Document:

NONQUALIFIED
      STOCK OPTION AGREEMENT

    

    CAPE
      COASTAL TRADING CORPORATION

    2005
      EQUITY INCENTIVE PLAN

    

    

    THIS
      AGREEMENT, made effective as of this ____ day of _____________, 20__ (the “Issue
      Date”), by and between Cape Coastal Trading Corporation, a Delaware corporation
      (the “Company”), and ______________________ (“Participant”).

    

    W
      I T N E
      S S E T H:

    

    WHEREAS,
      Participant on the date hereof is an employee, director or consultant of the
      Company or one of its Affiliates; and

    

    WHEREAS,
      the Company wishes to grant an incentive stock option to Participant to purchase
      shares of the Company’s Common Stock pursuant to the Company’s 2005 Equity
      Incentive Plan (the “Plan”); and

    

    WHEREAS,
      the Administrator of the Plan has authorized the grant of an incentive stock
      option to Participant and has determined that, as of the effective date of
      this
      Agreement, the fair market value of the Company’s Common Stock is $______
      per share;

    

    NOW,
      THEREFORE, in consideration of the premises and of the mutual covenants herein
      contained, the parties hereto agree as follows:

    

    1.     Grant
      of Option.
      The
      Company hereby grants to Participant on the date set forth above (the “Date of
      Grant”), the right and option (the “Option”) to purchase all or portions of an
      aggregate of ________________________ (__________) shares of Common Stock at
      a
      per share price of $______ the terms and conditions set forth herein, and
      subject to adjustment pursuant to Section 12 of the Plan. This Option is
not
      intended
      to be an incentive stock option within the meaning of Section 422, or any
      successor provision, of the Internal Revenue Code of 1986, as amended (the
      “Code”), and the regulations thereunder. 

    

    2.     Duration
      and Exercisability.

    

    a.     General.
      The
      term during which this Option may be exercised shall terminate on
      ______________________, 20__ (the “Expiration Date”), except
      as
      otherwise provided in Paragraphs 2(b) through 2(e) below. This Option shall
      become exercisable according to the following schedule:

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
              Vesting
                Date

            	 	
              Percentage/Number
                of Shares

            
	 	 	 
	 	 	 
	 	 	 

    

    

    Once
      the
      Option becomes exercisable to the extent of any of the aggregate number of
      shares specified in Paragraph 1, Participant may continue to exercise this
      Option with respect to such shares under the terms and conditions of this
      Agreement until the termination of the Option as provided herein. If Participant
      does not purchase upon an exercise of this Option the full number of shares
      which Participant is then entitled to purchase, Participant may purchase upon
      any subsequent exercise prior to this Option’s termination such previously
      unpurchased shares in addition to those Participant is otherwise entitled to
      purchase.

     

    b.     Termination
      of Relationship (other than Termination for Cause, Disability or
      Death).
      If
      Participant ceases to be [an
      employee] [a consultant] [a director]
      of the
      Company or any Affiliate for any reason other than disability or death, this
      Option shall completely terminate on the earlier of (i) the close of business
      on
      the three-month anniversary of the date of termination of Participant’s
      relationship, and (ii) the Expiration Date of this Option stated in
      Paragraph 2(a) above. In such period following such termination of Participant’s
      relationship, this Option shall be exercisable only to the extent the Option
      was
      exercisable on the vesting date immediately preceding the date on which
      Participant’s relationship with the Company or Subsidiary has terminated, but
      had not previously been exercised. To the extent this Option was not exercisable
      upon the termination of such relationship, or if Participant does not exercise
      the Option within the time specified in this Paragraph 2(b), all rights of
      Participant under this Option shall be forfeited.

    

    c.     Termination
      of Relationship for Cause.
      If
      Participant’s relationship with the Company or any Affiliate is terminated for
“cause,” the unexercised portion of this Option shall immediately expire, and
      all rights of Participant under this Option shall be forfeited. Solely for
      purposes of this Paragraph 2(c), “cause” shall mean (i) Participant being
      charged with a felony or convicted of any
      criminal misdemeanor or more serious act; (ii) any intentional and/or willful
      act of fraud or dishonesty by Participant related to or connected with
      Participant’s employment by the Company or any of its Affiliates; (iii) the
      willful and/or continued failure, neglect or refusal by Participant to perform
      his or her employment duties with the Company or any of its Affiliates, (iv)
      a
      material violation of the Company’s or an Affiliate’s policies or codes of
      conduct; or (v) the willful and/or material breach by Participant of any
      agreement between Participant and the Company or any of its Affiliates,
      including but not limited to an employment agreement or a noncompetition
      agreement.

    

    d.    Disability.
      If
      Participant ceases to be [an
      employee] [a consultant] [a director]
      of the
      Company or any Affiliate because of disability (as defined in Code Section
      22(e), or any successor provision), this Option shall completely terminate
      on
      the earlier of (i) the close of business on the twelve-month anniversary of
      the
      date of termination of Participant’s relationship, and (ii) the Expiration
      Date of this Option stated in Paragraph 2(a) above. In such period following
      such termination of Participant’s relationship, this Option shall be exercisable
      only to the extent the Option was exercisable on the vesting date immediately
      preceding the date on which Participant’s relationship with the Company or
      Subsidiary has terminated, but had not previously been exercised. To the extent
      this Option was not exercisable upon the termination of such relationship,
      or if
      Participant does not exercise the Option within the time specified in this
      Paragraph 2(c), all rights of Participant under this Option shall be
      forfeited.

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    e.     Death.
      In
      the
      event of Participant’s death, this Option shall terminate on the earlier of (i)
      the close of business on the twelve-month anniversary of the date of
      Participant’s death, and (ii) the Expiration Date of this Option stated in
      Paragraph 2(a) above. In such period following Participant’s death, this Option
      may be exercised by the person or persons to whom Participant’s rights under
      this Option shall have passed by Participant’s will or by the laws of descent
      and distribution only to the extent the Option was exercisable on the vesting
      date immediately preceding the date of Participant’s death, but had not
      previously been exercised. To the extent this Option was not exercisable upon
      the date of Participant’s death, or if such person or persons fail to exercise
      this Option within the time specified in this Paragraph 2(d), all rights under
      this Option shall be forfeited.

    

    3.      Manner
      of Exercise.

    

    a.     General.
      The
      Option may be exercised only by Participant (or other proper party in the event
      of death or incapacity), subject to the conditions of the Plan and subject
      to
      such other administrative rules as the Administrator may deem advisable, by
      delivering within the Option Period written notice of exercise to the Company
      at
      its principal office. The notice shall state the number of shares as to which
      the Option is being exercised and shall be accompanied by payment in full of
      the
      Option price for all shares designated in the notice. The exercise of the Option
      shall be deemed effective upon receipt of such notice by the Company and upon
      payment that complies with the terms of the Plan and this Agreement. The Option
      may be exercised with respect to any number or all of the shares as to which
      it
      can then be exercised and, if partially exercised, may be so exercised as to
      the
      unexercised shares any number of times during the Option period as provided
      herein.

    

    b.     Form
      of Payment.
      Subject
      to approval by the Administrator, payment of the option price by Participant
      shall be in the form of cash, personal check, certified check or mature,
      previously-acquired shares of Common Stock of the Company, broker-assisted
      exercise, or any combination thereof; provided, however, that Participant shall
      not be permitted to pay the option price in the form of a broker-assisted
      exercise or in the form of mature, previously-acquired shares of Common Stock
      until after the effective date of an initial public offering of the Company’s
      Common Stock; and provided, further, that Participant shall not be permitted
      to
      pay the option price in the form of a broker-assisted exercise or in the form
      of
      mature, previously-acquired shares of Common Stock if payment in such form
      will
      cause the Company to recognize a compensation expense under generally accepted
      accounting principles. Any stock tendered as part of such payment shall be
      valued at its Fair Market Value as provided in the Plan. For purposes of this
      Agreement, “mature, previously-acquired shares of Common Stock” and
“broker-assisted exercise” shall have the meaning set forth in Section 8 of the
      Plan. The Administrator may, in its discretion, permit Participant to tender
      such mature, previously-acquired shares through the actual delivery of such
      shares or through attestation of ownership on such forms as the Administrator
      may prescribe.

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    c.     Stock
      Transfer Records.
      As soon
      as practicable after the effective exercise of all or any part of the Option,
      Participant shall be recorded on the stock transfer books of the Company as
      the
      owner of the shares purchased, and the Company shall deliver to Participant
      one
      or more duly issued stock certificates evidencing such ownership. All requisite
      original issue or transfer documentary stamp taxes shall be paid by the Company.
      

    

    4.     Miscellaneous.

    

    a.     Rights
      as Shareholder.
      This
      Agreement shall not confer on Participant any right with respect to continuance
      of any relationship with the Company or any of its Affiliates, nor will it
      interfere in any way with the right of the Company to terminate such
      relationship. Participant shall have no rights as a shareholder with respect
      to
      shares subject to this Option until such shares have been issued to Participant
      upon exercise of this Option. No adjustment shall be made for dividends
      (ordinary or extraordinary, whether in cash, securities or other property),
      distributions or other rights for which the record date is prior to the date
      such shares are issued, except as provided in Section 12 of the
      Plan.

    

    b.     Securities
      Law Compliance.
      The
      exercise of all or any parts of this Option shall only be effective at such
      time
      as counsel to the Company shall have determined that the issuance and delivery
      of Common Stock pursuant to such exercise will not violate any state or federal
      securities or other laws. Participant may be required by the Company, as a
      condition of the effectiveness of any exercise of this Option, to agree in
      writing that all Common Stock to be acquired pursuant to such exercise shall
      be
      held, until such time that such Common Stock is registered and freely tradable
      under applicable state and federal securities laws, for Participant’s own
      account without a view to any further distribution thereof, that the
      certificates for such shares shall bear an appropriate legend to that effect
      and
      that such shares will be not transferred or disposed of except in compliance
      with applicable state and federal securities laws. 

    

    c.     Mergers,
      Recapitalizations, Stock Splits, Etc.
      Pursuant
      and subject to Section 12 of the Plan, certain changes in the number or
      character of the Common Stock of the Company (through merger, consolidation,
      exchange, reorganization, divestiture (including a spin-off), liquidation,
      recapitalization, stock split, stock dividend or otherwise) shall result in
      an
      adjustment, reduction or enlargement, as appropriate, in Participant’s rights
      with respect to any unexercised portion of the Option (i.e.,
      Participant shall have such “anti-dilution” rights under the Option with respect
      to such events, but shall not have “preemptive” rights).

    

    d.     Shares
      Reserved.
      The
      Company shall at all times during the option period reserve and keep available
      such number of shares as will be sufficient to satisfy the requirements of
      this
      Agreement.

    

    e.     Withholding
      Taxes.
      In
      order to permit the Company to comply with all applicable federal or state
      income tax laws or regulations, the Company may take such action as it deems
      appropriate to insure that, if necessary, all applicable federal and state
      payroll, income or other taxes are withheld from any amounts payable by the
      Company to Participant. If the Company is unable to withhold such federal and
      state taxes, for whatever reason, Participant hereby agrees to pay to the
      Company an amount equal to the amount the Company would otherwise be required
      to
      withhold under federal or state law. Participant may, subject to the approval
      and discretion of the Administrator or such administrative rules it may deem
      advisable, to assure compliance with Rule 16b-3 of any successor provision,
      as
      then in effect of the General Rules and Regulations under the Securities and
      Exchange Act of 1934, if applicable, elect to have all or a portion of such
      tax
      withholding obligations satisfied by delivering shares of the Company’s Common
      Stock having a Fair Market Value equal to such obligations.

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    f.     Nontransferability.
      During
      the lifetime of Participant, the accrued Option shall be exercisable only by
      Participant or by the Participant’s guardian or other legal representative, and
      shall not be assignable or transferable by Participant, in whole or in part,
      other than by will or by the laws of descent and distribution.

    

    g.     2005
      Equity Incentive Plan.
      The
      Option evidenced by this Agreement is granted pursuant to the Plan, a copy
      of
      which Plan has been made available to Participant and is hereby incorporated
      into this Agreement. This Agreement is subject to and in all respects limited
      and conditioned as provided in the Plan. The Plan governs this Option and,
      in
      the event of any questions as to the construction of this Agreement or in the
      event of a conflict between the Plan and this Agreement, the Plan shall govern,
      except as the Plan otherwise provides.

    

    h.     Lockup
      Period Limitation.
      Participant agrees that in the event the Company advises Participant that it
      plans an underwritten public offering of its Common Stock in compliance with
      the
      Securities Act of 1933, as amended, and that the underwriter(s) seek to impose
      restrictions under which certain shareholders may not sell or contract to sell
      or grant any option to buy or otherwise dispose of part or all of their stock
      purchase rights of the underlying Common Stock, Participant hereby agrees that
      for a period not to exceed 180 days from the prospectus, Participant will not
      sell or contract to sell or grant an option to buy or otherwise dispose of
      this
      option or any of the underlying shares of Common Stock without the prior written
      consent of the underwriter(s) or its representative(s).

    

    i.     Blue
      Sky Limitation.
      Notwithstanding
      anything in this Agreement to the contrary, in the event the Company makes
      any
      public offering of its securities and determines, in its sole discretion, that
      it is necessary to reduce the number of issued but unexercised stock purchase
      rights so as to comply with any state securities or Blue Sky law limitations
      with respect thereto, the Board of Directors of the Company shall (i) accelerate
      the exercisability of this Option and the date on which this Option must be
      exercised, provided that the Company gives Participant 15 days’ prior written
      notice of such acceleration, and (ii) cancel any portion of this Option or
      any
      other option granted to Participant pursuant to the Plan which is not exercised
      prior to or contemporaneously with such public offering. Notice shall be deemed
      given when delivered personally or when deposited in the United States mail,
      first class postage prepaid and addressed to Participant at the address of
      Participant on file with the Company.

    

    j.     Accounting
      Compliance.
      Participant agrees that, if a merger, reorganization, liquidation or other
      “transaction” as defined in Section 12 of the Plan occurs and Participant is an
“affiliate” of the Company or any Affiliate (as defined in applicable legal and
      accounting principles) at the time of such transaction, Participant will comply
      with all requirements of Rule 145 of the Securities Act of 1933, as amended,
      and
      the requirements of such other legal or accounting principles, and will execute
      any documents necessary to ensure such compliance.

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    k.     Stock
      Legend.
      The
      Administrator may require that the certificates for any shares of Common Stock
      purchased by Participant (or, in the case of death, Participant’s successors)
      shall bear an appropriate legend to reflect the restrictions of Paragraphs
      4(b),
      4(h) and 4(i) of this Agreement.

    

       l.     Scope
      of Agreement; Amendment.
      This
      Agreement shall bind and inure to the benefit of the Company, its Affiliates
      and
      its successors and assigns and Participant and any successor or successors
      of
      Participant permitted by Paragraph 2 or Paragraph 4(f) above. Notwithstanding
      anything in this Agreement or the Plan to the contrary, the Company expressly
      reserves the right to amend this Agreement without Participant’s consent to the
      extent necessary or desirable to comply with Code Section 409A, and the
      regulations, notices and other guidance of general applicability issued
      thereunder. 

    

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
      on
      the day and year first above written.

    

    
 

    
      	 	 	 CAPE COASTAL TRADING
              CORPORATION
	 	 	 
	 	By:	 
	 	Its:	 
	 	 	 
	 	 
	 	Participant

    

     

     

    
      
         

      

      
        6EXHIBIT 10.1

                              FARMERS NATIONAL BANK
                              EXECUTIVE MANAGEMENT
                                  BONUS PROGRAM

I.   EFFECTIVE DATE

     The program will be in effect from January 1, 2006 through December 31,
     2006.

II.  PURPOSE

     The Farmers National Bank Executive Management Bonus Program ("the Plan")
     is intended to provide an annual bonus that will reward the performance of
     the members of Executive Management for directing the profitability of the
     institution.

     The Plan will be reviewed on an annual basis by the Board's Human Resources
     Committee and based on business conditions and recommendations will be
     submitted to the full Board of Directors for approval.

III. ELIGIBILITY

All Executive Management level employees who meet the following criteria:

--   Have been employed for at least 6 months as of December 31, 2006. (Those
     employees who worked less than the entire 2006 calendar year will receive a
     pro-rated payment based on the number of months employed.)

--   Have received a performance evaluation of at least "Meets Expectations".

     A.   Time missed in excess of accrued vacation paid and normal absence days
          will not be credited as time worked for purposes of plan payment.
     B.   Employees will not receive any portion or payment under the Plan
          unless the established goals have been attained.
     C.   An individual's participation is not assurance of participation in
          future years.

IV.  METHOD OF COMPENSATION

Direct deposit into employee payroll account.

V.   TIMING OF BONUS PAYMENTS

     A.   To be entitled to receive a payment as described in this policy, it is
          an expressed condition that the participant be employed with Farmers
          National Bank as of the date of payment.

<PAGE>

     B.   Payments under the Plan shall be made as soon as practicable after the
          organization's consolidated financial statements for the fiscal year
          period have been completed. Payment of the bonus awards shall be
          subject to withholdings in an amount sufficient to pay any tax
          required by law to be withheld and paid by the organization to
          appropriate governmental authorities.

VI.  BASIS FOR EARNING BONUS

--   As an entry point for the Plan, the holding company must realize Return on
     Average Equity ("ROE") goals as follows:

     o    Entry Level 10.54%
     o    Goal        10.64%
     o    Maximum     11.13%

     (Note: The ROE goal must be attained net of all bonus and profit sharing
     accruals.)

     Return on Average Equity is defined as total average capital less
     unrealized gains/losses on available for sale (AFS) securities.

--   Eligible Executive Management employees would receive the following
     percentage of their annual salary:

                                          Entry      Goal    Maximum
                                          -----      ----    -------
     o    President                         20%       25%        30%

     o    Senior Vice-President
          Chief Lending Officer             15%       20%        25%

     o    Senior Vice-President
          Chief Operating Officer           15%       20%        25%

     o    Vice-President
          Human Resources Director          10%       15%        20%

     o    Vice-President
          Controller                        10%       15%        20%

--   The actual amount paid will be based on the availability of sufficient Plan
     accrual. If sufficient accrual is not available, payments will be limited
     and distributed on a pro-rata basis.

<PAGE>

VII. CHANGE OF EMPLOYMENT STATUS

     A.   In the event that an employee ceases to be employed by the
          organization prior to the payout date, bonus payments under the Plan
          for the award period shall be treated as follows:

          If the termination is due to retirement, death or disability,
          payments, if earned, shall be paid to the employee at the normal
          payment date, with payment reduced pro-rata for the number of full
          months in which the employee was not employed during the award period.
          For purposes of this determination, employment services must exceed
          six months. No payments shall be made unless the Committee, in its
          sole discretion, determines that a payout should be made.

     B.   In the event that an employee's position status changes such that the
          change increases or decreases salary grade level during the plan year,
          while continuing to meet the eligibility requirements for the Plan,
          bonus awards under the Plan shall be prorated based on time in
          position.

VIII. PLAN COMMITTEE

     A.   The Plan will be administered by the Human Resources Committee.

     B.   The Human Resources Committee shall have the full and complete
          authority in its sole discretion, but subject to the expressed
          provisions of the Plan to:

          1.   determine the eligibility criteria for participation under the
               Plan;
          2.   determine the time such bonus awards shall be granted;
          3.   establish the terms and conditions upon which such bonus awards
               shall be made and become payable; and
          4.   adopt such rules and regulations deemed necessary or desirable
               for administration of the Plan.

The Human Resources Committee shall determine any facts necessary for the
administration of the Plan and respond to any questions concerning
interpretation or administration of the Plan. The good faith determination made
by the Human Resources Committee in response to such questions shall be final
and conclusive upon all parties.

IX.  NON-EMPLOYMENT CONTRACT

Nothing contained herein may be interpreted as an employee contract for a
particular position. Further, nothing contained in the Plan shall in any way be
construed as to amend or modify Farmers National Bank's at will relationships
with participants.

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