Document:

Exhibit 10

Exhibit 10.22

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (this “Agreement”) is

made and entered into effective as of the 11th day of April, 2002,

by and among MAIN STREET BANKS, INC.,

a Georgia corporation (hereinafter, the “Company”), and MAX S. CROWE (hereinafter, “Executive”), to

be effective as of the Effective Date, as defined in Section 1.

 

BACKGROUND

 

WHEREAS, the Company

desires to employ Executive and Executive is willing to provide services to the

Company in accordance with the terms and conditions hereinafter set forth;

 

NOW, THEREFORE, in

consideration of the foregoing and of the mutual covenants and agreements set

forth herein, and other good and valuable consideration, the receipt and

sufficiency of which are hereby acknowledged, the parties hereto agree as

follows:

 

MSC SBH 1.          Effective Date.  The effective date of this Agreement (the

“Effective Date”) will be 4/23/02.  This

Agreement is subject to the condition that as of the Effective Date the

Executive shall have terminated his employment with his previous employer and

shall enter into the employment set forth herein.

 

2.              Employment.  Executive is hereby employed on the

Effective Date as Executive Vice President and Chief Banking Officer of the

Company and as the President and Chief Operating Officer of Main Street Bank

(“MSB”).  In such capacity, Executive

shall have such responsibilities commensurate with such positions as set forth

in the bylaws of the Company and MSB and as shall be assigned to him by the

Board of Directors, Chief Executive Officer or the Chief Operating Officer of

the Company, or by the Board of Directors or the Chief Executive Officer of

MSB.  Executive will report directly to

the Chief Operating Officer of the Company and the Chief Executive Officer of

MSB.

 

3.                Employment

Period.  Unless earlier terminated

herein in accordance with Section 6 hereof, Executive’s employment shall

be for a three year term (the “Employment Period”), beginning on the Effective

Date.  Beginning on the second

anniversary of the Effective Date and on each anniversary of the Effective

Date, the Employment Period shall, without further action by Executive or the

Company, be extended by an additional one-year period; provided, however,

that either party may, by notice to the other, cause the Employment Period to

cease to extend automatically.  Upon

such notice, the Employment Period shall terminate upon the expiration of the

then-current term, including any prior extensions.  If the Company causes the Employment Period to cease to extend

automatically then, in the absence of Cause (as defined in Section 6(b)), such

action shall constitute a termination without Cause and Executive shall be

entitled to severance as set forth in Section 7(a).

 

4.                Extent of

Service.  During the Employment

Period, and excluding any periods of vacation to which Executive is entitled,

Executive agrees to devote his business time, attention, skill and efforts

exclusively to the faithful performance of his duties hereunder; provided,

however, that it shall not be a violation of this Agreement for

Executive to (i) devote reasonable periods of time to charitable and community

activities and, with the approval of the Company, industry or professional

activities, and/or (ii) manage personal business interests and investments, so

long as such activities do not materially interfere with the performance of

Executive’s responsibilities under this Agreement.  It is expressly understood and agreed that to the extent that any

such activities have been conducted by Executive prior to date of this

Agreement, the continued conduct of such activities (or the conduct of

activities similar in nature and scope thereto) subsequent to the Effective

Date shall not thereafter be deemed to interfere with the performance of

Executive’s responsibilities hereunder.

 

 

5.                Compensation

and Benefits.

 

(a)           Base Salary.  During each year of the Employment Period,

the Company will pay to Executive annual base salary in the amount equal to

U.S. $215,000 (“Base Salary”), less normal withholdings, payable in equal

monthly or more frequent installments as are customary under the Company’s

payroll practices from time to time. 

Executive’s annual Base Salary shall be increased to $225,000 effective

July 1, 2002.   The Compensation

Committee of the Board of Directors of the Company shall review Executive’s

Base Salary annually and in its sole discretion, subject to approval of the

Board of Directors of the Company, may increase Executive’s Base Salary from

year to year; provided that annual increases of at least 3%, intended to

approximate cost of living increases, shall be automatic.  The annual review of Executive’s salary by

the Board will consider, among other things, Executive’s own performance and

the performance of the Company and MSB, as well as any recommendations of an

outside consulting firm that may be engaged by the Company, from time to time,

to evaluate management compensation.

 

(b)           Incentive, Savings and Retirement

Plans.  During the Employment

Period, Executive shall be entitled to participate in all incentive, savings

and retirement plans, practices, policies and programs applicable generally to

senior executive officers of the Company (“Peer Executives”), and on the same

basis as such Peer Executives.

 

(c)           Welfare Benefit Plans.  During the Employment Period, Executive and

Executive’s family shall be eligible for participation in, and shall receive

all benefits under, the welfare benefit plans, practices, policies and programs

provided by the Company (including, without limitation, medical, prescription,

dental, disability, employee life, group life, accidental death and travel

accident insurance plans and programs) (“Welfare Plans”) to the extent

applicable generally to Peer Executives.

 

(d)           Expenses.  During the Employment Period, Executive

shall be entitled to receive prompt reimbursement for all reasonable expenses

incurred by Executive in accordance with the policies, practices and procedures

of the Company to the extent applicable generally to Peer Executives.

 

(e)           Fringe Benefits.  During the Employment Period, Executive

shall be entitled to fringe benefits in accordance with the plans, practices,

programs and policies of the Company in effect for Peer Executives.  Without limiting the foregoing, during the

Employment Period, Executive shall be provided a car allowance or a

Company-owned car of a model appropriate to his position, as determined by the

Compensation Committee of the Board of Directors of the Company.

 

6.                Termination

of Agreement.

 

(a)           Death, Retirement or Disability.  Executive’s employment shall terminate

automatically upon Executive’s death or Retirement during the Employment

Period.  For purposes of this Agreement,

“Retirement” shall mean normal retirement as defined in the Company’s then-current

retirement plan, or if there is no such retirement plan, “Retirement” shall

mean voluntary termination after age 65 with ten years of service.  If the Company determines in good faith that

the Disability of Executive has occurred during the Employment Period (pursuant

to the definition of Disability set forth below), it may give to Executive

written notice of its intention to terminate Executive’s employment.  In such event, Executive’s employment shall

terminate effective on the 30th day after receipt of such written notice by

Executive (the “Disability Effective Date”), provided that, within the 30 days

after such receipt, Executive shall not have returned to full-time performance

of Executive’s duties.  For purposes of

this Agreement, “Disability” shall mean the inability of Executive, as

determined by the Board, to substantially perform the essential functions of

his regular duties and responsibilities, with or without reasonable

accommodation, due to a medically determinable physical or mental illness which

has lasted (or can reasonably be expected to last) for a period of six

consecutive months.  At the request of

Executive or his personal representative, the Board’s determination that the

Disability of Executive has occurred shall be certified by two physicians

mutually agreed upon by Executive, or his personal representative, and the

Company.  Failing such independent

certification (if so requested by Executive), Executive’s termination shall be

deemed a termination by the Company without Cause and not a termination by

reason of his Disability.

 

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(b)           Termination by the Company.  The Company may terminate Executive’s

employment during the Employment Period with or without Cause.  For purposes of this Agreement, “Cause”

shall mean:

 

(i)            the willful and continued failure of

Executive to perform substantially Executive’s duties with the Company (other

than any such failure resulting from incapacity due to physical or mental

illness, and specifically excluding any failure by Executive, after reasonable

efforts, to meet performance expectations), after a written demand for

substantial performance is delivered to Executive by the Chief Executive

Officer, the Chief Operating Officer or the Board of Directors of the Company

which specifically identifies the manner in which such officer or the Board

believes that Executive has not substantially performed Executive’s duties, or

 

(ii)           the willful engaging by Executive in

illegal conduct or gross misconduct which is materially and demonstrably injurious

to MSB or the Company; or

 

(iii)          a requirement by any state or federal

authority regulating the Company or MSB that Executive be removed from his

office.

 

For purposes

of this provision, no act or failure to act, on the part of Executive, shall be

considered “willful” unless it is done, or omitted to be done, by Executive in

bad faith or without reasonable belief that Executive’s action or omission was

in the best interests of MSB or the Company and its shareholders and

subsidiaries.  Any act, or failure to

act, based upon authority given pursuant to a resolution duly adopted by the

Board or based upon the advice of counsel for the Company shall be conclusively

presumed to be done, or omitted to be done, by Executive in good faith and in

the best interests of MSB and the Company, its shareholders and

subsidiaries.  The cessation of

employment of Executive under subparagraph (i) or (ii) above shall not be

deemed to be for Cause unless and until there shall have been delivered to

Executive a copy of a resolution duly adopted by the affirmative vote of not

less than three-fourths of the entire membership of the Board of Directors of

the Company at a meeting of such Board called and held for such purpose (after

reasonable notice is provided to Executive and Executive is given an

opportunity, together with counsel, to be heard before such Board), finding

that, in the good faith opinion of such Board, Executive is guilty of the

conduct described in subparagraph (i) or (ii) above, and specifying the

particulars thereof in detail.

 

(c)           Termination by Executive.  Executive’s employment may be terminated by

Executive for “Good Reason” as defined below. 

For purposes of this Agreement, “Good Reason” shall mean:

 

(i)            without the written consent of

Executive, a change in Executive’s status, title, position or responsibilities

(including reporting responsibilities) which, in Executive’s reasonable

judgment, represents an adverse change from his status, title, position or

responsibilities as in effect at the Effective Date or, if greater, at any time

thereafter; the assignment to Executive of any duties or responsibilities

which, in Executive’s reasonable judgment, are inconsistent with his status,

title, position or responsibilities as in effect at the Effective Date or, if

greater, at any time thereafter; or any other change in condition or

circumstances that in Executive’s reasonable judgment makes it materially more

difficult for Executive to carry out the duties and responsibilities of his

then-existing office; provided that Good Reason under this subparagraph (i)

excludes an isolated, insubstantial and inadvertent action not taken in bad

faith and which is remedied by the Company promptly after receipt of notice

thereof given by Executive;

 

(ii)           a reduction, without the written

consent of Executive, in Executive’s Base Salary as in effect on the Effective

Date or as the same may be increased from time to time, or any failure to pay

Executive any compensation or benefits to which he is entitled within five (5)

days of the date due;

 

(iii)          the failure by the Company (a) to

continue in effect (without reduction in benefit level and/or reward

opportunities) any compensation or employee benefit plan in which Executive

participated as of the Effective Date, or at any time thereafter, that is

material to Executive’s total compensation, unless an equitable arrangement

(embodied in an ongoing substitute or alternative plan) has been made with

 

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respect to such plan, or (b) to

continue Executive’s participation therein (or in such substitute or

alternative plan) on a basis not materially less favorable, both in terms of

the amount of benefits provided and the level of Executive’s participation

therein relative to other participants; or

 

(iv)          the Company’s requiring Executive,

without his consent, to be based at any office or location other than in the

Atlanta, Georgia metropolitan area;

 

(v)           the insolvency or the filing by any

party, including the Company or any of its subsidiaries, of a petition for

bankruptcy of the Company or any such subsidiary, which petition is not

dismissed within sixty (60) days;

 

(vi)          any failure by the Company to comply

with and satisfy Section 14(c) of this Agreement;

 

(vii)         any purported termination by the Company

of Executive’s employment otherwise than as expressly permitted by this

Agreement; or

 

(viii)        the material breach by the Company of

any provision of this Agreement.

 

Good Reason

shall not include Executive’s death or Disability.  Executive’s continued employment shall not constitute consent to,

or a waiver of rights with respect to, any circumstance constituting Good

Reason hereunder.

 

(d)           Notice of Termination.  Any termination by the Company for Cause, or

by Executive for Good Reason shall be communicated by Notice of Termination to

the other party hereto given in accordance with Section 15(f) of this

Agreement.  For purposes of this

Agreement, a “Notice of Termination” means a written notice which (i) indicates

the specific termination provision in this Agreement relied upon, (ii) to the

extent applicable, sets forth in reasonable detail the facts and circumstances

claimed to provide a basis for termination of Executive’s employment under the

provision so indicated and (iii) specifies the termination date.  If a dispute exists concerning the

provisions of this Agreement that apply to Executive’s termination of

employment, the parties shall pursue the resolution of such dispute with

reasonable diligence.  Within five (5)

days of such a resolution, any party owing any payments pursuant to the

provisions of this Agreement shall make all such payments together with

interest accrued thereon at the rate provided in Section 1274(b)(2)(B) of the

Internal Revenue Code of 1986, as amended (the “Code”).

 

(e)           Date of Termination.  “Date of Termination” means (i) if

Executive’s employment is terminated other than by reason of death or

Disability, the date of receipt of the Notice of Termination, or any later date

specified therein, or (ii) if Executive’s employment is terminated by reason of

death or Disability, the Date of Termination will be the date of death or the

Disability Effective Date, as the case may be. 

If Executive’s employment is terminated because of the Company’s action

to stop the automatic extension of the Employment Period other than for Cause

then the Date of Termination shall be the date of expiration of the

then-current term of the Employment Period.

 

7.                Obligations

of the Company upon Termination.

 

(a)           Termination by Executive for Good

Reason; Termination by the Company Other Than for Cause; Cessation of Automatic

Extension by Company Other Than for Cause. 

If, during the Employment Period, the Company shall terminate

Executive’s employment other than for Cause, or Executive shall terminate employment

for Good Reason, or the Company shall stop the automatic extension of the

Employment Period other than for Cause, then:

 

(i)            the Company shall pay to Executive

in a lump sum in cash within 30 days after the Date of Termination the

aggregate of the following amounts:

 

A.       the sum of (1) Executive’s Base Salary

through the Date of Termination to the extent not theretofore

 

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paid,

(2) the product of (x) Executive’s target annual bonus for the year in which

the Date of Termination occurred (the “Target Annual Bonus”) and (y) a

fraction, the numerator of which is the number of days in the current fiscal

year through the Date of Termination, and the denominator of which is 365, and

(3) any accrued vacation pay to the extent not theretofore paid, and (4) unless

Executive has elected a different payout date in a prior deferral election, any

compensation previously deferred by Executive (together with any accrued

interest or earnings thereon) to the extent not theretofore paid (the sum of

the amounts described in clauses (1), (2), (3) and (4) shall be hereinafter

referred to as the “Accrued Obligations”);

 

B.            the

amount equal to three times the sum of (1) Executive’s Base Salary in effect as

of the Date of Termination, and (2) the Target Annual Bonus;

 

(ii)           for three years after the Date of

Termination, or such longer period as may be provided by the terms of the

appropriate plan, program, practice or policy, the Company shall continue

benefits to Executive and/or Executive’s family at least equal to those which

would have been provided to them in accordance with the Welfare Plans described

in Section 5(c) of this Agreement if Executive’s employment had not been

terminated or, if more favorable to Executive, as in effect generally at any

time thereafter with respect to other Peer Executives and their families,

provided, however, that if Executive becomes re-employed with another employer

and is eligible to receive medical or other welfare benefits under another employer

provided plan, the medical and other welfare benefits described herein shall be

secondary to those provided under such other plan during such applicable period

of eligibility; and

 

(iii)          all of Executive’s

outstanding stock options and other incentive awards from the Company in the

nature of rights that may be exercised shall become fully exercisable and all

restrictions on Executive’s outstanding awards of restricted stock shall lapse;

and

 

(iv)          to the extent not

theretofore paid or provided, the Company shall timely pay or provide to

Executive any other amounts or benefits required to be paid or provided or

which Executive is eligible to receive under any plan, program, policy or

practice or contract or agreement of the Company (such other amounts and

benefits shall be hereinafter referred to as the “Other Benefits”).

 

(b)           Death; Disability or Retirement.  If Executive’s employment is terminated by

reason of Executive’s death, Disability or Retirement during the Employment

Period, this Agreement shall terminate without further obligations to Executive

or his legal representatives under this Agreement, other than for payment of

Accrued Obligations and the timely payment or provision of Other Benefits.  Accrued Obligations shall be paid to

Executive’s estate or beneficiary, as applicable, in a lump sum in cash within

30 days of the Date of Termination. 

With respect to the provision of Other Benefits, the term Other Benefits

as used in this Section 7(b) shall include, without limitation, and

Executive’s estate and/or beneficiaries shall be entitled to receive, benefits

under such plans, programs, practices and policies relating to death,

disability or retirement benefits, if any, as are applicable to Executive on

the Date of Termination.

 

(c)           Termination for

Cause or Termination by Executive Except for Good Reason.  If Executive’s employment shall be

terminated for Cause during the Employment Period, or if Executive voluntarily

terminates employment during the Employment Period (except for Good Reason),

this Agreement shall terminate without further obligations to Executive, other

than for payment of Accrued Obligations (excluding the pro-rata bonus described

in clause 2 of Section 7(a)(i)(A)) and the timely payment or provision of Other

Benefits.

 

8.                Non-exclusivity

of Rights.  Nothing in this

Agreement shall prevent or limit Executive’s continuing or future participation

in any plan, program, policy or practice provided by the Company and for which

Executive may qualify, nor, subject to Section 15(g), shall anything

herein limit or otherwise affect such rights as Executive may have under any

contract or agreement with the Company. 

Amounts which are vested benefits or which Executive is otherwise

entitled to receive under any plan, policy, practice or program of or any

contract or agreement with the Company or any of its affiliated companies at or

subsequent to the Date of Termination shall be payable in accordance with such

plan, policy, practice or program or contract or agreement except as explicitly

modified by this Agreement.

 

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9.                                                 Certain

Additional Payments by the Company.

 

(a)           Anything in this Agreement to the

contrary notwithstanding and except as set forth below, in the event it shall

be determined that any payment or distribution by the Company to or for the

benefit of Executive (whether paid or payable or distributed or distributable

pursuant to the terms of this Agreement or otherwise, but determined without

regard to any additional payments required under this Section 9) (a “Payment”)

would be subject to the excise tax imposed by Section 4999 of the Code or any

interest or penalties are incurred by Executive with respect to such excise tax

(such excise tax, together with any such interest and penalties, are

hereinafter collectively referred to as the “Excise Tax”), then Executive shall

be entitled to receive an additional payment (a “Gross-Up Payment”) in an

amount such that after payment by Executive of all taxes (including any

interest or penalties imposed with respect to such taxes), including, without

limitation, any income taxes (and any interest and penalties imposed with

respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Executive

retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon

the Payments.

 

(b)           All determinations required to be

made under this Section 9, including whether and when a Gross-Up Payment is

required and the amount of such Gross-Up Payment and the assumptions to be

utilized in arriving at such determination, shall be made by a certified public

accounting firm selected by Executive and reasonably acceptable to the Company

as may be designated by Executive (the “Accounting Firm”) which shall provide

detailed supporting calculations both to the Company and Executive within 15

business days of the receipt of notice from Executive that there has been a

Payment, or such earlier time as is reasonably requested by the Company.  All fees and expenses of the Accounting Firm

shall be borne solely by the Company. 

Any Gross-Up Payment, as determined pursuant to this Section 9, shall be

paid by the Company to Executive within five days of the receipt of the

Accounting Firm’s determination.  Any

determination by the Accounting Firm shall be binding upon the Company and

Executive.  As a result of the

uncertainty in the application of Section 4999 of the Code at the time of the

initial determination by the Accounting Firm hereunder, it is possible that

Gross-Up Payments which will not have been made by the Company should have been

made (“Underpayment”), consistent with the calculations required to be made

hereunder.  In the event that Executive

thereafter is required to make a payment of any Excise Tax, the Accounting Firm

shall determine the amount of the Underpayment that has occurred and any such

Underpayment shall be promptly paid by the Company to or for the benefit of

Executive.

 

10.              Costs of

Enforcement.  In any action taken in

good faith relating to the enforcement of this Agreement or any provision herein,

Executive shall be entitled to be paid any and all costs and expenses incurred

by him in enforcing or establishing his rights thereunder, including, without

limitation, reasonable attorneys’ fees, whether suit be brought or not, and

whether or not incurred in trial, bankruptcy or appellate proceedings.

 

11.              Representations

and Warranties.  Executive hereby

represents and warrants to the Company that Executive is not a party to, or

otherwise subject to, any covenant not to compete with any person or entity,

and Executive’s execution of this Agreement and performance of his obligations

hereunder will not violate the terms or conditions of any contract or

obligation, written or oral, between Executive and any other person or entity.

 

12.                                           Restrictions

on Conduct of Executive.

 

(a)           General.  Executive and the Company understand and

agree that the purpose of the provisions of this Section 12 is to protect

legitimate business interests of the Company and MSB, as more fully described

below, and is not intended to eliminate Executive’s post-employment competition

with the Company

 

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or MSB per

se, nor is it intended to impair or infringe upon Executive’s right to

work, earn a living, or acquire and possess property from the fruits of his

labor.  Executive hereby acknowledges

that the post-employment restrictions set forth in this Section 12 are

reasonable and that they do not, and will not, unduly impair his ability to

earn a living after the termination of this Agreement.  Therefore, subject to the limitations of

reasonableness imposed by law, Executive shall be subject to the restrictions

set forth in this Section 12.

 

(b)           Definitions.  The following capitalized terms used in this

Section 12 shall have the meanings assigned to them below, which definitions

shall apply to both the singular and the plural forms of such terms:

 

“Competitive Position”

means any employment with a Competitor in which Executive will use or is likely

to use any Confidential Information or Trade Secrets, or in which Executive has

duties for such Competitor that relate to Competitive Services and that are the

same or similar to those services actually performed by Executive for the

Company or MSB;

 

“Competitive Services”

means the provision of banking products and services similar in scope to those

provided by the Company and its subsidiaries as of the Effective Date.

 

“Competitor” means

any Person engaged, wholly or in part, in Competitive Services.

 

“Confidential Information” means

all information regarding the Company and MSB, their activities, business or

clients that is the subject of reasonable efforts by the Company or MSB to

maintain its confidentiality and that is not generally disclosed by practice or

authority to persons not employed by the Company or MSB, but that does not rise

to the level of a Trade Secret. 

“Confidential Information” shall include, but is not limited to,

financial plans and data concerning the Company or MSB; management planning

information; business plans; operational methods; market studies; marketing

plans or strategies; product development techniques or plans; customer lists;

details of customer contracts; current and anticipated customer requirements;

past, current and planned research and development; business acquisition plans;

and new personnel acquisition plans. 

“Confidential Information” shall not include information that has become

generally available to the public by the act of one who has the right to

disclose such information without violating any right or privilege of the

Company or MSB.  This definition shall

not limit any definition of “confidential information” or any equivalent term

under state or federal law.

 

“Determination Date”

means the date of termination of Executive’s employment with the Company or MSB

for any reason whatsoever or any earlier date (during the Employment Period) of

an alleged breach of the Restrictive Covenants by Executive.

 

“Person” means any

individual or any corporation, partnership, joint venture, limited liability

company, association or other entity or enterprise.

 

“Principal or Representative”

means a principal, owner, partner, shareholder, joint venturer, investor,

member, trustee, director, officer, manager, employee, agent, representative or

consultant.

 

“Protected Customers”

means any Person to whom the Company or MSB has sold its products or services

or solicited to sell its products or services during the twelve (12) months

prior to the Determination Date.

 

“Protected Employees” means

employees of the Company or MSB who were employed by the Company or MSB at any

time within six (6) months prior to the Determination Date.

 

“Restricted Period”

means the Employment Period and a period extending two (2) years from the Date

of Termination.

 

“Restricted Territory”

means the areas within a 25 mile radius of each banking

 

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office of the

Company or its subsidiaries immediately after the Effective Date.

 

“Restrictive Covenants”

means the restrictive covenants contained in Section 9(c) hereof.

 

“Trade Secret” means all information, without

regard to form, including, but not limited to, technical or nontechnical data,

a formula, a pattern, a compilation, a program, a device, a method, a

technique, a drawing, a process, financial data, financial plans, product

plans, distribution lists or a list of actual or potential customers,

advertisers or suppliers which is not commonly known by or available to the

public and which information:  (A) derives

economic value, actual or potential, from not being generally known to, and not

being readily ascertainable by proper means by, other persons who can obtain

economic value from its disclosure or use; and (B) is the subject of efforts

that are reasonable under the circumstances to maintain its secrecy.  Without limiting the foregoing, Trade Secret

means any item of confidential information that constitutes a “trade

secret(s)”under the common law or statutory law of the State of Georgia.

 

(c)                                  Restrictive

Covenants.

 

(i)            Restriction on

Disclosure and Use of Confidential Information and Trade Secrets.  Executive understands and agrees that the

Confidential Information and Trade Secrets constitute valuable assets of the

Company and its affiliated entities, and may not be converted to Executive’s

own use.  Accordingly, Executive hereby

agrees that Executive shall not, directly or indirectly, at any time during the

Restricted Period reveal, divulge, or disclose to any Person not expressly

authorized by the Company any Confidential Information, and Executive shall

not, directly or indirectly, at any time during the Restricted Period use or

make use of any Confidential Information in connection with any business

activity other than that of the Company or MSB.  Throughout the term of this Agreement and at all times after the

date that this Agreement terminates for any reason, Executive shall not

directly or indirectly transmit or disclose any Trade Secret of the Company or

MSB to any Person, and shall not make use of any such Trade Secret, directly or

indirectly, for himself or for others, without the prior written consent of the

Company.  The parties acknowledge and

agree that this Agreement is not intended to, and does not, alter either the

Company’s rights or Executive’s obligations under any state or federal

statutory or common law regarding trade secrets and unfair trade practices.

 

Anything herein to the contrary notwithstanding, Executive shall not be

restricted from disclosing or using Confidential Information that is required

to be disclosed by law, court order or other legal process; provided, however,

that in the event disclosure is required by law, Executive shall provide the

Company with prompt notice of such requirement so that the Company may seek an

appropriate protective order prior to any such required disclosure by

Executive.

 

(ii)           Nonsolicitation

of Protected Employees.  Executive

understands and agrees that the relationship between the Company or MSB and

each of their Protected Employees constitutes a valuable asset of the Company

and may not be converted to Executive’s own use.  Accordingly, Executive hereby agrees that during the Restricted

Period Executive shall not directly or indirectly on Executive’s own behalf or

as a Principal or Representative of any Person or otherwise solicit or induce

any Protected Employee to terminate his or her employment relationship with the

Company or MSB or to enter into employment with any other Person.

 

(iii)          Restriction on

Relationships with Protected Customers. 

Executive understands and agrees that the relationship between the

Company or MSB and each of their Protected Customers constitutes a valuable

asset of the Company and may not be converted to Executive’s own use.  Accordingly, Executive hereby agrees that,

during the Restricted Period, Executive shall not, without the prior written

consent of the Company, directly or indirectly, on Executive’s own behalf or as

a Principal or Representative of any Person, solicit, divert, take away or

attempt to solicit, divert or take away a Protected Customer for the purpose of

providing or selling Competitive Services; provided, however,

that the prohibition of this covenant shall apply only to Protected Customers

with whom Executive had Material Contact on the Company’s or MSB’s behalf

during the twelve (12) months immediately preceding the termination of his

employment hereunder.  For purposes of

this Agreement, Executive had “Material Contact” with a Protected

 

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Customer if

(a) he had business dealings with the Protected Customer on the Company’s or

MSB’s behalf; (b) he was responsible for supervising or coordinating the

dealings between the Company or MSB and the Protected Customer; or (c) he

obtained Trade Secrets or Confidential Information about the customer as a

result of his association with the Company or MSB.

 

(iv)          Noncompetition

with the Company and MSB.  The

parties acknowledge: (A) that Executive’s services under this Agreement require

special expertise and talent in the provision of Competitive Services and that

Executive will have substantial contacts with customers of the Company and MSB;

(B) that pursuant to this Agreement, Executive will be placed in a position of

trust and responsibility and he will have access to a substantial amount of Confidential

Information and Trade Secrets and that the Company and MSB are placing him in

such position and giving him access to such information in reliance upon his

agreement not to compete with the Company or MSB during the Restricted Period;

(C) that due to his management duties, Executive will be the repository of a

substantial portion of the goodwill of the Company and MSB and would have an

unfair advantage in competing with the Company or MSB; (D) that due to

Executive’s special experience and talent, the loss of Executive’s services to

the Company or MSB under this Agreement cannot reasonably or adequately be

compensated solely by damages in an action at law; (E) that Executive is

capable of competing with the Company and MSB; and (F) that Executive is capable

of obtaining gainful, lucrative and desirable employment that does not violate

the restrictions contained in this Agreement. 

In consideration of the compensation and benefits being paid and to be

paid by the Company to Executive hereunder, Executive hereby agrees that,

during the Restricted Period, Executive will not, without prior written consent

of the Company, directly or indirectly seek or obtain a Competitive Position in

the Restricted Territory with a Competitor; provided, however,

that the provisions of this Agreement shall not be deemed to prohibit the

ownership by Executive of any securities of the Company or its affiliated

entities or not more than five percent (5%) of any class of securities of any

corporation having a class of securities registered pursuant to the Securities

Exchange Act of 1934, as amended.

 

(d)           Enforcement of

Restrictive Covenants.

 

(i)            Rights and

Remedies Upon Breach.  In the event

Executive breaches, or threatens to commit a breach of, any of the provisions

of the Restrictive Covenants, the Company shall have the right and remedy to

enjoin, preliminarily and permanently, Executive from violating or threatening

to violate the Restrictive Covenants and to have the Restrictive Covenants

specifically enforced by any court of competent jurisdiction, it being agreed

that any breach or threatened breach of the Restrictive Covenants would cause

irreparable injury to the Company and that money damages would not provide an

adequate remedy to the Company.  Such

right and remedy shall be in addition to, and not in lieu of, any other rights

and remedies available to the Company at law or in equity.

 

(ii)           Severability of

Covenants.  Executive acknowledges

and agrees that the Restrictive Covenants are reasonable and valid in time and

scope and in all other respects.  The

covenants set forth in this Agreement shall be considered and construed as

separate and independent covenants. 

Should any part or provision of any covenant be held invalid, void or

unenforceable in any court of competent jurisdiction, such invalidity, voidness

or unenforceability shall not render invalid, void or unenforceable any other

part or provision of this Agreement.  If

any portion of the foregoing provisions is found to be invalid or unenforceable

by a court of competent jurisdiction because its duration, the territory, the

definition of activities or the definition of information covered is considered

to be invalid or unreasonable in scope, the invalid or unreasonable term shall

be redefined, or a new enforceable term provided, such that the intent of the

Company and Executive in agreeing to the provisions of this Agreement will not

be impaired and the provision in question shall be enforceable to the fullest

extent of the applicable laws.

 

9

 

13.              Arbitration.  Any claim or dispute arising under this

Agreement shall be subject to arbitration, and prior to commencing any court

action, the parties agree that they shall arbitrate all controversies.  The arbitration shall be conducted in

Atlanta, Georgia, in accordance with the Employment Dispute Rules of the

American Arbitration Association and the Federal Arbitration Act, 9 U.S.C. §1, et. seq. 

The arbitrator(s) shall be authorized to award both liquidated and

actual damages, in addition to injunctive relief, but no punitive damages.  Such an award shall be binding and

conclusive upon the parties hereto, subject to 9 U.S.C. §10.  Each party shall have the right to have the

award made the judgment of a court of competent jurisdiction.

 

14.              Assignment and

Successors.

 

(a)           This Agreement is

personal to Executive and without the prior written consent of the Company

shall not be assignable by Executive otherwise than by will or the laws of

descent and distribution.  This Agreement

shall inure to the benefit of and be enforceable by the Executive’s legal

representatives.

 

(b)           This Agreement shall

inure to the benefit of and be binding upon the Company and its successors and

assigns.

 

(c)           The Company will

require any successor (whether direct or indirect, by purchase, merger,

consolidation or otherwise) to all or substantially all of the business and/or

assets of the Company to assume expressly and agree to perform this Agreement

in the same manner and to the same extent that the Company would be required to

perform it if no such succession had taken place.

 

15.              Miscellaneous.

 

(a)           Waiver.  Failure of any party to insist, in one or

more instances, on performance by the other in strict accordance with the terms

and conditions of this Agreement shall not be deemed a waiver or relinquishment

of any right granted in this Agreement or of the future performance of any such

term or condition or of any other term or condition of this Agreement, unless

such waiver is contained in a writing signed by the party making the waiver.

 

(b)           Severability.  If any provision or covenant, or any part

thereof, of this Agreement should be held by any court to be invalid, illegal

or unenforceable, either in whole or in part, such invalidity, illegality or unenforceability

shall not affect the validity, legality or enforceability of the remaining

provisions or covenants, or any part thereof, of this Agreement, all of which

shall remain in full force and effect.

 

(c)           Other Agents.  Nothing

in this Agreement is to be interpreted as limiting the Company from employing

other personnel on such terms and conditions as may be satisfactory to it.

 

(d)           Entire Agreement.  Except as provided herein, this Agreement

contains the entire agreement between the Company and Executive with respect to

the subject matter hereof and, from and after the Effective Date, this

Agreement shall supersede any other agreement between the parties with respect

to the subject matter hereof.

 

(e)           Governing Law.  Except to the extent preempted by federal

law, and without regard to conflict of laws principles, the laws of the State

of Georgia shall govern this Agreement in all respects, whether as to its

validity, construction, capacity, performance or otherwise.

 

(f)            Notices. 

All notices, requests, demands and other communications required or

permitted hereunder shall be in writing and shall be deemed to have been duly

given if delivered or three days after mailing if mailed, first class,

certified mail, postage prepaid:

 

	

  To Company:

  	

   

  	

  Main Street

  Banks, Inc.

  
	

   

  	

   

  	

  Edward C. Milligan, Chief Executive Officer

  
	

   

  	

   

  	

  676 Chastain Road

  
	

   

  	

   

  	

  Kennesaw, Georgia 30144

  

 

10

 

	

   

  	

   

  	

   

  
	

  To Executive:

  	

   

  	

  Max S. Crowe

  
	

   

  	

   

  	

  1121 Floyd Street

  
	

   

  	

   

  	

  Covington, GA  30014

  

 

Any party may change

the address to which notices, requests, demands and other communications shall

be delivered or mailed by giving notice thereof to the other party in the same

manner provided herein.

 

(g)           Amendments and

Modifications.  This Agreement may

be amended or modified only by a writing signed by both parties hereto, which

makes specific reference to this Agreement.

 

(h)           Construction.  Each party and his or its counsel have

reviewed this Agreement and have been provided the opportunity to revise this

Agreement and accordingly, the normal rule of construction to the effect that

any ambiguities are to be resolved against the drafting party shall not be

employed in the interpretation of this Agreement.  Instead, the language of all parts of this Agreement shall be

construed as a whole, and according to its fair meaning, and not strictly for

or against any party.

 

IN WITNESS WHEREOF,

the parties hereto have duly executed and delivered this Agreement as of the

date first above written.

 

	

   

  	

   

  	

   

  	

  MAIN STREET BANKS, INC.

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  By:

  	

  /s/ Samuel

  B. Hay III

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

  Samuel B. Hay III

  
	

   

  	

   

  	

   

  	

   

  	

  Chief Operating Officer

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  EXECUTIVE:

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  /s/ Max S.

  Crowe

  	

   

  
	

   

  	

   

  	

   

  	

  Max S. Crowe

  
							

 

11EXHIBIT “D”

EXHIBIT

4.28

 

 

 

THIS OPTION HAS BEEN

ISSUED PRUSUANT TO EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE

SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND THE QUALIFICATION

REQUIREMENTS OF APPLICABLE STATE SECURITIES LAWS (THE “LAWS”).  IT IS UNLAWFUL TO EXERCISE, SELL, PLEDGE OR

OTHERWISE DISPOSE OF THIS OPTION, OR ANY INTEREST THEREIN, OR RECEIVE ANY

CONSIDERATION THEREFORE, IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT

UNDER THE ACT AND QUALIFICATION UNDER THE LAWS, UNLESS EXEMPTIONS FROM SUCH

REGISTRATION AND QUALIFICATION REQUIREMENTS ARE AVAILABLE.

 

THIS OPTION MAY BE

EXERCISED ONLY IN ACCORDANCE WITH THE TERMS OF THIS STOCK OPTION

AGREEMENT.

 

 

THE RICEX COMPANY

 

NON-STATUTORY STOCK OPTION AGREEMENT

 

The RiceX Company, a Delaware corporation (the

“Company”), hereby grants to Laura Andrews (the “Optionee”), an option (the

“Option”) to purchase up to 10,000 shares (“Shares”) of Common Stock, per value

$.001, of the Company (the “Common Stock”) at an exercise price (the “Exercise

Price”) equal to thirty six cents ($.36) per share, which is equal to the

average fair market value of the Company’s Common Stock during the fourth

quarter of 2001, in all respects subject to the terms, definitions and

provisions of this Non-Statutory Stock Option Agreement (the “Agreement”).

 

1.     Nature of the Option. 

The Option is intended to be a nonstatutory option and not

an incentive stock option within the meaning of Section 422 of the

Internal Revenue Code of 1986, as amended (the “Code”).

 

2.     Payment of Exercise Price.

 

(a)  Method

of Payment.  Payment of the Exercise

Price for shares purchased upon exercise of the Option shall be made (i) by

delivery to the Company of cash or a check to the order of the Company in an

amount equal to the purchase price of such shares;  (ii) subject to the consent of the Company, by delivery to the

Company of shares of Common Stock of the Company then owned by the Optionee

having a fair market value equal in amount to the purchase price of such shares

in accordance with Section 2(b);  (iii)

by any other means approved by the Board of Directors and which is consistent

with applicable laws and regulations (including, without limitation, the

provisions of Rule 16b-3 under the Securities Exchange Act of 1934 and

Regulation T promulgated by the Federal Reserve Board); or (iv) by any

combination  of such methods of payment.

 

1

 

(b)           Method of Payment –

Public Market.  In the event there

exists a public market for the Company’s Common Stock on the date of exercise,

payment of the exercise price may be made by surrender of shares of the

Company’s Common Stock.  In this case

payment shall be made as follows:

 

(i)  Optionee

shall deliver to the Secretary of the Company a written notice which shall set

forth the portion of the purchase price the Optionee wishes to pay with Common

Stock, and the number of shares of such Common Stock the Optionee intends to

surrender pursuant to exercise of this Option, which shall be determined by

dividing the aforementioned portion of the purchase price by the average of the

last reported bid and asked prices per share of Common Stock of the Company, as

reported in The Wall Street Journal, (or, if not so reported, as

otherwise reported by the National Association of Securities Dealers Automated

Quotation (NASDAQ) System or, in the event the Common Stock is listed on a

national securities exchange, or on the NASDAQ National Market System, NASDAQ

Small-Cap Market or any successor national market system, the closing price of

Common Stock of the Company on such exchange as reported in the Wall Street

Journal), for the day on which the notice of exercise is sent or delivered;

 

(ii) Fractional shares shall be disregarded and the

Optionee shall pay in cash an amount equal to such fraction multiplied by the

price determined under subparagraph (i) above;

 

(iii)  The

written notice shall be accompanied by a duly endorsed blank stock power with

respect to the number of Shares set forth in the notice, and the certificate(s)

representing said Shares shall be delivered to the Company at its principal

offices within three (3) working days from the date of the notice of exercise;

 

(iv)  The

Optionee hereby authorizes and directs the Secretary of the Company to transfer

so many of the Shares represented by such certificate(s) as are necessary to

pay the purchase price in accordance with the provisions herein;

 

(v)  If any

such transfer of Shares requires the consent of the California Commissioner of

Corporations or of some other agency under the securities laws of any other

state, or an opinion of counsel for the Company or Optionee that such transfer

may be effected under applicable Federal and state securities laws, the time

periods specified herein shall be extended for such periods as the necessary

request for consent to transfer is pending before said Commissioner or other

agency, or until counsel renders such an opinion, as the case may be.  All parties agree to cooperate in making

such request for transfer, or in obtaining such opinion of counsel, and no

transfer shall be effected without such consent or opinion if required by

law;  and

 

(vi) 

Nothwithstanding any other provision herein, the Optionee shall only be

permitted to pay the purchase price with shares of the Company’s Common Stock

owned by him as of the exercise date in the manner and within the time periods

allowed under Rule 16b-3 promulgated under the Securities Exchange Act of 1934

as such regulation is presently constituted, as it is amended from time to

time, and as it is interpreted now or hereafter by the 

 

2

 

Securities and Exchange Commission and any such shares shall have been

held by the Optionee for not less than six (6) months.

 

3.               Exercise of

Option.  The Option shall vest and

become exercisable during its term, subject to the provisions of Section 5

below, as follows:

 

(a)   Vesting and Right to Exercise.

 

(i)  The Option

hereby granted shall vest and become exercisable as to the following schedule:

a) 1/3 of the shares subject to this Option, shall vest and become exercisable

on the award date; b) 1/3 of the shares subject to this Option, shall vest and

become exercisable on the first anniversary of the award date; c) 1/3 of the

shares subject to this Option, shall vest and become exercisable on the second

anniversary of the award date.

 

If there should occur a “change of control” of the Company, as defined

below, then the Option shall immediately vest and become exercisable in

full.  For purposes of the foregoing

provision, a “change in control” means the occurrence of any of the following:

 

(A)  any

“person”, as such term is used in Sections 13(d) and 14(d) of the Exchange Act

of 1934, as amended (the “Exchange Act”) (other than the Company or its

existing shareholders) is or becomes the “beneficial owner” (as defined in Rule

13d-3 under the Exchange Act), directly or indirectly, of securities of the

Company (or a successor to the Company) representing 50% or more of the

combined voting power of the then outstanding securities of the Company or such

successor;

 

(B)  the

dissolution of the Company or liquidation of more than 50% or more in value of

the assets of the Company, (ii) any merger or reorganization of the Company

whether or not another entity is the survivor, (iii) a transaction (other than

the initial public offering of Company’s shares) pursuant to which holders, as

a group, of all of the shares of the Company outstanding before the

transaction, hold, as a group, less than 50% of the combined voting power of

the Company or any successor company outstanding after the transaction, or (iv)

any other event or series of events which the board determines, in its

discretion, would materially alter the structure of the Company or its

ownership.

 

(ii)  In the event

of the Optionee’s death, disability or other termination of employment prior to

exercise, the exercisability of the Option shall be governed by Section 5,

below.

 

(iii)  The

Option may be exercised in whole or in part but may not be exercised as to fractional

shares.

 

(b)   Method

of Exercise.  In order to exercise

any portion of the Option, the Optionee shall execute and deliver to the Chief

Financial Officer of the Company, the Notice of Exercise of Stock Option in the

form attached hereto as Exhibit A, together with the Consent of Spouse.  The Notice of Exercise must be accompanied

by payment in full of the aggregate purchase price for the Shares to be

purchased in the type of consideration set forth in Section 2.  The Notice of 

 

3

 

Exercise may be delivered to the Company at any time.  The certificate(s) for the Shares as to

which the Option has been exercised shall be registered in the name of Optionee

or his designee.

 

(c)   Restrictions

on Exercise.  The Option may not be

exercised if the issuance of the Shares upon such exercise or the method of

payment of consideration for such Shares would constitute a violation of any

applicable Federal or state securities law or any other law or regulation.  As a condition to the exercise of the

Option, the Company may require the Optionee to make any representation or

warranty to the company at the time of exercise of the Option as in the opinion

of legal counsel for the Company may be required by any applicable law or

regulation, including the execution and delivery of an appropriate

representation statement.  The stock

certificate (s) for the Shares issued upon exercise of the Option may bear

appropriate legends restricting transfer.

 

(d)   Delivery

of Certificates.  The Company shall

deliver the certificate(s) for the Shares issued upon exercise of the Option to

the Optionee as soon as is practicable; 

provided, however, that if any law or regulation requires the

Company to take any action with respect to such shares before the issuance

thereof, including, without limitation, actions taken pursuant to Section 6

below, then the date of delivery of such Shares shall be extended for a period

necessary to take such action.

 

4.     Non-Transferability of Option.  The Option may be exercised during the lifetime of the Optionee

only by the Optionee any may not be transferred in any manner other than by

will or by the laws of descent and distribution.  The terms of the Option shall be binding upon the executors,

administrators, heirs and successors of the Optionee.

 

5.     Term of the Option. 

Except as otherwise provided in this Agreement, to the extent not

previously exercised, the right to exercise the Option shall terminate on the

tenth (10th) anniversary of the Date of Grant.  Notwithstanding the foregoing, if an

Optionee ceases to be an employee of the Company he/she will be treated in the

following manner relative to their option exercise period:  a) If the Optionee retires, their option exercise

period will be extended for three years from the date of retirement. b) If the

Optionee dies or becomes disabled, their option period will be extended for

three years from the date of such death or disability.  In the event of death of Optionee, the

surviving heirs will have the same extended exercise right as that of the

Optionee. c) If the Optionee’s employment is terminated for the benefit of the

Company, their option exercise period will be extended for three years from the

date of termination.  d) In all other

cases of separation, the option exercise period will be 90 days; provided,

however, that in no event may the Option be exercised after its ten (10)

year term has expired.  To the extent

that the Optionee was not entitled to exercise an Option at the date of such

termination, or if he or she does not exercise such Option (which he or she was

entitled to exercise) within the time specified herein, the Option shall

terminate.

 

6.     Adjustments Upon Changes in Capitalization:  Other Adjustments.  Subject to any required action by the shareholders

of the Company, the number of 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 stock split, reverse stock split,

combination, reclassification, the payment of a stock dividend on the common

stock or any other increase or decrease in the number of shares of Common Stock

of the Company effected without the receipt of 

 

4

 

consideration by the Company;  provided,

however, that conversion of any convertible securities of the Company

shall not be deemed to have been “effected without receipt of

consideration.”  Such adjustment shall

be made by the Board, whose determination in that respect shall be final,

binding and conclusive.  Except as

expressly provided herein,  no issue by

the Company of shares of stock of any class, or securities convertible into

shares of stock of any class, shall affect, and not adjustment by reason

thereof shall be made with respect to, the number of Shares subject to, or the

Exercise Price of, this Option.

 

The Board may, if it so determines in the exercise of its sole

discretion, also make provision for adjusting the number of Shares, we well as

the Exercise Price, in the event that the Company effects one or more

reorganizations, recapitalizations, rights offerings, or other increases or

reductions of shares of its outstanding common stock, and in the event of the

Company being consolidated with or merged into any other corporation;  provided, however, that in no event

shall the Optionee be adversely affected by such adjustment.

 

The Board may, if it so determines in the exercise of its sole

discretion, also make provision for changing, modifying, amending or adjusting

any of the terms of this Option solely in order for the Company to perfect a

significant financing;  provided,

however, that in no event shall the Optionee be adversely affected by such

adjustment.

 

7.     Rights of Shareholder. 

Optionee shall have no rights as a shareholder with respect to the

Shares until the date of the issuance or the transfer to the Optionee of the

certificate(s) for such Shares and only after the Exercise Price for such

Shares has been paid in full.

 

8.     Amendment.  Except

as set forth in Section 6, this Agreement may not be amended without the

written consent of the Optionee.

 

9.     Income Tax Withholding. 

The Optionee authorizes the Company to withhold, in accordance with

applicable law from any compensation payable to him or her, any taxes required

to be withheld by Federal, state or local laws as a result of the exercise of

this Option.  Furthermore, in the event

of any determination that the Company has failed to withhold a sum sufficient

to pay all withholding taxes due in connection with the exercise of this

Option, the Optionee agrees to pay the Company the amount of such deficiency in

cash within five (5) days after receiving a written demand from the Company to

do so, whether or not Optionee is an employee or director of the Company at

that time.

 

10.   Investment Representations; Legends.

 

(a)  Representations.  The Optionee represents, warrants and

covenants that:

 

(i)  Any shares

purchased upon exercise of this Option shall be acquired for the Optionee’s

account for investment only, and not with a view to, or for sale in connection

with, any distribution of the shares in violation of the Securities Act of 1933

(the “Securities Act”), or any rule or regulation under the Securities Act.

 

(ii)  The

Optionee has had such opportunity as he or she has deemed adequate to obtain

from representatives of the Company such information as is necessary to permit

the Optionee to evaluate the merits and risks of his or her investment in the

Company.

 

5

 

(iii) The Optionee is able to bear the economic risk

of holding such shares acquired pursuant to the exercise of this option for an

indefinite period.

 

(iv)  The

Optionee understands that the Shares acquired pursuant to the exercise of this

option are not registered under the Securities Act and are “restricted

securities” within the meaning of Rule 144 under the Securities Act and may not

be transferred, sold or otherwise disposed of in the absence of an effective

registration statement with respect to the Shares filed and made effective

under the Securities Act of 1933, or an opinion of counsel satisfactory to the

Company to the effect that registration under such Act is not required.

 

By making payment upon exercise of this option, the Optionee shall be

deemed to have reaffirmed, as of the date of such payment, the representations

made in this Section 10.

 

	

  DATE OF GRANT: January 2, 2002

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

  THE RiceX COMPANY

  	

   

  	

   

  
	

   

  	

  By:

  	

       /s/ Daniel L. McPeak,

  Sr

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  Daniel L. McPeak, Sr., Chief Executive Officer

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

       /s/Todd C. Crow

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  Todd C. Crow, Chief Financial Officer

  
					

 

The Optionee acknowledges receipt of the Non-Statutory

Stock Option Agreement attached hereto and represents that he or she is

familiar with the terms and provisions thereof, and hereby accepts the Option

subject to all of the terms and provisions thereof.  The Optionee hereby agrees to accept as binding, conclusive and

final all decisions or interpretations of the Board of Directors of The RiceX

Company upon any questions arising under such Agreement.

 

	

  Dated:

  	

   

  	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  OPTIONEE:

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  Laura Andrews

  

 

6

 

CONSENT OF SPOUSE

 

I,

                                            ,

spouse of the Optionee who executed the Non-Statutory Stock Option Agreement

attached hereto, hereby agree that my spouse’s interest in the shares of Common

Stock of The RiceX Company subject to said Agreement shall be irrevocably bound

by the Agreement’s terms.  I agree to accept

as binding, conclusive and final all decisions or interpretations of the Board

of Directors of The RiceX Company upon any questions arising under such

Agreement.  I further agree that my

community property interest in such Shares, if any, shall similarly be bound by

said Agreement and that such consent is binding upon my executors,

administrators, heirs and assigns.  I

agree to execute and deliver such documents as may be necessary to carry out

the intent of said Agreement and this consent.

 

	

  Dated:

  	

   

  	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  Signature:

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  Print Name:

  	

   

  

 

7

 

EXHIBIT A

 

	

  To:

  	

   

  	

  The RiceX Company

  
	

   

  	

   

  	

  1241 Hawk’s Flight Court, Suite 103

  
	

   

  	

   

  	

  El Dorado Hills, 

  CA  95762

  
	

   

  	

   

  	

   

  
	

  Subject:

  	

   

  	

  NOTICE OF EXERCISE OF STOCK OPTION

  

 

With respect to the stock

option granted to the undersigned by The RiceX Company, (the “Company”) on

                                 ,

to purchase an aggregate of

                         

shares of the Company’s Common Stock, this is official notice that the undersigned

hereby elects to exercise such option to purchase shares as follows:

 

	

   

  	

  NUMBER OF SHARES:

  	

   

  	

   

  	 

	

   

  	

   

  	

   

  	

   

  	 

	

   

  	

  DATE OF PURCHASE:

  	

   

  	

   

  	 

	

   

  	

   

  	

   

  	

   

  	 

	

   

  	

  MODE OF PAYMENT:

  	

   

  	

  (certified check or cash)

  	 

	

   

  	

   

  	

   

  	

   

  	 

	

   

  	

   

  	

   

  	

   

  	 

	

   

  	

  The shares should be issued as follows:

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  NAME:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  ADDRESS:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
							

 

	

   

  	

  Signed:

  	

   

  	

   

  	 

	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Dated:

  	

   

  	

   

  	 

									

 

	

   

  	 

	

  Please send this notice of exercise to:

  
	

   

  
	

  The RiceX Company

  
	

  1241 Hawk’s Flight Court. Suite 103

  
	

  El Dorado Hills, CA 

  95762

  

 

8

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