EXHIBIT 4.2
IMPERIAL CREDIT INDUSTRIES, INC.
STOCK OPTION AGREEMENT
This AGREEMENT is made effective as of the ______ day of
_______________, (the "Option Grant Date"), by and between Imperial Credit
Industries, Inc., a California corporation (the "Company") and _________________
(the "Optionee").
RECITALS
WHEREAS, the Board of Directors of the Company has established the
1996 Stock Option, Deferred Stock and Restricted Stock Plan (the "Plan")
effective as of June 21, 1996, and
WHEREAS, pursuant to the provisions of said Plan, the Board of
Directors of the Company, by action duly taken on _____________, 199_, granted
to the Optionee an option or options (the "Option(s)") to purchase shares of the
Common Stock of the Company on the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants set forth herein and other good and valuable consideration, the
parties hereto agree as follows:
1. The Option(s). The Optionee may, at his option, purchase all or
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any part of an aggregate of _____________ shares of Common Stock (the "Optioned
Shares"), at the price of $_____ per share (the "Option Price"), on the terms
and conditions set forth herein.
2. Plan Type; Exercise Dates and Exercise. Options intended to
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qualify as Incentive Stock Options are designated by "IPO" under the category
"Plan." Options intended as separate Non-Qualified Stock Options are designated
by "NQO" under the category "Plan." The Option(s) shall be exercisable as to the
specified number of Optioned Shares on and after the "First" dates and on or
before the "Last" dates set forth below:
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Plan Number of Shares Exercise Dates
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First Last
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Optionee acknowledges that he understands he has no right whatsoever to exercise
the Option(s) granted hereunder with respect to any Optioned Shares covered by
any installment until such installment accrues as provided above. Optionee
further understands that the Option(s) granted hereunder shall expire and become
unexercisable as provided in Section 3(c) below.
This Option shall be deemed exercised as to the shares to be purchased when
written notice of such exercise has been given to the Company at its principal
business office by the Optionee with respect to the Common Stock to be
purchased. Such notice shall be accompanied by (i) full payment in cash or cash
equivalents, (ii) unrestricted Stock owned by the Optionee, or, in the case of
the exercise of a Non-Qualified Stock Option, Restricted Stock subject to an
Award (as defined in the Plan) under the Plan (based, in each case, on the Fair
Market Value of the Stock on the date the option is exercised), (iii) a full
recourse promissory note executed by the Optionee, (iv) cancellation of any
indebtedness owed by the Company to the Optionee, or (v) by any combination of
the foregoing as may be determined by the Committee with respect to the shares
to be purchased.
3. Governing Plan. This Agreement hereby incorporates by reference the
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Plan and all of the terms and conditions of the Plan as heretofore amended and
as the same may be amended from time to time hereafter in accordance with the
terms thereof, but no such subsequent amendment shall adversely affect the
Optionee's rights under this Agreement and the Plan except as may be required by
applicable law. The Optionee expressly acknowledges and agrees that the
provisions of this Agreement are subject to the Plan; the terms of this
Agreement shall in no manner limit or modify the controlling provisions of the
Plan, and in case of any conflict between the provisions of the Plan and this
Agreement, the provisions of the Plan shall be controlling and binding upon the
parties hereto. The Optionee also hereby expressly acknowledges, represents and
agrees as follows:
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(a) Acknowledges receipt of a copy of the Plan, a copy of which is
attached hereto and by reference incorporated herein, and represents that he is
familiar with the terms and provisions of said Plan, and hereby accepts this
Agreement subject to all the terms and provisions of said Plan.
(b) Agrees to accept as binding, conclusive and final all decisions
or interpretations of the Committee upon any questions arising under the Plan.
(c) Acknowledges that he is familiar with Sections of the Plan
regarding the exercise of the Option(s) and represents that he understands that
said Option(s) must be exercised on or before the earliest of the following
dates, whichever is applicable: (i) the "Last" exercise date noted above in
Section 2; (ii) the day prior to the fifth anniversary of the Option(s) Grant
Date with respect to Options granted as Incentive Stock Options and the day
prior to the tenth anniversary of the Option(s) Grant Date with respect to
Options granted as Non-Qualified Stock Options; (iii) the date which is the
earlier of (A) three months from the date of termination or (B) the expiration
of such Stock Option's term following the Optionee's termination of directorship
or consulting or other arrangement (unless extended) for any reason other than
death or disability as provided under Section 5 of the Plan; or (iv) the date
that is one year following the Optionee's termination of employment,
directorship or consulting or other arrangement by reason of his death, or the
date that is one year following his termination of employment, directorship or
consulting or other arrangement by reason of disability, whichever is
applicable, as provided in Subsections 5(g) and 5(h) of the Plan.
(d) Acknowledges, understands and agrees that the existence of the
Plan and the execution of this Agreement are not sufficient by themselves to
cause any exercise of any Option(s) granted as an Incentive Stock Option to
qualify for favorable tax treatment through the application of Section 422(A) of
the Internal Revenue Code; that Optionee must, in order to so qualify,
individually meet by his own action all applicable requirements of Section 422A,
including without limitation the following holding period and employment
requirements:
(1) holding period requirement: no disposition of an
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Optioned Share may be made by Optionee within two (2) years from the
date of the granting of the Option(s) nor within one (1) year after
the transfer of such Optioned Share to him, and
(2) employment requirement: at all times during the period
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beginning on the date of the granting of the Option(s) and ending on
the day three (3) months
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before the date of exercise, the Optionee must have been an employee
of the Company, its parent, or a subsidiary of the Company, or a
corporation or a parent or subsidiary of such corporation issuing or
assuming the Option(s) in a transaction to which Section 425(a) of the
Internal Revenue Code applies, except where the termination of
employment is by means of the employee's disability, in which case
said 3 month period may be extended to 1 year, as provided under
Internal Revenue Code Section 422A.
4. Representations and Warranties. As a condition to the exercise of
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any portion of an Option, the Company may require the person exercising such
Option to make any representation and/or warranty to the Company as may, in the
judgment of counsel to the Company, be required under any applicable law or
regulation, including but not limited to a representation and warranty that the
shares are being acquired only for investment and without any present intention
to sell or distribute such shares if, in the opinion of counsel for the Company,
such a representation is required under the Securities Act of 1933 or any other
applicable law, regulation or rule of any governmental agency. Optionee hereby
represents to the Company that each of the Option evidenced hereby and the
shares purchasable upon exercise thereof is being acquired only for investment
and without any present intention to sell or distribute such securities.
5. Options Not Transferable. The Option(s) may be exercised during
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the lifetime of the Optionee only by the Optionee. The Optionee's rights and
interests under this Agreement and in and to the Option(s) may not be sold,
pledged, hypothecated, assigned, encumbered, gifted or otherwise transferred in
any manner, either voluntarily or involuntarily by operation of law, except by
will or the laws of descent or distribution.
6. No Enlargement of Employee Rights. Nothing in this Agreement
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shall be construed to confer upon the Optionee (if an employee) any right to
continued employment with the Company, a Subsidiary, or to restrict in any way
the right of the Company, a Subsidiary, to terminate his employment. Optionee
acknowledges that in the absence of an express written employment agreement to
the contrary, Optionee's employment with the Company may be terminated by the
Company at any time, with or without cause.
7. Withholding of Taxes. Optionee authorizes the Company to
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withhold, in accordance with any applicable law, from any compensation payable
to him any taxes required to be withheld by federal, state or local law as a
result of the grant of the Option(s) or the issuance of stock pursuant to the
exercise of such Option(s).
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8. Laws Applicable to Construction. This Agreement shall be
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construed and enforced in accordance with the laws of the State of California.
9. Agreement Binding on Successors. The terms of this Agreement
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shall be binding upon the executors, administrators, heirs, successors,
transferees and assignees of the Optionee.
10. Costs of Litigation. In any action at law or in equity to enforce
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any of the provisions or rights under this Agreement or the Plan, the
unsuccessful party to such litigation, as determined by the court in a final
judgment or decree, shall pay the successful party or parties all costs,
expenses and reasonable attorneys' fees incurred by the successful party or
parties (including without limitation costs, expenses end fees on any appeals),
and if the successful party recovers judgment in any such action or proceeding
such costs, expenses and attorneys' fees shall be included as part of the
judgment.
11. Necessary Acts. The Optionee agrees to perform all acts and
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execute and deliver any documents that may be reasonably necessary to carry out
the provisions of this Agreement, including but not limited to all acts and
documents related to compliance with federal and/or state securities laws.
12. Counterparts. For convenience this Agreement may be executed in
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any number of identical counterparts, each of which shall be deemed a complete
original in itself and may be introduced in evidence or used for any other
purpose without the production of any other counterparts.
13. Invalid Provisions. In the event that any provision of this
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Agreement is found to be invalid or otherwise unenforceable under any applicable
law, such invalidity or unenforceability shall not be construed as rendering any
other provisions contained herein invalid or unenforceable, and all such other
provisions shall be given full force and effect to the same extent as though the
invalid and unenforceable provision was not contained herein.
14. Limitation on Value of Optioned Shares. Optionee acknowledged
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that the Plan provides that the aggregate fair market value (determined as of
the date hereof) of the shares of Common Stock to which Options granted as
Incentive Stock Options are exercisable for the first time by Optionee during
any calendar year under all incentive stock option plans of the Company and any
Subsidiary shall not exceed $100,000. It is understood and agreed that should
it be determined that an Option if granted as an Incentive Stock Option
hereunder would exceed such maximum, such
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Option shall be considered granted as a Non-Qualified Stock Option to the
extent, but only to the extent of such excess. This limitation shall not apply
to any option granted as a Non-Qualified Stock Option.
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IN WITNESS WHEREOF, the Company and the Optionee have executed this
Agreement effective as of the date first written hereinabove.
IMPERIAL CREDIT INDUSTRIES, INC. OPTIONEE
By:_______________________ _________________________
Name:
Title: _________________________
Street Address
_________________________
City and State
_________________________
Social Security No.
By his or her signature below, the spouse of the Optionee, of such
Optionee be legally married as of the date of his execution of this Agreement,
acknowledges that he or she has read this Agreement and the Plan and is familiar
with the terms and provisions thereof, and agrees to be bound by all the terms
and conditions of said Agreement and said Plan document.
___________________________________
Spouse
Dated: ____________________________
By his or her signature below the Optionee represents that he or she
is not legally married as of the date of execution of this Agreement.
___________________________________
Optionee
Dated: ____________________________
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