Document:

Stock Option Agreement Dated July 5, 2005

 EXHIBIT 10.20 
 Valley Financial Corporation 
 Incentive Stock Option Agreement 
 THIS AGREEMENT is between Valley Financial Corporation (the “Company”) and James Randall Woodson (the “Optionee”), and is
dated as of July 5, 2005 (the “Date of Grant”). 
 The Company hereby grants the Optionee an option to purchase Shares of the
Stock of the Company, subject to the terms and conditions of this Agreement. 
 The grant of this option is made pursuant to the Valley
Financial Corporation 2005 Key Employee Equity Award Plan (the “Plan”), a copy of which has been provided to the Optionee, receipt of which is hereby acknowledged. The terms of the Plan are incorporated into this Agreement by reference. In
the case of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control. Any term used in this Agreement that is defined in the Plan shall have the same meaning given to that term in the Plan. 
 10. Grant of Option. The Company grants the Optionee an Incentive Stock Option (the “Option”) to purchase from the Company 5,000
Shares at $13.00 per Share (the “Exercise Price”). The Exercise Price is not less than 100% of the Fair Market Value per Share on the Date of Grant. The Option is intended to be a stock option that receives special tax treatment
under Section 422 of the Internal Revenue Code (the “Code”). 
 11. Entitlement to Exercise Option. 
 (a) The Optionee will become vested in and entitled to exercise the Option as follows: 
  

					
	 Vesting Date
	  	Number of Shares	  	Total Vested Shares
	 July 5, 2006
	  	1,000	  	1,000
	 July 5, 2007
	  	1,000	  	2,000
	 July 5, 2008
	  	1,000	  	3,000
	 July 5, 2009
	  	1,000	  	4,000
	 July 5, 2010
	  	1,000	  	5,000

 This Option shall not vest as to any Shares if Optionee is not an employee of the Company on the
respective Vesting Date. 
 (b) Except as otherwise stated in this paragraph, the Option may be exercised to the extent it is
vested only while the Optionee is employed by the Company. 
 (i) If the Optionee retires or ceases to be employed by the
Company for any reason other than his or her death or Disability and at a time when all or a portion of this Option was vested and exercisable pursuant to paragraph (a) above, the Optionee may exercise any or all of his vested Option within
three months after he or she terminates employment. “Disability” or “Disabled” means a condition resulting from bodily injury or disease that renders Optionee unable to perform any and every duty pertaining to Optionee’s
employment with the Company. The Board of Directors of the Company, in its sole discretion, will determine whether Optionee is Disabled based on medical evidence and Optionee’s eligibility for benefits under the long-term disability plan
maintained by the Company, if any. The date the Board makes this determination will be considered the date of Disability for purposes of this Agreement. 

 (ii) If the Optionee terminates employment because of a Disability, he or she may
exercise any or all of a portion of the vested Option (determined as of the Optionee’s termination date) within one year after the Disability termination date. 
 (iii) If the Optionee dies while he or she is employed by the Company or within three months after he or she terminates employment because
of a Disability, the Optionee’s beneficiary may exercise this Option within one year after the Optionee’s death, but only to the extent the Option was vested and exercisable immediately before the Optionee’s death. 
 (c) The aggregate Fair Market Value (determined by reference to the Option Price on the Date of Grant) of the Option shares exercisable by
the Optionee for the first time during a calendar year may not exceed $100,000 (the “Limitation Amount”). Incentive Stock Options granted under this agreement and any other incentive stock option agreements between the Optionee and the
Company shall be aggregated for purposes of the Limitation Amount. The portion of the Option that fails to become exercisable because of the Limitation Amount shall be exercisable (to the extent otherwise exercisable) as a Non-Qualified Stock
Option. 
 (d) In no event may this Option be exercised after July 5, 2015. 
 12. Method of Exercise and Payment. 
 (a) The Optionee may exercise his Option by delivering a written notice to the Company in the form attached as Exhibit A. The exercise date will be (i) in the case of notice by mail, the date of postmark; or
(ii) if delivered in person, the date of delivery. The notice must be signed and state the number of Shares the Optionee has elected to purchase. The Optionee may exercise the Option in whole or in part, but only with respect to whole Shares.

 (b) The exercise notice must be accompanied by payment of the Exercise Price in full by cash (which shall include payment
by check, bank draft or money order payable to the Company). Instead of paying cash, the Optionee may substitute Shares of the Company’s Stock that he or she previously acquired (and has owned for at least six months) for all or part of the
cash payment. Shares used as payment will be valued at their Fair Market Value on the date of exercise. 
 13. Nontransferability.
This Option is not transferable by the Optionee other than by will or by the laws of descent and distribution. 
 14. Notice of Early
Disposition. By signing this Agreement, the Optionee agrees to give the Company prompt written notice of a sale or disposition of Option Shares (i) within two years from the date on which the Option was granted, or (ii) within one year
from the date on which the Option Shares were transferred to the Optionee. If the Optionee fails to give the Company prompt written notice, he or she will be liable to the Company for any loss of deduction, any penalty imposed, and any other
financial loss incurred by the Company as a result of his or her failure to give prompt notice. 
 15. Employment Rights. Neither the
Plan nor this Agreement confers upon the Optionee any right to continue as an employee of the Company or limits in any respect the right of the Company to terminate the Optionee’s employment. 
 16. Governing Law. This Agreement shall be governed by the laws of the state of Virginia. 

 17. Acceptance of Option. This Agreement deals only with the Option the Optionee has been granted
and not its exercise. The Optionee’s acceptance of the Option places no obligation or commitment on the Optionee to exercise the Option. By signing below, the Optionee indicates acceptance of the Option and his or her agreement to the terms and
conditions set forth in this Agreement, which, together with the terms of the Plan, shall become the Company’s Stock Option Agreement with the Optionee. The Optionee also acknowledges receipt of a copy of the Plan and agrees to all of the terms
and conditions of the Plan. This Agreement will not be effective until it is signed and returned. 
 18. Entire Agreement, Amendment.
This Agreement constitutes the entire agreement between the Optionee and the Company with respect to the Option shares and shall be binding upon Optionee’s legatees, distributees, and personal representatives and the successors of the Company.
This Agreement may only be amended by a writing signed by both the Optionee and the Company. 
  

			
	Valley Financial Corporation
		
	By:	 	/s/ Ellis L. Gutshall
	Its:	 	President / Chief Executive Officer
	Date:	 	July 5, 2005

			
		
	Signature:	 	  

 Exhibit A 
 NOTICE OF EXERCISE OF STOCK OPTION 
 TO PURCHASE COMMON STOCK OF VALLEY FINANCIAL CORPORATION 
 Name:__________________________________ 
 Address:________________________________ 
 _______________________________________ 
 Date:___________________________________ 
 Valley Financial
Corporation 
 Attention: ____________________ 
  

	 	Re:	Exercise of Incentive Stock Option 

 Gentlemen: 
 Subject to acceptance by Valley Financial Corporation (the “Company”) pursuant to the provisions of the Valley Financial Corporation 2005 Key
Employee Equity Award Plan, I hereby elect to exercise options granted to me to purchase ___________ Shares of Stock (the “Stock”) under the Incentive Stock Option Agreement dated [DATE] (the “Agreement”), at a price of
$ [PRICE] per share, for a total of $________ (the “Exercise Price”). 
 I shall pay for the Stock as follows: 

By cash, certified check, or bank cashier’s check, enclosed, for $_______________ for the full Exercise Price, payable to Valley Financial
Corporation. 
 By the enclosed certificate representing ____ Shares of Stock with a Fair Market Value equal to the Exercise Price
($_________) that I have held for at least six months. 
 As soon as the Stock Certificate is registered in my name, please deliver it to me
at the above address. 
 I represent and warrant to the Company that: 
 (a) I am acquiring the Stock for my own account as principal for investment and not with a view to resale or distribution. 
 (b) I am not acquiring the Stock based upon any representation, oral or written, by any person with respect to the future value of, or
income from, the Stock but rather upon an independent examination and judgment as to the prospects of the Company. The Stock was not offered to me by means of publicly disseminated advertisements or sales literature, nor am I aware of any offers
made to other persons by such means. I am able to bear the economic risks of the investment in the Stock, including the risk of a complete loss of my investment therein. 
 (c) I recognize that purchase of the Stock involves a high degree of risk and have taken full cognizance of and understand such risk.

 (d) I have and have had complete access to and the opportunity to review and make copies
of all material documents related to the business of the Company, including, but not limited to, contracts, financial statements, tax returns, leases, deeds and other books and records. I have examined such of these documents as I wished and am
familiar with the business and affairs of the Company. I realize that the purchase of the Stock is a speculative investment and that any possible profit therefrom is uncertain. I have had the opportunity to ask questions of and receive answers from
the Company and any person acting on its behalf and to obtain all material information reasonably available with respect to the Company and its affairs. I have received all information to date with respect to the Company which I have requested and
have deemed relevant in connection with the evaluation of the merits and risks of my investment in the Company. I have such knowledge and experience in financial and business matters that I am capable of evaluating the merits and risks of the
purchase of the shares hereunder. I understand that the Company has relied on my representations as set forth in this Notice of Exercise in determining materiality for purposes of the disclosure obligations of the Company under federal and state
securities laws. 
 (e) I understand and agree that the Company shall withhold from payments made to me, or I shall remit to
the Company, all amounts required to be withheld by the Company to satisfy federal and state tax withholding obligations with respect to the exercise of the Option. 
 (f) I agree that my certificate(s) for the Stock may bear legends to reflect the restrictions set forth herein and in the Agreement. The
agreements, representations, warranties and covenants made by me herein extend to and apply to all of the Stock of the Company issued to me pursuant to the Option. Acceptance by me of the certificate representing such Stock shall constitute a
confirmation that all such agreements, representations, warranties and covenants made herein shall be true and correct at such time. 

 I would like the Stock to be registered in the name(s) of ________________________________________
__________________________________ as _________________________________________________ (specify individual, joint tenants, tenants by the entireties with right of survivorship as at common law, for the benefit of, or other legal designation).

  

	
	 Very truly yours,

	
	   

  

			
	AGREED TO AND ACCEPTED:
	
	Valley Financial Corporation
		
	By:	 	  
		
	Its:	 	  

			
	
	Number of Shares
	Exercised:	 	  
	
	Number of Shares
	Remaining:Restricted Stock Agreement dated July 5, 2005

 EXHIBIT 10.21 
 VALLEY FINANCIAL CORPORATION 
 RESTRICTED STOCK
AGREEMENT 
 July 5, 2005 
 J. Randall Woodson 
 Valley Bank 
 Dear Randy,

 I am pleased to inform you that effective as of July 5, 2005, Valley Financial Corporation (the “Company”) approved a grant
to you of shares of Company common stock, subject to the restrictions described below (the “Restricted Shares”). The grant is subject to the terms and conditions of this letter agreement (the “Agreement”) and the Valley Financial
Corporation 2005 Key Employee Equity Award Plan (the “Plan”), a copy of which has been provided to you, receipt of which is hereby acknowledged. The terms of the Plan are incorporated into this Agreement by reference. In the case of any
inconsistency between the Plan and this Agreement, the terms of the Plan shall control. Any term used in this Agreement that is defined in the Plan shall have the same meaning given to that term in the Plan. 
 3. Restricted Stock Award. The Company shall transfer 2,000 Restricted Shares to you as of July 5, 2005, (the “Grant Date”). The
fair market value of the Restricted Shares as of the Grant Date has been determined by the Company to be $12.50 per share. You have the right to elect to include the value of the Restricted Shares in gross income in the year of transfer pursuant to
Internal Revenue Code section 83(b) by completing the “Election to Include Value of Restricted Property in Gross Income in Year of Transfer Under Code Section 83(b)” form (the “83(b) Election Form”), attached as Exhibit A to
this Agreement. 
 4. Restrictions. Except as provided in this Agreement, the Restricted Shares are nontransferable and are subject to
a substantial risk of forfeiture. Your interest in the Restricted Shares shall become transferable and non-forfeitable (“Vested”) as of the date provided in Section 3 of this Agreement (the “Vesting Date”), if you are an
employee of the Company as of the applicable Vesting Date and have been so employed throughout the period beginning on the date of this Agreement and ending on the applicable Vesting Date and all of the following conditions have been satisfied in
their entirety based on the Company’s financial statements for the years ending December 31, 2005, 2006 and 2007, respectively: 
  

	 	a)	The Company shall have total assets of at least $600,000,000.00 as of December 31, 2007; and 

	 	b)	The Company shall have achieved at least 15% average annual earnings per share growth year to year for each of the three fiscal years ending December 31, 2005, 2006 and 2007;
and 

  

	 	c)	The Company shall have at least a 15% return on average equity for fiscal year 2007. 

  

	 	d)	If any one of the above conditions are not satisfied in their entirety, the Restricted Shares will not vest and will be automatically forfeited on January 31, 2008

 3. Vesting 
 (a) Vesting Dates: January 31, 2008 
 (b) Death or Disability. If you die
or become Disabled (as defined below) before all of the Restricted Shares become Vested, all of the Restricted Shares shall be transferable and non-forfeitable as of the date of your death or Disability. For purposes of this Agreement, the term
“Disabled” or “Disability” means a condition resulting from bodily injury or disease that renders you unable to perform any and every duty pertaining to your employment with the Company. The Board of Directors of the Company, in
its sole discretion, will determine whether you are Disabled based on medical evidence and your eligibility for benefits under the long-term disability policy maintained by the Company, if any. The date of the Board of Director’s determination
will be considered your date of Disability for purposes of this Agreement. 
 (c) The Company, in its sole discretion, may
accelerate the vesting of your Restricted Shares. 
 4. Custody of Certificates. The Company shall retain custody of all stock
certificates evidencing Restricted Shares. You shall not be entitled to obtain custody of your stock certificate until you become Vested in your Restricted Shares. The stock certificate shall bear a legend referencing this Agreement and describing
the terms and conditions of the applicable restrictions on transfer. 
 5. Restrictions on Transfer of Restricted Shares. By signing
the Agreement, you agree that you will not sell or transfer your Vested Restricted Shares to a third party unless the Company does not agree to purchase such stock, as provided under Section 6 below, and the Company approves the sale to the
third party. As a consequence of the foregoing, the certificates for Restricted Shares shall contain a legend substantially in the following form: 
 The sale or other transfer of the Shares of Stock represented by this certificate, whether voluntary, involuntary or by operation of law, is subject to certain restrictions on transfer set forth in the 2005 Valley Financial Corporation Key
Employee Equity Plan, in the rules and administration procedures adopted pursuant to such Plan and in an Agreement dated April 27, 2005. A copy of the Plan, such rules and procedures and such Restricted Stock Agreement may be obtained from the
Secretary of Valley Financial Corporation. 

 6. Effect of Termination of Employment. If your employment with the Company terminates for any or
no reason (other than retirement, Disability or death), all Restricted Shares that are not then Vested shall be forfeited. You shall not be entitled to any payment for or compensation with respect to such unvested Restricted Shares. 
 7. Tax Liability and Income Tax Withholding. You agree as a condition of this Restricted Stock award to pay to the Company, or make arrangements
satisfactory to the Company regarding the payment to the Company of, the aggregate amount of any federal, state or local income taxes of any kind required by law to be withheld with respect to the Restricted Shares when the fair market value of the
Restricted Shares become taxable. You hereby authorize the Company to sell all or any part of the Restricted Shares if necessary to protect the Company from incurring a withholding tax liability. 
 8. Adjustments. If the number of outstanding shares of Company stock is increased or decreased as a result of a subdivision or consolidation of
shares, the payment of a stock dividend, stock split, or any other similar changes in capitalization, the number of Restricted Shares shall be appropriately adjusted by the Company, whose determination shall be binding. 
 9. Employment Rights. The award of Restricted Shares under this Agreement does not confer upon you any right to continue as an employee of the
Company or limit in any respect the right of the Company to terminate your employment. 
 10. Shareholder Rights. You will have the
right to receive dividends and distributions and will have the right to vote Restricted Shares, both unvested and Vested. If any such dividends or distributions are paid in share of the Company’s stock, the shares will be subject to the same
restrictions on transferability and the other provisions of this Agreement as are the Restricted Shares with respect to which they were distributed. 
 11. Governing Law. This Agreement shall be governed by the laws of Virginia. 
 12. Acceptance of
Award. You may accept this award and elect to receive the Restricted Shares by signing and returning the enclosed copy of this Agreement. Your signature will evidence your agreement to the terms and conditions set forth in this Agreement and the
Plan. This Agreement will not be effective until is signed and returned. 
 13. Entire Agreement, Amendment. This Agreement
constitutes the entire agreement between you and the Company and shall be binding upon your legatees, distributees, and personal representatives and the successors of the Company. This Agreement may only be amended by a writing signed by both you
and the Company. 
  

			
	 Valley Financial Corporation

		
	 By:
	 	 /s/ Ellis L. Gutshall

	 Its:
	 	 President / Chief Executive Officer

	 Date:
	 	 July 5, 2005

  

			
		
	 Signature:
	 	 /s/ J. Randall Woodson

 Exhibit A 
 VALLEY FINANCIAL CORPORATION 
 RESTRICTED STOCK AWARD

 Election to Include Value of Restricted Property in Gross Income 
 in Year of Transfer Under Code Section 83(b) 
 The undersigned hereby
elects to have the provisions of Section 83(b) of the Internal Revenue Code of 1986, as amended (the “Code”), apply to purchases and grants of the property described below. The undersigned provides the following information in
accordance with Treasury Regulation Section 1.83-2: 
 1. The name, address and taxpayer identification number of the undersigned
are: 
  

					
		  	Name_________________________________________	  	
			
		  	Address_______________________________________	  	
			
		  	_____________________________________________	  	
			
		  	Social Security No. ________-________-_____________	  	

 2. Description of property with respect to which the election is being made:

 __________ shares of restricted common stock of Valley Financial Corporation (the “Company”) awarded to
the taxpayer pursuant to an Agreement between the taxpayer and the Company dated as of _____________, 2005. 
 3. The date on which
property is transferred and the taxable year for which the election is made: 
 The shares of restricted stock were
awarded and transferred to the taxpayer as of _____________, 2005. The taxable year to which this election relates is calendar year 2005. 
 4. The nature of the restriction(s) to which the property is subject: 
 The shares of restricted stock
are forfeitable and not transferable until the Vesting date and only then if all of the conditions set forth in Section 2 off the Restricted Stock Agreement have occurred or been satisfied. 
 5. Fair market value: 
 The aggregate fair market value of shares of restricted common stock subject to this election, as described in Section 2 above (determined with regard to nonlapse restrictions only), is
$                    . 
 6.
Amount paid for property: 
 Except for services to be rendered, no consideration was paid for the shares of
restricted stock. 

 7. Furnishing statement to employer: 
 A copy of this statement has been furnished to Valley Financial Corporation. 
  

	
	 Dated: ___________________

	
	 ________________________

	 Signature

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