STOCK OPTION AGREEMENT
FOR INCENTIVE STOCK OPTIONS UNDER SECTION 422
OF THE INTERNAL REVENUE CODE
PURSUANT TO THE
SUN BANCORP, INC.
2002 STOCK OPTION PLAN
----------------------
FOR OFFICERS AND EMPLOYEES
STOCK OPTIONS for a total of ________ shares of Common Stock of Sun
Bancorp, Inc. (the "Company"), which Option is intended to qualify as an
Incentive Stock Option under Section 422 of the Internal Revenue Code of 1986,
as amended, is hereby granted to ________________ (the "Optionee"), at the price
determined as provided in, and in all respects subject to the terms, definitions
and provisions of the 2002 Stock Option Plan (the "Plan") adopted by the Company
which is incorporated by reference herein, receipt of which is hereby
acknowledged.
1. Option Price. The Option price is $________ for each Share, being
100% of the fair market value, as determined by the Committee, of the Common
Stock on the date of grant of this Option (________ __, 2002).
2. Exercises of Option. This Option shall be exercisable in accordance
with provisions of the Plan, provided the holder of such Option is an employee,
director or director emeritus of the Company as of such date, as follows:
(a) Schedule of Rights to Exercise.
Incentive
Stock Options
Date First Exercisable
---- -----------------
Upon grant....................................... 0
As of _____________.............................. ________
As of _____________.............................. ________
As of _____________.............................. ________
As of _____________.............................. ________
As of _____________.............................. ________
Options awarded to the Optionee shall continue to vest annually during
such period that he serves as an employee, director or director emeritus of Sun
National Bank (the "Bank") or the Company. Options shall be 100% vested and
exercisable upon the Retirement (following not less than 10 years of service),
death or Disability of the Optionee, or upon a Change in Control of the Company
or the Bank.
Notwithstanding anything herein to the contrary, in no event shall any
Options granted herein be exercisable for a period of six months from the date
of grant, except in the event of the Retirement (following not less than 10
years of service), death or Disability of the Optionee or a Change in Control of
the Company or the Bank.
Upon termination of service for any reason, other than Disability or
death, such Options shall cease to be exercisable three months from the date of
termination of employment. Upon Disability, all Options shall be deemed
immediately exercisable for a period not to exceed one year from such date of
Disability. Upon death, all Options shall be immediately exercisable by the
estate for the remaining term of such Options.
In the event that the fair market value of the Common Stock subject to
such grant that becomes first exercisable in any calendar year to any one
individual exceeds $100,000, then the excess of each installment shall be deemed
non-incentive stock options.
(b) Method of Exercise. This Option shall be exercisable
by a written notice which shall:
(i) State the election to exercise the Option, the
number of Shares with respect to which it is being exercised, the
person in whose name the stock certificate or certificates for such
Shares of Common Stock is to be registered, his address and Social
Security Number (or if more than one, the names, addresses and Social
Security Numbers of such persons);
(ii) Contain such representations and agreements as
to the holder's investment intent with respect to such shares of Common
Stock as may be satisfactory to the Company's counsel;
(iii) Be signed by the person or persons entitled to
exercise the Option and, if the Option is being exercised by any person
or persons other than the Optionee, be accompanied by proof,
satisfactory to counsel for the Company, of the right of such person or
persons to exercise the Option; and
(iv) Be in writing and delivered in person or by
certified mail to the Treasurer of the Company.
Payment of the purchase price of any Shares with respect to which the
Option is being exercised shall be by certified or bank cashier's or teller's
check. The certificate or certificates for shares of Common Stock as to which
the Option shall be exercised shall be registered in the name of the person or
persons exercising the Option.
(c) Restrictions on Exercise. This Option may not be exercised
if the issuance of the Shares upon such exercise would constitute a violation of
any applicable federal or state
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securities or other law or valid regulation. As a condition to the Optionee's
exercise of this Option, the Company may require the person exercising this
Option to make any representation and warranty to the Company as may be required
by any applicable law or regulation.
3. Non-transferability of Option. This Option may not be transferred in any
manner otherwise than by will or the laws of descent or distribution and may be
exercised during the lifetime of the Optionee only by the Optionee. The terms of
this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
4. Term of Option. This Option may not be exercised more than ten (10) years
from the date of grant of this Option, as set forth below, and may be exercised
during such term only in accordance with the Plan and the terms of this Option.
5. Reload Options. The Optionee will receive the right to a further Option (a
"Reload Option") in the event the Optionee exercises all or a part of an Option
(an "Original Option"), by surrendering already owned Shares of Common Stock in
full or partial payment of the Option Price under such Original Option. Each
such Reload Option shall be granted on the date of exercise of the Original
Option, shall cover a number of Shares of Common Stock not exceeding the whole
number of Shares of Common Stock surrendered in payment of the Option Price
under such Original Option, and any Shares of Common Stock used to satisfy any
taxes incident to the exercise of the Original Option, shall have an Option
Price equal to the fair market value of the Common Stock on the date of grant of
such Reload Option, shall expire on the stated expiration date of the Original
Option and shall be subject to such other terms and conditions as the Committee
may determine.
6. Related Matters. Notwithstanding anything herein to the contrary, additional
conditions or restrictions related to such Options may be contained in the Plan
or the resolutions of the Plan Committee authorizing such grant of Options.
Sun Bancorp, Inc.
Date of Grant: ________________ By: ________________________________
Attest:
_______________________________
[SEAL]
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INCENTIVE STOCK OPTION EXERCISE FORM
------------------------------------
PURSUANT TO THE
SUN BANCORP, INC.
2002 STOCK OPTION PLAN
----------------------
(Date)
Sun Bancorp, Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Dear Sir:
The undersigned elects to exercise the Incentive Stock Option to
purchase _________ shares of Common Stock of Sun Bancorp, Inc. under and
pursuant to a Stock Option Agreement dated _________________.
Delivered herewith is a certified or bank cashier's or teller's check
and/or shares of Common Stock, valued at the fair market value of the stock on
the date of exercise, as set forth below.
$__________ of cash or check
__________ of Common Stock
$ Total
==========
The name or names to be on the stock certificate or certificates and
the address and Social Security Number of such person(s) is as follows:
Name
-------------------------------------------------------------------
Address
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Social Security Number
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Very truly yours,
____________________________________
