Document:

Exhibit 10.2(h)

 

[Form of
employee Incentive Stock Option Award Pursuant to 1996

Stock Incentive Plan

(for award granted
in paper)]

 

INCENTIVE
STOCK OPTION AWARD

PURSUANT
TO NETBANK, INC.

1996
STOCK INCENTIVE PLAN

 

THIS AWARD is made as of
the Grant Date by NETBANK, INC. (the “Company”) to                             
(the “Optionee”).

 

Upon and subject to the
Terms and Conditions attached hereto and incorporated herein by reference, the
Company hereby awards as of the Grant Date to Optionee an incentive stock
option (the “Option”), as described below, to purchase the Option Shares.

 

A.                                   Grant
Date:                           

 

B.                                     Type
of Option:  Incentive Stock Option, as
defined under Section 422(b) of the Internal Revenue Code of 1986, as
amended (the “Code”), granted pursuant to the NetBank 1996 Stock Incentive Plan
(the “Plan”).

 

C.                                     Option
Shares:  All or any part of                      
shares of the Company’s common stock, $.01 par value per share (“Common Stock”),
subject to adjustment as provided in the attached Terms and Conditions.

 

D.                                    Exercise
Price:  $                                      
per share of Common Stock, subject to adjustment as provided in the attached
Terms and Conditions.  The Exercise Price
is, in the judgment of the Committee, not less than 100% of the Fair Market
Value of a share of Common Stock as of the Grant Date or, in the case of an
Over 10% Owner, not less than 110% of the Fair Market Value of a share of
Common Stock on the Grant Date.

 

E.                                      Option
Period:  The Option may be exercised as
to all or any portion of the Vested Option Shares, but only during the Option
Period, which commences following the Grant Date and ends, generally, on the
earliest of (a) the tenth (10th) anniversary of the Grant Date; or (b) the
later of the date (i) ninety days (90) following the date the Optionee
ceases to be an employee of the Company for any reason other than death or
Disability, or (ii) twelve months following the date the Optionee ceases
to be an employee of the Company due to death or Disability; provided that the
Option may

 

 

be exercised as to no
more than the Vested Option Shares, determined pursuant to the Vesting
Schedule.  Note that
other limitations to exercising the Option, as described in the attached Terms
and Conditions, may apply.

 

 

F.                                      Vesting
Schedule:  The Option Shares shall become
vested in accordance with the attached Vesting Schedule.  All or a portion of the Option Shares may
become vested on an earlier date as provided in Section 3 and Section 7(b) of
the attached Terms and Conditions.

 

 

IN WITNESS WHEREOF, the
Company has executed and sealed this Award as of the Grant Date set forth
above.

 

 

	
   

  	
  NETBANK, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
				

 

 

VESTING
SCHEDULE

TO
NETBANK, INC.

1996
STOCK INCENTIVE OPTION AWARD

 

Vesting Schedule

 

“Vested Option Shares”
means only that percentage of Option Shares as to which the Option becomes
exercisable following completion of the years of service indicated in the schedule below:

 

	
  Percentage
  of Shares

  Which are Vested Option Shares

  	
   

  	
  Year(s) of Service

  after Grant Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  20

  	
  %

  	
   

  	
  Upon Grant

  	
   

  
	
  40

  	
  %

  	
   

  	
  1

  	
   

  
	
  60

  	
  %

  	
   

  	
  2

  	
   

  
	
  80

  	
  %

  	
   

  	
  3

  	
   

  
	
  100

  	
  %

  	
   

  	
  4

  	
   

  

 

1.                                                                                                                                       (a)                                  For
purposes of the Vesting Schedule, the Optionee shall be granted a year of
service for each consecutive anniversary following the Grant Date during which
the Optionee continues, at all times, as an employee of the Company or a
Subsidiary.

 

(b)                                 The
right of the Optionee to vest in the Option Shares shall cease upon the
termination of his or her service as an employee of the company and its
Subsidiaries, whether by reason of death, Disability or otherwise and,
thereafter, no further Option Shares shall become Vested Option Shares; and the
Option shall be exercisable only during the Option Period specified in the
Award.

 

 

TERMS AND
CONDITIONS TO THE

INCENTIVE
STOCK OPTION AWARD

PURSUANT
TO THE NETBANK, INC.

1996
STOCK INCENTIVE PLAN

 

1.                                       Exercise
of Option.  Subject to the provisions
provided herein or in the Award made pursuant to the Plan:

 

(a)                                  the
Option may be exercised with respect to all or any portion of the Vested Option
Shares at any time during the Option Period by the delivery to the Company, at
its principal place of business, of a written notice of exercise in
substantially the form of Exhibit 1 hereto, which notice shall be actually
delivered to the Company no earlier than thirty (30) days and no later than ten
(10) days prior to the date upon which Optionee desires to exercise all or
any portion of the Option; and

 

(b)                                 payment
to the Company of the Exercise Price multiplied by
the number of Option Shares being purchased (the “Purchase Price”) as
provided in Section 2; and

 

(c)                                  payment
of any tax withholding liability pursuant to Section 4 below.

 

Upon acceptance of such
notice and receipt of payment in full of the Purchase Price and tax withholding
liability, the Company shall cause to be issued a certificate representing the
Vested Option Shares purchased.

 

The Company may, from
time to time, establish other methods for exercise of Options, whether
electronically, through an agent or otherwise, as may be communicated to the
Optionee.

 

2.                                       Purchase
Price.  Payment of the Purchase Price
for all Vested Option Shares purchased pursuant to the exercise of an Option
shall be made in cash or certified check or, alternatively, as follows:

 

(a)                                  by
delivery to the Company of a number of shares of Common Stock which have been
owned by the Optionee for at least six (6) months prior to the date of the
Option’s exercise having a Fair Market Value, as determined under the Plan, on
the date of exercise either equal to the Purchase Price or in combination with
cash or a certified check to equal the Purchase Price; or

 

(b)                                 by
receipt of the Purchase Price in cash from a broker, dealer or other “creditor”
as defined by Regulation T issued by the Board of Governors of the Federal
Reserve System following delivery by the Optionee to the Committee of
instructions in a form acceptable to the Committee regarding delivery to such
broker, dealer or other creditor of that number of Option Shares with respect
to which the Option is exercised; or

 

 

(c)                                  any
combination of the foregoing.

 

3.                                       Vested
Option Shares.  The Option Shares
shall become Vested Option Shares in accordance with the Vesting Schedule;
provided, however, that all Option Shares may become Vested Option Shares in
accordance with Section 8(b) hereof.

 

4.                                       Withholding.  The Optionee must satisfy any federal, state
and local, if any, withholding taxes imposed by reason of the exercise of the
Option by paying to the Company the full amount of the withholding obligation
in cash or by certified check.  In lieu
of paying the withholding obligation in cash or by certified check, the
Optionee may elect (i) to tender to the Company the smallest number of
whole shares of Common Stock which have been owned by the Optionee for at least
six (6) months prior to the date of the Option’s exercise having a Fair
Market Value as of the date of the Option exercise, as determined under the
Plan, sufficient to satisfy the amount of the withholding tax; or (ii) irrevocably
electing to have the actual numbers of shares of Stock issuable upon exercise
reduced by the smallest number of whole shares of Stock which, when multiplied
by the Fair Market Value of the Common Stock as of the date the Option is
exercised, is sufficient to satisfy the amount of the withholding tax (either
election is referred to below as a “Withholding Election”).  The Optionee may make a Withholding Election
only if the following conditions are met:

 

(a)                                  the
Withholding Election is made on or prior to the date on which the amount of tax
required to be withheld is determined (the “Tax Date”) by executing and
delivering to the Company a properly completed Withholding Election; and

 

(b)                                 any
Withholding Election made will be irrevocable; however, the Committee may, in its
sole discretion, disapprove and give no effect to any Withholding Election.

 

5.                                       Incentive
Stock Option Status.  In the event
the aggregate Fair Market Value (determined as of the applicable grant date) of
shares of Common Stock subject to options (under all plans of the Company) that
first become exercisable in favor of the Optionee during any calendar year by
an amount that exceeds $100,000, then such options in excess of the limitation
shall not be Incentive Stock Options.  To
the extent such limitation affects all or any portion of the Option Shares,
those Option Shares shall be treated as nonqualified stock options.

 

6.                                       Rights
as Shareholder.  Until the stock
certificates reflecting the Option Shares accruing to the Optionee upon
exercise of the Option are issued to the Optionee, the Optionee shall have no
rights as a shareholder with respect to such Option Shares.  The Company shall make no adjustment for any
dividends or distributions or other rights on or with respect to Option Shares
for which the record date is prior to the issuance of that stock certificate,
except as the Plan or the attached Award otherwise provides.

 

7.                                       Restriction
on Transfer of Option and of Option Shares. 
The Option evidenced hereby is nontransferable other than by will or the
laws of descent and distribution and shall be exercisable

 

 

during the lifetime of
the Optionee only by the Optionee (or in the event of his disability, by his
personal representative) and after his death, only by his legatee or the
executor of his estate.

 

8.                                       Changes
in Capitalization.

 

(a)                                  The
number of Option Shares and the Exercise Price shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a subdivision or combination of shares or the payment of a
stock dividend in shares of Common Stock to holders of outstanding shares of
Common Stock or any other increase or decrease in the number of shares of
Common Stock outstanding effected without receipt of consideration by the
Company.

 

(b)                                 If
the Company shall be the surviving corporation in any merger or consolidation,
recapitalization, reclassification of shares or similar reorganization, the
Optionee shall be entitled to purchase or receive the number and class of
securities to which a holder of the number of shares of Common Stock subject to
the Option at the time of such transaction would have been entitled to receive
as a result of such transaction, and a corresponding adjustment shall be made
in the Exercise Price.  A dissolution or
liquidation of the Company shall cause the Option to terminate as to any
portion thereof not exercised as of the effective date of the dissolution or
liquidation.  In the event of a sale of
substantially all of the Common Stock or property of the Company or the merger
or consolidation or any other reorganization, including a Change in Control of
the Company in which the Company is not the surviving entity, the Option Shares
shall become fully vested on the date determined by the Committee prior to the
effective date of the Change in Control, but no less than thirty (30) days
prior to the effective date of the Change in Control.

 

(c)                                  The
existence of the Plan and the Option granted pursuant to this Award shall not
affect in any way the right or power of the Company to make or authorize any
adjustment, reclassification, reorganization or other change in its capital or
business structure, any merger or consolidation of the Company, any issue of
debt or equity securities having preferences or priorities as to the Common
Stock or the rights thereof, the dissolution or liquidation of the Company, any
sale or transfer of all or any part of its business or assets, or any other
corporate act or proceeding. Any adjustment pursuant to this Section may
provide, in the Committee’s discretion, for the elimination without payment
therefor of any fractional shares that might otherwise become subject to any
Option.

 

9.                                       Special
Limitation of Exercise.  No purported
exercise of the Option shall be effective without the approval of the
Committee, which may be withheld to the extent that the exercise, either
individually or in the aggregate together with the exercise of other previously
exercised stock options and/or offers and sales pursuant to any prior or
contemplated offering of securities, would, in the sole and absolute judgment
of the Committee, require the filing of a registration statement with the
United States Securities and Exchange Commission or with the securities
commission of any state.  If a
registration statement is not in effect under the Securities Act of 1933 or any
applicable state securities law with respect to shares of Common Stock
purchasable

 

 

or otherwise deliverable
under the Option, the Optionee (a) shall deliver to the Company, prior to
the exercise of the Option or as a condition to the delivery of Common Stock
pursuant to the exercise of an Option exercise, such information,
representations and warranties as the Company may reasonably request in order
for the Company to be able to satisfy itself that the Option Shares are being
acquired in accordance with the terms of an applicable exemption from the
securities registration requirements of applicable federal and state securities
laws and (b) shall agree that the shares of Common Stock so acquired will
not be disposed of except pursuant to an effective registration statement,
unless the Company shall have received an opinion of counsel that such
disposition is exempt from such requirement under the Securities Act of 1933
and any applicable state securities law.

 

10.                                 Legend
on Stock Certificates.  Certificates
evidencing the Option Shares, to the extent appropriate at the time, shall have
noted conspicuously on the certificates a legend intended to give all persons
full notice of the existence of the conditions, restrictions, rights and
obligations set forth herein and in the Plan.

 

11.                                 Governing
Laws.  This Award and the Terms and
Conditions shall be construed, administered and enforced according to the laws
of the State of Georgia.

 

12.                                 Successors.  This Award and the Terms and Conditions shall
be binding upon and inure to the benefit of the heirs, legal representatives,
successors and permitted assigns of the Optionee and the Company.

 

13.                                 Notice.  Except as otherwise specified herein, all
notices and other communications under this Award shall be in writing and shall
be deemed to have been given if personally delivered or if sent by registered
or certified United States mail, return receipt requested, postage prepaid,
addressed to the proposed recipient at the last known address of the
recipient.  Any party may designate any
other address to which notices shall be sent by giving notice of the address to
the other parties in the same manner as provided herein.

 

14.                                 Severability.  In the event that any one or more of the
provisions or portion thereof contained in the Award and these Terms and
Conditions shall for any reason be held to be invalid, illegal or unenforceable
in any respect, the same shall not invalidate or otherwise affect any other
provisions of the Award and these Terms and Conditions, and the Award and these
Terms and Conditions shall be construed as if the invalid, illegal or
unenforceable provision or portion thereof had never been contained herein.

 

15.                                 Entire
Agreement.  Subject to the terms and
conditions of the Plan, the Award and the Terms and Conditions express the
entire understanding of the parties with respect to the Option.

 

16.                                 Violation.  Any transfer, pledge, sale, assignment, or
hypothecation of the Option or any portion thereof shall be a violation of the
terms of the Award or these Terms and Conditions and shall be void and without
effect.

 

 

17.                                 Headings
and Capitalized Terms.  Section headings
used herein are for convenience of reference only and shall not be considered
in construing the Award or these Terms and Conditions.  Capitalized terms used, but not defined, in
either the Award or the Terms and Conditions shall be given the meaning
ascribed to them in the Plan.

 

18.                                 Specific
Performance.  In the event of any
actual or threatened default in, or breach of, any of the terms, conditions and
provisions of the Award and these Terms and Conditions, the party or parties
who are thereby aggrieved shall have the right to specific performance and
injunction in addition to any and all other rights and remedies at law or in
equity, and all such rights and remedies shall be cumulative.

 

19.                                 No
Right to Continued Retention. 
Neither the establishment of the Plan nor the award of Option Shares
hereunder shall be construed as giving the Optionee the right to continued
employment with the Company or any affiliate.

 

EXHIBIT 1

 

NOTICE OF
EXERCISE OF

STOCK
OPTION TO PURCHASE

COMMON
STOCK OF

NETBANK,
INC.

 

	
   

  	
  Name

  	
   

  	
   

  
	
   

  	
  Address

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date

  	
   

  	
   

  
						

 

NetBank, Inc.

Royal Centre Three, Suite 100

11475 Great Oaks Parkway

Alpharetta, Georgia  30022

 

Attention:                                         President

 

Re:                               Exercise
of Incentive Stock Option

 

Gentlemen:

 

 

Subject to acceptance
hereof by NetBank, Inc. (the “Company”), pursuant to the provisions of the
NetBank, Inc. 1996 Stock Incentive Plan (the “Plan”), I hereby give notice
of my election to exercise options granted to me to purchase                          
shares of common stock of the Company (“Common Stock”) under the Incentive
Stock Option Award (the “Award”) dated as of                                            .  The purchase shall take place as of                                             ,
200     (the “Exercise Date”).

 

On or before the Exercise
Date, I will pay the applicable purchase price as follows:

 

o                                    by
delivery of cash or a certified check for $                     
for the full purchase price payable to the order of NetBank, Inc.

 

o                                    by
delivery of cash or a certified check for $                     
representing a portion of the purchase price with the balance to consist of
shares of Common Stock that I have owned for at least six months and that are
represented by a stock certificate I will surrender to the Company with my
endorsement.  If the number of shares of
Common Stock represented by such stock certificate exceed the number to be
applied against the purchase price, I understand that a new stock certificate
will be issued to me reflecting the excess number of shares.

 

o                                    by
delivery of a stock certificate representing shares of Common Stock that I have
owned for at least six months which I will surrender to the Company with my
endorsement as payment of the purchase price. 
If the number of shares of Common Stock represented by such certificate
exceed the number to be applied against the purchase price, I understand that a
new certificate will be issued to me reflecting the excess number of shares.

 

o                                    by
delivery of the purchase price by                                                   ,
a broker, dealer or other “creditor” as defined by Regulation T issued by
the Board of Governors of the Federal Reserve System.  I hereby authorize the Company to issue a
stock certificate for the number of shares indicated above in the name of said
broker, dealer or other creditor or its nominee pursuant to instructions
received by the Company and to deliver said stock certificate directly to that
broker, dealer or other creditor (or to such other party specified in the
instructions received by the Company from the broker, dealer or other creditor)
upon receipt of the purchase price.

 

As soon as the stock
certificate is registered in my name, please deliver it to me at the above
address.

 

If the Common Stock being
acquired is not registered for issuance to and resale by the Optionee pursuant
to an effective registration statement on Form S-8 (or successor form)
filed under the Securities Act of 1933, as amended (the “1933 Act”), I hereby
represent, warrant, covenant, and agree with the Company as follows:

 

10

 

The shares of the Common Stock
being acquired by me will be acquired for my own account without the
participation of any other person, with the intent of holding the Common Stock
for investment and without the intent of participating, directly or indirectly,
in a distribution of the Common Stock and not with a view to, or for resale in
connection with, any distribution of the Common Stock, nor am I aware of the
existence of any distribution of the Common Stock;

 

I am not acquiring the
Common Stock based upon any representation, oral or written, by any person with
respect to the future value of, or income from, the Common Stock but rather
upon an independent examination and judgment as to the prospects of the
Company;

 

The Common 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 Common Stock, including the risk of a
complete loss of my investment therein;

 

I understand and agree
that the Common Stock will be issued and sold to me without registration under
any state law relating to the registration of securities for sale, and will be
issued and sold in reliance on the exemptions from registration under the 1933 Act,
provided by Sections 3(b) and/or 4(2) thereof and the rules and
regulations promulgated thereunder;

 

The Common Stock cannot
be offered for sale, sold or transferred by me other than pursuant to: (A) an
effective registration under the 1933 Act or in a transaction otherwise in
compliance with the 1933 Act; and (B) evidence satisfactory to the Company
of compliance with the applicable securities laws of other jurisdictions.  The Company shall be entitled to rely upon an
opinion of counsel satisfactory to it with respect to compliance with the above
laws;

 

The Company will be under
no obligation to register the Common Stock or to comply with any exemption
available for sale of the Common Stock without registration or filing, and the
information or conditions necessary to permit routine sales of securities of
the Company under Rule 144 under the 1933 Act are not now available and no
assurance has been given that it or they will become available.  The Company is under no obligation to act in
any manner so as to make Rule 144 available with respect to the Common
Stock;

 

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 Common Stock is a speculative

 

11

 

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 and data with
respect to the Company which I have requested and which I 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 Common Stock hereunder and I am
able to bear the economic risk of such purchase; and

 

The agreements,
representations, warranties and covenants made by me herein extend to and apply
to all of the Common Stock of the Company issued to me pursuant to this
Award.  Acceptance by me of the
certificate representing such Common Stock shall constitute a confirmation by
me that all such agreements, representations, warranties and covenants made
herein shall be true and correct at that time.

 

I understand that the
certificates representing the shares being purchased by me in accordance with
this notice shall bear a legend referring to the foregoing covenants,
representations and warranties and restrictions on transfer, and I agree that a
legend to that effect may be placed on any certificate which may be issued to
me as a substitute for the certificates being acquired by me in accordance with
this notice.  I further understand that
capitalized terms used in this Notice of Exercise without definition shall have
the meanings given to them in the Plan.

 

 

	
  Very truly yours,

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  
	
   

  
	
  AGREED TO AND ACCEPTED:

  
	
   

  
	
  NETBANK, INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
						

 

12

 

	
  Number of Shares:

  
	
  Exercised:

  	
   

  	
   

  
	
   

  
	
  Number of Shares
  Remaining:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
							

 

13Exhibit 10.2(i)

 

Form of
Restricted Stock Award Agreement Pursuant to 1996

Stock Incentive
Plan

 

NETBANK,
INC.

RESTRICTED
STOCK AWARD

 

This RESTRICTED STOCK AWARD (the “Award”) is made
and entered into as of the          day
of                         ,
                
by and between NetBank, Inc. (the “Company”), a Georgia corporation, and                                                      
(the “Employee”).

 

Upon and subject to the Additional Terms and
Conditions attached hereto and incorporated herein by reference as part of this
Award, the Company hereby awards as of the Grant Date to the Employee the
Restricted Shares described below pursuant to the NetBank, Inc. 1996 Stock
Incentive Plan (the “Plan”) in consideration of the Employee’s services to the
Company (the “Restricted Stock Grant”).

 

A.                                   Grant Date:                                          ,
                   .

 

B.                                     Restricted Shares:                               
shares of the Company’s common stock (“Common Stock”), par value $.01.

 

C.                                     Vesting Schedule:  The Restricted Shares shall vest
according to the Vesting Schedule attached hereto as Schedule 1
hereto (the “Vesting Schedule”).  The
Restricted Shares which have become vested pursuant to the Vesting Schedule are
herein referred to as the “Vested Restricted Shares.” The unvested Restricted
Shares determined as of the Employee’s Termination of Service will be forfeited
back to the Company.

 

IN WITNESS WHEREOF, the Company has signed and
sealed this Award as of the Grant Date set forth above.

 

	
   

  	
  NETBANK, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
  ATTEST:

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
  [CORPORATE SEAL]

  	
   

  	
   

  
								

 

 

ADDITIONAL TERMS AND CONDITIONS OF

NETBANK, INC.

RESTRICTED STOCK AWARD

 

1.                                       Condition
to Delivery of Restricted Shares.

 

(a)                                  Employee
must deliver to the Company, within thirty (30) days after the earlier of (i) the
date on which any Restricted Shares become Vested Restricted Shares, or (ii) the
making of an election pursuant to Code Section 83(b) as to all or any
portion of the Restricted Shares, either cash or a certified check payable to
the Company in the amount of all tax withholding obligations (whether federal,
state or local), imposed on the Company by reason of the vesting of the
Restricted Shares, or the making of an election pursuant to Code Section 83(b),
as applicable, except as provided in Section 1(b).

 

(b)                                 If
the Employee does not make an election pursuant to Code Section 83(b), in
lieu of paying the withholding tax obligation in cash or by certified check as
described in Section 1(a), Employee may elect to have the actual number of
Vested Restricted Shares reduced by the smallest number of whole shares of
Common Stock which, when multiplied by the Fair Market Value of the Common
Stock on the Vesting Date as determined by the Board of Directors, is
sufficient to satisfy the amount of the tax withholding obligations imposed on
the Company by reason of the vesting of the Restricted Shares (the “Withholding
Election”). Employee may make a Withholding Election only if all of the
following conditions are met:

 

(i)                                     the
Withholding Election must be made on or prior to the date on which the amount
of tax required to be withheld is determined (the “Tax Date”) by executing and
delivering to the Company a properly completed Notice of Withholding Election,
in substantially the form of Exhibit A attached hereto; and

 

(ii)                                    any
Withholding Election made will be irrevocable; however, the Board of Directors
may, in its sole discretion, disapprove and give no effect to any Withholding
Election.

 

2.                                       Restricted
Shares Held by the Share Custodian. 
Employee hereby authorizes and directs the Company to deliver any share
certificate issued by the Company to evidence Restricted Shares to the
Secretary of the Company or such other officer of the Company as may be designated
by the Committee (the “Share Custodian”) to be held by the Share Custodian
until the Restricted Shares become Vested Restricted Shares in accordance with
the Vesting Schedule.  When the
Restricted Shares become Vested Restricted Shares, the Share Custodian shall
deliver the Restricted Shares to the Employee. 
In the event that the Employee forfeits any of the Restricted Shares,
and the number of Vested Restricted Shares includes a fraction of a share, the
Share Custodian shall not be required to deliver the fractional share, and the
Company may pay the Employee the amount determined by the Company to be the
estimated fair market value therefor. 
Employee hereby irrevocably appoints the Share Custodian, and any successor
thereto, as the true and lawful attorney-in-fact of Employee with full power
and authority to execute any

 

2

 

stock transfer power or
other instrument necessary to transfer the Restricted Shares to the Company in
accordance with this Award, in the name, place, and stead of the Employee.  The term of such appointment shall commence
on the date of the Restricted Stock Grant and shall continue until the
Restricted Shares are delivered to the Employee as provided above.  During the period that the Share Custodian
holds the shares of Common Stock subject to this Section 2, the Employee
shall be entitled to all rights applicable to shares of Common Stock not so
held, except as provided in this Award. 
In the event the number of shares of Common Stock is increased or
reduced by a change in the par value, split-up, stock split, reverse stock
split, reclassification, merger, reorganization, consolidation, or otherwise,
and in such shares of Common Stock, the Employee agrees that any certificate representing
shares of Common Stock or other securities of the Company issued as a result of
any of the foregoing shall be delivered to the Share Custodian and shall be
subject to all of the provisions of this Award as if initially granted
thereunder.

 

3.                                       Dividends.  The Employee shall be entitled to dividends
paid on all Restricted Shares as and when declared and paid.

 

4.                                       Restrictions
on Transfer of Restricted Shares.

 

(a)                                  General
Restrictions.  Except as provided by
this Award, the Employee shall not have the right to make or permit to exist
any transfer or hypothecation, whether outright or as security, with or without
consideration, voluntary or involuntary, of all or any part of any right, title
or interest in or to any Restricted Shares. 
Any such disposition not made in accordance with this Award shall be
deemed null and void.  The Company will
not recognize, or have the duty to recognize, any disposition not made in
accordance with the Plan and this Award, and any Restricted Shares so
transferred will continue to be bound by the Plan and this Award.  The Employee (and any subsequent holder of
Restricted Shares) may not sell, pledge or otherwise directly or indirectly
transfer (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) any interest in or any beneficial
interest in any Restricted Shares except pursuant to the provisions of this
Award.  Any sale, pledge or other
transfer (or any attempt to effect the same) of any Restricted Shares in
violation of any provision of the Plan or this Award shall be void, and the
Company shall not record such transfer, assignment, pledge or other disposition
on its books or treat any purported transferee of such Restricted Shares as the
owner of such Restricted Shares for any purpose.

 

(b)                                 Certain
Permitted Transfers.  The
restrictions contained in this Section 4 will not apply with respect to
transfers of the Restricted Shares pursuant to applicable laws of descent and
distribution; provided that the restrictions
contained in this Section 4 will continue to be applicable to the
Restricted Shares after any such transfer; and provided
further that the transferees of such the Restricted Shares must
agree in writing to be bound by the provisions of the Plan and this Award.

 

3

 

5.                                       Additional
Restrictions on Transfer.

 

(a)                                  In
addition to any legends required under applicable securities laws, the
certificates representing the Restricted Shares shall be endorsed with the
following legend and the Employee shall not make any transfer of the Restricted
Shares without first complying with the restrictions on transfer described in
such legend:

 

TRANSFER IS
RESTRICTED

 

THE SECURITIES EVIDENCED
BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER AND FORFEITURE
PROVISIONS WHICH ALSO APPLY TO THE TRANSFEREE AS SET FORTH IN A RESTRICTED
STOCK AWARD, DATED
                    ,
A COPY OF WHICH IS AVAILABLE FROM THE COMPANY.

 

(b)                                 Opinion
of Counsel.  No holder of Restricted
Shares may sell, transfer, assign, pledge or otherwise dispose of (whether with
or without consideration and whether voluntarily or involuntarily or by
operation of law) any interest in or any beneficial interest in any Restricted
Shares, except pursuant to an effective registration statement under the
Securities Act of 1933, as amended (the “Securities Act”), without first
delivering to the Company an opinion of counsel (reasonably acceptable in form
and substance to the Company) that neither registration nor qualification under
the Securities Act and applicable state securities laws is required in
connection with such transfer.

 

6.                                       Change
in Capitalization.

 

(a)                                  The
number and kind of Restricted Shares shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a subdivision or combination of shares or the payment of a stock dividend
in shares of Common Stock to holders of outstanding shares of Common Stock or
any other increase or decrease in the number of shares of Common Stock
outstanding is effected without receipt of consideration by the Company.  No fractional shares shall be issued in
making such adjustment.  All adjustments made
by the Committee under this Section shall be final, binding, and conclusive.

 

(b)                                 In
the event of a merger or consolidation, extraordinary dividend (including a
spin-off), reorganization or other change in the corporate structure of the
Company or a tender offer for shares of Common Stock, an appropriate adjustment
may be made with respect to the Restricted Shares such that other securities,
cash or other property may be substituted for the Common Stock held by the
Employee pursuant to the Restricted Stock Grant.

 

(c)                                  The
existence of the Plan and the Restricted Stock Grant shall not affect the right
or power of the Company to make or authorize any adjustment, reclassification,
reorganization or other change in its capital or business structure, any merger
or consolidation of the Company, any issue of debt or equity securities having
preferences

 

4

 

or priorities as to the
Common Stock or the rights thereof, the dissolution or liquidation of the
Company, any sale or transfer of all or part of its business or assets, or any
other corporate act or proceeding.

 

7.                                       Governing
Laws.  This Award shall be construed,
administered and enforced according to the laws of the State of Georgia;
provided, however, no Restricted Shares shall be issued except, in the
reasonable judgment of the Committee, in compliance with exemptions under
applicable state securities laws of the state in which the Employee resides,
and/or any other applicable securities laws.

 

8.                                       Successors.  This Award shall be binding upon and inure to
the benefit of the heirs, legal representatives, successors, and permitted
assigns of the parties.

 

9.                                       Notice.  Except as otherwise specified herein, all
notices and other communications under this Award shall be in writing and shall
be deemed to have been given if personally delivered or if sent by registered
or certified United States mail, return receipt requested, postage prepaid,
addressed to the proposed recipient at the last known address of the
recipient.  Any party may designate any
other address to which notices shall be sent by giving notice of the address to
the other parties in the same manner as provided herein.

 

10.                                 Severability.  In the event that any one or more of the
provisions or portion thereof contained in this Award shall for any reason be
held to be invalid, illegal, or unenforceable in any respect, the same shall
not invalidate or otherwise affect any other provisions of this Award, and this
Award shall be construed as if the invalid, illegal or unenforceable provision
or portion thereof had never been contained herein.

 

11.                                 Entire
Agreement.  Subject to the terms and
conditions of the Plan, this Award expresses the entire understanding and
agreement of the parties with respect to the subject matter.  This Award may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.

 

12.                                 Violation.  Any disposition of the Restricted Shares or
any portion thereof shall be a violation of the terms of this Award and shall
be void and without effect.

 

13.                                 Headings
and Capitalized Terms.  Paragraph
headings used herein are for convenience of reference only and shall not be
considered in construing this Award. 
Capitalized terms used, but not defined, in this Award shall be given
the meaning ascribed to them in the Plan

 

14                                    Specific
Performance.  In the event of any
actual or threatened default in, or breach of, any of the terms, conditions and
provisions of this Award, the party or parties who are thereby aggrieved shall
have the right to specific performance and injunction in addition to any and
all other rights and remedies at law or in equity, and all such rights and
remedies shall be cumulative.

 

5

 

15.                                 No
Right to Continued Retention. 
Neither the establishment of the Plan nor the award of Restricted Shares
hereunder shall be construed as giving Employee the right to any continued
service relationship with the Company.

 

6

 

EXHIBIT A

 

NOTICE OF
WITHHOLDING ELECTION

NETBANK,
INC.

1996
STOCK INCENTIVE PLAN

 

	
  TO:

  	
  NetBank, Inc.

  
	
   

  	
   

  
	
  FROM:

  	
   

  
	
   

  	
   

  
	
  RE:

  	
  Withholding Election

  

 

This election relates to
the Restricted Stock Grant identified in Paragraph 3 below.  I hereby certify that:

 

(1)                                  My correct name and social security number and my
current address are set forth at the end of this document.

 

(2)                                  I am (check one, whichever is applicable).

 

o                                    the original
recipient of the Restricted Stock Grant.

 

o                                    the
legal representative of the estate of the original recipient of the Restricted
Stock Grant.

 

o                                    a legatee of the
original recipient of the Restricted Stock Grant.

 

o                                    the
legal guardian of the original recipient of the Restricted Stock Grant.

 

(3)                                  The Restricted Stock Grant pursuant to which this
election relates was issued under the NetBank, Inc. 1996 Stock Incentive
Plan (the “Plan”) in the name of                    
for a total of                     
shares of Common Stock.  This election
relates to               
shares of Common Stock issued upon the vesting of the Restricted Shares,
provided that the numbers set forth above shall be deemed changed as
appropriate to reflect stock splits and other adjustments contemplated by the
applicable Plan provisions.

 

(4)                                  I hereby elect to have certain of the shares
withheld by the Company for the purpose of having the value of the shares
applied to pay federal, state and local, if any, taxes arising from the
exercise.

 

The fair market value of the shares to be withheld
in addition to $                    
in cash to be tendered to the Company by the recipient of the Restricted Stock
Grant shall be equal to the minimum statutory tax withholding requirement under
federal, state and local law in connection with the exercise.

 

1

 

(5)                                  This Withholding Election is made no later than the
Tax Date and is otherwise timely made pursuant to the Plan.

 

(6)                                  I understand that this Withholding Election is made
prior to the Tax Date and is otherwise timely made pursuant to Section 1
of this Award and Section 5.1 of the Plan.

 

(7)                                  I further understand that, if this Withholding
Election is not disapproved by the Committee, the Company shall withhold from
the Common Stock a whole number of shares of Common Stock having the value
specified in Paragraph 4 above.

 

(8)                                  The plan has been made available to me by the
Company, I have read and understand the Plan and I have no reason to believe
that any of the conditions therein to the making of this Withholding Election
have not been met.  Capitalized terms
used in this Notice of Withholding Election without definition shall have the
meanings given to them in the Plan.

 

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name (Printed)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Street Address

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  City, State, Zip Code

  	
   

  
						

 

2

 

SCHEDULE 1

 

NETBANK,
INC.

1996
STOCK INCENTIVE PLAN

RESTRICTED
STOCK AWARD

 

Vesting Schedule

 

I.                                         The
Restricted Shares shall become vested in accordance with the following Vesting
Schedule:

 

	
   

  	
   

  	
  Percentage of Restricted Shares

  
	
  Years
  of Vesting Service

  	
   

  	
  which are Vested Restricted Shares

  
	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  25

  	
  %

  
	
  2

  	
   

  	
  50

  	
  %

  
	
  3

  	
   

  	
  75

  	
  %

  
	
  4

  	
   

  	
  100

  	
  %

  

 

II.                                     The
Employee shall receive one Year of Vesting Service for each full consecutive
one-year period beginning with the Grant Date and ending on the date the Employee
ceases to be an employee of the Company or an affiliate for any reason.  Except as provided in Section III below,
any portion of the Restricted Shares which are not vested at the time of
Employee’s Termination of Service shall be forfeited.

 

III.                                 Notwithstanding
the provisions of Sections I or II above, in the event of the occurrence of any
Change in Control prior to the Employee’s Termination of Service, any
previously unvested Restricted Shares shall become immediately vested.

 

1

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