EXHIBIT 4.3
U.S.B. HOLDING CO., INC., 2005 EMPLOYEE STOCK OPTION PLAN
STOCK OPTION AGREEMENT
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NAME OF OPTIONEE SOCIAL SECURITY NUMBER
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STREET ADDRESS
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CITY STATE ZIP CODE
This Stock Option Agreement is intended to set forth the terms and conditions on
which a Stock Option has been granted under the U.S.B. Holding Co., Inc., 2005
Employee Stock Option Plan. Set forth below are the specific terms and
conditions applicable to this Stock Option. Attached as Exhibit A are its
general terms and conditions.
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Option Grant (A) (B)
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Grant Date:
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Class of Optioned Shares* Common
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No. of Optioned Shares*
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Exercise Price Per Share*
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Option Type (ISO or NQSO)
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VESTING
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Vesting Date*
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Option Expiration Date*
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* SUBJECT TO ADJUSTMENT AS PROVIDED IN THE PLAN AND THE GENERAL TERMS AND
CONDITIONS.
By signing where indicated below, U.S.B. Holding Co., Inc. (the "Company")
grants this Incentive Stock Option or Non-Qualified Stock Option upon the
specified terms and conditions, and the Optionee acknowledges receipt of this
Option, including Exhibit A, and agrees to observe and be bound by the terms and
conditions set forth herein.
U.S.B. HOLDING CO, INC. OPTIONEE
By
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NAME: XXXXXX X. XXXXX
TITLE: CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
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INSTRUCTIONS: This page should be completed by or on behalf of the Committee.
Any blank space intentionally left blank should be crossed out. An option grant
consists of a number of optioned shares with uniform terms and conditions. Where
options are granted on the same date with varying terms and conditions (for
example, varying exercise prices or earliest exercise dates), the options should
be recorded as a series of grants each with its own uniform terms and
conditions.
EXHIBIT A
U.S.B. HOLDING CO., INC., 2005 EMPLOYEE STOCK OPTION PLAN
STOCK OPTION AGREEMENT
GENERAL TERMS AND CONDITIONS
SECTION 1. INCENTIVE STOCK OPTION. If the Option is designated as an
ISO, the Company intends the Option evidenced hereby to be an "incentive stock
option" within the meaning of section 422 of the Internal Revenue Code of 1986
("Code"). If the Option or any part of the Option does not qualify as an
"incentive stock option" under the Plan or the Code, the Option or the part not
qualifying shall be treated as a Non-Qualified Stock Option under the Code.
SECTION 2. OPTION PERIOD. (a) Subject to section 2(b), the Optionee
shall have the right to exercise an option, in whole or in part, at such time or
times as the Committee shall determine as specified in this agreement and
subject to the ending dates in this Section (the "Option Period"). The Committee
may also, in its discretion, accelerate the exercisability of any option at any
time. The Option Period commences on the Vesting Date, and ends on the earliest
to occur of the following dates:
(i) the close of business on the last day of the
three (3) months after the Optionee's termination of service
(including retirement) for reasons other than death,
disability, voluntary resignation or a termination for cause;
(ii) the close of business on the last day one year
after the Optionee's termination of service for reasons of
death or twelve months after termination service for reasons
of disability;
(iii) the date and time of termination for cause or
voluntary resignation (excluding retirement); or
(iv) the last day of the ten-year period commencing
on the date on which the Option was granted.
(b) If the Option is designated as an ISO, the favorable tax
treatment applicable to incentive stock options may not apply if it is
exercisable more than three months after your termination of employment for
reasons other than total and permanent disability (within this meaning of
section 22(e)(3) of the Code) or more than one year after your termination of
employment due to total and permanent disability.
(c) Upon the termination of the Optionee's service with the Company other than
for reasons of death or disability, any Option granted hereunder whose Earliest
Exercise Date has not occurred is deemed forfeited, unless the Committee, in its
sole discretion, deems otherwise. In the event of death or disability, and in
the event of a Change in Control, any unvested Options evidenced by this
Agreement that have not previously vested will immediately vest.
SECTION 3. EXERCISE PRICE. During the Option Period, and after the
applicable Earliest Exercise Date, the Optionee shall have the right to purchase
all or any portion of the optioned Common Stock at the Exercise Price per Share.
SECTION 4. METHOD OF EXERCISE. The Optionee may, at any time during the
Option Period provided by section 2, exercise his right to purchase all or any
part of the optioned Common Stock then available for purchase; PROVIDED,
HOWEVER, that a minimum number of shares of optioned Common Stock which may be
purchased may be designated by the Committee in its sole discretion. The
Optionee shall exercise such right by:
(a) giving written notice to the U.S.B. Holding Co. in the
form attached hereto as Appendix A; and
(b) delivering to the Committee full payment of the Exercise
Price for the optioned Common Stock to be purchased.
The date of exercise shall be the earliest date practicable following the date
the requirements of Section 4 of this Agreement have been satisfied. Payment for
the shares issuable upon exercise of the option shall be made in full in cash,
personal check, or by certified check or by tendering (either physically or by a
constructive delivery method acceptable to the Committee) shares owned by the
Optionee for a period of more than six months (valued at fair market value on
the date of exercise). If this Option is designated as an ISO, each Optionee who
receives Stock upon exercise of an Option that is an Incentive Stock Option
shall give the Company prompt notice of any sale of Stock prior to the
expiration of any applicable holding period for the Incentive Stock Options
prescribed by the Code.
SECTION 5. DELIVERY AND REGISTRATION OF OPTIONED SHARES. As soon as
reasonably practicable following the date on which the Optionee has satisfied
the requirements of section 4, a certificate representing the shares purchased,
registered in the name of the Optionee, shall be delivered to the Optionee or
book entry shares shall be delivered for the account of the optionee in
accordance with such instructions as the Optionee may provide. The Optionee
shall have no right to vote or to receive dividends, nor have any other rights
with respect to optioned Common Stock, prior to the date as of which such
optioned Common Stock is transferred to the Optionee on the stock transfer
records of the Company, 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. The obligation of the Company to deliver Common Stock
under this Agreement shall, if the Committee so requests, be conditioned upon
the receipt of a representation as to the investment intention of the person to
whom such Common Stock is 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 Common Stock
or upon the occurrence of any other event eliminating the necessity of such
representation. The Company shall not be required to deliver any Common Stock
under this Agreement prior to (a) the admission of such Common Stock to listing
on any stock exchange on which Common Stock 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. ADJUSTMENTS IN THE EVENT OF REORGANIZATION. Unless otherwise
determined by the Committee, in the event of a merger of the Company with or
into another corporation, or the sale of substantially all of the assets of the
Company, each outstanding Option shall be assumed or an equivalent option or
right substituted by the successor corporation or a parent or Subsidiary of the
successor corporation. In the event that the successor corporation refuses to
assume or substitute for the Option, the Optionee shall fully vest in and have
the right to exercise the Option as to all of the Optioned Stock, including
Shares as to which it would not otherwise be vested or exercisable. If an Option
becomes fully vested and exercisable in lieu of assumption or substitution in
the event of a merger or sale of assets, the Committee shall notify the Optionee
in writing or electronically that the Option shall be fully vested and
exercisable for a period of thirty (30) days from the date of such notice, and
the Option shall terminate upon the expiration of such period. For the purposes
of this paragraph, the Option shall be considered assumed if, following the
merger or sale of assets, the Option or right confers the right to purchase or
receive, for each Share of Optioned Stock subject to the Option immediately
prior to the merger or sale of assets, the consideration (whether stock, cash,
or other securities or property) received in the merger or sale of assets by
holders of Stock for each Share held on the effective date of the transaction
(and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the merger or sale of
assets is not solely common stock of the successor corporation or its parent,
the Committee may, with the consent of the successor corporation, provide for
the consideration to be received upon the exercise of the Option for each Share
of Optioned Stock subject to the Option to be solely common stock of the
successor corporation or its parent equal in fair market value to the per Share
consideration received by holders of Stock in the merger or sale of assets.
In the event of a stock split, reverse stock split, stock dividend,
combination or reclassification of Shares without the receipt of consideration
by the Company, or other similar event (including a spinoff transaction) the
number of Shares covered by each outstanding Option, and its exercise price,
shall be proportionately adjusted in such manner as the Committee may determine
to be necessary to prevent the enlargement or diminution of rights.
SECTION 7. NO RIGHT TO CONTINUED SERVICE. 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 Optionee any right to a continuation of
service by the Company. The Optionee may be dismissed or otherwise dealt with as
though this Agreement had not been entered into.
SECTION 8. TAXES. Where any person is entitled to receive shares
pursuant to the exercise of the Option granted hereunder, the Company shall have
the right to require such person to pay to the Company the amount of any tax
which the Company 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.
SECTION 9. 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:
U.S.B. Holding Co., Inc.
000 Xxxxx Xxxx Xxxx,
Xxxxxxxxxx, Xxx Xxxx 00000
Attention: CHIEF FINANCIAL OFFICER - STOCK OPTION PLANS
(b) If to the Optionee, to the Optionee's address as shown in
the Company's personnel records.
SECTION 10. RESTRICTIONS ON TRANSFER. No Option granted hereunder may
be transferred, assigned, pledged or hypothecated (whether by operation of law
or otherwise), except as provided by will or the applicable laws of descent and
distribution, and no Option shall be subject to execution, attachment or similar
process. Any attempted assignment, transfer, pledge, hypothecation or other
disposition of an Option not specifically permitted herein shall be null and
void and without effect. An Option may be exercised by an Optionee only during
his or her lifetime, or following his or her death pursuant to Article 12 of the
Plan. To name a Beneficiary who may exercise your Options following your death,
complete the attached Appendix B and file it with the Corporate Secretary of
U.S.B. Holding Co., Inc.
Notwithstanding the foregoing, the Committee may permit the person to
whom an Option is initially granted to transfer a vested Non-Qualified Stock
Option, in whole or in part, to the lineal ascendants and lineal descendants of
such person or his spouse, or any one or more of them, or to an entity wholly
owned by, including, but not limited to, a trust the exclusive beneficiaries of
which are one or more of the lineal ascendents and lineal descendants of such
person or his spouse, or wholly owned jointly by one or more of them and such
person. If such transfer is approved, it shall be effected by written notice to
the Company given in such form and manner as the Committee may prescribe and
actually received by the Company prior to the death of the person giving it.
Thereafter, the transferee shall have with respect to such Non-Qualified Stock
Option, all of the rights, privileges and obligations which would attach
thereunder to the transferor. If a privilege of the Option depends on the life,
employment or other status of the transferor, such privilege of the Option for
the transferee shall continue to depend upon the life, employment or other
status of the transferor. The Committee shall have full and exclusive authority
to interpret and apply the provisions of the Plan to transferees to the extent
not specifically addressed herein.
SECTION 11. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and shall be binding upon the Company and the Optionee and their
respective heirs, successors and assigns.
SECTION 12. 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 13. GOVERNING LAW. To the extent not preempted by federal law,
the Plan, and all Agreements hereunder, shall be construed in accordance with
and governed by the laws of the State of New York applicable to contracts
entered into and to be performed within the State of New York by parties each of
whom is a New York State resident. The federal and state courts located in the
Counties of Rockland, Orange, Westchester, or New York shall have exclusive
jurisdiction over any claim, action, complaint or lawsuit brought under the
terms of the Plan or in relation to any action taken or omitted under the Plan
or any Option granted under the Plan. By accepting any Option granted under this
Plan, the Optionee, and any other person claiming any rights under the Plan,
agrees to submit himself, and any such legal action as he shall bring under the
Plan, to the sole jurisdiction of such courts for the adjudication and
resolution of any such disputes.
SECTION 14. AMENDMENT. The Board may suspend, terminate, modify or
amend the Plan, in whole or in part, provided that any amendment that would (i)
materially increase the aggregate number of Shares which may be issued under the
Plan, (ii) materially modify the requirements as to eligibility for
participation in the Plan or (iii) reduce the exercise price of Options
previously granted under the Plan shall be subject to the approval of the
Company's stockholders, except that any such increase, modification or reduction
that may result from adjustments authorized by Article 13 does not require such
approval. If the Plan is terminated, the terms of the Plan shall,
notwithstanding such termination, continue to apply to awards granted prior to
such termination. No suspension, termination, modification or amendment of the
Plan may, without the consent of the Optionee to whom an award shall theretofore
have been granted, adversely affect the rights of such Optionee under such
award.
SECTION 15. 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
Optionee acknowledges receipt of a copy of the Plan.
APPENDIX A
U.S.B. HOLDING CO., INC., 2005 EMPLOYEE STOCK OPTION PLAN
NOTICE OF EXERCISE OF STOCK OPTION
USE THIS NOTICE TO INFORM THE COMMITTEE ADMINISTERING THE U.S.B. HOLDING CO.,
INC., 2005 EMPLOYEE STOCK OPTION PLAN ("PLAN") THAT YOU ARE EXERCISING YOUR
RIGHT TO PURCHASE SHARES OF COMMON STOCK ("SHARES") OF U.S.B. HOLDING CO., INC.
("USB") PURSUANT TO AN 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
STOCK OPTION AGREEMENT ENTERED INTO BETWEEN USB AND THE OPTION RECIPIENT
("AGREEMENT"). THIS NOTICE SHOULD BE PERSONALLY DELIVERED OR MAILED BY CERTIFIED
MAIL, RETURN RECEIPT REQUESTED TO: U.S.B. HOLDING CO., INC., 000 XXXXX XXXX
XXXX, XXXXXXXXXX, XXX XXXX 00000, ATTENTION: CHIEF FINANCIAL OFFICER - STOCK
OPTION PLANS. THE EFFECTIVE DATE OF THE EXERCISE OF THE OPTION SHALL BE THE
EARLIEST DATE REASONABLY PRACTICABLE FOLLOWING THE DATE THIS NOTICE IS RECEIVED
BY USB ("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.
OPTION INFORMATION - IDENTIFY BELOW THE OPTION THAT YOU ARE EXERCISING BY
PROVIDING THE FOLLOWING INFORMATION FROM THE STOCK OPTION AGREEMENT.
NAME OF OPTIONEE: ______________________________________________
OPTION GRANT DATE:_______________, ______ EXERCISE PRICE PER SHARE: $_______.__
(MONTH AND DAY) (YEAR)
EXERCISE PRICE - COMPUTE THE EXERCISE PRICE BELOW AND SELECT A METHOD OF
PAYMENT.
TOTAL EXERCISE PRICE ________________ x $___________.__ = $______________
(No. of Shares) (Exercise Price) Total Exercise
Price
METHOD OF PAYMENT
|_| I enclose a certified check, money order, or bank $____________
draft payable to the order of U.S.B. Holding Co.,
Inc. in the amount of
|_| I enclose Shares* duly endorsed for transfer to $____________
U.S.B. Holding Co., Inc. with all stamps attached
and having a fair market value of
|_| I authorize the transfer of ______________ shares* $____________
of U.S.B. Holding Co., Inc. from my account at
____________, account number ____________ to pay
for this exercise with a fair market value of
* - Shares must be owned for a period of at least six months.
ISSUANCE OF CERTIFICATES
I hereby direct that the stock certificates representing the Shares
purchased pursuant to section 2 above be issued to the following
person(s) in the amount specified below:
NAME AND ADDRESS SOCIAL SECURITY NO. NO OF SHARES
- -
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PAGE 1
WITHHOLDING ELECTIONS - FOR EMPLOYEE OPTION RECIPIENTS WITH NON-QUALIFIED STOCK
OPTIONS ONLY. BENEFICIARIES AND OUTSIDE DIRECTORS 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 USB 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]:
|_| With a certified or bank check that I will deliver to
the Administrator on the day after the Effective Date
of my Option exercise
|_| With shares, previously owned for a period of at
least six months, duly endorsed for transfer to
U.S.B. Holding Co., Inc.
|_| Retain 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 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.
COMPLIANCE WITH TAX AND SECURITIES LAWS
S H I understand that I must rely on, and consult with, my own tax and
legal counsel (and not U.S.B. Holding Co., Inc.) regarding the
I E application of all laws -- particularly tax and securities laws -- to
the transactions to be effected pursuant to my Option and this Notice.
G R 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
N E 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.
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Signature Date
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Address
INTERNAL USE ONLY
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CHIEF FINANCIAL OFFICER - STOCK OPTION PLANS
RECEIVED - DATE______________ BY HAND__________ BY MAIL POST
MARKED__________________________
BY____________________________________ __________________
AUTHORIZED SIGNATURE DATE
PAGE 2
APPENDIX B
U.S.B. HOLDING CO., INC., 2005 EMPLOYEE STOCK OPTION PLAN
BENEFICIARY DESIGNATION FORM
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GENERAL USE THIS FORM TO DESIGNATE THE BENEFICIARY(IES) WHO MAY EXERCISE
INFORMATION OPTIONS OUTSTANDING TO YOU AT THE TIME OF YOUR DEATH.
Name of Person
Making Designation ______________________ Social Security Number ____--___--____
BENEFICIARY COMPLETE SECTIONS A AND B. IF NO PERCENTAGE SHARES ARE
DESIGNATION SPECIFIED, EACH BENEFICIARY IN THE SAME CLASS (PRIMARY OR
CONTINGENT) SHALL HAVE AN EQUAL SHARE. IF ANY DESIGNATED
BENEFICIARY PREDECEASES YOU, THE SHARES OF EACH REMAINING
BENEFICIARY IN THE SAME CLASS (PRIMARY OR CONTINGENT) SHALL BE
INCREASED PROPORTIONATELY.
A PRIMARY BENEFICIARY(IES). I hereby designate the following person as my
primary Beneficiary under the Plan, reserving the right to change or revoke this
designation at any time prior to my death:
NAME ADDRESS RELATIONSHIP BIRTHDATE SHARE
________________________ ___________________ ____________ _________ ______%
___________________
________________________ ___________________ ____________ _________ ______%
___________________
________________________ ___________________ ____________ _________ ______%
___________________ Total = 100%
B CONTINGENT BENEFICIARY(IES). I hereby designate the following person(s) as my
contingent Beneficiary(ies) under the Plan to receive benefits only if all of my
primary Beneficiaries should predecease me, reserving the right to change or
revoke this designation at any time prior to my death as to all outstanding
Options:
NAME ADDRESS RELATIONSHIP BIRTHDATE SHARE
________________________ ___________________ ____________ _________ ______%
___________________
________________________ ___________________ ____________ _________ ______%
___________________
________________________ ___________________ ____________ _________ ______%
___________________ Total = 100%
S H I understand that this Beneficiary Designation shall be effective only
I E if properly completed and received by the Corporate Secretary of U.S.B.
G R Holding Co., Inc. prior to my death, and that it is subject to all of
N E the terms and conditions of the Plan. I also understand that an
effective Beneficiary designation revokes my prior designation(s) with
respect to all outstanding Options.
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YOUR SIGNATURE DATE
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--------------------------------INTERNAL USE ONLY-------------------------------
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This Beneficiary Designation was received Comments
by the Corporate Secretary of U.S.B. Holding
Co., Inc. on the date indicated.
By
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AUTHORIZED SIGNATURE DATE
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