EXHIBIT 10.1
FORM OF
INCENTIVE STOCK OPTION AWARD AGREEMENT
OTTAWA SAVINGS BANCORP, INC.
2006 EQUITY INCENTIVE PLAN
This Award Agreement ("Agreement") is provided to ________________ (the
"Participant") by Ottawa Savings Bancorp, Inc. (the "Company") as of __________,
2006 (the "Grant Date"), the date the Compensation Committee of the Board of
Directors (the "Committee") granted the Participant the right and option to
purchase Shares pursuant to the Ottawa Savings Bancorp, Inc. 2006 Equity
Incentive Plan (the "Plan"), subject to the terms and conditions of the Plan and
this Agreement:
1. OPTION GRANT: You have been granted an INCENTIVE STOCK OPTION
(referred to in this Agreement as your "Option").
2. NUMBER OF SHARES
SUBJECT TO YOUR OPTION: ________ Shares (subject to adjustment as may be
necessary pursuant to the terms of the Plan).
3. GRANT DATE: ______________, 2006
4. EXERCISE PRICE: You may purchase Shares covered by your Option at a
price of $_______ PER SHARE.
Unless vested sooner pursuant to Section 2 of the attached Terms and
Conditions or otherwise in the discretion of the Committee, the Option will vest
(become exercisable) according to the following schedule:
Continuous Status Percentage of
as a Participant Option Vested/ Number of Shares
after Grant Date Number of Shares Available for Exercise Vesting Date
---------------- ---------------- ---------------------- ------------
Less than 1 year 0% [ ] -------
1 year 20% [ ] __________, 2007
2 years 40% [ ] __________, 2008
3 years 60% [ ] __________, 2009
4 years 80% [ ] __________, 2010
5 years 100% [ ] __________, 2011
IN WITNESS WHEREOF, Ottawa Savings Bancorp, Inc., acting by and through
the Committee, has caused this Agreement to be executed.
OTTAWA SAVINGS BANCORP, INC.
ACCEPTED BY PARTICIPANT: By: ________________________________
On behalf of the Committee
___________________________
[insert Participant's name]
___________________________
Date
TERMS AND CONDITIONS
1. GRANT OF OPTION. The Grant Date, Exercise Price and number of Shares
subject to your Option are stated on page 1 of this Agreement.
Capitalized terms used in this Agreement and not otherwise defined have
the same meanings assigned to such terms by the Plan. The Company
intends this grant to qualify as an Incentive Stock Option.
2. VESTING OF OPTIONS. The Option will vest (become exercisable) according
to the schedule shown on page 1 of this Agreement. Notwithstanding the
vesting schedule on page 1, however, the Option will also vest and
become exercisable:
(a) Upon your death or Disability during your Continuous Status as
a Participant; or
(b) Upon a Change in Control.
3. TERM OF OPTIONS AND LIMITATIONS ON RIGHT TO EXERCISE. The Option term
will be for a period of ten (10) years, expiring at 5:00 p.m., Central
Time, on the tenth anniversary of the Grant Date (the "Expiration
Date"). To the extent not previously exercised, the vested Options will
lapse prior to the Expiration Date upon the earliest to occur of the
following:
(a) Three (3) months after termination of your Continuous Status
as a Participant for any reason other than death or
Disability;
(b) Twelve (12) months after termination of your Continuous Status
as a Participant by reason of Disability;
(c) Twelve (12) months after the date of your death, if you die
while employed, or during the three-month period described in
subsection (a) above or during the twelve-month period
described in subsection (b) above and before the Options
otherwise lapse. Upon your death, a beneficiary designated
pursuant to the Plan may exercise the Options; or
(d) At the end of the remaining original term of the Option, if
your employment is involuntarily or constructively terminated
within twelve (12) months of a Change in Control. Please note
that Options exercised more than three (3) months after your
termination of employment will be treated as Non-Statutory
Stock Options for tax purposes.
Prior to the lapse of the Options under the circumstances described in
paragraphs (a), (b), (c) or (d) above, the Committee may extend the
time to exercise the Options as determined in writing. If you return to
employment with the Company during the designated post-termination
exercise period, you will be restored to the status held prior to
termination but no vesting credit will be earned for any period you
were not in Continuous Status as a Participant. If you or your
beneficiary exercises an Option after termination of service, the
Option may be exercised only with respect to the Shares that were
otherwise vested on the date of your termination of service.
4. EXERCISE OF OPTION. You may exercise your Option by providing:
(a) a written notice of intent to exercise to ___________ in the
Human Resources Department at the address and in the form
specified by the Company from time to time; and
(b) payment to the Company in full for the Shares subject to such
exercise (unless the exercise is a cashless exercise). Payment
for the Shares may be made in cash, Company common stock ("stock
swap"), a combination of cash and Company common stock or a
"cashless exercise" (if permitted by the Committee).
5. BENEFICIARY DESIGNATION. You may designate a beneficiary to exercise
your rights under the Plan and receive any distribution with respect to
the Option upon your death. Your beneficiary and any legal
representative or other person claiming rights under the Plan is
subject to all terms and conditions of this Agreement and the Plan, and
to any additional restrictions deemed necessary or appropriate by the
Committee. If you do not designate a beneficiary or none survives you,
the legal representative of your estate may exercise the Option. You
may change or revoke a beneficiary designation at any time by filing
the change or revocation with the Company.
6. TAXES/WITHHOLDING.
(a) EXERCISE OF INCENTIVE
STOCK OPTION:
Generally, there are no regular
federal or state income or
employment tax liabilities upon the
exercise of an Incentive Stock
Option (SEE "INCENTIVE STOCK OPTION
HOLDING PERIOD" BELOW), although the
excess, if any, of the Fair Market
Value of the shares of Common Stock
on the date of exercise over the
Option Price will be treated as
income for alternative minimum tax
("AMT") purposes and may subject you
to AMT in the year of exercise.
Please check with your tax advisor.
(b) DISQUALIFYING DISPOSITION:
In the event of a disqualifying
disposition (described below), you
may be required to pay the Company
or its Affiliates (based on the
federal and state regulations in
place at the time of exercise) an
amount sufficient to satisfy all
federal, state and local tax
withholding.
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(c) INCENTIVE STOCK OPTION HOLDING PERIOD:
In order to receive Incentive Stock
Option tax treatment as described
above, you may not dispose of shares
acquired under an Incentive Stock
Option for (i) two (2) years from
the Grant Date and (ii) one (1) year
from the date you exercise the
Option.
7. LIMITATION OF RIGHTS. This Option does not provide you or your
beneficiary with any shareholder rights unless and until you or your
beneficiary receives Shares of Company stock in connection with an
Option exercise. Nothing in this Agreement will interfere with or limit
in any way the right of the Company or any Affiliate to terminate your
employment or service at any time.
8. STOCK RESERVE. The Company shall at all times during the term of this
Agreement reserve and keep available a sufficient number of Shares to
satisfy the requirements of this Agreement.
9. RESTRICTIONS ON TRANSFER AND PLEDGE. You may not pledge, encumber,
transfer or hypothecate your rights or interests in the Option to or in
favor of any party other than the Company or an Affiliate, and your
Option may not become subject to any lien, obligation, or liability to
any other party other than the Company or an Affiliate. You may not
transfer or assign the Option, other than by will or the laws of
descent and distribution or pursuant to a domestic relations order that
would satisfy Section 414(p)(1)(A) of the Code as applied to an Option
under the Plan; provided, however, that the Committee may (but need
not) permit other transfers. Only you or a permitted transferee may
exercise the Option during your lifetime.
10. PLAN CONTROLS. The terms of the Plan are incorporated into and made a
part of this Agreement. In the event of any actual or alleged conflict
between the provisions of the Plan and the provisions of this
Agreement, the provisions of the Plan shall control.
11. SUCCESSORS. This Agreement will be binding upon any successor to the
Company, in accordance with the terms of the Agreement and the Plan.
12. SEVERABILITY. If any provision of this Agreement is invalid, illegal or
unenforceable, the other provisions of the Agreement will be construed
and enforced as if the invalid, illegal or unenforceable provision was
never included in the Agreement.
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13. NOTICE. Notices and communications under this Agreement must be in
writing and either personally delivered or sent by registered or
certified United States mail, return receipt requested, postage
prepaid. Notices to the Company must be addressed to:
Ottawa Savings Bancorp, Inc.
000 Xx Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Compensation Committee of the Board of Directors
c/o Human Resources Department
or any other address designated by the Company in a written notice to
you. The Company will direct notices to you at your address as then
currently on file with the Company, or at any other address that you
provide in a written notice to the Company.
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