Document:

exhibit10-19_122309.htm

    Exhibit 10.19

       

      CHANGE IN
CONTROL AGREEMENT

       

       
This CHANGE IN CONTROL AGREEMENT (the “Agreement”) is made and entered into as
of the 23rd day of December, 2009 by and between CITIZENS FINANCIAL BANK
(the “Bank”), a federally chartered savings bank, and DANIEL J. ZIMMER (the
“Executive”), who is currently a resident of the State of Illinois.

       

      R E C I T
A L S:

       

        
WHEREAS, the
Executive is presently employed as a senior executive officer of the Bank;
and

       

      WHEREAS,
in the event that the Bank or CFS Bancorp, Inc. (the “Company”), which is
the parent company for the Bank, desires to consider, or is confronted with, the
possibility of a
transaction that could result in a change in control of either the Company or
the Bank, the Board of Directors of the Bank believes that such a transaction
could be a distraction to the Executive and could cause the Executive to
consider alternative employment opportunities; and

       

      WHEREAS,
the Bank also believes that, in the event of a possible change in control
transaction, continuity and input of the Bank’s management will be essential to
the ability of the respective Boards of Directors of the Company and the Bank to
evaluate such a transaction in the best interests of their respective
shareholders; and

       

      WHEREAS,
the Board of Directors of the Bank has determined that it is in the best
interests of the Bank to assure that the Bank will have the continued
dedication, objectivity and service of the Executive in the event of the
possibility, threat or occurrence of such a change in control transaction;
and

       

      WHEREAS,
the Board of Directors of the Bank further believes that it is in the best
interests of the Bank to provide the Executive with change in control payments
under certain circumstances following a change in control transaction and to
have the Bank receive and have the benefit of certain covenants from the
Executive relating to, among other matters, non-disclosure of confidential
information, non-competition and non-solicitation.

       

         NOW,
THEREFORE, in consideration of the foregoing recitals, the respective
covenants, agreements and obligations contained herein, and the continued
employment of the Executive by the Bank, the Bank and the Executive hereby agree
as follows:

       

         Section
1.         Defined
Terms.  The following terms shall have the meanings set forth
below for purposes of this Agreement:

       

        (a)     Average Base
Salary.  The Executive’s “Average Base Salary” shall mean the
average of the Executive’s annual base salary (excluding bonuses, incentive
compensation and any other compensation or amounts) paid in the three (3)
complete fiscal years preceding the Executive’s last day of employment with the
Bank, or in the event that the Executive has been employed by the Bank for less
than three (3) complete fiscal years, then the Average Base Salary shall be
calculated using the Executive’s average monthly base salary based upon the
number of months that the Executive has been employed by the Bank and multiplied
by twelve.

       

         (b)     Cause.  Termination
of the Executive’s employment for “Cause” means the termination of the
Executive’s employment by the Bank because of any of the
following:

       

      
        
          
          

        

        
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      (i)           any
incompetence or intentional failure by the Executive in performing his services
or carrying out his duties and responsibilities for or on behalf of the Bank;
or

       

      (ii)          any
dishonesty, fraud, theft or embezzlement by the Executive;
or

       

      (iii)          any
breach of fiduciary duty or willful misconduct involving personal profit by the
Executive; or

       

      (iv)          any
willful or knowing violation by the Executive of any law, statute, rule,
regulation or government requirement (other than traffic violations or similar
offenses) or any final cease and desist order involving the Executive;
or

       

      (v)           any
material and intentional noncompliance by the Executive with any provision of
any employee handbook, code of conduct or ethics, corporate governance
guidelines or any rule, policy or procedure of the Bank as are currently in
effect or as may hereafter be in effect from time to time;
or

       

      (vi)          any
material breach by the Executive of any provision of this
Agreement.

       

        
(c)     Change in
Control.  “Change in Control” means the occurrence subsequent
to the date of this Agreement of any of the following relating to the Company or
the Bank: (i) an acquisition of control of the Company or the Bank within the
meaning of the Home Owners’ Loan Act of 1933 and 12 C.F. R. 574, as amended;
(ii) an event that would be required to be reported in response to Item 5.01 of
Form 8-K or Item 6(e) of Schedule 14A of Regulation 14A pursuant to the
Securities and Exchange Act of 1934 Act, as amended (“1934 Act”), or any
successor statute, whether or not any class of securities of the Company is
registered under the 1934 Act; (iii) any Person or group of Persons is or
becomes the “beneficial owner” (as defined in Rule 13d-3 under the 1934
Act), directly or indirectly, of securities of either the Company or the Bank
representing 25% or more of the combined voting power of the Company’s or the
Bank’s then outstanding securities; or (iv) during any period of thirty-six
consecutive months, individuals who at the beginning of such period constitute
the Board of Directors of the Company or the Bank cease for any reason to
constitute at least a majority thereof unless the election, or the nomination
for election, of each new director was approved by a vote of at least two-thirds
of the directors then still in office who were directors at the beginning of
such period and, in such case, each new director so approved will be considered
for purposes of this section to have been a director at the beginning of such
period.

       

         For purposes of the definition of “Change
in Control,” (A) a Person or group of Persons does not include the CFS Bancorp,
Inc. Employee Stock Ownership Plan Trust which forms a part of the CFS Bancorp,
Inc. Employee Stock Ownership Plan (the “ESOP”), any other employee benefit plan
of the Company or the Bank, or any subsidiary or affiliate of the Company or the
Bank, and (B) the outstanding securities of the Company shall include all shares
of common stock owned by the ESOP, whether allocated or unallocated to the
accounts of participants thereunder.

       

         (d)     Disability.  “Disability”
means the termination of the Executive’s employment with the Bank because of any
physical or mental impairment, incapacity or condition of the Executive such
that the Executive is substantially limited, with or without accommodation, in
being able to perform the essential functions of his duties and responsibilities
for or on behalf of the Bank (as reasonably determined by the Bank) for at least
sixty (60) days (whether consecutive or non-consecutive days) during any twelve
(12) month period.  A Disability may, but is not required to, be
evidenced by a signed, written opinion of an independent, qualified medical
doctor selected by the Board of Directors or the Chief Executive Officer of the
Bank and paid for by the Bank.  The Executive hereby agrees to make
himself promptly available

      
        
          
          

        

        
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      for examination by such medical doctor upon reasonable
request by the Board of Directors or the Chief Executive Officer of the Bank and
consents to provide promptly the results of such examination and any diagnosis
to the Bank.  Nothing in this Section is intended to be in violation
of the Americans with Disabilities Act.

       

         (e)     Executive
Officers.  “Executive Officers” shall mean those employees of
the Bank who hold the title of Senior Vice President or
above.

       

         (f)     Good
Reason.  “Good Reason” means the occurrence of any of the
following events:

       

      (i)           a
material reduction by the Bank, without the Executive’s written consent, in the
Executive’s duties, responsibilities or authority concurrently with, or during
the two (2) year period immediately following, a Change in Control as compared
to that in effect on the day immediately preceding the Change in Control;
provided, however, that a temporary reduction in the Executive’s duties,
responsibilities or authority during any period that the Executive is on
vacation, using paid time off or on leave of absence in accordance with the
policies and procedures of the Bank shall not constitute a diminution of his
duties, responsibilities and authority; and provided further, however, that
layoffs or terminations following a Change in Control of employees who directly
report to the Executive shall not constitute a diminution of his duties,
responsibilities and authority; or

       

      (ii)           a
material diminution by the Bank, without the Executive’s written consent, in the
Executive’s job title(s) concurrently with, or during the two (2) year period
immediately following, a Change in Control as compared to the Executive’s job
title(s) held on the day immediately preceding the Change in Control;
or

       

      (iii)          a
material reduction by the Bank, without the Executive’s written consent, of his
annual base salary concurrently with, or during the two (2) year period
immediately following, a Change in Control as compared to his annual base salary
in effect on the day immediately preceding the Change in Control; provided,
however, that any reduction by the Bank in the Executive’s annual base salary
concurrently with or following a Change in Control shall not constitute Good
Reason so long as a majority of
all Executive Officers shall also receive a reduction in their respective annual
base salaries as part of across-the-board salary reductions at the Bank and,
further, so long as the percentage reduction in the
Executive’s annual base salary shall not be greater than the average of the
percentage reductions in the annual base salaries of all other Executive
Officers as a group; or

       

      (iv)          a
requirement by the Bank, without the Executive’s written consent, that the
Executive perform his principal job duties and responsibilities concurrently
with, or during the two (2) year period immediately following, a Change in
Control at a location that is more than thirty (30) miles from the location at
which the Executive performs his principal job duties and responsibilities on
the day immediately preceding the Change in Control; or

       

      (v)           any
failure by the Bank to obtain the express written assumption of this Agreement,
and the obligations hereunder, by the successor to the Bank concurrently with a
Change in Control.

       

        The Executive must notify the Bank in writing
within sixty (60) days of the initial existence of the circumstances giving rise
to a termination of the Executive’s employment hereunder for Good
Reason.  The Bank shall then have thirty (30) days following the
effectiveness of such notice during which it may cure such circumstances and, if
so cured, shall not be required to make any change in control payments
hereunder.

       

      
        
          
          

        

        
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(g)     Person.  “Person”
means any natural person, proprietorship, partnership, corporation, limited
liability company, organization, firm, business, joint venture, association,
trust or other entity and any government agency, body or authority.

       

         Section 2.         Term;
Employment Status; Compensation.

       

         (a)     Term of
Agreement.  The initial term of this Agreement shall be for a
period of one (1) year commencing as of the date hereof.  Within
sixty (60) days prior to the first anniversary of the date of this Agreement and
within sixty (60) days prior to each subsequent one (1) year anniversary
thereafter, the Board of Directors of the Bank shall review this Agreement and
determine whether the term of this Agreement shall be extended for a period of
one (1) year in addition to the then-remaining term.  The Board of
Directors shall promptly notify the Executive in writing as to whether it has
determined to extend further the term of this Agreement.  If the Board
of Directors determines not to extend further the term of this Agreement, then
this Agreement shall terminate and be of no further force or effect, except as
expressly set forth herein, at the end of the then-existing term, and the
Executive’s employment with the Bank shall continue to be on an employee-at-will
basis.  Reference herein to the term of this Agreement shall refer to
both such initial term and any extended terms.

       

        As part of the review by the Board of Directors
of the Bank on at least an annual basis whether to permit extensions of the term
of this Agreement, the Board shall consider all factors that it deems relevant,
including without limitation the Bank’s continued need for this Agreement and
the covenants of the Executive herein.

       

         If the Board of Directors of the Bank
provides written notice to the Executive that the term of this Agreement shall
not be further extended, such event shall not, in and of itself, constitute Good
Reason or a termination of the Executive’s employment by the Bank.  In
the event of a termination of the Executive’s employment by either the Bank or
the Executive prior to the occurrence of a Change in Control or in the event
that the term of this Agreement shall have expired after the Bank has provided
notice that the term shall not be extended, then no change in control payments
shall be payable to the Executive hereunder, but Sections 3(c)(iv), 4,
5(a), 5(b), 5(d), 5(e), 5(f), 5(g), 6, 7 and 8 hereof shall survive such
termination of employment or expiration of the term of this Agreement, as the
case may be, and shall continue in full force and effect and be binding upon the
Executive.

       

         (b)     Employment
Status.  This Agreement is not and shall not be construed to be
an employment agreement or a guarantee or commitment for continued employment of
the Executive by the Bank.  The Executive is and shall at all times be
an employee-at-will of the Bank and shall be considered an “exempt employee” for
purposes of the Fair Labor Standards Act.  The Executive is employed
by the Bank and not the Company.  Neither this Agreement nor anything
contained herein shall be construed as affecting or limiting the right of the
Bank or the Executive to terminate the Executive’s employment with the Bank at
any time for any reason or for no reason.  The Executive understands
and agrees that the change in control payments provided in this Agreement are in
lieu of any change in control benefits that may otherwise be payable to the
Executive under any severance pay policies or practices of the Company or the
Bank, and the Executive hereby waives, and shall not be entitled to, any
payments or benefits under any such severance pay policies or
practices.

       

         (c)     Compensation.  All
matters relating to the employment of the Executive by the Bank (including, but
not limited to, base salary; bonuses; equity or other incentive compensation;
employee benefits; retirement; profit sharing; health, life, disability and
other insurance; expense reimbursement; and vacation, sick and other paid time
off, and including the cost and eligibility requirements thereof;
and

      
        
          
          

        

        
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      the termination of the Executive’s employment) shall
be subject to the plans, programs, employee handbooks, rules, policies and
procedures of the Bank as are currently in effect or as may hereafter be
established, amended or in effect from time to time.

       

         Section
3.         Termination
of Employment and Payments Following a Change in
Control.

       

         (a)     Termination
of Employment Following a Change in Control.  Upon the
occurrence of either of the following events during the term of this Agreement,
the Executive shall receive the amounts specified in Section 3(b)
below:

       

      (i)         
the Executive has terminated his employment with the Bank for Good Reason
concurrently with, or during the two (2) year period immediately following, a
Change in Control; or

       

      (ii)         the
Bank has terminated the employment of the Executive concurrently with, or during
the two (2) year period immediately following, a Change in Control for any
reason other than for Cause or a Disability of the
Executive.

       

          (b)    Payments
to the Executive Following a Change in Control.  Subject to
Sections 3(c) and 3(d), the Bank shall pay to the Executive the amounts set
forth below if either of the events described above in Section 3(a) have
occurred:

       

      (i)           Change in
Control Payments.  Change in control payments equal to the
Executive’s Average Base Salary (calculated as a monthly amount) for a period of
twelve (12) months following the Executive’s last day of employment with the
Bank.  Each payment shall be treated as a separate payment for
purposes of Section 409A of the Internal Revenue Code of 1986, as
amended.  The foregoing monthly change in control payments shall be
paid beginning on the last day of the month following the month in which the
Executive’s last day of employment with the Bank occurs and on the last day of
each subsequent month thereafter until all change in control payments have been
paid.

       

      (ii)           Retirement
Plans.  All amounts that are fully earned and vested and
properly payable on or before the Executive’s last day of employment under all
retirement plans sponsored by the Company or the Bank in accordance with the
provisions of such plans.

       

      (iii)          Other
Amounts.  All other amounts that are properly payable to the
Executive by the Bank that have not been paid to him on or before his last day
of employment.  Such amounts shall be paid to the Executive in
accordance with the policies, procedures and/or practices of the
Bank.

       

      (iv)          COBRA
Coverage.  If the Executive is participating in the Company’s
or the Bank’s group health insurance plan at the time that his employment with
the Bank is terminated and if the Executive has made an appropriate election to
continue such coverage for himself and/or his spouse and legal dependents under
the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended
(“COBRA”), the Executive shall pay the premiums associated with such
continuation group health coverage and the Bank shall reimburse the Executive
only for the premiums actually paid by him associated with such continuation
coverage until the earlier of (A) the expiration of the period of time that the
Executive has elected to receive continuation coverage under the Company’s or
the Bank’s group health insurance plan pursuant to COBRA (but, in any event, not
to exceed twelve (12) months following his last day of employment with the
Bank), or (B) the date on which the Executive becomes eligible to receive health
insurance benefits from a new employer or another Person.  The
foregoing reimbursement of premiums shall not be paid to the Executive if his
employment with the Bank is terminated by the Bank for
Cause.

       

      
        
          
          

        

        
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         (c)     Certain
Other Matters.  Notwithstanding the foregoing provisions of
this Section 3, the following shall apply:

       

      (i)           The
Executive (and his spouse and heirs) shall not be entitled to any change in
control payments under this Agreement from the Bank in the event of his
death.

       

      (ii)           All
outstanding awards of cash bonuses, stock options, restricted stock and other
incentive compensation (whether cash or equity based) from the Company or the
Bank shall vest or be earned and be paid or distributed to, or be exercisable
by, as the case may be, the Executive in accordance with the applicable plan or
award agreement governing such awards.

       

      (iii)          Upon
any termination of the Executive’s employment, the Executive shall execute (and
not subsequently rescind or revoke) a release substantially similar to the
release attached to this Agreement as Exhibit
A as a condition to the Executive receiving any of the amounts set forth
in this Section 3.

       

      (iv)          At
all times while employed by the Bank and at all times following any termination
of his employment, the Executive shall not make or publish any negative or
disparaging statements or comments of any kind or character whatsoever about the
Company, the Bank, any of their directors, officers, employees or customers or
the business, operations, affairs, profitability, strategies or policies of the
Company or the Bank.

       

      (v)           If
the Executive breaches any provision of this Agreement, whether before or after
any termination of his employment with the Bank, or refuses to execute (or
rescinds or revokes) the release attached to this Agreement as Exhibit
A (or a release substantially similar to the release attached to this
Agreement as Exhibit
A), then the Bank’s obligation to make any change in control payments or
to make any reimbursement for the premiums associated with the COBRA
continuation coverage to the Executive under this Section 3 shall terminate
immediately without reinstatement of any obligation of the Bank to pay or
reimburse, or to resume paying or reimbursing following any cure of a breach,
the Executive hereunder.  Notwithstanding any such termination of the
Bank’s obligation to pay or reimburse, (A) the covenants and agreements set
forth in Sections 3(c)(iv), 4, 5, 6, 7 and 8 hereof shall continue in full
force and effect and be binding upon the Executive, (B) the Bank shall be
entitled to the remedies specified in Section 7 hereof, among others, and
(C) the existence of any claim or cause of action of the Executive against the
Bank, whether predicated on this Agreement or otherwise, shall not constitute a
defense to the enforcement by the Bank of the covenants contained in
Sections 3(c)(iv), 4, 5 or 6.

       

         (d)     Delay of
Payment under Certain Circumstances.  Notwithstanding the
foregoing provisions of this Section, all amounts under this Agreement that (i)
are payable to the Executive due to the Executive’s Separation from Service, as
described in Treasury Regulation §1.409A-1(h), for a reason other than the
Executive’s death, (ii) are payable at a time when the Executive is a “Specified
Employee” as defined in Treasury Regulation §1.409A-1(i), and (iii) provide for
a “deferral of compensation” as defined in Treasury Regulation §1.409A-1(b)
under Sections 6(b) and 6(e), shall be suspended for six (6) months following
such Separation from Service.  The Executive shall receive a lump sum
payment of the amounts so suspended on the first day following the six-month
suspension period, with such lump sum payment being subject to termination as
set forth in Section 3(c) above.

      
        
           

        

        
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         Section
4.         Non-Disclosure;
Return of Confidential Information and Other
Property.

       

        
(a)     Confidential
Information; Non-Disclosure.  At all times while the Executive
is employed by the Bank and at all times following any termination of his
employment, the Executive shall not (i) directly or indirectly disclose, provide
or discuss any Confidential Information with or to any party other than those
directors, officers, employees, representatives and agents of the Company, the
Bank or any of their subsidiaries or affiliates who need to know such
Confidential Information for a proper corporate purpose, and/or (ii) directly or
indirectly use any Confidential Information (A) to compete against the Company,
the Bank or any of their subsidiaries or affiliates, (B) to the detriment of the
Company, the Bank or any of their subsidiaries or affiliates, or (C) for the
Executive’s own benefit or for the benefit of any Person other than the Company,
the Bank or any of their subsidiaries or affiliates.  The Executive
agrees that all Confidential Information is and at all times shall remain the
property of the Company, the Bank or any of their subsidiaries or affiliates, as
applicable.

       

        
For purposes of this Agreement, the term “Confidential Information” means any
and all of the following, whether disclosed to or known by the Executive on,
before or after the date of this Agreement:

       

      (i)      any and all
materials, records, data, documents, lists, information and trade secrets
(whether in writing, printed, verbal, electronic, computerized, imaged, on disk,
CD, DVD or otherwise) (A) relating or referring in any manner to the business,
operations, affairs, financial condition, results of operation, assets,
liabilities, revenues, income, deposits, loans, products, estimates,
projections, budgets, policies, strategies, techniques, methods, vendors,
relationships, customers and/or clients of the Company, the Bank or any of their
subsidiaries or affiliates that are confidential, proprietary or not otherwise
publicly available (other than by or through the Executive or any other
impermissible disclosure), or (B) that the Company or the Bank, or any of their
subsidiaries or affiliates has deemed confidential, proprietary or nonpublic;
and

       

      (ii)      any and all
trade secrets of the Company, the Bank or any of their subsidiaries or
affiliates; and

       

      (iii)     any and all copies,
summaries, analyses, extracts, documents or information (whether prepared by the
Company, the Bank or any of their subsidiaries or affiliates, the Executive or
otherwise) which relate or refer to or reflect any of the items set forth in
this Section 4(a).

       

        Notwithstanding the foregoing, the restrictions
on the use or disclosure of Confidential Information shall not apply to any
information:

       

      (A)     after it has become
generally available to the public without breach of this Agreement by the
Executive, or

       

      (B)     which, at the time of
disclosure by the Executive, was already known to a third party to whom the
disclosure was made without breach of this Agreement by the
Executive.

       

        In the event the Executive receives a request
to disclose all or any part of the Confidential Information under the terms of a
valid and effective subpoena or order issued by a court of competent
jurisdiction, the Executive agrees to

       

      (A)     immediately notify
the Bank of the existence, terms and circumstances surrounding such a request so
that the Bank may consider seeking a protective order or other appropriate
remedy and/or waive compliance with the provisions of this
Agreement,

       

      
        
          
          

        

        
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      (B)     consult with the Bank
on the advisability of taking legally available steps to resist or narrow such
request, and

       

      (C)     if disclosure of such
information is required, exercise his best efforts to obtain an order or other
reliable assurance that confidential treatment will be accorded to such portion
of the information which the Bank so designates.

       

       
(b)     Return of
Confidential Information and Other Property.  The Executive
covenants and agrees (i) to return to the Bank on his last day of employment, at
the Bank’s headquarters, all Confidential Information that is still in the
Executive’s possession or control on his last day of employment with the Bank or
the location of which the Executive knows (including, but not limited to, any
Confidential Information contained on the Executive’s personal digital
assistant, BlackBerry, mobile telephone and personal or home computer), and (ii)
to return to the Bank on his last day of employment, at the Bank’s headquarters,
all vehicles, equipment, computers, personal digital assistants, BlackBerrys,
mobile telephones, credit cards, keys, access cards, passwords and other
property owned or provided by the Company or the Bank that are still in the
Executive’s possession or control on his last day of employment or the location
of which the Executive knows, and to cease using any of the foregoing on and
after his last day of employment.

       

         Section
5.         Non-Competition
and Non-Solicitation.

       

       
(a)     The Executive hereby understands, acknowledges
and agrees that, by virtue of his position at the Bank, he has or will have
advantageous and competitive familiarity and personal contacts with the
customers and clients (wherever located), products, services, strategies and
employees of the Company, the Bank and their subsidiaries and affiliates and has
and will have advantageous and competitive familiarity with the Confidential
Information.  As such, and in view of the highly competitive nature of
the business in which the Bank is or may be engaged, the Executive agrees that
the covenants set forth in Sections 4, 5 and 6 are reasonable and necessary for
the protection of the Bank’s business and the Confidential
Information.

       

        (b)     At all times
while the Executive is employed by the Bank, he shall not engage in or compete
with, or assist another party in engaging in or competing with (or finance,
operate, or control) any banking, financial services or other business,
operation, or activity which is conducted or proposed to be conducted by the
Company, the Bank or any of their subsidiaries or affiliates (or which is in the
same or a similar line of business as, or competes with, the Company, the Bank
or any of their subsidiaries or affiliates), nor shall he shall solicit in any
manner, seek to obtain, service or accept any business for or on behalf of a
party other than the Company, the Bank or their subsidiaries or affiliates
relating to the products or services offered or sold by any of
them.

       

       
(c)     For a period of one (1) year following his last
day of employment with the Bank, the Executive shall not, within a thirty (30)
mile radius of any office of the Bank, directly or indirectly, or individually
or together with any other Person (as owner, shareholder, investor, member,
partner, proprietor, principal, director, officer, employee, manager, agent,
representative, independent contractor, consultant, advisor or otherwise),
engage in any banking, financial services or other business, operation or
activity which is conducted by the Company, the Bank or any of their
subsidiaries or affiliates during such one (1) year period (or which is in the
same or a similar line of business as, or competes with, the Company, the Bank
or any of their subsidiaries or affiliates) or which was conducted, or proposed
to be conducted, or actively being developed or pursued by the Company, the Bank
or any their subsidiaries or affiliates at any time during the one (1) year
period preceding his last day of employment, nor shall the

      
        
          
          

        

        
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      Executive
assist another party in engaging in or competing with (or finance, operate or
control) any banking, financial services or other business, operation, activity
or similar line of business which is conducted, or proposed to be conducted, or
actively being developed or pursued by the Company, the Bank or any of their
subsidiaries or affiliates on the Executive’s last day of employment with the
Bank, or which was conducted, or proposed to be conducted, or actively being
developed or pursued by the Company, the Bank or any their subsidiaries or
affiliates at any time during the one (1) year period preceding his last day of
employment.

       

       
(d)     For a period of one (1) year following his last
day of employment with the Bank, the Executive shall not, directly or
indirectly, or individually or together with any other Person, as owner,
shareholder, investor, member, partner, proprietor, principal, director,
officer, employee, manager, agent, representative, independent contractor,
consultant, advisor or otherwise:

       

      (i)           solicit
in any manner, seek to obtain, service or accept any business of any Person who
is a customer or client of the Company, the Bank or any of their subsidiaries or
affiliates relating to products or services offered, or actively being
developed, by any of them on the Executive’s last day of employment with the
Bank or who was an existing or prospective customer or client of the Company,
the Bank or any of their subsidiaries or affiliates at any time during the one
(1) year period preceding the Executive’s last day of employment;
or

       

      (ii)           contact,
or conduct, authorize or approve any advertisement or communication to, any
customer or client of the Company, the Bank or any of their subsidiaries or
affiliates (A) for purposes of announcing his employment or affiliation with
another Person, or (B) in connection with directly or indirectly engaging in any
banking, financial services or other business or activity in competition with
the business, affairs or interests of (or which is in the same or a similar line
of business as) the Company, the Bank or any of their subsidiaries or
affiliates; or

       

      (iii)          offer
or provide employment, hire or engage (whether on a full-time, part-time, or
consulting basis or otherwise) any individual who is an employee of the Company,
the Bank or any of their subsidiaries or affiliates on the last day of the
Executive’s employment with the Bank or who was such an employee at any time
during the one (1) year period preceding the Executive’s last day of employment,
nor shall the Executive request or attempt to influence any person who is
employed by the Company, the Bank or any of their subsidiaries or affiliates on
the Executive’s last day of employment to terminate such employee’s employment
with the Company, the Bank or any of their subsidiaries or affiliates;
or

       

      (iv)           request,
encourage or advise any Person who is a customer, client, vendor or otherwise
doing business or having a relationship with the Company, the Bank or any of
their subsidiaries or affiliates on the Executive’s last day of employment to
terminate, reduce, limit or change their business or relationship with the
Company, the Bank or any of their subsidiaries or
affiliates.

       

        (e)      The Executive
acknowledges the geographic scope of the business of the Company, the Bank and
their subsidiaries or affiliates.  Nevertheless, in the event that any
provision of Section 5(c) or Section 5(d) is found by a court of competent
jurisdiction to exceed the geographic, time or other restrictions permitted by
applicable law, then the court shall have the power to reduce, limit or reform
(but not to increase or make greater) such provision to make it enforceable to
the maximum extent permitted by law, and such provision shall then be
enforceable against the Executive in its reduced, limited or reformed
manner.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

        
(f)     The Bank and the Executive agree that the
provisions of this Section 5 shall be severable in accordance with Section 8(e)
hereof.

       

         (g)    The
restrictions and covenants contained in this Section 5 shall be deemed not to
run during all periods of noncompliance, with the intention of the parties being
to have such restrictions and covenants apply during the full periods specified
in this Section.

       

         Section 6.         Intellectual
Property.  The Executive understands, acknowledges, and agrees
that each and every invention, idea, concept, discovery, improvement, device,
design, drawing, sketch, specification, prototype, sample, practice, process,
method, technique or product (whether in written or electronic format and
whether or not patentable, copyrightable or registerable for trademark
protection) made, created, developed, perfected, devised, conceived, worked on
or first reduced to practice by the Executive, either solely or in collaboration
with others, during the period of the Executive’s employment with the Bank
(whether or not during regular working hours) relating, directly or indirectly,
to the business, operations, affairs, products, practices, techniques or methods
of the Company, the Bank or any their subsidiaries or affiliates (the
“Intellectual Property”) is and shall be the exclusive property of the Company,
the Bank or any of their subsidiaries or affiliates, as
applicable.  The Executive hereby forever, unconditionally and
irrevocably releases and relinquishes any and all right, title and interest that
he may have in and to the Intellectual Property worldwide and hereby forever,
unconditionally and irrevocably assigns to the Company, the Bank or any of their
subsidiaries or affiliates any and all of the Executive’s right, title and
interest in and to the Intellectual Property worldwide.  At the
request and expense of the Company, the Bank or any of their subsidiaries or
affiliates, the Executive shall (a) execute any and all assignments, documents
and other writings that the Company, the Bank or any of their subsidiaries or
affiliates determines are necessary to evidence ownership of the Intellectual
Property in the Company, the Bank or any of their subsidiaries or affiliates,
(b) execute any and all applications and registrations of the Company, the Bank
or any of their subsidiaries or affiliates for patents, trademarks and/or
copyrights relating to the Intellectual Property, and (c) assist the Company,
the Bank or any of their subsidiaries or affiliates in obtaining any and all
patents, trademarks and copyrights that it desires relating to the Intellectual
Property.

       

         Section
7.         Certain
Remedies.  The Executive understands and agrees that the
Company or the Bank will suffer irreparable damage and injury and will not have
an adequate remedy at law in the event of any actual, threatened, or attempted
breach by the Executive of any provision of Section 3(c)(iv), 4, 5 or
6.  Accordingly, in the event of a breach or a threatened or attempted
breach by the Executive of any provision of Section 3(c)(iv), 4, 5 or 6, in
addition to all other remedies to which the Company or the Bank is entitled at
law, in equity or otherwise, the Company or the Bank shall be entitled to seek a
temporary restraining order, a permanent or temporary injunction and/or a decree
of specific performance of any provision of Section 3(c)(iv), 4, 5 or
6.  In addition, in the event of any breach by the Executive of any
provision of Section 3(c)(iv), 4, 5 or 6, the Executive shall immediately repay
to the Bank all change in control payments already paid to him under Section 3
hereof following his last day of employment, plus interest thereon at 8% per
annum until repaid in full and the Bank’s cost of collection and reasonable
attorneys fees.  The parties agree that a bond posted by the Bank in
the amount of One Thousand Dollars ($1,000) shall be adequate and appropriate in
connection with such restraining order or injunction and that actual damages
need not be proved by the Bank prior to it being entitled to obtain such
restraining order, injunction or specific performance.  The foregoing
remedies shall not be deemed to be the exclusive rights or remedies of the Bank
for any breach of or noncompliance with this Agreement by the Executive but
shall be in addition to all other rights and remedies available to the Bank at
law, in equity, or otherwise.

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

         Section
8.         Miscellaneous.

       

        
(a)     Binding
Effect; Assignment.  This Agreement shall be binding upon and
inure to the benefit of the Bank and the Executive and their respective heirs,
executors, representatives, successors and assigns; provided, however that the
Executive may not assign this Agreement, and his rights and obligations
hereunder, without the prior written consent of the Bank.  The Bank
may, without the consent of the Executive, assign this Agreement, and its rights
and obligations hereunder, to (i) the Company or any of its subsidiaries or
affiliates, or (ii) any successor of the Company or the Bank or any other third
party in connection with any recapitalization, reorganization or Change in
Control.  In the event of any such permitted assignment of this
Agreement, all references to the “Bank” shall thereafter mean and refer to the
assignee of the Bank.

       

        
(b)     Waiver.  A
waiver by either party must be in writing signed by the party entitled to grant
such a waiver.  The waiver by a party of a breach of or noncompliance
with any provision of this Agreement shall not operate or be construed as a
continuing waiver or a waiver of any other or subsequent breach or noncompliance
hereunder.  The failure or delay of either party at any time to insist
upon the strict performance of any provision of this Agreement or to enforce its
or his rights or remedies under this Agreement shall not be construed as a
waiver or relinquishment of the right to insist upon strict performance of such
provision, or to pursue any of its rights or remedies for any breach hereof, at
a future time.

       

        
(c)     Amendment.  This
Agreement may be amended or modified only by a written agreement executed by
both parties hereto.

       

        
(d)     Headings.  The
headings in this Agreement have been inserted solely for ease of reference and
shall not be considered in the interpretation or construction of this
Agreement.

       

        
(e)     Severability.  In
case any one or more of the provisions (or any portion thereof) contained herein
shall, for any reason, be held to be invalid, illegal, or unenforceable in any
respect, such invalidity, illegality, or unenforceability shall not affect any
other provision of this Agreement, but this Agreement shall be construed as if
such invalid, illegal, or unenforceable provision or provisions (or portion
thereof) had never been contained herein; provided, however, if any provision of
Section 5 of this Agreement shall be determined by a court of competent
jurisdiction to be unenforceable because of the provision’s scope, duration,
geographic restriction, or other factor, then such provision shall be considered
divisible and the court making such determination shall have the power to reduce
or limit (but not increase or make greater) such scope, duration, geographic
restriction, or other factor or to reform (but not increase or make greater)
such provision to make it enforceable to the maximum extent permitted by law,
and such provision shall then be enforceable against the appropriate party
hereto in its reformed, reduced, or limited form.

       

        
(f)     Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but such counterparts shall together constitute one and the same
agreement.

       

         (g)     Voluntary
Execution; Construction.  The Executive agrees that he has
executed this Agreement voluntarily and not as a condition to continued
employment with the Bank.  This Agreement shall be deemed to have been
drafted by both of the parties hereto.  This Agreement shall be
construed in accordance with the fair meaning of its provisions and its language
shall not be strictly construed against, nor shall ambiguities be resolved
against, either party.  THE EXECUTIVE
HEREBY UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT HE HAS NOT RECEIVED ANY ADVICE,
COUNSEL OR RECOMMENDATION WITH RESPECT TO THIS
AGREEMENT 

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      FROM THE BANK, ANY
DIRECTOR, OFFICER OR EMPLOYEE OF THE BANK OR ANY ATTORNEY, ACCOUNTANT OR ADVISOR
FOR THE BANK.

       

        
(h)     Entire
Agreement.  This Agreement constitutes the entire understanding
and agreement between the parties hereto (and supersedes all other prior
understandings, commitments, representations, negotiations, and agreements)
relating to the subject matter hereof.

       

        
(i)     Governing
Law; Venue; Waiver of Jury Trial.  This Agreement shall be
governed by and construed in accordance with the laws of the State of Indiana,
without reference to any choice of law provisions, principles, or rules thereof
(whether of the State of Indiana or any other jurisdiction) that would cause the
application of any laws of any jurisdiction other than the State of
Indiana.  Any claim, demand, or action relating to this Agreement
shall be brought only in a federal or state court of competent jurisdiction in
Lake County, Indiana.  In connection with the foregoing, the parties
hereto irrevocably consent to the jurisdiction and venue of such court and
expressly waive any claims or defenses of lack of jurisdiction of or proper
venue by such court.  THE BANK AND THE EXECUTIVE HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVE TO THE MAXIMUM EXTENT PERMITTED BY LAW ANY AND ALL
RIGHT TO A TRIAL BY JURY IN ANY DEMAND, CLAIM, ACTION, SUIT, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR OTHERWISE RELATING TO THIS
AGREEMENT.

       

         (j)     Notices.  All
notices and other communications under this Agreement shall be in writing and
given by hand delivery, mail, overnight delivery or facsimile transmission and
shall be deemed to have been duly given (i) upon delivery by hand (in the Bank’s
case, to its Chief Executive Officer); (ii) two (2) business days after deposit
in regular United States Mail, first class postage pre-paid (not certified or
registered mail); (iii) on the next business day after deposit with a nationally
recognized overnight delivery service; or (iv) on the date indicated on the fax
confirmation page.  All notices and other communications shall be
addressed as follows: if to the Bank, c/o its Chief Executive Officer at its
corporate headquarters; and if to the Executive, to his address reflected on the
employment records of the Bank; or to such other address as any party hereto may
have furnished to the others in writing in accordance
herewith.

       

        
(k)    Recitals.  The
recitals or “Whereas” clauses contained on page 1 of this Agreement are
expressly incorporated into and made a part of this Agreement.

       

         (l)     Taxes.  All
taxes (other than the Bank’s portion of any FICA or other employment taxes, if
applicable) on the change in control payments and all other amounts under this
Agreement shall be the responsibility of and paid by the
Executive.  The Bank shall be entitled to withhold from such change in
control payments and other amounts (i) applicable income, FICA, employment and
other taxes, and (ii) other appropriate and customary amounts in accordance with
the Bank’s established practices in effect from time to
time.

       

         (m)   Payment
of Attorneys Fees.  In the event any dispute, claim or
litigation arising under or in connection with this Agreement is resolved in
favor of the Executive, whether by judgment, arbitration or settlement, the
Executive shall be entitled to the payment of all reasonable attorneys fees
incurred by him in resolving such dispute, claim or
litigation.

       

         (n)    Regulatory
Matters.  Notwithstanding any other provision of this Agreement
to the contrary, the following provisions shall be applicable to the Bank and
the Executive only if and to the extent that they are required to be included in
agreements relating to compensation arrangements between a savings association
and its employees pursuant to applicable law or regulation, and shall be
controlling

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      in the event of a conflict with any other provision of
this Agreement, including without limitation Section 3
hereof:

       

      (i)           any
payments made to the Executive pursuant to this Agreement, or otherwise, are
subject to and conditioned upon their compliance with Section 18(k) of the
Federal Deposit Insurance Act (12 U.S.C. §1828(k)) and the regulations
promulgated thereunder, including 12 C.F.R. Part 359;

       

      (ii)           If
the Executive is suspended from office and/or temporarily prohibited from
participating in the conduct of the Bank’s affairs pursuant to notice served
under Section 8(e)(3) or Section 8(g)(1) of the Federal Deposit Insurance Act
(“FDIA”) (12 U.S.C. §§1818(e)(3) and 1818(g)(1)), the Bank’s obligations under
this Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings.  If the charges in the notice are dismissed,
the Bank may, in its discretion (A) pay the Executive all or part of the
compensation withheld while its obligations under this Agreement were suspended,
and (B) reinstate (in whole or in part) any of its obligations which were
suspended;

       

      (iii)          If
the Executive is removed from office and/or permanently prohibited from
participating in the conduct of the Bank’s affairs by an order issued under
Section 8(e)(4) or Section 8(g)(1) of the FDIA (12 U.S.C. §§1818(e)(4) and
(g)(1)), all obligations of the Bank under this Agreement shall terminate as of
the effective date of the order, but vested rights of the Executive and the Bank
as of the date of termination shall not be affected;

       

      (iv)          If
the Bank is in default, as defined in Section 3(x)(1) of the FDIA (12 U.S.C.
§1813(x)(1)), all obligations under this Agreement shall terminate as of the
date of default, but vested rights of the Executive and the Bank as of the date
of termination shall not be affected; and

       

      (v)           All
obligations under this Agreement shall be terminated pursuant to 12 C.F.R.
§563.39(b)(5) (except to the extent that it is determined that continuation of
the Agreement for the continued operation of the Bank is necessary) (A) by the
Director of the Office of Thrift Supervision (“OTS”), or his/her designee, at
the time the Federal Deposit Insurance Corporation enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) of the FDIA (12 U.S.C. §1823(c)), or (B) by the Director of the
OTS, or his/her designee, at the time the Director, or his/her designee,
approves a supervisory merger to resolve problems related to operation of the
Bank or when the Bank is determined by the Director of the OTS to be in an
unsafe or unsound condition.  Notwithstanding the foregoing, vested
rights of the Executive and the Bank as of the date of termination shall not be
affected.

       

       

       

       

       

      [SIGNATURE
PAGE FOLLOWS THIS PAGE]

       

       

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

       

        
IN WITNESS WHEREOF, the Bank and the Executive have entered into,
executed and delivered this Agreement as of the day and year first above
written.

       

       

       

       

                         /s/ Daniel J.
Zimmer                     

       Daniel J. Zimmer

       

       

      CITIZENS FINANCIAL BANK

       

       

       

      By:  /s/ Monica F.
Sullivan                               

       

      Printed:  Monica F.
Sullivan                                               

       

      Its:  Corporate Secretary                                

       

       

       

       

       

       

       

      
        	
                 
      

              	
                KD_2404365_2.DOC

              

      

       

       

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

       

       

      EXHIBIT
A

       

       

      RELEASE
OF CLAIMS

       

       

      1.           In
consideration of the execution by Citizens Financial Bank (the “Bank”) of that
certain Change in Control Agreement (the “Agreement”) dated December
___________, 2009 by and between the Bank and the undersigned, Daniel J. Zimmer
(the “Executive”), and for other good and valuable consideration, the Executive
hereby irrevocably, unconditionally, and forever releases, waives, discharges
and covenants not to sue or make any claim against CFS Bancorp, Inc. (the
“Company”), the Bank, each of their subsidiaries and affiliates, the Company’s
and the Bank’s respective predecessors and successors, their respective former,
present and/or future shareholders, members, owners, directors, officers,
employees, managers, fiduciaries, administrators, insurers, attorneys,
representatives and agents, and all persons acting by, through, under or in
concert with any of them (collectively, the “Released Parties”) for or from any
and all complaints, claims, demands, liabilities, obligations, actions, rights
of actions and proceedings of any nature whatsoever (including, but not limited
to, claims for damages, attorneys fees, interest and costs), whether
administrative or judicial, known or unknown, suspected or unsuspected, matured
or unmatured, or otherwise, that exist as of (or existed prior to) the date that
the Executive signs this Release.  Without limiting the generality of
the foregoing, the Executive understands and agrees that this Release includes
and constitutes a complete waiver and release by the Executive in all capacities
(including, but not limited to, as a shareholder, officer, employee, individual
or otherwise), and by his heirs, executors, administrators, representatives, and
assigns, of any and all possible claims against each of the Released Parties
based upon, arising out of or in any manner related to any salary, commission,
bonuses (discretionary or otherwise) and other compensation from the Company,
the Bank or any of their subsidiaries or affiliates; any plan, policy, program
or promise of compensation from any of the Released Parties; any award of stock
options, restricted stock or other equity-based or incentive compensation from
the Company or the Bank; the Executive’s employment with or termination of
employment by the Bank; wrongful termination or discharge; breach of contract;
breach of good faith or fair dealing; infliction of emotional distress; and
discrimination based on age, race, sex, religion, national origin, disability,
veterans status, sexual orientation, gender identity, or any other claim of
employment discrimination, including, but not limited to, claims arising under
the following laws and amendments thereto, if any:  the Civil Rights
Act of 1866 (42 U.S.C. § 1981), Title VII of the Civil Rights Act of 1964, the
Americans with Disabilities Act, the Age Discrimination in Employment Act of
1967, the Federal Rehabilitation Act of 1973, the Family and Medical Leave Act,
the Fair Labor Standards Act, the Older Workers Benefit Protection Act, the
Employee Retirement Income Security Act of 1974; any other federal or state
employment law; any federal or state wage and hour laws, and all other similar
federal, state or local laws, statutes, rules or regulations; and, in addition,
all other tort or contract claims and other theories of
recovery.  Notwithstanding the foregoing, this Release does not
affect, release or waive any of the Executive’s claims for change in control
payments under the Agreement or claims for benefits or payments under any
employee benefit plan of the Company or the Bank in accordance with the
provisions of any such plan.

       

      2.           This
Release shall be construed as broadly and comprehensively as applicable law
permits; provided, however, that this Release shall not be construed as
releasing or waiving any right that, as a matter of law, cannot be released or
waived, including but not limited to any right to file a charge or participate
in an investigation or proceeding conducted by the U.S. Equal Employment
Opportunity Commission.  Notwithstanding the foregoing, the Executive
waives any right to recover monetary remedies in his own behalf in any such
investigation or proceeding.

       

      3.           The
Executive acknowledges that the Bank has advised him to consult with an attorney
of the Executive’s own choice prior to signing this Release and that he has had
ample time and adequate opportunity to discuss thoroughly all aspects of this
Release with his attorney.

       

      
        
          
          

        

        
          A-1

          
            

          

        

        
          
          

        

      

      4.           In
the event the Executive is forty (40) years of age or older, the Executive
acknowledges that the Bank has advised him that he has a period of twenty-one
(21) days to review and consider this Release.  The Executive
understands that he may use as much or all of the twenty-one (21) day period as
the Executive desires prior to signing this Release.  Upon execution
of this Release, the Executive waives any remaining portion of the twenty-one
(21) day review period.

       

      5.           In
the event the Executive is forty (40) years of age or older, the Executive
acknowledges that the Bank has advised him that he may revoke this Release
within seven (7) days after signing it.

       

      ANY
SUCH REVOCATION MUST BE IN WRITING AND RECEIVED BY THE BANK AT THE FOLLOWING
ADDRESS NOT LATER THAN 5:00 P.M. (MUNSTER, INDIANA TIME) ON THE SEVENTH (7TH) DAY
FOLLOWING THE DATE OF EXECUTION OF THIS RELEASE:

       

      Attn:  Chief
Executive Officer

      Citizens
Financial Bank

      707
Ridge Road

      Munster,
Indiana 46321

       

      6.           All
provisions of this Release are severable from one another.  In case
any one or more of the provisions (or any portion thereof) contained in this
Release shall, for any reason, be held to be invalid, illegal, or unenforceable
in any respect, such invalidity, illegality, or unenforceability shall not
affect any other provision of this Release, but this Release shall be construed
as if such invalid, illegal, or unenforceable provision or provisions (or
portion thereof) had never been contained herein.  This Release shall
be governed by and construed in accordance with the laws of the State of
Indiana, without reference to any choice of law provisions, principles, or rules
thereof (whether of the State of Indiana or any other jurisdiction) that would
cause the application of any laws of any jurisdiction other than the State of
Indiana.  This Release may not be assigned, terminated or amended
without the prior written consent of the Bank (by its Chief Executive
Officer).  This Release may be executed in any number of counterparts,
each of which shall be an original, but such counterparts shall together
constitute one and the same document.

       

      IN
WITNESS WHEREOF, the undersigned has executed this Release of Claims as of the
date indicated below.

       

       

      ____________________________________

       Daniel J. Zimmer

       

      ____________________________________

       (Date)

       

       

       

       

       

      
        	
                 
      

              	
                KD_2404365_2.DOC

              

      

       

      
        
          
             

          

           

        

        
          A-2Filed by sedaredgar.com - Cheetah Oil & Gas Ltd.- Exhibit 10.1

STOCK OPTION AGREEMENT 

CHEETAH OIL & GAS LTD. 

THIS AGREEMENT is entered into as of the 27th day of November,
2009 (the “Date of Grant”) 

BETWEEN: 

CHEETAH OIL & GAS LTD., a
company incorporated pursuant 
to the laws of the State of Nevada, of 17
Victoria Road, Nanaimo, 
British Columbia, V9R 4N9 

(the “Company”) 

AND: 

__________________, of
________________________________

(the “Optionee”) 

WHEREAS: 

A.         The Board of
Directors of the Company (the “Board”) has approved and adopted the 2009 Stock
Option Plan (the “Plan”), pursuant to which the Board is authorized to grant to
employees and other selected persons stock options to purchase common shares of
the Company (the “Common Stock”); 

B.         The Plan
provides for the granting of stock options that either (i) are intended to
qualify as “Incentive Stock Options” within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the “Code”), or (ii) do not qualify
under Section 422 of the Code (“Non-Qualified Stock Options”); and 

C.         The Board
has authorized the grant to the Optionee of options to purchase a total of
__________________ shares of Common Stock (the “Options”), which Options
are intended to be (select one): 

[   ] Incentive Stock
Options; 

[   ] on Qualified Stock
Options 

NOW THEREFORE, the Company agrees to offer to the Optionee the
option to purchase, upon the terms and conditions set forth herein and in the
Plan, 100,000 shares of Common Stock. Capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Plan. 

1.        Exercise Price.
The exercise price of the options shall be US $0.10 per share. 

- 2 - 

2.        Limitation on
the Number of Shares. If the Options granted hereby are Incentive Stock
Options, the number of shares which may be acquired upon exercise thereof is
subject to the limitations set forth in Section 5.1 of the Plan. 

3.        Vesting
Schedule. The Options shall vest in accordance with Exhibit A. 

4.        Options not
Transferable. The Options may not be transferred, assigned, pledged or
hypothecated in any manner (whether by operation of law or otherwise) other than
by will, by applicable laws of descent and distribution or, in the case of a
Non-Qualified Stock Option, pursuant to a qualified domestic relations order,
and shall not be subject to execution, attachment or similar process;
provided, however, that if the Options represent a Non-Qualified Stock
Option, such Option is transferable without payment of consideration to
immediate family members of the Optionee or to trusts or partnerships
established exclusively for the benefit of the Optionee and Optionee’s immediate
family members. Upon any attempt to transfer, pledge, hypothecate or otherwise
dispose of any Option or of any right or privilege conferred by the Plan
contrary to the provisions thereof, or upon the sale, levy or attachment or
similar process upon the rights and privileges conferred by the Plan, such
Option shall thereupon terminate and become null and void. 

5.        Investment
Intent. By accepting the Options, the Optionee represents and agrees that
none of the shares of Common Stock purchased upon exercise of the Options will
be distributed in violation of applicable federal and state laws and
regulations. In addition, the Company may require, as a condition of exercising
the Options, that the Optionee execute an undertaking, in such a form as the
Company shall reasonably specify, that the Stock is being purchased only for
investment and without any then-present intention to sell or distribute such
shares. 

6.        Termination of
Employment and Options. Vested Options shall terminate, to the extent not
previously exercised, upon the occurrence of the first of the following events:

	 	(a) 	
      Expiration. Five (5) years from the Date of
      Grant.

	 	 	 
	 	(b) 	
      Termination for Cause. The date of the first
      discovery by the Company of any reason for the termination of an
      Optionee’s employment or contractual relationship with the Company or any
      related company for cause (as determined in the sole discretion of the
      Plan Administrator), and, if an Optionee’s employment is suspended pending
      any investigation by the Company as to whether the Optionee’s employment
      should be terminated for cause, the Optionee’s rights under this Agreement
      and the Plan shall likewise be suspended during the period of any such
      investigation.

	 	 	 
	 	(c) 	
      Termination Due to Death or Disability. The
      expiration of one (1) year from the date of the death of the Optionee or
      cessation of an Optionee’s employment or contractual relationship by
      reason of disability (as defined in Section 5.1(g) of the Plan). If an
      Optionee’s employment or contractual relationship is terminated by death,
      any Option held by the Optionee shall be exercisable only by the person or
      persons to whom such Optionee’s rights under such Option shall pass by the
      Optionee’s will or by the laws of descent and
  distribution.

- 3 - 

	 	(d) 	
      Termination for Any Other Reason. The expiration
      of three (3) months from the date of an Optionee’s termination of
      employment or contractual relationship with the Company or any Related
      Corporation for any reason whatsoever other than termination of service as
      a director, cause, death or Disability (as defined in Section 5.1(g) of
      the Plan).

Each unvested Option granted pursuant hereto shall terminate
immediately upon termination of the Optionee’s employment or contractual
relationship with the Company for any reason whatsoever, including Disability
unless vesting is accelerated in accordance with Section 5.1(f) of the Plan.

7.        Stock. In
the case of any stock split, stock dividend or like change in the nature of
shares of Stock covered by this Agreement, the number of shares and exercise
price shall be proportionately adjusted as set forth in Section 5.1(m) of the
Plan. 

8.        Exercise of
Option. Options shall be exercisable, in full or in part, at any time after
vesting, until termination; provided, however, that any Optionee who is
subject to the reporting and liability provisions of Section 16 of the
Securities Exchange Act of 1934 with respect to the Common Stock shall be
precluded from selling or transferring any Common Stock or other security
underlying an Option during the six (6) months immediately following the grant
of that Option. If less than all of the shares included in the vested portion of
any Option are purchased, the remainder may be purchased at any subsequent time
prior to the expiration of the Option term. No portion of any Option for less
than fifty (50) shares (as adjusted pursuant to Section 5.1(m) of the Plan) may
be exercised; provided, that if the vested portion of any Option is less than
fifty (50) shares, it may be exercised with respect to all shares for which it
is vested. Only whole shares may be issued pursuant to an Option, and to the
extent that an Option covers less than one (1) share, it is unexercisable. 

Each exercise of the Option shall be by means of delivery of a
notice of election to exercise (which may be in the form attached hereto as
Exhibit B) to the President of the Company at its principal executive
office, specifying the number of shares of Common Stock to be purchased and
accompanied by payment in cash by certified check or cashier’s check in the
amount of the full exercise price for the Common Stock to be purchased. In
addition to payment in cash by certified check or cashier’s check, an Optionee
or transferee of an Option may pay for all or any portion of the aggregate
exercise price by complying with one or more of the following alternatives: 

	 	(a) 	
      by delivering to the Company shares of Common Stock
      previously held by such person, duly endorsed for transfer to the Company,
      or by the Company withholding shares of Common Stock otherwise deliverable
      pursuant to exercise of the Option, which shares of Common Stock received
      or withheld shall have a fair market value at the date of exercise (as
      determined by the Plan Administrator) equal to the aggregate purchase
      price to be paid by the Optionee upon such exercise; or

	 	 	 
	 	(b) 	
      by complying with any other payment mechanism approved by
      the Plan Administrator at the time of
exercise.

- 4 - 

It is a condition precedent to the issuance of shares of Common
Stock that the Optionee execute and/or deliver to the Company all documents and
withholding taxes required in accordance with Section 5.1 of the Plan. 

9.        Holding period
for Incentive Stock Options. In order to obtain the tax treatment provided
for Incentive Stock Options by Section 422 of the Code, the shares of Common
Stock received upon exercising any Incentive Stock Options received pursuant to
this Agreement must be sold, if at all, after a date which is later of two (2)
years from the date of this agreement is entered into or one (1) year from the
date upon which the Options are exercised. The Optionee agrees to report sales
of shares prior to the above determined date to the Company within one (1)
business day after such sale is concluded. The Optionee also agrees to pay to
the Company, within five (5) business days after such sale is concluded, the
amount necessary for the Company to satisfy its withholding requirement required
by the Code in the manner specified in Section 5.1(l) of the Plan. Nothing in
this Section 9 is intended as a representation that Common Stock may be sold
without registration under state and federal securities laws or an exemption
therefrom or that such registration or exemption will be available at any
specified time. 

10.      Resale restrictions may apply.
Any resale of the shares of Common Stock received upon exercising any
Options will be subject to resale restrictions contained in the securities
legislation applicable to the Optionee. The Optionee acknowledges and agrees
that the Optionee is solely responsible (and the Company is not in any way
responsible) for compliance with applicable resale restrictions. 

11.      Subject to 2009 Stock
Option Plan. The terms of the Options are subject to the provisions of the
Plan, as the same may from time to time be amended, and any inconsistencies
between this Agreement and the Plan, as the same may be from time to time
amended, shall be governed by the provisions of the Plan, a copy of which has
been delivered to the Optionee, and which is available for inspection at the
principal offices of the Company. 

12.      Professional Advice.
The acceptance of the Options and the sale of Common Stock issued pursuant to
the exercise of Options may have consequences under federal and state tax and
securities laws which may vary depending upon the individual circumstances of
the Optionee. Accordingly, the Optionee acknowledges that he or she has been
advised to consult his or her personal legal and tax advisor in connection with
this Agreement and his or her dealings with respect to Options. Without limiting
other matters to be considered with the assistance of the Optionee’s
professional advisors, the Optionee should consider: (a) whether upon the
exercise of Options, the Optionee will file an election with the Internal
Revenue Service pursuant to Section 83(b) of the Code and the implications of
alternative minimum tax pursuant to the Code; (b) the merits and risks of an
investment in the underlying shares of Common Stock; and (c) any resale
restrictions that might apply under applicable securities laws. 

13.      No Employment
Relationship. Whether or not any Options are to be granted under this Plan
shall be exclusively within the discretion of the Plan Administrator, and
nothing contained in this Plan shall be construed as giving any person any right
to participate under this Plan. The grant of an Option shall in no way
constitute any form of agreement or understanding binding on the Company or any
Related Company, express or implied, that the Company or any Related Company
will employ or contract with an Optionee, for any length of time, nor shall it
interfere 

- 5 - 

in any way with the Company’s or, where applicable, a Related
Company’s right to terminate Optionee’s employment at any time, which right is
hereby reserved. 

14.      Entire Agreement. This
Agreement is the only agreement between the Optionee and the Company with
respect to the Options, and this Agreement and the Plan supersede all prior and
contemporaneous oral and written statements and representations and contain the
entire agreement between the parties with respect to the Options. 

15.      Notices. Any notice
required or permitted to be made or given hereunder shall be mailed or delivered
personally to the addresses set forth below, or as changed from time to time by
written notice to the other: 

The Company: 

Cheetah Oil & Gas Ltd.

17 Victoria Road 
Nanaimo, BC V9R 4N9 
Attention: President 

With a copy to: 

Clark Wilson LLP 
Barristers and
Solicitors 
Suite 800 - 885 West Georgia Street 
Vancouver, British
Columbia V6C 3H1 
Attention: William Macdonald 

The Optionee: 

_____________________

_____________________

_____________________

_____________________

CHEETAH OIL & GAS LTD. 

 

Per: 
_____________________________________
        
Authorized Signatory 

 

 

_________________________________________
[Insert Optionee
Name] 

- 6 - 

EXHIBIT A 

TERMS OF THE OPTION

	Name of the Optionee: 	<> 
	 	 
	Date of Grant: 	<> 
	 	 
	Designation: 	Incentive Stock Options 
	 	 
	1.        Number of
      Options granted: 	<> stock options 
	 	 
	2.        Purchase
      Price: 	$<> per share 
	 	 
	3.        Vesting
      Dates: 	<> 
	 	 
	4.        Expiration
      Date: 	<> 

- 7 - 

EXHIBIT B 

To: 

Cheetah 

Oil & Gas Ltd. 

  17 Victoria Road 

  Nanaimo, BC V9R 4N9 

Attention: President 

Notice of Election to Exercise

This Notice of Election to Exercise shall constitute proper
notice pursuant to Section 5.1(h) of Cheetah Oil & Gas Ltd.’s (the
“Company”) 2009 Stock Option Plan (the “Plan”) and Section 8 of that certain
Stock Option Agreement (the “Agreement”) dated as of the _______ day of
__________________, 20___, between the Company and the undersigned. 

The undersigned hereby elects to exercise Optionee’s option to
purchase __________________ shares of the common stock of the Company at a price
of US$_______ per share, for aggregate consideration of US$__________, on the
terms and conditions set forth in the Agreement and the Plan. Such aggregate
consideration, in the form specified in Section 8 of the Agreement, accompanies
this notice. 

The Optionee hereby directs the Company to issue, register and
deliver the certificates representing the shares as follows: 

  	Registration Information: 	 	Delivery Instructions: 
	 	 	 
	 	 	 
	Name to appear on
      certificates 	 	Name
  
	 	 	 
	 	 	 
	Address 	 	Address
    
	  	 	  
	 	 	 
	   	 	Telephone Number 

DATED at ____________________________________, the _______ day
of ________________________, 20___. 

 

	 	 
	 	(Name of Optionee – Please type or print)

	 	 
	 	 
	 	(Signature and, if applicable, Office) 
	 	 
	 	 
	 	(Address of Optionee) 
	 	 
	 	 
	 	(City, State, and Zip Code of Optionee)

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