant to
which Non-Qualified Stock Options with respect to shares of common stock of JSBF
("Shares") may be granted to Eligible Directors of JSBF and its affiliates
("Corporation"); and
WHEREAS, pursuant to Article IV of the Plan, each person who
is an Eligible Director shall be granted a Non-Qualified Stock Option to
purchase Shares in accordance with the terms of the Plan; and
WHEREAS, the Option Holder is an Eligible Director and
therefore is eligible to be granted a Non-Qualified Stock Option and the Option
Holder desires to accept such grant on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, JSBF and the Option Holder hereby agree as
follows:
Section 1. GRANT OF NON-QUALIFIED STOCK OPTION. JSBF hereby
grants, and the Option Holder hereby accepts JSBF's grant of, a Non-Qualified
Stock Option ("Option") to purchase ____________ Shares ("Optioned Shares"), on
the terms and conditions hereinafter set forth.
Section 2. OPTION PERIOD. The Option Holder shall have the
right to purchase all or any portion of the Optioned Shares at any time during
the period ("Option Period") commencing on the date that is six months after the
effective date of the grant, and ending on the earliest to occur of the
following dates:
(a) the last day of the ten-year period commencing on January
1, 1997;
(b) the last day of the one-year period commencing on the date
the Option Holder ceases to be an Eligible Director other than due to a
Termination for Cause; and
(c) the date the Option Holder ceases to be an Eligible
Director due to a Termination for Cause;
provided, however, that in the event of a Change of Control, if the Option
Period specified above has not commenced, such Option Period shall automatically
commence on the earliest date on which the Change of Control is deemed to have
occurred.
Section 3. EXERCISE PRICE. During the Option Period, the
Option Holder shall have the right to purchase all or any portion of the
Optioned Shares at a price per Share of $_________ ("Exercise Price").
Section 4. METHOD OF EXERCISE. The Option Holder may, at any
time during the Option Period, exercise his right to purchase all or any part of
the Optioned Shares then available for purchase; provided, however, that the
minimum number of Optioned Shares which may be purchased shall be one hundred
(100) or, if less, the total number of Optioned Shares then available for
purchase. The Option Holder shall exercise such right by:
(a) giving written notice to the Committee or Administrator,
in the form attached hereto as Appendix A; and
(b) delivering to the Committee or Administrator full payment
of the Exercise Price for the Optioned Shares to be purchased.
The date of exercise shall be the earliest date practicable following the date
the requirements of this Section 4 have been satisfied, but in no event more
than three (3) days after such date. Payment shall be made (i) in United States
dollars by certified check, money order or bank draft made payable to the order
of JSBF, (ii) in Shares duly endorsed for transfer and with all necessary stock
transfer tax stamps attached, already owned by the Option Holder and having a
fair market value equal to the Exercise Price, such fair market value to be
determined in such manner as may be provided by the Committee or the
Administrator or as may be required in order to comply with or conform to the
requirements of any applicable laws or regulations, or (iii) in a combination of
(i) and (ii).
Section 5. DELIVERY AND REGISTRATION OF OPTIONED SHARES. As
soon as is practicable following the date on which the Option Holder has
satisfied the requirements of Section 4, the Committee shall take such action as
is necessary to cause JSBF to issue a stock certificate evidencing the Option
Holder's ownership of the Optioned Shares that have been purchased. The Option
Holder shall have no right to vote or to receive dividends, nor have any other
rights with respect to Optioned Shares, prior to the date as of which such
Optioned Shares are transferred to the Option Holder on the stock transfer
records of JSBF, and no adjustments shall be made for any dividends or other
rights for which the record date is prior to the date as of which such transfer
is effected, except as may be required under Sections 7 and 8. The obligation of
JSBF to deliver Shares under this Agreement shall, if the Committee so requests,
be conditioned upon the receipt of a representation as to the investment
intention of the Option Holder 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 applicable federal, state or local law. It may be
provided that any such representation shall become inoperative upon a
registration of the Shares or upon the occurrence of any other event eliminating
the necessity of such representation. JSBF shall not be required to deliver any
Shares under this Agreement prior to (a) the admission of such Shares to listing
on any stock exchange on which Shares may then be
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listed, or (b) the completion of such registration or other qualification under
any state or federal law, rule or regulations as the Committee shall determine
to be necessary or advisable.
Section 6. GRANT OF APPRECIATION RIGHT.
(a) The Option Holder is hereby granted an Appreciation Right
relating to all of the Shares subject to the Option granted hereunder, with an
Exercise Price per Share equal to the Exercise Price per Share of such Option.
Such Appreciation Right shall be exercisable only in the event of a Change of
Control and in accordance with and subject to the terms and conditions imposed
under the Plan and this Agreement.
(b) The Option Holder may exercise such Appreciation Right by
delivering to the Committee or Administrator advance written notice, in such
form and manner as may be prescribed by the Committee or Administrator for
indicating his or her intent to exercise the Appreciation Right and the number
of Shares with respect to which the Appreciation Right is to be exercised. The
date of exercise shall be the earliest date practicable following the date on
which the notice referred to in this Section 6(b) is received by the Committee
or Administrator, but in no event more than three days after such notice is
received. On the date of exercise or as soon thereafter as is practicable, JSBF
shall pay to the Option Holder exercising the Appreciation Right an amount
equivalent to the excess of (i) the Fair Market Value of the applicable Shares
on the date of exercise, over (ii) the Exercise Price of such Shares, as
adjusted pursuant to Section 7 of this Agreement and Article VI of the Plan.
Payment of an Appreciation Right shall be made in cash.
(c) The exercise of such Appreciation Right shall
automatically result in a reduction of the number of Optioned Shares available
for purchase hereunder by the number of Shares as to which such Appreciation
Right is exercised.
Section 7. GRANT OF DIVIDEND EQUIVALENT RIGHT. Pursuant to
Article VI of the Plan, the Option Holder is hereby granted a Dividend
Equivalent Right relating to all of the Shares subject to the Option granted
hereunder. Pursuant to such Dividend Equivalent Right, the Option Holder shall
receive a payment equal to the value of the Dividend Equivalent Rights relating
to the Shares being acquired pursuant to such Option exercise. To determine the
payment the following special definitions shall apply:
(a) CREDIT DATE means each anniversary of the Effective
Date of the Plan.
(b) DER CREDIT means an amount relating to a Share
subject to an Option granted pursuant to Section 4.3,
4.4 and 4.8, which amount shall be credited to a
memorandum account established and maintained by JSBF
for the Option Holder.
(c) DER YEAR means the most recent calendar year ending
prior to the applicable Credit Date.
(d) EPS means earnings per share.
(e) JSBF DIV means the percentage of EPS paid as cash
dividends (including "regular," "special" or
"extraordinary" dividends) on outstanding Shares of
JSBF during the applicable DER Year.
(f) US DIV means the average percentage of EPS paid as
cash dividends (including "regular," "special" or
"extraordinary" dividends) on the
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outstanding common stock of the 25 largest stock form
thrift institutions in the United States during the
applicable DER Year, as determined by JSBF on the
basis of such institutions' market capitalization at
the end of such DER Year.
(g) WEIGHTED AVERAGE VALUE means the sum of the DER
Credits attributable to Shares subject to Options
granted to an Eligible Individual or Eligible
Director prior to a Preliminary Purchase Event,
divided by the total number of Shares subject to such
Options.
For purposes of determining the value of Dividend Equivalent Rights relating to
Shares subject to Options granted pursuant to Section 4.3 and 4.4, as of each
Credit Date the Option Holder shall receive a DER Credit for each such Share if
JSBF DIV exceeded US DIV for the applicable DER Year. The value of the DER
Credit shall be equal to one percent (1%) of JSBF EPS for the applicable DER
Year for each whole percentage point that JSBF DIV exceeded US DIV for such DER
Year. The value of the Dividend Equivalent Rights to be paid to the Option
Holder upon the exercise of an Option granted pursuant to Section 4.4 shall be
equal to the sum of the DER Credits attributable to the Shares acquired pursuant
to the exercise of the Option.
The value of a Dividend Equivalent Right relating to a Share subject to an
Option granted pursuant to Section 4.8 shall be the Weighted Average Value of
all DER Credits attributable to Shares subject to Options granted to the Option
Holder prior to the Preliminary Purchase Event, excluding Options granted
pursuant to Section 4.4(a)(i).
In the event the Option Holder exercises an Option granted pursuant to Section
4.3, 4.4 or 4.8 during the period beginning with a Credit Date and ending on the
date JSBF actually determines the value of the DER Credit, if any, to be
credited pursuant to Section 6.2(b) with respect to such Credit Date, JSBF shall
pay the Option Holder an amount equal to the value of the DER Credit as soon as
practicable following the determination of such value.
Section 8. ADJUSTMENTS IN THE EVENT OF REORGANIZATION. In the
event of any merger, consolidation, or other business reorganization in which
JSBF is the surviving entity, and in the event of any stock split, stock
dividend or other event generally affecting the number of Shares held by each
Person who is then a shareholder of record, the number of Optioned Shares
subject to the Option granted hereunder and the Exercise Price per Share of such
Option shall be adjusted in accordance with Section 7.3(a) of the Plan to
account for such event. In the event of any merger, consolidation, or other
business reorganization in which JSBF is not the surviving entity, the Option
granted hereunder shall be cancelled or adjusted in accordance with Section
7.3(b) of the Plan.
Section 9. NO RIGHT TO CONTINUED BOARD MEMBERSHIP. Nothing in
this Agreement, nor any action of the Board or Committee with respect to this
Agreement, shall be held or construed to confer upon the Option Holder any right
to a continuation of membership on the Board of the Corporation. The Option
Holder may be dismissed or otherwise dealt with as though this Agreement had not
been entered into.
Section 10. TAXES. Where any person is entitled to receive
Shares pursuant to the exercise of the Non-Qualified Stock Option granted
hereunder, the Corporation shall have the right to require such person to pay to
the Corporation the amount of any tax which the
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Corporation is required to withhold with respect to such Shares, or, in lieu
thereof, to retain, or to sell without notice, a sufficient number of Shares to
cover the amount required to be withheld. Where any person is entitled to
receive a cash payment pursuant to the exercise of a Stock Appreciation Right,
the Corporation shall have the right to require such person to pay to the
Corporation the amount of any tax which the Corporation is required to withhold
with respect to such cash payment.
Section 11. NOTICES. Any communication required or permitted
to be given under the Plan, including any notice, direction, designation,
comment, instruction, objection or waiver, shall be in writing and shall be
deemed to have been given at such time as it is delivered personally or five (5)
days after mailing if mailed, postage prepaid, by registered or certified mail,
return receipt requested, addressed to such party at the address listed below,
or at such other address as one such party may by written notice specify to the
other party:
(a) If to the Committee:
JSB Financial, Inc.
000 Xxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000-0000
Attention: Administrator of the JSB Financial, Inc.
1996 Stock Option Plan
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(b) If to the Option Holder, to the Option Holder's address as
shown in the Corporation's personnel records.
Section 12. NO ASSIGNMENT. The Non-Qualified Stock Option
granted hereunder shall not be subject in any manner to anticipation, alienation
or assignment, nor shall such Non-Qualified Stock Option be liable for or
subject to debts, contracts, liabilities, engagements or torts, nor shall it be
transferable by the Option Holder other than by will or by the laws of descent
and distribution. During the lifetime of the Option Holder, the Non-Qualified
Stock Option granted hereunder shall be exercisable only by him.
Section 13. SUCCESSORS AND ASSIGNS. This Agreement shall inure
to the benefit of and shall be binding upon JSBF and the Option Holder and their
respective heirs, successors and assigns.
Section 14. CONSTRUCTION OF LANGUAGE. Whenever appropriate in
the Agreement, words used in the singular may be read in the plural, words used
in the plural may be read in the singular, and words importing the masculine
gender may be read as referring equally to the feminine or the neuter. Any
reference to a Section shall be a reference to a Section of this Agreement,
unless the context clearly indicates otherwise. Capitalized terms not
specifically defined herein shall have the meanings assigned to them under the
Plan.
Section 15. GOVERNING LAW. This Agreement shall be construed,
administered and enforced according to the laws of the State of New York without
giving effect to the conflict of laws principles thereof, except to the extent
that such laws are preempted by the federal law.
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Section 16. AMENDMENT. This Agreement may be amended, in whole
or in part and in any manner not inconsistent with the provisions of the Plan,
at any time and from time to time, by written agreement between JSBF and the
Option Holder.
Section 17. PLAN PROVISIONS CONTROL. This Agreement and the
rights and obligations created hereunder shall be subject to all of the terms
and conditions of the Plan. In the event of any conflict between the provisions
of the Plan and the provisions of this Agreement, the terms of the Plan, which
are incorporated herein by reference, shall control. By signing this Agreement,
the Option Holder acknowledges receipt of a copy of the Plan.
Section 18. ACCEPTANCE BY OPTION HOLDER. By executing this
Agreement and returning a fully executed copy hereof to the Committee at the
address specified in Section 11, the Option Holder signifies his acceptance of
the terms and conditions of this Non-Qualified Stock Option. If a fully executed
copy of this Agreement is not received by the Committee within forty-five (45)
days after the date first above written, the Committee may revoke the
NonQualified Stock Option granted, and thereby avoid all obligations, hereunder.
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IN WITNESS WHEREOF, the Option Holder has executed, and JSBF
has caused its duly authorized representative to execute, this Agreement as of
the date first above written.
JSB FINANCIAL, INC.
By:_______________________________
Title:____________________________
Date:_____________________________
ATTEST:
__________________________
Secretary
[SEAL]
OPTION HOLDER
_________________________________
Date:____________________________
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EXHIBIT "A" TO NON-QUALIFIED STOCK OPTION AGREEMENT (DIRECTORS)
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JSB FINANCIAL, INC. 1996 STOCK OPTION PLAN
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NOTICE OF EXERCISE OF NON-QUALIFIED STOCK OPTION
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1. INSTRUCTIONS. Use this Notice to inform the Committee or Administrator
administering the JSB Financial, Inc. 1996 Stock Option ------------ Plan
("Plan") that you are exercising your right to purchase shares of common
stock ("Shares") of JSB Financial Inc. ("JSBF") pursuant to a non-qualified
stock option ("Option") granted under the Plan. If you are not the person
to whom the Option was granted ("Option Holder"), you must attach to this
Notice proof of your right to exercise the Option granted under the
Non-Quali- fied Stock Option Agreement entered into between the Company and
the Option Holder ("Agreement"). This Notice should be personally delivered
or mailed by certified mail, return receipt requested to: JSB Financial
Inc., 000 Xxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000-0000 Attention:
Administrator of the JSB Financial, Inc. 1996 Stock Option Plan. The
effective date of the exercise of the Option shall be the date this Notice
is personally delivered or post marked by the United States Post Office if
mailed. Except as specifically provided to the contrary herein, capitalized
terms shall have the meanings assigned to them under the Plan. This Notice
is subject to all of the terms and conditions of the Plan and the
Agreement.
2. PURCHASE OF SHARES. Pursuant to the Agreement made and entered into as of
_____________________, 19 ___ [ENTER DATE OF AGREEMENT] by and between the
Company and [ENTER THE NAME OF THE OPTION HOLDER], I hereby exercise my
right to purchase __________ Shares at an Exercise Price per Share of
$_________, for a Total Exercise Price of $_____________ [ENTER THE PRODUCT
OF THE NUMBER OF SHARES MULTIPLIED BY THE EXERCISE PRICE PER SHARE]. As a
payment for such Shares, I [CHECK AND COMPLETE ONE OF THE FOLLOWING:]
(a) |_| enclose a certified check, money order, or bank draft payable
to the order of JSB Financial, Inc. in the amount of: $ $_______
(b) |_| have made arrangements for a margin loan. My broker will be
forwarding a check in the amount of: $ $_______
(c) |_| have authorized my broker to sell, pursuant to a "cashless
exercise." My broker will be contacting you for confirmation
and will forward a check in the amount of: $ $_______
TOTAL EXERCISE PRICE ________
3. COMPLIANCE WITH TAX AND SECURITIES LAWS. I understand that I must rely on,
and consult with, my own tax and legal counsel (and not JSBF or Jamaica
Savings Bank FSB) regarding the application of all laws -- particularly tax
and securities laws -- to the transactions to be effected pursuant to my
Option and this Notice. I understand that I will be responsible for paying
any federal, state and local taxes that may become due upon the sale
(including a sale pursuant to a "cashless exercise") or other disposition
of Shares issued pursuant to this Notice and that I must consult with my
own tax advisor regarding how and when such income will be reportable.
____________________________________________ __________________
Signature Date
________________________________________________________________________________
Address
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Administrator (on behalf of the Committee)
Received [CHECK ONE]: |_| By Hand |_| By Mail Post Marked_________________
Date of Post Xxxx
By________________________________ _________________
Authorized Signature Date of Receipt
NON-QUALIFIED STOCK OPTION AGREEMENT (OFFICERS)
JSB FINANCIAL, INC. 1996 STOCK OPTION PLAN
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This NON-QUALIFIED STOCK OPTION AGREEMENT ("Agreement") is
made and entered into as of the 1st day of January, 1997 by and between JSB
Financial, Inc., a corporation organized and existing under the laws of the
State of Delaware and having an office at 000 Xxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx
00000-0000 ("JSBF") and _____________________ ____________________________, an
individual residing at _______________________________
_________________________________________ ("Option Holder").
W I T N E S S E T H :
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WHEREAS, by action of its Board of Directors ("Board"), JSBF
has adopted the JSB Financial, Inc. 1996 Stock Option Plan ("Plan"), pursuant to
which Non-Qualified Stock Options with respect to shares of common stock of JSBF
("Shares") may be granted to eligible officers of JSBF and its affiliates
("Corporation"); and
WHEREAS, pursuant to Article III of the Plan, the Employee
Benefits Committee of Jamaica Savings Bank FSB ("Committee") has been appointed
to select the individuals to whom Non-Qualified Stock Options shall be granted;
and
WHEREAS, the Committee has determined that the Option Holder
is eligible to be granted a Non-Qualified Stock Option and desires to grant a
Non-Qualified Stock Option to the Option Holder, and the Option Holder desires
to accept such grant, on the terms and conditions hereinafter set forth;
NOW, THEREFORE, JSBF and the Option Holder hereby agree as
follows:
SECTION 1. GRANT OF NON-QUALIFIED STOCK OPTION. JSBF hereby
grants, and the Option Holder hereby accepts JSBF's grant of, a Non-Qualified
Stock Option ("Option") to purchase ______________ Shares ("Optioned Shares"),
on the terms and conditions hereinafter set forth.
SECTION 2. OPTION PERIOD. The Option Holder shall have the
right to purchase all or any portion of the Optioned Shares at any time during
the period ("Option Period") commencing on the date that is six months after the
effective date of the grant, and ending on the earliest to occur of the
following dates:
(a) the last day of the ten-year period commencing on January
1, 1997;
(b) the last day of the three-month period commencing on the
date of the Option Holder's termination of employment with the
Corporation, other than on account of death, Disability, Retirement or
a Termination for Cause;
(c) the last day of the one-year period commencing on the date
of the Option Holder's termination of employment with the Corporation
due to death, Disability or Retirement; and
(d) the date the Option Holder ceases to be an employee of the
Corporation due to a Termination for Cause;
provided, however, that in the event of a Change of Control, if the Option
Period specified above has not commenced, such Option Period shall automatically
commence on the earliest date on which the Change of Control is deemed to have
occurred.
SECTION 3. EXERCISE PRICE. During the Option Period, the
Option Holder shall have the right to purchase all or any portion of the
Optioned Shares at a price per Share of $_____________ ("Exercise Price").
SECTION 4. METHOD OF EXERCISE. The Option Holder may, at any
time during the Option Period, exercise his right to purchase all or any part of
the Optioned Shares then available for purchase; provided, however, that the
minimum number of Optioned Shares which may be purchased shall be one hundred
(100) or, if less, the total number of Optioned Shares then available for
purchase. The Option Holder shall exercise such right by:
(a) giving written notice to the Committee or Administrator,
in the form attached hereto as Appendix A; and
(b) delivering to the Committee or Administrator full payment
of the Exercise Price for the Optioned Shares to be purchased.
The date of exercise shall be the earliest date practicable following the date
the requirements of this Section 4 have been satisfied, but in no event more
than three (3) days after such date. Payment shall be made (i) in United States
dollars by certified check, money order or bank draft made payable to the order
of JSBF, (ii) in Shares duly endorsed for transfer and with all necessary stock
transfer tax stamps attached, already owned by the Option Holder and having a
fair market value equal to the Exercise Price, such fair market value to be
determined in such manner as may be provided by the Committee or the
Administrator or as may be required in order to comply with or conform to the
requirements of any applicable laws or regulations, or (iii) in a combination of
(i) and (ii).
SECTION 5. DELIVERY AND REGISTRATION OF OPTIONED SHARES. As
soon as is practicable following the date on which the Option Holder has
satisfied the requirements of Section 4, the Committee shall take such action as
is necessary to cause JSBF to issue a stock certificate evidencing the Option
Holder's ownership of the Optioned Shares that have been purchased. The Option
Holder shall have no right to vote or to receive dividends, nor have any other
rights with respect to Optioned Shares, prior to the date as of which such
Optioned Shares are transferred to the Option Holder on the stock transfer
records of JSBF, and no adjustments shall be made for any dividends or other
rights for which the record date is prior to the date as of which such transfer
is effected, except as may be required under Sections 7 and 8. The obligation of
JSBF to deliver Shares under this Agreement shall, if the Committee so requests,
be conditioned upon the receipt of a representation as to the investment
intention of the Option
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Holder 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
applicable federal, state or local law. It may be provided that any such
representation shall become inoperative upon a registration of the Shares or
upon the occurrence of any other event eliminating the necessity of such
representation. JSBF shall not be required to deliver any Shares under this
Agreement prior to (a) the admission of such Shares to listing on any stock
exchange on which Shares may then be listed, or (b) the completion of such
registration or other qualification under any state or federal law, rule or
regulations as the Committee shall determine to be necessary or advisable.
SECTION 6. GRANT OF APPRECIATION RIGHT.
(a) The Option Holder is hereby granted an Appreciation Right
relating to all of the Shares subject to the Option granted hereunder, with an
Exercise Price per Share equal to the Exercise Price per Share of such Option.
Such Appreciation Right shall be exercisable only in the event of a Change of
Control and in accordance with and subject to the terms and conditions imposed
under the Plan and this Agreement.
(b) The Option Holder may exercise such Appreciation Right by
delivering to the Committee or Administrator advance written notice, in such
form and manner as may be prescribed by the Committee or Administrator for
indicating his or her intent to exercise the Appreciation Right and the number
of Shares with respect to which the Appreciation Right is to be exercised. The
date of exercise shall be the earliest date practicable following the date on
which the notice referred to in this Section 6(b) is received by the Committee
or Administrator, but in no event more than three days after such notice is
received. On the date of exercise or as soon thereafter as is practicable, JSBF
shall pay to the Option Holder exercising the Appreciation Right an amount
equivalent to the excess of (i) the Fair Market Value of the applicable Shares
on the date of exercise, over (ii) the Exercise Price of such Shares, as
adjusted pursuant to Section 7 of this Agreement and Article VI of the Plan.
Payment of an Appreciation Right shall be made in cash.
(c) The exercise of such Appreciation Right shall
automatically result in a reduction of the number of Optioned Shares available
for purchase hereunder by the number of Shares as to which such Appreciation
Right is exercised.
SECTION 7. GRANT OF DIVIDEND EQUIVALENT RIGHT. Pursuant to
Article VI of the Plan, the Option Holder is hereby granted a Dividend
Equivalent Right relating to all of the Shares subject to the Option granted
hereunder. Pursuant to such Dividend Equivalent Right, the Option Holder shall
receive a payment equal to the value of the Dividend Equivalent Rights relating
to the Shares being acquired pursuant to such Option exercise. To determine the
payment the following special definitions shall apply:
(a) CREDIT DATE means each anniversary of the Effective
Date of the Plan.
(b) DER CREDIT means an amount relating to a Share
subject to an Option granted pursuant to Section 4.3,
4.4 and 4.8, which amount shall be credited to a
memorandum account established and maintained by JSBF
for the Option Holder.
(c) DER YEAR means the most recent calendar year ending
prior to the applicable Credit Date.
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(d) EPS means earnings per share.
(e) JSBF DIV means the percentage of EPS paid as cash
dividends (including "regular," "special" or
"extraordinary" dividends) on outstanding Shares of
JSBF during the applicable DER Year.
(f) US DIV means the average percentage of EPS paid as
cash dividends (including "regular," "special" or
"extraordinary" dividends) on the outstanding common
stock of the 25 largest stock form thrift
institutions in the United States during the
applicable DER Year, as determined by JSBF on the
basis of such institutions' market capitalization at
the end of such DER Year.
(g) WEIGHTED AVERAGE VALUE means the sum of the DER
Credits attributable to Shares subject to Options
granted to an Eligible Individual or Eligible
Director prior to a Preliminary Purchase Event,
divided by the total number of Shares subject to such
Options.
For purposes of determining the value of Dividend Equivalent Rights relating to
Shares subject to Options granted pursuant to Section 4.3 and 4.4, as of each
Credit Date the Option Holder shall receive a DER Credit for each such Share if
JSBF DIV exceeded US DIV for the applicable DER Year. The value of the DER
Credit shall be equal to one percent (1%) of JSBF EPS for the applicable DER
Year for each whole percentage point that JSBF DIV exceeded US DIV for such DER
Year. The value of the Dividend Equivalent Rights to be paid to the Option
Holder upon the exercise of an Option granted pursuant to Section 4.4 shall be
equal to the sum of the DER Credits attributable to the Shares acquired pursuant
to the exercise of the Option.
The value of a Dividend Equivalent Right relating to a Share subject to an
Option granted pursuant to Section 4.8 shall be the Weighted Average Value of
all DER Credits attributable to Shares subject to Options granted to the Option
Holder prior to the Preliminary Purchase Event, excluding Options granted
pursuant to Section 4.4(a)(i).
In the event the Option Holder exercises an Option granted pursuant to Section
4.3, 4.4 or 4.8 during the period beginning with a Credit Date and ending on the
date JSBF actually determines the value of the DER Credit, if any, to be
credited pursuant to Section 6.2(b) with respect to such Credit Date, JSBF shall
pay the Option Holder an amount equal to the value of the DER Credit as soon as
practicable following the determination of such value.
SECTION 8. ADJUSTMENTS IN THE EVENT OF REORGANIZATION. In the
event of any merger, consolidation, or other business reorganization in which
JSBF is the surviving entity, and in the event of any stock split, stock
dividend or other event generally affecting the number of Shares held by each
Person who is then a shareholder of record, the number of Optioned Shares
subject to the Option granted hereunder and the Exercise Price per Share of such
Option shall be adjusted in accordance with Section 7.3(a) of the Plan to
account for such event. In the event of any merger, consolidation, or other
business reorganization in which JSBF is not the surviving entity, the Option
granted hereunder shall be cancelled or adjusted in accordance with Section
7.3(b) of the Plan.
SECTION 9. NO RIGHT TO CONTINUED EMPLOYMENT. Nothing in this
Agreement nor any action of the Board or Committee with respect to this
Agreement shall be held or construed to confer upon the Option Holder any right
to a continuation of employment by the
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Corporation. The Option Holder may be dismissed or otherwise dealt with as
though this Agreement had not been entered into.
SECTION 10. TAXES. Where any person is entitled to receive
Shares pursuant to the exercise of the Non-Qualified Stock Option granted
hereunder, the Corporation shall have the right to require such person to pay to
the Corporation the amount of any tax which the Corporation is required to
withhold with respect to such Shares, or, in lieu thereof, to retain, or to sell
without notice, a sufficient number of Shares to cover the amount required to be
withheld. Where any person is entitled to receive cash pursuant to the exercise
of a Stock Appreciation Right, the Corporation shall have the right to retain
the amount of any tax which the Corporation is required to withhold with respect
to such cash payment.
SECTION 11. NOTICES. Any communication required or permitted
to be given under the Plan, including any notice, direction, designation,
comment, instruction, objection or waiver, shall be in writing and shall be
deemed to have been given at such time as it is delivered personally or five (5)
days after mailing if mailed, postage prepaid, by registered or certified mail,
return receipt requested, addressed to such party at the address listed below,
or at such other address as one such party may by written notice specify to the
other party:
(a) If to the Committee:
JSB Financial, Inc.
000 Xxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000-0000
Attention: Administrator of the JSB Financial, Inc.
1996 Stock Otpion Plan
----------------------------------------
(b) If to the Option Holder, to the Option Holder's
address as shown in the Corporation's personnel records.
SECTION 12. NO ASSIGNMENT. The Non-Qualified Stock Option
granted hereunder shall not be subject in any manner to anticipation, alienation
or assignment, nor shall such Non-Qualified Stock Option be liable for or
subject to debts, contracts, liabilities, engagements or torts, nor shall it be
transferable by the Option Holder other than by will or by the laws of descent
and distribution. During the lifetime of the Option Holder, the Non-Qualified
Stock Option granted hereunder shall be exercisable only by him.
SECTION 13. SUCCESSORS AND ASSIGNS. This Agreement shall inure
to the benefit of and shall be binding upon JSBF and the Option Holder and their
respective heirs, successors and assigns.
SECTION 14. CONSTRUCTION OF LANGUAGE. Whenever appropriate in
the Agreement, words used in the singular may be read in the plural, words used
in the plural may be read in the singular, and words importing the masculine
gender may be read as referring equally to the feminine or the neuter. Any
reference to a Section shall be a reference to a Section of this Agreement,
unless the context clearly indicates otherwise. Capitalized terms not
specifically defined herein shall have the meanings assigned to them under the
Plan.
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SECTION 15. GOVERNING LAW. This Agreement shall be construed,
administered and enforced according to the laws of the State of New York without
giving effect to the conflict of laws principles thereof, except to the extent
that such laws are preempted by the federal law.
SECTION 16. AMENDMENT. This Agreement may be amended, in whole
or in part and in any manner not inconsistent with the provisions of the Plan,
at any time and from time to time, by written agreement between JSBF and the
Option Holder.
SECTION 17. PLAN PROVISIONS CONTROL. This Agreement and the
rights and obligations created hereunder shall be subject to all of the terms
and conditions of the Plan. In the event of any conflict between the provisions
of the Plan and the provisions of this Agreement, the terms of the Plan, which
are incorporated herein by reference, shall control. By signing this Agreement,
the Option Holder acknowledges receipt of a copy of the Plan.
SECTION 18. ACCEPTANCE BY OPTION HOLDER. By executing this
Agreement and returning a fully executed copy hereof to the Committee at the
address specified in Section 11, the Option Holder signifies his acceptance of
the terms and conditions of this Non-Qualified Stock Option. If a fully executed
copy of this Agreement is not received by the Committee within forty-five (45)
days after the date first above written, the Committee may revoke the
NonQualified Stock Option granted, and thereby avoid all obligations, hereunder.
IN WITNESS WHEREOF, the Option Holder has executed, and JSBF
has caused its duly authorized representative to execute, this Agreement as of
the date first above written.
JSB FINANCIAL, INC.
By:______________________________
Title:___________________________
Date:____________________________
ATTEST:
___________________________
Secretary
[SEAL]
[OPTION HOLDER]
________________________________
Date:___________________________
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APPENDIX "A" TO NON-QUALIFIED STOCK OPTION AGREEMENT (OFFICERS)
---------------------------------------------------------------
JSB FINANCIAL, INC. 1996 STOCK OPTION PLAN
------------------------------------------
NOTICE OF EXERCISE OF NON-QUALIFIED STOCK OPTION
------------------------------------------------
1. INSTRUCTIONS. Use this Notice to inform the Committee or the Administrator
administering the JSB Financial, Inc. 1996 Stock Option Plan ("Plan") that
you are exercising your right to purchase shares of common stock ("Shares")
of JSB Financial, Inc. ("JSBF") pursuant to a non-qualified stock option
("Option") granted under the Plan. If you are not the person to whom the
Option was granted ("Option Recipient"), you must attach to this Notice
proof of your right to exercise the Option granted under the Non-Qualified
Stock Option Agreement entered into between JSBF and the Option Recipient
("Agreement"). This Notice should be personally delivered or mailed by
certified mail, return receipt requested to: JSB Financial Inc., 000
Xxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000-0000 Attention: Administrator of the
JSB Financial, Inc. 1996 Stock Option Plan. The effective date of the
exercise of the Option shall be the earliest date practicable following the
date this Notice is received by the Plan Administrator, but in no event
more than three days after such date ("Effective Date"). Except as
specifically provided to the contrary herein, capitalized terms shall have
the meanings assigned to them under the Plan. This Notice is subject to all
of the terms and conditions of the Plan and the Agreement.
2. PURCHASE OF SHARES. Pursuant to the Agreement made and entered into as of
_____________________, 19 ___ [ENTER DATE OF AGREEMENT] by and between JSBF
and [ENTER THE NAME OF THE OPTION RECIPIENT], I hereby exercise my right to
purchase __________ Shares at an Exercise Price per Share of $_________,
for a Total Exercise Price of $_____________ [ENTER THE PRODUCT OF THE
NUMBER OF SHARES MULTIPLIED BY THE EXERCISE PRICE PER SHARE]. As a payment
for such Shares, I [CHECK AND COMPLETE ONE OF THE FOLLOWING]:
(a) |_| enclose a certified check, money order, or bank draft payable
to the order of JSB Financial, Inc. in the amount of: $ $_______
(b) |_| have made arrangements for a margin loan. My broker will be
forwarding a check in the amount of: $ $_______
(c) |_| have authorized my broker to sell, pursuant to a "cashless
exercise." My broker will be contacting you for confirmation
and will forward a check in the amount of: $ $_______
TOTAL EXERCISE PRICE $_______
3. WITHHOLDING ELECTIONS. [FOR OPTION RECIPIENTS ONLY. BENEFICIARIES SHOULD
NOT COMPLETE.] I understand that I am responsible for the amount of
federal, state and local taxes required to be withheld with respect to the
Shares to be issued to me pursuant to this Notice, but that I may request
JSBF to retain or sell a sufficient number of such Shares to cover the
amount to be withheld. I hereby request that any taxes required to be
withheld be paid in the following manner [CHECK ONE]:
(A) |_| With a certified or bank check that I will deliver to the
Administrator on the day after the Effective Date of my Option
exercise.
(B) |_| With the proceeds from a sale of Shares that would otherwise be
distributed to me.
I understand that the withholding elections I have made on this form are
not binding on the Committee, and that the Committee will decide the amount
to be withheld and the method of withholding and advise me of its decision
prior to the Effective Date. I further understand that the Committee or
Administrator may request additional information or assurances regarding
the manner and time at which I will report the income attributable to the
distribution to be made to me.
I further understand that if I have elected to have Shares sold to satisfy
tax withholding, I may be asked to pay a minimal amount of such taxes in
cash in order to avoid the sale of more Shares than are necessary.
4. COMPLIANCE WITH TAX AND SECURITIES LAWS. I understand that I must rely on,
and consult with, my own tax and legal counsel (and not JSBF or Jamaica
Savings Bank FSB) regarding the application of all laws -- particularly tax
and securities laws -- to the transactions to be effected pursuant to my
Option and this Notice. I understand that I will be responsible for paying
any federal, state and local taxes that may become due upon the sale
(including a sale pursuant to a "cashless exercise") or other disposition
of Shares issued pursuant to this Notice and that I must consult with my
own tax advisor regarding how and when such income will be reportable.
____________________________________________ __________________
Signature Date
________________________________________________________________________________
Address
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
ADMINISTRATOR (ON BEHALF OF THE COMMITTEE)
Received [CHECK ONE]: |_| By Hand |_| By Mail Post Marked_________________
Date of Post Xxxx
By________________________________ _________________
Authorized Signature Date of Receipt
