Exhibit 10.1
 
MEDALLION FINANCIAL CORP.
Amended and Restated 1996 Stock Option Plan
(amended and restated as of April 25, 2002)
(approved by the stockholders on June 11, 2002)
 
Amended and Restated 1996 Stock Option Plan, amended and restated as of April
25, 2002 (the “Plan”), is intended to encourage ownership of Common Stock, $0.01
par value (the “Stock”) of Medallion Financial Corp. (the “Company”) by officers
and employees of the Company and its affiliates so as to provide additional
incentives to promote the success of the Company and its affiliates through the
grant of Incentive Stock Options and Nonstatutory Stock Options (collectively,
as defined below, “Options”).
 
1.    Administration of the Plan.
 
The Plan shall be administered by the Board of Directors of the Company (the
“Board”) or a committee of the Board (the entity administering the Plan
hereafter referred to as “Committee”). Within the limits of the Plan, the
Committee shall determine the individuals to whom, and the times at which,
Options shall be granted, the type of Option to be granted, the duration of each
Option, the price and method of payment for each Option, and the time or times
within which (during its term) all or portions of each Option may be exercised.
The Committee may establish such rules as it deems necessary for the proper
administration of the Plan, make such determinations and interpretations with
respect to the Plan and Options granted under it as may be necessary or
desirable and include such further provisions or conditions in Options granted
under the Plan as it deems advisable. To the extent permitted by law, the
Committee may delegate its authority under the Plan to other individuals;
provided, however, that Options granted to any person subject to Section 16 of
the Securities Exchange Act of 1934 (the “Exchange Act”) shall be granted by the
Board or a committee of at least two members thereof, each of whom shall be a
“non-employee director” within the meaning of Rule 16b-3 of the Exchange Act. In
addition, to the degree that Options granted to any person are intended to
qualify as performance-based compensation within the meaning of Section 162(m)
of the Internal Revenue Code of 1986, as amended (the “Code”), such Options
shall be granted by at least two members of the Board who are “outside
directors” within the meaning of Section 162(m) of the Code.
 
2.    Shares Subject to the Plan.
 
(a)  Number and Type of Shares. The aggregate number of shares of Stock of the
Company which may be optioned under the Plan is 2,250,000 shares. In the event
that the Committee in its discretion determines that any stock dividend,
split-up, combination or reclassification of shares, recapitalization or other
similar capital change affects the Stock such that adjustment is required in
order to preserve the benefits or potential benefits of the Plan or any Option
granted under the Plan, the maximum aggregate number and kind of shares or
securities of the Company as to which Options may be granted under the Plan and
as to which Options then outstanding shall be exercisable, and the option price
of such Options, shall be

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appropriately adjusted by the Committee (whose determination shall be
conclusive) so that the proportionate number of shares or other securities as to
which Options may be granted and the proportionate interest of holders of
outstanding Options shall be maintained as before the occurrence of such event.
 
(b)  Effect of Certain Transactions. In the event of a consolidation or merger
of the Company with another corporation, or the sale or exchange of all or
substantially all of the assets of the Company, or a reorganization or
liquidation of the Company, each holder of an outstanding Option shall be
entitled to receive upon exercise and payment in accordance with the terms of
the Option the same shares, securities or property as he would have been
entitled to receive upon the occurrence of such event if he had been,
immediately prior to such event, the holder of the number of shares of Stock
purchasable under his Option; provided, however, that in lieu of the foregoing
the Board of Directors of the Company (the “Board”) may upon written notice to
each holder of an outstanding Option provide that such Option shall terminate on
a date not less than 20 days after the date of such notice unless theretofore
exercised. In connection with such notice, the Board may in its discretion
accelerate or waive any deferred exercise period. Options granted under this
Plan may contain such provisions as the Committee shall approve permitting part
or all of such options to become exercisable without regard to any deferred
exercise period in the event of a change of control of the Company, as defined
by the Committee.
 
(c)  Restoration of Shares. If any Option expires or is terminated unexercised
or is forfeited for any reason, the shares subject to such Option, to the extent
of such expiration, termination or forfeiture, shall again be available for
granting Options under the Plan, subject, however, in the case of Incentive
Stock Options, to any requirements under the Code.
 
(d)  Reservation of Shares. The Company shall at all times while the Plan is in
force reserve such number of shares of Stock as will be sufficient to satisfy
the requirements of the Plan. Shares issued under the Plan may consist in whole
or in part of authorized but unissued shares or treasury shares.
 
3.    Grant of Options; Eligible Persons.
 
(a)  Types of Options. Options may be granted under the Plan either as incentive
stock options (“Incentive Stock Options”), as defined in Section 422 of the Code
or as Options which do not meet the requirements of Section 422 (“Nonstatutory
Stock Options”). Options may be granted from time to time by the Committee,
within the limits set forth in Sections 1 and 2 of the Plan, to all employees of
the Company or of any parent corporation or subsidiary corporation of the
Company (as defined in Sections 424(e) and (f), respectively, of the Code);
provided, however, that Options with respect to no more than 500,000 shares of
Stock may be granted to any individual in any single calendar year.
 
(b)  Date of Grant. The date of grant for each Option shall be the date on which
it is approved by the Committee, or such later date as the Committee may
specify. No Incentive Stock Options shall be granted hereunder after ten years
from the date on which the Plan was approved by the Board.

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(c)  Automatic Awards. The Committee may provide for the automatic award of an
Option upon the delivery of shares to the Company in payment of an Option for up
to the number of shares so delivered.
 
4.    Form of Options.
 
Options granted hereunder shall be evidenced by a writing delivered to the
optionee specifying the terms and conditions thereof and containing such other
terms and conditions not inconsistent with the provisions of the Plan as the
Committee considers necessary or advisable to achieve the purposes of the Plan
or comply with applicable tax and regulatory laws and accounting principles. The
form of such Options may vary among optionees.
 
5.    Option Price.
 
The price at which shares may from time to time be optioned shall be determined
by the Committee, provided that such price shall not be less than the fair
market value of the Stock on the date of granting as determined in good faith by
the Committee; and provided further that no Incentive Stock Option shall be
granted to any individual who is ineligible to be granted an Incentive Stock
Option because his ownership of stock of the Company or its parent or subsidiary
corporations exceeds the limitations set forth in Section 422(b)(6) of the Code
unless such option price is at least 110% of the fair market value of the Stock
on the date of grant.
 
To the extent permitted by law, the Committee may in its discretion permit the
option price to be paid in whole or in part by a note or in installments or with
shares of Stock of the Company or such other lawful consideration as the
Committee may determine; provided, however, that to the degree the option price
is paid through the delivery of Stock such Stock must be “mature” for purposes
of generally accepted accounting principles, i.e., (i) held by the optionee free
and clear for at least six months prior to the use thereof to pay part of an
option price, (ii) purchased by the optionee on the open market, or (iii)
meeting any other requirements for “mature” shares as may exist on the date of
the use thereof to pay part of an option price.
 
6.    Term of Option and Dates of Exercise.
 
(a)  Exercisability. The Committee shall determine the term of all Options, the
time or times that Options are exercisable and whether they are exercisable in
installments, provided that the term of each Incentive Stock Option granted
under the Plan shall not exceed a period of ten years from the date of its
grant, and provided further that no Incentive Stock Option shall be granted to
any individual who is ineligible to be granted such Option because his ownership
of stock of the Company or its parent or subsidiary corporations exceeds the
limitations set forth in Section 422(b)(6) of the Code unless the term of his
Incentive Stock Option does not exceed a period of five years from the date of
its grant. In the absence of such determination, the Option shall be exercisable
at any time or from time to time, in whole or in part, during a period of ten
years from the date of its grant or, in the case of an Incentive Stock Option,
the maximum term of such Option.
 
(b)  Effect of Disability, Death or Termination of Employment. The Committee
shall determine the effect on an Option of the disability, death, retirement or
other termination of employment of an optionee and the extent to which, and the
period during which,

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the optionee, the optionee’s estate, legal representative, guardian, or
beneficiary on death may exercise rights thereunder. Any beneficiary on death
shall be designated by the optionee, in the manner determined by the Committee,
to exercise rights of the optionee in the case of the optionee’s death. In the
event no beneficiary is designated or survives the optionee, the optionee’s
rights shall pass to the optionee’s estate, to the degree so allowed by the
Committee.
 
(c)  Other Conditions. The Committee may impose such conditions with respect to
the exercise of Options, including conditions relating to applicable federal or
state securities laws, as it considers necessary or advisable.
 
(d)  Withholding. The optionee shall pay to the Company, or make provision
satisfactory to the Committee for payment of, any taxes required by law to be
withheld in respect of any Options under the Plan no later than the date of the
event creating the tax liability. In the Committee’s discretion, such tax
obligations may be paid in whole or in part in shares of Stock, including shares
retained from the exercise of the Option creating the tax obligation, valued at
the fair market value of the Stock on the date of delivery to the Company as
determined in good faith by the Committee. The Company and any parent
corporation or subsidiary corporation of the Company (as defined in Sections
424(e) and (f), respectively, of the Code) may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind otherwise due to
the optionee.
 
(e)  Amendment of Options. The Committee may amend, modify or terminate any
outstanding Option, including substituting therefor another Option of the same
or different type, changing the date of exercise or realization and converting
an Incentive Stock Option to a Nonstatutory Stock Option, provided that the
optionee’s consent to such action shall be required unless the Committee
determines that the action, taking into account any related action, would not
materially and adversely affect the optionee.
 
7.    Non-transferability.
 
Generally, an Option shall not be transferable, except by will or by the laws of
descent and distribution, or, in the case of Nonstatutory Stock Options, to the
extent consistent with qualifying for the exemption provided by Rule 16B-3 under
the Exchange Act, pursuant to a qualified domestic relations order, and the
Options shall be exercisable, during the holder’s lifetime, only by him or her
or such permitted transferee.
 
8.    No Right to Employment.
 
No persons shall have any claim or right to be granted an Option, and the grant
of an Option shall not be construed as giving an optionee the right to continued
employment. The Company expressly reserves the right at any time to dismiss an
optionee free from any liability or claim under the Plan, except as specifically
provided in the applicable Option.
 
9.    No Rights as a Shareholder.
 
Subject to the provisions of the applicable Option, no optionee or any person
claiming through an optionee shall have any rights as a shareholder with respect
to any shares of Stock to be distributed under the Plan until he or she becomes
the holder thereof.

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10.    Amendment or Termination.
 
The Board may amend or terminate the Plan at any time, provided that no
amendment shall be made without stockholder approval if such approval is
necessary to comply with any applicable tax or regulatory requirement, including
any requirement for exemptive relief under Section 16(b) of the Exchange Act or
Section 162(m) of the Code, if compliance is so intended by the Committee.
 
11.    Stockholder Approval.
 
The Plan is subject to approval by the stockholders of the Company by the
affirmative vote of the holders of a majority of the shares of capital stock of
the Company entitled to vote thereon and present or represented at a meeting
duly held in accordance with the laws of the State of Delaware, or by any other
action that would be given the same effect under the laws of such jurisdiction,
which action in either case shall be taken within twelve (12) months from the
date the Plan was adopted by the Board. In the event such approval is not
obtained, all Options granted under the Plan shall be void and without effect.
 
12.    Governing Law.
 
The provisions of the Plan shall be governed by and interpreted in accordance
with the laws of the State of Delaware, without reference to the provisions of
conflicts of law thereunder.

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