Exhibit 10.4
CENTURY BANCORP, INC.
2004 STOCK PLAN
Amended and Restated as of
December 30, 2005

1.   PURPOSE

     The purpose of the Century Bancorp, Inc. 2004 Stock Plan is to encourage
ownership of Class A common stock of the Company by directors, officers and
employees of the Company and its Affiliates and to provide additional incentives
for them to promote the success of the Company’s business through awards of or
relating to shares of the Company’s Class A common stock. The 2004 Stock Plan is
intended to be an incentive stock option plan within the meaning of Section 422
of the Code, but not all Options granted hereunder are required to be Incentive
Options.

2.   DEFINITIONS

     As used in this Plan the following terms shall have the respective meanings
set out below, unless the context clearly requires otherwise:
     2.1. Affiliate means any corporation, partnership, limited liability
company, business trust, or other entity controlling, controlled by or under
common control with the Company.
     2.2. Award means any grant of Options, grant of Stock Appreciation Rights
or award of Restricted Stock pursuant to the Plan.
     2.3. Award Agreement means an agreement between the Company and the
recipient of an Award, setting forth the terms and conditions of the Award.
     2.4. Board means the Company’s Board of Directors.
     2.5. Change of Control means the occurrence of any of the following:
          (a) a merger or consolidation of the Company with or into another
person or the sale, transfer or other disposition of all or substantially all
the Company’s assets to one or more persons in a single transaction or a series
of related transactions, unless securities possessing more than 50% of the total
combined voting power of the survivor’s or acquiror’s outstanding securities (or
the securities of any parent thereof) are held by a person or persons who held
securities possessing more than 50% of the total combined voting power of the
Company’s outstanding securities immediately prior to that transaction, or
          (b) any person or group of persons (within the meaning of
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended and in
effect from time to time), directly or indirectly acquires beneficial ownership
(determined pursuant to Securities and Exchange Commission Rule 13d-3) of
securities possessing more than 20% of the total combined voting power of the
Company’s outstanding securities pursuant to a tender or exchange offer made
directly to the Company’s stockholders that the Board does not recommend the
stockholders accept, other than (i) the Company or an Affiliate, (ii) an

 

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employee benefit plan of the Company or any of its Affiliates, (iii) a trustee
or other fiduciary holding securities under an employee benefit plan of the
Company or any of its Affiliates, or (iv) an underwriter temporarily holding
securities pursuant to an offering of such securities, or
          (c) over a period of 36 consecutive months or less, there is a change
in the composition of the Board such that a majority of the Board members
(rounded up to the next whole number, if a fraction) ceases, by reason of one or
more proxy contests for the election of Board members, to be composed of
individuals who either (i) have been Board members continuously since the
beginning of that period, or (ii) have been elected or nominated for election as
Board members during such period by at least a majority of the Board members
described in the preceding clause (i) who were still in office at the time that
election or nomination was approved by the Board; or
          (d) a majority of the Board votes in favor of a decision that a Change
in Control has occurred.
     2.5. Class A Common Stock means Class A common stock, par value $1.00 per
share, of the Company.
     2.6. Code means the Internal Revenue Code of 1986, as amended from time to
time, or any statute successor thereto, and any regulations issued from time to
time thereunder.
     2.7. Company means Century Bancorp, Inc., a corporation organized under the
laws of the Commonwealth of Massachusetts.
     2.8. Compensation Committee means the Compensation Committee of the Board
or any other committee of the Board to which the Board has delegated
responsibility for the administration of the Plan.
     2.9. Grant Date means the date as of which an Award is granted.
     2.10. Incentive Option means an Option which by its terms is to be treated
as an “incentive stock option” within the meaning of Section 422 of the Code.
     2.11. Market Value means the value of a share of Class A Common Stock on
any date as determined by the Compensation Committee.
     2.12. Nonstatutory Option means any Option that is not an Incentive Option.
     2.13. Option means an option to purchase shares of Class A Common Stock.
     2.14. Optionee means a Participant to whom an Option shall have been
granted under the Plan.
     2.15. Participant means any holder of an outstanding Award under the Plan.
     2.16. Plan means this 2004 Stock Plan of the Company, as amended from time
to time.
     2.17. Restricted Stock means a grant or sale of shares of Class A Common
Stock to a Participant subject to a Risk of Forfeiture.
     2.18. Restriction Period means the period of time, established by the
Compensation Committee in connection with an Award of Restricted Stock, during
which the shares of Restricted Stock are subject to a Risk of Forfeiture
described in the applicable Award Agreement.

 

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     2.19. Risk of Forfeiture means a limitation on the right of the Participant
to retain Restricted Stock, including a right in the Company to reacquire shares
of Restricted Stock at less than their then Market Value, arising because of the
occurrence or non-occurrence of specified events or conditions.
     2.20. Stock Appreciation Right means a right to receive any excess in the
Market Value of shares of Class A Common Stock over a specified exercise price.
     2.21. Ten Percent Owner means a person who owns, or is deemed within the
meaning of Section 422(b)(6) of the Code to own, stock possessing more than 10%
of the total combined voting power of all classes of stock of the Company (or
any Affiliate). Whether a person is a Ten Percent Owner shall be determined with
respect to each Option based on the facts existing immediately prior to the
Grant Date of that Option.

3.   TERM OF THE PLAN

     Unless the Plan shall have been earlier terminated by the Board, Awards may
be granted hereunder at any time in the period commencing on the approval of the
Plan by the Company’s Class B stockholders and ending immediately prior to the
tenth anniversary of the earlier of the adoption of the Plan by the Board or
approval of the Plan by the Company’s Class B stockholders. Awards granted
pursuant to the Plan within such period shall not expire solely by reason of the
termination of the Plan.

4.   STOCK SUBJECT TO THE PLAN

     At no time shall the number of shares of Class A Common Stock issued
pursuant to or subject to outstanding Awards granted under the Plan exceed
150,000 shares of Class A Common Stock, subject, however, to the provisions of
Section 10 of the Plan. For purposes of applying the foregoing limitation, if
any Option or Stock Appreciation Right expires, terminates or is cancelled for
any reason without having been exercised in full, the shares as to which the
Option or Stock Appreciation Right was not exercised shall again be available
for Awards thereafter to be granted under the Plan, and if any Restricted Stock
is forfeited, the shares so forfeited shall again be available for Awards
thereafter to be granted under the Plan. Shares of Class A Common Stock issued
pursuant to the Plan may be either authorized but unissued shares or shares held
by the Company in its treasury.

5.   ADMINISTRATION

     The Plan shall be administered by the Compensation Committee. Subject to
the provisions of the Plan, the Compensation Committee shall have complete
authority, in its discretion, to make or to select the manner of making all
necessary determinations with respect to each Award to be granted by the Company
under the Plan in addition to any other determination allowed the Compensation
Committee under the Plan including the director, employee or officer to receive
the Award. In making such determinations, the Compensation Committee may take
into account the nature of the services rendered by the respective employees,
officers, and directors, their present and potential contributions to the
success of the Company and its subsidiaries, and such other factors as the
Compensation Committee in its discretion shall deem relevant. Subject to the
provisions of the Plan, the Compensation Committee shall also have complete
authority to interpret the Plan, to prescribe, amend and rescind rules and
regulations relating to it, to determine the terms and provisions of the
respective Award Agreements (which need not be identical), and to make all other
determinations necessary or advisable for the administration of the Plan. The
Compensation Committee’s determinations made in good faith on matters referred
to in this Plan shall be conclusive. Without in any way limiting the foregoing,
the Compensation Committee shall at the time each Option is granted designate
such Option as either an Incentive Option or a Nonstatutory Option.

 

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6.   ELIGIBILITY; TERMS ; TERMINATION OF EMPLOYMENT; TRANSFERABILITY

     6.1. Eligibility. Pursuant and subject to the terms of this Plan, the
Compensation Committee may grant such Awards as the Compensation Committee shall
in its discretion determine to any non-employee member of the Board or of any
board of directors (or similar governing authority) of any Affiliate or any
employee of or officer of one or more of the Company and its Affiliates.
However, only employees of the Company and of the parent or subsidiary
corporations of the Company, as defined in Sections 424(e) and (f),
respectively, of the Code, shall be eligible for the grant of Incentive Options.
In no event shall the number of shares of Class A Common Stock covered by Awards
granted to any one person in any one calendar year exceed 25,000 shares.
     6.2. Terms. Each grant of an Award shall be subject to all applicable terms
and conditions of the Plan, and such other terms and conditions, not
inconsistent with the terms of the Plan, as the Compensation Committee may
prescribe. No prospective Participant shall have any rights with respect to an
Award unless and until the Participant has executed an agreement evidencing the
Award, delivered a fully executed copy thereof to the Company, and otherwise
complied with the applicable terms and conditions of the Award.
     6.3. Termination of Employment or Association. Unless the Compensation
Committee shall provide otherwise with respect to any Award, if the
Participant’s employment or other association with the Company and its
Affiliates ends for any reason, including because of the Participant’s employer
ceasing to be an Affiliate, (a) any outstanding Option or Stock Appreciation
Right of the Participant shall cease to be exercisable in any respect not later
than three months following that event and, for the period it remains
exercisable following that event, shall be exercisable only to the extent
exercisable at the date of that event, and (b) any other outstanding Award of
the Participant shall immediately be forfeited or otherwise be subject to return
to or repurchase by the Company on the terms specified in the applicable Award
Agreement. Military or sick leave or other bona fide leave shall not be deemed a
termination of employment or other association, provided that it does not exceed
the longer of three months or the period during which the absent Participant’s
reemployment rights, if any, are guaranteed by statute or by contract.
     6.4. Limited Transferability of Awards. Except as otherwise provided in
this Section 6.4, Awards shall not be transferable, and no Award or interest
therein may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution. All
of a Participant’s rights in any Award may be exercised during the life of the
Participant only by the Participant or the Participant’s legal representative.
However, the Compensation Committee may, at or after the grant of an Award of a
Nonstatutory Option or shares of Restricted Stock, provide that such Award may
be transferred by the recipient to a family member; provided, however, that any
such transfer is without payment of any consideration whatever and that no
transfer shall be valid unless first approved by the Compensation Committee,
acting in its sole discretion. For this purpose, “family member” means any
child, stepchild, grandchild, parent, stepparent, spouse, former spouse,
sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, including adoptive
relationships, any person sharing the employee’s household (other than a tenant
or employee), a trust in which the foregoing persons have more than fifty
percent of the beneficial interests, a foundation in which the foregoing persons
(or the Participant) control the management of assets, and any other entity in
which these persons (or the Participant) own more than fifty percent of the
voting interests.

 

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7.   SPECIFIC TERMS OF OPTIONS

     7.1. Date of Grant. The granting of an Option shall take place at the time
specified in the Award Agreement.
     7.2. Exercise Price. The price at which shares may be acquired under each
Incentive Option and each Nonstatutory Option shall be not less than 100% of the
Market Value of Class A Common Stock on the Grant Date, and the price under each
Incentive Option granted to a Ten Percent Owner shall be not less than 110% of
the Market Value of Class A Common Stock on the Grant Date.
     7.3. Option Period. No Incentive Option may be exercised on or after the
tenth anniversary of the Grant Date, or on or after the fifth anniversary of the
Grant Date if the Optionee is a Ten Percent Owner. The Option period under each
Nonstatutory Option shall not be so limited solely by reason of this Section.
     7.4. Exercisability. An Option may be immediately exercisable or become
exercisable in such installments, cumulative or non-cumulative, as the
Compensation Committee may determine. In the case of an Option not otherwise
immediately exercisable in full, the Compensation Committee may accelerate the
exercisability of such Option in whole or in part at any time, provided the
acceleration of the exercisability of any Incentive Option would not cause the
Option to fail to comply with the provisions of Section 422 of the Code.
     7.5. Exercise of Option. An Option may be exercised by the Optionee giving
written notice to the Company, specifying the number of shares with respect to
which the Option is then being exercised. The notice shall be accompanied by
payment in the form of cash or certified or bank check payable to the order of
the Company in an amount equal to the exercise price of the shares to be
purchased or, subject to such conditions, if any, as the Compensation Committee
may deem necessary to avoid adverse accounting effects to the Company by
delivery of that number of shares of Class A Common Stock having a Market Value
equal to the exercise price of the shares to be purchased. Receipt by the
Company of such notice and payment shall constitute the exercise of the Option.
Within 30 days thereafter but subject to the remaining provisions of the Plan,
the Company shall deliver or cause to be delivered to the Optionee or his agent
a certificate or certificates for the number of shares then being purchased.
Such shares shall be fully paid and nonassessable. Nothing herein shall be
construed to preclude the Company from participating in a so-called “cashless
exercise”, provided the Optionee or other person exercising the Option and each
other party involved in any such exercise shall comply with such procedures, and
enter into such agreements, of indemnity or otherwise, as the Company shall
specify.
     7.6. Limit on Incentive Option Characterization. An Incentive Option shall
be considered to be an Incentive Option only to the extent that the number of
shares of Class A Common Stock for which the Option first becomes exercisable in
a calendar year do not have an aggregate Market Value (as of the date of the
grant of the Option) in excess of the “current limit”. The current limit for any
Optionee for any calendar year shall be $100,000 minus the aggregate Market
Value at the date of grant of the number of shares of Class A Common Stock
available for purchase for the first time in the same year under each other
Incentive Option previously granted to the Optionee under the Plan and under
each other incentive stock option granted to the Optionee under any other
incentive stock option plan of the Company and its Affiliates. Any shares of
Class A Common Stock which would cause the foregoing limit to be violated shall
be deemed to have been granted under a separate Nonstatutory Option, otherwise
identical in its terms to those of the Incentive Option..
     7.7. Notification of Disposition. Each person exercising any Incentive
Option granted under the Plan shall be deemed to have covenanted with the
Company to report to the Company any disposition of such shares prior to the
expiration of the holding periods specified by Section 422(a)(1) of the Code
and, if and to the extent that the realization of income in such a disposition
imposes upon the Company

 

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federal, state, local or other withholding tax requirements, or any such
withholding is required to secure for the Company an otherwise available tax
deduction, to remit to the Company an amount in cash sufficient to satisfy those
requirements.

8.   STOCK APPRECIATION RIGHTS

     8.1. Tandem or Stand-Alone. Stock Appreciation Rights may be granted in
tandem with an Option (at or, in the case of a Nonstatutory Option, after the
award of the Option) or alone and unrelated to an Option. Stock Appreciation
Rights in tandem with an Option shall terminate to the extent that the related
Option is exercised, and the related Option shall terminate to the extent that
the tandem Stock Appreciation Rights are exercised.
     8.2. Exercise Price. Stock Appreciation Rights shall have an exercise price
of not less than the Market Value of the Stock on the date of award, or in the
case of Stock Appreciation Rights in tandem with Options, the exercise price of
the related Option.

9.   RESTRICTED STOCK.

     9.1. Purchase Price. Shares of Restricted Stock shall be issued under the
Plan for such consideration, if any, in cash, property or services (or any
combination thereof) as determined by the Compensation Committee.
     9.2. Issuance of Certificates. Each Participant receiving a Restricted
Stock Award, subject to Section 9.3, shall be issued a stock certificate in
respect of such shares of Restricted Stock. The certificate shall be registered
in the name of the Participant and, if applicable, shall bear an appropriate
legend referring to the terms, conditions, and restrictions applicable to such
Award.
     9.3. Escrow of Shares. The Compensation Committee may require that the
stock certificates evidencing shares of Restricted Stock be held in custody by a
designated escrow agent (which may but need not be the Company) until the
restrictions thereon shall have lapsed, and that the Participant deliver a stock
power, endorsed in blank, relating to the Stock covered by the Award.
     9.4. Restrictions and Restriction Period. During the Restriction Period
applicable to shares of Restricted Stock, such shares shall be subject to
limitations on transferability and a Risk of Forfeiture arising on the basis of
such conditions related to the performance of services, Company or Affiliate
performance or otherwise as the Compensation Committee may determine and provide
for in the applicable Award Agreement. Any such Risk of Forfeiture may be waived
or terminated, or the Restriction Period shortened, at any time by the
Compensation Committee on such basis as it deems appropriate.
     9.5. Rights Pending Lapse of Risk of Forfeiture or Forfeiture of Award.
Except as otherwise provided in the Plan or the applicable Award Agreement, at
all times prior to lapse of any Risk of Forfeiture applicable to, or forfeiture
of, an Award of Restricted Stock, the Participant shall have all of the rights
of a stockholder of the Company, including the right to vote, and the right to
receive any dividends with respect to, the shares of Restricted Stock. The
Compensation Committee, as determined at the time of Award, may permit or
require the payment of cash dividends to be deferred and, if the Compensation
Committee so determines, reinvested in additional Restricted Stock to the extent
shares are available under Section 4.

 

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     9.6. Lapse of Restrictions. If and when the Restriction Period expires
without a prior forfeiture of the Restricted Stock, the certificates for such
shares shall be delivered to the Participant promptly if not theretofore so
delivered.
10. ADJUSTMENTS FOR CORPORATE TRANSACTIONS
     10.1. Stock Dividend, Etc. In the event of any dividend on Class A Common
Stock payable in Class A Common Stock or any split-up or contraction in the
number of shares of Class A Common Stock after the date of an Award Agreement,
the remaining number of shares of Class A Common Stock subject to that Award and
the price to be paid for each share subject to the Award shall be
proportionately adjusted.
     10.2. Stock Reclassification. In the event of any reclassification or
change of outstanding shares of Class A Common Stock, immediately thereafter
(and subject to further adjustment for subsequent events) any outstanding Award
shall thereafter relate to shares of stock or other securities equivalent in
kind and value to those shares which the Participant would have received if he
or she had held of record the full remaining number of shares of Class A Common
Stock subject to the Award immediately prior to such reclassification or change.
     10.3. Consolidation or Merger. In case of any consolidation or merger of
the Company with or into another company or in case of any sale or conveyance to
another company or entity of the property of the Company as a whole, (a) each
outstanding Option and Stock Appreciation Right shall terminate and, to the
extent that the value of the shares of stock, other securities or cash which a
stockholder is entitled to receive for one share of Class A Common Stock in
connection with such transaction exceeds the exercise price, the Participant
shall be entitled to receive, as determined by the Compensation Committee in its
discretion, either cash or shares of stock, including Class A Common Stock, or
other securities equivalent in value to such excess amount multiplied by the
number of Class A Common Stock shares he or she would have received if he or she
had fully exercised the Option or Stock Appreciation Right and held the number
of shares of the Class A Common Stock issued or otherwise delivered upon such
exercise, immediately prior to such consolidation, merger, sale or conveyance,
and (b) the Risk of Forfeiture on shares of Restricted Stock then subject to
outstanding Awards shall lapse
     10.4. Change in Control. In the event of any Change in Control, each
outstanding Option and Stock Appreciation Right shall become immediately
exercisable and the Risk of Forfeiture on each share of Restricted Stock shall
lapse.
     10.5. Related Matters. Any adjustment required by this Section 10 shall be
determined and made by the Compensation Committee. No fraction of a share shall
be purchasable or deliverable upon exercise, but in the event any adjustment
hereunder of the number of shares covered by an Award shall cause such number to
include a fraction of a share, such number of shares shall be adjusted to the
nearest smaller whole number of shares. In the event of changes in the
outstanding Class A Common Stock by reason of any stock dividend, split-up,
contraction, reclassification, or change of outstanding shares of Class A Common
Stock of the nature contemplated by this Section 10, the number of shares of
Class A Common Stock available for the purposes of the Plan as stated in
Section 4 and the maximum size of Awards for any Participant as stated in
Section 6.1 shall be correspondingly adjusted.
11. SETTLEMENT OF AWARDS
     11.1. Investment Representation. The Company shall be under no obligation
to issue any shares covered by any Award unless the shares to be issued pursuant
to Awards granted under the Plan have been effectively registered under the
Securities Act of 1933, as amended, or the Participant shall

 

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have given a written representation to the Company which is satisfactory in form
and substance to its counsel and upon which the Company may reasonably rely,
that he or she is acquiring the shares for his or her own account for the
purpose of investment and not with a view to, or for sale in connection with,
the distribution of any such shares.
     11.2. Registration. If the Company shall deem it necessary or desirable to
register under the Securities Act of 1933, as amended or other applicable
statutes any shares of Class A Common Stock issued or to be issued pursuant to
Awards granted under the Plan, or to qualify any such shares of Class A Common
Stock for exemption from the Securities Act of 1933, as amended or other
applicable statutes, then the Company shall take such action at its own expense.
     11.3. Certificate Legend. Each certificate for a share of Class A Common
Stock to be issued pursuant to Awards granted under the Plan may, in addition to
any other applicable restriction, bear a legend referring to the investment
representation made in accordance with Section 11.1 and to the fact that no
registration statement has been filed with the Securities and Exchange
Commission with respect to the shares of Class A Common Stock evidenced by the
certificate.
     11.4. Tax Withholding. Whenever shares of Class A Common Stock are issued
or to be issued pursuant to Awards granted under the Plan, the Company shall
have the right to require the recipient to remit to the Company an amount
sufficient to satisfy federal, state, local or other withholding tax
requirements if, when, and to the extent required by law (whether so required to
secure for the Company an otherwise available tax deduction or otherwise) prior
to the delivery of any certificate or certificates for such shares. However, in
such cases, Participants may elect, subject to the approval of the Compensation
Committee, to satisfy the withholding requirement, in whole or in part, by
having the Company withhold shares to satisfy their tax obligations.
Participants may only elect to have Shares withheld having a Market Value on the
date the tax is to be determined equal to the minimum statutory total tax which
could be imposed on the transaction. All elections shall be irrevocable, made in
writing, signed by the Participant, and shall be subject to any restrictions or
limitations that the Compensation Committee, deems appropriate. The obligations
of the Company under the Plan shall be conditional on satisfaction of all such
withholding obligations and the Company shall, to the extent permitted by law,
have the right to deduct any such taxes from any payment of any kind otherwise
due to the recipient of an Award.
12. LIMITATION OF RIGHTS IN STOCK; NO SPECIAL SERVICE RIGHTS
     A Participant shall not be deemed for any purpose to be a stockholder of
the Company with respect to any of the shares of Class A Common Stock issuable
pursuant to an Award, except to the extent that the Award shall have been
exercised with respect thereto and, in addition, a certificate shall have been
issued therefor and delivered to the Participant or his agent. Nothing contained
in the Plan or in any Award Agreement shall confer upon any recipient of an
Award any right with respect to the continuation of his or her employment or
other association with the Company (or any Affiliate), or interfere in any way
with the right of the Company (or any Affiliate), at any time to terminate such
employment agreement or to increase or decrease, or otherwise adjust, the other
terms and conditions of the recipient’s employment or other association with the
Company and its Affiliates.
13. TERMINATION AND AMENDMENT OF THE PLAN
     The Board may at any time terminate the Plan or make such modifications of
the Plan as it shall deem advisable. No termination or amendment of the Plan
may, without the consent of any recipient of an Award granted hereunder,
adversely affect the rights of such recipient under that Award. The Compensation
Committee may amend the terms of any Award theretofore granted, prospectively or

 

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retroactively, provided as amended the Award is consistent with the terms of the
Plan, but no such amendment shall impair the rights of the recipient of the
Award without his or her consent.
14. GOVERNING LAW
     The Plan and all Award Agreements and actions taken thereunder shall be
governed, interpreted and enforced in accordance with the laws of the
Commonwealth of Massachusetts, without regard to the conflict of laws principles
thereof.