Document:

EXHIBIT
10.1

 

Tennessee Commerce Bancorp, Inc.

STOCK OPTION PLAN

 

ARTICLE
1

 

1)             General Purpose.  The purpose of the Tennessee Commerce Bancorp
Stock Option Plan (the “Plan”) is to provide certain key employees of Tennessee
Commerce Bancorp, a Tennessee Corporation, (the “Company”) and its subsidiaries
and affiliates, an incentive to

 

•      Join and/or
remain in the service of the Company,

•      Maintain and
enhance the long term performance and profitability of the Company.

•      Acquire a
proprietary interest in the success of the Company.

 

2)             Definition
of Certain Terms

A)           “Agreement” means an
agreement issued pursuant to Section 2.1.

B)            “Board” means the
Board of Directors of the Company.

C)            “Code” means the
Internal Revenue Code of 1986, as amended.

D)            “Company” means
Tennessee Commerce Bancorp, Inc.

E)            “Common
Stock” means the shares of common stock, no par value, of the company and any
other shares into which such common stock shall be exchanged by reason of a
recapitalization, merger, consolidation, split-up, combination, exchange of
shares or the like.

F)            “Optionee” means an
employee of the Company or any of its subsidiaries or affiliates who has been
awarded any Option under this Plan.

G)            “Option” means a “nonqualified”
stock option, as described in Section 1.3.E of the Plan.

H)            The terms “parent
corporation” and “subsidiary corporation” as used herein shall have the meaning
given those terms in Code section 425(e) and (f), respectively.  A corporation shall be deemed a parent or a
subsidiary only for such periods during which the requisite ownership
relationship is maintained.

I)             “Plan” means the
Tennessee Commerce Bancorp Stock Option Plan.

J)             “Termination with
Cause”, with respect to any Optionee, means termination by the Company or any
of its subsidiaries or affiliates of such Optionee’s employment for:

 

1)             Misappropriation
of corporate funds

2)             Conviction
of a felony or a crime involving moral turpiture

3)             Failure
to comply with directions of the Chief Executive Officer or other superiors of
the Optionee or the Board of Directors of the Company or any of its
subsidiaries or affiliates

4)             Gross
negligence and willful misconduct

 

3)             Administration

 

A)           The “Plan” will be
administered by the Board of Directors Tennessee Commerce Bancorp, Inc.

1)             The
Board of Directors of Tennessee Commerce Bancorp, Inc. shall have the authority

(a)           to
exercise all powers granted under the Plan

(b)           to
construe, interpret and implement the Plan and any Agreement executed pursuant
to Section 2.1 in accordance with the terms thereof

(c)           to
prescribe, amend and rescind rules and regulations related to the Plan

(d)           to
correct any defect, supply any omission and reconcile any inconsistency in the
Plan

(e)           to
grant Options on such terms, not inconsistent with the Plan, as it shall
determine.

 

1

 

B)            The determination of
the Board of Directors on all matters relating to the Plan or any Agreement
shall be conclusive.

C)            No member of the Board
of Directors shall be liable for any action or determination made in good faith
with respect to the Plan or any award thereunder.

D)            Persons eligible for
Awards:  Awards under the Plan may be
made from time to time to such key employees of the Company or its subsidiaries
and affiliates as the Board of Directors at its sole discretion select.

E)            Types of Awards Under
the Plan:  Awards may be made under the
Plan in the form of stock options, which shall be “nonqualified” stock options
subject to the provisions of Section 83 of the Internal Revenue Code, all as
more fully set forth in Section 2.

F)            Shares Available for
Awards:  Subject to Section
3.5 (relating to adjustments upon changes in capitalization), the maximum
number of shares of Common Stock with respect to which Options may be awarded
under the Plan shall be equal to 25,000 shares

 

	
  1)

  	
   

  	
  Shares that
  are issued upon the exercise of Options awarded under the Plan shall be
  authorized and unissued shares.

  
	
  2)

  	
   

  	
  Shares of
  Common Stock covered by Options granted under the Plan which expire or
  terminate for any reason shall again become available for award under the
  Plan

  
	
  3)

  	
   

  	
  Without
  limiting the generality of the provisions of this section, the Board may, but
  solely with the Optionee’s consent, agree to cancel any award of Options
  under the Plan and issue new Options in substitution thereof, provided that
  the Options so substituted shall satisfy all of the requirements of the Plan
  as of the date such new Options are awarded.

  

 

ARTICLE
2

 

1)             Agreements
Evidencing Stock Options

 

A)           Options awarded under
the Plan shall be evidenced by Agreements which shall not be inconsistent with
the terms and provisions of the Plan, and which shall contain such provisions
as the Board of Directors may in its sole discretion deem necessary or
desirable.  Without limiting the
generality of the foregoing, the Board may in any Agreement impose such
restrictions or conditions upon the exercise of an Option or upon the sale or
other disposition of the shares of Common Stock issuable upon exercise of an
Option as the Committee may in its sole discretion determine.  By accepting an award pursuant to the Plan
each Optionee shall thereby agree that each such award and shares of Common
Stock acquired upon exercise of an Option shall be subject to all of the terms
and provisions of the Plan, including but not limited to, the provisions of
Section 1.3.C.

B)            Each Agreement shall
set forth the number of shares of Common Stock subject to the Option granted
thereby.

C)            Each Agreement
relating to Options shall set forth the amount payable by the Optionee to the
Company upon exercise of the Option evidenced thereby.  The Option exercise price per share of Common
Stock of a “nonqualified” stock option shall be not less than $10.00 per share,
adjusted as determined by the Board to reflect changes in capitalization as
contemplated by Section 3.4

 

2)             Term of
Options

 

A)           Each Agreement shall
set forth the period during with the Option evidenced thereby shall be
exercisable, whether in whole or in part, such periods to be determined by the
Board of Directors at its discretion

 

3)             Exercise
of Options: Subject to the provisions of Article 2, each Option
granted under the Plan shall be exercised as follows:

 

2

 

A)           An Option shall become
exercisable at such times and subject to such conditions as the applicable
Agreement may provide.

B)            Unless the applicable
Agreement provides otherwise, an Option granted under the Plan may be exercised
from time to time as to all or part of the shares as to which such Option shall
then be exercisable.

C)            Each Agreement will
expressly define the vesting schedule of the Options applicable to that
Agreement.  The Board of Directors may
provide different vesting schedules in different Agreements at its sole option.

D)            An Option shall be
exercisable by the filing of a written notice of exercise with the Company, on
such form and in such manner as the Board of Directors shall in its sole
discretion prescribe.

E)            Any written notice of
exercise of an Option shall be accompanied by payment of the exercise price for
the shares being purchased.  Such payment
shall be made by certified or official bank check payable to the Company (or
the equivalent thereof acceptable to the Board).  As soon as practicable after receipt of such
payment, the Company shall deliver to the Optionee a certificate or
certificates for the shares of Common Stock purchased.

 

4)             Termination
of Options

 

A)           Notwithstanding
anything to the contrary in this Plan, except as the Agreement may otherwise
provide or as set fourth in Section 2.4(b) Section 2.4(c) or Section 2.4(d),
Options granted to an Optionee (and already vested but not yet exercised) shall
terminate on the date which is 45 days after termination of his employment with
the Company for any reason (other than death or disability in which case the Options shall
terminate on the date which is 180 days after the date of such
termination).

B)            Notwithstanding
anything to the contrary in this Plan, all Options granted to an Optionee shall
immediately expire and cease to be exercisable and all rights granted to an
Optionee under this Plan and such Optionee’s Agreement shall immediately expire
in the event of a Termination With Cause of the Optionee by the Company at any
time.

C)            In the event of a
Non-Control Transaction (as hereinafter defined),

 

1)             All
outstanding Options shall remain outstanding and subject to the terms and
conditions of the Plan, including the vesting schedule described in each
Agreement and

2)             Each
Optionee shall be entitled to receive in respect of each share of Common Stock
subject to the Option, upon exercise of such Option after the vesting thereof,
the same amount and kind of stock, securities, cash, property or other
consideration that each holder of a share of Common stock was entitled to
receive in the Non-Control Transaction in respect of a share.

 

D)            In the event of a
Transaction (as hereinafter defined), each outstanding Option shall vest, and,
as of the date of the occurrence of the Transaction (the “Transaction Date”),
the Company shall have the right to cancel any or all Options which have not
been exercised as of the Transaction Date, subject to the payment of the
purchase price as defined below.

 

1)             If
paid in cash, the purchase price payable by the Company to the Optionee upon
the cancellation of each vested and non-vested but unexercised Option will be
the fair market value of the Common Stock underlying each such Option
determined as of the Transaction Date less the aggregate exercise price of each
such Option.

2)             The
fair market value shall be determined in good faith by the Board of Directors based on the value being paid to or
received by the holders of Common Stock in such Transaction for their shares of
Common Stock.

 

E)            “Transaction” means

 

3

 

1)             the
approval by stockholders of the liquidation or dissolution of the Company or
Tennessee Commerce Bank

2)             the
sale or other disposition of 51% or more of the outstanding interests of voting
stock of the Company

3)             the
merger or consolidation of Tennessee Commerce Bank or the Company with or into
any entity.

4)             The
term “Transaction” in each of the definitions above shall exclude each
transaction which is a “Non-Control” transaction.

 

F)            A “Non-Control”
transaction is defined as

 

1)             A
merger or consolidation following which those persons who owned directly or
indirectly a majority of the outstanding interests or shares of voting stock
immediately prior to such merger or consolidation will own directly or
indirectly a majority of the outstanding interest or shares of voting stock of
the surviving corporation.

2)             A
public offering of additional shares of Common Stock of the Company or of
shares in any subsidiary of the Company.

 

ARTICLE
3

 

1)             Amendment
of the Plan:  The Board of
Directors may, without stockholder approval, from time to time suspend or
discontinue the Plan or amend it in any respect whatsoever, except that no such
suspension, revision, or amendment shall adversely alter or impair any rights
or obligations under any award theretofore made under the Plan with the consent
of the person to whom such award was made.

 

2)             With the consent
of the Optionee and subject to the terms and conditions of the Plan, the Board
may amend outstanding Agreements with such Optionee, for example, to accelerate
the time or times at which an Option may be exercised or to extend the
scheduled expiration date of the Option.

 

3)             Nonassignability:  No right granted to any Optionee under
the Plan or under any Agreement shall be assignable or transferable other than
by will or by the laws of descent and distribution.  During the life of the Optionee, all rights
granted to the Optionee under the Plan or under any Agreement shall be
exercisable only by him.

 

4)             Withholding
of Taxes:  The Company
shall be entitled to withhold an amount sufficient to satisfy any federal,
state or other governmental tax requirements related to an Option.  Whenever, under the Plan, shares of Common
Stock are to be delivered upon exercise of an Option, the Company shall be
entitled to require as a condition of deliver that the Optionee remit an amount
sufficient to satisfy all federal state and other governmental tax withholding
requirements related thereto.

 

5)             Adjustments
Upon Changes in Capitalization: 
If and to the extent specified by the Board, the exercise price for
Options and the number of shares of Common Stock which may be issued pursuant
to the exercise of Options granted under the Plan may be appropriately adjusted
for any increase or decrease in the number of issued shares of Common Stock resulting
from the subdivision or combination of shares of Common Stock or other capital
adjustments, or the payment of a stock dividend after the effective date of
this Plan, or other increase or decrease in the number of shares of Common
Stock; provided, however, that any Options to purchase fractional shares shall
be eliminated.

 

6)             Right of
Discharge Reserved: 
Nothing in this Plan or in any Agreement shall confer upon any employee
or other person the right to continue in the employment or service of
the Company or any of its subsidiaries or affiliates or affect any right with
the Company or any of its subsidiaries or affiliates may have to terminate the
employment or service of such employee or other person.

 

4

 

7)             No Rights
as a Stockholder:  No
Optionee or other person holding an Option shall have any of the rights of a
stockholder of the Company with respect to shares subject to an Option until
the issuance of a stock certificate to him for each share.  Except as otherwise provided in Section ---,
no adjustment shall be made for dividends, distributions or other rights for
which the record date is prior to the date such stock certificate is issue.

 

8)             Nature of
Payments:

 

A)           Any and all payments of
shares of Common Stock or cash hereunder shall be granted, transferred or paid
in consideration of services performed by the Optionee for the Company or any
of its subsidiaries or affiliates.

 

B)            All such grants,
issuances and payments shall constitute a special incentive payment to the
Optionee and shall not, unless otherwise determined by the Board, be taken into
account in computing the amount of salary or compensation of the Optionee for
the purposes of determining any pension, retirement, death or other benefits.

 

9)             Non-Uniform
Determinations: 
Determinations by the Board of Director under the Plan need not be
uniform and may be made selectively among persons who receive, or are eligible
to receive, awards under the Plan.

 

10)           Nothing contained in
the Plan shall be deemed in any way to limit or restrict the Company or any of
its subsidiaries or affiliates from making any award or payment to any person
under any other plan, arrangement or understanding, whether now existing

 

11)           Effective Date and Term of
Plan:

 

A)           This Plan shall be
deemed adopted and become effective upon the approval thereof of the Board of
Directors.

 

B)            The Plan shall
terminate 10 years after the date on which it becomes effective, and no awards
shall thereafter be made under the Plan. 
Notwithstanding the foregoing, all awards made under the Plan prior to
the date on which the Plan terminates shall remain in effect until such awards
have been satisfied or terminated in accordance with the terms and provisions
of the Plan.

 

5

 

Tennessee Commerce Bancorp, Inc.

STOCK OPTION PLAN

 

(a) 
NONQUALIFIED STOCK OPTION AGREEMENT

 

Nonqualified Stock
Option Agreement dated as of          
between Tennessee Commerce Bancorp Inc., a Tennessee company (the “Company”)
and

 

                                                                                                        (the “Optionee”).

 

The Board of
Directors of Tennessee Commerce Bancorp has determined that the Optionee is one
of the key employees of the Company, and that the objectives of the Company’s
Stock Option Plan (the “Plan”) will be furthered by awarding to the Optionee
Options under the Plan.  Capitalized
terms defined in the Plan and not otherwise defined herein shall have the
meaning given such terms in the Plan.

 

In
consideration of the foregoing and of the mutual undertakings set forth in this
Nonqualified Stock Option Agreement, the Company and the Optionee agree as
follows:

 

Section 1                Grant of Option

 

1.             The
Company hereby grants to the Optionee an option (the “Option” to purchase         shares
of Common Stock (“Common Stock”) of the Company, at a purchase price of $          per
share.

2.             The
Option granted hereby is intended to be a “nonqualified” stock option subject
to the provisions of section 83 of the Code and is not intended to qualify as
an “incentive stock option” subject to the provisions of Section 422 of the
Code.

 

Section 2                Exerciseability

 

1.             The
Option shall be exercisable for the cumulative number of shares and at the
times provided in the following schedule:

 

	
  Applicable Date

  	
   

  	
  Cumulative Shares

  
	
  December 31, 2000

  	
   

  	
   

  
	
  December 31, 2001

  	
   

  	
   

  

 

2.             Subject
to Section 4 and other terms of the Plan, the Option will terminate as to any
and all shares of Common Stock for which the Option has not yet been exercised
on December 31, 2010.

 

Signed, this                             
day of                  

 

	
   

  	
   

  	
   

  	
   

  
	
  Tennessee Commerce Bancorp, Inc.

  	
  OptioneeEXHIBIT 10.2

 

TENNESSEE COMMERCE BANK

Director’s Common Stock Option

Number      

 

1.                                       General Provisions.  Tennessee Commerce Bank, a Tennessee
corporation (herein called the “Company”), for value received, and other good
and valuable consideration, receipt of which is hereby acknowledged, hereby
certifies that                                 ,
or his/her/its registered assigns (herein called the “Option Holder”) is
entitled to purchase shares of the fully paid and nonassessable Common Stock,
$1.00 par value per share, of the Company (such number and character of such
shares being subject to adjustment as provided in paragraph 4 below), at
Exercise Price set forth herein by surrendering this Option executed by the
Option Holder and by paying in full the Exercise Price for the number of shares
of Common Stock as to which this Option is exercised.  No fractional shares shall be issued
hereunder, and instead, any fractional shares created by exercise hereunder
shall be purchased by the Company at the rate of the Exercise Price then in
effect.

 

2.                                       Expiration Date.  This Option shall expire and all rights
hereunder shall cease on the tenth anniversary of the date of this Option.

 

3.                                       Number of Shares Covered by
Option; Exercise Price.  The number of shares of the Company’s  Common Stock for which this Option may be
exercised shall be 11,250 shares, subject to adjustment as provided in
paragraph 4 below, which may be purchased as a whole or in part any time upon
vesting.  The price per share for the
shares purchased upon exercise of this Option shall be $10.00 per share,
subject to adjustment as provided in paragraph 4 below (the “Exercise Price”).  The number of shares for which this Option
may be exercised shall be vested 1,250 shares upon issuance of this Option and
then in 2,000 share increments on each of the first five anniversary dates of
the Option.  In the event of death or
disability, all options shall vest immediately. 
No further shares shall be vested after any other termination of service
with the Company.  Upon termination of
service other than by death or disability, this Option must be exercised within
90 days.

 

4.                                       Adjustments in Number of Shares
and Exercise Price.  All provisions of this Section 4 are limited
to the vested portion of any such Options affected at the time such Options are
exercised.   If at any time during the
period when this Option may be exercised, the Company shall declare or pay a
dividend or dividends payable in shares of its 
Common Stock (or any security convertible into or granting rights to
purchase shares or such  Common Stock) or
split the then outstanding shares of its 
Common Stock into a greater number of shares, the number of shares of  Common Stock which may be purchased upon the
exercise of this Option in effect at the time of taking of a record for such
dividend or at the time of such stock split shall be proportionately increased
and the Exercise Price proportionately decreased as of such time; and
conversely, if at any time the Company shall contract the number of outstanding
shares of its  Common Stock by combining
such shares into a smaller number of shares, the number of shares which may be
purchased upon the exercise of this Option at the time of such action shall be
proportionately decreased and the Exercise Price proportionately increased as
of such time.

 

5.                                       Reservation of Shares.  The Company shall at all times reserve and
keep available a number of its authorized but unissued shares of its  Common Stock sufficient to permit the
exercise in full of this Option.

 

6.                                       Sale of Option or Shares.  Neither this Option nor the shares to be
issued hereunder have been registered under the Securities Act, or under the
securities laws of any state.  Neither
this Option nor such shares to be issued hereunder, when issued, may be sold,
transferred, pledged or hypothecated in the absence of an effective
registration statement for this Option, or the shares to be issued hereunder,
as the case may be, under the Securities Act, and such registration or
qualification as may be necessary under the securities laws of any state, or an
opinion of counsel satisfactory to the Company that such registration or
qualification is not required.  In
addition, all Options shall not be transferable except upon death or disability
of the Option Holder upon which the Options may be transferred to the Option
Holder’s estate, custodian, or other beneficiary.

 

 

This Option
shall be registered on the books of the Company, which shall be kept by it at
its principal office for the purpose and shall be transferable only on said
books by the registered owner hereof in person or by duly authorized attorney
upon surrender of this Option properly endorsed, and only in compliance with
the provisions of the preceding paragraph. 
In case of the exercise hereof in part only, the Company will deliver to
the Option Holder a new Option of like tenor in the name of the Option Holder
evidencing the right to purchase the number of shares as to which this Option
has not been exercised.

 

7.                                       Capital Call.  The Company’s primary federal regulator may
direct the Company to require the Option Holder to exercise or forfeit his
rights under this Option if the Company’s capital falls below the minimum
requirements, as determined by the Company’s state or primary federal
regulator.

 

8.                                       Governing Law.  This Option is to be construed and enforced
in accordance with and governed by the laws of the State of Tennessee.

 

IN WITNESS
WHEREOF, the Company
has caused this Option to be
issued in its corporate name by its duly appointed officer.

 

DATED:                           

	
   

  	
  TENNESSEE COMMERCE BANK

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

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