Exhibit 10(16)
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INCENTIVE STOCK OPTION AGREEMENT
UNDER THE LINCOLN BANCORP STOCK OPTION PLAN
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You are hereby granted the option to purchase a total of __________ shares
of the Common Stock, without par value ("Common Stock"), of Lincoln Bancorp
("LB") over the next ten years pursuant to LB's Stock Option Plan (the "Plan"),
on the following terms and conditions:
1. The purchase price of the shares of Common Stock subject to this option
is $________ per share. You must pay this purchase price in cash at the time
this option is exercised; provided, however that, with the approval of LB's
Stock Compensation Committee (the "Committee"), beginning on and after December
30, 2001, you may exercise your option by tendering to LB whole shares of LB's
Common Stock owned by you, or any combination of whole shares of LB's Common
Stock owned by you and cash, having a fair market value equal to the cash
exercise price of the shares with respect to which the option is exercised by
you. For this purpose, any shares so tendered shall be deemed to have a fair
market value equal to the mean between the highest and lowest quoted selling
prices for the shares on the date of exercise of the option (or if there were no
sales on such date the weighted average of the means between the highest and
lowest quoted selling prices on the nearest date before and the nearest date
after the date of exercise of the option), as reported in The Wall Street
Journal or a similar publication selected by the Committee. To exercise this
option, you must send written notice to the LB's Secretary at the address noted
in Section 12 hereof. Such notice shall state the number of shares in respect of
which the option is being exercised, shall identify the option exercised as an
incentive stock option, and shall be signed by the person or persons so
exercising the option. Such notice shall be accompanied by payment of the full
cash option price for such shares or, if the Committee has authorized the use of
the stock swap feature provided for above, such notice shall be followed as soon
as practicable by the delivery of the option price for such shares. Certificates
evidencing shares of Common Stock will not be delivered to you until payment has
been made. Under certain circumstances, the Plan permits you to deliver a notice
to your broker to deliver the cash to LB upon the receipt of such cash from the
sale of LB Common Stock. Contact the Secretary of LB for further information
about this procedure if you are interested in it.
2. The term of this option (the "Option Term") shall be for a period of ten
years from the date of this letter, subject to earlier termination as provided
in paragraphs 3 and 4 hereof. When the option becomes exercisable with respect
to any shares of Common Stock, those shares may be purchased at any time, or
from time to time, in whole or in part, until the Option Term expires, but in no
case may fewer than 100 such shares be purchased at any one time, except to
purchase a residue of fewer than 100 shares. Notwithstanding the foregoing or
any other provision herein, the option may not be exercised during the first six
months of the Option Term.
3. If you cease to be an employee of LB or any of its subsidiaries for any
reason other than retirement, permanent and total disability, or death, this
option shall forthwith terminate. If your employment by LB or any of its
subsidiaries is terminated by reason of retirement (which means such termination
of employment as shall entitle you to early or normal retirement benefits under
any then existing pension plan of LB or one of its subsidiaries), you may
exercise this option to the extent it was exercisable at the date of your
retirement in whole or in part within three years after such retirement, but not
later than the date upon which this option would otherwise expire; provided,
however, that if you are a director or a director emeritus at the time of your
retirement, you may exercise this option in whole or in part until the later of
(a) three years after your date of retirement or (b) six months after your
service as a director and/or director emeritus terminates, but not later than
the date upon which this option would otherwise expire. If you cease to be an
employee of LB or any of its subsidiaries because of your permanent and total
disability, you may exercise this option in whole or in part at any time within
one year after such termination of employment by reason of such disability, but
not later than the date upon which this option would otherwise expire.
4. If you die while employed by LB or any of its subsidiaries, within three
years after the termination of your employment because of retirement (or, if
later, six months following your termination of service as a director or
director emeritus of LB), or within one year after the termination of your
employment because of permanent and total disability, this option may be
exercised in whole or in part by your executor, administrator, or estate
beneficiaries at any time within one (1) year after the date of your death but
not later than the date upon which this option would otherwise expire.
5. This option is non-transferable otherwise than by will or the laws of
descent and distribution or pursuant to a qualified domestic relations order. It
may be exercised only by you or your guardian, if any, or, if you die, by your
executor, administrator, or beneficiaries of your estate who are entitled to
your option.
6. All rights to exercise this option will expire, in any event, ten years
from the date of this letter.
7. Certificates evidencing shares issued upon exercise of this option may
bear a legend setting forth among other things such restrictions on the
disposition or transfer of the shares of LB as LB may deem consistent with
applicable federal and state laws.
8. Nothing in this option shall restrict the right of LB or its
subsidiaries to terminate your employment at any time with or without cause.
9. This option is subject to all the terms, provisions and conditions of
the Plan, which is incorporated herein by reference, and to such regulations as
may from time to time be adopted by the Committee. A copy of the Plan has been
furnished to you and an additional copy may be obtained from LB. In the event of
any conflict between the provisions of the Plan and
the provisions of this letter, the terms, conditions and provisions of the Plan
shall control, and this letter shall be deemed to be modified accordingly.
10. This Stock Option Agreement is intended to grant an option which meets
all of the requirements of incentive stock options as defined in Section 422A of
the Internal Revenue Code. Subject to and upon the terms, conditions and
provisions of the Plan, each and every provision of this Agreement shall be
administered, construed and interpreted so that the option granted herein shall
so qualify as an incentive stock option. Each provision of this Stock Option
Agreement which would prevent this option from qualifying as an incentive stock
option, if any, shall be void.
11. You agree to advise LB immediately upon any sale or transfer of any
shares of Common Stock received upon exercise of this option to the extent such
sale or transfer takes place prior to the later of (a) two years from the date
of grant or (b) one year from the date of exercise of this option.
12. All notices by you to LB and your exercise of the option herein
granted, shall be addressed to Lincoln Bancorp, X.X. Xxx 000, 0000 Xxxx Xxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxx 00000, Attention: Secretary, or such other address
as LB may, from time to time, specify.
13. This option may not be exercised until LB has been advised by counsel
that all other applicable legal requirements have been met.
Very truly yours,
LINCOLN BANCORP
By:
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T. Xxx Xxxxx, President and
Chief Executive Officer
Accepted on the date above written
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