Exhibit 10.4


 


NATIONAL
MERCANTILE BANCORP


 


1996 Stock Option Plan


Incentive Stock Option Agreement


 


This INCENTIVE STOCK OPTION
AGREEMENT (the “Agreement”) is made as of the xxth day of Month, 200x between
NATIONAL MERCAN­TILE BANCORP, a California corporation (the “Company”), and
OPTIONEE  (the “Optionee”).


 


R
E C I T A L S


 


A.            The Board of Directors of the
Company adopted the 1996 Stock Incentive Plan (the “1996 Plan”) on March 28,
1996 and April 25, 1997, and the 1996 Plan was approved by the shareholders of
the Company on June 18, 1997 and amendments to the 1996 Plan were approved by
shareholders on April 23, 1998, April 29, 1999, April 26, 2001, June 6, 2002
and May 29, 2003.


 


B.            The
1996 Plan provides for the granting of options to purchase shares of Common
Stock of the Company to directors, officers, employees or independent
contractors of the Company or any subsidiary of the Company, as the Stock
Option Committee (the “Committee”) appointed by the Board of Directors may from
time to time determine, and, pursuant to Section 10 of the 1996 Plan, an
automatic grant to new directors of the Company who are not also employees of
the Company.


 


C.            The
Committee has determined that it is in the best interests of the Company and
its shareholders to grant, pursuant to the 1996 Plan, an incentive stock option
to the Optionee to purchase NUMBER OF SHARES (xxx) shares of the Company’s
Common Stock on the terms and conditions hereinafter set forth.


 


D.            The
option granted hereby is intended to qualify as an “incentive stock option”
under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”),
to the extent possible.


 


NOW, THEREFORE, the parties
hereto agree as follows:


 


1.             GRANT
OF OPTION.  The Company hereby grants
to the Optionee as of the date hereof (the “Date of Grant”) an incentive stock
option (the “Option”) to purchase, on the terms and conditions hereinafter set
forth, NUMBER OF SHARES (xxx) shares of the Company’s Common Stock, no par
value (the “Option Shares”), at a purchase price of $xx.xx per share.


 


2.             VESTING. 
The Option shall vest and become exercisable as follows:


 


xxx
shares on or after DATE


 


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provided, however, that no
portion of the Option may be exercised by the Optionee to the extent that such
exercise would cause an ownership change to occur pursuant to Section 382 of
the Code.  Section 382 of the Code
provides, among other things, that utilization of net operating losses will be
restricted if there is a change in ownership of the loss corporation.  Changes in ownership are determined by
reference to 5% shareholders.


 


3.             EXPIRATION OF OPTION AND CERTAIN LIMITATIONS ON RIGHT
TO EXERCISE.


 


(a)           The Option shall expire on the tenth anniversary of the
Date of Grant (the “Expiration Date”), except that (i) if the Optionee ceases,
on or before the Expiration Date, for any reason other than death or permanent
disability, to be employed by the Company or a subsidiary of the Company, the
Option shall expire as provided in Section 6 below, and (ii) if the
Optionee ceases, on or before the Expiration Date, to be employed by the
Company or a subsidiary of the Company, by reason of death or permanent
disability, the Option shall expire as provided in Section 7 below.  The term “Employee” as used in this Option
means an officer or other employee of the Company or any subsidiary (including
an officer who is also a director of the Company or any subsid­iary).


 


(b)           The Option may be exercised in whole or in part from time
to time on or after December 30, 2004 until the Expiration Date (subject to the
provisions hereof), except that not less than one hundred (100) shares may be
purchased at any time unless the number of shares then purchasable hereunder
shall be less than one hundred.


 


(c)           Except as provided in Sections 6 and 7 below, none of
the Option Shares may be purchased hereunder unless the Optionee, at the time
he exercises the Option, is employed by the Company or a subsidiary of the Company,
since the date hereof.  A leave of
absence approved in writing by the Committee shall not be deemed a termination
of employment for any purpose of this Option.


 


4              METHOD OF EXERCISE OF OPTION.  The Option may be exercised only by delivery
to the Company of a written notice of exercise specifying the number of Option
Shares which the Optionee then elects to purchase, accompanied by payment in
full of the aggregate exercise price for such shares (the “Exercise Price”), in
cash or by check payable to the Company, or in shares of the Company’s Common
Stock, represented by a certificate duly endorsed, transferring to the Company
good and valid title to such shares, such shares to be valued on the basis of
the aggregate Fair Market Value (as defined in the 1996 Plan) thereof on the
date of such exercise.


 


5              NON-TRANSFERABILITY OF OPTION.  The Option shall not be transferable by the
Optionee otherwise than by will or the laws of descent and distribution, and it
shall be exercisable, during the lifetime of the Optionee only by him or by his
guardian or legal representative regardless of any community property interest
therein of the spouse of the Optionee or such spouse’s successors in interest.


 


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6.             TERMINATION OF EMPLOYMENT.


 


(a)            If the Optionee ceases to be
employed by the Company or a subsidiary of the Company for any reason other
than death or permanent disability, the Option shall expire three (3) months
after the date the Optionee ceases to be so employed, unless by its terms it
expires sooner.  The Option may be
exercised by the Optionee within such three month period to the extent it was
exercisable on the date of such cessation of employment.


 


(b)            The Option confers no right upon the
Optionee with respect to the continuation of his employment with the Company or
any of its subsidiaries, and shall not interfere with the right of the Company
or a subsidiary, or of the Optionee, to terminate his employ­ment at any time.


 


7.             DEATH OR PERMANENT DISABILITY OF OPTIONEE.  If the Optionee ceases to be employed by the
Company or a subsidiary of the Company by reason of death or permanent
disability, the Option shall expire one (1) year after the date of such death
or disability, unless by its terms it expires sooner.  The Option may be exercised only by the heirs
of the Optionee within such one year period to the extent it was exercisable on
the date of such death or disability.


 


8.             ADJUSTMENTS UPON THE OCCURRENCE OF CERTAIN EVENTS.


 


(a)           If the
outstanding shares of the Company’s Common Stock are increased, decreased, or
exchanged for or converted into cash, property or a different number or kind of
shares or securities of the Company through reorganization, recapitalization,
reclassification, merger, consolidation, restructuring, stock dividend, stock
split, reverse stock split or other similar transaction, or if substantially
all of the property and assets of the Company are sold, then, unless the terms
of such transaction provide otherwise, an appropriate and proportionate
adjustment shall be made in the Option Shares pursuant to which the Options
relate.  Any such adjustment in the
outstanding Options shall be made without change in the aggregate purchase
price applicable to the unexercised portion of the Options but with a corresponding
adjustment in the price for each Option Share.


 


(b)           No adjustment
provided for in this Section 8 shall require the Company to sell a fractional
share under the Options.


 


9.             DELIVERY OF STOCK CERTIFICATES.  Upon the exercise of all or a portion of the
Option, the Company, as promptly as practicable, shall mail or deliver to the
Optionee a stock certificate or certificates representing the shares then
purchased, and will pay all stamp taxes payable in connection therewith.  The issuance of such shares and delivery of
the certificate or certificates therefor shall, however, be subject to any
delay necessary to complete (a) the listing of such shares on any stock
exchange upon which shares of the same class are then listed or quoted on the
Nasdaq, (b) such registration or other qualification of such shares under any
state or federal law, rule, or regulation as the Company may determine to be
necessary or advisable, and (c) the making of provision for the payment or
withholding of any taxes required to be withheld pursuant to any applicable
law, in respect of the exercise of the Option or the receipt of such shares.


 


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10.           NOTICES, ETC.


 


(a)
           Any notice hereunder by the
Optionee shall be given to the Company in writing and such notice and any
payment by the Optionee hereunder shall be deemed duly given or made only upon
receipt thereof at the Company’s corporate offices at 1840 Century Park East,
Los Angeles, California 90067, or at such other address as the Company may
designate by notice to the Optionee.


 


(b)            Any notice or other communication to
the Optionee shall be in writing and any such communication and any delivery to
the Optionee hereunder shall be deemed duly given or made if mailed or
delivered to the Optionee at such address as the Optionee shall have on file
with the Company or in care of the Company at the address of its corporate
offices indicated above.


 


11.           WAIVER.  The
waiver by the Company of any provision of the Option shall not operate as or be
construed to be a waiver of the same pro­vision or any other provision hereof
at any subsequent time or for any other purpose.


 


12.           IRREVOCABILITY. 
The Option shall be irrevocable until it expires as herein provided.


 


13.           EFFECTIVE DATE. 
The Option shall be deemed granted and effec­tive on the Date of Grant.


 


14.           INTERPRETATION AND CONSTRUCTION.  The interpretation and construction of the
Option by the Committee shall be final, binding and conclu­sive.  The section headings in this Agreement are
for convenience of reference only and shall not be deemed part of, or germane
to the interpretation or construction of, this Agreement.


 


 


	
   

  	
  NATIONAL MERCANTILE
  BANCORP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Scott A. Montgomery

  
	
   

  	
   

  	
  President & CEO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Optionee

  
					



 


By his or her signature below, the spouse of
the Optionee agrees to be bound by all of the terms and conditions of the
foregoing Agreement.


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Spouse of Optionee

  
				



 


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