ex4-3.htm


    Exhibit
4.3

     

    Valley
Commerce Bancorp

     

    2007
Equity Incentive Plan

     

    Restricted
Share Award Agreement

     

     Valley
Commerce Bancorp, a California corporation and a registered bank holding company
under the Bank Holding Company Act of 1956 (the “Company”), and the undersigned
employee of Company (the “Employee”) have entered into
this Restricted Share Award Agreement (the “Award Agreement”) effective as of
the Grant Date set forth below.  The Company has granted to Employee
the number of shares (the “Shares”) of common stock, no
par value, of the Company (the “Stock”) set forth below
subject to the restrictions stated below and as hereinafter set
forth.  The Shares were awarded under the Company’s 2007 Equity
Incentive Plan, as the same may be amended, modified, supplemented or
interpreted from time to time (the “Plan”), which is incorporated
herein by reference and to which this Award Agreement is subject in all
respects.

     

    
      
        	
                Employee
      Name:

              	
                _____________________

              
	
                Grant
      Date:

              	
                _____________________

                MM/DD/YYYY

              
	
                Expiration
      Date:

              	
                _____________________

                MM/DD/YYYY

              
	
                Number
      of Shares:

              	
                _____________

              
	 
      	 
      


      

    

    1.           Terms of Plan.  All
capitalized terms used in this Award Agreement and not otherwise defined shall
have the meanings ascribed thereto in the Plan. Employee confirms and
acknowledges that Employee has received and reviewed a copy of the
Plan.   The Plan is administered by the Compensation Committee of
the Board of Directors (the “Committee”) which has complete authority to make
all determinations with respect to each Award, to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to the Plan, to
determine the terms and provisions of Award Agreements, and to make all other
determinations under the Plan.

     

    2.           Grant of
Shares.  Subject to the terms and conditions of this Award
Agreement and of the Plan, including without limitation the vesting provisions
set forth in Section 3, the Company hereby grants to Employee
_______________________ (_________) shares of Stock under the Plan, which number
of Shares shall be subject to adjustment pursuant to Section 9.

     

    


     


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    3.           Vesting of
Shares.  At each of the first [____] annual anniversaries of
the Grant Date, subject to continuous employment with the Company, [___]% of the
Shares shall vest and become free of any restriction pursuant to this
Agreement.  Upon the termination of Employee’s employment with the
Company, all of the unvested Shares outstanding immediately prior to such
termination shall be forfeited by Employee, ownership of all such unvested
Shares shall transfer back to the Company, and Employee shall have no further
rights with respect to any of such unvested Shares.

     

    4.           Vesting of Shares upon Committee
Action. Notwithstanding Section 3, the Committee reserves its right,
exercisable at its sole discretion, including under Section 8.2 of the Plan, to
accelerate the vesting of all or any portion of any unvested Shares, including
in connection with a Change of Control.

     

    5.           Restriction
Period.  The Shares granted hereunder may not be sold, pledged,
gifted or otherwise transferred until such Shares become vested in accordance
with Section 3 or 4.  The period of time between the Grant Date and
the date Shares become vested is referred to herein as the “Restriction
Period.”

     

    6.           Legend.  All
certificates representing any Shares which are not vested shall have endorsed
thereon during the Restriction Period the following legend:

     

    THE
TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF THE 2007 EQUITY INCENTIVE
PLAN OF THE ISSUER AND AN AWARD AGREEMENT ENTERED INTO BY THE REGISTERED OWNER
AND THE ISSUER.  COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE IN THE
OFFICES OF THE ISSUER.

     

    7.           Retention of
Certificate.  Any certificate or certificates evidencing any of
the unvested Shares shall be deposited with the Secretary of the
Company.  The Shares may be held in a restricted book entry account in
the name of Employee.  Any such certificates or such book entry shares
are to be held by the Company until such time as such Shares vest, after which
the Company shall release certificate(s) representing such vested Shares to
Employee.

     

    8.           Employee Shareholder
Rights.  During the Restriction Period, Employee shall have all
the rights of a shareholder with respect to unvested Shares except for the right
to transfer the Shares (as set forth in Section 5).  Accordingly,
Employee shall have the right to vote the Shares and receive any dividends
payable with respect to Shares, whether vested or unvested.

     

    9.           Changes in
Capitalization.  In the event that as a result of (a) any
stock dividend, stock split or other change in the outstanding shares of Stock
or (b) any merger or sale of all or substantially all of the assets or
other acquisition of the Company, and by virtue of any such change Employee
shall in his/her capacity as owner of unvested Shares (the “Prior Stock”) be
entitled to new, additional or different shares or securities, such new,
additional or different shares or securities shall thereupon be considered to be
unvested Stock and shall be subject to all of the conditions and restrictions
which were applicable to the Prior Stock pursuant to this Award
Agreement.

     


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


    10.           Taxes.

     

    10.1.          Employee
shall be liable for any and all taxes, including withholding taxes, arising out
of the grant, issuance or vesting of Shares.  Employee may elect to
satisfy such withholding tax obligation by having the Company retain Shares, if
applicable, having a fair market value equal to the Company’s minimum
withholding obligation.

     

    10.2.          Employee
shall be responsible for filing with the Internal Revenue Service an appropriate
written notice of election pursuant to Section 83(b) of the Internal Revenue
Code of 1986, as amended, if Employee wishes to make such an
election.  Employee shall notify the Company in writing if Employee
files such an election (a form of which is attached hereto) within 30 days of
the date of this Award Agreement.  The Company intends, in the event
it does not receive from Employee evidence of such filing, to claim a tax
deduction for any amount which would otherwise be taxable to Employee in the
absence of such an election.  Employee acknowledges that it is
Employee’s sole responsibility and not the Company’s to file timely the election
under Section 83(b), even if Employee requests the Company or its representative
to make this filing on Employee’s behalf.

     

    11.           Fractional
Shares.  The Company shall not be required to deliver any
fractional Shares that may vest pursuant to this Award Agreement.  In
lieu of any delivery of any such fractional Share, the Company shall, at such
time as such fractional Share would otherwise be deliverable, pay to Employee an
amount in cash (rounded to the nearest whole cent) equal to product of (x) the
closing price of a share of Common Stock on the trading day immediately prior to
such date multiplied by (y) the fraction of a Share to which Employee would
otherwise be entitled.

     

    12.           Miscellaneous.

     

    12.1.         Transfers in Violation of
Restrictions.  The Company shall not be required (i) to
transfer on its books any Shares which shall have been sold or transferred in
violation of any of the provisions set forth in this Award Agreement or
(ii) to treat as owner of such shares or to accord the right to vote as
such owner or to pay dividends to any transferee to whom such shares shall have
been so transferred.

     

    12.2.          Further
Assurances.  The parties agree to execute such further
instruments and to take such action as may reasonably be necessary to carry out
the intent of this Award Agreement.

     

    12.3.          Notices.  Any notice
required or permitted hereunder shall be given in writing and shall be deemed
effectively given upon delivery to Employee at such Employee’s address then on
file with the Company.

     

    12.4.          No Employment
Guarantee.  Neither the Plan nor this Award Agreement nor any
provisions under either shall be construed so as to grant Employee any right to
remain in the employ of the Company.

     

    12.5.          Entire
Agreement.  This Award Agreement, including the Plan,
constitute the entire agreement of the parties with respect to the subject
matter hereof.

     


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    13.           Receipt of
Plan.  Employee acknowledges receipt of a copy of the Plan and
represents that he or she is familiar with the terms and provisions thereof, and
hereby accepts this Award Agreement subject to all the terms and provisions
thereof.  Employee has reviewed the Plan and this Award Agreement in
their entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Award Agreement, and fully understands all provisions of the
Award Agreement.  Employee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator upon
any questions arising under the Plan or this Award Agreement.

     

    IN WITNESS WHEREOF, Employee
and the Company have entered into this Award Agreement as of the Grant
Date.

     

     

    


    
      	 
      	 
      	
              Valley
      Commerce Bancorp

               

            
	 
      	 
      	
              By:

            	 
      
	
              [Employee
      Signature]

            	 
      	 
      	 
      
	 
      	 
      	
              Name:

            	 
      
	 
      	 
      	 
      	 
      
	
              [Employee
      Name] (please
      print)

            	 
      	
              Title:

            	 
      


    


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    SECTION
83(b) ELECTION

     

    When an
employee receives stock of his or her employer and if such employee’s rights to
full enjoyment of such stock are conditioned upon the future performance of
substantial services by such employee, including continued performance as an
employee, such employee’s income tax consequences are determined under Section
83 of the Internal Revenue Code.

     

    The
general rule of Section 83 is that the employee has a taxable event at the time
the stock vests.  At that time, the employee has ordinary income equal
to the excess (the “delta”) of the fair
market value of the stock at the time of vesting over the price paid by the
employee for the stock, if any.  If the stock has appreciated between
the time of acquisition and the time of vesting, the appreciation would be
ordinary income to the employee (as would any delta that existed when the stock
was acquired).  The holding period of the stock commences when the
stock vests and any subsequent appreciation would be capital gain.  If
the stock is held for more than one year from the vesting date any capital gain
would be long term capital gain.

     

    This tax
treatment may be viewed as undesirable for two reasons.  First, the
appreciation of the shares between the grant date and the vesting date would be
ordinary income to the employee.  Ordinary income is currently taxed
at federal rates up to 35%, while the maximum federal rate on long-term capital
gain is currently 15%.  Second, the taxable event that occurs on the
vesting date may not coincide with a liquidity event, such as the sale of the
corporation or an initial public offering.  In the absence of a
liquidity event, the employee may have a taxable event but no cash with which to
pay the taxes.

     

    For
unvested stock, Section 83(b) of the Internal Revenue Code offers a solution to
the above-described tax consequences.  An employee who receives
unvested stock may elect to be taxed at the time the stock is
granted.  If the Section 83(b) election is made, the employee would
have ordinary income equal to the delta at the time of grant (rather than at the
time the stock vests).  The holding period would commence at the grant
date and any subsequent appreciation would be capital gain.  If the
one-year holding period is satisfied, all of the gain would be long term capital
gain.  Thus, the Section 83(b) election can result in all of the
employee’s gain being capital gain, however, tax would be due with respect to
the delta at the time the election is made.

     

    The
Section 83(b) election must be filed by the employee and it must be filed with
the Internal Revenue Service Center where the employee files his or her income
tax returns.  The
election must be filed not later than 30 days after the stock is
granted.  There is no relief for failing to timely file the
election.  A copy of the election must be provided to the employer and
a copy must be included with the employee’s tax return for the taxable year in
which the stock is acquired.

     

    NOTE:  The foregoing
is not a complete or thorough discussion of income and other tax consequences of
the employee’s receipt of stock and the Company is not hereby rendering any such
advice.  Employees are strongly urged to consult their own tax
advisors.  Stock acquired from the exercise of stock options may
subject the employee to additional and different income and tax consequences,
none of which are discussed above.


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    ELECTION UNDER
SECTION 83(b)

    OF THE INTERNAL REVENUE CODE
OF 1986

    


    The
undersigned taxpayer hereby elects, pursuant to Sections 55 and 83(b) of the
Internal Revenue Code of 1986, as amended (the “Code”),
to include in taxpayer’s gross income or alternative minimum taxable income (to
the extent applicable under Section 83), as applicable, for the current taxable
year, the amount of any income that may be taxable to taxpayer in connection
with taxpayer’s receipt of the property described below:

     

    
      	
              1.

            	
              The
      name, address, taxpayer identification number and taxable year of the
      undersigned are as follows:

            


    

     

    
      	 
      	
              NAME
      OF TAXPAYER:

            	 
      
	 
      	
              NAME
      OF SPOUSE/DOMESTIC PARTNER:

            	 
      
	 
      	
              ADDRESS:

            	 
      
	 
      	
              TAXPAYER
      IDENTIFICATION NO.:

            	 
      
	 
      	
              SPOUSE/DOMESTIC
      PARTNER IDENTIFICATION NO.:

            	 
      
	 
      	
              TAXABLE
      YEAR:

            	 
      


    

    
      
        	 	 
	
                2.

              	
                The
      property with respect to which the election is made is described as
      follows:

              


      

    

     

    
      	
               
      

            	
              ______________
      shares of Common Stock of Valley Commerce Bancorp (the “Company”)
      received pursuant to a Restricted Share Award Agreement, dated _____________, between
      the Company and the taxpayer.

            


    

     

    
      	
              3.

            	
              The
      date on which the property was transferred
      is:  ____________________ __,
200_

            


    

     

    
      	
              4.

            	
              The
      property is subject to the following
  restrictions:

            


    

     

    
      	
               
      

            	
              The
      shares vest over time, subject to the taxpayer’s continuous employment
      with the Company.  Upon the termination of the taxpayer’s
      employment with the Company, all of the unvested shares outstanding
      immediately prior to such termination shall be forfeited by the taxpayer,
      ownership of all such unvested shares shall transfer back to the Company
      and the taxpayer would have no further rights with respect to any of such
      unvested shares.

            


    

     

    
      	
              5.

            	
              The
      fair market value at the time of transfer, determined without regard to
      any restriction other than a restriction which by its terms will never
      lapse, of such property is: $________ per share for
      an aggregate fair market value of
  $_______________.

            


    

     

    
      	
              6.

            	
              The
      amount (if any) paid for such property:
$0.

            


    

     

    The
undersigned has submitted a copy of this statement to the person for whom the
services were performed in connection with the undersigned’s receipt of the
above-described property.  The transferee of such property is the
person performing the services in connection with the transfer of said
property.

     

    The undersigned understands
that the foregoing election may not be revoked except with the consent of the
Commissioner.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        Dated:
      ____________

                                      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
                                        Print
      Name:

                                      	 
      
	
                                        The
      undersigned spouse/domestic partner of taxpayer joins in this
      election.

                                      
	 
      	 
      	 
      	 
      
	
                                        Dated:
      ____________

                                      	 
      	 
      	 
      
	 
      	 
      	
                                        Spouse/Domestic
      Partner of Taxpayer

                                      
	 
      	 
      	 
      	 
      
	 
      	 
      	
                                        Print
      Name:

                                      	 
      


                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
        6

        
          

        

      

      
         


      

    


    Exhibit
A

     

    Notice
of Exercise of Stock Option

     

    I
________________________________________ (please print legibly) hereby elect to
exercise the stock options(s) identified below (the “Option(s)”) granted to me
by Valley Commerce Bancorp (the “Company”) under its
2007 Equity Incentive Plan (the “Plan”) with respect
to the number of shares of Stock of the Company set forth below (the “Shares”).  I
acknowledge and agree that my exercise of the Option(s) is subject to the terms
and conditions of the Plan and the Stock Option Award Agreement(s) governing the
Option(s).  Optionee confirms and acknowledges that Optionee has
received and reviewed the Plan as approved by Shareholders May 15,
2007.

     

    
      	
               
      

            	
              1.

            	
              _____________
      Shares at $ ________ per share (Grant date of Option):
      ____________

            


    

    
      	
               
      

            	
              2.

            	
              _____________
      Shares at $ ________ per share (Grant date of Option):
      ____________

            


    

    
      	
               
      

            	
              3.

            	
              _____________
      Shares at $ ________ per share (Grant date of Option):
      ____________

            


    

    
      	
               
      

            	
              4.

            	
              _____________
      Shares at $ ________ per share (Grant date of Option):
      ____________

            


    

    


    
      
        	
                OPTION
      EXERCISE

                 

                I
      choose to pay the Exercise Price of the above option(s) as follows [please
      complete the numbered item(s) which apply to your exercise]:

                 

                1.      Cash:
      $____________________

                 

                2.      Check:
      $____________________ (please make checks payable to
      Valley Commerce
      Bancorp)

                 

                3.      Surrender of _________________
      Shares

                 

                4.      Net exercise as
      described in Section 5(a)(iv) of the Option    ̈   [if
      applicable check box]

                 

                I
      choose to pay the tax withholding relating to the exercise of the above
      option(s) as follows:

                 

                5.      Cash:
      $____________________

                 

                6.      Check:
      $____________________ (please make checks payable to Valley Commerce
      Bancorp)

                 

                7.      Surrender of _________________
      Shares currently owned by Optionee

                 

                8.      Withholding of _______________
      Shares from Shares otherwise deliverable on
  exercise

              


      

    

     

    


    7