Document:

ex10_1.htm

    
      

    

    

      Exhibit
10.1

      

      

      PAB
BANKSHARES, INC.

      

      FOURTH
AMENDED AND RESTATED

      DIVIDEND
REINVESTMENT

      AND
COMMON STOCK PURCHASE PLAN

      

      

      1.           Establishment of
Plan.  PAB Bankshares, Inc. (the "Company") hereby adopts this
Dividend Reinvestment and Common Stock Purchase Plan (the "Plan") to be
effective January 1, 1994, or as soon thereafter as the Company can reasonably
complete registration under federal and state securities laws of shares of its
common stock, no par value (the "Common Stock"), for offer and sale under the
Plan.

      

      2.           Purpose.  The
purpose of the Plan is to provide the holders of the Common Stock with a simple
and convenient means of (i) automatically reinvesting cash dividends and (ii)
making additional voluntary cash payments to purchase shares of Common
Stock.

      

      3.           Eligibility and
Participation.  Any holder of Common Stock (a "Shareholder")
may participate in the Plan by completing and returning to the Company’s
transfer agent an authorization card or form in a format approved from time to
time by the Company (the "Authorization Card").  A broker or nominee
that is a record owner of Common Stock may participate in the Plan on behalf of
one or more beneficial owners of Common Stock in accordance with the rules and
regulations established by the Company.  Within 30 days following the
receipt of the Authorization Card by the Company’s transfer agent, the
Shareholder will become a participant in the Plan (a
"Participant").  Authorization Cards will be available from the
Company and the Company’s transfer agent.  A Shareholder will not be
charged any fee to become a Participant.  A Shareholder is eligible to
participate in the Plan with respect to all or any portion of the shares of
Common Stock registered in his or her name, as specified on the Authorization
Card by each Participant.  If a Participant withdraws from the Plan
pursuant to the provisions hereof, such Shareholder may rejoin the Plan by again
completing and returning an Authorization Card to the Company’s transfer agent,
thereafter becoming a Participant once again within 30 days following the
receipt of the Authorization Card by the Company’s transfer agent.

      

      4.           Restrictions on
Participation.  Anything herein to the contrary
notwithstanding, participation in the Plan is subject to compliance with the
securities laws of the various states in which Shareholders and Participants
reside. The Company may refuse to enroll in the Plan, or may require immediate
withdrawal from the Plan of, any Shareholders or Participants residing in states
where the securities laws now or hereafter prohibit the operation of the Plan,
require registration procedures which the Company deems overly burdensome or
contain no exemption from such registration requirements.

      

      5.           The
Administrator.  All purchases under the Plan will be made on
behalf of the Participants by Registrar and Transfer Co. (the
"Administrator").  The Administrator hereby agrees to receive and hold
funds and shares of Common Stock in the Plan and to administer the
Plan.  The Administrator will establish an individual account for each
Participant (the "Participant's Account") which will reflect the number of
shares of Common Stock in said account, including fractions computed to three
decimal places, and cash to be invested.  The Administrator shall
arrange for the custody of stock certificates, maintain ongoing records, send
statements of accounts to Participants as hereinafter specified and perform
other administrative duties relating to the Plan. The Administrator, with the
consent of the Company, will have the power and authority to establish such
procedures as the Administrator deems necessary to administer the
Plan.

      

      6.           Stock
Purchases.  Participants may purchase shares of Common Stock
pursuant to the Plan in one of two ways as of the next Investment Date (as
defined hereinafter).  First, the Administrator will automatically
apply cash dividends received, subsequent to the dividend record date (the
"Record Date"), on the shares of Common Stock (less any applicable withholding
taxes) registered under the Plan as specified on the Authorization Card by each
Participant towards the purchase of full and fractional shares of Common
Stock.  Second, commencing January 1, 1995, the Administrator will
apply all voluntary cash payments, as more particularly described below, made by
Participants towards the purchase of full and fractional shares of Common Stock,
but only if dividends are being automatically reinvested.

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      Exhibit
10.1

      

      Dividends
on all shares purchased for a Participant's Account under the Plan, whether
through dividend reinvestment or voluntary cash payments, will be automatically
reinvested in additional shares of Common Stock as of the next Investment Date
(as defined hereinafter).

      

      Shareholders
may request to receive their dividends in cash at any time by giving the
Administrator written notice.  Such request will be effective
immediately if the Administrator receives notice at least five business days
prior to the Record Date; otherwise such notice will be effective for the next
Record Date.

      

      (a)           Investment
Date.  Purchases will be made on the fifteenth day of each
month (the “Investment Date”); provided, however, that if the fifteenth day
falls on a holiday or weekend, the Investment Date will be the first business
day after such date.  The shares of Common Stock so purchased shall be
allocated to each Participant's Account on the Investment Date.  All
shares of Common Stock so purchased may be purchased and held in the name of the
Plan or the Administrator.

      

      (b)           Purchase of Authorized but
Unissued Shares/Open Market Purchases.  At the option of the
Company, purchases of Common Stock will either be made directly from the Company
from authorized but unissued shares, in the open market or a combination
thereof. The Company will direct the Administrator with respect to each
Investment Date as to the extent to which Common Stock is to be purchased
directly from the Company or in the open market. The proceeds of any purchase
from authorized but unissued shares will be used by the Company for general
corporate purposes.

      

      (c)           Number of Shares
Purchased. The number of shares purchased for a Participant's Account
shall be equal to the number of shares, including fractions computed to three
decimal places, equal to (i) the amount of dividends invested on an Investment
Date (dividends less any applicable withholding taxes) divided by the purchase
price per share plus (ii) the amount of voluntary cash payments invested on an
Investment Date divided by the purchase price per share.

      

      (d)           Purchase
Price.  The purchase price for each share of Common Stock (the
"Purchase Price") will be equal to the weighted average price incurred to
purchase all shares acquired on the Investment Date.

      

      (e)           Voluntary Cash
Payments.  Participants who have submitted valid Authorization
Cards are eligible to make voluntary cash payments at any time commencing
January 1, 1995.  Voluntary cash payments shall be accompanied by such
authorization forms or cash payment forms as specified by the Company from time
to time.  Voluntary cash payments may be made by sending a personal
check, drawn from a U.S. Bank in U.S. Currency payable to Registrar and Transfer
Company.  Any voluntary cash payment by a Participant must not be less
than $50 per payment; provided, however, all payments for each calendar year may
not exceed $6,000 in the aggregate.  Voluntary cash payments must be
received by the Administrator at least five business days, but no more than 30
days, before the Investment Date in order to be used to allocate shares of
Common Stock to a Participant's Account on that Investment Date.  The
Administrator shall remit all payments received less than five business days
before an Investment Date and more than 30 days before the next Investment Date
to the Participant.

      

      Commencing
June 1, 2007, a Participant may request to have voluntary cash payments made
automatically each month from a personal deposit account.  Automatic
deposit requests shall be accompanied by such authorization forms as specified
by the Company from time to time.  Any voluntary cash payment by a
Participant must not be less than $50 per payment, nor more than $500 per
payment; provided, however, all payments for each calendar year may not exceed
$6,000 in the aggregate.  The Company, or the Administrator, will
withdraw the voluntary cash payment amount from the Participant’s personal
deposit account five business days prior to the Investment Date.  A
Participant may discontinue the automatic deposits, or change the contribution
amount of each automatic deposit by submitting an authorization form as
specified by the Company from time to time.  Any such request shall
become effective for the month in which the request is made so long as the
request is received and accepted by the Company, or the Administrator, at least
ten business days prior to the Investment Date.

      

      (f)           Miscellaneous
Considerations.  No interest will be paid on any dividends and
voluntary cash payments for the period following their receipt and prior to
investment on an Investment Date.

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      Exhibit
10.1

      

      7.           Custody of
Stock.  A Participant becomes the owner of the shares of Common
Stock purchased under the Plan and allocated to his or her Participant's Account
as of the Investment Date on which it is purchased.  Participation in
any rights offering will be based upon both the shares of Common Stock
registered in each Participant's name and the Plan shares (including fractional
interests) credited to each Participant's Account.  Any stock
dividends or shares issued pursuant to any stock split received by the
Administrator with respect to Common Stock held in a Participant's Account will
be immediately credited to such Participant's Account. The Administrator shall
sell any stock rights or warrants applicable to any shares of Common Stock held
in a Participant's Account and reinvest the proceeds in shares of Common Stock
as of the next Investment Date.  If such rights or warrants have no
market value, the Administrator may allow them to expire.

      

      8.           Certificate
Issuance.  Upon written request to the Administrator, a stock
certificate will be issued to a Participant for the number of full shares of
Common Stock in such Participant's Account (minimum issuance of 10 shares),
except that no certificate will be issued between the Record Date and the
Investment Date. Upon issuance of such certificate, a Participant shall have all
rights of ownership, and neither the Administrator nor the Company shall have
any responsibility with respect to such shares of Common Stock.

      

      Automatic
reinvestments of dividends will continue as long as there are any shares of
Common Stock registered in the name of a Participant or held for him or her by
the Administrator or until termination of enrollment in the
Plan.  Similarly, if a Participant acquires additional shares of Common Stock registered
in his or her name, dividends paid on the acquired shares of Common Stock will
automatically be reinvested until termination of enrollment in the
Plan.

      

      9.           Voting
Rights.  The Administrator will not vote the shares of Common
Stock held for a Participant's Account.  A Participant will have all
rights of a Shareholder as soon as there are shares of Common Stock (whole or
fractional) credited to such Participant's Account.  Whole and
fractional shares credited to a Participant's Account will be voted by such
Participant. Proxy materials will be forwarded to each Participant of record to
be voted at his or her discretion, and all other communications from the Company
to its Shareholders will be forwarded to each Participant of
record.

      

      10.           Expenses. The Company
will bear the expense of administering the Plan and having the Administrator
purchase shares of Common Stock and hold them until certificates are issued to
the Participants, including transfer taxes and costs of transferring the shares
of Common Stock from the Plan to the Participants.

      

      11.           Reports to
Participants. The Administrator will render a statement of account to
each Participant no later than 45 days after the close of each
Quarter.  Such statement will show the following information for the
Quarter:

      

      
        	
                 
      

              	
                (a)

              	
                the
      total amount invested by the Administrator (dividends and voluntary cash
      payments less any applicable tax
withheld);

              

      

      (b)           the
shares of Common Stock allocated to a Participant's Account;

      (c)           the
cost per share of allocated Common Stock;

      (d)           the
number of shares of Common Stock for which certificates have been issued;
and

      (e)           the
beginning and ending balances in each Participant's Account.

      

      12.           Withdrawal from
Plan.  A Participant may withdraw from the Plan at any time by
giving written notice to the Administrator.  Upon withdrawal, the
Participant may elect in writing (a) to receive certificates representing the
full shares of Common Stock in the Participant's Account and cash in lieu of
fractional shares (except than no certificate will be issued between the Record
Date and the Investment Date), or (b) to receive cash for all of the full and
fractional shares of Common Stock in the Participant's Account.  If no
written election is made at the time the Administrator receives written notice
of withdrawal from the Participant, certificates will be issued for all full
shares of Common Stock in the Participant’s Account, and the Participant will
receive cash for any fractional shares.

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      Exhibit
10.1

      

      In the
event a Participant elects to receive cash for the shares of Common Stock in the
Participant’s Account, the Administrator, as the Participant’s agent, will
promptly sell such shares of Common Stock and deliver to the Participant the
proceeds of such sale, less any termination charges, brokerage commissions and
any other costs of sale.  Any full and fractional interests in shares
of Common Stock may be aggregated and sold with those of other withdrawing
Participants.  The proceeds to each Participant, in such case, will be
the average sales price of all shares of Common Stock so aggregated and sold,
less his or her pro rata share of any brokerage commissions and other costs of
sale.  In all withdrawals, fractional interests held in the
Participant's Account and not otherwise aggregated and sold will be paid for in
cash at a price in proportion to the arithmetic average of the high and low
sales prices of the Common Stock on the date of withdrawal as reported on the
Nasdaq Global Market or other appropriate market, as determined by the
Administrator, on which the Common Stock is traded.

      

      Notice of
the death, liquidation or other termination of legal existence of a Participant
shall constitute notice of withdrawal from the Plan.  Settlement will
be made with such Participant's legal representative or successor in interest,
and neither the Administrator nor the Company shall be in any way liable for
settlements made with such persons.

      

      13.           Amendment and Termination of
the Plan.  The Company reserves the right to amend or terminate
the Plan at any time upon giving 30 days' written notice to the Participants and
the Administrator setting forth the effective date of the amendment or
termination.  The Company, with the consent of the Administrator, may
also terminate or amend the Plan immediately upon written notice to the
Participants in order to correct any non-compliance of the Plan with any
applicable law or to make administrative changes which are not
material.  No amendment or termination will affect any Participant's
interest in the Plan which has accrued prior to the date of the amendment or
termination.  In the event of the termination of the Plan, the
Administrator will make a distribution of the shares of Common Stock and cash as
if each Participant had withdrawn from the Plan electing not to sell his or her
shares of Common Stock as soon is practicable, but not later than 30 days after
the termination of the Plan.  Participants will incur no service
charges or other fees upon such termination.

      

      14.           Risk of Stock
Ownership.  Each Participant assumes all risks inherent in the
ownership of any shares of Common Stock purchased under the Plan, whether or not
the actual stock certificate has been issued to a Participant. A Participant has
no guarantee against a decline in the price or value of the Common Stock, and
the Company assumes no obligation for repurchase of a Participant's Common Stock
purchased under the Plan. A Participant has all the rights of any holder of
Common Stock with respect to the shares of Common Stock issued to him or her
under the Plan.

      

      15.           Liability of the Company and
the Administrator. Neither the Company nor the Administrator shall be
liable for any acts done or any omission to act, including, without limitation,
any claims of liability (a) with respect to the prices at which Common Stock is
purchased or valued for a Participant's Account and the times which such
purchases or valuations are made, (b) for any fluctuation in the market value
before or after the purchase or sale of Common Stock, or (c) for continuation of
a Participant's Account until receipt by the Administrator of notice in writing
of such Participant's death, liquidation or other legal
dissolution.

      

      16.           Administration of the
Plan.  The Plan will be administered and coordinated by the
Administrator, and all purchases will be made by the Administrator in accordance
with the terms hereof.  Any question of interpretation arising under
the Plan will be determined by the Company.

      

      17.           Federal Income
Taxes.  Neither the Company nor the Administrator makes any
representation as to the income or other tax consequences of participation in
the Plan. Nevertheless, it is the Company's understanding that a Participant in
the Plan who acquires shares purchased directly from the Company with reinvested
dividends will be treated as receiving a dividend in an amount equal to the fair
market value of the additional shares so acquired, and a Participant in the Plan
who acquires shares purchased in the open market with reinvested dividends will
be treated as receiving a cash distribution equal to the sum of the purchase
price and the pro rata brokerage fees, if any, paid by the Company in connection
with the purchase of such shares.  The federal income tax basis of the
Common Stock received by a Participant under the Plan that was purchased from
the Company will be the amount treated as a dividend.  The federal
income tax basis of the Common Stock received by a Participant under the Plan
that was purchased in an open-market transaction will be equal to the purchase
price thereof, plus the pro-rata brokerage fees, if any, paid by the Company in
connection therewith.  The holding period for shares of Common Stock
acquired under the Plan will begin on the date following the day on which the
shares are credited to the Participant’s Account, and a whole share resulting
from the acquisition of two or more fractional shares will have a split holding
period.  Upon the sale or exchange of Common Stock purchased pursuant
to the Plan, capital gain or loss treatment may be applicable.

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      Exhibit
10.1

      

      18.           Correspondence.  All
correspondence and notices to the Company shall be sent to:

      PAB
Bankshares, Inc.

      3250
North Valdosta Road

      Valdosta,
Georgia 31602

      Attention:  Denise
G. McKenzie, Assistant Vice President and Corporate Secretary

      

      

      All
correspondence and notices to the Administrator shall be sent to:

      

      Registrar
and Transfer Co.

      10
Commerce Drive

      Cranford,
New Jersey 07016-3572

      Attention:  Dividend
Reinvestment Department

      

      All
correspondence and notices to Participants shall be sent to the address shown on
each Participant's Authorization Card or such new address as a Participant
provides in writing to the Company.

      

      Notice to
the Company or the Administrator shall be effective when it is actually
received. Notice to a Participant is effective when mailed, postage pre-paid, to
the address indicated above.

      

      19.           Miscellaneous.  Except
as expressly provided herein, a Participant shall have no right to sell, assign,
encumber or otherwise dispose of his or her rights in such Participant's
Account.   A Participant shall have no right to draw checks or
drafts against such Participant’s Account or to instruct the Administrator to
perform any acts not expressly provided for herein.  This Plan shall
be governed by the laws of the State of Georgia except to the extent superseded
by federal law.

    

     

     

    5ex10_12.htm

    
      

    

    Exhibit
10.12

     

    
[Standard Form of Stock Option Agreement]

    

    LINCOLN
EDUCATIONAL SERVICES CORPORATION

    2005
LONG-TERM INCENTIVE PLAN

     

    STOCK
OPTION AGREEMENT

    

    Lincoln
Educational Services Corporation (the “Company”) hereby
grants you, _______________________  (the “Optionee”), an option
(the “Option”)
under the Company’s 2005 Long-Term Incentive Plan (the “Plan”) to purchase
Ordinary Shares (“Shares”) of the
Company.  Subject to the provisions of the Plan and the Option Rules
attached hereto as Exhibit A, the principal features of the Option are as
follows:

     

    
    

    
    

    
    

    
    

    
    

    
    

    
      
        	
                Date
      of Grant

              	 
      
	
                Exercise
      Price per Share

              	$______________
	
                Number
      of Optioned Shares

              	_______________
	
                Type
      of Option:

              	
                ___Incentive
      Stock Option (ISO) (to the extent permitted by applicable
      laws)

              
	 
      	
                ___Nonstatutory
      Stock Option (NSO)

              
	
                Expiration
      Date:

              	
                10
      years from the Date of
Grant

              

      

    Vesting
Schedule

     

    The
Option shall become exercisable, in whole or in part, in accordance with the
terms of the Plan, the Option Rules (attached hereto as Exhibit A) and the
following vesting schedule:

     

    The
Option shares shall vest on [ ____ ], subject to your continuing to be an
employee or consultant (a “Service Provider”)
through these dates.

     

    Option
Termination:

     

    
      	
              Event Triggering
      Option Termination

            	
              Maximum Time to
      Exercise After Triggering Event*

            
	 
      	 
      
	
              Termination
      of Service, other than for Cause (except as provided
below)

            	
              30
      days

            
	
              Termination
      of Service for Cause

            	
              Immediately

            
	
              Termination
      of Service due to Disability

            	
              6
      months

            
	
              Termination
      of Service due to death

            	
              6
      months

            
	
              Resignation

            	
              Immediately

            

    

    

    *However,
in no event may the Option be exercised after the Expiration
Date.  It is your
responsibility to exercise the Option, if you so desire, before it expires or
terminates.

     

    Your
signature below indicates your agreement, understanding, and acceptance that the
Option is subject to all of the terms and conditions contained in Exhibit A and
the Plan.  Please be
sure to read all of Exhibit A, which contains the specific terms and conditions
of the Option.

     

    This
Option Agreement does not represent a securities interest in the Company, which
interest may accrue only upon the exercise of the Option in accordance with its
terms.

     

    
      	
              LINCOLN
      EDUCATIONAL SERVICES CORPORATION

            	
              OPTIONEE

            
	
               

            	 
      	
               

            	 
      
	
              [Title]

            	 
      	
              Signed

            	 
      
	 
      	 
      	 
      	 
      
	
               

            	 
      	
               

            	 
      
	
              Date

            	 
      	
              Date

            	 
      

    

    

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    

     

    EXHIBIT
A

    

    OPTION
RULES

     

    1.            
Grant of
Option.  The Committee hereby grants to the Optionee under the
Plan the right to purchase the number of Shares set forth on the first page of
this Option Agreement (the “Grant Notice”), at the Exercise Price per Share set
forth in the Grant Notice, and subject to all of the terms and conditions in
this Option Agreement and the Plan, a copy of which the Optionee acknowledges
having received.

     

    The
aggregate Fair Market Value (determined with respect to each Incentive Stock
Option at the time the Incentive Stock Option is granted) of Shares with respect
to which Incentive Stock Options are exercisable for the first time by the
Optionee during any calendar year (under the Plan or any other plan of the
Company) shall not exceed US$100,000.  If the Option is designated in
the Grant Notice as an Incentive Stock Option, all or a portion of the Option
may nonetheless be treated as a Nonstatutory Stock Option.

     

    2.            
Definitions.
Unless otherwise defined herein, the capitalized terms in this Option Agreement
shall have the meanings ascribed to those terms in the Plan.  In the
event of a conflict between the terms and conditions of the Plan and this Option
Agreement, the terms and conditions of the Plan shall prevail unless otherwise
indicated.

     

    “Cause” shall mean (unless otherwise
defined in an agreement between the Service Provider and the Company or any of
its subsidiaries, in which case the term “Cause” as used herein with
respect to such Service Provider shall have the meaning ascribed to it therein),
(i) the Service Provider’s willful failure to perform the duties of his or her
employment or consultancy in any material respect, (ii) malfeasance or gross
negligence in the performance of a Service Provider’s duties of employment or
consultancy, (iii) the Service Provider’s conviction of a felony under the laws
of the United States or any state thereof (whether or not in connection with his
or her employment or consultancy), (iv) the Service Provider’s intentional or
reckless disclosure of trade secrets or confidential or proprietary information
respecting the Company’s or any of its subsidiaries’ business to any individual
or entity which is not in the performance of the duties of his or her employment
or consultancy, (v) the Service Provider’s commission of an act or acts of
sexual harassment that would normally constitute grounds for termination, or
(vi) any other act or omission by the Service Provider (other than an act or
omission resulting from the exercise by the Service Provider of good faith
business judgment), which is materially injurious to the financial condition or
business reputation of the Company or any of its affiliates; provided, however, that in the
case of (i) and (ii) above, a Service Provider shall not be deemed to have been
terminated for cause unless he has received written notice of the alleged basis
therefor from the Company, and fails to remedy the matter within thirty (30)
days after he has received such notice, except that no such “cure opportunity”
shall be required in the case of two separate episodes giving the Company, the
right to terminate for cause for such reason occurring within any 12-month
period.

     

    3.            
Exercise of
Option.

     

    (a)           Right to
Exercise.  The
Option shall be exercisable during its term cumulatively according to the
Vesting Schedule set out in the Grant Notice and with the applicable provisions
of the Plan.  Notwithstanding the foregoing, the Option shall not be
exercised for a fraction of a Share.

     

    (b)           Method of
Exercise.  The Option shall be exercisable to the extent then
vested by delivery of a written exercise notice in the form attached hereto as
Exhibit B (the
“Exercise
Notice”), which shall state the election to exercise the Option, the
number of Shares with respect to which the Option is being exercised, and such
other representations and agreements as may be required by the
Company.  The Exercise Notice shall be signed by the Optionee (or by
the Optionee’s beneficiary or other person entitled to exercise the Option in
the event of the Optionee’s death under the Plan) and shall be delivered in
person or by certified mail to the Secretary of the Company.  The
Exercise Notice shall be accompanied by payment of the aggregate Exercise Price
as to all Shares exercised.  The Option shall be deemed to be
exercised as of the date (the “Exercise Date”)
(i) the Company receives (as determined by the Committee in its sole, but
reasonable, discretion) the fully executed Exercise Notice accompanied by
payment of the aggregate Exercise Price and (ii) all other applicable terms
and conditions of the Option Agreement are satisfied.

     

    
      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    

     

    (c)           Issuance of
Shares.  After receiving the Exercise Notice, the Company shall
cause to be issued a certificate or certificates for the Shares as to which the
Option has been exercised, registered in the name of the person exercising this
Option (or in the names of such person and his or her spouse as community
property or as joint tenants with right of survivorship).  The Company
shall cause the certificate or certificates to be deposited with the Company’s
designated stock option provider for the account of the Optionee.

     

    4.           Method of
Payment.  Payment of the aggregate Exercise Price shall be by
any of the following forms of consideration, or a combination thereof, at the
election of the Optionee:

     

    (a)           cash
or check;

     

    (b)           at
the discretion of the Committee and if the Shares are publicly traded,
consideration received by the Company under a formal cashless exercise program
adopted by the Company in connection with the Plan; or

     

    (c)           at
the discretion of the Committee, surrender of other Shares which, if accepted by
the Company, would not subject the Company to adverse accounting as determined
by the Committee.

     

    5.           Non-Transferability of
Option.  The Option and the rights and privileges conferred
hereby shall not be sold, pledged or otherwise transferred (whether by operation
of law or otherwise) in any manner otherwise than by will or by the laws of
descent or distribution, shall not be subject to sale under execution,
attachment, levy or similar process and may be exercised during the lifetime of
the Optionee only by the Optionee.  The terms of the Plan and the
Option Agreement shall be binding upon the executors, Committees, heirs,
successors and assigns of the Optionee.

     

    6.           Term of
Option.  The Option shall in any event expire on the expiration
date set forth in the Grant Notice, and may be exercised prior to the expiration
date only in accordance with the Plan and the terms of this Option
Agreement.

     

    7.           Tax
Obligations.

     

    (a)           Withholding
Taxes.  The Optionee shall make appropriate arrangements with
the Company (or Subsidiary employing or retaining the Optionee) for the
satisfaction of all U.S. Federal, state, local and non-U.S. income and
employment tax withholding requirements applicable to the Option
exercise.  The Optionee hereby acknowledges, understands and agrees
that the Company may refuse to honor the exercise and refuse to deliver Shares
if the withholding amounts are not delivered at the time of
exercise.

     

    (b)           Notice of Disqualifying
Disposition of Shares.  If the Option granted to the Optionee
herein is designated as an Incentive Stock Option, and if the Optionee sells or
otherwise disposes of any of the Shares acquired pursuant to the Incentive Stock
Option on or before the later of (1) the date two years after the Date of Grant
and (2) the date one year after the date of exercise, the Optionee shall
immediately notify the Company in writing of such disposition.  The
Optionee hereby acknowledges and agrees that the Optionee may be subject to
income tax withholding by the Company on the compensation income recognized by
the Optionee in connection with the exercise of the Option.

     

    8.            
Adjustment of
Shares.  In the event of any transaction described in Section
13(b) of the Plan, the terms of the Option (including, without limitation, the
number and kind of the Optioned Shares and the Exercise Price) may be adjusted
as set forth in Section 13(b) of the Plan.  This Option Agreement
shall in no way affect the right of the Company to adjust, reclassify,
reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer any part of its business or
assets.

     

    9.            
Legality of Initial
Issuance.  No Shares shall be issued upon the exercise of the
Option unless and until the Company has determined that: (i) the Company and the
Optionee have taken all actions required to register the Shares under the
Securities Act of 1933, as amended (the “Securities Act”) or to perfect an
exemption from the registration requirements thereof, if applicable; (ii) all
applicable listing requirements of any stock exchange or other securities market
on which the Shares are listed have been satisfied; and (iii) all other
applicable provisions of state or U.S. federal law or other applicable laws have
been satisfied.

     

    
      
        
           

        

        
          - 2
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    10.           Securities Law
Restrictions.  Regardless of whether the offering and sale of
Shares under the Plan have been registered under the Securities Act or have been
registered or qualified under the securities laws of any state, the Company at
its discretion may impose restrictions upon the sale, pledge or other transfer
of the Shares (including the placement of appropriate legends on share
certificates or the imposition of stop-transfer instructions) if, in the
judgment of the Company, such restrictions are necessary or desirable in order
to achieve compliance with the Securities Act, the securities laws of any state
or any other applicable laws.

     

    11.           General
Provisions.

     

    (a)           Notice.  Any
notice required by the terms of this Option Agreement shall be given in writing
and shall be deemed effective upon personal delivery or upon deposit with the
United States Postal Service, by registered or certified mail, with postage and
fees prepaid.  Notice shall be addressed to the Company at its
principal executive office and to the Optionee at the address that he or she
most recently provided to the Company.

     

    (b)           Successors and
Assigns.  Except as provided herein to the contrary, this
Option Agreement shall be binding upon and inure to the benefit of the parties
to this Option Agreement, their respective successors and permitted
assigns.

     

    (c)           No
Assignment.  Except as otherwise provided in this Option
Agreement, the Optionee shall not assign any of his or her rights under this
Option Agreement without the prior written consent of the Company, which consent
may be withheld in its sole discretion.  The Company shall be
permitted to assign its rights or obligations under this Option Agreement, but
no such assignment shall release the Company of any obligations pursuant to this
Option Agreement.

     

    (d)           Severability.  The
validity, legality or enforceability of the remainder of this Option Agreement
shall not be affected even if one or more of the provisions of this Option
Agreement shall be held to be invalid, illegal or unenforceable in any
respect.

     

    (e)           Administration.  Any
determination by the Committee in connection with any question or issue arising
under the Plan or this Option Agreement shall be final, conclusive, and binding
on the Optionee, the Company, and all other persons.

     

    (f)           Headings.  The
section headings in this Option Agreement are inserted only as a matter of
convenience, and in no way define, limit or interpret the scope of this Option
Agreement or of any particular section.

     

    (g)           Counterparts.  This
Option Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

     

    (h)           Entire Option Agreement;
Governing Law.  The provisions of the Plan are incorporated
herein by reference.  The Plan and this Option Agreement constitute
the entire agreement of the parties with respect to the subject matter hereof
and supersede in their entirety all prior undertakings and agreements of the
Company and the Optionee with respect to the subject matter hereof, and may not
be modified adversely to the Optionee’s interest except by means of a writing
signed by the Company and the Optionee.  This Option Agreement is
governed by the laws of the State of New York applicable to contracts executed
in and to be performed in that State.

     

    12.           No Guarantee of Continued
Service.  THE OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING
OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING
AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING
HIRED, BEING GRANTED THE OPTION OR ACQUIRING SHARES HEREUNDER).  THE
OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS OPTION AGREEMENT, THE OPTION
GRANTED HEREUNDER, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY
PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH THE OPTIONEE’S RIGHT
OR THE COMPANY’S RIGHT TO TERMINATE THE OPTIONEE’S RELATIONSHIP AS A SERVICE
PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

     

    o O
o

     

    
      
        
           

        

        
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    EXHIBIT
B

     

    LINCOLN
EDUCATIONAL SERVICES CORPORATION

    2005
LONG-TERM INCENTIVE PLAN

    EXERCISE
NOTICE

     

    Lincoln
Educational Services Corporation

    200
Executive Drive, Suite 340

    West
Orange, New Jersey 07052

     

    Attention:  Secretary

     

    1.           Exercise of
Option.  Effective as of today, _____________, _____, the
undersigned (the “Optionee”) hereby
elects to exercise the Optionee’s option to purchase _________ Ordinary Shares
(the “Shares”)
of Lincoln Educational Services Corporation (the “Company”), under and
pursuant to the 2005 Long-Term Incentive Plan (the “Plan”) and the Share
Option Agreement dated ____________, ____ (the “Option
Agreement”).  Unless otherwise defined herein, the capitalized
terms in this notice of exercise (the “Exercise Notice”)
shall have the meanings ascribed to those terms in the Plan.

     

    2.           Delivery of
Payment.  The Optionee herewith delivers to the Company the
full Exercise Price of the Shares with respect to which the Optionee is
exercising the Option, and any and all withholding taxes due in connection with
the exercise of the Option.

     

    3.           Representations of the
Optionee.  The Optionee hereby acknowledges that the Optionee
has received and read, and understands the Plan and the Option Agreement,
including the Option Rules, and agrees to abide by and be bound by their terms
and conditions.

     

    4.           Rights as
Stockholder.  Until the issuance of the Shares (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company), no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Optioned Shares,
notwithstanding the exercise of the Option.  The Shares shall be
issued to the Optionee as soon as practicable after the Option is exercised in
accordance with the Option Agreement.  No adjustment shall be made for
a dividend or other right for which the record date is prior to the date of
issuance except as provided in Section 13 of the Plan.

     

    5.           Tax
Consultation.  The Optionee hereby acknowledges that he or she
understands that the Optionee may suffer adverse tax consequences as a result of
the Optionee’s purchase or disposition of the Shares.  The Optionee
hereby represents that the Optionee has consulted with any tax consultants the
Optionee deems advisable in connection with the purchase or disposition of the
Shares and that the Optionee is not relying on the Company for any tax
advice.

     

    6.           Interpretation.  Any
dispute regarding the interpretation of this Exercise Notice shall be submitted
by the Optionee or by the Company forthwith to the Committee, which shall review
such dispute at its next regular meeting.  The resolution of such a
dispute by the Committee shall be final and binding on all parties.

     

    7.           Governing Law;
Severability.  This Exercise Notice is governed by the laws of
the State of New York applicable to contracts executed in and to be performed in
that State.

     

    8.           Entire
Agreement.  The Plan and Option Agreement are incorporated
herein by reference.  This Exercise Notice, the Plan, and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and the Optionee with respect to the subject matter
hereof, and may not be modified adversely to the Optionee’s interest except by
means of a writing signed by the Company and the Optionee.

     

    [SIGNATURE
PAGE FOLLOWS]

     

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    

     

    IN
WITNESS WHEREOF, this Exercise Notice is deemed made as of the date first set
forth above.

     

    
      	
              Submitted
      by:

            	 
      	
              Accepted
      by:

               

            
	 
      	 
      	 
      
	
              OPTIONEE

            	 
      	
              LINCOLN
      EDUCATIONAL SERVICES CORPORATION

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              Signature

            	 
      	
              By

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              Print
      Name

            	 
      	
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              Date
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