Document:

ex_134903.htm

 

Exhibit 10.6

 

 

option GRANT AGREEMENT

under the

UNITED BANCSHARES, INC.

2018 STOCK OPTION PLAN

 

This Agreement, dated this ___ day of ____, 20__, (the “Grant Date”) by and between United Bancshares, Inc., an Ohio corporation, (the “Company”) and [employee] (herein the “Eligible Person”).

 

	
			1.

				
			Grant of Option. Subject to the provisions of the United Bancshares, Inc. 2016 Stock Option Plan (the “Plan”), which is incorporated herein by reference, Options (the “Options”) for a total of ______ (____) Shares, are hereby granted to the Eligible Person.

			

 

	
			2.

				
			Option Price. The Fair Market Value of one Share on the date of this Agreement is ____ dollars and ____ cents ($____). The Option price for the Options granted under paragraph 1 shall be equal to the Fair Market Value described in the preceding sentence.

			

 

	
			3.

				
			Terms and Conditions.

			

 

	 	
			a.

				
			Employee Status and Vesting. Provided the Eligible Person is an employee of the Company on such dates, a portion of the Options granted herein shall vest and be exercisable on each anniversary of the Grant Date, as follows:

			

 

	Years after the Grant Date	 	Vested Percentage	 
	 	 	 	 
	1 year	 	33.33%	 
	2 years	 	33.33%	 
	3 years	 	33.34%	 

 

 

	 	
			b.

				
			Expiration Date. Any Options which are vested and not exercised within 10 years from the date of the grant or _______, 20__ shall be deemed expired and no longer exercisable by the Eligible Person.

			

 

	 	
			c.

				
			Change of Control.  Notwithstanding the provisions of subparagraph a, during the period beginning three months prior to the effective date of any Change of Control and ending on the first anniversary of such a Change of Control, one hundred percent (100%) of the Options granted herein which have then been outstanding hereunder for at least six months and which remain outstanding hereunder shall vest and be exercisable by the Eligible Person in the event that: (i) the Company Terminates Employment of the Eligible Person involuntarily for any reason other than Cause, or (ii) the Eligible Person Terminates Employment voluntarily for any Good Reason.

			

 

	 	
			d.

				
			Employment Status. The Eligible Person is an employee of the Company as of the date of this Agreement.

			

 

 

 

 

	
			4.

				
			Non-Solicitation of Customers and Employees. Employee covenants and agrees that, during Employee’s employment and for a period of one (1) year after the voluntary or involuntary termination of Employee’s employment with the Company, for any reason, or for no reason (the “Restricted Period”):

			

 

	 	
			a.

				
			Employee shall not directly or indirectly solicit or seek business from any person or entity which is a customer of the Company or actively-sought prospective customer of the Company during Employee’s employment (“respective customers”). Employee further agrees that Employee shall not induce, or assist others to induce, any customer of the Company to terminate its association with the Company, or cease to do business in whole or in part with the Company, or do anything, directly or indirectly, to interfere with the business relationship between the Company and any of its respective customers.

			
	 	 	 
	 	b.	Employee also covenants and agrees that, during the Restricted Period, Employee shall not solicit or encourage, directly or indirectly, then-current employees of the Company to terminate their employment with the Company, nor shall Employee hire, solicit, or encourage, directly or indirectly, then-current employees of the Company to become employed by, or perform services for, a person or entity engaged in a business which provides services competitive to the Company. Employee further agrees that Employee shall not induce, or assist others to induce, any employee, agent, representative or other person associated with the Company to terminate his or her association or business relationship with the Company during the Restricted Period.

 

	
			5.

				
			Payments. Payment of the Option price upon exercise of any Option granted hereunder shall be made in accordance with the terms of the Plan in cash (or in such other manner permitted under the Plan and approved by the Committee).

			

 

	
			6.

				
			Exercise Notice. The Eligible Person, or other person who may be entitled to exercise the Option, may serve notice to the Company of his intention to voluntarily exercise any Option which has become vested. This notice shall be in writing, in a format acceptable to the Company, shall specify the proposed exercise date, the number of Options which are to be exercised, and shall identify such Options by date of the grant.

			

 

	
			7.

				
			Expiration Date. This Agreement shall be effective as of the date first set forth above. The Options granted under this Agreement shall expire on the earlier of: (i) the date after which the Options may no longer be exercised under the terms of the Plan, or (ii) the expiration date specified in paragraph 3, subparagraph (b) of this Agreement.

			

 

	
			8.

				
			Eligible Person Bound by Plan. The Eligible Person hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms and provisions thereof. The Eligible Person hereby accepts the Options granted herein and the Shares received upon exercise thereof subject to all the terms and provisions of the Plan. The Eligible Person hereby agrees to accept as binding, conclusive, and final all decisions and interpretations of the Committee upon any questions arising under the Plan. As a condition to the issuance of Shares under these Options, the Eligible Person agrees to remit to the Company at the time of any exercise of the Options any taxes required to be withheld by the Company under Federal, State, or local law as a result of the exercise of the Options. Capitalized terms not defined in this Agreement shall have the same meaning set forth in the Plan.

			

 

2

 

 

	
			9.

				
			Notices. Any notice hereunder to the Company shall be addressed to it at its office at 105 Progressive Drive, Columbus Grove, Ohio, 45830. Any notice hereunder to the Eligible Person shall be addressed to him at the address set forth below, subject to the right of either party to designate some other address.

			

 

	
			10.

				
			Limitations. The Options granted hereunder may not be exercised if the issuance of Shares upon such exercise would constitute a violation of any applicable Federal or State securities or other law or applicable regulation.

			

 

	
			11.

				
			Miscellaneous.

			

 

	 	
			a.

				
			The Eligible Person hereby agrees that this agreement shall be governed by the laws of the State of Ohio, without regard to such state’s conflict of law rules.

			

 

	 	
			b.

				
			The Eligible Person hereby agrees that if any provision of this shall be deemed unenforceable, the remaining provisions of this Agreement shall remain in full force and effect, and that the Eligible Person shall abide by those remaining provisions with the full intent of honoring the spirit of this Agreement, as if this Agreement was still fully intact.

			

 

 

	 	THE COMPANY
	 	 
	 	United Bancshares, Inc.
	 	 
	 	By:                                                    
	 	 
	 	Title:                                                  
	 	 
	 	ELIGIBLE PERSON
	 	 
	 	Signature: ________________________________
	 	 
	 	Address: _________________________________
	 	 
	 	_________________________________________

 

10789082v2

 

3ex_174766.htm

Exhibit 10.7

 

 

United Bancshares, inc.

CHANGE IN CONTROL AGREEMENt

 

THIS CHANGE IN CONTROL AGREEMENT ("Agreement") is made and entered into as of this 13th day of July, 2011, by and between United Bancshares, Inc., an Ohio corporation ("Holding Company"), The Union Bank Company, an Ohio state-chartered bank ("Bank") and Curtis Shepherd (the "Employee").

 

W I T N E S S E T H:

 

WHEREAS, the Employee is employed by the Bank; and

 

WHEREAS, the Bank and Holding Company recognize the possibility that a change in control of the Bank and/or Holding Company may occur and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of key management personnel to the detriment of the Bank, the Holding Company and their respective shareholders; and

 

WHEREAS, the Bank and Holding Company believe it is in the best interests of the Bank and Holding Company to enter into this Agreement with the Employee in order to assure continuity of management of the Bank and to reinforce and encourage the attention and dedication of the Employee to his assigned duties without distraction in the face of potentially disruptive circumstances arising from the possibility of a change in control of the Bank and/or Holding Company; and

 

WHEREAS, the Bank and the Holding Company has approved and authorized the execution of this Agreement with the Employee;

 

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements of the parties herein contained, it is agreed as follows:

 

1.     TERM. The term of this Agreement (the "Term") shall commence on the date first set forth above (the "Effective Date"), and shall terminate upon the earlier of: (i) the payment of all Change in Control Payments due to the Employee hereunder; or (ii) the termination of Employee’s employment under the circumstances described in Section 2 which would cause the Employee not to be eligible to receive a Change in Control payment hereunder.

 

2.     CHANGE IN CONTROL PAYMENT.

 

a.     Cause for Payment. In the event that Employee remains employed by the Bank on the closing date of any transaction constituting a Change in Control, or if the Employee’s employment by the Bank is terminated during a 90-day period prior to the closing date of any transaction constituting a Change in Control for any reason other than: (i) Cause; (ii) Employee’s voluntary termination of employment without Good Reason; or (iii) the Employee's death, Employee shall be entitled to receive the Change in Control Payment from the Bank as described in this Section.

 

 

 

 

b.     Amount of Change in Control Payment. Except as otherwise required by subparagraph c. below, the amount of the Change in Control Payment to be paid to the Employee shall be equal to 1.50 multiplied by the Employee's Base Amount.

 

c.     Reduction of Change in Control Payment. In the event the Employee is to receive other compensation or consideration, including, but not limited to, bonus payments or acceleration of vesting of equity incentives, which would be considered a parachute payment under Code section 280G and Treasury Regulations issued thereunder as a result of a Change in Control resulting in a payment pursuant to this Section 2, the Change in Control Payment made pursuant to subparagraph b. above shall be reduced such that the sum of such other parachute payments and the Change in Control Payment do not exceed 2.99 multiplied by the Employee's Base Amount.

 

d.     Timing of Change in Control Payment. The Change in Control Payment shall be paid to the Employee at or simultaneously with the closing or consummation of the transaction which constitutes the Change in Control; provided, however, that in no event shall the payment be made any later than March 15th of the calendar year immediately following the calendar year in which the Change in Control occurs.

3.     TERMINATION OF OTHER AGREEMENTS/AT-WILL EMPLOYMENT. This Agreement shall supersede any other agreement, oral, written, implied or otherwise, pertaining to the terms of employment of the Employee for the Bank and, if any such agreement previously exists, such agreement shall hereinafter be considered null and void. Nothing in this Agreement shall be construed to limit or impair the Bank's right to terminate Employee at will.

 

4.     DEFINITIONS. For the purposes of this Agreement, the following words and phrases shall have the meanings indicated:

 

a.     Base Amount. "Base Amount" shall have the same definition as is provided to that phrase under Code section 280G(b)(3)(A) and shall be interpreted in accordance with Treasury Regulations issued thereunder.

 

b.     Board. "Board" shall mean the Board of Directors of the Bank, or any individual or committee designated by the Board to perform its obligations hereunder.

 

c.     Cause. "Cause" shall mean, and is limited to, either:

 

	 	
			i.

				
			the continued willful refusal (other than a willful refusal resulting from Employee's incapacity due to physical or mental illness) by Employee to substantially perform such duties as are reasonably imposed on him by the Board;

			

 

	
			The Union Bank Company

				
			2

				 
	
			Change in Control Agreement

				 	 

 

 

 

	 	
			ii.

				
			the willful and continued engagement by Executive in conduct which Employee knows or reasonably should know is contrary to the best interests of the Bank, as reasonably determined by the Board;

			

 

	 	
			iii.

				
			Employee’s conviction of, or plea of nolo contendre to, a felony which involves moral turpitude or which materially impairs Employee’s ability to perform his duties with the Bank; or

			

 

	 	
			iv.

				
			the Employee willfully engaging in conduct which violates any applicable law, governmental regulation or governmental executive order, which could reasonably be expected to subject the Bank to a material penalty or substantial damages (for example, but without limitation thereto, sexual harassment or illegal discrimination).

			

 

d.        Change in Control. "Change in Control" means the occurrence of any of the events described in paragraphs (i), (ii), and (iii) of this definition. All of such events shall be determined under and, even if not so indicated in the following paragraphs of this definition, shall be subject to all of the terms of Section 1.409A-3(i)(5) of the Treasury Regulations.

 

	 	
			i.

				
			A change in the ownership of the Bank and/or Holding Company (within the meaning of Section 1.409A-3(i)(5)(v) of the Treasury Regulations). In very general terms, Section 1.409A-3(i)(5)(v) of the Treasury Regulations provides that a change in the ownership of the Bank and/or Holding Company occurs when a person or more than one person acting as a group acquires outstanding voting securities of the Bank and/or Holding Company that, together with stock held by such person or group, constitutes more than 50 percent of the total fair market value or total voting power of the stock of the Bank and/or Holding Company.

			

 

	 	
			ii.

				
			A change in the effective control of the Bank and/or Holding Company (within the meaning of Section 1.409A-3(i)(5)(vi) of the Treasury Regulations). In very general terms, Section 1.409A-3(i)(5)(vi) of the Treasury Regulations provides that a change in the effective control of the Bank and/or Holding Company occurs either:

			

 

A.     when a person or more than one person acting as a group acquires (or has acquired during the twelve-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Bank and/or Holding Company possessing 30% or more of the total voting power of the stock of the Bank and/or Holding Company; or

 

B.     when a majority of members of the board of directors of either the Bank and/or Holding Company is replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the members of the respective board prior to the date of the appointment or election.

 

	
			The Union Bank Company

				
			3

				 
	
			Change in Control Agreement

				 	 

 

 

 

	 	
			iii.

				
			A change in the ownership of a substantial portion of the assets of the Bank and/or Holding Company (within the meaning of Section 1.409A-3(i)(5)(vii) of the Treasury Regulations). In very general terms, Section 1.409A-3(i)(5)(vii) of the Treasury Regulations provides that a change in the ownership of a substantial portion of the assets of the Bank and/or Holding Company occurs when a person or more than one person acting as a group acquires (or has acquired during the twelve-month period ending on the date of the most recent acquisition by such person or persons) assets from the Bank and/or Holding Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets (determined without regard to any liabilities associated with such assets) of the Bank and/or Holding Company, respectively, immediately prior to such acquisition or acquisitions.

			

 

e.       Code. "Code" means the Internal Revenue Code of 1986, as amended.

 

f.       Disability. "Disability" means the Employee's physical or mental disability that prevents the performance by the Employee of the Employee’s duties with the Bank lasting (or likely to last, based on competent medical evidence presented to the Bank) for a continuous period of six months or longer. The reasoned and good faith judgment of the Bank as to whether the Participant has a Disability shall be final and shall be based on such competent medical evidence as shall be presented to it by the Employee or by any physician or group of physicians or other competent medical experts employed by the Employee or the Bank to advise the Bank.

 

g.       Good Reason. "Good Reason" shall mean, and is limited to:

 

	 	
			i.

				
			the voluntary termination of employment of the Employee within 90 days following:

			

 

A.      any assignment to the Employee of any duties, functions or responsibilities that are significantly different from, and result in a substantial and material diminution of, the duties, functions or responsibilities that the Employee has on the Effective Date;

 

B.     any requirement by the Bank that the Employee be based more than 50 miles from Columbus Grove, Ohio; or

 

C.      a reduction in base salary or employee benefits equal to 10% or more (other than in connection with a reduction generally applicable to similarly situated employees); or

 

	
			The Union Bank Company

				
			4

				 
	
			Change in Control Agreement

				 	 

 

 

 

ii.     termination resulting from the Disability of the Employee.

 

 

 

5.     MISCELLANEOUS.

 

a.     Obligation of the Bank. The Bank, and not the Board or any member thereof, shall be liable for any and all claims made in connection with this Agreement and for any and all payments to which Employee may be entitled under this Agreement. The Agreement shall be unfunded.

 

b.     Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto, the heirs and legal representatives of Employee, and the successors and assigns of the Bank, except that Employee may not assign this Agreement.

 

c.     Modification. This Agreement may not be changed, amended, or modified except by a writing signed by both parties; provided, however, that any obligation arising under this Agreement shall remain subject to the jurisdiction and ruling of any bank regulatory authority, including, but not limited to, the Federal Deposit Insurance Corporation and the Ohio Division of Financial Institutions, and upon a proper exercise of regulatory authority by such entity or agency the obligations in this Agreement will be decreased or eliminated so as to comply with the judgment and rulings of such entity or agency.

 

d.     Notices. Any notice, request, demand, waiver, consent, approval, or other communication which is required to be or may be given under this Agreement shall be in writing and shall be deemed given only if delivered to the party personally or sent to the party by a commercially reputable overnight delivery service, delivery charges prepaid, to the parties at the addresses set forth herein or to such other address as either party may designate from time to time by notice to the other party sent in like manner.

 

e.     Governing Law. This Agreement constitutes the entire agreement between the parties and shall be governed by and construed in accordance with the laws of the State of Ohio applicable to agreements made and to be performed solely within such state.

 

f.     Tax Liability. The Bank may withhold from any payment of benefits under this Agreement, or from any other compensation payable to the Employee by the Bank, such amounts as the Bank determines are reasonably necessary to pay any taxes (and interest thereon) required to be withheld under applicable law.

 

g.     Headings. The section headings contained in this Agreement are for reference purposes only and shall not be deemed to be a part of this Agreement or to affect the construction or interpretation of this Agreement.

 

	
			The Union Bank Company

				
			5

				 
	
			Change in Control Agreement

				 	 

 

 

 

h.     No Mitigation.   The Employee shall not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in this Agreement be reduced by any compensation earned by the Employee as the result of employment by another employer, by retirement benefits after the date of termination or otherwise.

 

i.     Confidentiality. This Agreement shall be confidential, and Employee agrees not to disclose the existence of this Agreement or its terms to anyone other than Employee’s attorney and Employee’s financial and tax advisors.

 

(signature page immediately follows)

 

	
			The Union Bank Company

				
			6

				 
	
			Change in Control Agreement

				 	 

 

 

 

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

 

	THE UNION BANK COMPANY	 	
			EMPLOYEE

				
			 

			
	 	
			 

				 	
			 

				
			 

				
			 

			
	 	
			 

				 	
			 

				
			 

				
			 

			
	By:	
			 

				 	
			 

				
			 

				
			 

			
	 	
			 

				 	
			 

				
			 

				
			 

			
	Its:	 	 	 	 	 
	 	 	 	 	 	 
	 	
			 

				 	
			 

				
			 

				
			 

			
	 	 	 	 	 	 
	UNITED BANCSHARES, INC.	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By:	 	 	 	 	 
	 	 	 	 	 	 
	Its:	 	 	 	 	 

 

 

	
			The Union Bank Company

				
			7

				 
	
			Change in Control Agreement

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