Document:

Exhibit 4.3

 

STC BANCSHARES CORP.

 

2016 EQUITY INCENTIVE PLAN

 

Article 1
 INTRODUCTION

 

Section 1.1                                   Purpose, Effective Date and Term. The purpose of this STC BANCSHARES CORP. 2016 EQUITY INCENTIVE PLAN is to promote the long-term financial success of STC Bancshares Corp. and its Subsidiaries by providing a means to attract, retain and reward individuals who can and do contribute to such success, and to further align their interests with those of the Shareholders. The “Effective Date” of the Plan is April 22, 2016. The Plan shall remain in effect as long as any Awards are outstanding; provided, however, that no Awards may be granted after the 10-year anniversary of the Effective Date.

 

Section 1.2                                   Participation. Each employee and director of, and service provider to, the Company and each Subsidiary who is granted, and currently holds, an Award in accordance with the provisions of the Plan shall be a “Participant” in the Plan. Award recipients shall be limited to employees and directors of, and service providers to, the Company and its Subsidiaries; provided, however, that an Award may be granted to an individual prior to the date on which he or she first performs services as an employee, director or service provider, provided that such Award does not become vested prior to the date such individual commences such services.

 

Section 1.3                                   Definitions. Capitalized terms in the Plan shall be defined as set forth in the Plan (including the definition provisions of Article 9).

 

Article 2
 AWARDS

 

Section 2.1                                   General. Any Award may be granted singularly, in combination with another Award (or Awards), or in tandem whereby the exercise or vesting of one Award held by a Participant cancels another Award held by the Participant. Each Award shall be subject to the provisions of the Plan and such additional provisions as the Committee may provide with respect to such Award and as may be evidenced in the Award Agreement. An Award may be granted as an alternative to or replacement of an existing award under the Plan, any other plan of the Company or a Subsidiary or as the form of payment for grants or rights earned or due under any other compensation plan or arrangement of the Company or a Subsidiary, including the plan of any entity acquired by the Company or a Subsidiary. The types of Awards that may be granted include the following:

 

(a)                                 Stock Options. A stock option represents the right to purchase Shares at an exercise price established by the Committee. Any stock option granted under the Plan shall be a nonqualified stock option. No stock options that are intended to satisfy the requirements applicable to “incentive stock options” described in Code Section 422(b) shall be granted under the Plan.

 

(b)                                 Stock Appreciation Rights. A stock appreciation right (an “SAR”) is a right to receive, in cash, Shares or a combination of both (as shall be reflected in the respective Award Agreement), an amount equal to or based upon the excess of (i) the Fair Market Value at the time of exercise of the SAR over (ii) an exercise price established by the Committee.

 

 

(c)                                  Stock Awards. A stock award is a grant of Shares or a right to receive Shares (or their cash equivalent or a combination of both, as shall be reflected in the respective Award Agreement) in the future, excluding Awards designated as stock options, SARs or cash incentive awards by the Committee. Such Awards may include bonus shares, performance shares, performance units, restricted stock, restricted stock units or any other equity-based Award as determined by the Committee.

 

(d)                                 Cash Incentive Awards. A cash incentive award is the grant of a right to receive a payment of cash (or Shares having a value equivalent to the cash otherwise payable, excluding Awards designated as stock options, SARs or stock awards by the Committee, all as shall be reflected in the respective Award Agreement) determined on an individual basis or as an allocation of an incentive pool that is contingent on the achievement of performance objectives established by the Committee.

 

Section 2.2                                   Exercise of Stock Options and SARs. A stock option or SAR shall be exercisable in accordance with such provisions as may be established by the Committee; provided, however, that a stock option or SAR shall expire no later than 10 years after its grant date. The exercise price of each stock option and SAR shall be not less than 100% of the Fair Market Value on the grant date (or, if greater, the par value of a Share); provided, however, that to the extent permitted under Code Section 409A, the exercise price may be higher or lower in the case of stock options and SARs granted in replacement of existing awards held by an employee, director or service provider granted by an acquired entity. The payment of the exercise price of a stock option shall be by cash or, subject to limitations imposed by applicable law, by any of the following means unless otherwise determined by the Committee from time to time: (a) by tendering, either actually or by attestation, Shares acceptable to the Committee and valued at Fair Market Value as of the day of exercise; (b) by irrevocably authorizing a third party, acceptable to the Committee, to sell Shares acquired upon exercise of the stock option and to remit to the Company no later than the third business day following exercise of a sufficient portion of the sale proceeds to pay the entire exercise price and any tax withholding resulting from such exercise; (c) by payment through a net exercise such that, without the payment of any funds, the Participant may exercise the option and receive the net number of Shares equal in value to (i) the number of Shares as to which the option is being exercised, multiplied by (ii) a fraction, the numerator of which is the Fair Market Value (on the date of exercise) less the exercise price, and the denominator of which is such Fair Market Value (the number of net Shares to be received shall be rounded down to the nearest whole number of Shares); (d) by personal, certified or cashiers’ check; (e) by other property deemed acceptable by the Committee or (f) by any combination thereof.

 

Section 2.3                                   Dividends and Dividend Equivalents. Any Award may provide the Participant with the right to receive dividend payments or dividend equivalent payments with respect to Shares subject to the Award, which payments may be made currently or credited to an account for the Participant, may be settled in cash or Shares and may be subject to terms or provisions similar to the underlying Award.

 

Section 2.4                                   Forfeiture of Awards. Unless specifically provided to the contrary in an Award Agreement, upon notification of Termination of Service for Cause, any outstanding Award held by a Participant, whether vested or unvested, shall terminate immediately, such Award shall be forfeited and the Participant shall have no further rights thereunder.

 

Section 2.5                                   Deferred Compensation. The Plan is, and all Awards are, intended to be exempt from (or, in the alternative, to comply with) Code Section 409A, and each shall be construed, interpreted and administered accordingly. The Company does not guarantee that any benefits that may be provided under the Plan will satisfy all applicable provisions of Code Section 409A. If any Award would be considered “deferred compensation” under Code Section 409A, the Committee reserves the absolute right

 

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(including the right to delegate such right) to unilaterally amend the Plan or the applicable Award Agreement, without the consent of the Participant, to avoid the application of, or to maintain compliance with, Code Section 409A. Any amendment by the Committee to the Plan or an Award Agreement pursuant to this Section 2.5 shall maintain, to the extent practicable, the original intent of the applicable provision without violating Code Section 409A. A Participant’s acceptance of any Award shall be deemed to constitute the Participant’s acknowledgment of, and consent to, the rights of the Committee under this Section 2.5, without further consideration or action. Any discretionary authority retained by the Committee pursuant to the terms of the Plan or pursuant to an Award Agreement shall not be applicable to an Award that is determined to constitute deferred compensation, if such discretionary authority would contravene Code Section 409A.

 

Article 3
 SHARES SUBJECT TO PLAN

 

Section 3.1                                   Available Shares. The Shares with respect to which Awards may be granted shall be Shares currently authorized but unissued, currently held or, to the extent permitted by applicable law, subsequently acquired by the Company, including Shares purchased in the open market or in private transactions.

 

Section 3.2                                   Share Limitations.

 

(a)                                 Share Reserve. Subject to the following provisions of this Section 3.2, the maximum number of Shares that may be delivered under the Plan shall be 75,000 Shares. The maximum number of Shares available for delivery under the Plan and the number of Shares subject to outstanding Awards shall be subject to adjustment as provided in Section 3.3.

 

(b)                                 Reuse of Shares.

 

(i)                                     To the extent any Shares covered by an Award are not delivered to a Participant or beneficiary for any reason, including because the Award is forfeited, canceled or settled in cash, such Shares shall not be deemed to have been delivered for purposes of determining the maximum number of Shares available for delivery under the Plan and shall again become eligible for delivery under the Plan.

 

(ii)                                  With respect to SARs that are settled in Shares, only Shares actually delivered shall be counted for purposes of determining the maximum number of Shares available for delivery under the Plan.

 

(iii)                               If the exercise price of any stock option granted under the Plan is satisfied by tendering Shares to the Company (whether by actual delivery or by attestation and whether or not such surrendered Shares were acquired pursuant to an Award) or by the net exercise of the Award, only the number of Shares delivered net of the Shares tendered shall be deemed delivered for purposes of determining the maximum number of Shares available for delivery under the Plan.

 

(iv)                              If the withholding tax liabilities arising from an Award are satisfied by the tendering of Shares to the Company (whether by actual delivery or by attestation and whether or not such tendered Shares were acquired pursuant to an Award) or by the withholding of or reduction of Shares by the Company, such Shares shall not be deemed to have been delivered for purposes of

 

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determining the maximum number of Shares available for delivery under the Plan and shall again become eligible for delivery under the Plan.

 

Section 3.3                                   Corporate Transactions. To the extent permitted under Code Section 409A and, to the extent applicable, in the event of a corporate transaction involving the Company or the Shares (including any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination or exchange of shares), all outstanding Awards and the number of Shares available for delivery under the Plan under Section 3.2 shall be adjusted automatically to proportionately and uniformly reflect such transaction; provided, however, that the Committee may otherwise adjust Awards (or prevent such automatic adjustment) as it deems necessary, in its sole discretion, to preserve the benefits or potential benefits of the Awards and the Plan. Action by the Committee under this Section 3.3 may include: (i) adjustment of the number and kind of shares that may be delivered under the Plan; (ii) adjustment of the number and kind of shares subject to outstanding Awards; (iii) adjustment of the exercise price of outstanding stock options and SARs; and (iv) any other adjustments that the Committee determines to be equitable (which may include (A) replacement of an Award with another award that the Committee determines has comparable value and that is based on stock of a company resulting from a corporate transaction, and (B) cancellation of an Award in return for cash payment of the current value of the Award, determined as though the Award were fully vested at the time of payment, provided that in the case of a stock option or SAR, the amount of such payment shall be the excess of the value of the stock subject to the option or SAR at the time of the transaction over the exercise price, and provided, further, that no such payment shall be required in consideration for the cancellation of the Award if the exercise price is greater than the value of the stock at the time of such corporate transaction).

 

Section 3.4                                   Delivery of Shares. Delivery of Shares or other amounts under the Plan shall be subject to the following:

 

(a)                                 Compliance with Applicable Laws. Notwithstanding any provision of the Plan to the contrary, the Company shall have no obligation to deliver any Shares or make any other distribution of benefits under the Plan unless such delivery or distribution complies with all applicable laws and the applicable requirements of any securities exchange or similar entity.

 

(b)                                 No Certificates Required. To the extent that the Plan provides for the delivery of Shares, the delivery may be effected on a non-certificated basis, to the extent not prohibited by applicable law or the applicable rules of any securities exchange or similar entity.

 

Article 4
 CHANGE IN CONTROL

 

Section 4.1                                   Consequence of a Change in Control. Subject to the provisions of Section 3.3 (relating to the adjustment of shares), and except as otherwise provided in the Plan or in any Award Agreement, at the time of a Change in Control:

 

(a)                                 Subject to any forfeiture and expiration provisions otherwise applicable to the respective Awards, all stock options and SARs under the Plan then held by the Participant shall become fully exercisable immediately if, and all stock awards and cash incentive awards under the Plan then held by the Participant shall become fully earned and vested immediately if, (i) the Plan and the respective Award Agreements are not the obligations of the entity, whether the Company, a successor thereto or an assignee thereof, that conducts following a Change in Control substantially all of the business conducted

 

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by the Company and its Subsidiaries immediately prior to such Change in Control or (ii) the Plan and the respective Award Agreements are the obligations of the entity, whether the Company, a successor thereto or an assignee thereof, that conducts following a Change in Control substantially all of the business conducted by the Company and its Subsidiaries immediately prior to such Change in Control and the Participant incurs a Termination of Service without Cause or by the Participant for Good Reason following such Change in Control.

 

(b)                                 Notwithstanding the foregoing provisions of this Section 4.1, if the vesting of an outstanding Award is conditioned upon the achievement of performance measures, then such vesting shall be subject to the following:

 

(i)                                     If, at the time of the Change in Control, the established performance measures are less than 50% attained (as determined in the sole discretion of the Committee, but in any event, based pro rata in accordance with time lapsed through the date of the Change in Control in the event of any period-based performance measures), then such Award shall become vested and exercisable on a fractional basis with the numerator being equal to the percentage of attainment and the denominator being 50% upon the Change in Control.

 

(ii)                                  If, at the time of the Change in Control, the established performance measures are at least 50% attained (as determined in the sole discretion of the Committee, but in any event based pro rata in accordance with time lapsed through the date of the Change in Control in the event of any period-based performance measures), then such Award shall become fully earned and vested immediately upon the Change in Control.

 

Section 4.2                                   Definition of Change in Control.

 

(a)                                 For purposes of the Plan, “Change in Control” means the first to occur of the following:

 

(i)                                     The consummation of the acquisition by any “person” (as such term is defined in Section 13(d) or 14(d) of the Exchange Act) of “beneficial ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the combined voting power of the then outstanding Voting Securities of the Company;

 

(ii)                                  During any 12-month period, the individuals who, as of the Effective Date, are members of the Board cease for any reason to constitute a majority of the Board, unless either the election of, or the nomination for election by, the Shareholders of any new director was approved by a vote of a majority of the Board, in which case such new director shall for purposes of this Plan be considered as a member of the Board; or

 

(iii)                               The consummation by the Company of (i) a merger, consolidation or other similar transaction if the Shareholders immediately before such merger, consolidation or other similar transaction do not, as a result of such merger, consolidation or other similar transaction, own, directly or indirectly, more than 50% of the combined voting power of the then outstanding Voting Securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the Voting Securities of the Company outstanding immediately before such merger or consolidation or (ii) a complete liquidation or dissolution of, or an agreement for the sale or other disposition of, all or substantially all of the assets of the Company.

 

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(b)                                  Notwithstanding any provision in the foregoing definition of Change in Control to the contrary, a Change in Control shall not be deemed to occur solely because 50% or more of the combined voting power of the then outstanding securities of the Company are acquired by (i) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the entity or (ii) any corporation that, immediately prior to such acquisition, is owned directly or indirectly by the Shareholders in the same proportion as their ownership of Stock immediately prior to such acquisition.

 

(c)                                   Further notwithstanding any provision in the foregoing definition of Change In Control to the contrary, in the event that any Award constitutes deferred compensation, and the settlement of, or distribution of benefits under such Award is to be triggered by a Change in Control, then such settlement or distribution shall be subject to the event constituting the Change in Control also constituting a “change in control event” under Code Section 409A.

 

Article 5
 COMMITTEE

 

Section 5.1                                   Administration. The authority to control and manage the operation and administration of the Plan shall be vested in the Committee in accordance with this Article 5. The Committee shall be selected by the Board. Subject to the applicable rules of any securities exchange or similar entity, if the Committee does not exist, or for any other reason determined by the Board, the Board may take any action under the Plan that would otherwise be the responsibility of the Committee.

 

Section 5.2                                   Powers of Committee. The Committee’s administration of the Plan shall be subject to the other provisions of the Plan and the following:

 

(a)                                 The Committee shall have the authority and discretion to select from among the Company’s and the Subsidiaries’ employees, directors and service providers those persons who shall receive Awards, to determine the time or times of receipt, to determine the types of Awards and the number of Shares covered by the Awards, to establish the terms of Awards, to cancel or suspend Awards and to reduce or eliminate any restrictions or vesting requirements applicable to an Award at any time after the grant of the Award.

 

(b)                                 The Committee shall have the authority and discretion to interpret the Plan, to establish, amend and rescind any rules and regulations relating to the Plan and to make all other determinations that may be necessary or advisable for the administration of the Plan.

 

(c)                                  The Committee shall have the authority to define terms not otherwise defined in the Plan.

 

(d)                                 Any interpretation of the Plan by the Committee and any decision made by it under the Plan shall be final and binding on all persons.

 

(e)                                  In controlling and managing the operation and administration of the Plan, the Committee shall take action in a manner that conforms to the articles and bylaws of the Company and to all applicable law.

 

Section 5.3                                   Delegation by Committee. Except to the extent prohibited by applicable law, the applicable rules of any securities exchange or similar entity, the Plan or the charter of the Committee, the Committee may allocate all or any portion of its responsibilities and powers to any one or more of its

 

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members and may delegate all or any part of its responsibilities and powers under the Plan to any person or persons selected by it. The acts of such delegates shall be treated under the Plan as acts of the Committee and such delegates shall report regularly to the Committee regarding the delegated duties and responsibilities and any Awards granted. Any such allocation or delegation may be revoked by the Committee at any time.

 

Section 5.4                                   Information to be Furnished to Committee. As may be permitted by applicable law, the Company and each Subsidiary shall furnish the Committee with such data and information as it determines may be required for it to discharge its duties under the Plan. The records of the Company and each Subsidiary as to an employee’s or Participant’s employment, termination of employment, leave of absence, reemployment and compensation shall be conclusive with respect to all persons unless determined by the Committee to be manifestly incorrect. Subject to applicable law, Participants and other persons entitled to benefits under the Plan shall furnish the Committee such evidence, data or information as the Committee considers desirable to carry out the terms of the Plan.

 

Section 5.5                                   Expenses and Liabilities. All expenses and liabilities incurred by the Committee in the administration and interpretation of the Plan or any Award Agreement shall be borne by the Company. The Committee may employ attorneys, consultants, accountants or other persons in connection with the administration and interpretation of the Plan, and the Company, and its officers and directors, shall be entitled to rely upon the advice, opinions and valuations of any such persons.

 

Article 6
 AMENDMENT AND TERMINATION

 

Section 6.1                                   General. The Board may, as permitted by law, at any time, amend or terminate the Plan, and may amend any Award Agreement; provided, however, that no amendment or termination may (except as provided in Section 2.5, Section 3.3 and Section 6.2), in the absence of written consent to the change by the affected Participant (or, if the Participant is not then living, the affected beneficiary), impair the rights of any Participant or beneficiary under any Award granted prior to the date such amendment or termination is adopted by the Board.

 

Section 6.2                                   Amendment to Conform to Law. Notwithstanding any provision of the Plan or an Award Agreement to the contrary, the Committee may amend the Plan or any Award Agreement, to take effect retroactively or otherwise, as deemed necessary or advisable for the purpose of conforming the Plan or the Award Agreement to any applicable law. By accepting an Award, the Participant shall be deemed to have acknowledged and consented to any amendment to an Award made pursuant to this Section 6.2, Section 2.5 or Section 3.3 without further consideration or action.

 

Article 7
 PURCHASE AND SALE RIGHTS

 

Section 7.1                                   Additional Conditions of Transfer. Except as permitted by the Plan or with the prior written consent of the Company, a Participant shall not sell, transfer, pledge, assign or otherwise alienate or hypothecate any Owned Shares. If a Participant sells, transfers, pledges, assigns or otherwise alienates or hypothecates any Owned Shares in breach of the Plan, the Company shall not be required to (a) transfer such Owned Shares on its books or (b) treat any transferee as owner of such Owned Shares, to accord the right to vote as such owner or to pay dividends to any such transferee.

 

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Section 7.2                                   Legend. Each certificate evidencing Owned Shares and each certificate issued in exchange for or upon the transfer of any Owned Shares shall be stamped or otherwise imprinted with such legend as the Company may require.

 

Section 7.3                                   Company’s Call Rights. If the Participant incurs a Termination of Service for any reason, the Company shall have the right to purchase, and the Participant (or the Participant’s estate or beneficiary, if applicable) shall be required to sell to the Company, any or all of the Owned Shares then held by such person on the following terms (the “Company Call Right”):

 

(a)                                 The purchase price per Owned Share shall be equal to the Fair Market Value thereof on the date on which the Call Notice is delivered; provided, however, that if the Participant’s Termination of Service is for Cause, the purchase price per Owned Share shall be equal to the lesser of (i) the Fair Market Value of a Share on the date on which the Call Notice is delivered and (ii) the price paid for the Owned Share (which may be $0).

 

(b)                                 If the Company desires to exercise its right to purchase Owned Shares pursuant to this Section 7.3, the Company shall deliver written notice thereof (the “Call Notice”) to the Participant (or to the Participant’s estate or beneficiary, if applicable) of its intention to purchase Owned Shares within 90 days following the date of the Participant’s Termination of Service. The Call Notice shall state that the Company has elected to exercise the Company Call Right and shall specify the number and price of Owned Shares with respect to which the Company Call Right is being exercised.

 

(c)                                  The closing of any purchase under this Section 7.3 shall take place at the principal office of the Company on a date specified by the Company, which date shall be no later than the 30th day after the giving of the Call Notice.

 

Section 7.4                                   Company’s Right of First Refusal.

 

(a)                                 In the event the Participant receives a bona fide offer to sell, pledge or otherwise transfer to a third party any Owned Shares, or any interest in Owned Shares, the Company shall have a “Right of First Refusal” with respect to all such Owned Shares. If the Participant wishes to transfer Owned Shares, the Participant shall first provide written notice (the “Transfer Notice”) to the Company describing fully the proposed transfer, including the number of Owned Shares proposed to be transferred, the proposed transfer price and the name and address of the proposed transferee. The Transfer Notice shall be signed both by the Participant and by the proposed transferee and must constitute a binding commitment of both parties to the transfer of the Owned Shares, subject to the Company’s Right of First Refusal.

 

(b)                                 In connection with its Right of First Refusal, the Company shall have the right to purchase all of the Owned Shares on the terms described in the Transfer Notice (subject to any change in such terms permitted in Section 7.4(c)) by delivery of a notice of exercise of the Right of First Refusal within 30 days after the date the Company receives the Transfer Notice. The Company’s rights with respect to the Right of First Refusal shall be freely assignable, in whole or in part.

 

(c)                                  If the Company fails to exercise the Right of First Refusal within 30 days after the date that the Company receives the Transfer Notice, the Participant may, not later than 60 days following the date the Company receives the Transfer Notice, conclude a transfer of the Owned Shares subject to the Transfer Notice on the terms described in the Transfer Notice, provided that the transferee acknowledges in writing that such transferee remains bound by the Right of First Refusal with respect to any subsequent transfer of such Owned Shares.

 

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(d)                                 Any proposed transfer on terms different from those described in the Transfer Notice, as well as any subsequent proposed transfer by the Participant, shall again be subject to the Right of First Refusal and shall require compliance with the procedure described in this Section 7.4. If the Company exercises its Right of First Refusal, the Participant and the Company shall consummate the sale of the Owned Shares on the terms set forth in the Transfer Notice.

 

Section 7.5                                   Delivery of Owned Shares to the Company.

 

(a)                                 On or before the close of business on the date specified for the purchase, the Participant shall deliver to the Company all certificates representing the Participant’s Owned Shares to be purchased in connection with the Company Call Right pursuant to Section 7.3, with appropriate executed stock transfers conveying, representing and warranting good title to the Company for the Participant’s Owned Shares in compliance with the terms of the Plan and free and clear of all liens, encumbrances or claims of any third party.

 

(b)                                 Within 10 days after the Company’s exercise of its Right of First Refusal, the Participant shall deliver to the Company all certificates representing the Participant’s Owned Shares to be purchased in connection with the Right of First Refusal pursuant to Section 7.4, with appropriate executed stock transfers conveying, representing and warranting good title to the Company for the Participant’s Owned Shares in compliance with the terms of the Plan and free and clear of all liens, encumbrances or claims of any third party.

 

Section 7.6                                   Payment of Purchase Price to Participant. Concurrently with the receipt of certificates by the Company in accordance with Section 7.5, the purchase price of the Participant’s Owned Shares shall be payable, at the option of the Company, by check, with a subordinated note, by cancellation of all or a portion of any outstanding indebtedness owed by the Participant to the Company, or by a combination thereof, in each case subject to Section 7.7.

 

Section 7.7                                   Additional Conditions. All purchases of Owned Shares by the Company pursuant to this Article 7 shall be subject to any applicable restrictions under federal and state securities laws, and to the terms of the credit facilities of the Company and its Subsidiaries then in effect.

 

Article 8
 GENERAL TERMS

 

Section 8.1                                   No Implied Rights.

 

(a)                                 No Rights to Specific Assets. No person shall by reason of participation in the Plan acquire any right in or title to any assets, funds or property of the Company or any Subsidiary, including any specific funds, assets, or other property that the Company or a Subsidiary, in its sole discretion, may set aside in anticipation of a liability under the Plan. A Participant shall have only a contractual right to the Shares or amounts, if any, distributable in accordance with the provisions of the Plan, unsecured by any assets of the Company or any Subsidiary, and nothing contained in the Plan or an Award Agreement shall constitute a guarantee that the assets of the Company or any Subsidiary shall be sufficient to provide any benefits to any person.

 

(b)                                 No Contractual Right to Employment or Future Awards. The Plan does not constitute a contract of employment, and selection as a Participant shall not give any person the right to be retained in the service of the Company or a Subsidiary or any right or claim to any benefit under the

 

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Plan, unless such right or claim has specifically accrued under the Plan. No individual shall have the right to be selected to receive an Award, or, having been so selected, to receive a future Award.

 

(c)                                  No Rights as a Shareholder. Except as otherwise provided in the Plan, no Award shall confer upon the holder thereof any rights as a Shareholder prior to the date on which the individual fulfills all conditions for receipt of such rights.

 

Section 8.2                                   Transferability. Except as otherwise provided by the Committee, Awards are not transferable except as designated by the Participant by will or by the laws of descent and distribution or pursuant to a “domestic relations order”. The Committee shall have the discretion to permit the transfer of Awards; provided, however, that such transfers shall be limited to immediate family members of Participants, trusts, partnerships, and limited liability companies established for the primary benefit of such family members; and provided, further, that such transfers shall not be made for value to the Participant.

 

Section 8.3                                   Designation of Beneficiaries. A Participant hereunder may file with the Company a designation of a beneficiary or beneficiaries under the Plan and may from time to time revoke or amend any such designation. Any designation of beneficiary under the Plan shall be controlling over any other disposition, testamentary or otherwise; provided, however, that if the Committee is in doubt as to the entitlement of any such beneficiary to any Award, the Committee may determine to recognize only the legal representative of the Participant in which case the Company, the Committee and the members thereof shall not have any further liability to anyone.

 

Section 8.4                                   Non-Exclusivity. Neither the adoption of the Plan by the Board nor the submission of the Plan to the Shareholders for approval shall be construed as creating any limitations on the power of the Board or the Committee to adopt such other incentive arrangements as either may deem desirable, and such arrangements may be either generally applicable or applicable only in specific cases.

 

Section 8.5                                   Award Agreement. Each Award shall be evidenced by an Award Agreement. A copy of the Award Agreement, in any medium chosen by the Committee, shall be made available to the Participant, and the Committee may require that the Participant sign a copy of the Award Agreement.

 

Section 8.6                                   Form and Time of Elections. Unless otherwise specified in the Plan, each election required or permitted to be made by any Participant or other person entitled to benefits under the Plan, and any permitted modification, or revocation thereof, shall be filed with the Company at such times, in such form, and subject to such terms or conditions, not inconsistent with the provisions of the Plan, as the Committee may require.

 

Section 8.7                                   Evidence. Evidence required of anyone under the Plan may be by certificate, affidavit, document or other information that the person acting on it considers pertinent and reliable, and signed, made or presented by the proper party or parties.

 

Section 8.8                                   Tax Withholding. All distributions under the Plan shall be subject to withholding of all applicable taxes and the Committee may condition the delivery of any Shares or other benefits under the Plan on satisfaction of the applicable withholding obligations. Except as otherwise provided by the Committee, such withholding obligations may be satisfied (a) through cash payment by the Participant; (b) through the surrender of Shares that the Participant already owns or (c) through the surrender of Shares to which the Participant is otherwise entitled under the Plan; provided, however, that except as otherwise specifically provided by the Committee, such Shares under clause (c) may not be used to satisfy more than the Company’s minimum statutory withholding obligation.

 

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Section 8.9                                   Successors. All obligations of the Company under the Plan shall be binding upon and inure to the benefit of any successor to the Company.

 

Section 8.10                            Indemnification. To the fullest extent permitted by law, each person who is or shall have been a member of the Committee or the Board, or an officer of the Company to whom authority was delegated in accordance with Section 5.3, or an employee of the Company shall be indemnified and held harmless by the Company against and from any loss (including amounts paid in settlement), cost, liability or expense (including reasonable attorneys’ fees) that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him or her in settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such action, suit, or proceeding against him or her (provided that he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf), unless such loss, cost, liability or expense is a result of his or her own willful misconduct or except as expressly provided by statute. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s charter or bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.

 

Section 8.11                            No Fractional Shares. Unless otherwise permitted by the Committee, no fractional Shares shall be delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, Shares or other property shall be delivered or paid in lieu of fractional Shares or whether such fractional Shares or any rights thereto shall be forfeited or otherwise eliminated.

 

Section 8.12                            Governing Law. The Plan, all Awards, and all actions taken in connection herewith and therewith shall be governed by and construed in accordance with the laws of the State of Illinois without reference to principles of conflict of laws, except as superseded by applicable federal law.

 

Section 8.13                            Benefits Under Other Plans. Except as otherwise provided by the Committee, Awards granted to a Participant (including the grant and the receipt of benefits) shall be disregarded for purposes of determining the Participant’s benefits under, or contributions to, any qualified retirement plan, nonqualified plan and any other benefit plan maintained by the Participant’s employer.

 

Section 8.14                            Validity. If any provision of the Plan is determined to be illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining provisions of the Plan, and the Plan shall be construed and enforced as if such illegal or invalid provision had never been included in the Plan.

 

Section 8.15                            Notice. Unless provided otherwise in an Award Agreement or policy adopted from time to time by the Committee, all communications to the Company provided for in the Plan, or any Award Agreement, shall be delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid (provided that international mail shall be sent via overnight or two-day delivery), or sent by facsimile or prepaid overnight courier to the Company at the address set forth below:

 

STC Bancshares Corp.

460 South 1st Street

St. Charles, Illinois 60174

Facsimile: (   )

 

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Such communications shall be deemed given:

 

(a)                                 In the case of delivery by overnight service with guaranteed next day delivery, the next day or the day designated for delivery;

 

(b)                                 In the case of certified or registered U.S. mail, five days after deposit in the U.S. mail; or

 

(c)                                  In the case of facsimile, the date upon which the transmitting party receives confirmation of receipt by facsimile, telephone or otherwise;

 

provided, however, that in no event shall any communication be deemed to be given later than the date it is actually received, provided it is actually received. In the event a communication is not received, it shall be deemed received only upon the showing of an original of the applicable receipt, registration or confirmation from the applicable delivery service provider. Communications that are to be delivered by facsimile, U.S. mail or by overnight service to the Company shall be directed to the attention of the Company’s senior human resources officer and corporate secretary.

 

Section 8.16                            Clawback Policy. Any Award, amount or benefit received under the Plan shall be subject to potential cancellation, recoupment, rescission, payback or other similar action in accordance with any applicable Company clawback policy (the “Policy”) or any applicable law. A Participant’s receipt of an Award shall be deemed to constitute the Participant’s acknowledgment of and consent to the Company’s application, implementation and enforcement of (i) the Policy and any similar policy established by the Company that may apply to the Participant, whether adopted prior to or following the making of any Award and (ii) any provision of applicable law relating to cancellation, rescission, payback or recoupment of compensation, as well as the Participant’s express agreement that the Company may take such actions as are necessary to effectuate the Policy, any similar policy and applicable law, without further consideration or action.

 

Article 9
 DEFINED TERMS; CONSTRUCTION

 

Section 9.1                                   Definitions. In addition to the other definitions contained in the Plan, unless otherwise specifically provided in an Award Agreement, the following definitions shall apply:

 

(a)                                 “Award” means an award under the Plan.

 

(b)                                 “Award Agreement” means the document that evidences the terms and conditions of an Award. Such document shall be referred to as an agreement regardless of whether a Participant’s signature is required.

 

(c)                                  “Board” means the Board of Directors of the Company.

 

(d)                                 “Call Notice” has the meaning ascribed to it in Section 7.3(b).

 

(e)                                  If the Participant is subject to an employment agreement (or other similar agreement) with the Company or a Subsidiary that provides a definition of termination for “cause” (or the like), then, for purposes of the Plan, the term “Cause” has the meaning set forth in such agreement; and in the absence of such a definition, “Cause” means (i) any act of (A) fraud or intentional misrepresentation or (B) embezzlement, misappropriation or conversion of assets or opportunities of the Company or a

 

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Subsidiary, (ii) willful violation of any law, rule or regulation in connection with the performance of a Participant’s duties to the Company or a Subsidiary (other than traffic violations or similar offenses), (iii) with respect to any employee of the Company or a Subsidiary, commission of any act of moral turpitude or conviction of a felony or (iv) the willful or negligent failure of the Participant to perform the Participant’s duties to the Company or a Subsidiary in any material respect.

 

Further, the Participant shall be deemed to have terminated for Cause if, after the Participant’s Termination of Service, facts and circumstances arising during the course of the Participant’s employment with the Company are discovered that would have constituted a termination for Cause.

 

Further, all rights a Participant has or may have under the Plan shall be suspended automatically during the pendency of any investigation by the Board or its designee or during any negotiations between the Board or its designee and the Participant regarding any actual or alleged act or omission by the Participant of the type described in the applicable definition of “Cause.”

 

(f)                                   “Change in Control” has the meaning ascribed to it in Section 4.2.

 

(g)                                 “Code” means the Internal Revenue Code of 1986.

 

(h)                                 “Committee” means the Committee acting under Article 5, and in the event a Committee is not currently appointed, the Board.

 

(i)                                    “Company” means STC Capital Corp., an Illinois corporation.

 

(j)                                    “Company Call Right” has the meaning ascribed to it in Section 7.3.

 

(k)                                 “Disability” means the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or last for a continuous period of not less than 12 months, or is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident or health plan covering the Company’s or a Subsidiary’s employees.

 

(l)                                    “Effective Date” has the meaning ascribed to it in Section 1.1.

 

(m)                             “Exchange Act” means the Securities Exchange Act of 1934.

 

(n)                                 “Fair Market Value” means, as of any date, the officially-quoted closing selling price of the Shares on such date on the principal national securities exchange on which Shares are listed or admitted to trading or, if there have been no sales with respect to Shares on such date, or if the Shares are not so listed or admitted to trading, the Fair Market Value shall be the value established by the Committee in good faith and, to the extent required, in accordance with Code Sections 409A.

 

(o)                                 If the Participant is subject to an employment agreement (or other similar agreement) with the Company or a Subsidiary that provides a definition of termination for “good reason” (or the like), then, for purposes of the Plan, the term “Good Reason” has the meaning set forth in such agreement; and in the absence of such a definition, “Good Reason” means the occurrence of any one of the following events, unless the Participant agrees in writing that such event shall not constitute Good Reason:

 

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(i)                                     A material, adverse change in the nature, scope or status of the Participant’s position, authorities or duties from those in effect immediately prior to the applicable Change in Control;

 

(ii)                                  A material reduction in the Participant’s aggregate compensation or benefits in effect immediately prior to the applicable Change in Control; or

 

(iii)                               Relocation of the Participant’s primary place of employment of more than 50 miles from the Participant’s primary place of employment immediately prior to the applicable Change in Control, or a requirement that the Participant engage in travel that is materially greater than prior to the applicable Change in Control.

 

Notwithstanding any provision of this definition to the contrary, prior to the Participant’s Termination of Service for Good Reason, the Participant must give the Company written notice of the existence of any condition set forth in clause (i) — (iii) immediately above within 90 days of its initial existence and the Company shall have 30 days from the date of such notice in which to cure the condition giving rise to Good Reason, if curable. If, during such 30-day period, the Company cures the condition giving rise to Good Reason, the condition shall not constitute Good Reason. Further notwithstanding any provision of this definition to the contrary, in order to constitute a termination for Good Reason, such termination must occur within 12 months of the initial existence of the applicable condition.

 

(p)                                 “Owned Shares” means Shares acquired in connection with an Award.

 

(q)                                 “Participant” has the meaning ascribed to it in Section 1.2.

 

(r)                                  “Plan” means the STC Bancshares Corp. 2016 Equity Incentive Plan.

 

(s)                                   “Policy” has the meaning ascribed to it in Section 8.16.

 

(t)                                    “Right of First Refusal” has the meaning ascribed to it in Section 7.4(a).

 

(u)                                 “SAR” has the meaning ascribed to it in Section 2.1(b).

 

(v)                                 “Securities Act” means the Securities Act of 1933.

 

(w)                               “Share” means a share of Stock.

 

(x)                                 “Shareholders” means the shareholders of the Company.

 

(y)                                 “Stock” means the common stock of the Company, $1.00 par value per share.

 

(z)                                  “Subsidiary” means any corporation or other entity that would be a “subsidiary corporation,” as defined in Code Section 424(f), with respect to the Company.

 

(aa)                          “Termination of Service” means the first day occurring on or after a grant date on which the Participant ceases to be an employee or director of, or service provider to, the Company and each Subsidiary, regardless of the reason for such cessation, subject to the following:

 

(i)                                     The Participant’s cessation as an employee or service provider shall not be deemed to occur by reason of the Participant’s being on a leave of absence from the Company or a Subsidiary approved by the Company or Subsidiary otherwise receiving the Participant’s services.

 

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(ii)                                  If, as a result of a sale or other transaction, the Subsidiary for whom the Participant is employed (or to whom the Participant is providing services) ceases to be a Subsidiary, and the Participant is not, following the transaction, an employee or director of, or service provider to, the Company or an entity that is then a Subsidiary, then the occurrence of such transaction shall be treated as the Participant’s Termination of Service caused by the Participant being discharged by the entity for whom the Participant is employed or to whom the Participant is providing services.

 

(iii)                               A service provider, other than an employee or director, whose services to the Company or a Subsidiary are governed by a written agreement with such service provider shall cease to be a service provider at the time the provision of service under such written agreement ends (without renewal); and such a service provider whose services to the Company or a Subsidiary are not governed by a written agreement with the service provider shall cease to be a service provider on the date that is 90 days after the date the service provider last provides services requested by the Company or a Subsidiary.

 

(iv)                              Notwithstanding the foregoing, in the event that any Award constitutes deferred compensation, the term Termination of Service shall be interpreted by the Committee in a manner consistent with the definition of “separation from service” as defined under Code Section 409A.

 

(bb)                          “Transfer Notice” has the meaning ascribed to it in Section 7.4(a).

 

(cc)                            “Voting Securities” means any securities that ordinarily possess the power to vote in the election of directors without the happening of any precondition or contingency.

 

Section 9.2                                   Construction. In the Plan, unless otherwise stated, the following uses apply:

 

(a)                                 Actions permitted under the Plan may be taken at any time in the actor’s reasonable discretion;

 

(b)                                 References to a statute shall refer to the statute and any amendments and any successor statutes, and to all regulations promulgated under or implementing the statute, as amended, or its successors, as in effect at the relevant time;

 

(c)                                  In computing periods from a specified date to a later specified date, the words “from” and “commencing on” (and the like) mean “from and including,” and the words “to,” “until” and “ending on” (and the like) mean “to, and including”;

 

(d)                                 References to a governmental or quasi-governmental agency, authority or instrumentality shall also refer to a regulatory body that succeeds to the functions of the agency, authority or instrumentality;

 

(e)                                  Indications of time of day shall be based upon the time applicable to the location of the principal headquarters of the Company;

 

(f)                                   The words “include,” “includes” and “including” mean “include, without limitation,” “includes, without limitation” and “including, without limitation,” respectively;

 

(g)                                 All references to articles and sections are to articles and sections in the Plan;

 

(h)                                 All words used shall be construed to be of such gender or number as the circumstances and context require;

 

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(i)                                    The captions and headings of articles and sections appearing in the Plan have been inserted solely for convenience of reference and shall not be considered a part of the Plan, nor shall any of them affect the meaning or interpretation of the Plan or any of its provisions;

 

(j)                                    Any reference to an agreement, plan, policy, document or set of documents, and the rights and obligations of the parties under any such agreement, plan, policy, document or set of documents, shall mean such agreement, plan, policy, document or set of documents as amended from time to time, and any and all modifications, extensions, renewals, substitutions or replacements thereof; and

 

(k)                                 All accounting terms not specifically defined in the Plan shall be construed in accordance with GAAP.

 

16Exhibit 4.4

 

ASSUMPTION OF AND AMENDMENT TO THE

STC BANCSHARES CORP. 2016 EQUITY INCENTIVE PLAN

 

WHEREAS, STC Bancshares Corp. (“STC”) previously adopted and currently maintains the STC Bancshares Corp. 2016 Equity Incentive Plan (the “Plan”);

 

WHEREAS, on June 5, 2019, STC entered into an Agreement and Plan of Merger by and among STC, Wintrust Financial Corporation (“Wintrust”) and WTFC STCBC Merger Sub LLC (“Merger Co.”), amended as of July 1, 2019, pursuant to which STC will merge with and into Merger Co. (the “Merger”, and such agreement the “Merger Agreement”), and as a result of which Merger Co. will survive as a wholly-owned subsidiary of Wintrust;

 

WHEREAS, in connection with the Merger, Wintrust desires to assume any outstanding options granted under the Plan and to assume the Plan for purposes of granting awards to certain employees of STC who continue their employment with Merger Co. or commence employment with Wintrust subsequent to the Merger; and

 

WHEREAS, in connection with Wintrust’s assumption of the Plan and outstanding options granted under the Plan, the Company desires to amend the Plan to conform the Plan to the Company’s administrative practices with respect to the administration of equity plans.

 

NOW THEREFORE, Wintrust does hereby assume the Plan and all outstanding options granted under the Plan, effective as of the Effective Time (as defined in the Merger Agreement); and

 

PROVIDED FURTHER, that pursuant to the power of amendment contained in Section 6.1 of the Plan, the Plan is hereby amended, effective as of the Effective Time, by inserting a new Article of the Plan, titled “Assumption of the Plan by Wintrust Financial Corporation” as Article 10 of the Plan as follows:

 

Article 10

ASSUMPTION OF PLAN BY WINTRUST FINANCIAL CORPORATION

 

Section 10.1                            Acquisition of the Company by Wintrust Financial Corporation. On October 7, 2019, WTFC STCBC Merger Sub LLC (“Merger Co.”), a wholly-owned subsidiary of Wintrust Financial Corporation (“Wintrust”), was merged with and into the Company, with Merger Co. surviving as a wholly-owned subsidiary of Wintrust (the “Merger”). In connection with the Merger, Wintrust assumed outstanding options granted under the Plan and assumed the Plan for purposes of granting awards to certain employees of the Company who continue their employment with Merger Co. or Wintrust subsequent to the Merger.

 

Section 10.2                            Conformance to Wintrust’s Administrative Practices. Notwithstanding anything in this Plan to the contrary, effective as of October 7, 2019, the following provisions shall apply: (i) all references in the Plan to “STC Bancshares Corp.” or the “Company” shall be understood to mean Wintrust or any successor thereto; (ii) the Compensation Committee of Wintrust’s Board of Directors shall succeed to the authority of the Board and Committee with respect to the administration of the Plan; (iii) all references in the Plan to a number of Shares shall be deemed to refer to a number of shares of common stock, no par value, of Wintrust (“Wintrust Common Stock”)

 

 

determined by multiplying the number of referenced Shares by the Option Exchange Ratio, as determined under the Agreement and Plan of Merger by and among Wintrust, the Company, and Merger Co., dated as of June 5, 2019 and amended as of July 1, 2019 (the “Merger Agreement”), and rounding down to the nearest whole Share; (iv) the exercise price for one Share under each outstanding stock option agreement shall be equal to the quotient obtained by dividing (1) the exercise price for one Share under the original stock option agreement by (2) the Option Exchange Ratio (as defined in the Merger Agreement) and rounding up to the nearest whole cent; (v) all administrative authority with respect to the Plan shall be delegated in a manner consistent with the delegation provisions of the Wintrust Financial Corporation 2015 Stock Incentive Plan; (vi) all awards granted under this Plan shall be administered in accordance with the administrative policies and procedures in effect from time to time under the Wintrust Financial Corporation 2015 Stock Incentive Plan; provided that awards outstanding under this Plan as of October 7, 2019 shall be deemed amended only to the extent that the amendment does not cause the terms and conditions of such awards to be less favorable to the holders of such awards than the terms and conditions of such awards as in effect immediately prior to October 7, 2019; (vii) tax withholding with respect to all awards granted under this Plan shall be implemented in a similar manner as is provided for under the tax withholding provisions of the Wintrust Financial Corporation 2015 Stock Incentive Plan and the option agreements thereunder; and (viii) all notices to be made to Wintrust pursuant to this Plan shall be sent to Kathleen M. Boege or such other person as designated by the Committee.

 

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IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized agent on this 7th day of October, 2019.

 

	
 
    	
 
    	
WINTRUST   FINANCIAL CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   David A. Dykstra
    
	
 
    	
 
    	
 
    	
Senior   Executive Vice President and Chief Operating Officer
    

 

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