Exhibit 10(b)-17

 

TCF FINANCIAL INCENTIVE STOCK PROGRAM

 

NONQUALIFIED STOCK OPTION AGREEMENT

 

NQO NO. 32

 

This option is granted on July 31, 2008 by TCF Financial Corporation (“TCF
Financial”) to Barry N. Winslow (the “Optionee”) in accordance with the
following terms and conditions:

 

1.                                       Option Grant, Vesting and Exercise
Period.

 

a.                                       TCF Financial hereby grants to the
Optionee an Option (the “Option”) to purchase, pursuant to the TCF Financial
Stock Incentive Program (the “Plan”), and upon the terms and conditions therein
and hereinafter set forth, up to but not exceeding in the aggregate 200,000
shares (the “Option Shares”) of common stock of TCF Financial at an exercise
price of $12.85 per share.  A copy of the Plan, as currently in effect, is
incorporated herein by reference and is attached hereto.

 

b.                                      This Option shall be exercisable only
during the period (“Exercise Period”) commencing on the date of grant of this
Option and ending at 5:00 p.m., Minneapolis, Minnesota time, on the date ten
years and one day after the date of grant of this Option, such time and date
being hereinafter referred to as the “Expiration Date.”  This Option shall
become exercisable (“vest”) with respect to fifty percent (50%) of the Option
Shares on January 1, 2011 and with respect to the remaining fifty percent (50%)
of the Option Shares on January 1, 2012, except as may be otherwise provided
under paragraphs 5 and 9 of this Agreement.  Once the Option has vested, it may
be exercised, in whole or in part, at any time and from time to time during the
remainder of the Exercise Period, provided that the total percentage vesting
under this Agreement shall never in any event exceed 100% of the Option Shares.

 

2.                                       Method of Exercise of this Option.  To
the extent it is exercisable under subparagraph 1.b of this Agreement, this
Option may be exercised during the Exercise Period by giving written notice to
TCF Financial specifying the number of Option Shares to be purchased.  The
notice must be in the form prescribed by the committee referred to in section 2
of the Plan or its successor (the “Committee”) and directed to the address set
forth in paragraph 12 below.  The date of exercise is the date on which such
notice is received by TCF Financial.  Such notice must be accompanied by payment
in full for the Option Shares to be purchased upon such exercise.  Payment shall
be made either (i) in cash, which may be in the form of a check, bank draft, or
money order payable to TCF Financial, or (ii) if the Committee shall have
previously approved such form of payment, by delivering shares of Common Stock
already owned by the Optionee having a “Fair Market Value” (as defined in the
Plan as in effect on the date of the grant of this Option) on the date of
exercise equal to the applicable exercise price, or (iii) if the Committee shall
have previously approved such form of payment, a combination of cash and such
already-owned shares or (iv) if the Committee shall have previously approved a
cashless exercise program, the Optionee may also exercise the Option in
accordance with a cashless exercise program by electing to have withheld from
shares of Common Stock otherwise issuable to Optionee upon exercise of the
Option a number

 

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of shares of Common Stock whose “Fair Market Value” (as defined in the Plan) on
the date of exercise is equal to the applicable exercise price.  Promptly after
such payment, subject to paragraph 3 below, TCF Financial shall issue and
deliver to the Optionee or other person exercising this Option a certificate or
certificates representing the shares of Common Stock so purchased, registered in
the name of the Optionee (or such other person), or, upon request, in the name
of the Optionee (or other person) and in the name of another jointly with right
of survivorship.

 

3.                                       Delivery and Registration of Shares of
Common Stock.  TCF Financial’s obligation to deliver shares of Common Stock
hereunder shall, if the Committee so requests, be conditioned upon the receipt
of a representation as to the investment intention of the Optionee or any other
person to whom such shares are to be delivered, in such form as the Committee
shall determine to be necessary or advisable to comply with the provisions of
the Securities Act of 1933, as amended, or any other Federal, state, or local
securities law or regulation.  In requesting any such representation, it may be
provided that such representation requirement shall become inoperative upon a
registration of such shares or other action eliminating the necessity of such
representation under such Securities Act or other securities law or regulation. 
TCF Financial shall not be required to deliver any shares upon exercise of the
Option prior to (i) the admission of such shares to listing on any stock
exchange or system on which the shares of Common Stock may then be listed, and
(ii) the completion of such registration or other qualification of such shares
under any state or Federal law, rule, or regulation, as the Committee shall
determine to be necessary or advisable.

 

4.                                       Non-transferability of this Option. 
This Option may not be assigned, encumbered, or transferred except, in the event
of the death of the Optionee, by will or the laws of descent and distribution to
the extent provided in paragraph 5 below.  This Option is exercisable during the
Optionee’s lifetime only by the Optionee.  The provisions of the Option shall be
binding upon, inure to the benefit of, and be enforceable by the parties hereto,
the successors and assigns of TCF Financial, and any person to whom this Option
is transferred by will or by the laws of descent and distribution.

 

5.                                       Termination of Service or Death of the
Optionee.

 

a.                                       Except as provided in subparagraphs b.,
c., or d. of this paragraph 5 and notwithstanding any other provision of this
Option to the contrary, this Option shall not be exercisable unless the
Optionee, at the time the Optionee exercises this Option, has maintained
“Continuous Service” (as defined herein) since the date of the grant of this
Option.  “Continuous Service” shall mean that the Optionee is an employee of TCF
Financial or a subsidiary of TCF Financial at all times during the period
beginning on the date of the granting of this Option and ending on a date no
earlier than three months before the date of exercise of this Option, provided
that such employment status is determined consistently with the requirements
that would apply if this Option were an incentive stock option.

 

b.                                      If the Optionee shall cease to maintain
Continuous Service for any reason (excluding disability, retirement or death),
the Optionee may, but only within the period of three months immediately
following such cessation of Continuous Service and in no event after the
Expiration Date, exercise this Option to the extent the Optionee was entitled to
exercise this Option at the date of cessation.  If the Optionee is terminated
for cause, however, all rights under this Option shall expire immediately upon
the giving to the Optionee of notice of such termination.

 

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c.                                       In the event of termination of
employment due to retirement (as determined in the discretion of the Committee),
disability or death after the date of grant but prior to one or both of the
vesting dates set forth in subparagraph 1.b above, the Optionee may, but only
within the period of twelve months immediately following the applicable vesting
date exercise a prorated portion of this Option, which prorated portion shall be
equal to the sum of:

 

(1)                                  the number of Option Shares (rounding up to
the next highest whole share but not to exceed 50% of the Option Shares)
obtained by multiplying (a) the number of Option Shares subject to this Option
that would have vested on January 1, 2011 had such termination of employment not
occurred by (b) a fraction, the numerator of which is the number of Optionee’s
full calendar months of Continuous Service from August 1, 2008 through the date
of such termination; and the denominator of which is 29, provided, however, this
clause (1) shall apply only if the event of termination occurs on a date prior
to January 1, 2011; and

 

(2)                                  the number of Option Shares (rounding up to
the next highest whole share but not to exceed 50% of the aggregate Option
Shares) obtained by multiplying (a) the number of Option Shares subject to this
Option that would have vested on January 1, 2012 had such termination of
employment not occurred by (b) a fraction, the numerator of which is the number
of Optionee’s full calendar months of Continuous Service from August 1, 2008
through the date of such termination; and the denominator of which is 41.

 

As to the remaining Option Shares that do not become exercisable based on the
calculations in clauses (1) and (2) above, all rights under this Option shall
expire immediately.

 

d.                                      In the event of termination of
employment during the Exercise Period due to retirement (as determined in the
discretion of the Committee), disability or  death of the Optionee while in
Continuous Service of TCF Financial, the Optionee (or in the case of death, the
person to whom the Option has been transferred by will or by the laws of descent
and distribution, to the extent the Optionee was entitled to exercise this
Option immediately prior to such death) may exercise this Option at any time
within one year following such retirement, disability or death, but in no event
later than the Expiration Date.  If the Optionee should die within three months
after termination of employment for any reason other than retirement or
disability, the right of the Optionee’s successor-in-interest to exercise this
Option shall terminate upon the earlier of the Expiration Date or the date three
months after the Optionee’s death.   If the Optionee should die within twelve
months after termination of employment due to retirement or disability, the
right of the Optionee’s successor-in-interest to exercise this Option shall
terminate upon the later of twelve months after the date of employment
termination or three months after the Optionee’s death, but not later than the
Expiration Date. Following the death of the Optionee, the Committee may, as an
alternative means of settlement of this Option, elect to pay to the person to
whom this Option is transferred by will or by the laws of descent and
distribution the amount by which the Fair Market Value (as defined in the Plan)
of a share of Common Stock on the date of exercise of this Option shall exceed
the Exercise Price per Option Share, multiplied by the number of Option Shares
with respect to which this Option is properly exercised.  Any such settlement of
this Option shall be considered an exercise of this Option for all purposes of
this Option and of the Plan.

 

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6.                                       No Notice of Sale.  The Optionee or any
person to whom the Option or the Option Shares shall have been transferred by
will or by the laws of descent and distribution shall not be required to give
notice to TCF Financial in the event of the sale or other disposition of Option
Shares subsequent to exercise of the Option, except to the extent the Optionee
is required to report transactions in TCF Financial common stock in general.

 

7.                                       Adjustments for Changes in
Capitalization of TCF Financial.  In the event of any change in the outstanding
shares of Common Stock by reason of any reorganization, recapitalization, stock
split, stock dividend, combination or exchange of shares, merger, consolidation,
or any change in the corporate structure of TCF Financial or in the shares of
Common Stock, the number and class of shares covered by this Option and the
Exercise Price shall be appropriately adjusted by the Committee, whose
determination shall be conclusive.  Notwithstanding the foregoing, the Committee
shall not make any modifications that would cause the Option to become subject
to 409A of the Internal Revenue Code.

 

8.                                       Effect of Merger.  In the case of any
merger, consolidation, or combination of TCF Financial with or into another
corporation or other business organization (other than a merger, consolidation,
or combination in which TCF Financial is the continuing entity and which does
not result in the outstanding shares of Common Stock being converted into or
exchanged for different securities, cash or other property, or any combination
thereof), the Committee may authorize the issuance or assumption of Benefits (as
defined in the Plan) as it may deem appropriate.  Notwithstanding the foregoing,
the Committee shall not make any modifications that would cause the Option to
become subject to 409A of the Internal Revenue Code.

 

9.                                       Effect of Change in Control.  Each of
the events specified in the following clauses (a) through (c) of this paragraph
9 shall be deemed a “change in control” of TCF Financial (herein referred to as
the “Company”):

 

(a)                                  any “person” as defined in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) is
or becomes the “beneficial owner” as defined in Rule 13d-3 under the Exchange
Act, directly or indirectly, of securities of the Company representing thirty
percent (30%) or more of the combined voting power of the Company’s then
outstanding securities.  For purposes of this clause (a), the term “beneficial
owner” does not include any employee benefit plan maintained by the Company that
invests in the Company’s voting securities; or

 

(b)                                 during any period of two (2) consecutive
years (not including any period prior to the date on which the Plan was approved
by the Company’s Board of Directors) there shall cease to be a majority of the
Company’s Board of Directors (“Board”) comprised as follows:  individuals who at
the beginning of such period constitute the Board or new directors whose
nomination for election by the Company’s stockholders was approved by a vote of
at least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved; or

 

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(c)                                  the stockholders of the Company approve a
merger or consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 70% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of the Company approve a plan
of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company’s assets;
provided, however, that no change in control will be deemed to have occurred if
such merger, consolidation, sale or disposition of assets, or liquidation is not
subsequently consummated.

 

This Option shall (to the extent it is not then exercisable) become exercisable
in full upon the happening of such event and shall remain so exercisable until
the Expiration Date, provided that (a) the provisions of this paragraph 9 shall
not be deemed to cause this Option to be exercisable to the extent it has
previously been exercised or otherwise terminated; and (b) the provisions of
this paragraph 9 shall not cause this Option to become exercisable within six
months after the date of grant if the Optionee is then subject to the
restrictions of Section 16(b) of the Securities Exchange Act of 1934.

 

10.                                 Stockholder Rights not Granted by this
Option.  The Optionee is not entitled by virtue hereof to any rights of a
stockholder of TCF Financial or to notice of meetings of stockholders or to
notice of any other proceedings of TCF Financial.

 

11.                                 Withholding Tax.  Where the Optionee or
another person is entitled to receive Option Shares pursuant to the exercise of
this Option, TCF Financial shall have the right to require the Optionee or such
other person to pay to TCF Financial the amount of any taxes which TCF Financial
or any of it affiliates is required to withhold with respect to such Option
Shares, or, in lieu thereof, to retain, or sell without notice, a sufficient
number of such shares to cover the amount required to be withheld or in lieu of
any of the foregoing, to withhold or direct the withholding of a sufficient sum
from the Optionee’s compensation to satisfy such tax withholding requirements. 
TCF Financial’s method of satisfying its withholding obligations shall be solely
in the discretion of TCF Financial, subject to applicable federal, state, and
local law.

 

12.                                 Notices.  All notices hereunder to TCF
Financial shall be delivered or mailed to it addressed to TCF Financial
Corporation, 200 East Lake Street, Wayzata, Minnesota 55391.  Any notices
hereunder to the Optionee shall be delivered personally or mailed to the
Optionee’s address noted below.  Such addresses for the service of notices may
be changed at any time provided written notice of the change is furnished in
advance to TCF Financial or to the Optionee, as the case may be.

 

13.                                 Plan and Plan Interpretations as
Controlling.  This Option and the terms and conditions herein set forth are
subject in all respects to the terms and conditions of the Plan, which are
controlling.  All determinations and interpretations of the Committee shall be
binding and

 

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conclusive upon the Optionee or his legal representatives with regard to any
question arising hereunder or under the Plan.

 

14.                                 Optionee Service.  Nothing in this Option
shall limit the right of TCF Financial or any of its affiliates to terminate the
Optionee’s service as a director, officer, or employee, or otherwise impose upon
TCF Financial or any of its affiliates any obligation to employ or accept the
services of the Optionee.

 

15.                                 Optionee Acceptance.  The Optionee shall
signify his or her acceptance of the terms and conditions of this Option by
signing in the space provided below and returning a signed copy hereof to TCF
Financial at the address set forth in paragraph 12 above.

 

16.                                 Non-Competition and Non-Solicitation
Obligations.  The Optionee acknowledges that Optionee is subject to certain
non-competition, non-solicitation and other obligations (the “Obligations”)
under separate contractual agreement(s) with TCF Financial or TCF National
Bank.  Optionee affirms that this Agreement and the Shares awarded hereunder
constitute additional consideration for the Obligations, which Optionee hereby
re-affirms as binding and enforceable obligations of the Optionee, and that the
Options and other consideration awarded hereunder may be cancelled or forfeited
in the event Optionee breaches the Obligations.

 

IN WITNESS WHEREOF, the parties hereto have caused this Option to be executed as
of the date first above written.

 

 

 

TCF FINANCIAL CORPORATION

 

 

 

 

 

 

 

 

By /s/ Gregory J. Pulles

 

 

Secretary

 

 

 

 

 

 

 

 

ACCEPTED

 

 

 

 

 

/s/ Barry N. Winslow

 

 

Barry N. Winslow

 

 

 

 

 

 

 

 

(Street address)

 

 

 

 

 

 

 

 

(City, State and Zip Code)

 

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