Document:

EXHIBIT 10.4

 

NEW SOUTHERN BANK 2001 STOCK INCENTIVE PLAN,

AS AMENDED

 

 

FIRST AMENDMENT TO THE

NEW SOUTHERN BANK

2001 STOCK INCENTIVE PLAN

 

THIS FIRST AMENDMENT is made as of                         ,
2002, by NEW SOUTHERN BANK, a bank organized under the laws of the state of
Georgia (the “Bank”).

 

WHEREAS, the Bank maintains the New South Bank 2001
Stock Incentive Plan (the “Plan”), which was adopted by the Bank’s Board of
Directors as of                                   ,
2001;

 

WHEREAS, since the Plan was adopted by the Bank’s
Board of Directors, the name of the Bank has been changed to New Southern Bank;
and

 

WHEREAS, the Bank desires to amend the Plan to reflect
the change in the name of the Bank.

 

NOW, THEREFORE, BE IT RESOLVED, that, effective as of                       ,
the Company does hereby amend the Plan in all relevant sections to reflect the
name of the Plan as the “New Southern Bank 2001 Stock Incentive Plan.”

 

Except as specifically amended hereby, the remaining
provisions of the Plan shall remain in full force and effect as prior to the
adoption of this First Amendment.

 

IN WITNESS WHEREOF, the Bank has caused this First
Amendment to be executed, effective as of the date first above written.

 

	
   

  	
  NEW SOUTHERN
  BANK

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
					

 

 

NEW SOUTHERN BANK

2001 STOCK INCENTIVE PLAN

 

 

TABLE OF CONTENTS

 

	
  SECTION 1

  	
  DEFINITIONS

  	
   

  
	
  1.1

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2

  	
  THE STOCK INCENTIVE PLAN

  	
   

  
	
  2.1

  	
  Purpose of the Plan

  	
   

  
	
  2.2

  	
  Stock Subject to the Plan

  	
   

  
	
  2.3

  	
  Administration of the Plan

  	
   

  
	
  2.4

  	
  Eligibility and Limits

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3

  	
  TERMS OF STOCK INCENTIVES

  	
   

  
	
  3.1

  	
  General Terms and Conditions

  	
   

  
	
  3.2

  	
  Terms and Conditions of Options

  	
   

  
	
   

  	
  (a)

  	
  Option Price

  	
   

  
	
   

  	
  (b)

  	
  Option Term

  	
   

  
	
   

  	
  (c)

  	
  Payment

  	
   

  
	
   

  	
  (d)

  	
  Conditions
  to the Exercise of an Option

  	
   

  
	
   

  	
  (e)

  	
  Termination
  of Incentive Stock Option

  	
   

  
	
   

  	
  (f)

  	
  Special
  Provisions for Certain Substitute Options

  	
   

  
	
  3.3

  	
  Treatment of Awards Upon Termination of
  Service

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4

  	
  RESTRICTIONS ON STOCK

  	
   

  
	
  4.1

  	
  Escrow of Shares

  	
   

  
	
  4.2

  	
  Restrictions on Transfer

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5

  	
  GENERAL PROVISIONS

  	
   

  
	
  5.1

  	
  Withholding

  	
   

  
	
  5.2

  	
  Changes in Capitalization; Merger;
  Liquidation

  	
   

  
	
  5.3

  	
  Cash Awards

  	
   

  
	
  5.4

  	
  Compliance with Code

  	
   

  
	
  5.5

  	
  Right to Terminate Service

  	
   

  
	
  5.6

  	
  Restrictions on Delivery and Sale of
  Shares; Legends

  	
   

  
	
  5.7

  	
  Non-Alienation of Benefits

  	
   

  
	
  5.8

  	
  Termination and Amendment of the Plan

  	
   

  
	
  5.9

  	
  Stockholder Approval

  	
   

  
	
  5.10

  	
  Choice of Law

  	
   

  
	
  5.11

  	
  Effective Date of the Plan

  	
   

  

 

 

NEW SOUTHERN BANK

2001 STOCK INCENTIVE PLAN

 

SECTION 1  DEFINITIONS

 

1.1                                 Definitions.  Whenever used herein, the masculine
pronoun shall be deemed to include the feminine, and the singular to include
the plural, unless the context clearly indicates otherwise, and the following
capitalized words and phrases are used herein with the meaning thereafter
ascribed:

 

(a)                                  “Affiliate” means

 

(1)                                  any Subsidiary or Parent;

 

(2)                                  an entity that directly or through one or more intermediaries
controls, is controlled by, or is under common control with the Bank, as
determined by the Bank; or

 

(3)                                  any entity in which the Bank has such a significant interest that
the Bank determines it should be deemed an “Affiliate,” as determined in the
sole discretion of the Bank.

 

(b)                                 “Bank” means New Southern Bank, a proposed state bank.

 

(c)                                  “Board
of Directors” means the board of directors of the Bank.

 

(d)                                 “Cause” has the same meaning as provided in the employment
agreement between the Participant and the Bank or Affiliate(s) on the date of
Termination of Service, or if no such definition or employment agreement
exists, “Cause” means conduct amounting to 
(1) fraud or dishonesty against the Bank or Affiliate(s); (2) Participant’s
willful misconduct, repeated refusal to follow the reasonable directions of the
Board of Directors or knowing violation of law in the course of performance of
the duties of Participant’s service with the Bank or Affiliate(s); (3) repeated
absences from work without a reasonable excuse; (4) repeated intoxication
with alcohol or drugs while on the Bank’s or Affiliate(s)’ premises during
regular business hours; (5) a conviction or plea of guilty or nolo contendere to a felony or a crime involving dishonesty;
or (6) a breach or violation of the terms of any agreement to which
Participant and the Bank or Affiliate(s) are party.

 

(e)                                  “Change in Control” means any one of the following events
which may occur after the date the Stock Incentive is granted:

 

(1)                                  the acquisition by any person
or persons acting in concert of the then outstanding voting securities of the
Bank, if, after the transaction, the acquiring person (or persons) owns,
controls or holds with power to vote forty percent (40%) or more of any class
of voting securities of the Bank;

 

 

(2)                                  within any
twelve-month period the persons who were directors of the Bank immediately
before the beginning of such twelve-month period (the “Incumbent Directors”)
shall cease to constitute at least a majority of the Board of Directors;
provided that any director who was not a director as of the beginning of such
twelve-month period shall be deemed to be an Incumbent Director if that director
were elected to the Board of Directors by, or on the recommendation of or with
the approval of, at least two-thirds of the directors who then qualified as
Incumbent Directors; and provided further that no director whose initial
assumption of office is in connection with an actual or threatened election
contest (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Securities Exchange Act of 1934) relating to the election
of directors shall be deemed to be an Incumbent Director;

 

(3)                                  a reorganization,
merger or consolidation, with respect to which persons who were the
stockholders of the Bank immediately prior to such reorganization, merger or
consolidation do not, immediately thereafter, own more than fifty percent (50%)
of the combined voting power entitled to vote in the election of directors of
the reorganized, merged or consolidated company’s then outstanding voting
securities; or

 

(4)                                  the sale, transfer or
assignment of all or substantially all of the assets of the Bank to any third
party.

 

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

 

(g)                                 “Committee” means the committee appointed by the Board of
Directors to administer the Plan pursuant to Plan Section 2.3.  If the Committee has not been appointed, the
Board of Directors in its entirety shall constitute the Committee.

 

(h)                                 “Disability” has the same meaning as provided in the
long-term disability plan or policy maintained or, if applicable, most recently
maintained, by the Bank or an Affiliate for the Participant.  If no long-term disability plan or policy was
ever maintained on behalf of the Participant or, if the determination of
Disability relates to an Incentive Stock Option, Disability shall mean that
condition described in Code Section 22(e)(3), as amended from time to
time.  In the event of a dispute, the
determination of Disability shall be made by the Board of Directors and shall
be supported by advice of a physician competent in the area to which such
Disability relates.

 

(i)                                     “Disposition” means any conveyance, sale, transfer,
assignment, pledge or hypothecation, whether outright or as security, inter
vivos or testamentary, with or without consideration, voluntary or involuntary.

 

(j)                                     “Fair Market Value” with regard to a date means:.

 

(1)                                  the price at which Stock shall have been sold on that date or the
last trading date prior to that date as reported by the national securities
exchange selected by the Committee on which the shares of Stock are then
actively traded or, if applicable, as reported by the Nasdaq Stock Market;

 

2

 

(2)                                  if such market information is not published on a regular basis, the
price of Stock in the over-the-counter market on that date or the last business
day prior to that date as reported by the Nasdaq Stock Market or, if not so
reported, by a generally accepted reporting service; or

 

(3)                                  if Stock is not publicly traded, as determined in good faith by the
Committee with due consideration being given to (i) the most recent
independent appraisal of the Bank, if such appraisal is not more than twelve
months old and (ii) the valuation methodology used in any such appraisal.

 

For purposes
of Paragraphs (1), (2), or (3) above, the Committee may use the closing
price as of the applicable date, the average of the high and low prices as of
the applicable date or for a period certain ending on such date, the price
determined at the time the transaction is processed, the tender offer price for
shares of Stock, or any other method which the Committee determines is
reasonably indicative of the fair market value.

 

(k)                                  “Incentive Stock Option” means an incentive stock option, as
defined in Code Section 422, described in Plan Section 3.2.

 

(l)                                     “Non-Qualified Stock Option” means a stock option, other than
an option qualifying as an Incentive Stock Option, described in Plan Section 3.2.

 

(m)                               “Option” means a Non-Qualified Stock Option or an Incentive
Stock Option.

 

(n)                                 “Over 10% Owner” means an individual who at the time an
Incentive Stock Option is granted owns Stock possessing more than ten percent
(10%) of the total combined voting power of the Bank or one of its Parents or
Subsidiaries, determined by applying the attribution rules of Code Section 424(d).

 

(o)                                 “Parent” means any corporation (other than the Bank) in an
unbroken chain of corporations ending with the Bank if, with respect to
Incentive Stock Options, at the time of granting of the Incentive Stock Option,
each of the corporations other than the Bank owns stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain.

 

(p)                                 “Participant” means an individual who receives a Stock
Incentive hereunder.

 

(q)                                 “Plan” means the New Southern Bank 2001 Stock Incentive Plan.

 

(r)                                    “Stock” means the Bank’s common stock, $5.00 par value per
share.

 

(s)                                  “Stock Incentive Agreement” means an agreement between the
Bank and a Participant or other documentation evidencing an award of a Stock
Incentive.

 

3

 

(t)                                    “Stock Incentives” means, collectively, Incentive Stock
Options and Non-Qualified Stock Options.

 

(u)                                 “Subsidiary” means any corporation (other than the Bank) in
an unbroken chain of corporations beginning with the Bank if, with respect to
Incentive Stock Options, at the time of the granting of the Incentive Stock
Option, each of the corporations other than the last corporation in the
unbroken chain owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in the chain.  A “Subsidiary” shall
include any entity other than a corporation to the extent permissable under Section 424(f) or
regulations or rulings thereunder.

 

(v)                                 “Termination of Service” means the termination of the service
relationship, whether employment or otherwise, between a Participant and the
Bank and any Affiliates, regardless of the fact that severance or similar
payments are made to the Participant for any reason, including, but not by way
of limitation, a termination by resignation, discharge, death, Disability or
retirement.  The Committee shall, in its
absolute discretion, determine the effect of all matters and questions relating
to a Termination of Service, including, but not by way of limitation, the
question of whether a leave of absence constitutes a Termination of Service, or
whether a Termination of Service is for Cause.

 

SECTION 2  THE STOCK
INCENTIVE PLAN

 

2.1                                 Purpose
of the Plan.  The Plan is intended
to (a) provide incentives to employees, directors and organizers of the
Bank and its Affiliates to stimulate their efforts toward the continued success
of the Bank and to operate and manage the business in a manner that will
provide for the long-term growth and profitability of the Bank; (b) encourage
stock ownership by employees, directors and organizers by providing them with a
means to acquire a proprietary interest in the Bank by acquiring shares of
Stock; and (c) provide a means of obtaining and rewarding key personnel.

 

2.2                                 Stock Subject to the Plan.  Subject to adjustment in accordance with Section 5.2,
80,000 shares of Stock (the “Maximum Plan Shares”) are hereby reserved
exclusively for issuance upon exercise or payment pursuant to Stock
Incentives.  At such time as the Bank
becomes subject to Section 16 of the Exchange Act, at no time shall the
Bank have outstanding Stock Incentives subject to Section 16 of the
Exchange Act and shares of Stock issued in respect of Stock Incentives in
excess of the Maximum Plan Shares.  The
shares of Stock attributable to the nonvested, unpaid, unexercised, unconverted
or otherwise unsettled portion of any Stock Incentive that is forfeited or
cancelled or expires or terminates for any reason without becoming vested,
paid, exercised, converted or otherwise settled in full will again be available
for purposes of the Plan.

 

2.3                                 Administration of the Plan.  The Plan shall be administered by the Committee.  The
members of the Committee shall consist solely of at least two members of the Board
of Directors.  During those periods that
the Bank is subject to the provisions of Section 16 of the Securities
Exchange Act of 1934, the Board of Directors shall consider the advisability of

 

4

 

whether each Committee member shall qualify as an
“outside director” as defined in Treasury Regulations §1.162-27(e) as
promulgated by the Internal Revenue Service and a “non-employee director” as
defined in Rule 16b-3(b)(3) as promulgated under the Exchange Act.  The Committee shall have full authority in
its discretion to determine the employees, directors and organizers of the Bank
or its Affiliates to whom Stock Incentives shall be granted and the terms and
provisions of Stock Incentives subject to the Plan.  Subject to the provisions of the Plan, the
Committee shall have full and conclusive authority to interpret the Plan; to
prescribe, amend and rescind rules and regulations relating to the Plan;
to determine the terms and provisions of the respective Stock Incentive
Agreements and to make all other determinations necessary or advisable for the
proper administration of the Plan.  The Committee’s determinations under
the Plan need not be uniform and may be made by it selectively among persons
who receive, or are eligible to receive, awards under the Plan (whether or not
such persons are similarly situated).  The Committee’s decisions shall be
final and binding on all Participants. 
Each member of the Committee shall serve at the discretion of the Board
of Directors and the Board of Directors may from time to time remove members
from or add members to the Committee. 
Vacancies on the Committee shall be filled by the Board of Directors.

 

The Committee shall select one of its members as chairman and shall
hold meetings at the times and in the places as it may deem advisable.  Acts approved by a majority of the Committee
in a meeting at which a quorum is present, or acts reduced to or approved in
writing by a majority of the members of the Committee, shall be the valid acts
of the Committee.

 

2.4                                 Eligibility and Limits.  Stock Incentives may be granted only to employees, directors
and organizers of the Bank or any Affiliate; provided, however, that an
Incentive Stock Option may only be granted to an employee of the Bank or any
Subsidiary.  In the case of Incentive Stock Options, the aggregate Fair
Market Value (determined as of the date an Incentive Stock Option is granted)
of stock with respect to which stock options intended to meet the requirements
of Code Section 422 become exercisable for the first time by an individual
during any calendar year under all plans of the Bank and its Parents and
Subsidiaries shall not exceed $100,000; provided further, that if the
limitation is exceeded, the Incentive Stock Option(s) which cause the
limitation to be exceeded shall be treated as Non-Qualified Stock
Option(s).  On such date as required by
Code Section 162(m) of the Code and the regulations thereunder for
compensation to be treated as qualified performance based compensation, the
maximum number of shares of Stock with respect to which Options may be granted
during any calendar year to an employee may not exceed 50,000, subject to
adjustment in accordance with Section 5.2. 
If, after grant, an Option is cancelled, the cancelled Option shall
continue to be counted against the maximum number of shares for which options
may be granted to an employee as described in this Section 2.4.  If, after grant, the exercise price of an
Option is reduced, the transaction shall be treated as the cancellation of the
Option and the grant of a new Option.  If
an Option is deemed to be cancelled as described in the preceding sentence, the
Option that is deemed to be cancelled and the Option that is deemed to be
granted shall both be counted against the maximum number of shares for which
Options may be granted to an employee during any calendar year.

 

5

 

SECTION 3  TERMS OF
STOCK INCENTIVES

 

3.1                                 General Terms and
Conditions.

 

(a)                                  The number of shares of Stock as to which a Stock Incentive shall be
granted shall be determined by the Committee in its sole discretion, subject to
the provisions of Section 2.2, as to the total number of shares available
for grants under the Plan.

 

(b)                                 Each Stock Incentive shall be evidenced by a Stock Incentive
Agreement in such form and containing such terms, conditions and restrictions
as the Committee may determine is appropriate. 
Each Stock Incentive Agreement shall be subject to the terms of the Plan
and any provision in a Stock Incentive Agreement  that is inconsistent with the Plan shall be
null and void.

 

(c)                                  The date a Stock Incentive is granted shall be the date on which the
Committee has approved the terms of, and satisfaction of any conditions
applicable to, the grant of the Stock Incentive and has determined the
recipient of the Stock Incentive and the number of shares covered by the Stock
Incentive and has taken all such other action necessary to complete the grant
of the Stock Incentive.

 

(d)                                 The Committee may provide in any Stock
Incentive Agreement (or subsequent to the award of a Stock Incentive but prior
to its expiration or cancellation, as the case may be) that, in the event of a
Change in Control, the Stock Incentive shall or may be cashed out on the basis
of any price not greater than the highest price paid for a share of Stock in
any transaction reported by any market or system selected by the Committee on
which the shares of Stock are then actively traded during a specified period
immediately preceding or including the date of the Change in Control or offered
for a share of Stock in any tender offer occurring during a specified period
immediately preceding or including the date the tender offer commences;
provided that, in no case shall any such specified period exceed three (3) months
(the “Change in Control Price”).  For
purposes of this Subsection, any Option shall be cashed out on the basis of the
excess, if any, of the Change in Control Price over the Exercise Price to the
extent the Option is then exercisable in accordance with the terms of the
Option and the Plan.

 

(e)                                  Any Stock Incentive may be granted in connection with all or any
portion of a previously or contemporaneously granted Stock Incentive.  Exercise or vesting of a Stock Incentive
granted in connection with another Stock Incentive may result in a pro rata
surrender or cancellation of any related Stock Incentive, as specified in the
applicable Stock Incentive Agreement.

 

(f)                                    Stock Incentives shall not be transferable or assignable except by
will or by the laws of descent and distribution and shall be exercisable,
during the Participant’s lifetime, only by the Participant; in the event of the
Disability of the Participant, by the legal representative of the Participant;
or in the event of the death of the Participant, by the personal representative
of the Participant’s estate or if no personal representative has been
appointed, by the successor in interest determined under the Participant’s
will.

 

6

 

3.2                                 Terms and Conditions of
Options.  Each
Option granted under the Plan shall be evidenced by a Stock Incentive
Agreement.  At the time any Option is
granted, the Committee shall determine whether the Option is to be an Incentive
Stock Option or a Non-Qualified Stock Option, and the Option shall be clearly
identified as to its status as an Incentive Stock Option or a Non-Qualified
Stock Option.  At the time any Incentive Stock Option is exercised, the
Bank shall be entitled to place a legend on the certificates representing the
shares of Stock purchased pursuant to the Option to clearly identify them as
shares of Stock purchased upon exercise of an Incentive Stock Option.  An Incentive Stock Option may only be granted
within ten (10) years from the earlier of the date the Plan is adopted by
the Board of Directors or approved by the Bank’s stockholders.  All Options shall provide that the primary
Federal regulator of the Bank may require a Participant to exercise an Option
in whole or in part if the capital of the Bank falls below minimum requirements
and shall further provide that, if the Participant fails to so exercise any
such portion of the Option, that portion of the Option shall be forfeited.

 

(a)                                  Option
Price.  
Subject to adjustment in accordance with Section 5.2 and the other
provisions of this Section 3.2, the exercise price (the “Exercise Price”)
per share of Stock purchasable under any Option shall be as set forth in the
applicable Stock Incentive Agreement.  With respect to each grant of an Incentive
Stock Option to a Participant who is not an Over 10% Owner, the Exercise Price
per share shall not be less than the Fair Market Value on the date the Option
is granted.  With respect to each grant
of an Incentive Stock Option to a Participant who is an Over 10% Owner, the
Exercise Price shall not be less than 110% of the Fair Market Value on the date
the Option is granted.  With respect to
each grant of a Non-Qualified Stock Option, the Exercise Price per share shall
be no less than the Fair Market Value.

 

(b)                                 Option
Term.  The term of an Option shall be as
specified in the applicable Stock Incentive Agreement; provided, however that
any Option granted to a Participant shall not be exercisable after the
expiration of ten (10) years after the date the Option is granted and any
Incentive Stock Option granted to an Over 10% Owner shall not be exercisable
after the expiration of five (5) years after the date the Option is
granted.

 

(c)                                  Payment.  Payment for all shares of Stock purchased pursuant to the exercise
of an Option shall be made in cash or, if the Stock Incentive Agreement
provides, in a cashless exercise through a broker.   In its discretion, the Committee also may
authorize (at the time an Option is granted or thereafter) Bank financing to
assist the Participant as to payment of the Exercise Price on such terms as may
be offered by the Committee in its discretion. 
Payment shall be made at the time that the Option or any part thereof is
exercised, and no shares shall be issued or delivered upon exercise of an
Option until full payment has been made by the Participant.  The holder of
an Option, as such, shall have none of the rights of a stockholder.

 

(d)                                 Conditions
to the Exercise of an Option.  Each Option
granted under the Plan shall be exercisable by the Participant or any other
designated person, at such time or times, or upon the occurrence of such event
or events, and in such amounts, as the Committee shall specify in the Stock
Incentive Agreement; provided, however, that subsequent to the grant of an
Option, the Committee, at any time before complete termination of such Option,
may accelerate the time or times at which such Option may be exercised in whole
or in part, including, without limitation, upon a Change in Control and may
permit the Participant or any other designated

 

7

 

person to exercise the Option, or any portion thereof,
for all or part of the remaining Option term notwithstanding any provision of
the Stock Incentive Agreement to the contrary. 
Notwithstanding the foregoing, no Option granted prior to the third
anniversary of the date the Bank opens for business shall contain provisions
which allow the Option to become vested and exercisable at a rate faster than
in equal, annual one-third increments commencing with the first anniversary of
the Option’s grant date.

 

(e)                                  Termination
of Incentive Stock Option Status.  With
respect to an Incentive Stock Option, in the event of the termination of
employment of a Participant, the Option or portion thereof held by the
Participant which is unexercised shall expire, terminate and become
unexercisable no later than three (3) months after the date of termination
of employment; provided, however, that in the case of a holder whose
termination of employment is due to death or Disability, up to one (1) year
may be substituted for such three (3) month period.  For purposes of this Subsection (e),
termination of employment of the Participant shall not be deemed to have
occurred if the Participant is employed by another corporation (or a parent or
subsidiary corporation of such other corporation) which has assumed the
Incentive Stock Option of the Participant in a transaction to which Code Section 424(a) is
applicable.

 

(f)                                    Special Provisions for Certain Substitute Options.  Notwithstanding anything to the contrary in this Section 3.2,
any Option issued in substitution for an option previously issued by another
entity, which substitution occurs in connection with a transaction to which
Code Section 424(a) is applicable, may provide for an exercise price
computed in accordance with such Code Section and the regulations
thereunder and may contain such other terms and conditions as the Committee may
prescribe to cause such substitute Option to contain as nearly as possible the
same terms and conditions (including the applicable vesting and termination
provisions) as those contained in the previously issued option being replaced
thereby.

 

3.3                                 Treatment of
Awards Upon Termination of Service.  Except as otherwise
provided by Plan Section 3.2(e), any award under this Plan to a
Participant who suffers a Termination of Service may be cancelled, accelerated,
paid or continued, as provided in the Stock Incentive Agreement or, in the
absence of such provision, as the Committee may determine.  The portion of any award exercisable in the
event of continuation or the amount of any payment due under a continued award
may be adjusted by the Committee to reflect the Participant’s period of service
from the date of grant through the date of the Participant’s Termination of
Service or such other factors as the Committee determines are relevant to its
decision to continue the award.

 

SECTION 4  RESTRICTIONS
ON STOCK

 

4.1                                 Escrow of Shares. 
Any certificates representing the shares of Stock issued under the Plan
shall be issued in the Participant’s name, but, if the Stock Incentive
Agreement so provides, the shares of Stock shall be held by a custodian
designated by the Committee (the “Custodian”). 
Each applicable Stock Incentive Agreement providing for transfer of
shares of Stock to the Custodian shall appoint the Custodian as the
attorney-in-fact for the Participant for the term specified in the applicable
Stock Incentive Agreement, with full power and authority in

 

8

 

the Participant’s name, place and stead to transfer,
assign and convey to the Bank any shares of Stock held by the Custodian for
such Participant, if the Participant forfeits the shares under the terms of the
applicable Stock Incentive Agreement.  During the period that the
Custodian holds the shares subject to this Section, the Participant shall be
entitled to all rights, except as provided in the applicable Stock Incentive
Agreement, applicable to shares of Stock not so held.  Any dividends declared on shares of Stock
held by the Custodian shall, as the Committee may provide in the applicable
Stock Incentive Agreement, be paid directly to the Participant or, in the
alternative, be retained by the Custodian until the expiration of the term
specified in the applicable Stock Incentive Agreement and shall then be
delivered, together with any proceeds, with the shares of Stock to the
Participant or to the Bank, as applicable.

 

4.2                                 Restrictions on Transfer. 
The Participant shall not have the right to make or permit to exist any
Disposition of the shares of Stock issued pursuant to the Plan except as
provided in the Plan or the applicable Stock Incentive Agreement.  Any Disposition of the shares of Stock issued
under the Plan by the Participant not made in accordance with the Plan or the
applicable Stock Incentive Agreement shall be void.  The Bank shall not recognize, or have the
duty to recognize, any Disposition not made in accordance with the Plan and the
applicable Stock Incentive Agreement, and the shares so transferred shall
continue to be bound by the Plan and the applicable Stock Incentive Agreement.

 

SECTION 5  GENERAL
PROVISIONS

 

5.1                                 Withholding.  The Bank shall deduct from all cash distributions under the
Plan any taxes required to be withheld by federal, state or local
government.  Whenever the Bank proposes
or is required to issue or transfer shares of Stock under the Plan, the Bank
shall have the right to require the recipient to remit to the Bank an amount
sufficient to satisfy any federal, state and local tax withholding requirements
prior to the delivery of any certificate or certificates for such shares.  A Participant may pay the withholding
obligation in cash, by tendering shares of Stock which have been owned by the
holder for at least six (6) months prior to the date of exercise or, if
the applicable Stock Incentive Agreement provides, a Participant may elect to
have the number of shares of Stock he is to receive reduced by the smallest
number of whole shares of Stock which, when multiplied by the Fair Market Value
of the shares of Stock determined as of the Tax Date (defined below), is
sufficient to satisfy federal, state and local, if any, withholding obligation
arising from exercise or payment of a Stock Incentive (a “Withholding
Election”).  A Participant may make a
Withholding Election only if both of the following conditions are met:

 

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

 

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

 

9

 

5.2                                 Changes in
Capitalization; Merger; Liquidation.

 

(a)                                  The number of shares of Stock reserved for the grant of Options, the
maximum number of shares of Stock for which Options may be granted to any
individual during any calendar year, the number of shares of Stock reserved for
issuance upon the exercise of each outstanding Option, and the Exercise Price
of each outstanding Option shall be proportionately adjusted for any increase
or decrease in the number of issued shares of Stock resulting from a
subdivision or combination of shares or the payment of an ordinary stock
dividend in shares of Stock to holders of outstanding shares of Stock or any
other increase or decrease in the number of shares of Stock outstanding
effected without receipt of consideration by the Bank.

 

(b)                                 In the event of any merger, consolidation, reorganization,
extraordinary dividend, spin-off, sale of substantially all of the Bank’s
assets, other change in the corporate structure of the Bank or its Stock
(including any Change in Control) or tender offer for shares of Stock, the
Committee, in its sole discretion, may make such adjustments with respect to
awards and take such other action as it deems necessary or appropriate to
reflect or in anticipation of such merger, consolidation, reorganization,
extraordinary dividend, spin-off, sale of substantially all of the Bank’s
assets, other change in corporate structure or tender offer, including, without
limitation; the assumption of other awards, the substitution of new awards, the
adjustment of outstanding awards (with or without the payment of any
consideration), the acceleration of awards or the removal of restrictions on outstanding
awards, all as may be provided in the applicable Stock Incentive Agreement or,
if not expressly addressed therein, as the Committee subsequently may determine
in the event of any such merger, consolidation, reorganization, extraordinary
dividend, spin-off, sale of substantially all of the Bank’s assets, other
change in the corporate structure of the Bank or its Stock or tender offer for
shares of Stock or the termination of outstanding awards in exchange for the
cash value, as determined in good faith by the Committee of the vested and/or
unvested portion of the award.  The
Committee’s general authority under this Section 5.2 is limited by and
subject to all other express provisions of the Plan.  Any adjustment pursuant to this Section 5.2
may provide, in the Committee’s discretion, for the elimination without payment
therefor of any fractional shares that might otherwise become subject to any
Stock Incentive.

 

(c)                                  The existence of the Plan and the Stock Incentives granted pursuant
to the Plan shall not affect in any way the right or power of the Bank to make
or authorize any adjustment, reclassification, reorganization or other change
in its capital or business structure, any merger or consolidation of the Bank,
any issue of debt or equity securities having preferences or priorities as to
the Stock or the rights thereof, the dissolution or liquidation of the Bank,
any sale or transfer of all or any part of its business or assets, or any other
corporate act or proceeding.

 

5.3                                 Cash Awards.  The Committee may, at any time and in its discretion, grant
to any holder of a Stock Incentive the right to receive, at such times and in
such amounts as determined by the Committee in its discretion, a cash amount
which is intended to reimburse such person for all or a portion of the federal,
state and local income taxes imposed upon such person as a consequence of the
receipt of the Stock Incentive or the exercise of rights thereunder.

 

10

 

5.4                                 Compliance with Code.  All Incentive Stock Options to
be granted hereunder are intended to comply with Code Section 422, and all
provisions of the Plan and all Incentive Stock Options granted hereunder shall
be construed in such a manner as to effectuate that intent.

 

5.5                                 Right to Terminate Service.  Nothing in the Plan or in any
Stock Incentive Agreement shall confer upon any Participant the right to
continue as an employee, director, organizer or officer of the Bank or affect
the right of the Bank to terminate the Participant’s services at any time.

 

5.6                                 Restrictions on
Delivery and Sale of Shares; Legends.  Each Stock Incentive is subject to the condition that if at
any time the Committee, in its discretion, shall determine that the listing,
registration or qualification of the shares covered by such Stock Incentive
upon any securities exchange or under any state or federal law is necessary or
desirable as a condition of or in connection with the granting of such Stock
Incentive or the purchase or delivery of shares thereunder, the delivery of any
or all shares pursuant to such Stock Incentive may be withheld unless and until
such listing, registration or qualification shall have been effected.  If
a registration statement is not in effect under the Securities Act of 1933 or
any applicable state securities laws with respect to the shares of Stock
purchasable or otherwise deliverable under Stock Incentives then outstanding,
the Committee may require, as a condition of exercise of any Option or as a
condition to any other delivery of Stock pursuant to a Stock Incentive, that
the Participant or other recipient of a Stock Incentive represent, in writing,
that the shares received pursuant to the Stock Incentive are being acquired for
investment and not with a view to distribution and agree that the shares will
not be disposed of except pursuant to an effective registration statement,
unless the Bank shall have received an opinion of counsel that such disposition
is exempt from such requirement under the Securities Act of 1933 and any applicable
state securities laws.  The Bank may include on certificates representing
shares delivered pursuant to a Stock Incentive such legends referring to the
foregoing representations or restrictions or any other applicable restrictions
on resale as the Bank, in its discretion, shall deem appropriate.

 

5.7                                 Non-Alienation of Benefits. 
Other than as specifically provided herein, no benefit under the Plan
shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge; and any attempt to do so shall be
void.  No such benefit shall, prior to
receipt by the Participant, be in any manner liable for or subject to the
debts, contracts, liabilities, engagements or torts of the Participant.

 

5.8                                 Termination and Amendment
of the Plan.  The Board of Directors at any time may amend
or terminate the Plan without stockholder approval; provided, however, that the
Board of Directors may condition any amendment on the approval of stockholders
of the Bank if such approval is necessary or advisable with respect to tax,
securities or other applicable laws.  No
such termination or amendment without the consent of the holder of a Stock
Incentive shall adversely affect the rights of the Participant under such Stock
Incentive.

 

5.9                                 Stockholder Approval.  
The Plan must be submitted to the stockholders of the Bank for their
approval within twelve (12) months before or after the adoption of the Plan by
the Board of Directors.

 

11

 

5.10                           Choice of Law.  The laws of the State of Georgia
shall govern the Plan, to the extent not preempted by federal law.

 

5.11                           Effective Date of the Plan.  The Plan was approved by
the Board of Directors as of                                     ,
2001 and will be effective as of that date.

 

	
   

  	
  NEW
  SOUTHERN BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
  ATTEST:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Secretary

  	
   

  
	
   

  	
   

  
	
  [SEAL]

  	
   

  
						

 

12EXHIBIT 10.5

 

AMENDMENT TO THE NEW SOUTHERN BANK

INCENTIVE STOCK OPTION AWARD

 

 

AMENDMENT

TO THE NEW SOUTHERN BANK

INCENTIVE STOCK OPTION
AWARD

 

THIS AMENDMENT to
the Incentive Stock Option Award by and between NEW SOUTHERN BANK (the “Bank”),
a bank organized under the laws of the State of Georgia, and MARK A. STEVENS
(the “Optionee”) is made as of October 6, 2005.

 

W I  T  N  E
S  S  E  T  H:

 

WHEREAS, the
Optionee has been granted by the Bank options to purchase 40,000 shares of the
common stock of the Bank pursuant to Incentive Stock Option Awards dated,
respectively, December 10, 2001 (the “2001 Option Agreement”) granting
16,000 option shares and December 10, 2002 (the “2002 Option Agreement”)
granting 24,000 option shares (collectively, the 2001 Option Agreement and the
2002 Option Agreement are referred to as the “Option Agreements”);

 

WHEREAS, the Bank
and the Optionee now desire to amend the Option Agreements to provide that the
options shall fully vest upon the death of the Optionee; and

 

WHEREAS, the Bank
and the Optionee now desire to amend the 2002 Option Agreement to provide for
vesting over five (5) years.

 

NOW, THEREFORE,
in consideration of the foregoing, the mutual covenants and promises herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby amend the
Option Agreements, effective as of October 6, 2005, as follows:

 

1. By adding new Section E
to Schedule 1 of the Option Agreements as follows:

 

“E.                                Notwithstanding Part A, in
the event of the Optionee’s death, the Option will be immediately fully vested
as of the date of death.”

 

2.                                       By deleting Section A of Schedule 1
of the 2002 Option Agreement and substituting therefor the following:

 

“A.                             The Option Shares shall become vested Option Shares following
completion of the years of service as an employee of the Bank or any Parent or
Subsidiary as indicated in the schedule below.

 

	
  Percentage
  of Option Shares

  Which are Vested Shares

  	
   

  	
  Years of Service

  after the Grant Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  20%

  	
   

  	
   

  	
  1

  	
   

  
	
  40%

  	
   

  	
   

  	
  2

  	
   

  
	
  60%

  	
   

  	
   

  	
  3

  	
   

  
	
  80%

  	
   

  	
   

  	
  4

  	
   

  
	
  100%

  	
   

  	
   

  	
  5”

  	
   

  

 

 

IN WITNESS
WHEREOF, the parties have executed this Amendment as of the date first above
stated.

 

	
   

  	
  NEW SOUTHERN BANK

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William A. Fickling
  III

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
    Chairman of
  the Board

  	
   

  
	
   

  	
   

  
	
  ATTEST:

  	
   

  
	
   

  	
   

  
	
    /s/ Carol A.
  Soto

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   Senior Vice
  President

  	
   

  	
   

  
	
   

  	
   

  
	
  [CORPORATE SEAL]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OPTIONEE:

  
	
   

  	
   

  
	
   

  	
  /s/ Mark A. Stevens

  	
   

  
	
   

  	
  MARK A. STEVENS

  
						

 

2

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