<PAGE>

                                                                     Exhibit 4.1

                           PACIFIC MERCANTILE BANCORP
                   AMENDED AND RESTATED 1999 STOCK OPTION PLAN

     This AMENDED AND RESTATED 1999 STOCK OPTION PLAN of Pacific Mercantile
Bancorp, a California corporation (the "Company"), and integrates into a single
instrument, the 1999 Stock Option Plan of Pacific Mercantile Bank (the "Bank"),
the predecessor and the wholly-owned subsidiary of the Company, and all
amendments made to that Plan, with reference to the following:

     A.   On March 2, 1999, the Bank's Board of Directors adopted, and on
January 11, 2000 the Bank's shareholders approved, the Bank's 1999 Stock Option
Plan (the "Bank Plan"), which provided for the grant of options to purchase
shares of the Bank's Common Stock to directors, officers and employees of the
Bank.

     B.   Effective as of June 12, 2000, the Bank became a wholly-owned
subsidiary of the Company pursuant to a Plan of Reorganization and Merger
Agreement dated as of February 29, 2000 (the "Merger Agreement").  Pursuant to
the Merger Agreement (i) a new, wholly owned subsidiary of the Company was
merged with and into the Bank, with the Bank as the surviving corporation, (ii)
each outstanding share of Common Stock of the Bank was converted into one share
of Common Stock of the Company, (iii) the Company assumed the Bank Plan, as a
result of which that Plan was amended so that Options then outstanding under the
Bank Plan that had represented a right to purchase shares of Bank Common Stock
were converted into a right to purchase an equal number of Company shares, at
the same exercise price per share, and shares of Common Stock of the Company
were substituted for the shares of Common Stock of the Bank that were reserved
for future grants of Options under the Bank Plan.

     C.   On March 20, 2001, the Board of Directors of the Company took action
to incorporate the aforedescribed amendments to the Bank Plan, together with
certain other amendments, into a single integrated instrument, entitled "The
Pacific Mercantile Bancorp Amended and Restated 1999 Stock Option Plan."  On May
15, 2001, the Company's shareholders approved The Pacific Mercantile Bancorp
Amended and Restated 1999 Stock Option Plan (the "Restated Plan" or the "Plan"),
which is set forth hereinafter in its entirety.

                                    ARTICLE 1
                              PURPOSES OF THE PLAN
                              --------------------

     Purposes.  The purposes of the Plan are (a) to enhance the ability of the
     --------
Company and its Affiliated Companies to attract and retain the services of
officers and qualified employees and directors, upon whose judgment, initiative
and efforts the successful conduct and development of the Company's businesses
largely depends, and (b) to provide additional incentives to such persons to
devote their utmost effort and skill to the advancement and betterment of the
Company, by providing them an opportunity to participate in the ownership of the
Company and thereby have an interest in the success and increased value of the
Company.
<PAGE>

                                    ARTICLE 2
                                   DEFINITIONS
                                   -----------

     For purposes of this Plan, the following terms shall have the meanings
indicated:

     2.1  Administrator.  "Administrator" means the Board or, if the Board
          -------------
delegates responsibility for any matter to the Committee, the term Administrator
shall mean the Committee.

     2.2  Affiliated Company.  "Affiliated Company" means any "parent
          ------------------
corporation" or "subsidiary corporation" of the Company, whether now existing or
hereafter created or acquired, as those terms are defined in Sections 424(e) and
424(f) of the Code, respectively.

     2.3  Board.  "Board" means the Board of Directors of the Company.
          -----

     2.4  Change in Control.  "Change in Control" shall mean (i) the
          -----------------
acquisition, directly or indirectly, by any person or group (within the meaning
of Section 13(d)(3) of the Exchange Act) of the beneficial ownership of
securities of the Company possessing more than fifty percent (50%) of the total
combined voting power of all outstanding securities of the Company, other than
as a result of the acquisition of voting securities of the Company sold by the
Company, solely for cash, in a public offering that has been registered under
the 1933 Act on a registration form other than Form S-4 or a Form equivalent
thereto; (ii) a merger or consolidation in which the Company is not the
surviving entity, unless the persons who were the holders of voting securities
of the Company immediately prior to the effectiveness of such merger or
consolidation own, immediately after the consummation thereof, securities of the
surviving corporation in such transaction, or of the parent company thereof, if
any, possessing more than fifty percent (50%) of the total combined voting power
of all outstanding securities of that surviving corporation or of the parent
company thereof (as the case may be); (iii) a merger in which the Company is the
surviving corporation but as a result of which securities possessing more than
fifty percent (50%) of the total combined voting power of the Company's
outstanding securities are transferred to or acquired by a person or persons
different from the persons holding those securities immediately prior to such
merger; (iv) the sale, transfer or other disposition of all or substantially all
of the assets of the Company to another person or entity (the "acquiring
corporation"), unless the persons who were the holders of voting securities of
the Company immediately prior to the effectiveness of such sale, transfer or
other disposition own, immediately after the consummation of such transaction,
securities of the acquiring corporation, or of its parent company, if any,
possessing more than fifty percent (50%) of the total combined voting power of
all outstanding securities of that acquiring corporation or of the parent
company thereof, as the case may be; or (v) a complete liquidation or
dissolution of the Company.

     2.5  Code.  "Code" means the Internal Revenue Code of 1986, as amended from
          ----
time to time.

     2.6  Committee.  "Committee" means a committee of two or more members of
          ---------
the Board to which administration of the Plan is delegated, as set forth in
Section 6.1 hereof.

     2.7  Common Stock.  Unless otherwise indicated the term "Common Stock"
          ------------
means the Common Stock, no par value, of the Company, subject to adjustment
pursuant to Section 4.2 hereof.

                                       2
<PAGE>

     2.8  Disability.  "Disability" means permanent and total disability as
          ----------
defined in Section 22(e)(3) of the Code.  The Administrator's determination of a
Disability or the absence thereof shall be conclusive and binding on all
interested parties.

     2.9  Exchange Act.  "Exchange Act" means the Securities Exchange Act of
          ------------
1934, as amended.

     2.10 Exercise Price.  "Exercise Price" means the purchase price per share
          --------------
of Common Stock payable upon exercise of an Option.

     2.11 Fair Market Value.   "Fair Market Value" on any given date means the
          -----------------
value of one share of Common Stock, determined as follows:

          (a) If the Common Stock is then listed or admitted to trading on a
     NASDAQ market system or a stock exchange which reports closing sale prices,
     the Fair Market Value shall be the closing sale price on the date of
     valuation on such NASDAQ market system or principal stock exchange on which
     the Common Stock is then listed or admitted to trading, or, if no closing
     sale price is quoted on such day, then the Fair Market Value shall be the
     closing sale price of the Common Stock on such NASDAQ market system or such
     exchange on the next preceding day for which a closing sale price is
     reported.

          (b) If the Common Stock is not then listed or admitted to trading on a
     NASDAQ market system or a stock exchange which reports closing sale prices,
     the Fair Market Value shall be the average of the closing bid and asked
     prices of the Common Stock in the over-the-counter market on the date of
     valuation.

          (c) If neither (a) nor (b) is applicable as of the date of valuation,
     then the Fair Market Value shall be determined by the Administrator in good
     faith using any reasonable method of evaluation, which determination shall
     be conclusive and binding on all interested parties.

     2.12 Incentive Option.  "Incentive Option" means any Option designated and
          ----------------
qualified as an "incentive stock option" as defined in Section 422 of the Code.

     2.13 Incentive Option Agreement.  "Incentive Option Agreement" means an
          --------------------------
Option Agreement with respect to an Incentive Option.

     2.14 NASD Dealer.  "NASD Dealer" means a broker-dealer that is a member of
          -----------
the National Association of Securities Dealers, Inc.

     2.15 1933 Act.  "1933 Act" means the Securities Act of 1933, as amended.
          --------

     2.16 Nonqualified Option.  "Nonqualified Option" means any Option that is
          -------------------
not an Incentive Option.  To the extent that any Option designated as an
Incentive Option fails in whole or in part to qualify as an Incentive Option,
including, without limitation, for failure to meet the limitations applicable to
a 10% Shareholder or because it exceeds the annual limit provided for in Section
5.6 below, it shall to that extent constitute a Nonqualified Option.

     2.17 Nonqualified Option Agreement.  "Nonqualified Option Agreement" means
          -----------------------------
an Option Agreement with respect to a Nonqualified Option.

                                       3
<PAGE>

     2.18 Option.  "Option" means any option to purchase Common Stock granted
          ------
pursuant to the Plan.

     2.19 Option Agreement.  "Option Agreement" means the written agreement
          ----------------
entered into between the Company and the Optionee with respect to an Option
granted under the Plan.

     2.20 Optionee.  "Optionee" means an individual or entity who holds an
          --------
Option.

     2.21 10% Shareholder.  "10% Shareholder" means a person who, as of a
          ---------------
relevant date, owns or is deemed to own (by reason of the attribution rules
applicable under Section 424(d) of the Code) stock possessing more than 10% of
the total combined voting power of all classes of stock of the Company or of an
Affiliated Company.

                                    ARTICLE 3
                                   ELIGIBILITY
                                   -----------

     3.1  Incentive Options.  Officers and other key employees of the Company or
          -----------------
of an Affiliated Company (including members of the Board if they are employees
of the Company or of an Affiliated Company) are eligible to receive Incentive
Options under the Plan.

     3.2  Nonqualified Options.  Officers and other key employees, and members
          --------------------
of the Board of the Company or of an Affiliated Company (whether or not they are
employed by the Company or an Affiliated Company), are eligible to receive
Nonqualified Options under the Plan.

     3.3  Limitation on Shares.  In no event shall any Optionee be granted
          --------------------
Options in any one calendar year pursuant to which the aggregate number of
shares of Common Stock that may be acquired thereunder exceeds two hundred
thousand (200,000) shares.

                                    ARTICLE 4
                                   PLAN SHARES
                                   -----------

     4.1  Shares Subject to the Plan.  The number of shares of Common Stock that
          --------------------------
have been authorized for issuance under the Plan (after giving effect to
adjustment made pursuant to Section 4.2 hereof) is 1,248,230 shares.  That
number and kind of shares shall be subject to adjustment hereafter pursuant to
Section 4.2 hereof.  For purposes hereof, in the event that (a) all or any
portion of any Option granted under the Plan can no longer under any
circumstances be exercised, or (b) any shares of Common Stock that were acquired
on exercise of an Option granted under the Plan are reacquired by the Company,
the shares of Common Stock allocable to the unexercised portion of such Option,
or the shares so reacquired, shall again be available for grant or issuance
under the Plan.

     4.2  Changes in Capital Structure.  In the event that the outstanding
          ----------------------------
shares of Common Stock are hereafter increased or decreased or changed into or
exchanged for a different number or kind of shares or other securities of the
Company by reason of a stock split, combination of shares, reclassification,
stock dividend, or other similar change in the capital structure of the Company,
then appropriate adjustments shall be made by the Administrator to the aggregate
number and kind of shares subject to this Plan, and to the number and kind of
shares and the price per share subject to outstanding Option Agreements, in
order to preserve, as nearly as practical, but not to increase, the benefits to
Optionees.

                                    ARTICLE 5
                                     OPTIONS
                                     -------

                                       4
<PAGE>

     5.1  Option Agreement.  Each Option granted pursuant to this Plan shall be
          ----------------
evidenced by an Option Agreement which shall specify the number of shares
subject thereto, the Exercise Price per share, and whether the Option is an
Incentive Option or Nonqualified Option.  As soon as is practical following the
grant of an Option, an Option Agreement shall be duly executed and delivered by
or on behalf of the Company to the Optionee to whom such Option was granted.
Each Option Agreement shall be in such form and contain such additional terms
and conditions, not inconsistent with the provisions of this Plan, as the
Administrator shall, from time to time, deem desirable, including, without
limitation, the imposition of any rights of first refusal and resale obligations
upon any shares of Common Stock acquired pursuant to an Option Agreement.  Each
Option Agreement may be different from each other Option Agreement.

     5.2  Exercise Price.  The Exercise Price per share of Common Stock covered
          --------------
by each Incentive and each Nonqualified Option shall be determined by the
Administrator, but in no event shall such Exercise Price be less than one
hundred percent (100%) of Fair Market Value on the date the Option is granted,
provided, however, that the Exercise Price of any Incentive Option granted to a
--------  -------
person that is a 10% Shareholder on the date of grant shall not be less than one
hundred ten percent (110%) of Fair Market Value on the date the Option is
granted.

     5.3  Payment of Exercise Price.  Payment of the Exercise Price shall be
          -------------------------
made upon exercise of an Option and may be made, in the discretion of the
Administrator, subject to any legal restrictions, by cash or check; or, subject
to the approval of the Administrator by any of the following methods of payment:
(a) the surrender of shares of Common Stock owned by the Optionee that have been
held by the Optionee for at least six (6) months, which surrendered shares shall
be valued at Fair Market Value as of the date of such exercise; (b) the
Optionee's promissory note in a form and on terms acceptable to the
Administrator; (c) the cancellation of indebtedness of the Company to the
Optionee; (d) the waiver of compensation due or accrued to the Optionee for
services rendered.  In addition, provided that a public market for the Common
Stock exists, payment may be made by means of: (x) a "same day sale" commitment
from the Optionee and an NASD Dealer whereby the Optionee irrevocably elects to
exercise the Option and to sell a portion of the shares so purchased to pay for
the Exercise Price and whereby the NASD Dealer irrevocably commits upon receipt
of such shares to forward the Exercise Price directly to the Company; or (y) a
"margin" commitment from the Optionee and an NASD Dealer whereby the Optionee
irrevocably elects to exercise the Option and to pledge the shares so purchased
to the NASD Dealer in a margin account as security for a loan from the NASD
Dealer in the amount of the Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of such shares to forward the Exercise Price
directly to the Company.  With the approval of the Administrator, payment may
also be made by any combination of the foregoing methods of payment or any other
consideration or method of payment as shall be permitted by applicable corporate
and banking laws.

     5.4  Vesting and Exercise of Options.  Each Option shall vest and become
          -------------------------------
exercisable in one or more installments at such time or times and subject to
such conditions as shall be determined by the Administrator in its sole
discretion (and which may but need not include, without limitation, the
achievement of specified performance goals or objectives).  The Administrator
also shall have discretion, from time to time, to accelerate the vesting of any
Options held by Optionee who, at the time of such action, is eligible to be
granted Options under this Plan.

     5.5  Term and Termination of Options.  The term and provisions for
          -------------------------------
termination of each Option shall be as fixed by the Administrator, but no Option
(whether it is an Incentive Option or a Nonqualified Option) may be exercisable
more than ten (10) years after the date it is granted, except that an Incentive
Option granted to a person who is a 10% Shareholder on the date of grant shall
not

                                       5
<PAGE>

be exercisable more than five (5) years after the date it is granted. In the
event there is a termination, for any reason, of (i) the employment of any
employee of the Company or any Affiliated Company who at the time of such
termination is an Optionee, or (ii) the term of office of any non-employee
director of the Company who is then an Optionee, then, unless such employee-
Optionee is and continues to serve or, within the succeeding 10 days is elected
or appointed, as a Director of the Company, or any such Director-Optionee is and
continues to be or within the succeeding 10 days is employed as, an employee of
the Company or any Affiliated Company):

          (a) upon any such termination, all unvested options held by such
     Optionee shall automatically terminate without ever having become
     exercisable;

          (b) if such termination occurred for any reason other than the death
     or Disability of the Optionee, then any options of such Optionee that had
     become vested prior to the date of such termination shall continue to be
     exercisable for the period of time, if any, following such termination as
     is set forth in such Optionee's Option Agreement, but in no event shall
     such period of time exceed three (3) from the date of such termination; and

          (c) if such termination was due to the death or Disability of the
     Optionee, then any options of such Optionee that had become vested prior to
     the date of such termination shall continue to be exercisable, by the
     Optionee's estate or heirs (as the case may be) in the case of the death of
     the Optionee and, otherwise, by the Optionee, for the period of time, if
     any, following such termination as is set forth in such Optionee's Option
     Agreement, but in no event shall such period of time exceed twelve (12)
     months from the date of such termination;

     5.6  Annual Limitation on Incentive Options.  The following shall apply to
          --------------------------------------
Incentive Options granted to any Optionee under the Plan, but only to the extent
required to provide for "incentive stock option" treatment of such Options under
Section 422 of the Code:  The aggregate Fair Market Value (determined as of the
time of grant) of the shares of Common Stock that are subject to the Incentive
Options granted to such Optionee under this Plan, together with the aggregate
Fair Market Value of any other Incentive Options that have been granted to the
same Optionee (also determined as of the respective dates of grant thereof)
under any other option plan of the Company or any Affiliated Company, that may
become exercisable for the first time during any calendar year, shall not exceed
$100,000; provided that, notwithstanding anything to the contrary that may be
          --------
contained in the action taken by the Administrator in granting such Incentive
Options or in the Incentive Option Agreements evidencing such grants, the
Incentive Options that cause such Fair Market Value to exceed this annual
limitation shall be treated as Nonqualified Options.

     5.7  Non-Transferability of Options.  No Option shall be assignable or
          ------------------------------
transferable except by will or the laws of descent and distribution, and during
the life of the Optionee shall be exercisable only by such Optionee; provided,
                                                                     --------
however, that, in the discretion of the Administrator, any Option may be
-------
assigned or transferred in any manner which an "incentive stock option" is
permitted to be assigned or transferred under the Code.

     5.8  Rights as Shareholder.  An Optionee or permitted transferee of an
          ---------------------
Optionee shall have no rights or privileges as a shareholder with respect to any
shares covered by an Option until the Option has been duly exercised and
certificates for the shares purchased have been issued to such Optionee or
permitted Transferee.

                                       6
<PAGE>

                                    ARTICLE 6
                           ADMINISTRATION OF THE PLAN
                           --------------------------

     6.1  Administrator.  Authority to control and manage the operation and
          -------------
administration of the Plan shall be vested in the Board, which may delegate such
responsibilities in whole or in part to a committee consisting of two (2) or
more members of the Board (the "Committee").  Members of the Committee may be
appointed from time to time by, and shall serve at the pleasure of, the Board.
As used herein, the term "Administrator" means the Board or, with respect to any
matter as to which responsibility has been delegated to the Committee, the term
Administrator shall mean the Committee.

     6.2  Powers of the Administrator.  In addition to any other powers or
          ---------------------------
authority conferred upon the Administrator elsewhere in the Plan or by law, the
Administrator shall have full power and authority:  (a) to determine the persons
to whom, and the time or times at which, Incentive Options or Nonqualified
Options shall be granted, the number of shares to be represented by each Option
and the consideration to be received by the Company upon the exercise thereof;
(b) to interpret the Plan and to create, amend or rescind rules and regulations
relating to the Plan; (c) to determine the terms, conditions and restrictions
contained in Option Agreements evidencing the grant of Options under this Plan;
(d) to determine the identity or capacity of any persons who may be entitled to
exercise an Optionee's rights under any Option under the Plan; (e) to correct
any defect or supply any omission or reconcile any inconsistency in the Plan or
in any Option Agreement; (f) to accelerate the vesting of any Option held by a
person then eligible to receive a grant of Options under the Plan; (g) to extend
the exercise date of any Option held by a person then eligible to receive a
grant of Options under the Plan; (h) to provide for rights of first refusal
and/or repurchase rights; (i) to amend outstanding Option Agreements to provide
for, among other things, any change or modification which the Administrator
could have provided for upon the grant of an Option or in furtherance of the
foregoing powers, provided, however, that no such amendment that adversely
                  --------  -------
affects any material rights of any Optionee under any Option Agreement entered
into with the Optionee prior to the adoption of such amendment shall be
effective with respect to the Options granted under such Agreement; and (j) to
make all other determinations necessary or advisable for the administration of
the Plan, but only to the extent not contrary to the express provisions of the
Plan.  Any action, decision, interpretation or determination made in good faith
by the Administrator in the exercise of its authority conferred upon it under
the Plan shall be final and binding on the Company and all Optionees.

     6.3  Limitation on Liability.  No employee of the Company or member of the
          -----------------------
Board or Committee shall be subject to any liability with respect to duties
under the Plan unless the person acts fraudulently or in bad faith.  To the
extent permitted by law, the Company shall indemnify each member of the Board or
Committee, and any employee of the Company with duties under the Plan, who was
or is a party, or is threatened to be made a party, to any threatened, pending
or completed proceeding, whether civil, criminal, administrative or
investigative, by reason of such person's conduct in the performance of duties
under the Plan.

                                    ARTICLE 7
                                CHANGE IN CONTROL
                                -----------------

     7.1  Change in Control.  In order to preserve an Optionee's rights in the
          -----------------
event of a Change in Control of the Company, (i) if a Change of Control of the
Company is consummated, then, the time period relating to the exercise or
realization of all outstanding Options shall automatically accelerate effective
immediately prior to the consummation of such Change in Control; and (ii) with

                                       7
<PAGE>

respect to Options, the Administrator in its discretion may, at any time an
Option is granted, or at any time thereafter, take one or more of the following
actions:  (A) provide for the purchase or exchange of each Option for an amount
of cash or other property having a value equal to the difference, or spread,
between (x) the value of the cash or other property that the Optionee would have
received pursuant to such Change in Control transaction in exchange for the
shares issuable upon exercise of the Option had the Option been exercised
immediately prior to such Change in Control transaction and (y) the Exercise
Price of such Option, (B) adjust the terms of the Options in a manner determined
by the Administrator to reflect the Change in Control, (C) cause the Options to
be assumed, or new rights substituted therefor, by another entity, through the
continuance of the Plan and the assumption of outstanding Options, or the
substitution for such Options of new options of comparable value covering shares
of a successor corporation, with appropriate adjustments as to the number and
kind of shares and Exercise Prices, in which event the Plan and such Options, or
the new options substituted therefor, shall continue in the manner and under the
terms so provided, or (D) make such other provision as the Administrator may
consider equitable.  If and to the extent that any of the outstanding Options
are not exercised effective immediately prior to the consummation of a Change in
Control of the Company, and such Options are not assumed by the company or other
entity surviving such Change in Control, then all such unexercised Options shall
terminate effective as of the consummation of the Change in Control.

     7.2  Notice of Change in Control.  The Administrator shall cause written
          ---------------------------
notice of any proposed Change in Control of the Company to be given to all
Optionees not less than fifteen (15) days prior to the anticipated effective
date of the proposed Change in Control transaction; provided, however, that the
                                                    --------  -------
failure to give such notice shall not affect the validity of, nor shall any
Optionee have the right to obtain a postponement in the consummation of any such
Change in Control transaction by reason of any failure to have given or any
delay in having given such notice.  Instead, the sole recourse of any Optionee
for any such failure of or delay in giving such notice shall be as follows:  (i)
if the terms of the Change in Control transaction provide for all outstanding
Company shares or Options to converted into a right to receive cash or other
property, such Optionee shall be entitled to receive the cash or other property
he or she would have received effective as of date of consummation of such
Change in Control transaction, had he or she been given such notice and had
exercised or surrender his or her Options effective on or immediately prior to
the consummation of such transaction; or (ii) if the Change in Control
transaction provides for outstanding Options to be assumed by the surviving or
acquiring company or entity in such transaction, to retain such Optionee's
Options, and (iii) if the Change in Control transaction provides for the
surviving or acquiring company is to substitute other options for the Optionee's
Options, to receive such substitute options from the surviving or acquiring
entity in any such Change in Control Transaction.

                                    ARTICLE 8
                      AMENDMENT AND TERMINATION OF THE PLAN
                      -------------------------------------

     8.1  Amendments.  The Board may from time to time alter, amend, suspend or
          ----------
terminate the Plan in such respects as the Board may deem advisable.  No such
alteration, amendment, suspension or termination shall be made which shall
substantially and adversely affect or impair the rights of any Optionee under an
outstanding Option Agreement without such Optionee's consent.  The Board may
alter or amend the Plan to comply with requirements under the Code relating to
Incentive Options or other types of options which give Optionees more favorable
tax treatment than that applicable to Options granted under this Plan as of the
date of its adoption.  Upon any such alteration or amendment, any outstanding
Option granted hereunder may, if the Administrator so determines and if
permitted by applicable law, be subject to the more favorable tax treatment
afforded to an Optionee pursuant to such terms and conditions.

                                       8
<PAGE>

     8.2  Plan Termination.  Unless the Plan shall theretofore have been
          ----------------
terminated, the Plan shall terminate on February 28, 2009, which is within ten
years of the date the 1999 Stock Option Plan was originally adopted by the Board
of Directors of the Bank.  No Options may be granted under the Plan thereafter,
but Option Agreements then outstanding shall continue in effect in accordance
with their respective terms.

                                    ARTICLE 9
                                 TAX WITHHOLDING

     9.1  Withholding.  The Company shall have the power to withhold, or require
          -----------
a Optionee to remit to the Company, an amount sufficient to satisfy any
applicable Federal, state, and local tax withholding requirements with respect
to any Options exercised under the Plan.  To the extent permissible under
applicable tax, securities and other laws, the Administrator may, in its sole
discretion and upon such terms and conditions as it may deem appropriate, permit
an Optionee to satisfy his or her obligation to pay any such tax, in whole or in
part, up to an amount determined on the basis of the highest marginal tax rate
applicable to such Optionee, by (a) directing the Company to apply shares of
Common Stock to which the Optionee is entitled as a result of the exercise of an
Option or (b) delivering to the Company shares of Common Stock owned by the
Optionee.  The shares of Common Stock so applied or delivered in satisfaction of
the Optionee's tax withholding obligation shall be valued at their Fair Market
Value as of the date of measurement of the amount of income subject to
withholding.

                                   ARTICLE 10
                                  MISCELLANEOUS
                                  -------------

     10.1 Benefits Not Alienable.  Other than as provided above, benefits under
          ----------------------
the Plan may not be assigned or alienated, whether voluntarily or involuntarily.
Any unauthorized attempt at assignment, transfer, pledge or other disposition
shall be without effect.

     10.2 No Enlargement of Employee Rights.  This Plan is strictly a voluntary
          ---------------------------------
undertaking on the part of the Company and shall not be deemed to constitute a
contract between the Company and any Optionee to be consideration for, or an
inducement to, or a condition of, the employment of any Optionee.  Nothing
contained in the Plan shall be deemed to give the right to any Optionee to be
retained as an employee of the Company or any Affiliated Company or to limit the
right of the Company or any Affiliated Company to discharge any Optionee at any
time.

     10.3 Application of Funds.  The proceeds received by the Company from the
          --------------------
sale of Common Stock pursuant to Option Agreements, except as otherwise provided
herein, will be used for general corporate purposes.

                                   ARTICLE 11
                            EFFECTIVENESS OF THE PLAN
                            -------------------------

     11.1 Effectiveness of the Bank Plan and Restated Plan.  The effective date
          ------------------------------------------------
of the Plan is March 2, 1999, which also is the date that the granting of
Options under the Plan first commenced.  Approval of the Plan by the
shareholders, which was required for its continued effectiveness, was satisfied
on January 11, 2000, which was less than one year following the Plan's
effectiveness.

                                       9