**Exhibit 10iii.6**

** **

**ILLINI CORPORATION**

**DIRECTORS’ STOCK OPTION PLAN**

 

 

# SECTION I

 

This Directors’Stock Option Plan for ILLINI CORPORATION is intended to advance the interestsof the Organization by providing members of the Board of Directors who haveresponsibility for the direction and management of the Company and itsSubsidiaries with additional incentive to promote the success of theOrganization’s business, and by encouraging the Directors to remain on theBoard of the Organization.  The aboveaims will be accomplished through the granting of certain stock options.

 

 

# SECTION II

 

The items definedbelow shall have the following meanings throughout the Plan:

 

 

2.1           “Board” means the Board of Directorsof Company or Bank.

 

2.2           “Company” means ILLINI CORPORATION,an Illinois corporation.

 

2.3           “Directors “ means members elected tothe Board of Directors of the Company or the Subsidiaries, who haveresponsibility for the direction and management of the Organization.

 

2.4           “Organization” means the Company andthe Subsidiaries.

 

2.5           “Optionee” means the person to whoman option is granted.

 

2.6           “Plan” means the Directors’ OptionPlan as defined by the provisions hereof.

 

2.7           “Stock” means the voting common stockof Company.

 

2.8           “Subsidiaries” means any subsidiarybank or corporation owned or controlled by the Company, or one of theSubsidiaries.

 

# SECTION III

 

The Board shalladminister the Plan.  Subject to theprovisions of the Plan, the Board shall have the authority, in its sole andabsolute discretion, to:  (a) determinethe directors of the Organization to whom options shall be granted; (b)determine the time or times at which options shall be granted; (c) determinethe option price of the shares subject to each option, which price shall not beless than the minimum specified in Section 6.1; (d) determine (subject toSection 6.2) the duration of the exercise period for each option subject to thevesting limitations of the

 

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Plan; (e) determine the form of options granted hereunder; and (f)interpret the Plan and to prescribe, amend, and rescind rules and regulationsrelating to it.  For purposes of actingwith respect to the Plan, a majority of the members of the Board shallconstitute a quorum and the acts of a majority of the members present at anymeeting at which a quorum is present, or acts approved in writing by a majorityof the members of the Board, shall be deemed the acts of the Board.  Members of the Board being considered foroptions shall not vote on a resolution to determine whether he or she shall begranted any option hereunder.

 

# SECTION IV

 

4.1            Options shall begranted only to Directors.

 

4.2            Options grantedunder the Plan may be exercised in whole or in part throughout the duration ofthe exercise period for each option set by the Board subject to the followingvesting requirements:

 

(a)   Twentypercent of the shares of Common Stock which may be purchased pursuant to anOption, shall be available for purchase on or after one (1) year from the dateof grant;

 

(b)   Twentypercent of the shares of Common Stock which may be purchased pursuant to anOption, shall be available for purchase on or after two (2) years from the dateof grant;

 

(c)   Twentypercent of the shares of Common Stock which may be purchased pursuant to anOption, shall be available for purchase on or after three (3) years from thedate of grant;

 

(d)   Twentypercent of the shares of Common Stock which may be purchased pursuant to anOption, shall be available for purchase on or after four (4) years from thedate of grant; and

 

(e)   Twenty percentof the shares of Common Stock which may be purchased pursuant to an Option,shall be available for purchase on or after five (5) years from the date ofgrant.

 

In the event oftermination of membership on the Board of Directors for any reason other thandeath, the shares of Common Stock which may be purchased pursuant to an Optionshall be limited to number of shares which are fully vested and available forpurchase under this Section 4.2 as of the date and time of termination of suchBoard membership.  In the event of thedeath of an Optionee, all shares of Common stock which may be purchasedpursuant to an Option held by the Optionee shall be deemed fully vested andavailable for purchase.

 

4.3            In the event of a“Change of Control” of the Company, as such term is defined under theregulations of the Board of Governors of the Federal Reserve System, all sharesof

 

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Common Stock which may be purchased pursuant to an Option shall bedeemed fully vested and available for purchase.

 

# SECTION V

 

5.1            The maximum numberof shares of Stock which may be issued pursuant to options granted hereunder(subject to adjustment as provided in Section 5.3 hereof) shall be 7,500 sharesand, to the extent allowed by law, said number of shares will be reserved foruse upon the exercise of options which may be granted at any time and from timeto time under the Plan (subject to the provisions of Section 10).  These shares may be in whole or in part, asthe Board shall from time to time determine, authorized but unissued shares orunauthorized shares which may be authorized pursuant to powers of attorneygranted by shareholders of the Company. Any shares subject to an option under the Plan, which option for anyreason expires or is terminated unexercised as to such shares, may again besubjected to an option under the Plan.

 

5.2            In the event thatadditional shares of Stock are issued pursuant to a stock split or a stockdividend, the number of shares of Stock then covered by each outstanding optiongranted hereunder shall be increased proportionally and the per share price ofsuch shares shall be decreased proportionally with no change in the totalpurchase price of the shares then so covered. The number of shares of Stock reserved for the purpose of the Plan shallalso be increased proportionally.  Inthe event that the shares of Stock of the Company from time to time issued andoutstanding are reduced by a combination of shares, the number of shares ofStock then covered by each outstanding option granted hereunder shall bereduced proportionally and the per share price shall be increasedproportionally with no change in the total price of the shares then socovered.  The number of shares of Stockreserved for the purposes of the Plan shall also be reducedproportionally.  No fractional sharesshall be issued, and any fractional shares resulting from the computationspursuant to this Section 5.2 shall be eliminated from the respective option.  No adjustment shall be made for dividends(other than stock dividends) or the issuance to stockholders of rights tosubscribe for additional common stock or other securities.

 

# SECTION VI

 

6.1            The option pricefor each share of Stock covered by an option shall be an amount not less than 100%of the fair market value of the Stock on the date the option is granted.

 

6.2            All options issuedunder the Plan shall be for such period as the Board shall determine, but fornot more than ten (10) years from the date of grant thereof.

 

6.3            The period of theoptions, once granted, may be reduced only as provided for in Section 7 inconnection with the termination of Board membership of the Optionee.

 

6.4            Except as providedin Section 7 hereof, no option may be exercised unless the Optionee is at thetime of such exercise a member of a Board of Directors of the Organization andshall have been continuously such a member since the grant of the option.

 

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6.5            Each option grantedunder the Plan shall be non-transferable and shall be exercisable only by theOptionee to whom the option is granted. No option granted under the Plan or any of the rights and privilegesthereby conferred shall be transferred, assigned, pledged, or hypothecated inany way (whether by operation of law or otherwise), and no such option, right,or privilege shall be subject to execution, attachment, or similarprocess.  Upon any attempt to sotransfer, assign, pledge, hypothecate, or otherwise dispose of the option or ofany right or privilege conferred thereby, contrary to the provisions hereof, orupon the levy of any attachment or similar process upon such option, right orprivilege, the option and such rights and privileges shall immediately becomenull and void.

 

# SECTION VII

 

7.1            In the event of anOptionee’s termination of Board membership for any reason, such Optionee or theOptionee’s guardian or personal representative may exercise any Optionstheretofore granted, which have vested and are not then expired, within three(3) months after such termination; provided, however, in the case oftermination due to permanent disability, the three month period of exerciseshall be extended to one year.

 

# SECTION VIII

 

8.1            The exercise of anyoption shall also be contingent upon receipt by the Company of cash orcashier’s check to its order, in an amount equal to the full option price ofthe shares being purchased.

 

8.2            No Optionee or hisor her legal representative, heir, or legatee, as the case may be, will be, orwill be deemed to be, a holder of any share subject to an option unless anduntil appropriate documents evidencing such shares are issued under theprovisions of the Plan.  Adjustmentshall be made, however, for dividends for which the record date is after thedate the option is exercised but prior to the date such evidence of such sharesis issued.

 

8.3            Each option shallbe subject to the condition that if at any time the Board shall determine, inits discretion, that the listing, registration, or qualification of the sharescovered thereby upon any securities exchange or under any state or federal lawor that the consent or approval of any governmental regulatory body isnecessary or desirable as a condition of, or in connection with, the issue orpurchase of shares under such option, such shares will not be issued unless anduntil such listing, registration, qualification, consent, or approval shallhave been effected or obtained free of any conditions not acceptable to theBoard.

 

8.4            Exercise of anoption shall result in a decrease in the number of shares of Stock whichthereafter may be available under the Plan by the number of shares as to whichthe option is exercised.

 

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# SECTION IX

 

No option shall be granted pursuant to the Plan after ten (10) yearsfrom the date the Plan is adopted by the majority of the outstanding shares ofeach class of Company stock.

 

# SECTION X

 

The Board may atany time terminate the Plan, and at any time and from time to time modify andamend the Plan in any respect; provided, however, that no such amendmentshall:  (a)increase (except inaccordance with Section 5.2) the maximum number of shares for which options maybe granted under the Plan either in the aggregate or to any individualOptionee; or (b) reduce (except in accordance with Section 5.2) the minimumoption prices which may be established under the Plan; or (c) extend themaximum periods provided for in Sections 6.2 and 10, respectively, during whichoptions may be exercised or granted; or (d) change the provisions relating tothe determination of employees to whom options shall be granted and the numberof shares to be covered by such options; or (e) change the provisions relatingto adjustments to be made upon changes in capitalization.  The termination or any modification oramendment of the Plan shall not, without the consent of an Optionee, affect hisor her rights under an option theretofore granted to such Optionee.

 

# SECTION XI

 

The Plan shall not affect the provisions of any qualified or non-qualifiedstock options granted to any director or employee of the Organization under anyother plan relating to stock options; nor shall it affect any of the rights ofany employee or the Organization to whom such a non-qualified stock option wasgranted.

 

# SECTION XII

 

This Plan shall become effective on the later of the date of itsadoption by the Board or its approval by the vote of the holders of a majorityof the outstanding shares of each class of the Company’s stock.  This Plan shall not become effective unlesssuch shareholder approval shall be obtained within twelve (12) months before orafter the adoption of the Plan by the Board.

 

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