Common use of Outstanding Options Clause in Contracts

Outstanding Options. (a) At the Effective Time, each option to acquire shares of Bank Stock that is outstanding and unexercised immediately prior thereto (each a “Bank Stock Option”) pursuant to the Redstone Bank 2004 Stock Option Plan (“Bank Option Plan”) shall, pursuant to and in accordance with the terms of the Bank Option Plan and the terms of the applicable option agreement, automatically become vested and shall, subject to any adjustment required by Section 2.3 hereof, be converted (automatically and without any action on the part of the holder thereof) into an option (the “Adjusted Option”) to purchase, on the same terms and conditions as applied to such Bank Option immediately prior to the Effective Time (but giving effect to any accelerated vesting triggered by the consummation of the Merger), the number of shares of Parent Stock equal to the number of shares of Bank Stock subject to the Bank Stock Option multiplied by the Exchange Ratio, at an exercise price per share of Bank Stock (rounded up to the nearest whole cent) equal to the exercise price for each such share of Bank Stock subject to such Bank Stock Option immediately prior to the Effective Time divided by the Exchange Ratio. (b) As of the Effective Time, Parent will assume the obligations and succeed to the rights of the Bank under the Bank Option Plan with respect to the Adjusted Options. Parent and the Bank agree that the Bank Option Plan shall be amended, effective as of the Effective Time, (i) if and to the extent necessary and practicable, to reflect the transactions contemplated by this Agreement, including, without limitation, the conversion of Bank Stock Options into Adjusted Options and the substitution of Parent for the Bank thereunder to the extent appropriate to effectuate the assumption of the Bank Option Plan by Parent, and (ii) to preclude any automatic or formulaic grant of options, restricted shares or other awards thereunder on or after the Effective Time. From and after the Effective Time, all references to the Bank (other than any references relating to a “change in control” of the Bank) in the Bank Option Plan and in each agreement evidencing any award of Bank Stock Options shall be deemed to refer to Parent unless Parent determines otherwise. Parent will amend the Bank Option Plan so that no additional options may be issued under the Bank Option Plan after the Effective Time.

Outstanding Options. (a) At Prior to the Effective Time, each option to acquire shares of Bank Stock purchase Company Shares (each, a "Company Option") that is outstanding and unexercised immediately prior thereto (each a “Bank Stock Option”) pursuant to the Redstone Bank 2004 Stock Company Option Plan Plans in effect on the date hereof shall (“Bank i) be terminated if the result of dividing (A) the exercise price of such Company Option Plan”by (B) shallthe Exchange Ratio and rounding the result to the nearest tenth of one cent (hereinafter, pursuant to and in accordance with the terms "Post-Merger Exercise Price"), is greater than the closing sale price of the Bank Parent Shares on the trading day immediately preceding the Effective Time, and (ii) if the Post-Merger Exercise Price of such Company Option Plan and is less than or equal to the terms closing sale price of the applicable Parent Shares on the trading day immediately preceding the Effective Time, become and represent an option agreement, automatically become vested and shall, to purchase (a "Substitute Option") the number of Parent Shares (rounded to the nearest full share) determined by multiplying (X) the number of Company Shares subject to any adjustment required by Section 2.3 hereof, be converted (automatically and without any action on the part of the holder thereof) into an option (the “Adjusted Option”) to purchase, on the same terms and conditions as applied to such Bank Company Option immediately prior to the Effective Time by (but giving effect to any accelerated vesting triggered by the consummation of the Merger), the number of shares of Parent Stock equal to the number of shares of Bank Stock subject to the Bank Stock Option multiplied by Y) the Exchange Ratio, at an exercise price per share of Bank Stock (rounded up to the nearest whole cent) Parent Shares equal to the Post-Merger Exercise Price. It is the intent of the Parties that the Substitute Options shall qualify following the Effective Time as "incentive stock options" as defined in Section 422 of the Code to the extent that the related Company Options qualified as incentive stock options immediately prior to the Effective Time, and the provisions of this Section 4.1(c) shall be applied consistent with such intent. Parent shall pay cash to holders of Company Options in lieu of issuing fractional Parent Shares upon the exercise price of Substitute Options for Parent Shares. After the Effective Time, except as provided above in this Section 4.1(c), each such share of Bank Stock subject to such Bank Stock Substitute Option shall be exercisable upon the same terms and conditions as were applicable under the related Company Option immediately prior to the Effective Time divided by after giving effect to any provision contained in such Company Option providing for accelerated vesting as a result of this Agreement. The Company agrees that, after the Exchange Ratio. (b) As date of this Agreement, it will not grant any stock appreciation rights or limited stock appreciation rights and will not permit cash payments to holders of Company Options in lieu of the Effective Timesubstitution therefor of Substitute Options, as described in this Section 4.1(c). Parent will assume the obligations and succeed to the rights reserve a sufficient number of the Bank under the Bank Option Plan with respect to the Adjusted Options. Parent and the Bank agree that the Bank Option Plan shall be amended, effective as of the Effective Time, Shares (i) if and to the extent necessary and practicable, to reflect the transactions contemplated by for issuance under this Agreement, including, without limitation, the conversion of Bank Stock Options into Adjusted Options and the substitution of Parent for the Bank thereunder to the extent appropriate to effectuate the assumption of the Bank Option Plan by Parent, Section 4.1(c) and (ii) to preclude any automatic or formulaic grant of options, restricted shares or other awards thereunder on or after the Effective Time. From and after the Effective Time, all references to the Bank (other than any references relating to a “change in control” of the Bank) in the Bank Option Plan and in each agreement evidencing any award of Bank Stock Options shall be deemed to refer to Parent unless Parent determines otherwise. Parent will amend the Bank Option Plan so that no additional options may be issued for issuance under the Bank Option Plan after the Effective TimeSection 6.18.