Exhibit 10.3


 


NOTWITHSTANDING
ANY OTHER PROVISION OF THIS AGREEMENT, NO SHARES OF NEVADA SECURITY BANK’S
STOCK SHALL BE ISSUED PURSUANT HERETO UNLESS THE NEVADA SECURITY BANK 2002
STOCK OPTION PLAN SHALL HAVE FIRST BEEN APPROVED BY THE SHAREHOLDERS OF NEVADA
SECURITY BANK.


 


 


NEVADA SECURITY BANK


 


NONQUALIFIED STOCK OPTION AGREEMENT


 


 


This
Nonqualified Stock Option Agreement (the “Agreement”) is made and entered into
as of the 18th day of July, 2002, by and between Nevada Security
Bank, a Nevada corporation (the “Bank”), and Hal
Giomi (“Optionee”);


 


WHEREAS,
pursuant to the Nevada Security Bank 2002 Stock Option Plan (the “Plan”), a
copy of which is attached hereto, the Board of Directors of the Bank has
authorized granting to Optionee, a nonqualified stock option to purchase all or
any part of Twenty-Two Thousand Five Hundred,
(22,500) authorized but unissued
shares of the Bank’s common stock for cash at the price of Ten Dollars and No Cents ($10.00)
per share, such option to be for the term and upon the terms and conditions
hereinafter stated;


 


NOW,
THEREFORE, it is hereby agreed:


 


1.                                      Grant
of Option.  Pursuant to said
action of the Board of Directors and pursuant to authorizations granted by all
appropriate regulatory and governmental agencies, the Bank hereby grants to
Optionee the option to purchase, upon and subject to the terms and conditions
of the Plan, which is incorporated in full herein by this reference, all or any
part of Twenty-Two Thousand Five Hundred,
(22,500) shares of the Bank’s
common stock (hereinafter called “Common Stock”) at the price of Ten Dollars and No Cents ($10.00)
per share, which price is not less than one hundred percent (100%) of the fair
market value of the Common Stock as of the date of action of the Board of
Directors granting this option.


 


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2.                                      Exercisability.  This option shall be exercisable as to:


 




	
  4,500 Shares

  	
   

  	
  Upon Grant, July 18, 2002

  
	
  4,500 Shares

  	
   

  	
  After July 18, 2003

  
	
  4,500 Shares

  	
   

  	
  After July 18, 2004

  
	
  4,500 Shares

  	
   

  	
  After July 18, 2005

  
	
  4,500 Shares

  	
   

  	
  After July 18, 2006

  






 


This option shall remain
exercisable as to all of such shares until July 18,
2012 (but not later than ten (10) years from the date this option is
granted) unless this option has expired or terminated earlier in accordance
with the provisions hereof.  Shares as
to which this option becomes exercisable pursuant to the foregoing provision
may be purchased at any time prior to expiration of this option.


 


3.                                      Exercise
of Option.  This option may be
exercised by written notice delivered to the Bank stating the number of shares
with respect to which this option is being exercised, together with cash or
qualifying shares of the Bank’s stock, as applicable,  in the amount of the purchase price of such shares.  Not less than one (1) share may be purchased
at any one time, and in no event may the option be exercised with respect to
fractional shares. Upon exercise, Optionee shall be responsible for providing
Bank with that information necessary for the payment of any federal and state
taxes then due, as provided in the Plan.  
Notwithstanding the foregoing or anything to the contrary contained
herein or in the Plan, benefits in the form of payment of taxes by the Bank
shall not be payable under this section or under the Plan to the extent
the benefit would be an excess parachute payment under Section 280G of the
Internal Revenue Code of 1986, as amended


 


4.                                      Cessation
of Directorship or Employment. 
Except as provided in Paragraphs 2 and 5 hereof, if Optionee shall cease
to be a director or an employee of the Bank or a subsidiary corporation for any
reason other than Optionee’s death or disability [as defined in
Section 22(e)(3) of the Internal Revenue Code of 1986, as amended from
time to time (the “Code”)], this 


 


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option shall expire three (3)
months thereafter.  During the three (3)
month period this option shall be exercisable only as to those installments, if
any, which had accrued as of the date when the Optionee ceased to be a director
or an employee of the Bank or a subsidiary corporation.


 


5.                                      Termination
of Employment for Cause.  If
Optionee is an employee of the Bank or a subsidiary corporation and Optionee’s
employment with the Bank or a subsidiary corporation is terminated for cause,
this option shall expire immediately, unless reinstated by the Board of
Directors within thirty (30) days of such termination by giving written notice
of such reinstatement to Optionee at his or her last known address.  In the event of such reinstatement, Optionee
may exercise this option only to such extent, for such time, and upon such
terms and conditions as if Optionee had ceased to be an employee of the Bank or
a subsidiary corporation upon the date of such termination for a reason other
than cause, death or disability. 
Termination for cause shall include, but not be limited to, termination
for malfeasance or gross misfeasance in the performance of duties or conviction
of a crime involving moral turpitude, and, in any event, the determination of
the Board of Directors with respect thereto shall be final and conclusive.


 


6.                                      Nontransferability;
Death or Disability of Optionee. 
This option shall not be transferable except by will or by the
applicable laws of descent and distribution and shall be exercisable during
Optionee’s lifetime only by Optionee. 
If Optionee dies while serving as a director or an employee of the Bank
or a subsidiary corporation, or during the three (3) month period referred to
in Paragraph 4 hereof, this option shall expire one (1) year after the date of
Optionee’s death or on the day specified in Paragraph 2 hereof, whichever is
earlier.  After Optionee’s death but
before such expiration, the persons to whom Optionee’s rights under this option
shall have passed by will or by the applicable laws of descent and distribution
or the executor or administrator of Optionee’s estate shall have the right to
exercise this option as to those shares for which installments had accrued
under Paragraph 2 hereof as of the date on which Optionee ceased to be a
director or an employee of the Bank or a subsidiary corporation.


 


If Optionee
terminates his or her directorship or employment because of disability,
Optionee may exercise this option to the extent he or she is entitled to do so
at the date of 


 


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termination, at any time within
one (1) year of the date of termination, or before the expiration date
specified in Paragraph 2 hereof, whichever is earlier.


 


7.                                      Employment.  This Agreement shall not obligate the Bank
or a subsidiary corporation to employ Optionee for any period, nor shall it
interfere in any way with the right of the Bank or a subsidiary corporation to
reduce Optionee’s compensation.


 


8.                                      Privileges
of Stock Ownership.  Optionee
shall have no rights as a shareholder with respect to the Common Stock subject
to this option until the date of issuance of stock certificates to
Optionee.  Except as provided in the
Plan, no adjustment will be made for dividends or other rights for which the
record date is prior to the date such stock certificates are issued.


 


9.                                      Modification
and Termination.  The rights of
Optionee are subject to modification and termination upon the occurrence of
certain events as provided in Sections 13 and 14 of the Plan.


 


10.                               Notification
of Sale.  Optionee agrees that
Optionee, or any person acquiring shares upon exercise of this option, will
notify the Bank not more than five (5) days after any sale or other disposition
of such shares.  No shares issuable upon
the exercise of this option shall be issued and delivered unless and until the
Bank has fully complied with all applicable requirements of any regulatory
agency having jurisdiction over the Bank, and all applicable requirements of
any exchange upon which the Common Stock of the Bank may be listed.


 


11.                               Notices.  Any notice to the Bank provided for in this
Agreement shall be addressed to it in care of its President at its main office
and any notice to Optionee shall be addressed to Optionee’s address on file
with the Bank or a subsidiary corporation, or to such other address as either
may designate to the other in writing. 
Any notice shall be deemed to be duly given if and when enclosed in a
properly sealed envelope and addressed as stated above and deposited, postage
prepaid, with the United States Postal Service.  In lieu of giving notice by mail as aforesaid, any written notice
under this Agreement may be given to Optionee in person, and to the Bank by
personal delivery to its President.


 


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IN WITNESS
WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.


 


 


	
  OPTIONEE

  	
   

  	
   

  	
  NEVADA SECURITY BANK

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
   /s/Hal Giomi

  	
   

  	
  By 

  	
  /s/Ed Allison

  	
   

  
	
   

  	
  Hal Giomi

  	
   

  	
   

  	
  Ed Allison, Chairman of the Board

  



 


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