Document:

ex4-2.htm

    

     

    Exhibit
4.2

     

    VALLEY
COMMERCE BANCORP

     

    2007
EQUITY INCENTIVE PLAN

     

    Stock
Option 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
person (the “Optionee”)
have entered into this Stock Option Award Agreement (the “Award Agreement”)
effective as of the Grant Date set forth below.  The Company has
granted to Optionee the option (the “Option”) to purchase the
number of shares (the “Shares”) of common stock, no
par value, of the Company (the “Stock”) set forth below at
the per Share purchase price (the “Exercise Price”) set forth
below, pursuant to the terms of this Award Agreement.  The Option was
granted 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 Option is subject in all
respects.

     

    
      
        	
                Optionee
      Name:

              	
                _____________________

              
	
                Grant
      Date:

              	
                _____________________

                MM/DD/YYYY

              
	
                Expiration
      Date:

              	
                _____________________

                MM/DD/YYYY

              
	
                Type
      of Option:

                Number
      of Shares:

              	
                _____________

                _____________

              
	
                Exercise
      Price:

              	
                $______

              
	 
      	 
      

      

    

    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. Optionee confirms and
acknowledges that Optionee 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.           Nature of the
Option.  The Option has been granted as an incentive to
Optionee’s Continuous Service, and is in all respects subject to such Continuous
Service and all other terms and conditions of this Award
Agreement.  The Option is intended to be an [Incentive/Nonstatutory]
Option.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.           Vesting, Exercise and Term of
Option.  The Option shall vest and become exercisable during
its term in accordance with the following provisions:

     

    
      	
               
      

            	
              (a)

            	
              Vesting
      and Right of Exercise.

            

    

     

    (i)           The
Option shall vest and become exercisable with respect to 25% of the Shares at
each of the first 4 annual anniversaries of the Grant Date until all of the
Shares have vested, subject to Optionee’s Continuous Service.

     

    (ii)           In
the event of Optionee’s death, disability or other termination of Optionee’s
Continuous Service, the Option shall be exercisable in the following
manner:

     

    (I)  Termination of
Employment:  the Option ceases to be exercisable 90 days
following termination of employment, during which time it shall be exercisable
only to the extent exercisable at the date of termination, except that the
Option shall not be exercised after its expiration date;

     

    (II)  Disability:  if
Optionee was in Continuous Service from the Grant Date until the date of
termination of service due to disability, the Option ceases to be exercisable
twelve months following the date of termination of Continuous Service from
disability, during which time it shall be exercisable only to the extent
exercisable at the date of termination due to disability, except that the Option
shall not be exercised after its expiration date; and

     

    (III) Death:  if the
Optionee was in Continuous Service from the Grant Date until the date of death,
the Option ceases to be exercisable twelve months following the date of death,
during which time it shall be exercisable by the Optionee’s estate or by a
person who acquired the right to exercise the Option by bequest, inheritance or
otherwise as a result of the Optionee’s death only to the extent exercisable at
the date of death, except that the Option shall not be exercised after its
expiration date. 

     

    (b)           Method of
Exercise.  In order to exercise any vested portion of the
Option, Optionee shall notify the Company in writing by executing and delivering
the Notice of Exercise of Stock Option in the form attached hereto as Exhibit A
(the “Exercise
Notice”).  The certificate or certificates representing Shares
as to which the Option has been exercised shall be registered in the name of
Optionee or otherwise as the Optionee may request and the Company shall
permit.

     

    (c)           Restrictions on Exercise; Term of
Option.

     

    (i)           Optionee
may exercise the Option only with respect to Shares that have vested in
accordance with Section 3(a) of this Award Agreement.

     

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (ii)           Optionee
may not exercise the Option if the issuance of the Shares upon such exercise or
the method of payment of consideration for such Shares would constitute a
violation of any applicable federal or state securities law or other law or
regulation.

    

    (iii)           The
method and manner of payment of the Exercise Price will be subject to the
prohibition on loans to directors and executive officers in Section 402 of the
Sarbanes-Oxley Act of 2002, to the rules under Part 221 of Title 12 of the Code
of Federal Regulations as promulgated by the Federal Reserve Board, and to any
other applicable laws, rules or regulations.

     

    (iv)           As
a condition to the exercise of the Option, the Company may require certain
representations and warranties as the Company may request pursuant to Section
9.3 of the Plan. Prior to or subsequent to exercise of the Option, the Company
may require the Optionee to enter into certain lock-up arrangements as provided
in Section 9.4 of the Plan.

     

    (v)           Optionee
may only exercise the Option upon, and the obligations of the Company under this
Award Agreement to issue Shares to Optionee upon any exercise of the Option is
conditioned on, satisfaction of all federal, state, local or other withholding
tax obligations associated with such exercise (whether so required to secure for
the Company a tax deduction or otherwise) (“Withholding
Obligations”).  The Company reserves the right to require Optionee to
remit to the Company an amount sufficient to satisfy all Withholding Obligations
prior to the issuance of any Shares upon any exercise of the
Option.  In addition, Optionee authorizes the Company to deduct any
such Withholding Obligations from any payments of any kind due to Optionee
(whether in connection with the Option or otherwise). The Optionee may elect to
satisfy Withholding Obligations, in whole or in part, by having the Company
withhold shares of Stock otherwise due to the Optionee upon exercise of the
Option, or by submitting shares of Stock previously owned by the Optionee.

     

    (vi)           No
fraction of a Share shall be purchasable or deliverable upon exercise of the
Option, but in the event any such Shares shall include a fraction of a Share
(whether due to net exercise, payment of the Exercise Price by having Shares
withheld or by submitting previously owned shares, by adjustment of the Option
as provided in the Plan, or otherwise), such number of Shares shall be rounded
down to the nearest smaller whole number of Shares.

     

    (vii)           The
Option may not be exercised more than 10 years after the Grant Date, and may be
exercised during such term only in accordance with the terms of this Award
Agreement.

     

    

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    4.           Transferability
of Option.

    

    (a)           The
Option may not be transferred in any manner other than by will or pursuant to
the laws which would apply if the Optionee dies without leaving a
will.

     

    (b)           The
terms of this Award Agreement shall bind the Optionee and his or her spouse or
domestic partner and the respective Permitted Transferees, executors,
administrators, heirs, personal representatives and successors of the
foregoing.

     

    5.           Method of
Payment.

     

    (a)           Upon
exercise, Optionee shall pay the aggregate Exercise Price of the Shares
purchased and the Withholding Obligations by any of the following methods, or a
combination thereof, at the election of Optionee:

     

    (i)           cash;

     

    (ii)           certified
or bank cashier’s check;

     

    (iii)           if
shares of Stock are traded on an established stock market or exchange on the
date of exercise, by surrender of whole shares of Stock having a Market Value
equal to the portion of the Exercise Price to be paid by such surrender, provided that if such
shares of Stock to be surrendered were acquired upon exercise of an Incentive
Option, Optionee must have first satisfied the holding period requirements under
Section 422(a)(1) of the Code;

     

    (iv)           by
a “net exercise” of the Option, in which the Company will not require a payment
of the Exercise Price but will reduce the number of shares of Stock issued upon
the exercise by the largest number of whole shares that have a Fair Market Value
that does not exceed the aggregate Exercise Price of the Shares as to which the
Option is being exercised. With respect to any remaining balance of the
aggregate Exercise Price, the Company will accept a cash payment from the
Optionee. The number of shares of Stock underlying the Option will decrease
following exercise to the extent of (i) Shares used to pay the Exercise
Price of an Option under the “net exercise” feature, (ii) Shares actually
delivered to the Optionee as a result of such exercise and (iii) Shares
withheld to pay the Withholding Obligations; or

     

    (v)           if
shares of Stock are traded on an established stock market or exchange on the
date of exercise, pursuant to and under the terms and conditions of any formal
cashless exercise program authorized by the Company entailing the sale of the
Stock subject to an Option in a brokered transaction (other than to the
Company).

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (b)           Payment in
Stock.  If Optionee shall pay all or a portion of the aggregate
Exercise Price and Withholding Obligations due upon an exercise of the Option by
surrendering shares of Stock pursuant to Section 5(a)(iii), then
Optionee:

     

    (i)           shall
accompany the Exercise Notice with a duly endorsed blank stock power (with an
appropriate signature guarantee if requested by the Company) with respect to the
number of shares of Stock to be surrendered and shall deliver the certificate(s)
representing such surrendered shares to the Company at its principal offices
within two business days after the date of the Exercise Notice;

     

    (ii)           authorizes
the Company to transfer so many whole number of Shares represented by such
certificate(s) that have a Fair Market Value that does not exceed the aggregate
Exercise Price for the Shares as to which the Option is being exercised. With
respect to any remaining balance of the aggregate Exercise Price, the Company
will accept a cash payment from the Optionee; and

     

    (iii)           may
not surrender any fractional share as payment of any portion of the Exercise
Price.

     

    6.           Adjustments to
Option.  Pursuant to Section 8.1 of the Plan, in certain cases
the number of Shares covered by the Option and the Exercise Price will be
proportionately adjusted if the outstanding number of shares of Stock are
increased, decreased, or exchanged for a different number or kind of shares or
other securities, or if additional shares or new or different shares or other
securities are distributed with respect to the outstanding Stock, through
merger, consolidation, sale of all or substantially all the property of the
Company, reorganization, combination, recapitalization, reclassification, stock
dividend, stock split, reverse stock split, or other similar distribution of the
Company’s equity securities without the receipt of consideration by the
Company.

     

    7.           Not an Employment
Contract.  Nothing in the Plan or this Award Agreement shall
confer upon Optionee any right to continuation of the Optionee’s employment or
other association with the Company or shall interfere with or restrict in any
way the rights of the Company, which are hereby expressly reserved, to modify
the terms of Optionee’s employment or to terminate Optionee’s employment at any
time for any reason whatsoever, with or without cause.

     

    8.           Tax Consequences
Generally.  Optionee acknowledges that Optionee may suffer
adverse tax consequences as a result of exercise of the
Option.  Optionee acknowledges that the Company advises Optionee to
consult with the Optionee’s tax advisers in connection with the tax implications
relating to the Option including but not limited to the acquisition, disposition
or transfer of the Option or of any securities or property in connection
therewith, and that Optionee is not relying on the Company for any tax advice in
connection therewith.  Any adverse consequences incurred by an
Optionee in connection with the Option, including, without limitation, from the
use of shares of Stock to pay any part of the Exercise Price or any tax in
connection with the exercise of the Option, and any adverse tax consequences
arising from a disqualifying disposition within the meaning of Section 422
of the Code, shall be the sole responsibility of Optionee.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    9.           Cancellation of Option For Improper
Acts of Optionee. If, at any time during the course of the Optionee’s
employment with the Company or any Affiliates or within six months after
termination of Continuous Service, the Optionee engages in any activity in
competition with any business activity of the Company or of any Affiliates, or
inimical, contrary or harmful to the interests of the Company or any Affiliates,
then (1) the Option and all other Awards under the Plan made to the Optionee
shall terminate and be forfeited, (2) any cash, security or other property
acquired by the Optionee pursuant to the Option and pursuant to all other Awards
under the Plan, which cash, security or property was acquired by the Optionee
during the Forfeiture Period shall be forfeited, and (3) any gain realized by
the Optionee from the sale of any security acquired under the Option or any
other Award during the Forfeiture Period shall be paid by the Optionee to the
Company.  The “Forfeiture Period” shall mean the period commencing on
the Grant Date of the Option or any other Award and ending six months from
termination of Continuous Service.

     

    10.           Consent of Spouse/Domestic
Partner.  Optionee agrees that Optionee’s spouse’s or domestic
partner’s interest in the Option is subject to this Award Agreement and such
spouse or domestic partner is irrevocably bound by the terms and conditions of
this Award Agreement.  Optionee agrees that all community property
interests of Optionee and Optionee’s spouse or domestic partner in the Option,
if any, shall similarly be bound by this Award Agreement.  Optionee
agrees that this Award Agreement is binding upon Optionee’s and Optionee’s
spouse’s or domestic partner’s executors, administrators, heirs and
assigns.  Optionee represents and warrants to the Company that
Optionee has the authority to bind Optionee’s spouse/domestic partner with
respect to the Option.  Optionee agrees to execute and deliver such
documents as may be necessary to carry out the intent of this Section 10 and the
consent of Optionee’s spouse/domestic partner.

     

    11.           Receipt of
Plan.  Optionee 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 the grant of Options made pursuant to this Award Agreement
subject to all of the terms and provisions thereof.  Optionee 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.  Optionee 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, Optionee and the Company have entered into this Award Agreement
as of the Grant Date.

     

    
      	 
      	 
      	
              Valley
      Commerce Bancorp

               

            
	 
      	 
      	
              By:

            	 
      
	
              [Optionee
      Signature]

            	 
      	 
      	 
      
	 
      	 
      	
              Name:

            	 
      
	 
      	 
      	 
      	 
      
	
               [Optionee
      Name] (please
      print)

            	 
      	
              Title:

            	 
      

    

    
6ex4-3.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

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00156-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00156-of-00352.parquet"}]]