Document:

exv10w6

 

Exhibit 10.6

 

ALLIANCE BANK CORPORATION

STOCK OPTION PLAN

 

ALLIANCE BANK CORPORATION

STOCK OPTION PLAN

     
THIS STOCK OPTION PLAN as amended and restated
herein, (the “Plan”) is hereby adopted and ratified
effective as of March 24, 1999, by ALLIANCE BANK
CORPORATION, a Virginia corporation (the
“Corporation”).

     
1.     Purpose. The
purpose of this Plan is to advance the interests of the
Corporation and its shareholders by providing key employees,
consultants and members of the Board of Directors of the
Corporation with an incentive to improve shareholder value and
contribute to the growth of the Corporation by giving certain
key employees, consultants and board members an inducement to
acquire a proprietary interest in the Corporation by possessing
an option to purchase common stock of the Corporation
(hereinafter referred to as an “option” or “stock
option”).

     
2.     Administration.
This Plan shall be administered by the Board of Directors of the
Corporation (the “Board”) acting upon recommendations
made by the stock option committee (the “Committee”)
appointed by the Board.

		
	 	
    A. Committee Members. There shall be up to
    seven (7) members of the Committee, all of whom are Board
    members and one of whom is a member of the Personnel Committee
    of the Board. The Committee members and the Committee Chairman
    shall be appointed by the Board and may only be removed or
    replaced by the Board.
    
	 
	 	
    B. Plan Construction. The Board shall be
    responsible for construing and interpreting the provisions of
    the Plan, upon the advice and recommendations of the Committee.
    The Board shall adopt rules for the administration of the Plan
    consistent with the terms of the Plan. The Committee may adopt
    such further rules as it deems necessary consistent with the
    rules adopted by the Board.
    
	 
	 	
    C. Option Eligibility and Terms. The
    Committee shall recommend to the Board which key employees,
    board members and consultants of the Corporation shall receive
    stock options hereunder (“Grantees”). From time to
    time the Committee shall provide the Board, for approval,
    modification or rejection by the Board within its sole
    discretion, with a list of all Grantees who are recommended by
    the Committee to receive stock options, the conditions under
    which the stock options will be granted, the number of stock
    options for each such Grantee, the option exercise price for
    each such option and the other terms and provisions of the
    option, consistent with the provisions of this Plan. The Board
    shall take action with respect to such recommendations as
    expeditiously as possible. Stock Option Agreements reflecting
    the terms and conditions of the stock options approved by the
    Board shall be issued to Grantees as soon as possible following
    the Board meeting at which they were granted. Participation by a
    Grantee in the grant of options for any one year does not
    entitle such Grantee to participation in any subsequent year.
    

 

		
	 	
    D. Indemnification. The Corporation shall
    indemnify and hold harmless the members of the Committee and the
    Board for all actions taken in good faith in connection with the
    administration of the Plan.
    
	 
	 	
    E. Effect of Committee’s and
    Board’s Decision. All actions taken and decisions and
    determinations made by the Committee and the Board on all
    matters relating to the Plan pursuant to the powers vested in it
    hereunder shall be in the Committee’s and Board’s sole
    and absolute discretion and shall be conclusive and binding on
    all parties concerned, including the Corporation, its
    stockholders, any participants in the Plan and any other
    employee of the Corporation, and their respective successors in
    interest.
    
	 
	 	
    F. Action by the Board or Committee. The
    Committee shall meet at such times and places and upon such
    notices as it may determine. A majority of the Committee shall
    constitute a quorum. Any acts by the Committee may be taken at
    any duly noticed meeting at which a quorum is present and shall
    be by majority vote of those members entitled to vote. Members
    of the Board or Committee who are either eligible for options or
    have been granted options may vote on any matters affecting the
    administration of the Plan or the grant of options pursuant to
    the Plan, except that no such member shall set upon the granting
    of an option to himself or herself, but any such member may be
    counted in determining the existence of a quorum at any meeting
    of the Board or the Committee during which action is taken with
    respect to the granting of an option to him or her.
    

     
3.     Option Shares and
Types.

		
	 	
    A. Type of Options. The Plan permits the
    granting of stock options (“incentive stock options”)
    which qualify under Section 422 of the Internal Revenue
    Code of 1986, as amended (“Code”) as well as stock
    options (“nonqualified stock options”) which do not so
    qualify.
    
	 
	 	
    B. Number of Shares subject to Options.
    

		
	 	     
    (i) The Board, acting upon recommendation of
    the Committee, may grant stock options under this Plan to
    directors with respect to a maximum of One Hundred Forty Four
    Thousand (144,000) shares of the Corporation’s common stock
    (the “Common Stock”).
    
	 
	 	     
    (ii) Key Employees and Consultants. Subject
    to the Board, acting upon recommendation of the Committee, may
    grant stock options under the Plan with respect to key employees
    and consultants with respect to a maximum of Ninety Eight
    Thousand (98,000) shares of the Common Stock, or, if lesser,
    Eighteen Thousand (18,000) shares plus the increase in the
    number of authorized shares of Common Stock 

    

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    that is approved by the shareholders of the
    Corporation at the meeting in which this Plan is approved by
    such shareholders.
    

		
	 	     
    (iii) The Board shall reserve for issuance
    under the Plan the number of shares authorized for issuance
    under subsections (i) and (ii) above, which shall
    constitute the maximum number of shares that may be issued
    pursuant to option under the Pan, including incentive stock
    options under Code Section 422. If any stock option, or
    portion of an option, under the Plan expires or terminates
    unexercised, becomes unexercisable or is forfeited or otherwise
    terminated, surrendered or canceled as to any shares, such
    shares shall thereafter be available for further stock options
    under the Plan in accordance with either subsection (i) or
    (ii) above, as determined by the Board of Directors, acting upon
    the recommendation of the Committee.
    

		
	 	
    C. Restrictions on Incentive Stock Options.
    Incentive stock options granted under the Plan shall comply in
    all respects with applicable law, including Code
    Section 422, and shall include the following additional
    requirements.
    

		
	 	     
    (i) Grant Date. An incentive stock option
    must be granted within 10 years of the earlier of the
    Plan’s adoption by the Board of Directors or approval by
    the Corporation’s shareholders.
    
	 
	 	     
    (ii) Exercise Price and Term. The exercise
    price of an incentive stock option shall not be less than 100%
    of the fair market value of the shares on the date the stock
    option is granted and the term of the stock option shall not
    exceed ten years. Also, the exercise price of any incentive
    stock option granted to a grantee who owns (within the meaning
    of Section 422(b)(5) of the Code, after the application of
    the attribution rules in Section 424(d) of the Code) more
    than 10% of the total combined voting power of all classes of
    shares of the Corporation or any parent or subsidiary
    corporations (within the meaning of Sections 422 and 424 of
    the Code) shall be not less than 110% of the fair market value
    of the Common Stock on the grant date and the term of such stock
    option shall not exceed five years.
    
	 
	 	     
    (iii) Maximum Grant. The aggregate fair
    market value (determined as of the Date of Grant) of shares of
    Common Stock with respect to which all incentive stock options
    first become exercisable by any Grantee in any calendar year
    under this or any other plan of the Corporation and its parent
    and subsidiary corporation may not exceed $100,000 or such other
    amount as may be permitted from time to time under
    Section 422 of the Code. To the extent that such aggregate
    fair market value shall exceed $100,000, or other applicable
    amount, such stock options shall be treated as nonqualified
    stock options. In such case, the Corporation may designate the
    shares of Common Stock that are to be treated as stock acquired
    pursuant to the exercise of an incentive stock option by issuing
    a separate certificate for such shares and identifying the
    certificate as incentive stock option shares in the stock
    transfer records of the Corporation.
    

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    (iv) Grantee. Incentive stock options shall
    only be issued to employees of the Corporation, or of a parent
    or subsidiary of the Corporation.
    
	 
	 	     
    (v) Designation. No stock option shall be an
    incentive stock option unless so designated by the Committee at
    the time of grant or in the Grant Agreement evidencing such
    stock option.
    
	 
	 	     
    (vi) Stockholder Approval. No stock option
    issued under the Plan shall be an incentive stock option unless
    the Plan is approved by the shareholders of the Corporation
    within 12 months of its adoption by the Board in accordance
    with the Bylaws and Articles of the Corporation and governing
    law relating to such matters.
    

     
4.     Exercise Price. A
Grantee of a stock option granted under this Plan may purchase
up to the number of shares subject to the option at a purchase
price of no less than the fair market value of such shares
determined on the date of grant of the option. For purposes of
the Plan, the fair market value of a share of Common Stock shall
be determined in a manner such as the Board of Directors, acting
upon the recommendation of the Committee, in good faith decides
is appropriate taking into account such factors as whether the
shares are publicly traded on an established securities
exchange, the latest price paid for such shares in an arms
length transaction, the gross revenues and net profit, if any,
for the most recent fiscal period of the Corporation, the book
value of the Corporation and recommendations made through
consultance with outside professionals. In no event shall the
fair market value of the Corporation’s Common Stock as
determined under this paragraph be lower than 100% of the book
value per share as shown by the Corporation’s most recent
published statement of its financial condition prior to the
granting of any option.

     
5.     Exercise of
Option. A Grantee’s right to exercise his or her stock
option shall be subject to all of the terms and conditions of
the Plan and the terms and conditions of the Stock Option
Agreement that will be entered into between the Grantee and the
Corporation. Said Stock Option Agreement shall contain such
provisions as may be determined by the Board, acting upon
recommendation of the Committee, consistent with the terms of
the Plan, and shall provide that options shall be exercised in
the following manner:

		
	 	
    A. Time of Exercise. A stock option granted
    under this Plan may be exercised (prior to expiration or
    termination as provided below) in accordance with the vesting
    schedule provided in the respective Stock Option Agreement,
    which vesting schedule is recommended by the Committee subject
    to the approval of the Board. Options may be exercised in any
    amount up to the amount eligible for exercise. However, unless
    terminated earlier below, all options granted under this Plan
    will expire no later than ten (10) years after the date granted
    and the unvested portion of an option will terminate on the date
    of Grantee’s termination of service with the Corporation.
    
	 
	 	
    B. Method of Exercise. The options shall be
    exercised by written notice as directed by the Committee, at the
    Corporation’s principal place of business, accompanied by
    full payment of the option exercise price for the number of
    shares specified and paid for. The exercise price shall be paid
    in cash or, 

    

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    within the discretion of the Committee subject to
    approval by the Board, with shares of the Corporation’s
    Common Stock (including shares that would otherwise be issued as
    a result of the option exercise) having fair market value on the
    exercise date equal to the exercise price. The Corporation shall
    make immediate delivery of such shares under the terms of the
    Stock Option Agreement, provided that if any law or regulation
    requires the Corporation to take any action with respect to the
    shares specified in such notice before the issuance thereof,
    then the date of delivery of such shares shall be extended for
    the period necessary to take such action. However, nothing under
    the Plan shall be construed in a manner to require the
    Corporation to register its Common Stock or this Plan pursuant
    to the Securities Act of 1933 or any state securities act. The
    Corporation shall have no obligation to issue shares pursuant to
    the exercise of any option if the Board determines that such
    issuance will not be in compliance with all applicable rules,
    regulations, and federal and state laws.
    
	 
	 	
    C. Termination of Option. The options, to
    the extent not previously exercised, shall terminate upon the
    termination of the Grantee’s employment or service with the
    Corporation for cause, twelve (12) months after termination
    of employment or service due to the death or incapacity of the
    Grantee or three (3) months following the Grantee’s
    termination of employment or service with the Corporation for
    any other reason (including, without limiting the generality of
    the foregoing, the voluntary termination by the Grantee, or the
    involuntary termination of the Grantee without cause). Whether
    cause existed for a Grantee’s involuntary termination of
    employment with the Corporation shall be determined in the sole
    discretion of the Committee subject to approval by the Board.
    

     
6.     Capital
Adjustment Due to Reorganization and Other Events.

		
	 	
    A. 
	 
	 	
    B. In the event of the sale or exchange of
    substantially all of the Corporation’s assets or over fifty
    percent of the Corporation’s outstanding Common Stock to
    another entity or person or the reorganization, consolidation or
    merger of the Corporation with another corporation (a
    “Change of Control”), the Board, acting upon
    recommendation from the Committee, shall be entitled to take
    such action as it deems to be appropriate and equitable to
    effectuate the purposes of the Plan and to protect grantees of
    options under the Plan. Such actions may include, but without
    limitation, one or more of the following: (i) acceleration
    or change of the exercise dates and termination dates of any
    option to require that exercise be made, if at all, prior to the
    Change of Control; (ii) cancellation of any option upon
    payment to the holder in cash of the fair market value of the
    Common Stock subject to such option as of the date of (and, to
    the extent applicable, as established for purposes of) the
    Change of Control, less the aggregate exercise price of the
    stock option; and (iii) in any case where equity securities
    of another entity are proposed to be delivered in 

    

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    exchange for or with respect to Common Stock of
    the Corporation, arrangements to have the Grantee receive, in
    substitution for options for the Corporation’s stock
    options with respect to shares of such other corporation in the
    same proportion, at an equivalent price, and subject to the same
    conditions. For purposes of subsection (iii) of the
    preceding sentence, the excess of the fair market value of the
    Corporation’s shares subject to the old option over the
    aggregate option exercise price of such shares shall not be more
    than the excess of the fair market value of the other
    corporation’s shares subject to the new option over the
    aggregate exercise price of such sales, and the substitution of
    the new option for the old option shall not give the Grantee
    additional benefits which he did not have under the old option,
    or deprive him of benefits which he had under the old option.
    

     
7.     Rights Prior to
Exercise of Option. The Grantee shall have no rights as a
stockholder of the Corporation with respect to the option shares
until payment of the option price and delivery to him or her of
such shares. The options granted under this Plan shall be
nontransferable by the Grantee other than by will or the laws of
descent and distribution and shall be exercisable during the
lifetime of the Grantee only by the Grantee or any guardian or
legal representative of the Grantee. Notwithstanding the above,
within the discretion of the Committee, nonqualified stock
options may be transferred, by gift to, or in trust for the
benefit of, the Grantee, or the Grantee’s spouse, parent or
parents, or any direct descendant or descendants. In case of any
such transfer by gift, the donor or donors shall receive and
hold such options subject to the restrictions on encumbrances
and disposition set forth in the Plan and the Stock Option
Agreement.

     
8.     Effective Date.
This Plan shall be effective as of March 24, 1999, provided
it is approved by a majority of the shareholders of the
Corporation within 12 months before or after such date.

     
9.     Amendment or
Termination of Plan. The Board of Directors reserves the right
to terminate the Plan or revise or amend the Plan at any time or
times in any such manner as it deems appropriate to best serve
the needs and interests of the Corporation and its shareholders
or to bring the Plan into compliance or to maintain the Plan in
compliance with applicable law. However, the Plan may not be
revised or amended without the approval of a majority of the
Corporation’s shareholders to increase the number of shares
which may be subject to options under the Plan or as otherwise
required by law or any applicable rule or regulation of any
regulatory body which is applicable to the Corporation and the
Plan including without limitation Code Section 422.
Notwithstanding the foregoing, no such termination or amendment
shall, without the Grantee’s consent, change or impair any
of the rights or obligations of the Grantee under any options
previously granted to the Grantee, or with respect to any common
shares acquired by the Grantee as the result of the exercise of
any of the options granted under the Plan.

     
10.     Termination of
Service. Nothing in the Plan or in any Stock Option Agreement
thereunder shall confer any right on any Grantee to continue in
the service of the Corporation in any capacity or shall
interfere in any way with the right of the Corporation to
terminate the service of a Grantee at any time.

     
11.     Non-Uniform
Discriminations. The Committee’s determinations under the
Plan (including without limitation determinations of the persons
to receive options, the form, amount and timing of such options,
the terms and

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provisions of such options and the agreements
evidencing same) need not be uniform and may be made by it
selectively among persons who receive, or are eligible to
receive, options under the Plan, whether or not such persons are
similarly situated.

     
12.     Securities Laws.
The Corporation may require that a Grantee, as a condition to
exercise of an option, and as a condition to the delivery of any
share certificate, provide to the Corporation, at the time of
each such exercise and each such delivery, a written
representation that the shares of Common Stock being acquired
shall be acquired by the Grantee solely for investment and will
not be sold or transferred without registration or the
availability of an exemption from registration under the
Securities Act of 1933 and applicable state securities laws. The
Corporation may also require that a Grantee submit other written
representations which will permit the Corporation to comply with
federal and applicable state securities laws to connection with
the issuance of the Common Stock, including representations as
to the knowledge and experience in financial and business
matters of the Grantee and the Grantee’s ability to bear
the economic risk of the Grantee’s investment. The
Corporation may require that the Grantee obtain a
“purchaser representative” as that term is defined in
applicable federal and state securities laws. The stock
certificates for any shares of Common Stock issued pursuant to
this Plan may bear a legend restricting transferability of the
shares of Common Stock unless such shares are registered or an
exemption from registration is available under the Securities
Act of 1933 and applicable state securities laws.

     
13.     Articles and
Bylaws. This Plan is subject to the Articles and By-Laws of the
Corporation, as they may be amended from time to time.

     
14.     Virginia Law.
This Plan shall be interpreted under and construed in accordance
with the laws of the Commonwealth of Virginia, except to the
extent preempted by federal law, which to such extent shall
govern.

     
THIS PLAN is adopted and ratified by action of
the Board of Directors at a meeting held at the
Corporation’s headquarters on April 21, 1999.

7exv10w2

 

Exhibit 10.2

FIRST AMENDMENT TO

THE INVESTMENT AND MANAGEMENT AGREEMENT

OF RIGGS CAPITAL PARTNERS, LLC

         THIS FIRST AMENDMENT is entered into as of January 1, 2002 (the “First
Amendment”), by and between RIGGS CAPITAL PARTNERS, LLC and RCP INVESTMENTS,
L.P. amending the Investment and Management Agreement of RIGGS CAPITAL
PARTNERS, LLC, a Delaware limited liability company (the “Company”), dated as
of the 1st day of December, 2000 (the “Original Agreement”). Riggs Capital
Partners, LLC and RCP Investment, L.P. are hereinafter known as the “parties”
to this First Amendment.

WITNESSTH

         WHEREAS, the parties wish to amend the Original Agreement to designate RCP
Ventures Management Inc., a Delaware corporation, as the Management Company (as
that term is defined in the Original Agreement); and

         WHEREAS, RCP Ventures Management Inc. and the parties have executed an
Agreement of Joinder of even date herewith whereby RCP Ventures Management Inc.
has acknowledged and agreed to be bound by the terms of the Original Agreement
pertaining to the Management Company.

         NOW, THEREFORE, in consideration of the premises and mutual promises
hereinafter set forth, the parties hereto do hereby amend the Original
Agreement as follows:

         1.     In the first sentence of the first paragraph of the Original Agreement,
the phrase “RCP INVESTMENTS, L.P.” is hereby replaced with the phrase “RCP
Ventures Management Inc.” with the result being that in the Original Agreement,
as amended by this First Amendment, the “Management Company” means “RCP
Ventures Management Inc.”

         2.     Section 8 of the Original Agreement is hereby amended by replacing “RCP
Investments, L.P.” as the entity to receive notification under the Original
Agreement with “RCP Ventures Management Inc.”

         3.     Except as specifically provided herein, the Original Agreement shall
remain in full force and effect. This First Amendment may be executed in any
number of counterparts, all of which shall constitute a single instrument.
This First Amendment shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, successors and assigns.

(Signatures on next page.)

 

1

 

         IN WITNESS WHEREOF, the undersigned have set their hands as of the day and
year first above written.

	 	 	 	 	 
	 	 	RIGGS CAPITAL PARTNERS, LLC
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
BY:
	 	Riggs National Corporation

Managing Member
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
BY:
	 	/s/ Timothy C. Coughlin

Name: Timothy C. Coughlin

Title: President
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	RCP INVESTMENTS, L.P.
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
BY:
	 	/s/ J. Carter Beese, Jr.

Name: J. Carter Beese, Jr.

Title: General Partner

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JOINDER TO

THE INVESTMENT AND MANAGEMENT AGREEMENT OF

RIGGS CAPITAL PARTNERS, LLC

         Concurrently with the execution of the First Amendment to the Investment
and Management Agreement of Riggs Capital Partners, LLC (the “IM Agreement”),
RCP Ventures Management Inc. has executed this Joinder thereto.

WITNESSTH

         WHEREAS, RCP Ventures Management Inc. was formed to provide certain
investment and management services to Riggs Capital Partners, LLC (“Fund I”)
and Riggs Capital Partners II, LLC (“Fund II”) in exchange for equitable
compensation;

         WHEREAS, the above mentioned investment and management services have been
provided prior to the execution of this Joinder to Fund I by RCP Investments,
LLC (“Investments I”) and Fund II by RCP Investments II, LLC (“Investments
II”);

         WHEREAS, the members of Fund I, being Riggs National Corporation and
Investments I (the “Members”), who are the parties to the Operating Agreement
of Riggs Capital Partners, LLC dated as of November 30, 1999 (the “Operating
Agreement”), the First Amendment thereto dated December 1, 2000 and the Second
Amendment thereto dated March 31, 2001, have concurrently herewith executed the
Third Amendment to the Operating Agreement (with the First, Second and Third
Amendments to the Operating Agreement being collectively referred to as the
“Operating Agreement Amendments”), which designated RCP Ventures Management
Inc. as the Investment Advisor (as that term is defined in such agreement) to
Fund I and, concurrently therewith, RCP Ventures Management Inc. has executed a
Joinder to the Operating Agreement;

         WHEREAS, Fund I and Investments I, who are the parties to the Investment
and Management Agreement dated as of December 1, 2000, have concurrently
herewith executed the First Amendment to such agreement which designated RCP
Ventures Management Inc. as the Management Company (as that term is defined in
such agreement) for Fund I; and

         WHEREAS, Riggs Bank N.A. and Investments I, who are parties to the
Operating and Services Agreement dated as of December 1, 2000, and along with
Investments II are parties to the First Amendment thereto dated as of December
1, 2000, have all concurrently herewith executed the Second Amendment to such
agreement which designated RCP Ventures Management Inc. as the Management
Company (as that term is defined in such agreement) and, concurrently
therewith, RCP Ventures Management Inc. has executed a Joinder to the Operating
and Services Agreement and the First Amendment thereto.

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         NOW THEREFORE, in consideration of the actions taken that are listed above
and the premises hereinafter set forth:

         The undersigned, RCP Ventures Management Inc., hereby executes this
Joinder and in so doing agrees to be bound by the terms and conditions
applicable to the Management Company (as that term is defined in the IM
Agreement) and shall for such purposes be deemed a party to the IM Agreement.

Dated: January 1, 2002

	 	 	 	 	 
	 	 	RCP Ventures Management Inc.
	
	
	
	

	 	 	 	 	 
	
	
	
	

	 	 	
By:
	 	/s/ J. Carter Beese, Jr.

J. Carter Beese, Jr.

Chairman & Chief Executive Officer

4

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