Document:

Exhibit 4.1

 EXHIBIT 4.1 
  

COLUMBIA BANCORP 
 1997 STOCK
OPTION PLAN 
  
 (As Amended and Restated Effective May 29,
2003) 
  

	1.	PURPOSE OF THE PLAN: 

  
 The purpose of the Plan is to advance the interests of Columbia Bancorp (the “Corporation”) by assisting in attracting and retaining selected employees, directors and consultants (“Key Persons”)
and providing them with increased motivation to exert their best efforts on behalf of the Corporation. 
  

	2.	ADMINISTRATION: 

  
 The Plan shall be administered by the Board of Directors or, to the extent determined by the Board of Directors, a committee consisting of not less than two non-employee directors of the Corporation (within the
meaning of Rule 16b-3 of the Securities Exchange Act of 1934 (the ”Exchange Act”)) to be appointed by and to serve at the pleasure of the Board of Directors (the Board of Directors and/or such Committee, as applicable, referred to herein
as the “Administrator”). The Administrator shall have full power to construe and interpret the Plan and promulgate such regulations with respect to the Plan as may be deemed desirable, to determine the terms and conditions of options
granted under the Plan and to amend any option previously granted under the Plan, provided that no such amendment shall materially adversely affect any outstanding option without the consent of the grantee. 
  

	3.	STOCK SUBJECT TO OPTION: 

  
 The total number of shares of common stock of the Corporation (par value $.01 per share) (“Common Stock”) reserved and available for issuance under the Plan
shall be 300,000; provided, however, that from and after such time as the number of outstanding shares of Common Stock as reflected on the Corporation’s quarterly or year-end balance sheet exceeds 4,296,000, the total number of shares of Common
Stock reserved and available for issuance under the Plan shall automatically be increased so as to equal twelve (12) percent of the number of then outstanding shares of Common Stock, provided, further, that no more than 700,000 shares of Common
Stock shall be cumulatively available for incentive stock options qualifying under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). If any option, or portion of an option, under the Plan expires or terminates
unexercised, becomes unexercisable or is forfeited or otherwise terminated, surrendered or canceled as to any shares of Common Stock, or if any shares of Common Stock are surrendered to the Corporation in connection with any option or the exercise
thereof (whether or not such surrendered shares of Common Stock were acquired pursuant to the Plan), the shares of Common Stock subject to such 

 
option and the surrendered shares of Common Stock shall thereafter be available for further options under the Plan; provided, however, that any such shares
of Common Stock that are surrendered to the Corporation in connection with any option or that are otherwise forfeited after issuance shall not be available for purchase pursuant to any incentive stock option qualifying under Section 422 of the Code.

  

	4.	ELIGIBILITY: 

  
 The individuals who shall be eligible to participate in the Plan shall be the Key Persons of the Corporation, or of any corporation (a “Subsidiary”) in which the Corporation has a proprietary interest by
reason of stock ownership, including any corporation in which the Corporation acquires a proprietary interest after the adoption of this Plan, but only if the Corporation owns or controls, directly or indirectly, stock possessing not less than 50%
of the total combined voting power of all classes of stock in such corporation, as determined and selected by the Administrator from time to time. 
  

	5.	TERMS AND CONDITIONS OF OPTIONS: 

  
 Options under the Plan are intended to be either incentive stock options qualifying under Section 422 of the Code, or non-statutory stock options not qualifying under any
section of the Code as the Administrator may determine in its discretion from time to time, provided, however, that only Key Persons who are employees of the Corporation or a Subsidiary shall be eligible to receive incentive stock options. All
options granted under the Plan shall be issued upon such terms and conditions as the Administrator may determine from time to time, subject to the following provisions (which shall apply to both incentive and non-qualified stock options unless
otherwise indicated): 
  
 (a)    Option Price.    The exercise price per share with respect to each option shall be not less than 100% of the Fair Market Value of the Common Stock on the date the option is granted. “Fair
Market Value” of a share of Common Stock for any purpose on a particular date shall mean the last reported sale price per share of Common Stock, regular way, on such date or, in case no such sale takes place on such date, the average of the
closing bid and asked prices, regular way, in either case as reported in the consolidated transaction reporting system with respect to securities listed or admitted to trading on a national securities exchange or included for quotation on the
Nasdaq-National Market, or if the Common Stock is not so listed or admitted to trading or included for quotation, the last quoted price, or if the Common Stock is not so quoted, the average of the high bid and low asked prices, regular way, in the
over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated Quotation System or, if such system is no longer in use, the principal other automated quotations system that may then be in use or, if the Common
Stock is not quoted by any such organization, the average of the closing bid and asked prices, regular way, as furnished by a professional market maker making a market in the Common Stock as selected in good faith by the Administrator or by such
other source or sources as shall be selected in good faith by the 

  

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Administrator. If, as the case may be, the relevant date is not a trading day, the determination shall be made as of the next preceding trading day. As used
herein, the term “trading day” shall mean a day on which public trading of securities occurs and is reported in the principal consolidated reporting system referred to above, or if the Common Stock is not listed or admitted to trading on a
national securities exchange or included for quotation on the Nasdaq-National Market, any business day. 
  
 (b)    Individual Limit on Number of Options.    Subject to adjustments as provided in Section 6
of the Plan, the maximum number of shares of Common Stock subject to options that may be granted under this Plan to any one employee shall be limited to 250,000. 
  
 (c)    Change in Control.    Except as otherwise provided in an
option agreement, unexercised options shall immediately become exercisable if: (A) Any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations promulgated thereunder) is or becomes the beneficial owner,
directly or indirectly, of 25% or more of the voting equity stock of the Corporation, or any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations promulgated thereunder) other than the Corporation is or
becomes the beneficial owner, directly or indirectly, of 25% or more of the Common Stock of The Columbia Bank; or (B) Any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations promulgated thereunder) gains
control of the election of a majority of the Board of Directors of the Corporation, or any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations promulgated thereunder) other than the Corporation gains
control of the election of a majority of the Board of Directors of The Columbia Bank; or (C) Any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations promulgated thereunder) gains control of the management
or policies of either of the Corporation or The Columbia Bank; or (D) Either the Corporation or The Columbia Bank consolidates with, or merges with or into, another entity (including a corporation, bank, partnership, trust, association, joint
venture, pool, syndicate, sole proprietorship, unincorporated organization or any other form of entity not specifically listed herein) or sells, assigns, conveys, transfers, leases or otherwise disposes of all or substantially all of its assets, or
another such entity consolidates with, or merges with or into, the Corporation or The Columbia Bank in any such event pursuant to a transaction in which the issued and outstanding shares of the voting equity stock of the Corporation or The Columbia
Bank are to be converted into or exchanged for cash, securities or other property; or (E) During any consecutive two-year period, individuals who at the beginning of such period constituted the Board of Directors of either the Corporation or The
Columbia Bank (together with any directors who are members of such Board of Director on the effective date hereof and any new directors whose election or whose nomination for election was approved by a vote of 66-2/3% of the directors then still in
office who were either directors at the beginning of such period or 

  

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whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of either the
Corporation or The Columbia Bank then in office. Notwithstanding the foregoing, if an unexercised option would become exercisable pursuant to this Section 5(c) in connection with a merger, consolidation, sale of substantially all of the assets, or
any other form of corporate reorganization in which the Corporation is not the surviving entity, or a statutory share exchange in which the Corporation is not the issuer, then such option shall be exercisable as of the business day immediately
preceding the effective date of the transaction. 
  
 (d)    Term of Option.    No stock option may be exercisable after the expiration of 10 years after the date such option was granted. 
  
 (e)    Options Nonassignable and Nontransferable.    Each incentive
stock option and all rights thereunder, including the right to surrender the option, shall not be assignable or transferable other than by will or the laws of descent and distribution, and shall be exercisable during the employee’s lifetime
only by the employee or his or her guardian or legal representative. Except to the extent provided by the Administrator, each non-statutory stock option and all rights thereunder, including the right to surrender the option, shall not be assignable
or transferable other than by will or the laws of descent and distribution or pursuant to a domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act (“DRO”), or the rules thereunder, and
shall be exercisable during the optionee’s lifetime only by the optionee or his or her guardian or legal representative or transferee under a DRO. 
  

	6.	ADJUSTMENTS UPON CHANGES IN CAPITALIZATION: 

  
 If the shares of the Common Stock outstanding are increased, decreased, or changed into or exchanged for a different number or kind of shares or securities of the
Corporation, without receipt of consideration by the Corporation, through reorganization, merger, recapitalization, reclassification, stock split-up, stock dividend, stock consolidation, or otherwise, an appropriate and proportionate adjustment
shall be made in the number or kind of shares as to which options have been or may be granted (in the aggregate and to any individual). Any such adjustment in an outstanding option shall be made without change in the aggregate purchase price to be
paid upon the exercise thereof. Adjustments under this paragraph shall be made by the Board of Directors, whose determination as to what adjustments shall be made, and the extent thereof, shall be final and conclusive. No fractional shares of Common
Stock shall be issued under the Plan on account of any such adjustment. 
  
 In the
event of a reorganization, merger, consolidation, sale of substantially all of the assets, or any other form of corporate reorganization in which the Corporation is not the surviving entity or a statutory share exchange in which the Corporation is
not the issuer, all options then outstanding under the Plan will terminate as of the effective date of the transaction. The surviving entity in its absolute and uncontrolled discretion may tender an option or options to purchase shares on its

  

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terms and conditions, both as to the number of shares or otherwise, as shall substantially preserve the rights and benefits of any option then outstanding
under the Plan. 
  

	7.	OPTIONS IN SUBSTITUTION FOR STOCK OPTIONS GRANTED BY OTHER CORPORATIONS: 

  
 Options may be granted under the Plan from time to time in substitution for stock options held by Key Persons of corporations who become or
are about to become Key Persons of the Corporation or a Subsidiary as the result of (i) a merger or consolidation of the employing corporation with the Corporation or a Subsidiary, (ii) the acquisition by the Corporation or a Subsidiary of the
assets of the employing corporation, or (iii) the acquisition by the Corporation or a Subsidiary of stock of the employing corporation. The terms and conditions of the substitute options so granted may vary from the terms and conditions set forth in
Section 5 of this Plan to such extent as the Administrator at the time of the grant may deem appropriate to conform, in whole or in part, to the provisions of the options in substitution for which they are granted. 
  

	8.	EFFECTIVE DATE OF THE PLAN: 

  
 The Plan was originally effective February 24, 1997. The Plan, as amended and restated effective May 29, 2003, is a continuation, and amendment and restatement, of the
Corporation’s 1997 Stock Option Plan, the provisions of which shall continue to control with respect to any options outstanding thereunder to the extent necessary to avoid establishment of a new measurement date for financial accounting
purposes and to preserve the status of any options that are intended to qualify as “incentive stock options” within the meaning of Code Section 422. 
  

	9.	TERMINATION DATE: 

  
 No options may be granted under the Plan after February 23, 2007. Subject to Section 5(d), options granted before the termination date for the Plan may extend beyond that date. 
  

	10.	AMENDMENT: 

  
 The Plan may be amended, suspended, terminated or reinstated, in whole or in part, at any time by the Board of Directors; provided, however, that none of the following changes may be made without the approval of the
stockholders of the Corporation: 
  
 (i)    an increase in the number of shares of Common Stock available under the Plan, other than adjustments pursuant to Section 6; 
  

(ii)    an increase in the number of shares for which a Key Person may be granted options under the Plan; or

  
 (iii)    an extension of
the term of the Plan. 
  

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	11.	COMPLIANCE WITH LAWS AND REGULATIONS: 

  
 The grant, holding and vesting of all options under the Plan shall be subject to any and all requirements and restrictions that may, in the opinion of the Administrator,
be necessary or advisable for the purposes of complying with any statute, rule or regulation of any governmental authority, or any agreement, policy or rule of any stock exchange or other regulatory organization governing any market on which the
Common Stock is traded. 
  

	12.	EXPENSES: 

  
 The Corporation shall bear all expenses and costs in connection with the administration of the Plan. 
  

 6Exhibit 4.2

 EXHIBIT 4.2 
  

COLUMBIA BANCORP 
 7168 Columbia
Gateway Drive 
 Columbia, Maryland 21046 
  

                        ,
20         
  
 Non-Qualified Stock Option Agreement 
  
 [Name] 
 [Address] 
  
 Dear
                        : 
  
 The Administrator of the Columbia Bancorp 1997 Stock Option Plan (the “Plan”) takes pleasure in extending to you an option (the
“Option”) to purchase shares of Common Stock of Columbia Bancorp (the “Common Stock”) pursuant to the Plan. The Option shall be subject to the following terms and conditions: 
  
 (1) Non-Qualified Stock Option. The Option is
intended not to qualify as an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended or replaced (the “Code”). 
  
 (2) Number of Shares. The Option covers
             shares of Common Stock (the “Shares”). 
  
 (3) Option Price. The exercise price per share of Common Stock covered by the Option shall be
$             (“Exercise Price Per Share”; hereinafter “Exercise Price” means the exercise price with respect to all Shares acquired pursuant to
each exercise of the Option). 
  
 (4) Exercise
of Option. [For Options of 200 Shares or Less: Except as provided in Section 5(c) of the Plan, this Option may not be exercised during the first year after the Date of Grant, as defined in Paragraph (6) hereof. Unless terminated earlier
pursuant to other provisions hereof, this Option shall become exercisable in full after one year after the Date of Grant.] [For Options of More than 200 Shares: Except as provided in Section 5(c) of the Plan, this Option (A) may not be
exercised during the first year after the Date of Grant, and (B) unless terminated earlier pursuant to other provisions hereof, the Option may be exercised to acquire up to: (i) twenty-five percent (25%) of the Shares after one year after the Date
of Grant; (ii) fifty percent (50%) after two years; (iii) seventy- 

 
five percent (75%) after three years; and (iv) one hundred percent (100%) after four years. 
  
 (5) Termination of Employment. Except as provided in Paragraph (5)(C) hereof, this Option, to the
extent it is not then exercisable, shall terminate when your employment with Columbia Bancorp (the “Company”) and all Subsidiaries terminates. Except as provided in Paragraphs (5)(A), (5)(B) and 5(C) hereof, the Option, to the
extent it is exercisable but has not been exercised (the “Unexercised Option”), shall also terminate when your employment with the Company and its Subsidiaries terminates. 
  
 (A) Retirement or Voluntary Resignation. If you
terminate employment with the Company and its Subsidiaries due to (i) Retirement, as defined hereinafter, or (ii) voluntary resignation with the consent of the Board of Directors of the Company or a Subsidiary, the Unexercised Option may be
exercised until the expiration of three (3) months after the date your employment terminates. “Retirement” means a retirement from employment with the Company and its Subsidiaries either on or after the first day of the month
coinciding with or next following your sixty-fifth (65th) birthday. 
  
 (B) Disability or Death. If you terminate employment with the Company and its Subsidiaries because of (i) death or (ii) Disability, as defined hereinafter, the Unexercised Option may be exercised (in the case
of death, by your executor, personal representative, or the person to whom the Unexercised Option shall have been transferred by will or the laws of descent and distribution, as the case may be) until the expiration of one (1) year after the date of
your termination of employment. If you die during the three (3) month post-termination exercise period provided to you under Paragraph 5(A) above, the Unexercised Option may be exercised by your executor, personal representative, or the person to
whom the Unexercised Option shall have been transferred by will or the laws of descent and distribution, as the case may be, until the expiration of one (1) year after the date of your death. “Disability” means a permanent mental or
physical disability due to accident or illness that renders you unable to perform every duty of your occupation with the Company and the Subsidiaries for a period of at least one hundred eighty (180) days, provided that you establish such disability
to the satisfaction of the Administrator. Evidence of such Disability shall include the certificate of a competent licensed physician selected by you and approved by the Administrator which confirms that you have a Disability as defined
herein. 
  
 (C) Directors and
Consultants. The foregoing provisions of this Paragraph (5) shall not apply if the Option is granted to a director or consultant of the Company or a Subsidiary who is not also an employee of the Company or a Subsidiary on the date of grant.

  
 (6) Term of Option. This Option is
effective as of the date the Administrator approved the Option,                     ,
20         (the “Date of 

  

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Grant”). Notwithstanding anything herein to the contrary, this Option may not be exercised, in whole or in part, after
                    , 20        . 
  
 (7) Manner of Exercise. You or any person exercising
the Option may do so only by delivering written notice thereof to the Administrator. Such notice shall be in such form as the Administrator may require at its sole discretion. 
  
 (A) Payment of Exercise Price. Full payment for the Exercise Price shall be made at or prior to the
time that the Option, or any part thereof, is exercised (or, in the discretion of the Administrator, at such later time as the certificates for such Shares are delivered). Such payment shall be made: (i) by cash or certified check; (ii) by tender
(via delivery or attestation to the Company of other shares of Common Stock of the Company which have a Fair Market Value on the date of tender equal to the Exercise Price, provided that such shares have been owned by you for a period of at least
six months free of any substantial risk of forfeiture or were purchased on the open market without assistance, direct or indirect, from the Company; or (iii) by a broker-assisted cashless exercise in accordance with Regulation T of the Board of
Governors of the Federal Reserve System and other applicable laws through a brokerage firm pre-approved by the Administrator. 
  
 (B) Withholding Taxes. You shall pay to the Company, or make provision satisfactory to the Administrator for payment of, any
federal and state income and employment taxes required to be withheld with respect to the Option no later than the date of the event creating the tax liability. The Company may, to the extent permitted by law, deduct any such tax obligations from
any payment of any kind otherwise due to you. In the event that payment to the Company of such tax obligations is made in shares of Common Stock, such shares shall be valued at Fair Market Value on the applicable date for such purposes. 

 
 (8) Right As Stockholder. You will have no rights
as a stockholder solely because of the grant or exercise of the Option before the Company issues to you the certificates for the Shares as to which the Option has been exercised. 
  
 (9) Option Non-Assignable and Non-Transferable. The Option and all rights granted hereunder,
including the right to surrender the Option, is not assignable or transferable other than by will or the laws of descent and distribution and, during your lifetime, is exercisable only by you or your guardian or legal representative. 
  
 (10) Restricted Stock. You will receive Shares
restricted in terms of transferability, as will be indicated in a legend printed on the stock certificate in the event that there is not an effective registration statement with respect to such Shares at the time of their issue. 
  
 (11) Terms of Plan. The Option is granted under and
subject to the provisions of the Plan, attached hereto and made a part hereof. Unless stated 

  

 3 

 
otherwise herein, capitalized terms herein shall have the same meaning as defined in the Plan. 
  
 (12) Notices. Any notice required or permitted to be given to the Administrator shall be sufficient
if in writing and hand delivered, or sent by registered or certified mail, to: 
  
 Personnel, Compensation and Stock Option Committee 
 Columbia Bancorp 
 7168 Columbia Gateway Drive 
 Columbia, Maryland 21046 
  
 Such notice shall be deemed given as of the date of delivery or, if delivery
is made by mail, as of the date shown on the postmark on the receipt for registration or certification. 
  
 (13) Non-Guarantee of Employment. Nothing in the Plan or in this Non-Qualified Stock Option Agreement shall confer any right on an
individual to continue in the employ of the Company or any Subsidiary or shall interfere in any way with the right of the Company or a Subsidiary to terminate such employment at any time with or without cause or notice and whether or not such
discharge results in the Option becoming unexercisable. 
  
 (14) Binding Effect. The covenants and agreements of this Non-Qualified Stock Option Agreement contained herein shall be binding upon, and inure to the benefit of, the heirs, legal representatives, successors,
and assigns of the respective parties hereto. 
  
 (15) Entire Agreement. Except as provided in Paragraph (11) hereof, this Non-Qualified Stock Option Agreement contains the entire agreement between the Company and you with respect to the subject matter contained herein. Any oral or
written agreements, representations, warranties, written inducements, or other communications made prior to the execution of this Non-Qualified Stock Option Agreement shall be void and ineffective for all purposes. 
  
 (16) Governing Law. The validity, construction and
effect of this Non-Qualified Stock Option Agreement, and of any rules, regulations, determinations or decisions made by the Administrator relating thereto, and the rights of any and all persons having or claiming to have any interest hereunder,
shall be determined exclusively in accordance with applicable federal laws and the laws of the State of Maryland, without regard to its conflict of laws principles. 
  
 (17) Amendment. This Non-Qualified Stock Option Agreement may be amended from time to time by the
Administrator in its discretion; provided, however, that it may not be amended in a manner that would have a materially adverse effect on the Option as determined in the discretion of the Administrator, except as provided in the Plan or in a written
document signed by you and the Company. 
  
 {Signatures appear
on next page} 
  

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 The copy of the Option enclosed should be signed by you, dated, and returned to the Company prior to
                    , 20         to acknowledge your receipt of the Option and your approval of
each of the terms and conditions hereof. If the Option has not been accepted and approved by you in writing by such date, it shall terminate. 
  

			
	 Very truly yours,

	
	 ADMINISTRATOR, COLUMBIA BANCORP
 1997 STOCK OPTION PLAN

		
	By:	 	 
	 	 	

	Print Name:	 	 
	 	 	

		
	Title:	 	 
	 	 	

	 	 	 

  

			
	Accepted and Approved:
	
	  

	 Print Name:
	 	  

							
	 Dated:
	 	  

	 	, 20	 	  

  
  

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