Exhibit (10)Z
FNB CORPORATION
2006 INCENTIVE STOCK PLAN
FORM OF
INCENTIVE STOCK OPTION AGREEMENT
FOR
EMPLOYEE
Granted {DATE 1}
This Incentive Stock Option Agreement evidences the grant of an Incentive
Stock Option ("Option") to {NAME} (the "Participant") pursuant to Article VI
of the FNB Corporation 2006 Incentive Stock Plan (the "Plan"). This
Agreement also describes the terms and conditions of the Option evidenced by
this Agreement.
1. Grant of Options. In consideration of the services rendered to FNB
Corporation (the "Company") and/or its Subsidiaries by the Participant
as an Employee of the Company or a Subsidiary, the Company hereby
grants to the Participant an Option to purchase all or any part of a
total of {NUMBER} Shares of the Company's Stock at a price of ${PRICE}
per Share ("Option Price"). This Option is granted as of {DATE 1}
("Award Date"). This Option is granted pursuant to the Plan and is
subject to the terms thereof.
2. Term.
(a) Normal Term. The term of this Option is {TERM YEARS} years,
until {DATE 2}; provided, however, that this Option may be
terminated earlier as provided below.
(b) Early Termination. This Option will terminate upon any of the
following events:
(i) Death. This Option will terminate one year after the
death of the Participant if the Participant dies while
employed by the Company or one of its Subsidiaries.
(ii) Disability. This Option will terminate one year after the
Participant's employment with the Company or one of its
Subsidiaries terminates on account of the Participant's
disability within the meaning of Section 22(e)(3) of the
Internal Revenue Code ("Disability").
(iii) Retirement. This Option will terminate one year after the
Participant's retirement from employment with the Company
or one of its Subsidiaries in accordance with any
applicable Company policy on mandatory or permissive,
early or normal retirement as in effect at the date of
such retirement ("Retirement").
(iv) Other Cessation of Company Service. Except as provided in
the preceding provisions of this Paragraph 2(b), (1) this
Option will terminate on the date the Participant's
Company Service (as defined in Paragraph 7) (A) ceases at
the Company's or a Subsidiary's instigation for "cause,"
or (B) is terminated by the Participant for any reason
other than death, disability, or retirement, and (2) this
Option will terminate three months after the date the
Participant's Company Service ceases at the Company's or a
Subsidiary's instigation for reasons other than for
"cause." For purposes of this paragraph "cause" shall
mean continued neglect of duty, willful and material
misconduct in connection with the performance of the
Participant's duties and obligations, and any other
conduct of the Participant involving moral turpitude,
commission of a crime, or habitual drunkenness or drug
abuse, which would make retention of the Participant in
his position with his employer prejudicial to its best
interests.
3. Exercise.
(a) Exercisability. This Option is first exercisable, in whole or
in part, on and after the applicable time provided below:
(i) Subject to earlier exercisability as provided in (ii)
below, this Option shall become exercisable as follows:
{VESTING SCHEDULE}.
(ii) If a Change in Control occurs after the Award Date, before
the expiration date of this Option and during the
continuation of the Participant's Company Service (as
defined in Paragraph 7), this Option may first be
exercised (to the extent not already exercisable), in
whole or in part, after the date such Change in Control
occurs.
(b) By Whom Exercisable. During the Participant's lifetime, only
the Participant may exercise this Option. If the Participant
dies prior to the expiration date of this Option, without having
exercised this Option as to all of the Shares covered thereby,
this Option may be exercised, to the extent of the Shares with
respect to which this Option could have been exercised on the
date of the Participant's death, by the estate or a person who
acquired the right to exercise this Option by bequest or
inheritance from, or by reason of the death of, the Participant.
(c) Exercise. This Option shall be exercised by delivery on any
business day to the Company of a Notice of Exercise in the form
attached to this Agreement accompanied by payment of the Option
Price as provided in Paragraph 4 and payment in full, to the
extent required by Paragraph 12, of the amount of any tax the
Company is required to withhold as a result of such exercise.
4. Payment of Option Price. The Option Price will be payable in full
upon exercise of this Option to purchase Shares, and such Option Price
may be paid either in cash, or in Shares of Stock (which shall be
valued for such purpose at the mean between the high and low sales
price of such Stock as reported by the NASDAQ National Market System
for the date of exercise or, if not traded on the date of exercise, on
the most recent day on which the Stock was traded preceding the date
of exercise), or in a combination of cash and Stock. Payment
hereunder may also be made in accordance with any broker-assisted
cashless exercise procedures approved by the Company and as in effect
from time to time.
5. Transferability. This Option may not be transferred by the
Participant except by will or by the laws of descent and distribution.
6. Forfeiture. This Option shall be forfeited to the extent it is not
exercisable at the time of the Participant's cessation of Company
Service (as defined in Paragraph 7).
7. Company Service.
(a) For purposes hereof, "Company Service" means service as an
Employee and includes subsequent service as a member of the
Board of Directors of the Company or a Subsidiary, if any, as
provided in this paragraph. Notwithstanding any contrary
provision or implication herein, in determining cessation of
Company Service for purposes hereof, transfers between the
Company and/or any Subsidiary shall be disregarded and shall not
be considered a cessation of Company Service, and changes in
status between that of an Employee and a Non-Employee Director
shall be disregarded and shall not be considered a cessation of
Company Service.
(b) Nothing under the Plan or in this Agreement shall confer upon
the Participant any right to continue Company Service or in any
way affect any right of the Company to terminate the
Participant's Company Service without prior notice at any time
for any or no reason.
8. Compliance with Securities Laws. The Company covenants that it will
attempt to maintain an effective registration statement with the
Securities and Exchange Commission covering the Shares of Stock of the
Company, which are the subject of and may be issued pursuant to this
Agreement, at all times during which this Option is exercisable and
there is no applicable exemption from registration of such Shares;
provided, however, that this Option shall not be exercisable for Stock
at any time if its exercise would cause the Company to be in violation
of any applicable provisions of the federal or state securities law.
9. Administration of Plan. The Plan is administered by a Committee
appointed by the Company's Board of Directors. The Committee has the
authority to construe and interpret the Plan, to make rules of general
application relating to the Plan, to amend outstanding options, and to
require of any person exercising this Option, at the time of such
exercise, the execution of any paper or the making of any
representation or the giving of any commitment that the Committee
shall, in its discretion, deem necessary or advisable by reason of the
securities laws of the United States or any state, or the execution of
any paper or the payment of any sum of money in respect of taxes or
the undertaking to pay or have paid any such sum that the Committee
shall, in its discretion, deem necessary by reason of the Internal
Revenue Code or any rule or regulation thereunder or by reason of the
tax laws of any state. All such Committee determinations shall be
final, conclusive, and binding upon the Company and the Participant.
10. Capital Adjustments. The number of Shares of Stock covered by this
Option, and the Option Price thereof, will be subject to an
appropriate and equitable adjustment, as determined by the Committee,
to reflect any stock dividend, stock split, or share combination, and
will be subject to such adjustment as the Committee may deem
appropriate to reflect any exchange of shares, recapitalization,
merger, consolidation, separation, reorganization, liquidation, or the
like, of or by the Company.
11. Rights as a Shareholder. The Participant, or a transferee of this
Option, shall have no rights as a shareholder with respect to any
Shares subject to this Option until the date of the exercise of this
Option for such Shares. No adjustment shall be made for dividends
(ordinary or extraordinary, whether in cash, securities, or other
property) or distributions or other rights for which the record date
is prior to the date of such exercise, except as provided in Paragraph
10 hereof.
12. Withholding Taxes. The Company, or one of its Subsidiaries, shall
have the right to withhold any federal, state, or local taxes required
to be withheld by law with respect to the exercise of this Option.
The Participant will be required to pay the Company, as appropriate,
the amount of any such taxes which the Company, or one of its
Subsidiaries, is required to withhold. In lieu thereof, the Company
shall have the right to withhold from any other cash amounts due to or
to become due from the Company to the Participant an amount equal to
such taxes required to be withheld by the Company to reimburse the
Company for any such taxes; or to retain and withhold a number of
Shares of Stock having a Fair Market Value on the date of exercise not
less than the amount of such taxes, and cancel any such Shares so
withheld, in order to reimburse the Company for any such taxes.
13. Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of the Commonwealth of Virginia.
14. Successors. This Agreement shall be binding upon and inure to the
benefit of the successors, assigns, heirs, and legal representatives
of the respective parties.
15. Prohibition Against Pledge, Attachment, etc. Except as otherwise
provided herein, this Option, and the rights and privileges conferred
hereby, shall not be transferred, assigned, pledged, or hypothecated
in any way and shall not be subject to execution, attachment, or
similar process.
16. Intended to be an Incentive Stock Option. This Option is intended to
qualify as an incentive stock option within the meaning of Section
422(b) of the Internal Revenue Code, and the provisions hereof shall
be construed consistent with that intent. While it is intended that
this Option be treated as an incentive stock option within the meaning
of Section 422(b) of the Internal Revenue Code, the Company does not
guarantee such treatment. If, or to the extent, for any reason, this
Option is not treated as an incentive stock option within the meaning
of Section 422(b) of the Internal Revenue Code, this Option shall
nevertheless continue to otherwise be fully effective according to its
terms and the applicable terms of the Plan and shall be regarded as a
Non-Qualified Stock Option under the Plan.
17. Disqualifying Disposition of Stock Issued on Exercise of Incentive
Stock Option. If the Participant makes a "disposition" (within the
meaning of Section 424(c) of the Internal Revenue Code) of Shares of
Stock issued upon exercise of this Option within two years from the
Award Date or within one year from the date the Shares of Stock are
transferred to the Participant, the Participant agrees, within ten
days of disposition, to notify the Committee in order that any income
realized as a result of such disposition can be properly reported by
the Company or one of its Subsidiaries on IRS forms W-2 or 1099.
18. Capitalized Terms. Capitalized terms in this Agreement have the
meaning assigned to them in the Plan, unless this Agreement provides,
or the context requires, otherwise.
To evidence their agreement to the terms and conditions of this Option, the
Company and the Participant have signed this Agreement as of the date first
above written.
FNB CORPORATION By:________________________________
Its:_______________________________
PARTICIPANT: ___________________________________
{NAME}
NOTICE OF EXERCISE
FNB Corporation
000 Xxxxx Xxxxx
Xxxxxxxxxxxxxx, Xxxxxxxx 00000
Attention: Secretary
I hereby exercise my Option pursuant to that certain Incentive Stock Option
Agreement dated {DATE 1} (the "Stock Option Agreement") awarded under the FNB
Corporation 2006 Incentive Stock Plan (the "Plan"), subject to all of the
terms and conditions of the said Stock Option Agreement and the Plan referred
to therein, and hereby notify you of my election to purchase the following
stated number of Shares of Stock of FNB Corporation, a Virginia corporation
(the "Company"), from the award therein as indicated below at the following
stated Option Price per Share.
Number of Shares - Option Price per Share - $ Total Option Price - $
If this Notice of Exercise involves fewer than all of the Shares that are
subject to option under the said Stock Option Agreement, I retain the right to
exercise my option for the balance of the Shares remaining subject to option,
all in accordance with the terms of the said Stock Option Agreement.
I agree to provide the Company with such other documents and representations
as it deems appropriate in connection with this option exercise.
Payment of Exercise Price. This Notice of Exercise is accompanied by
[ ] (1) a check in the amount of $________ and/or [ ] (2) a certificate for
_________ Shares of Stock, with a duly executed stock power, having an
aggregate Fair Market Value on the date of exercise equal to the amount of the
above Total Option Price, in payment of the total exercise price for the
Shares.
Tax Withholding. Subject to any satisfaction of tax withholding pursuant to
the next paragraph, I hereby authorize the Company (and any of its
Subsidiaries) to withhold from my regular pay or any extraordinary pay from
the Company (and any of its Subsidiaries) the applicable minimum amount of
any taxes required by law and the said Stock Option Agreement to be withheld
as a result of this exercise, to the extent not satisfied by the following:
[ ] (1) my attached check in the amount of $________, and/or [ ] (2) the
attached certificate for _________ Shares of Stock, with a duly executed
stock power, having a value (based on the Stock's Fair Market Value on the
date of exercise) of $________ per Share in full or partial payment of taxes
the Company (and any of its Subsidiaries) is required to withhold with
respect to this option exercise.
[ ] [Check only if desired] I request that the Company withhold from the
Shares of Stock otherwise to be issued to me in connection with this exercise
a sufficient number of Shares of Stock having a value (based on the Stock's
Fair Market Value on the date of exercise) needed to satisfy the payment of
[ ] all or [ ] $________ of the applicable minimum amount of any taxes
required by law and the said Stock Option Agreement to be withheld as a
result of this exercise.
My current address and my Social Security Number are as follows:
Address: ______________________________________________
________________________________________________________
Social Security Number: _______________________________
Date: _______________ _______________________________
{NAME}
