Exhibit
10.7


 


THE
BANK HOLDINGS

NONQUALIFIED STOCK OPTION AGREEMENT


 


This
Nonqualified Stock Option Agreement (the “Agreement”) is made and entered into
as of the 6th day of July, 2004, by and between The Bank
Holdings, a Nevada corporation (the “Company”), and Bob Walter (“Optionee”);


 


WHEREAS,
pursuant to The Bank Holdings 2002 Stock Option Plan (the “Plan”), a copy of
which is attached hereto, the Board of Directors of the Company has authorized
granting to Optionee, a nonqualified stock option to purchase all or any part
of Seventeen Thousand and Five Hundred
(17,500) authorized but unissued shares of the Company’s common
stock for cash at the price of Fifteen
Dollars and Seventy-Seven Cents ($15.77) 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 Company 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 Seventeen
Thousand and Five Hundred (17,500) shares of the Company’s common
stock (hereinafter called “Common Stock”) at the price of Fifteen Dollars and Seventy-Seven Cents ($15.77) 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.


 


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


 


	
  3,500 Shares

  	
   

  	
  Upon Grant, July 6, 2004

  
	
  3,500 Shares

  	
   

  	
  After July 6, 2005

  
	
  3,500 Shares

  	
   

  	
  After July 6, 2006

  
	
  3,500 Shares

  	
   

  	
  After July 6, 2007

  
	
  3,500 Shares

  	
   

  	
  After July 6, 2008

  



 


This
option shall remain exercisable as to all of such shares until July 6, 2014 (but not later than ten
(10) years from the date this option is granted) unless this option has expired
or terminated


 


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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 Company stating the
number of shares with respect to which this option is being exercised, together
with cash or qualifying shares of the Company’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 Company 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 Company
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 Company
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 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 Company or a subsidiary corporation.


 


5.                                      Termination of Employment
for Cause.  If Optionee is an employee of the Company or
a subsidiary corporation and Optionee’s employment with the Company 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


 


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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
Company 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 Company 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 Company 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 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 Company or a subsidiary corporation to employ
Optionee for any period, nor shall it interfere in any way with the right of
the Company 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


 


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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 Company 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 Company has fully complied with all
applicable requirements of any regulatory agency having jurisdiction over the
Company, and all applicable requirements of any exchange upon which the Common
Stock of the Company may be listed.


 


11.                               Notices.  Any
notice to the Company provided for in this Agreement shall be addressed to it
in care of its Chairman at its main office and any notice to Optionee shall be
addressed to Optionee’s address on file with the Company 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 Company by personal delivery to its Chairman.


 


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


 


 


	
  OPTIONEE

  	
   

  	
  THE BANK HOLDINGS

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
  /s/ Bob Walter

  	
   

  	
  By

  	
  /s/ Hal Giomi

  	
   

  
	
   

  	
  Bob Walter

  	
   

  	
  Hal Giomi, Chairman & CEO

  	
   

  



 


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